prompts "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: NERC Statements on Impact of Security Threats on RTOs Body:: I agree with Joe. The IOUs will point to NERC as an objective third party on these issues. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: NERC Meeting Today Body:: There was an all day meeting of the NERC/reliability legislation group today. I will provide a more detailed report but the group completed the process of reviewing the changes that some had suggested to shorten and streamline the NERC electric reliability organization legislation. Sarah and I asked a series of questions and made comments on our key issues and concerns. I want to give you a more complete report once I have gone back over the now final draft version. The timing being imposed by NERC is that they will circulate a clean version of the proposal tomorrow or Monday. They have asked for comments by next Thursday August 16th with an indication of whether each company/organization does or does not sign on to support it. They will then transmit the proposal and the endorsement letter to Congress and the Administration so they have it as Hill and Energy Dept. staff work on electricity drafting issues this month. I pointed out that EPSA is not due to meet internally with its members to discuss these issues until after the NERC deadline. That is not deterring NERC from moving forward with the above time frame. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: http://www.stanford.edu/~wolak/ Body:: nan What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Govt School Alumni Body:: FYI ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Portland Consultants Investigation Finds California Has Capacity for Electricity Needs Body:: FYI ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Data responses in SDG&E -- confidential treatment Body:: PRIVILEGED AND CONFIDENTIAL Appropos of Agave's phone message. Steve was in this loop. The discount reports are available to anyone who wants them under the Open Records Act. TK you indicated that Agave thinks the rates were published somewhere by FERC -- I don't know whether that's true but the bottom line is that FERC has the information in its files and could publish it any time at wants we have no control over that. Let me know if you want me to talk with Agave's lawyers. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL - Residential in CA Body:: In the meeting today no decision was made about what to do with Enron's 16000 residential customers. Each of the contracts gives a basic 30 day out right to Enron. That being said I think that we have a short window to push for DA before any public action impacts us in Sacramento. I realize that the ultimate action (which I think is inevitable) makes it harder for our advocacy on DA but real $ are flowing out of the company. EES will give us notice when a decision is reached. Thanks Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Online Niche Players Capitalize on Natural-Gas Shortage, Bypass Utilities Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: API Question; CONFIDENTIAL AND PRIVILEGED ATTORNEY/CLIENT COMMUNICATION & ATTORNEYS WORK PRODUCT Body:: Stan: V&E wrote/masterminded the partnership agreement for our MLP. It is complicated and has been amended several times. In view of these factors V&E should tell us whether we can use the $2.5 million of cash from the insurance recovery to retroactively reclaim a portion of the 4th quarter API's. In particular Baird should give us this opinion since he has handled the partnership agreement since day one. Baird is gone on vacation for the next week. He is planning to give us an answer within a few days of his return. He will give the matter serious thought but what we are asking is pretty aggressive. His associate Carlos Pena has reviewed the partnership agreement and his first take on the question is that we cannot revise the available cash for the fourth quarter in this way. But the matter requires far more thought than this----and Bob will also need to talk with Lori (also gone on vacation) to come up with a meaningful answer for us. I will stay after this but in light of the above it will probably be early July b/f we get V&E's final position on this. If this won't do please let me know and I'll explore other avenues of getting an answer out of V&E. Thanks. SWD What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Thursday Meeting on Winter Gas Prices Body:: calendar ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Privileged and Confidential communication to my attorneys Body:: Felicia This is a merchant asset which we currently own 100% but plan to sell down in the coming months. It absolutely has separate HR functions from Enron -- they do not participate in Enron benefits and we are working hard to prevent any claims that we could be a joint employer with it. Thoughts? Michelle Enron North America Corp. From: Felecia Acevedo @ ENRON 11/02/2000 08:56 AM To: Michelle Cash/HOU/ECT@ECT cc: Subject: Re: Privileged and Confidential communication to my attorneys Michelle who is GSP? Are they a legal entity? Are they on our payroll? If they are we filed EEO-1's for them. Below is the criteria to file an EEO-1 report: Standard Form 100 must be filed by - A. All private employers who are: (1) subject to Title VII of the Civil Rights Act of 1964 (as amended by the Equal Employment Opportunity Act of 1972) with 100 or more employees EXCLUDING State and local governments primary and secondary school systems institutions of higher education Indian tribes and tax-exempt private membership clubs other than labor organizations OR (2) subject to Title VII who have fewer than 100 employees if the company is owned or affiliated with another company or there is centralized ownership control or management (such as central control of personnel policies and labor relations) so that the group legally constitutes a single enterprise and the entire enterprise employs a total of 100 or more employees. B. All federal contractors (private employers) who: (1) are not exempt as provided for by 41 CFR 60-1.5 (2) have 50 or more employees and (a) are prime contractors or first-tier subcontractors and have a contract subcontract or purchase order amounting to $50000 or more or (b) serve as a depository of Government funds in any amount or (c) is a financial institution which is an issuing and paying agent for U.S. Savings Bonds and Notes. All multi-establishment employers i.e. employers doing business at more than one establishment must file: (1) a report covering the principal or headquarters office (2) a separate report for each establishment employing 50 or more persons (3) a consolidated report that MUST include ALL employees by race sex and job category in establishments with 50 or more employees as well as establishments with fewer than 50 employees and (4) a list showing the name address total employment and major activity for each establishment employ-ing fewer than 50 persons must accompany the consolidated report. All forms for a multi-establishment company must be collected by the headquarters office for its establishments or by the parent corporation for its subsidiary holdings and submitted in one package. For the purposes of this report the term parent corporation refers to any corporation which owns all or the majority stock of another corporation so that the latter stands in the relation to it of a subsidiary. The OFCCP has always held that subsidiary companies that do not have direct govt contracts must comply with AAP regulations if the parent company or other subsidiary companies benefit from government contracts. Their line of thought is that the subsidiary without government contracts benefits indirectly from the contract as well. If GSP is completely free standing and they do not participate in Enron's benefits abide by our policies or procedures participate in our bonus process that may partially or wholly be funded by Enron Corp. etc. they may have some type of argement not to comply but I doubt it. If we own them over 51% I don't see a way they could not file EEO-1's and have an AAP. We do all the AAP's in Corporate so if this is a freestanding Business Unit I need to know. Thanks! Felecia Michelle Cash@ECT 11/01/2000 07:49 PM To: Felecia Acevedo/Corp/Enron@Enron cc: Subject: Privileged and Confidential communication to my attorneys Felicia Does this sound right to you? Just wanted to confirm. Thanks. Michelle ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Rice Letter Body:: Anita Very minor changes. Thanks. Vince What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Wind Policy Meeting Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Enron Support of a Standards Setting Organization Body:: I have reviewed the SSO principles -- look good to me. Thanks for sending them to look at. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: HOOVER INSTITUTION NEWS ADVISORY: Conference on the California Electricity Problem Body:: H o o v e r I n s t i t u t i o n News Advisory September 27 2001 _____ FOR IMMEDIATE RELEASE Note: The complete text of this News Advisory can also be viewed in the attached file. CONFERENCE ON THE CALIFORNIA ELECTRICITY PROBLEM October 18-19 2001 Sponsored by the Hoover Institution and Stanford Institute for Economic Policy Research (SIEPR) What: A conference on California's electricity problem sponsored by the Hoover Institution and Stanford Institute for Economic Policy Research (SIEPR). When: Thursday and Friday October 18-19 2001 Where: Stauffer Auditorium Hoover Institution Stanford University Why: To address the causes of and solutions to the problem including: its impact on the state economy deregulation issues and politics. Who: ????????The Honorable Spencer Abraham U. S. Secretary of Energy dinner speaker 6:30 p.m. October 18 ????????Discussion: Electricity problem's causes and proposed solution with James Sweeney of SIEPR Hoover and Stanford and Severin Borenstein of UC-Berkeley 1:15 p.m. October 18 ????????Discussion: I. The electricity problem's impact on the state economy with Edward Leamer of UCLA 3 p.m. October 18 ????????Discussion: II. Achieving competition through real time pricing with Frank Wolak of Stanford and SIEPR and Vernon Smith of George Mason University 3 p.m. October 18 ????????Panel: Power production and politics with John Bryson Edison International Peter Cartwright of Calpine Corporation and Hoover fellow and former California Governor Pete Wilson 8:30 a.m. October 19 ????????Panel: Deregulation with Hoover fellows Milton Friedman Nobel laureate former U.S. Secretary of State George P. Shultz and James Sweeney 10:30 a.m. October 19 A mult box will be available for broadcast media. RSVP by October 15: Call Public Affairs at the Hoover Institution at 650-723-0603. Michele M. Horaney APR Michelle Mosman Director of Communications Public Affairs Manager Stanford Institute for Economic Policy Research (SIEPR) Hoover Institution 579 Serra Mall@Galvez St. Stanford University Stanford University Stanford CA 94305-6010 Stanford CA 94305-6015 650-725-7293 F:650-8611 650-725-1872 cell: 650-722-0798 Horaney@Hoover.Stanford.edu mmosman@stanford.edu Hoover.Stanford.edu siepr@Stanford.edu What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Dinner next week with Piotr Body:: Czwartek mi odpowiada. Zadzwonie do Ciebie do pracy we wtorek. Wicek What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Senate passes Alper/Davis Bill 30-0 Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Mtg w/Bob Gee Body:: I think this is a great initiative but it is critically important that any announcement of the panel makes it crystal clear that the objective of the group is to come up with standards to facilitiate competition. We will do nothing but waste time if it becomes a negotiation over competition. the best and politically easiest time to make that objective clear is in the original announcement not after the group gets underway. Can we get in touch with DOE to make sure they pick this up? Cynthia Sandherr@ENRON 07/18/2000 05:03 PM To: Jeff Brown/HOU/EES@EES cc: Stanley Horton/Corp/Enron@Enron Shelley Corman/ET&S/Enron@ENRON Joe Hartsoe/Corp/Enron@ENRON Steven J Kean/HOU/EES@EES Richard Shapiro/HOU/EES@EES James D Steffes/HOU/EES@EES Janine Migden/DUB/EES@EES Jeff Dasovich/SFO/EES@EES Subject: Re: Mtg w/Bob Gee Jeff: I have followed up with other DOE politicals who advised they will meet this Thursday with Bob Gee to finalize and approve his speech to NARUC on Monday July 24th. It is looking positive that he may be positioned to make the announcement Monday. However DOE will likely need to revisit some folks on the current Blue Ribbon Reliability Panel in order to replace some of the utility transmission-only focused members with others who focus on business practices plus add additional people to represent the internet like APX Altra and HoustonStreet.Com. (these are Steve Kean's suggestions.) Too I have been cautioned about referring to the Blue Ribbon Reliability Panel as a model since their timeline was slow but rather suggest the TVA Blue Ribbon Panel model since they were able to issue a report after only four meetings. I have asked for this issue to be brought to Secretary Richardson's attention and advised this will be done this week. I have also discussed this with John Anderson of ELCON who is supportive. Jeff Brown@EES 07/18/2000 12:45 PM To: Stanley Horton/Corp/Enron@Enron Shelley Corman/ET&S/Enron@ENRON Joe Hartsoe/Corp/Enron@ENRON Steven J Kean/HOU/EES@EES Richard Shapiro/HOU/EES@EES James D Steffes/HOU/EES@EES cc: Cynthia Sandherr/Corp/Enron@ENRON Janine Migden/DUB/EES@EES Jeff Dasovich/SFO/EES@EES Subject: Mtg w/Bob Gee Cynthia and I met with Bob Gee regarding a potential role for DOE in creating a national standards board. Bob appeared comfortable with establishing a Blue Ribbon panel similar to the reliability panel to address this issue. In fact Bob suggested that the reliability panel which includes a balance of key stakeholders could be re-tasked with this issue. We recommended that the focus of any panel should be on the structure (governance segments executive committees) and scope of the organization (retail wholesale gas electric). Bob plans to follow-up with us next week. Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Shift May Empower California.htm Body:: Thanks for taking time to call yesterday. Good luck with the Lockyer situ= ation. I truly do believe that direct and prompt interaction with Lockyer= will prove more effective for Enron than delayed or intermediated action.= As we discussed if I can be of any help with reconnaissance or as sou= nding board just let me know. =20 I have attached an article from this morning's LA Times. It provides an C= alifornia view on how the shakeup in the Senate might impact the state's e= nergy situation. Certainly by the time that President Bush visits the C= alifornia in a few days the state's two Democratic US Senators will be a = good bit more empowered. =20 Kevin 213-926-2626 =20 [IMAGE] [IMAGE][IMAGE] =09Click here to learn more! [IMAGE]=09 [IMAGE] =09Home | Discussions | Print Edition | Archives | Site Map = | Home Delivery | Advertise | Feedback | Help [IMAGE]=09 =09[IMAGE]=09 [IMAGE] [IMAGE] [IMAGE] [IMAGE] News Politics Entertainment music = movies art TV restaurants [IMAGE] Business Travel Marketplace jo= bs homes cars rentals classifieds [IMAGE] Sports Commentary Shop= ping [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] A Section= [IMAGE] [IMAGE] TOP STORIES * State's Standardized Test Spurs Scatte= red Backlash * GOP Braces for Jeffords to Bolt Today * Moderates on = Outside of GOP Big Tent MORE [IMAGE] [IMAGE] [IMAGE] STORIES BY DA= TE FOR THIS SECTION 5/24 | 5/23 | 5/22 | 5/21 | 5/20 | 5/19 | 5/18 = [IMAGE] DAILY SECTIONS Front Page A Section California [= IMAGE] Business Sports Calendar [IMAGE] So. Cal. Living EditorialsLett= ers Op/Ed WEEKLY SECTIONS Health Food [IMAGE] Tech Times [IMAG= E] Highway 1 SUNDAY SECTIONS Book Review Opinion Real Estate [IMA= GE] Calendar Magazine Travel [IMAGE] TV Times Work Place [IMAGE] [= IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Marketplace Find a home car = rental job pet merchandise boat plane or RV classifieds Pl= ace an Ad [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] L.A. Times = Subscription Services Subscribe Change of Address Vacation Stops = Suspend Delivery College Discount Gift Subscriptions Mail Subscriptio= ns FAQ [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Print Ads = from the Newspaper See this week's ads [IMAGE] [IMAGE] [IMAGE] Pri= nt Edition Orange County Valley Ventura County National Communi= ty Papers [IMAGE] [IMAGE] [IMAGE] [IMAGE] Books Columnists Cross= word Education Food Health Highway Horoscope Lottery Magazine = Obituaries Reading by Real Estate Religion Science So.Cal. Living = Special Reports Sunday Opinion Tech Times Times Poll Traffic Weath= er Workplace SITE MAP [IMAGE] [IMAGE] [IMAGE] SHOP 'TIL YOUR = LAPTOP DROPS [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Shopping [IMAGE= ] Search Products Stores [IMAGE] [IMAGE] [IMAGE] [IMAGE] = [IMAGE] [IMAGE] =09[IMAGE]=09[IMAGE] Thursday May 24 2001 | [IMAGE]Print= this story [IMAGE] [IMAGE] Shift May Empower California By RICHARD SI= MON ELIZABETH SHOGREN Times Staff Writers WASHINGTON--James M. J= effords has never mattered much to Californians. Until now. The Verm= ont senator's widely anticipated decision to abandon his fellow Republican= s and put Democrats in control of the Senate could have big implications f= or California particularly on energy and environmental policy lawmakers = and lobbyists said Wednesday. The change which Jeffords is expected= to announce today could increase political pressure on the Bush adminis= tration to respond more aggressively to California's electricity crisis t= hese insiders said. And it might force the White House to compromise= on key elements of the national energy policy it unveiled last week. In f= act the administration's proposed budget cuts for programs to promote ren= ewable energy were said to be a factor in Jeffords' decision. At th= e very least Senate observers said Sen. Dianne Feinstein (D-Calif.) is l= ikely to get the floor vote she has sought on price controls for wholesale= electricity. That doesn't necessarily mean that the administration'= s critics will be able to have everything their way. Even if the Senate ap= proves electricity price caps for example the measure would face stiff o= pposition in the GOP-dominated House--and a likely veto if it made it to t= he president's desk. Still a Democratic majority in the Senate wou= ld give Feinstein and other party members a platform to turn up the politi= cal heat on the administration and congressional Republicans on energy pol= icy. It kicks up the dust groaned one energy industry lobbyist wh= o requested anonymity. Observed Sen. John F. Kerry (D-Mass.): If P= resident Bush's hard-edged conservative approach has in fact caused the ba= lance to shift towards Democrats in the Senate it will have profound impl= ications not just for California but for the environment and our nation's= energy policy. Environmentalists seemed almost giddy as they cont= emplated the possible impact of Jeffords' decision on the policies they ca= re about. All of a sudden they said it seems less likely that oil = exploration will take place in the Arctic National Wildlife Refuge that r= ecreational snowmobiles will have free access to Yellowstone National Park= or that the administration's desire to promote nuclear power will be emb= raced by Congress. On the other hand it seems more probable that C= ongress would approve a new plan for managing a vast swath of the Sierra N= evada to protect the region's oldest trees consider legislation to restri= ct emissions of carbon dioxide from power plants and protect California fr= om a resurgence of offshore oil drilling. It's stunning how broad t= he repercussions are particularly on the environment said Gregory Wetst= one of the Natural Resources Defense Council. We're trying not to count o= ur chickens before they hatch. But it will be easier for us in our battles= at least to keep from moving backwards. For instance Jeffords is= a chief advocate of a bill that would regulate carbon dioxide from power = plants. And if events play out as expected he'll become the new chairman = of the Senate committee with jurisdiction over the issue. Another i= ssue under his purview would be the two-decade dispute over a proposed rep= ository for the nation's spent nuclear fuel at Yucca Mountain in Nevada. = Yucca Mountain is a dead turkey declared Michael Francis of the W= ilderness Society. Environmentalists had been worried that a number= of pro-development provisions would be packed into appropriation bills. B= ut with Democratic senators in charge that would become less of a threat= they said. Every wacko idea Republicans have will get a higher lev= el of scrutiny Francis said. The biggest change would be the power= of Senate Democrats to decide which bills will be considered in committee= s and which ones will make it to the floor of the Senate for votes. = As part of a new Democratic majority Feinstein and fellow California De= mocrat Barbara Boxer are likely to gain leverage with the administration o= n a number of issues considered important to the state. That transl= ates into more federal assistance for California across the board predic= ted Steve Maviglio spokesman for Gov. Gray Davis. I think it mean= s more attention to our state for sure Boxer said. Right now the pres= ident doesn't seem to give a darn. They're all looking at California as a = Democratic state. They're not interested. Feinstein who has been = unable to arrange a meeting with Bush to discuss the energy crisis may ge= t better treatment if winning Democratic support becomes more important to= the administration. She has been regarded as a bridge-builder who worked = effectively with Republicans in the past. This has not been a warm = and friendly administration she complained Wednesday. They've got peopl= e who know all the answers and don't want to listen. The White Hou= se disputed that. In fact Bush agreed Wednesday to meet with Davis during= the president's first visit to California next week. Under a Democ= ratic majority Feinstein would be in line to chair two subcommittees: the= military construction panel of the Senate Appropriations Committee and t= he technology terrorism and government information subcommittee of the Se= nate Judiciary Committee. Boxer would be in line to chair the subco= mmittee on Superfund waste control and risk assessment and the Foreign R= elations subcommittee on international operations and terrorism. Mav= iglio predicted that the effects of Jeffords' expected party defection wou= ld be felt immediately. The chairmanship of the Senate Energy and N= atural Resources Committee would be taken away from Frank H. Murkowski (R-= Alaska) who has been openly hostile to California's plight and handed = to Jeff Bingaman (D-N.M.) who supports Davis' request for electricity pri= ce controls according to Maviglio. Democrats have assailed Bush's e= nergy plan for tilting heavily toward the supply side. With Democrats in c= harge of the Senate the administration would be more likely to compromise= perhaps beefing up funding for Democrat-supported causes such as increas= ed energy assistance to low-income households and more aggressive promotio= n of conservation and renewable energy sources such as wind and solar powe= r. Search the archives of the Los Angeles Times for similar stories ab= out: United States - Politics Republican Party James M Jeffords P= olitical Party Defections California - Politics Senate (U.s.) . You = will not be charged to look for stories only to retrieve one. =09 News Politics Entertainment music movies art TV restaurants = [IMAGE] Business Travel Marketplace jobs homes cars rentals cla= ssifieds [IMAGE] Sports Commentary Shopping [IMAGE] =09[IMAGE]=09 G= et Copyright Clearance Copyright 2001 Los Angeles Times Click for permi= ssion to reprint (PRC# 1.528.2001_000043610) =09 [IMAGE] =09 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Presentation to faculty and students at Berkeley Body:: Maureen -- please send Vince my California testimony and the talking point presentation for Jeff Skilling at the National Press Club. Eliz-- keep Vince on the distribution list for the documents we are generating now to repond to the California situation. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential Contact data and RFI Body:: Any nuclear specific info? Kevin Presto UBS Warburg Energy kevin.presto@ubswenergy.com Phone: 713-853-5035 Fax: 713-646-8272 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Minutes from last Thurs CAISO Board Meeting (Sorry for the delay) Body:: CAISO BOG 10/25/01 Notes taken by G. Alan Comnes Meeting went from about 10:30 to 1 p.m. Written materials discussed at this meeting are available at www.caiso.com/bog. 1. Budget. Board approved budget which contains a significant increase in GMCs and for the first time applies GMC fees on the self provision of A/S. The motion to adopt was modified to say the Board would revisit budget if in response to Gov. Davis requests to par budgets the CAISO budget is cut. 2. Retirement plan Audit 3. Allocation of Above-MCP 487 charges. This mechanism will improve the allocation of OOM costs so that the per-MWh charges match up with actual OOM costs. Stated that penalty revenues used to lower OOM costs could come from imbalance penalties. Action. approved (?) to allow staff to make a tariff amendment on this change. 4. Winter Assessment. Presentation by staff Kahn took issue (i.e. did not even want staff report presented) that CAISO does an assessment without consulting the Power Authority CPUC and the CEC. Worried about conflicting with the other resource assessments out there and giving media ways to take shots at DWR buying practices. In the end the full presentation was not given but questions were asked about whether the assessment spells trouble or provides assurance. The answer: things are tight in some months but are expected to be ok given the level of conservative assumptions used in the analysis. Action: staff was tasked to compare this assessment with CEC's and others and come back in another month. 5. Generator maintenance program. Will use GADS data. This program is mandatory for PGA generator units. CAISO staffer represented that no other ISO has a prescriptive program like the one CAISO is proposing. Current schedule: brief FERC staff next week return to Board in November for approval make FERC filing implement in early '02. Benchmarks are based on each unit's historical performance i.e. dogs will be benchmarked against their past doggy behavior. There is no component to raise the bar on performance but a unit that falls relative to past performance would trigger further review. 6. MSC Selection Committee. MSC provides independent review of the CAISO markets for CAISO the state and FERC. Wolak is the only member left at the moment. Selection committee will be Sheffrin Wolak and Borenstein. Candidates will go to Exec. Director and the final candidates to the Board in February 2002 (!). Kahn questioned how the MSC can survive with only one member and take until February 02 to select a final members. Nonetheless the glacially paced schedule was adopted. 7. FERC RTO Seams Issues. Steve Greenleaf presented. Updated BOG on RTO week and said that the 4 RTO model took a step backward (off the table in the words of Chair Wood) in response to criticism from state PUCs on Thursday. (Is this an accurate recounting of Day 4?). ISO is engaged in interregional coordination. Mentioned CSIC group Mentions SSGWY's (?)sponsorship of a market monitoring workshop on November 16. 8. Update of CERS Settlement BEEP/AS Payment Procedure. Edison and PG&E are making progress but no agreement with CERS have been reached. SDG&E signed and the procedure was implemented at least in part with SDG&E. 9. Monthly reports: financial. 10. Monthly reports: DMA. Sheffrin. Mostly followed the briefing charts. Emphasized the following: CERS OOM purchases are generally down and are reasonably priced once purchases and sales are disaggregated. Said that suppliers are still bidding above costs. DMA files confidential reports that include info on bidding data weekly to FERC. Bids are not coming down. Intrazonal congestion is up due to new generation coming on line. That allows generators to play the dec game. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Bay City News Wed 3/21: Blackouts Not Expected=20 Today Dow Jones Newswire Wed 3/21: Calif State Controller:General Fund Surplus = Dn=20 To $3.2B CBS.MarketWatch.com Wed 3/21: Davis says regulators will act to pay QFs Electricity providers insist they need to be paid Long Beach Press Wed 3/21: Rash power bill may need fix SF Chron Wed 3/21: PUC considers rewarding producers that sign long-term= =20 contracts Sac Bee Thurs 3/22: State claims $5.5 billion overcharge: Refunds by=20 wholesale generators sought Sac Bee Thurs 3/22: Power solution eludes Davis: Lawmakers grow edgy as= =20 crisis drags on Sac Bee Thurs. 3/22: Legislators learn some details of power contracts= San Diego Union Thurs 3/22: Federal judge orders major power wholesaler= =20 to sell to California San Diego Union Thurs. 3/22: Controller: State's power spending imperil= s=20 its financial health San Diego Union Wed 3/21: Governor says utilities must pay in advance f= or=20 some power LA Times Thurs 3/22: Energy Overcharge of $5.5 Billion Is Alleged LA Times Thurs 3/22: Power Strain Eases but Concerns Mount LA Times Thurs 3/22: Graphics: Overcharges Alleged=20 San Fran Chron Thurs 3/22: Net Complex A Dilemma For San Jose=20 SERVER FARM: Plant would tax grid San Fran Chron Thurs 3/22: Contracts Won't Meet Summer Demands=20 DETAILS: 2004 before full impact felt Mercury News Thurs 3/22: California overcharged $5.5 bln for wholesale= =20 power Orange Cty Register Thurs 3/22: Commentary: If the Power Goes Off =20 Orange Cty Register Thurs 3/22: Commentary: Socialized Electricity San Fran Chron Thurs 3/22: Bush's Energy Policy Will Backfire=20 Feinstein Warns / She wants federal price controls now Dow Jones Newswires Thurs 3/22: Reliant Still In Power Pact Talks With= =20 Calif. DWR Dow Jones Newswires Thurs 3/22: CPUC Must Address Rates In QF Repayment= =20 Order - SoCal Ed Dow Jones Newswires Thurs 3/22: Calif Small Pwr Producers To Shut Plant= s=20 If Rates Capped --- --- Blackouts Not Expected=20 Today Bay City News=20 Following two consecutive days of rolling blackouts California's power=20 picture looks much brighter today but conservation is still needed.=20 The California Independent System Operator is urging consumers to continue= =20 conservation measures during today's Stage One Electrical Emergency.=20 The conservation efforts of Californians particularly Tuesday evening we= re=20 significant and helped to reduce the duration and impact of yesterday's=20 blackouts'' according to officials. The California ISO asks customers to= =20 continue their voluntary reductions during this time of tight supply.=20 More than 11500 megawatts of in-state generation remain unavailable with= =20 power plants completing repairs and needed maintenance. However several=20 generating units returned to service today and the level of imported power= =20 has increased boosting the supply.=20 The ISO is cautiously optimistic that customer outages will be avoided=20 today'' according to officials.=20 Today's Stage One alert is in effect through midnight tonight.=20 Stage One Emergencies are declared when power reserves fall below 7 percent= .=20 Stage Two kicks in when reserves fall below 5 percent. Stage Three is=20 initiated when reserves drop to below 1.5 percent. --- Calif State Controller:General Fund Surplus Dn To $3.2B 03/21/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LOS ANGELES -(Dow Jones)- California State Controller Kathleen Connell=20 Wednesday said the state's general fund surplus has dropped to $3.2 billion= =20 from $8.5 billion in January mostly because of electricity purchases made = by=20 the state's Department of Water Resources a press release said.=20 Connell also denied Gov. Gray Davis' request to transfer an additional $5.6= =20 billion from the general fund to the Special Fund for Economic Uncertaintie= s=20 the release said. Connell noted that given the rapid depletion of the general fund on power= =20 purchases the state would need to borrow $2.4 billion in order to tranfer= =20 the $5.6 billion from the general fund to the special fund.=20 We started this year with a generous budget surplus. The energy crisis has= =20 taken much of that away and this transfer on top of the electricity=20 purchases would put the fund at risk Connell said.=20 Connell called on Davis to ensure that the CDWR completes by the end of May= =20 2001 the revenue bond sales that will be used to buy power and repay the=20 general fund.=20 She also asked that the CDWR notify her of all power purchases made and=20 contracts negotiated thus far and requested that she be told within 7 days = of=20 any purchases and contracts negotiated in the future.=20 Connell also said she wanted to be told within 24 hours of any power buys= =20 that exceed $55 million and asked that the Department of Finance be directe= d=20 to prepare new general fund cash flow estimates for the next 30 and 60 days= =20 and for the end of the fiscal year.=20 The state's Department of Water Resources has been buying power since Janua= ry=20 in lieu of Edison International (EIX) utility Southern California Edison an= d=20 PG&E Corp (PCG) utility Pacific Gas and Electric Co because suppliers=20 refused to sell to the nearly-bankrupt utilities.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 Gov. Davis' office said in response to Connell's comments that the state= =20 budget was solid and the economy remained strong.=20 We will be getting the money back we've paid for energy and it should have= =20 no significant effect on the state's finances from the Wall Street=20 perspective said Davis press secretary Steve Maviglio.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 jessicaberthold@dowjones.com --- -------- Davis says regulators will act to pay QFs Electricity providers insist they need to be paid By Russ Britt CBS.MarketWatch.com=20 Last Update: 9:45 PM ET Mar 20 2001 LOS ANGELES (CBS.MW) - California Gov. Gray Davis said regulators will act= =20 Tuesday on a plan to guarantee that independent power generators are paid. Independent power producers provide about 30 percent of California's=20 electricity from a variety of sources including wind solar and other=20 sources. Because many of the companies known as Qualifying Facilities or= =20 QFs haven't been paid they've begun to withhold power contributing to=20 blackouts in the state Monday and Tuesday.=20 We are anxious to pay the QFs because they're falling like flies Davis= =20 said at a news conference late Tuesday. If they don't get paid the lights= =20 will go out. Davis said the state's PUC order will require the state's nearly bankrupt= =20 utilities to enter five-year contracts with the QFs at rates of 7.9 cents p= er=20 kilowatt hour or 10-year contracts for lower rates. The structure is simil= ar=20 to rates Davis claims he was able to negotiate for long-term power contract= s=20 from out-of-state generators. --- Rash power bill may need fix By Will Shuck From our Sacramento Bureau SACRAMENTO Even as lawmakers lament the slow pace of solving California's= =20 energy crisis the cost of haste has cropped up in their first major act a= =20 multibillion dollar measure that put the state in the power-buying business= .=20 AB1X the highly touted bill that put California in the power-buying=20 business may have been so rashly crafted that it will take another piece o= f=20 legislation to fix it an influential senator said Tuesday.=20 At issue is vague wording that makes it unclear when and to what extent=20 Southern California Edison and other utilities have to repay the state for= =20 buying power.=20 State Sen. Debra Bowen chairwoman of the Senate Energy Utilities and=20 Communications Committee said the bill apparently has left room for utilit= y=20 lawyers to argue that their companies needn't repay the state until they ha= ve=20 covered other costs.=20 But Bowen a Redondo Beach Democrat who represents downtown and western Lon= g=20 Beach said the legislative intent is crystal clear that the state wanted= =20 to be repaid directly for supplying about a third of the power utility=20 companies deliver to their customers.=20 We need a cleanup bill to set the matter straight she said.=20 Although AB1X illustrates the flaws that come with speed Bowen said the= =20 Legislature can't afford to delay.=20 I think we are much too slow in our response she said. But that has to = be=20 balanced against things we've done in a tearing hurry and then have had to= =20 fix later.=20 No matter what the Legislature does in the coming weeks she said Californ= ia=20 is in for a tough summer and only determined conservation efforts will put= =20 much of a dent in a precarious supply-demand equation. --- PUC considers rewarding producers that sign long-term contracts=20 Greg Lucas Lynda Gledhill Chronicle Sacramento Bureau Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 Sacramento -- Some cash-strapped producers of wind solar and other=20 alternative forms of energy will get long-delayed financial relief under a= =20 proposed order by state regulators Gov. Gray Davis said yesterday evening.= =20 A proposed order by the Public Utilities Commission is designed to reward= =20 energy producers who sign long-term contracts with utilities at lower rates= .=20 Alternative energy producers that voluntarily enter such contracts which= =20 would start on April 1 would be paid within 15 days said Davis who=20 requested the order. Those that do not would have to wait until the utiliti= es=20 that buy their power return to solvency.=20 Davis blasted Pacific Gas & Electric Co. and Southern California Edison for= =20 not paying the alternative generators -- know as qualified facilities or= =20 QFs -- even though the companies have been collecting money through rates= .=20 It is wrong and irresponsible of the utilities to pocket and withhold the= =20 money designed to compensate the QFs Davis said. It's immoral and has to= =20 stop.=20 Alternative producers -- ranging from massive co-generation facilities at o= il=20 refineries to tiny biomass plants -- produce about a third of the state's= =20 supply of electricity. But many are shutting down because utilities have no= t=20 paid them since November.=20 The loss of some 3000 megawatts from tapped-out alternative energy produce= rs=20 contributed to the blackouts that snarled California yesterday and Monday= =20 according to the Independent System Operator which manages the state's pow= er=20 grid.=20 The PUC's proposed order -- which will be considered at the board's Tuesday= =20 meeting -- offers the generators a choice of agreeing to a five-year contra= ct=20 at $79 per megawatt or a 10-year deal at $69 per megawatt Davis said.=20 The order does not address the more than $1 billion already owed to the mor= e=20 than 600 alternative energy producers around the state. Davis said to favor= =20 one creditor over another in past debt could bring on bankruptcy proceeding= s=20 from other creditors.=20 The Legislature would also need to act to make the order work.=20 It is critical to keep these facilities up and online said Sen. Debra=20 Bowen D-Marina del Ray who estimates that Edison has $1.5 billion in cash= =20 on hand and PG&E $2.5 billion. The utilities owe it to the people of the= =20 state to pay them.=20 Edison said yesterday that it opposed any attempt to place alternative=20 producers ahead of their other creditors.=20 But Tom Higgins a senior vice president for Edison International which ow= es=20 alternative producers some $835 million said his company was talking to th= e=20 governor's office about possible payment structures.=20 Alternative energy producers particularly those that use high-priced natur= al=20 gas to fire their generators say that without an immediate infusion of cas= h=20 they must close their plants.=20 We've been obsessed with the health of the utilities and (have) forgotten= =20 the health of everyone else said V. John White legislative director of t= he=20 Clean Power Campaign which lobbies for alternative energy producers.=20 CalEnergy Operating Corp. which operates eight geothermal plants in the=20 Imperial Valley producing 268 megawatt hours for Edison has sued the utilit= y=20 asking to be paid and to be temporarily released from their contract with= =20 Edison which has paid them nothing since November.=20 CalEnergy has a court hearing tomorrow on its Edison contract. Edison owes= =20 the company $75 million and the debt increases by $1 million a day.=20 We've lived up to our end of the bargain but Edison hasn't. We're now not = in=20 a position to make a property tax payment on April 10 and we're the largest= =20 employer in the county said Vince Signorotti CalEnergy's property manage= r.=20 Unlike Edison PG&E is paying its creditors 15 cents on the dollar.=20 We have offered over the past five days to prepay for future power not yet= =20 delivered to keep as many of them operating as possible but the state need= s=20 to decide how its going to divvy up the limited money under the frozen=20 rates said John Nelson a PG&E spokesman.=20 The PUC's sudden attempt to recast the rates paid to alternative generators= =20 comes after several months of inaction partly a result of waiting for=20 legislative negotiations on the issue to conclude. Those negotiations=20 eventually failed to move forward.=20 --- State claims $5.5 billion overcharge: Refunds by wholesale generators sough= t By Dale Kasler Bee Staff Writer (Published March 22 2001)=20 In its boldest attempt yet to extract refunds from wholesale power=20 generators the state's grid operator accused the generators Wednesday of= =20 overcharging Californians by $5.5 billion for electricity since last May.= =20 The state's Independent System Operator which manages the state's=20 transmission grid plans to tell a federal regulatory agency today that pow= er=20 generators consistently took advantage of their stranglehold on the=20 California market to ratchet up prices.=20 The federal agency the Federal Energy Regulatory Commission recently=20 threatened to order generators to refund $134.8 million for overcharges=20 mostly covering January and February. But those refunds amounted to just a= =20 fraction of what the grid operator was seeking. The ISO which has been=20 complaining about market abuses for several months says FERC must do more.= =20 We're happy that (FERC) took this first step but we think there's a long= =20 way to go said Anjali Sheffrin the ISO's director of market analysis. A= s=20 far as I'm concerned it's been too little too late. ... The refunds they= =20 have acted on (so far) have been minimal.=20 She said the report covers five major power suppliers and 16 other power=20 importers.=20 FERC Commissioner William L. Massey said it would be improper for him to=20 comment on a report that has not yet been filed. But when told of the $5.5= =20 billion total Massey told the Los Angeles Times: That doesn't shock me in= =20 any way.=20 Prices over the past 10 months in California have greatly exceeded the=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said.=20 However most FERC critics are skeptical that the federal agency which is = a=20 strong believer in letting free markets run their course would order a=20 refund anywhere near as large as $5.5 billion -- even though it has found= =20 that California prices at times have been unjust and unreasonable.=20 The big power generators saying their charges were reasonable are disputi= ng=20 the $134.8 million refunds proposed so far and have vowed to fight the ISO'= s=20 latest effort.=20 If the ISO were to prevail the $5.5 billion in refunds could go a long way= =20 toward remedying California's energy mess.=20 They could help restore the financial health of Pacific Gas and Electric Co= .=20 and Southern California Edison which have nearly been bankrupted by the=20 prices charged by the power generators. They also could ease the strain on= =20 the state treasury which is spending billions to purchase electricity for= =20 Californians because PG&E and Edison can't.=20 Sheffrin said her department studied sales made by the power generators to= =20 ISO which makes last-minute power purchases to balance supply with demand= =20 and the California Power Exchange the now-bankrupt entity where most of=20 California's wholesale electricity was bought and sold until December.=20 She said the study made very generous allowances for natural gas expenses= =20 costly air-pollution credits and other factors including the scarcity of= =20 electricity. The result was $5.5 billion worth of charges in excess of=20 competitive costs she said.=20 In many cases the companies used their market clout to submit bids that we= re=20 way beyond their costs she said.=20 It was insufficient competition Sheffrin said. They got away with a lot= .=20 She said the refund request isn't just a shot in the dark. FERC she noted= =20 has already found that prices in the California wholesale energy market ha= ve=20 been unreasonable. We took it upon ourselves ... to show FERC how they got = to=20 be so high.=20 FERC proposed refunds totaling $124 million for January and February sales= =20 declaring that generators' prices were too high.=20 In a separate case the federal agency for the first time accused two=20 generators last week of taking plants offline to force prices up.=20 --- Power solution eludes Davis: Lawmakers grow edgy as crisis drags on=20 By Emily Bazar and Amy Chance Bee Capitol Bureau (Published March 22 2001)=20 Gov. Gray Davis likes to compare the state's energy crisis to a complicated= =20 three-cornered billiard shot.=20 But as California plunged into another round of power blackouts this week= =20 Davis has yet to line up the angle on an ultimate solution.=20 The state's short-term power bill is nearing $4.2 billion and legislators= =20 are balking at the administration's requests for additional money.=20 Getting even the least controversial pieces of the puzzle through the=20 Legislature is taking weeks longer than expected.=20 While the Democratic governor has insisted secrecy about details of his pow= er=20 purchases is necessary to protect the state's bargaining position other=20 state officials are complaining vigorously about the lack of information.= =20 And critical deals the governor hoped to reach with energy suppliers and=20 utility companies are proving difficult to close.=20 I think we all got lulled into a little complacency a few weeks ago. All= =20 these things seemed to be going along and the governor was making all thes= e=20 warm and fuzzy comments said Assemblyman John Campbell R-Irvine.=20 But it only takes one deal to go sideways and we're all blacked out he= =20 added. The governor is running around basically saying 'Trust me.' I'm no= t=20 sure he's deserving of the trust at this point.=20 Davis and his aides insist they are working around the clock on plans to=20 boost power generation encourage conservation and reach an agreement with= =20 utilities that will keep them out of bankruptcy.=20 The utility plan they say is the equivalent of a large corporate merger= =20 that simply can't be accomplished overnight. Davis notes that earlier=20 deregulation efforts might have benefitted from a little more time.=20 Although the state has reached a broad agreement in principle with Southe= rn=20 California Edison to obtain its power transmission lines in exchange for he= lp=20 paying off its debts a final detailed deal has not been reached. The=20 initial agreement with Edison was announced Feb. 23.=20 And the governor has yet to achieve a tentative agreement with Pacific Gas= =20 and Electric Co. which is driving a harder bargain over price and other=20 elements of a potential rescue plan.=20 Joseph Fichera one of several consultants receiving more than $11 million= =20 from the administration for advice on the energy crisis said many people= =20 don't realize the complexity of the deal they're brokering.=20 In their bid to achieve a public takeover of the investor-owned utilities'= =20 transmission lines he said negotiators have to pore over thousands of=20 documents related to the transmission lines alone.=20 We are doing what is normal in a transaction of this magnitude which is= =20 investigate document circulate redocument agree move forward said=20 Fichera an investment banker with Saber Partners in New York City. The=20 governor has put a 'I want this yesterday' fire under his negotiating team= .=20 The negotiator however declined to say when he expects final agreements t= o=20 be reached with the companies.=20 It could be days it could be weeks he said.=20 There were signs meanwhile of trouble brewing on another front: the giant= =20 bond sale the state must make to repay the money it has spent so far on=20 electricity and to finance future long-term contracts for energy.=20 State Treasurer Phil Angelides said Wednesday the utilities are appealing a= =20 ruling by the state Public Utilities Commission that essentially ensures th= e=20 state will be repaid a move that he said threatens to delay the sale=20 indefinitely.=20 If the utilities have decided to adopt a scorched earth policy until they= =20 get what they need and want then it will be a significant problem=20 Angelides said.=20 PG&E spokesman Ron Low said the governor is simply placing too many demands= =20 on a rate structure that doesn't compensate the utilities for their current= =20 costs.=20 Political rhetoric is not going to change the math he said.=20 In the Legislature lawmakers are growing grumpier. Most were taken by=20 surprise Monday when blackouts were ordered across the state weeks before= =20 summer temperatures were expected to set in and strain the power system.=20 I'm more worried than ever said Assemblyman Bill Leonard R-San=20 Bernardino. A lot of the elements we thought we had a handle on in January= =20 are unraveling.=20 A deal the governor said had been worked out weeks ago between the state an= d=20 more than 600 small alternative energy suppliers collapsed last week.=20 The alternative generators have not been paid by the utilities for months= =20 and state leaders attempted to bargain down the price utilities pay those= =20 generators for power.=20 But administration officials complained privately that lawmakers instead=20 sweetened the pot for the suppliers to the point that the measure no longer= =20 helped solve the overall financial situation pushing the utilities toward= =20 bankruptcy. Under a proposal announced Tuesday by Davis the Legislature=20 would authorize the PUC to require the utilities to pay the alternative=20 suppliers at prices more closely resembling the original deal.=20 But the governor ran into immediate opposition as some suppliers said said= =20 he would not pay them enough to cover their fuel costs.=20 We would go from not being paid to losing money said Hal Dittmer of=20 Wellhead Electric a Sacramento-based supplier that has been shut down for= =20 more than a month. Almost everybody who burns natural gas is going to shut= =20 down. (Davis) got it wrong.=20 Democrats outside the Davis administration meanwhile are complaining abou= t=20 the amount of money the state Department of Water Resources is spending on= =20 expensive last-minute power purchases. Within a week $4.2 billion will ha= ve=20 been committed.=20 State Sen. Steve Peace D-El Cajon chairman of the joint Legislative Budge= t=20 Committee is warning the Davis administration that he will block additiona= l=20 funds for last-minute purchases of power until the PUC makes progress=20 recovering money that already has been spent. He intends to hold a hearing = on=20 the issue this morning.=20 On Wednesday state Controller Kathleen Connell told Davis she will refuse = to=20 make a routine budget transfer he had requested saying she is concerned th= at=20 there is no outside check and balance on the money the administration is= =20 spending to buy electricity on the spot market.=20 As the statewide elected official who pays the state's bills Connell said= =20 she has yet to receive information from the Department of Water Resources= =20 about how much it is spending.=20 We really need an accounting as to the total amount of liability they have= =20 accumulated she said. I understand they're in an emergency situation ...= =20 but it begins to imperil the state's ability to manage its cash flow.=20 Meanwhile a bill to provide $1 billion for conservation programs aimed at= =20 reducing power needs this summer also has languished for several weeks in= =20 the state Senate. While Davis has focused his attention elsewhere Republic= an=20 lawmakers have opposed the measure as too expensive. Democrats argue that= =20 each two-week delay prevents the state from saving as much energy as one=20 peaker plant will produce this summer. Peaker plants are designed to help= =20 meet the peaks of electricity demand.=20 I'm the eternal optimist but we have to keep working on all fronts said= =20 Sen. Byron Sher D-Palo Alto who hopes to take his energy conservation bil= l=20 up for a vote in the Senate again today. It's a formidable challenge.=20 Bee staff writer Dale Kasler contributed to this report.=20 --- Legislators learn some details of power contracts By John Hill Bee Capitol Bureau (Published March 22 2001)=20 The veil of secrecy surrounding the state's electricity contracts lifted=20 Wednesday -- a little.=20 Gov. Gray Davis gave state legislators a report laying out some of the=20 details of long-term contracts designed to help the state pull out of its= =20 energy crisis. But the report left legislators and others clamoring for mor= e.=20 The information raises more questions said Assemblyman George Runner=20 R-Lancaster. I liken it to watching a parade through a knothole in a fence= .=20 You get to look at one float but you're not sure about what's coming up an= d=20 what you've missed.=20 Davis had previously disclosed that the state had signed or was close to=20 signing 40 long-term contracts at an average price over 10 years of $69 pe= r=20 megawatt-hour.=20 The contracts are part of the state's strategy for trying to avoid a fiscal= =20 shellacking in the energy spot market while making sure there's enough=20 electricity to avoid more blackouts.=20 Davis also previously disclosed that the contracts were for an average of= =20 about 9000 megawatts a year and that the total cost exceeded $40 billion.= =20 But Davis has resisted telling more saying the state would jeopardize its= =20 ability to get the best prices if electricity generators knew what their=20 counterparts were getting.=20 On Wednesday the governor's office released a March 15 report from S. Davi= d=20 Freeman general manager of the Los Angeles Department of Water and Power = to=20 the state Department of Water Resources. The state agency has been given th= e=20 responsibility of making power purchases and Freeman was brought in to lea= d=20 the negotiations.=20 As of March 15 the state had signed 19 contracts with seven suppliers for= =20 periods ranging from 14 months to 20 years with many for three or five=20 years the report says. Some of the contracts are for electricity to meet t= he=20 state's everyday power demand while others are only for times of peak use= =20 such as hot summer days.=20 The state had agreements in principle for an additional 25 contracts.=20 Runner said he has been told that two of these contracts have since been=20 finalized.=20 The amount of power provided reaches a peak in 2004 of more than 10000=20 megawatts. As the long-term contracts start to expire around then the stat= e=20 is hoping that demand can be met with new contracts or spot purchases at=20 prices expected to be much cheaper.=20 The report says nine more long-term contracts were under discussion.=20 Some of the contracts are with power generators while others are with=20 marketers who may get the power from a number of sources.=20 In some cases the state may supply the natural gas used to generate the=20 electricity or power costs may be pegged to the going rate for the fuel.= =20 Some suppliers can cancel if the state fails to sell bonds by a certain dat= e=20 to cover power costs or fails to maintain an investment grade credit rating= .=20 Some depend on the construction of power plants but Freeman said they were= =20 firm commitments.=20 We were pretty careful not to put a hope and a dream in the portfolio he= =20 said.=20 More contracts will have to be signed to meet summer demand and these=20 agreements will probably be more expensive the report says.=20 One item not in Freeman's report was a secret deal to relieve several major= =20 generators from having to pay for polluting the air beyond allowable limits= .=20 The long-term power contracts include language that would have the state pa= y=20 the costs of pollution credits that allow power plants to exceed their=20 permitted levels of smog-forming pollutants the governor's office confirme= d=20 Wednesday. Spokesman Steve Maviglio said that several generators are being= =20 relieved from having to pay those costs.=20 V. John White a Sierra Club lobbyist close to the negotiations said Dyneg= y=20 Inc. which has power plants in El Segundo Encina and Long Beach is one o= f=20 them. Dynegy officials did not return calls to The Bee on Wednesday.=20 Freeman said that generators were demanding hefty premiums for having to de= al=20 with air quality regulators in the summer and he figured it would be cheape= r=20 just to pay for the pollution credits.=20 In other energy-related developments:=20 With more power plants back online grid operators dropped down to a Stage = 1=20 electricity alert. The state Independent System Operator was expecting=20 supplies to gradually increase over the next few days.=20 The state Public Utilities Commission issued a revised draft decision that= =20 would impose the prices outlined Tuesday by Davis for power produced by=20 alternative energy companies -- $79 a megawatt-hour for five-year contracts= =20 or $69 a megawatt-hour for 10 years. The proposal is scheduled for a PUC vo= te=20 March 27.=20 A federal judge ruled that one of the nation's major electricity generators= =20 must continue supplying California with emergency power.=20 In imposing an injunction on Reliant Energy Services Inc. U.S. District=20 Judge Frank C. Damrell Jr. noted the rolling blackouts (that have) darkene= d=20 the California landscape and said the loss of Reliant's production poses = an=20 imminent threat.=20 Bee staff writers Carrie Peyton Chris Bowman and Denny Walsh contributed t= o=20 this report.=20 --- Federal judge orders major power wholesaler to sell to California=20 By Don Thompson ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) A federal judge issued a preliminary injunction Wednesday= =20 ordering a major electricity wholesaler to continue selling to California= =20 despite its fear that it will not get paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant Energy Services stopped selling power to the=20 Independent System Operator which oversees the state's power grid. The ISO= =20 buys last-minute power on behalf of utilities to fill gaps in supply to try= =20 to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The state has been spending about $50 million a day on power for Pacific Ga= s=20 and Electric Co. and Southern California Edison both denied credit by=20 suppliers after amassing billions of dollars in debts.=20 Controller: State's power spending imperils its financial health=20 Governor says utilities must pay in advance for some power=20 ?=20 The judge said he had no authority to force the DWR to pay for that power.= =20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 Damrell denied the ISO's request for preliminary injunctions against three= =20 other wholesalers Dynegy AES and Williams who agreed to continue selling= =20 to the ISO pending the FERC ruling.=20 The ISO went to court in February after a federal emergency order requiring= =20 the power sales expired. The judge then issued a temporary restraining orde= r=20 requiring the sales but dropped it after the suppliers agreed to continue= =20 sales to California pending his Wednesday ruling.=20 The ISO said it would lose about 3600 megawatts if the suppliers pulled ou= t=20 enough power for about 2.7 million households. One megawatt is enough for= =20 roughly 750 homes.=20 Grid officials said Reliant's share alone is about 3000 megawatts. Reliant= =20 said the amount at issue actually is less than a fourth of that because mo= st=20 of the power is committed under long-term contracts.=20 Reliant which provides about 9 percent of the state's power worries it=20 won't get paid due to the financial troubles of PG&E and Edison.=20 PG&E and Edison say that together they have lost about $13 billion since Ju= ne=20 due to soaring wholesale electricity costs that California's 1996=20 deregulation law bars them from passing onto customers.=20 At the same time the state has faced a tight electricity supply due in pa= rt=20 to California power plant shutdowns for maintenance and to a tight=20 hydroelectric supply in the Pacific Northwest.=20 Managers of the state power grid imposed rolling blackouts across the state= =20 Monday and Tuesday as supply fell short of demand. Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts.=20 State Controller Kathleen Connell said Wednesday that the energy crunch als= o=20 imperils California's financial health.=20 Connell said the state's power-buying on behalf of Edison and PG&E is is=20 gutting its budget surplus. Since the state started making emergency power= =20 buys in January the surplus has fallen from $8.5 billion to about $3.2=20 billion she said.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is refusing a request by Davis and the Legislature to transfer $5.6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its=20 power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= =20 The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 --- Controller: State's power spending imperils its financial health=20 By Don Thompson ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) California's power-buying on behalf of two strapped utiliti= es is=20 gutting its budget surplus and putting the state at financial risk the sta= te=20 controller said Wednesday.=20 The surplus dropped from $8.5 billion in January when the state began buyi= ng=20 electricity for Pacific Gas and Electric Co. and Southern California Edison= =20 to $3.2 billion now Kathleen Connell estimates.=20 Connell ordered an audit of the state's power-buying saying Gov. Gray Davi= s=20 is withholding key financial information from her office and the Legislatur= e.=20 Wednesday marked the first time in three days the state avoided rolling=20 blackouts. Power grid officials credited cooling temperatures and the=20 completion of repairs at several power plants.=20 Connell said the energy crunch now imperils the state's budget as well as i= ts=20 electric grid.=20 California has been spending about $45 million a day =01) $4.2 billion so f= ar =01)=20 to buy power for Edison and PG&E both denied credit by electricity=20 wholesalers.=20 The two utilities California's largest say they are nearly $14 billion in= =20 debt due to soaring wholesale power costs the state's deregulation law bloc= ks=20 them from recovering from customers.=20 Meanwhile the state has faced high natural gas costs and a tight power=20 supply driven in part by power plant repairs in California and scarce=20 hydroelectric power in the Pacific Northwest.=20 Standard & Poor's has put the state on a credit watch due to its power=20 purchases and chastised Davis the Legislature and state regulators for not= =20 taking more aggressive steps to assure the utilities can pay their bills.= =20 On Wednesday Connell said she is refusing a request by Davis and the=20 Legislature to transfer $5.6 billion into a rainy day fund she said was s= et=20 up to impress Wall Street as the state prepares to issue $10 billion in=20 revenue bonds to cover its power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Connell said the scope of the proposed transfer is unprecedented and amount= s=20 to a shell game that disguises the power purchases' impact on the state= =20 budget.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= =20 The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details. He said his= =20 plan may involve giving the utilities low-interest loans with their=20 transmission lines held as collateral.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 --- Governor says utilities must pay in advance for some power=20 By Jennifer Coleman ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) The state's two largest utilities will be ordered to pay=20 environmentally friendly power generators in advance a move Gov. Gray Davi= s=20 hopes will bring a quick end to the power blackouts that darkened Californi= a=20 this week.=20 The statewide blackouts that stretched from San Diego to Oregon on Monday a= nd=20 Tuesday were caused in part by the failure of Southern California Edison an= d=20 Pacific Gas and Electric Co. to pay millions of dollars they owe qualifyin= g=20 facilities or QFs Davis said.=20 Such suppliers use cogeneration =01) steam from manufacturing plus natural = gas =01)=20 or solar wind and other renewable energy to generate electricity. This wee= k=20 California lost about half the power those generators normally provide.=20 Controller: State's power spending imperils its financial health=20 ?=20 Several of them said they hadn't been paid by Edison and PG&E in weeks and= =20 can't afford to keep operating their plants.=20 Davis accused the utilities of taking in money from customers while failing= =20 to pay the QFs. The state has been spending about $45 million a day since= =20 January to buy power for customers of Edison and PG&E which are so=20 credit-poor that suppliers refuse to sell to them.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators the governor said at a Capitol news conference Tuesday= =20 evening. They've acted irresponsibly and immorally and it has to stop.=20 PG&E called the governor's statements inappropriate and unjustified addi= ng=20 that it was negotiating a payment plan with the QFs. Edison said it is inte= nt=20 on paying creditors and working with the California Public Utilities=20 Commission to pay QFs for future power sales.=20 Controller Kathleen Connell warned Wednesday that the state's $2=20 billion-a-month power purchases are jeopardizing California's budget.=20 The state's budget surplus dropped from $8.5 billion in January when the= =20 power purchases began to $3.2 billion now Connell estimates. She blamed= =20 Davis for withholding key financial information and ordered an audit of th= e=20 state's power spending starting next week.=20 She blocked a request by the Legislature and Davis administration to transf= er=20 $5.6 billion from the state's general fund into a special rainy day fund= =20 saying that would have left the general fund $2.4 billion in debt.=20 The Legislative Analyst's Office said such transfers are routine Connell= =20 agreed but said the size of the transfer is unprecedented.=20 We started this year with a generous budget surplus Connell said. The= =20 energy crisis has taken much of that away and this transfer on top of the= =20 electricity purchases would put the fund at risk.=20 Meanwhile keepers of the state's power grid were optimistic California wou= ld=20 get through Wednesday without another day of rolling blackouts. Two plants= =20 down for repairs returned to service.=20 Several power plants that were taken down for repairs are also expected com= e=20 online by the end of the week reducing the likelihood of blackouts said J= im=20 Detmers ISO vice president.=20 Power may flow to homes and businesses but it could soon cost consumers=20 more said Assemblyman Fred Keeley one of the Legislature's leaders on=20 energy issues.=20 I think it's intellectually appropriate and honest to tell people as soon = as=20 it's apparent that a rate increase is warranted the Boulder Creek Democra= t=20 said Tuesday indicating that time had come.=20 He estimated that the state Public Utilities Commission may soon have to=20 raise rates by about 15 percent to cover the state's costs and its utilitie= s'=20 bills.=20 My sense is that people will appreciate having some certainty and being ab= le=20 to plan for it he said. They don't have to like it but I think they'll= =20 appreciate it.=20 Davis said he is confident the utilities and the state can pay their bills= =20 without further rate increases for Edison and PG&E customers.=20 In the meantime the Independent System Operator keeper of the grid is=20 counting on continued conservation by residents and businesses to avoid mor= e=20 blackouts. Conservation accounted for about 300 megawatts in savings during= =20 Tuesday's peak usage enough to power 300000 homes.=20 Roughly a half-million homes and businesses were affected by Tuesday's=20 blackouts which snarled traffic and plunged schools and businesses into=20 darkness across the state.=20 The outages began at 9:30 a.m. and continued in 90-minute waves until about= 2=20 p.m. when the ISO lifted its blackout order. They were blamed for at least= =20 one serious traffic accident.=20 Two cars collided at an intersection in the Los Angeles suburb of South El= =20 Monte where the traffic lights were out. Two people were seriously hurt sa= id=20 California Highway Patrol Officer Nick Vite.=20 In San Francisco's Chinatown souvenir shops normally bustling with visitor= s=20 were forced to shut down. Nearby irritated customers waited for a bank to= =20 reopen.=20 The blackouts like Monday's were caused by a combination of problems=20 including unseasonably warm weather reduced electricity imports from the= =20 Pacific Northwest and numerous power plants being shut down for repairs.=20 Adding to those troubles the state lost about 3100 megawatts from the QF= =20 plants.=20 Senate Energy Committee Chairwoman Debra Bowen D-Marina del Rey estimated= =20 Tuesday that Edison has amassed more than $1 billion and PG&E more than $2= =20 billion that they have not paid to generators.=20 Davis said the PUC planned to issue an order next week directing the=20 utilities to pre-pay their future QF bills.=20 PG&E said its prepayments hinge on an upcoming PUC decision on whether the= =20 utility's rates are sufficient to pay its bills and cover the state's power= =20 purchases on its behalf which amount to $4.2 billion since early January.= =20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices which the state's 1996 deregulation= =20 law prevents them from passing on to ratepayers.=20 --- Energy Overcharge of $5.5 Billion Is Alleged=20 Power: Money should be refunded to taxpayers and utilities the state grid= =20 operator says citing evidence of market manipulation. Suppliers deny the= =20 accusation.=20 By TIM REITERMAN and NANCY RIVERA BROOKS Times Staff Writers=20 ?????Wholesale electricity suppliers overcharged California by about $5.5= =20 billion between May and last month and that money should be refunded to th= e=20 state's taxpayers and financially strapped utilities the state power grid= =20 operator said Wednesday. ?????Generators engaged in market manipulation and consistent patterns of= =20 bidding far above costs in the deregulated energy market the California=20 Independent System Operator found in a study of pricing data. The findings= =20 support the widespread belief that these suppliers reaped massive additiona= l=20 revenue by manipulating the market. ?????Spokesmen for the companies denied the accusation. ?????The study prepared for a filing with federal regulators today is=20 central to Cal-ISO's efforts to seek reimbursement for what it considers=20 excessive charges by electricity suppliers during the state's energy crisis= . ?????This might be the first time we told them the total impact and=20 magnitude [of the overcharging] said Anjali Sheffrin Cal-ISO's director = of=20 market analysis. We think the entire amount deserves consideration for=20 refunds. ?????Using confidential bidding data on tens of thousands of electricity=20 sales Cal-ISO found that five companies that together supply about 30% of= =20 the power delivered to customers of the state's investor-owned utilities=20 engaged in two types of behavior that tended to push up prices: ?????* They effectively withheld supplies by bidding at excessive prices= =20 even though they could have made some money selling more electricity. ?????* Less frequently they had power generation available but did not bid= =20 at all. ?????The study concluded that energy suppliers commonly offered their=20 electricity at twice their cost. For example Sheffrin said the average=20 markup in August was 100% during peak hours. ?????A spokeswoman at the Federal Energy Regulatory Commission which=20 oversees wholesale electricity pricing across the country declined to=20 comment Wednesday saying This is part of an ongoing proceeding. ?????FERC member William L. Massey who has considered previous commission= =20 actions on refunds to be inadequate said it would be improper for him to= =20 comment on a report that has not yet been filed. But when told of the=20 $5.5-billion total Massey said: That doesn't shock me in any way. ?????Prices over the past 10 months in California have greatly exceeded th= e=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said. ?????Cal-ISO which oversees grid operations and an emergency energy market= =20 previously detailed $550 million in alleged overcharges for December and=20 January and asked FERC for refunds. But the commission has proposed refunds= =20 of only a tiny fraction of that amount. ?????The study covered five major in-state power suppliers--Reliant Energy= =20 Dynegy Williams/AES Duke Energy and Mirant formerly Southern Energy--plu= s=20 16 power importers all of which deliver power to customers of Pacific Gas = &=20 Electric Co. Southern California Edison and San Diego Gas & Electric Co. ?????All [21] overcharged but some excessively and some by moderate=20 amounts Sheffrin said. ?????Cal-ISO's public filing will quantify the alleged overcharging by each= =20 company but the companies will be identified only by a number. The code wi= ll=20 be provided to FERC Sheffrin said and Cal-ISO lawyers will determine how= =20 much information about the companies will be made public. ?????State U.S. Investigations ?????California electricity markets and the companies that buy and sell pow= er=20 in the state have been the subject of several investigations by state and= =20 federal authorities since wholesale electricity prices first skyrocketed in= =20 May. ?????Electricity suppliers have repeatedly denied manipulating the Californ= ia=20 market in any way whether through above-cost bidding in spot markets or=20 through physical withholding of electricity to drive up prices. ?????Reliant Energy is cooperating with FERC's requests for more data and i= s=20 confident the commission will conclude that prices charged by Reliant were= =20 justified said Joe Bob Perkins president of the Houston-based company. ?????Perkins also bitterly disputed charges that Reliant has shut down unit= s=20 so that it can earn bigger profits on the power sold by the remaining plant= s.=20 These charges have been leveled against all of the power-plant owners in th= e=20 state. ?????Reliant Vice President John Stout said Cal-ISO's calculations typicall= y=20 don't include such fixed costs as salaries taxes and the interest on bonds= =20 they sold to finance their power plants which they acquired under terms of= =20 the state's landmark 1996 deregulation law. ?????In addition he said many high-priced power days have resulted from= =20 buyers bidding against each other for scarce supplies rather than sellers= =20 charging excessive amounts--like a house price being driven far above the= =20 listing price in a hot real estate market. ?????Williams Energy Services a trading company that markets most of the= =20 power produced by plants owned by AES also says it will be exonerated by= =20 FERC once the commission examines documentation being submitted said Paula= =20 Hill-Collins spokeswoman for the Tulsa Okla. company. ?????FERC has the obligation to investigate when these accusations are=20 made Hill-Collins said. This is just a process of justification not=20 necessarily proof of guilt. ?????Williams/AES was recently ordered by FERC to prove that it did not tak= e=20 generating units out of service last year to drive up electricity prices o= r=20 refund $10.8 million to California utilities. ?????During the period studied suppliers sold electricity in the Californi= a=20 Power Exchange to Southern California Edison PG&E and San Diego Gas &=20 Electric Co. and in a backup market for last-minute electricity operated by= =20 Cal-ISO. But sky-high prices plunged Edison and PG&E deeply into debt and= =20 most suppliers stopped selling to them in January forcing the state=20 Department of Water Resources to step in as the primary electricity buyer f= or=20 the three big utilities' 27 million customers. ?????The Cal-ISO study first summarized at an energy conference last week = at=20 UC Berkeley but not otherwise publicized concluded that the companies=20 exercised so-called market power to pump up electricity prices. ?????Severin Borenstein director of the Energy Institute at Berkeley said= =20 Cal-ISO's study is consistent with his research examining pricing practices= =20 in 2000. ?????We found several billion dollars . . . in departures from competitive= =20 pricing he said. When the market was tight this summer they were able t= o=20 push up prices and they did. ?????The early warning signs of electricity price spikes the study found= =20 appeared in May after two years of relatively stable prices of $30 to $40 p= er=20 megawatt-hour under deregulation. Prices went up during the summer dipped = in=20 September and October with lower demand then took off in November and=20 December as weather turned cold and the price of natural gas which is used= =20 to generate much of the state's electricity reached record levels. ?????There were plant outages and demand and supply became close Sheffr= in=20 said. Whatever price they bid had to be taken and market power asserted= =20 itself. ?????Cal-ISO found that $3 billion of the alleged overcharges occurred=20 between May and November. ?????On Friday federal regulators ordered six wholesale power suppliers to= =20 refund $55 million to California if they cannot justify prices charged in= =20 February. The refund was limited to power sold that month in excess of $430= =20 per megawatt-hour during Stage 3 power alerts when supplies are so tight= =20 that rolling blackouts are threatened. (One megawatt-hour is enough=20 electricity to supply 750 typical homes for an hour.) ?????The previous week FERC ordered 13 suppliers to justify or refund $69= =20 million for power sold in January at prices above $273 per megawatt-hour. ?????Massey opposed the potential refunds as too low because they were=20 limited to hours in which a Stage 3 power emergency was in place and becaus= e=20 the benchmark price set for each month was too high--combining to exempt mo= re=20 than 70000 transactions from scrutiny. ?????We're still looking for our lost wallet under the lamppost which is= =20 Stage 3 alerts said Massey one of three commissioners on the five-member= =20 board (two seats are vacant). ?????Generators have been given the free and clear he said. ?????These tinkling little refunds they have come out with recently are=20 almost a joke said Cal-ISO board member Mike Florio senior attorney at t= he=20 Utility Reform Network. ?????Resisting Price Caps ?????Cal-ISO contends that the last 10 months have proved that generators c= an=20 no longer be allowed to receive electricity prices that are dictated by wha= t=20 the market will bear. ?????FERC granted market-based rate authority on each of these suppliers'= =20 own showing that they could not manipulate prices yet their actions have= =20 shown the contrary Sheffrin said. We feel FERC needs to look at the=20 premise of allowing these generators to continue selling at market-based=20 rates. ?????The commission is responsible for ensuring just and reasonable=20 electricity rates. Although it has called California's power market=20 dysfunctional and vulnerable to manipulation the agency has resisted setti= ng=20 firm price caps sought by California's congressional delegation. ?????Chairman Curt L. Hebert Jr. strongly opposes caps while Massey wants = to=20 use caps across the West as a temporary timeout. ?????Energy Secretary Spencer Abraham in a New York news conference=20 Wednesday reiterated his opposition to electricity price caps as a way to= =20 cope with California's energy crisis. ?????If we put price caps in place there will be more blackouts and=20 they'll be worse Abraham said. ?????Cal-ISO is filing its market study as part of its comments on FERC sta= ff=20 recommendations on ways to thwart market manipulation. FERC's proposal=20 includes strict coordination of power plant outages by Cal-ISO with reporti= ng=20 of suspicious closures to FERC and generator-by-generator bid caps tied to= =20 costs. ---=20 ?????Reiterman reported from San Francisco Rivera Brooks from Los Angeles.= =20 Times staff writer Thomas S. Mulligan in New York contributed to this story= . --- --- Power Strain Eases but Concerns Mount=20 Energy: Officials say summer prices will be high and a state report shows= =20 that contracts with generators are far short of goals.=20 By DAN MORAIN and JENIFER WARREN Times Staff Writers=20 ?????SACRAMENTO--California's fragile electricity system stabilized=20 Wednesday but a Davis administration report suggested troubles ahead becau= se=20 the state could be forced to buy most of its power for the coming summer on= =20 the costly and volatile spot market. ?????After two days of statewide blackouts power plants that had been shut= =20 down were cranked up. Unseasonable heat tapered off. The operators of the= =20 statewide power grid relaxed their state of emergency. ?????But plenty of ominous signs remained. Many small producers remained sh= ut=20 down skeptical about Gov. Gray Davis' plan for utilities to pay them. ?????State Controller Kathleen Connell issued a sharp warning about the hig= h=20 cost of the state's foray into the power business and announced that she wi= ll=20 block an administration request that she transfer $5.6 billion into an=20 account that could be tapped to pay for state purchases of electricity. ?????And a report from the administration summarizing contracts between Dav= is=20 and independent power generators showed that the state has signed contracts= =20 for only 2247 megawatts of electricity significantly less than the 6000 = to=20 7000 megawatts previously claimed. ?????While there are agreements in principle for the full amount the repor= t=20 notes that generators can back out of the contracts for a variety of reason= s=20 including the state's failure to sell bonds to finance power purchased by= =20 July 1. The Legislature has approved plans to sell $10 billion in bonds bu= t=20 none have yet been issued. ?????We are exposed enormously this summer Senate Energy Committee=20 chairwoman Debra Bowen (D-Marina del Rey) said after looking at the report.= =20 We owe the people the truth about how difficult this summer is going to be= .=20 We don't have a power fairy. ?????Perhaps most significant the report suggests that the contracts fall= =20 significantly short of Davis' stated goal of buying no more than 5% of the= =20 state's summer needs on the spot electricity market where prices can be ma= ny=20 times those of long-term contracts. ?????After reading the report Frank Wolak a Stanford University economist= =20 who studies the California electricity market said the numbers suggested= =20 that the state's long-term contracts will cover less than half of what the= =20 state will need this summer. ?????We're definitely short this summer next summer and the summer of=20 2003 he said. ?????California was forced to start buying electricity in December--at a co= st=20 of $50 million a day--because producers refused to sell to Southern=20 California Edison and Pacific Gas & Electric. The two utilities amassed=20 billions of dollars in debt when prices for wholesale power soared on the= =20 spot market. ?????Vikram Budhraja a consultant retained by Davis to negotiate deals wit= h=20 generators said the report represents a work in progress. He said the=20 state may yet sign new contracts. ?????However Wolak said the contract figures confirm what he and others ha= ve=20 been dreading: that summer is going to be rife with rolling blackouts unles= s=20 serious steps to cut demand are taken immediately. ?????Wolak and other experts say large industrial customers must be switche= d=20 to real-time meters and pricing to persuade them to use the bulk of their= =20 energy at times of low demand. ?????The head of the Energy Foundation a San Francisco-based nonprofit tha= t=20 promotes sustainable sources of power made the same proposal to Davis on= =20 Wednesday. ?????The government need not ask customers to swelter in the dark this=20 summer foundation President Hal Harvey argued in a letter. ?????He also proposed a crash campaign to boost sales of efficient applianc= es=20 and lightbulbs. He said the state needs to take over the utilities' contrac= ts=20 with alternative energy providers to ensure they stay in business and sign= =20 new contracts for 1500 megawatts of new wind power--the cheapest fastest= =20 and cleanest source of new supply. ?????Davis had proposed a formula Tuesday to force private utilities to pay= =20 the alternative producers some of which have not been paid since November.= =20 But some of them warned Wednesday that Davis' plan offers them little=20 incentive to turn on their generators. ?????Alternative energy producers supply more than a quarter of the=20 electricity consumed in California. ?????Many producers generate electricity from wind sun and geothermal=20 sources. But most of them generate power using natural gas--and the cost of= =20 natural gas has been soaring. Several natural gas users said Davis' plan= =20 which caps rates won't cover their fuel costs. ?????Davis assumes that the price of natural gas will fall. But small=20 generators say they don't have sufficient purchasing power or sophisticatio= n=20 to gamble on future prices. ?????The Public Utilities Commission is expected to approve Davis' proposal= =20 next week. It offers producers two choices: 7.9 cents a kilowatt-hour if th= ey=20 agree to supply power for five years or 6.9 cents a kilowatt-hour over 10= =20 years. ?????The price of natural gas is higher than that said Marty Quinn=20 executive vice president and chief operating officer of Ridgewood Power LLC= =20 which owns three natural gas-fired co-generation plants. If we operate=20 we'll lose money. ?????Ridgewood is not operating having been cut off by gas suppliers. The= =20 company sued PG&E last month seeking overdue payments and release from its= =20 contracts with the utility. ?????A hearing is scheduled in El Centro today in another lawsuit filed by = a=20 small energy producer an Imperial Valley geothermal producer that sued=20 Edison for refusing to let it break its contract and sell on the open marke= t.=20 CalEnergy says Edison owes it about $140 million for energy sold since=20 November. ?????A company spokesman Jay Lawrence said CalEnergy was going ahead with= =20 its suit despite Davis' proposal. We've had promises before he said. ?????In other developments: ?????* A federal judge in Sacramento on Wednesday ordered Reliant Energy of= =20 Houston a major producer to continue selling power to California during= =20 emergencies despite the company's argument that it may not be fully=20 reimbursed. The order will remain in effect for 60 days or until the U.S.= =20 Federal Energy Regulatory Commission decides a related case. ?????* Connell said the state budget surplus has shrunk to $3.2 billion=20 because the state has spent roughly $2.8 billion on electricity. She=20 criticized the administration for withholding basic information about state= =20 finances and said she will begin an audit on Monday of the Department of= =20 Water Resources which is responsible for purchasing power. ?????Davis' aides said Connell took her action because the Democratic=20 governor endorsed one of Connell's foes this week in the race for Los Angel= es=20 mayor former Assembly Speaker Antonio Villaraigosa. A Connell aide scoffed= =20 at the notion. ?????* Sen. Dianne Feinstein (D-Calif.) said she never has had a response= =20 from President Bush after writing him last month for an appointment to=20 discuss the California energy crisis. ?????In a wide-ranging lunch talk with reporters in Washington she deplore= d=20 the fact that huge huge profits are being made in the California crisis= =20 and said an appropriate federal role would be to guarantee a reliable=20 source of power until the state can get nine new generators online. ---=20 ?????Times staff writers Mitchell Landsberg in Los Angeles and Robert L.=20 Jackson in Washington contributed to this report. --- --- ------------------------ --- --- ------------------------ Net Complex A Dilemma For San Jose=20 SERVER FARM: Plant would tax grid=20 David Lazarus Chronicle Staff Writer Thursday March 22 2001=20 2001 San Francisco Chronicle=20 URL:=20 /22/M N236772.DTL=20 San Jose while trying to block construction of a new power plant is set t= o=20 approve a vast computer complex that could overwhelm California's already= =20 strained power grid.=20 City officials gave preliminary approval last week to what would be the=20 world's largest server farm. The sprawling facility to handle Internet=20 traffic would drain about 150 megawatts of power from the state electricity= =20 grid.=20 If granted final authorization on April 3 the $1.2 billion project would a= dd=20 the equivalent of about 150000 homes to California's power system which w= as=20 hit this week by rolling blackouts as demand for juice outstripped availabl= e=20 supply.=20 The server-farm issue highlights a vexing dilemma for the state.=20 On the one hand Gov. Gray Davis is calling for widespread conservation to= =20 help California overcome its current troubles. On the other no one wants t= o=20 curtail growth of the high-tech industry which is an engine for economic= =20 vitality.=20 San Jose will make a lot of money from this project said Craig Breon=20 executive director of the Santa Clara Valley Audubon Society. But to not= =20 help the state out of its energy situation there's a fair amount of=20 hypocrisy going on.=20 The server farm would be owned by U.S. DataPort a San Jose data-management= =20 firm. As planned it would occupy 10 buildings on more than 170 acres in th= e=20 city's Alviso area.=20 Total projected energy use would be 180 megawatts. About 30 megawatts would= =20 be generated by a small on-site facility and the rest would have to be=20 provided by Pacific Gas and Electric Co.=20 We're confident that the DataPort project will be approved because it's ve= ry=20 important to San Jose and to the local economy said San Jose Mayor Ron=20 Gonzales.=20 But PG&E already is saying that its power cupboard is bare. The utility do= es=20 not have sufficient existing electric infrastructure to meet U.S. DataPort= 's=20 needs it said in a recent letter to San Jose officials.=20 John Mogannam U.S. DataPort's senior vice president of operations counter= ed=20 that it could take as long as five years for the server farm to grow big=20 enough to require the full 150 megawatts from the state grid.=20 Hopefully by then the whole energy crisis will pass by and we won't have= a=20 problem he said.=20 Mogannam stressed the positive aspects of the project such as its ability = to=20 handle about 15 percent of global Internet traffic the 700 jobs it would= =20 create and the $70 million over 10 years it would generate for San Jose in= =20 property and utility taxes.=20 That's why the city likes it he said.=20 Indeed San Jose officials are so enamored with such developments that they= =20 have all but turned a deaf ear to warnings that the server farm will=20 exacerbate California's already dire power shortage.=20 Andrew Crabtree the city's senior planner said the planning commission ha= d=20 barely touched the question of energy supply when it approved the server fa= rm=20 last week.=20 It wasn't incumbent on the commission to solve the state's energy-supply= =20 problems he said.=20 Rather San Jose city planners focused on the environmental ramifications o= f=20 the proposed facility including air pollution from diesel generators and t= he=20 impact on nearby wildlife.=20 How it would affect dozens of burrowing owls in the area was a key topic of= =20 discussion.=20 We all recognized that there's a power shortage Crabtree said. But we= =20 couldn't do anything about that with this project.=20 Except to make things tougher of course.=20 Server farms run 24 hours a day seven days a week. They are an aspect of t= he=20 high-tech boom that was never foreseen by energy experts and which are now= a=20 major contributor to California's surging electricity demand.=20 A server farm essentially is a large building filled with computers. Each= =20 computer handles the Web site or Internet traffic for hundreds of corporate= =20 clients that do not have the technical resources to look after such things= =20 in- house.=20 Most server farms consume between 10 and 60 megawatts of power. At 180=20 megawatts the U.S. DataPort facility is billed as the most extensive data= =20 center on the planet.=20 There won't be another this size anywhere in the world said Mogannam th= e=20 company's senior vice president. This will be the biggest.=20 With such a vast scale however comes additional concerns. For example al= l=20 that hardware will generate huge amounts of heat requiring powerful air=20 conditioners running around the clock to keep things cool.=20 Patrick Dorinson a spokesman for the Independent System Operator which=20 oversees California's electricity network said server farms had a big=20 impact on the state's tight energy supply.=20 We have an economy that's increasingly based on delivery of information = he=20 observed. We certainly need to make sure we're building adequate generatio= n=20 and transmission to get it there.=20 As it stands no major power plants have been built in California for the= =20 past 12 years while dozens of server farms have sprung up throughout the= =20 state.=20 The Yankee Group a Boston consulting firm estimates that the amount of=20 space taken up by server farms nationwide rose to 9 million square feet fro= m=20 1999 to 2000.=20 By 2003 it expects that figure to increase to 25 million square feet or= =20 enough room for more than a hundred 10-story office buildings.=20 San Francisco may be the exception. Supervisor Sophie Maxwell proposed=20 interim zoning controls last week that would require server farms to receiv= e=20 special permission from City Hall to operate.=20 San Jose for its part has no such reservations. It does however draw th= e=20 line at big fat power plants in the backyard of the city's leading corpora= te=20 citizen.=20 Gonzales is spearheading opposition to a proposed 600-megawatt generating= =20 facility in Coyote Valley because of its proximity to a residential area at= =20 the site of a planned Cisco Systems office complex.=20 There's plenty of opportunities to generate power in the city he said.= =20 This project is just in the wrong site.=20 The matter is now in the hands of the California Energy Commission which i= s=20 expected to issue a ruling by May.=20 Cisco critics say twisted the mayor's arm to fight the plant because it d= id=20 not want a generating facility in its neighborhood. The area will be home t= o=20 thousands of well-heeled tech workers.=20 It's politics said Breon at the Audubon Society. City officials are=20 making political decisions rather than good planning decisions.=20 Ted Smith executive director of the Silicon Valley Toxics Coalition a=20 grassroots organization is calling for a moratorium on construction of all= =20 new server farms in the South Bay until sufficient power can be found to ke= ep=20 them running.=20 Until they figure out how to build these things without draining the=20 electricity grid even dryer it is they shouldn't build them he said.=20 The Internet industry is creating unintended consequences that will really= =20 screw up our future Smith added. They are so busy focusing on next=20 quarter's profits that they don't stop and think about the consequences. .= =20 .=20 SOME FAST FACTS ABOUT 'SERVER FARMS' .=20 -- What are they? Server farms are facilities dedicated exclusively to=20 housing powerful computers for Internet use.=20 -- Who uses them? Companies and individuals pay server farms to maintain=20 their Web sites handle Net traffic and store vast amounts of data --=20 functions that otherwise would require extensive hardware and technical=20 support.=20 -- Why do they use them? As Internet use explodes server farms play an=20 increasingly vital role in managing data and keeping information moving.=20 -- What's the problem? Server farms drain considerable amounts of electrici= ty=20 to keep running.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- Contracts Won't Meet Summer Demands=20 DETAILS: 2004 before full impact felt=20 Lynda Gledhill Chronicle Sacramento Bureau Thursday March 22 2001=20 2001 San Francisco Chronicle=20 URL:=20 /22/M N230640.DTL=20 Sacramento -- Long-term power contracts negotiated by the state won't cover= =20 California's entire demand for electricity until 2004 according to newly= =20 released details about the agreements.=20 The information suggests that California might have to scrounge for=20 electricity on the high-priced spot market for a couple more years even as = it=20 continues to push conservation efforts and construction of more generating= =20 plants.=20 Details of the agreements released by Gov. Gray Davis' administration show= =20 that the contracts will provide for just over a third of the state's demand= =20 for power this year. Energy secured by the contracts will grow to meet the= =20 expected demand in three years.=20 Short-term purchases of power have at least temporarily depleted the state'= s=20 budget surplus and have raised the possibility of sharp rate increases=20 sometime in the future for electricity customers.=20 Davis administration officials are banking on the hope that conservation=20 efforts and increased generating capacity will cover the shortfall along wi= th=20 purchases of electricity on the spot market.=20 We're facing an extreme challenge still this summer said Severin=20 Borenstein head of the University of California at Berkeley Energy=20 Institute. Signing contracts doesn't create more electricity.=20 The information released did not include the names of companies that the=20 state has signed contracts with or the purchase prices.=20 The sketchy details did not satisfy frustrated lawmakers who said many=20 questions remain especially how much the state will end up paying under th= e=20 terms of the contracts.=20 The fundamental question is how much is it costing the state of California= =20 to keep the lights on said Assemblyman Tony Strickland R-Thousand Oaks.= =20 What we really need is total disclosure.=20 The state started buying power in January after generators began refusing = to=20 provide electricity to the state's investor-owned utilities. Pacific Gas an= d=20 Electric Co. and Southern California Edison say they have more than $13=20 billion in past debt.=20 The state has been spending $49 million a day on power purchases since Jan.= =20 17 according to documents obtained by The Chronicle last week.=20 Those documents said the average price of the contracts across 10 years is= =20 $69 per megawatt hour including summer peak. The five-year average price i= s=20 $79 per megawatt hour.=20 According to one chart provided by the governor's office yesterday the=20 long-term contracts will fall about 35 million megawatt hours short in 2002= .=20 Based on the average price per megawatt hour the state has been paying sinc= e=20 January that could end up costing between $6.6 billion and $13 billion.=20 The law creating the state purchasing authority allowed purchases up to $10= =20 billion and extends until 2003.=20 The governor's office said 21 contracts have been signed and another 23=20 agreements that have been reached but not yet signed.=20 Several generators have said that they will not sign contracts with the sta= te=20 until the back debt by the utilities has been taken care of.=20 We have some real potential problems said Senate President Pro Tem John= =20 Burton D-San Francisco.=20 Strickland and several media outlets including The Chronicle have filed= =20 public information requests to get more information about the prices of the= =20 contracts from the administration.=20 Releasing the information would jeopardize the negotiations for future=20 contracts said Steve Maviglio Davis' spokesman.=20 Lawmakers also frustrated by the lack of information given out by the Davi= s=20 administration were not given notice that the information was coming and= =20 many said it was lost in their mail pile.=20 The cover letter was on Los Angeles Department of Water and Power letterhea= d=20 not that of the administration. The letter was written by S. David Freeman= =20 head of the Los Angeles system who was on leave for the month of February t= o=20 help the state negotiate the contracts.=20 Assemblyman George Runner R-Lancaster said the ambiguity of the=20 information raises more questions than it answers.=20 It's like watching a parade through a peephole he said. He's showing us= =20 another float but I don't know what the parade looks like.=20 Blaming the state's purchases of electricity Controller Kathleen Connell= =20 said yesterday that the state's cash on hand had fallen from $8.5 billion i= n=20 January to $3.2 billion. Connell ordered an audit of the state's power=20 buying.=20 Connell said she would block a transfer sought by the Davis administration = of=20 $5.6 billion from the general fund to the state's emergency reserve account= =20 claiming it would lead to a ''serious cash flow crisis.=20 The transfer however is not related to the energy crisis. The sum=20 represents a routine rollover of unspent money from the previous fiscal yea= r.=20 State law requires that money to be sent to a special reserve account for= =20 emergencies.=20 Davis officials acknowledged that $3.7 billion in energy purchases have had= =20 an impact on state coffers but they say the state will be repaid once bond= s=20 are issued in the coming weeks. They also said the state typically has its= =20 lowest cash reserves at this time of year. That changes in mid-April when a= =20 flood of income tax revenue pours in.=20 The transfer has nothing to do with energy purchases said Sandy Harrison= =20 a spokesman for the Department of Finance.=20 It's not helpful to ratepayers taxpayers and people who want their lights= =20 to stay on to have the issue muddied with this sort of inaccurate innuendo= =20 Harrison said.=20 In other developments yesterday:=20 -- After two days of statewide rolling blackouts power grid managers avoid= ed=20 outages. Demand was lower because of cooler temperatures around the state a= nd=20 supply increased as several power plants completed repairs.=20 -- A federal judge in Sacramento ordered a major power generator to continu= e=20 supplying power to California. Reliant Energy Services Inc. had insisted th= at=20 it should not be forced to sell to debt-heavy utilities unless the state=20 guaranteed the bills.=20 Chronicle staff writer Greg Lucas contributed to this story. / E-mail Lynda= =20 Gledhill at lgledhill@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- ----------------- California overcharged $5.5 bln for wholesale power=20 SACRAMENTO Calif. (AP) -- Electricity wholesalers overcharged California= =20 $5.5 billion over the past 10 months according to a report by managers of= =20 the state's power grid.=20 The five companies among other things frequently offered electricity at= =20 prices double what it cost them to produce concludes the California=20 Independent System Operator study which was published Thursday in the Los= =20 Angeles Times.=20 ``All overcharged but some excessively and some by moderate amounts'' sai= d=20 Anjali Sheffrin the ISO's director of market analysis.=20 The Times said the ISO planned to file the study with federal regulators=20 Thursday and are demanding that the money be paid back.=20 The companies denied the allegations adding they expect the Federal Energy= =20 Regulatory Commission will determine their prices were justified.=20 The commission has recently stepped up its scrutiny of power companies'=20 behavior during California's power crisis asking suppliers to justify $124= =20 million in sales during the first two months of the year or refund the mone= y.=20 Critics claim thousands of additional questionable sales are not being=20 challenged.=20 The ISO study alleges the wholesalers manipulated the market by bidding at= =20 excessive prices effectively withholding supplies or by not bidding at al= l=20 when they had generation capability available.=20 California has been spending about $45 million a day -- $4.2 billion since= =20 January -- to purchase power for Pacific Gas and Electric Co. and Southern= =20 California Edison. Both utilities the state's largest have been cut off b= y=20 electricity wholesalers because their credit is almost worthless.=20 State Controller Kathleen Connell said Wednesday that the state's=20 power-buying is gutting its budget surplus. Since the state started making= =20 emergency power buys the surplus has fallen from $8.5 billion to about $3.= 2=20 billion she said.=20 A federal judge issued a preliminary injunction Wednesday ordering a major= =20 electricity wholesaler Reliant Energy Services to continue selling to=20 California despite its fear that it will not be paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant stopped selling power to the ISO which buys it= =20 at the last minute on behalf of utilities to bolster supplies and try to fe= nd=20 off rolling blackouts.=20 Such blackouts hit the state twice this week. On Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts.=20 Standard & Poor's has put the state on a credit watch due to its power=20 purchases and chastised Gov. Gray Davis the Legislature and state regulato= rs=20 for not taking more aggressive steps to make sure the utilities can pay the= ir=20 bills.=20 Edison and PG&E say they are nearly $14 billion in debt due to soaring=20 wholesale power costs. The state's deregulation law blocks them from=20 recovering the costs from customers.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She said she would refuse to transfer $5.6 billion into a ``rainy day fund'= '=20 she said was set up to impress Wall Street as the state prepares to issue $= 10=20 billion in revenue bonds to cover its power buys. Transferring the money=20 would leave the state general fund $2.4 billion in debt Connell said.=20 She called the scope of the proposed transfer unprecedented and said it=20 amounted to a ``shell game'' that disguises the power purchases' effect on= =20 the state budget.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routin= e=20 and required by law. They put the state's budget surplus at $5.6 billion.= =20 ``The law says she has to do it. The law does not give her the power to=20 demand that kind of audit information'' Harrison said.=20 Harrison said the state's budget isn't in danger because it will be repaid= =20 with the revenue bonds.=20 Connell's criticism of Davis a fellow Democrat won support from Assembly= =20 Republicans and Secretary of State Bill Jones a Republican who may challen= ge=20 Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 ``Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency'' he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers. --- --- ---------------------------- If the power goes off=20 Thursday March 22 2001=20 For most of us rolling power blackouts are a nuisance. For some people it= =20 could mean life or death.=20 In Laguna Hills cancer patient Ruben Marquez said the blackout interrupte= d=20 and prolonged his dialysis treatment. He was unharmed the Register report= ed=20 on Monday's blackouts which hit about 1.2 million Californians including= =20 100000 Orange County homes and businesses.=20 What can people do to prevent disaster?=20 They and their families should have a backup plan Rebecca Long=20 spokesperson for the Orange County Red Cross told us.=20 The Red Cross recommends in general that you plan for this as you would fo= r=20 any disaster making sure you have battery-operated radios and flashlights.= =20 We do not recommend candles for an emergency because of the fire hazard.= =20 She recommended a Web site: www.prepare.org People with special health needs such as electric-powered respirators and= =20 oxygen machines also should register with the power company. There's a whole classification for such persons with health needs Southe= rn=20 California Edison spokesperson Clara Potes-Fellow told us. The list is for us to alert them that the power could be discontinued. The= y=20 arrange to have power through other means batteries or generators. We=20 recommend that they have a battery backup of eight hours. Therefore if the= =20 rotating outages are one hour they will have plenty. Even though the power company has such people's names she said we don't= =20 inform them in advance because we have just minutes from when the Independe= nt=20 System Operator which directs where the electrons go orders Edison to=20 implement a power outage on the grid Edison owns. By the time it took to= =20 call people the outage would be over. What's the problem at the ISO? We notify as best we can Pat Dorinson IS= O=20 director of communications told us.=20 The object is to keep the lights on. Sometimes it's just a moment's notice= =20 before a blackout. It makes [giving more notice] pretty difficult. We're= =20 looking into ways to make the system better.=20 In the meantime citizens will have to keep taking precautions. We can't help noting that free market pricing instead of politically-drive= n=20 prices would much more likely make electricity available albeit at higher= =20 prices.=20 We would expect too there would be hardship allowances donations and=20 level-pay plans to accommodate various types of needs. --- Socialized electricity=20 Thursday March 22 2001=20 Government control of state power won't add one watt for consumers' use TOM MCCLINTOCK Sen. McClintock R-Thousand Oaks represents the 19th state Senate District= =20 in the state Legislature.=20 In a city where bad ideas never die Sacramento is once again host to a=20 variety of plans for the government takeover of California's power system.= =20 The private sector it is said has done such a terrible job of providing= =20 electricity that government must now step in to save the day. Thus the=20 Legislature is awash in proposals to spend billions of dollars of public=20 money to acquire existing power facilities. Fifteen billion dollars has=20 already been authorized for this purpose and an additional $10 billion is= =20 pending in the Senate.=20 Meanwhile Gov. Davis is losing about a $1.5 billion a month day-trading in= =20 the electricity market. The irony is that after the expenditure of as much = as=20 $25 billion for public power'' not a single inch will have been added to= =20 the transmission lines nor a single watt to the generating capacity of=20 California. The root of California's crisis is a catastrophic shortage of electricity. = In=20 a shortage prices rise or blackouts occur. To reduce prices and avoid=20 blackouts the only permanent solution is to increase the supply. Merely=20 changing the ownership of existing facilities leaves Californians with=20 exactly the same shortage only billions of dollars the poorer for it.=20 Government takeover advocates argue that at least a government power=20 authority will protect consumers against price gouging and poor management.= =20 Unfortunately government power authorities don't insulate against price=20 gouging. The biggest price gouger in this entire crisis has been the Los=20 Angeles Department of Water and Power which was generating electricity for= =20 $51 per megawatt hour and selling it back to California ratepayers for as= =20 much as $1400.=20 Nor does a government takeover assure better management. Just a few years= =20 ago the LADWP was buried in $7 billion in debt. The Sacramento Municipal= =20 Utilities District was a managerial laughing stock having squandered=20 hundreds of millions of dollars for a nuclear plant it barely used. Say what you will'' the government takeover advocates reply when push= =20 came to shove the municipal utility districts of California are in great= =20 shape while the private utilities are a basket case.'' But one needs to lo= ok=20 at the reason. Ever since the state reorganized the electricity market in= =20 1996 the municipal utility districts were allowed to trade in a free marke= t=20 while the private utilities were forced to buy power exclusively in a=20 Soviet-style power exchange where the highest bid during an hour set all=20 prices. The municipal utilities were able to retain their generators. Government=20 forced the private utilities to sell theirs. The municipal utilities were= =20 able to enter into long-term contracts. Government prevented the private=20 utilities from doing the same thing. The municipal utilities were able to= =20 negotiate the lowest prices available for power. Government forced the=20 private utilities to pay the outlandish prices on the government's power=20 exchange. The municipal utilities were allowed to adjust their rates to=20 reflect the actual cost of power to consumers. Government forced the privat= e=20 utilities to sell at astronomical losses. The final argument is simply an ideological one: that power is just too=20 important to be left in private hands. Really? Food is a great deal more=20 important and private hands have kept this nation well fed for centuries.= =20 Picturing the Department of Motor Vehicles running the local supermarket=20 should sober even the most euphoric of the government takeover advocates. California's Independent System Operator is predicting a 6000-megawatt=20 shortfall this summer. When there is no electricity on the transmission=20 lines it really won't matter who owns them. During the hottest hours of th= e=20 hottest days of the year when as many as 6 million homes are without=20 electricity it may begin to dawn on most people that socialism doesn't wor= k=20 any better in California than it did in the Soviet Union. --- --- ------- NEWS=20 Bush's Energy Policy Will Backfire Feinstein Warns / She wants federal pri= ce=20 controls now Carolyn Lochhead 03/22/2001=20 The San Francisco Chronicle=20 FINAL=20 Page A.3=20 (Copyright 2001)=20 Sen. Dianne Feinstein D-Calif. warned yesterday that when blackouts=20 intensify in California this summer the pressure will intensify on the Bus= h=20 administration to explain why it rejected price controls on wholesale=20 electricity.=20 If by this summer California is as anticipated facing these blackouts a= nd=20 the federal government won't help I don't think the American people are=20 going to be very pleased Feinstein told California reporters.=20 Asked if help means the cost-based price controls Feinstein is pushing she= =20 said Right now yes.=20 Feinstein said California Democrats will begin to escalate their criticism = of=20 the administration predicting that support will build among Western senato= rs=20 for her legislation to impose price caps on wholesale electricity in exchan= ge=20 for lifting the rate cap on California consumers.=20 If it passes she said the administration is really going to have to face= =20 whether they're going to help or not help.=20 Feinstein said House Democrats from the West Coast also told her they expec= t=20 that White House inaction on price caps would help them gain seats in 2002.= =20 But she refused to speculate on the political fallout from the energy crisi= s=20 against Democrats in California .=20 Feinstein characterized Energy Secretary Spencer Abraham's adamant argument= s=20 against price controls as recalcitrant saying his statement to a Senate= =20 committee last week essentially said California 's on its own.=20 She speculated that because California is dominantly Democratic even=20 somebody like me that works across party lines is beginning to wonder if th= is=20 isn't an unnecessarily barbed stick at California .=20 White House spokesman Ken Lisaius disputed the charge saying the Bush=20 administration is doing all it can but can't control that demand is=20 outstripping supply.=20 The federal government cannot prevent blackouts but can only help at the= =20 margins in situations like this Lisaius said. The only thing that can=20 prevent blackouts is reduced demand increased supply and good weather.=20 Abraham has twice in the last week argued strongly against price controls= =20 including the cost-based ones Feinstein advocates saying they could increa= se=20 blackouts by discouraging power sales into the Western electricity grid.=20 He also said many power providers including the federal Bonneville Power= =20 Administration in the home district of Sen. Gordon Smith the Oregon=20 Republican co-sponsoring Feinstein's bill would be exempt from federal pri= ce=20 caps. Feinstein disputed that but Smith's office agreed.=20 Abraham argued that price controls would not work in part because roughly= =20 half the Western electricity market would be exempt including federal powe= r=20 marketing authorities such as Bonneville rural electric cooperatives and= =20 municipal utilities such as the Los Angeles Department of Water and Power.= =20 On another front House Republicans omitted from their budget projected=20 revenues from opening part of the Arctic National Wildlife Refuge to oil an= d=20 gas exploration.=20 A Budget Committee spokeswoman said Chairman Jim Nussle R-Iowa determined= =20 that the $1 billion in revenues from the wildlife refuge the Bush=20 administration included in its budget were not needed and that there was n= o=20 reason to put in something that controversial that some of our members don= 't=20 even like when you don't have to.=20 But Rep. Gary Miller R-Diamond Bar (Los Angeles County) said House=20 Republicans are not backing off at all from opening the wildlife refuge t= o=20 drilling. Our goal is to get it passed in the House he said saying the= =20 Budget Committee omitted the revenue projections because the drilling has n= ot=20 yet been approved.=20 PHOTO Caption: Sen. Dianne Feinstein wants to cap wholesale electricity=20 costs and end caps on con- sumer rates.=20 --- ------ Reliant Still In Power Pact Talks With Calif. DWR=20 By Christina Cheddar 03/22/2001=20 Dow Jones News Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 Of DOW JONES NEWSWIRES=20 =20 (This report was originally published late Wednesday.)=20 =20 NEW YORK -(Dow Jones)- Reliant Energy Inc. (REI) remains in discussions wit= h=20 the California Department of Water Resources to sign long-term power=20 contracts.=20 However issues regarding the creditworthiness of the agency remain said J= oe=20 Bob Perkins president of Reliant's Wholesale Division.=20 We want to be part of the solution Perkins said. At the same time Relia= nt=20 is trying to protect itself from incurring additional unpaid accounts=20 receivable he said.=20 The DWR has been buying power on behalf of California 's financially troubl= ed=20 utilities. However Reliant has yet to sign a formal agreement with the=20 agency because Reliant is concerned it won't be paid.=20 During a conference call Wednesday Perkins said he couldn't comment on a= =20 lawsuit between Reliant and the California Independent System Operator=20 because he didn't know how it was progressing.=20 Further court action on the case is expected Wednesday.=20 The lawsuit stems from Reliant's desire not to be required to sell power to= =20 California if the state won't guarantee payment. The Houston energy company= =20 is concerned that it won't be paid for power being bought by the ISO on=20 behalf of Edison International's (EIX) Southern California Edison unit and= =20 PG&E Corp.'s (PCG) Pacific Gas & Electric Co. unit.=20 To date Reliant is owed some $370 million from unpaid power sales to the= =20 utilities.=20 Much of Perkins' presentation centered on how the power crisis in Californi= a=20 emerged.=20 Using data from research firm Cambridge Energy Research Associates the=20 company discussed the imbalance between California 's power demand and its= =20 power supply.=20 Looking ahead to the summer it isn't a question of whether rolling blackou= ts=20 will occur but how many and how severe Perkins said.=20 Low hydroelectric availability loss of imported power warm weather deman= d=20 growth and plant outages could lead to a worst-case scenario in California = =20 he said adding that some estimates predict California could experience 11= 00=20 hours of power outages this summer.=20 The skyrocketing power prices in the region are a reflection of the power= =20 market's imbalance he said.=20 Reliant submitted only economically sound bids for power Perkins said. H= e=20 expects the company can document why it charged the prices it did as requir= ed=20 by regulators.=20 We have been very rigorous and very disciplined in what we have submitted= =20 Perkins said.=20 He added that retail customer price increases are one way of sending a sign= al=20 to consumers to lower consumption. He cited studies that show a 20% retail= =20 price increase could reduce consumption by 2000 megawatts. A megawatt is= =20 enough power to serve roughly 1000 homes.=20 -By Christina Cheddar Dow Jones Newswires 201-938-5166=20 --- ------ CPUC Must Address Rates In QF Repayment Order - SoCal Ed 03/22/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 (This article was originally published Wednesday)=20 =20 LOS ANGELES -(Dow Jones)- Any order from the California Public Utilities=20 Commission requiring utilities to pay small independent generators going= =20 forward must determine how that could be done within the existing rate=20 structure a spokesman for Edison International (EIX) utility Southern=20 California Edison said Wednesday.=20 The utility was responding to a PUC proposed decision that would require=20 utilities to pay small generators called qualifying facilities $79 a=20 megawatt hour within 15 days of electricity delivery. The decision will be= =20 voted March 27 by the CPUC.=20 We're still reviewing (the decision) and should have more to say in a day = or=20 two. To the extent that the commission orders us to pay going forward of=20 course we will. But it needs to address how we will pay the QFs a SoCal= =20 Edison spokesman said.=20 SoCal Edison and PG&E Corp. (PCG) unit Pacific Gas & Electric Co. are=20 struggling under nearly $13 billion in uncollected power costs due to an=20 inability to pass high wholesale power costs to customers under a rate=20 freeze.=20 Gov. Gray Davis Tuesday blasted the utilities for not having paid their QF= =20 bills in full since December. Pacific Gas & Electric Co. has made some=20 partial payments to QFs but SoCal Edison has paid nothing. Together they= =20 owe the QFs about $1 billion but the order doesn't address that debt.=20 An Edison executive said in reaction to the governor's sharp comments tha= t=20 the company simply doesn't have the money to pay creditors.=20 The root problem here is there just isn't enough money in the current rate= =20 base to pay our bills said Edison Senior Vice President of Public Affairs= =20 Bob Foster. We understand the financial distress (the QFs) face we are=20 facing financial distress ourselves.=20 The proposed PUC order would also require the state's investor-owned=20 utilities to offer the small generators five- and 10-year contracts for pow= er=20 for $79/MWh and $69/MWh respectively.=20 The QFs may be able to live with the PUC proposal but the five- and=20 10-year contract prices may be inadequate if natural gas prices at one of t= he=20 California borders are high said Jan Smutny-Jones president of the=20 Independent Energy Producers Association. Natural gas prices into Californi= a=20 are currently higher than anywhere in the country.=20 But some say the proposed decision may not be enough to prevent the QFs fro= m=20 filing involuntary bankruptcy proceedings against the utilities for the mon= ey=20 they are still owed.=20 There's still a lot of skepticism. To say our position has changed based o= n=20 the CPUC decision or the governor's announcement is not accurate. A lot sti= ll=20 has to happen said Jay Lawrence a spokesman for a renewable creditors=20 committee.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 --- ------ Calif Small Pwr Producers To Shut Plants If Rates Capped By Jason Leopold 03/22/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 Of DOW JONES NEWSWIRES=20 =20 (This article was originally published earlier Thursday.)=20 =20 LOS ANGELES -(Dow Jones)- Many of California 's independent power producers= =20 late Wednesday threatened to take their small power plants offline this wee= k=20 if state lawmakers pass legislation that would cap the rates the generators= =20 charge for electricity they sell directly to the state's three investor-own= ed=20 utilities.=20 At issue is a bill that would repeal a section of the state's Public=20 Utilities Code which links the 688 so-called qualifying facilities'=20 electricity rates to the monthly border price of natural gas.=20 Lawmakers however are poised to pass the legislation.=20 State regulators are then expected to approve a measure that would=20 restructure the fluctuating rates the QFs charge PG&E Corp. (PCG) unit=20 Pacific Gas & Electric Edison International (EIX) unit Southern Californi= a=20 Edison and Sempra Energy (SRE) unit San Diego Gas & Electric from $170 a= =20 megawatt-hour to $69-$79/MWh regardless of the price of natural gas.=20 Whereas each of the 688 QF contracts differed largely because natural gas= =20 prices are higher in Southern California than Northern California the sta= te=20 wants the QFs to sign a general contract with the utilities.=20 The cogeneration facilities which produce about 5400 megawatts of=20 electricity in the state said the rates are too low and they won't sign ne= w=20 supply contracts with the utilities.=20 For $79/MWh natural gas would have to be $6 per million British thermal= =20 unit at the Southern California border said Tom Lu executive director of= =20 Carson-based Watson Cogeneration Company the state's largest QF generatin= g=20 340 MW. Our current gas price at the border is $12.50.=20 Other gas-fired QFs said the state could face another round of rolling=20 blackouts if lawmakers and state regulators pass the legislation which is= =20 expected to be heard on the Senate floor Thursday and allow it to be=20 implemented by Public Utilities Commission next week.=20 Lu whose company is half-owned by BP Amoco PLC (BP) and is owed $100 milli= on=20 by SoCal Ed said the proposals by the PUC and the Legislature will only= =20 make things worse.=20 David Fogarty spokesman for Western States Petroleum Association whose=20 members supply California with more than 2000 MW said the utilities need = to=20 pay the QFs more than $1 billion for electricity that was already produced.= =20 =20 State Loses 3000 MW QF Output Due Of Financial Reasons=20 =20 The QFs represent about one-third or 9700 MW of the state's total power= =20 supply. Roughly 5400 MW are produced by natural gas-fired facilities. The= =20 rest is generated by wind solar power and biomass.=20 About 3000 MW of gas-fired and renewable QF generation is offline in=20 California because the power plant owners haven't been paid hundreds of=20 millions of dollars from cash-strapped utilities SoCal Ed and PG&E for near= ly=20 four months.=20 Several small power plant owners owed money by SoCal Ed have threatened to= =20 drag the utility into involuntary bankruptcy if the utility continues to=20 default on payments and fails to agree to supply contracts at higher rates.= =20 The defaults have left many of the renewable and gas-fired QFs unable to=20 operate their power plants because they can't afford to pay for the natural= =20 gas to run their units. Others continue to produce electricity under their= =20 contracts with the state's utilities but aren't being paid even on a forwar= d=20 basis.=20 The California Independent System Operator keeper of the state's electrici= ty=20 grid said the loss of the QF generation was the primary reason rolling=20 blackouts swept through the state Monday and Tuesday.=20 Gov. Gray Davis recognizing the potential disaster if additional QFs took= =20 their units offline held marathon meetings with key lawmakers Monday and= =20 Tuesday to try and hammer out an agreement that would get the QFs paid on a= =20 forward basis and set rates of $79/MWh and $69/MWh for five and 10 year=20 contracts. He also said he would direct the PUC to order the utilities to p= ay=20 the QFs for power they sell going forward.=20 After next week the QF problem will be behind us Davis said Tuesday. We= =20 want to get the QFs paid...the QFs are dropping like flies...and when that= =20 happens the lights go out.=20 But this just makes the problem worse said Assemblyman Dean Florez=20 D-Shafter a member of the Assembly energy committee.=20 I don't know how we are going to keep the lights on Florez said in an=20 interview. Many of these congenerators are in my district. They said if th= e=20 legislation doesn't change they are going offline. This compounds the issue= =20 of rolling blackouts especially now when we need every megawatt.=20 Davis who didn't meet with people representing the QFs said he was handin= g=20 the QF issue to the PUC because lawmakers failed to pass legislation that= =20 would have set a five-year price for natural gas and allow the QFs to sign= =20 individual contracts with the utilities. In addition SOCal Ed opposed the= =20 legislation saying the rates should be below $50/MWh.=20 Some renewable power producers said they aren't vehemently opposed to the n= ew=20 rate structure because it guarantees them a higher rate than what was=20 originally proposed.=20 =20 QFs Want Third Party Supply Contracts=20 =20 John Wood who represents the SoCal Ed Gas Fired Creditors Committee one o= f=20 a handful of groups that have formed since January to explore options on=20 getting paid by the utilities said his group of gas-fired QF creditors wan= t=20 to be released from their supply contracts and sell to third parties.=20 Under our plan we would be permitted to sell electricity to third parties= =20 (including the state Department of Water Resources) until a resolution to t= he=20 crisis can be accomplished wood said.=20 Hal Dittmer president of Sacramento-based Wellhead Electric in Sacramento= =20 which is owed $8 million by PG&E has 85 MW of gas-fired generation units= =20 offline.=20 Under the state's plan Dittmer said he risks going out of business.=20 I can't buy natural gas for what I would be paid under this decision he= =20 said. The state needs to quit kidding themselves that they don't need to= =20 raise electricity rates. All of this is being driven by an artificial=20 construct that California can avoid raising rates.=20 =20 -By Jason Leopold Dow Jones Newswires 323-658-3874=20 jason.leopold@dowjones.com=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Update Body:: Please detach the attachment combine it with the articles Gavin Dillingham sent me and attach to an e-mail to Robert Zoellick and Irwin Stelzer with this message from me: Attached is some background information on the reregulation crisis in California. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Joe Hirko farewell reception Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Issue Body:: See attached WSJ article particularly the last paragraph. The message is: there has not been enough deregulation the government is still very much in the way. California is a perfect example: the market has responded to demand increases with thousands of megawatts of new generation but state and local officials have not sited them and companies like Enron are offering price protection but utilities are not allowed to take advantage. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Purported Ken Lay Promise to Haley Barbour Body:: Ken hasn't mentioned it. I'll ask next time I talk to him. Linda Robertson 07/03/2001 01:58 PM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron cc: Pat Shortridge/Corp/Enron@Enron John Shelk/NA/Enron@Enron Subject: Purported Ken Lay Promise to Haley Barbour Pat Shortridge heard from the Executive Director of the Republican Senate Campaign Committee that Haley Barbour the new finance chair for the Committee had called Ken to request that he serve as a Finance Co-Chairman. Pat was told that Ken agreed. Have you heard of this call and did Ken agree?Thanks What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Boston Body:: Bill Thanks. I am forwarding the message to my son. Vince What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Oakland Trib Wed 3/7: Breakthrough made in rescue of PG&E Bakersfield Californian Wed 3/7: El Paso Energy closes six valley power plants Contra Costa Times Wed 3/7: Still undecided: Who'll pay DWR for electricity SF Chron Wed 3/7: State Taxpayers In Dark on Details Of Energy Deal Sac Bee Wed 3/7: Lawmakers pitch fixes for region's energy woes Orange Co. Register Wed 3/7: Power plan called wrong LA Times - Wed 3/7: Bill to Cut Some Power Prices Stalls Sac Bee Wed 3/7: PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts SF Chron Wed 3/7: PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service San Jose Mercury Wed 3/7: Power prices could soar during the summer SF Chron Wed 3/7: Power Plant Plans Cause Conflicts East county residents blast supervisors Contra Costa Times Wed 3/7: Supervisors set search for power plant sites Sac Bee Wed 3/7: Peter Schrag: California's $90 billion infrastructure gap Contra Costa Times Wed 3/7: PG&E power plan debated at hearing SF Chron Thurs. 3/8: State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August WSJ Thurs. 3/8: Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals ------------------------ Breakthrough made in rescue of PG&E State ready to pay $7 billion for lines By Steve Geissinger SACRAMENTO BUREAU SACRAMENTO -- Signaling a breakthrough in secret energy crisis talks the Davis administration disclosed Tuesday it may announce the framework of a pact to rescue the teetering Pacific Gas and Electric Co. next week. Things are going very well said Steve Maviglio a spokesman for Gov. Gray Davis. The state appears to be poised to pay at least $7 billion -- and possibly billions more -- for PG&E's high-voltage transmission lines as part of a deal to financially renovate the north-state utility according to sources familiar with the negotiations. But consumer advocates insisted that even the $7 billion price is too much to pay. And experts warned that a deal with PG&E will be more complex than with other utilities. PG&E representatives declined comment in keeping with their policy on the talks even though the Davis administration said an announcement could come as early as next week or the following week. The new timetable for an announcement was substantially sooner than in Davis' original forecast. Until late last week PG&E was still resisting the sale of its power grid despite the fact that Davis had announced the framework of an agreement with Southern California Edison. Davis expects to soon announce a similar deal with the San Diego Gas and Electric Co. However any such deal still would need federal approval. The investor-owned utilities trapped between high wholesale costs and lower regulated retail rates amassed nearly $13 billion in debts and were unable to buy electricity this winter. With the onset of rolling blackouts the state began brokering billions of dollars in emergency short- and long-term power purchases. Davis' strategy to ease the energy price and supply crisis includes bolstering both conservation and generation while fiscally refurbishing the nearly bankrupt utilities. As part of the rescue deal the utilities would have to drop legal actions seeking dramatically higher electricity bills environmentally shield wildlands they own sell power from their generators to Californians for the next decade and secure help with their debts from their parent companies. Together with the cash infusion from the sale of their power 26000-mile power grids the utilities would be allowed to sell bonds to raise funds and use customer money to pay them off. The state would upgrade the high-voltage lines and lease them back to the utilities for operation. In a reflection of the negotiations with the three utilities a Davis administration official said the deal with PG&E is proving to be more complex than with the other firms. Though PG&E finally agreed late last week to sell its transmission grid the utility apparently wants more than the $7 billion that Davis has offered according to sources. The figure is more than twice the book amount or the value placed on the system for purposes of accounting. And that's the markup that lured Edison into an agreement to sell its smaller portion of the transmission grid for $2.8 billion. But PG&E which fears an erosion of its economic base may be asking as much as $10 billion. Due to complexities in the state's 1996 deregulation of the industry PG&E is more likely to lose revenue than Edison as a result of selling its transmission lines according to experts. Big customers might be able to bypass the utility's remaining local distribution lines thereby eroding its customer base. Therefore the utility may view bankruptcy and sale of its transmission lines to the highest bidder as a potentially attractive alternative to selling its share of the grid to the state at too low a price. ---- El Paso Energy closes six valley power plants Filed: 03/07/2001 By CHIP POWER Californian staff writer e-mail: ppower@bakersfield.com El Paso Energy citing non-payment from Pacific Gas & Electric Co. said it has shut down six cogeneration plants this week. The smaller plants produced about 175 megawatts of electricity and are located primarily in the San Joaquin Valley said company spokesman Mel Scott. A megawatt can supply power to 1000 homes. At least 10 plants have closed in the past two weeks as a result of non-payment according to the state Independent System Operator which manages most of the state's electrical distribution. The El Paso Energy plants are operated with various partners and had not been compensated for December January and February deliveries said Scott. He said he did not know the total amount due but said the plants would be closed until PG&E's credit worthiness is improved. A cogeneration plant common in oil fields simultaneously produces heat energy and electrical or mechanical power from the same fuel in the same facility. Typically it produces electricity and steam which can be deployed to enhance oil recovery. Kern County is the state's leading oil-producing county. El Paso owns or has interests in more than 40000 miles of interstate and intrastate pipeline connecting the nation's principal natural gas supply regions to the five largest consuming regions in the United States namely the Gulf Coast California the Northeast the Midwest and the Southeast. El Paso closed up 99 cents on Tuesday or 1.4 percent at $71.49. The Houston-based company's stock price has ranged between $36.31 and $75.30 in the last 52 weeks. ---- Still undecided: Who'll pay DWR for electricity By Karen Gaudette ASSOCIATED PRESS SAN FRANCISCO -- The price tag is $3.2 billion and counting for electricity bought by the state Department of Water Resources for the customers of two nearly bankrupt utilities. Pacific Gas and Electric Co. Southern California Edison and the state disagree over how the DWR eventually will be reimbursed for its purchases on the expensive last-minute power market. So do the state power regulators who have the final call over who gets the money when. Under a recent law the DWR went into the electricity-buying business to help keep the two utilities from sinking further into their $13 billion debt. The state plans to retrieve the money by selling $10 billion in revenue bonds. The utilities continue to collect ratepayer dollars on that electricity which the bill's author Assemblyman Fred Keeley D-Boulder Creek says is meant to help them begin paying down their debt. In a recent letter however DWR officials requested that the state Public Utilities Commission order that a portion of that money be diverted to the state. But after the utilities subtract the costs of generating electricity payments to environmentally friendly power plants and other expenses there is no money left from ratepayer dollars to give to the DWR without sinking further into debt PG&E spokesman Ron Low said Tuesday. If it passed along money to the DWR our undercollection would grow by about $2.4 billion by the end of the year Low said. The commission unable to agree on the best course of action left the issue untouched at its last meeting but expects to revisit the issue when it meets this morning. Commissioner Richard Bilas is proposing an alternate plan that would have the DWR set its own revenue requirements that would be passed on to ratepayers. The PUC also is expected to respond to complaints from laid-off workers and customers that layoffs by utilities to cut costs have been hurting service. Commissioner Carl Wood warned at the last meeting that failure to provide safe and reliable service could mean fines for the utilities. Representatives from electrical workers unions the PUC and the utilities were to discuss the issue Tuesday afternoon. I don't think we believe that utilities can find a way out of their problems by laying off workers said Mindy Spatt a spokeswoman with the Utility Reform Network. We think consumers deserve safe and reliable service and we think they deserve it at a reasonable price. ---- State Taxpayers In Dark on Details Of Energy Deal David Lazarus Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle Few people would purchase a car simply because the dealer said ''Trust me it's a great deal.'' Yet Gov. Gray Davis essentially is telling Californians just that about dozens of long-term power contracts. Because of confidentiality agreements with power companies the governor has revealed only scant details about the state's multibillion-dollar contracts for electricity over the next 10 years. Gov. Davis has our money and we can't see how he's spending it said Doug Heller a spokesman for the Foundation for Taxpayer and Consumer Rights in Santa Monica. We've been locked out of the room. Neither Davis nor power companies would divulge specific details about the price duration or scope of individual contracts. Each cited secrecy clauses that the governor's office said had been desired by both sides. What consumers do know is this: -- California has signed 40 contracts and tentative accords valued at about $40 billion to secure enough power to light 9 million homes over the next decade. -- The average purchase price of each deal is $69 per megawatt hour -- well above the $30 to $40 charged by power generators before California's energy market went haywire last summer. -- If as is widely expected wholesale power prices fall in years ahead the state nevertheless will be locked into paying above-market rates for electricity. But it is not known which generator agreed to part with the most power at the cheapest level or the full range of the prices in concocting the $69 average. Moreover it is unclear how shrewdly the state negotiated with taxpayer money in securing power on behalf of cash-strapped utilities. These agreements are the bedrock of our long-term energy policy Davis said Monday in announcing the deals. The governor's office defended the murky nature of the contracts yesterday. It's a business transaction in which private corporate information is included said Steve Maviglio a spokesman for Davis. That's the kind of information that never gets revealed. While additional elements of the contracts will be publicized in coming months he said the contracts themselves will remain a secret. You'll never see all the details Maviglio said. This did not sit well with many observers. It's a breach of public trust said Daniel Bacon a San Francisco attorney specializing in business law. A public servant spending public money shouldn't be able to keep the spending secret. But Gary Ackerman executive director of the Western Power Trading Forum an energy-industry association in Menlo Park called confidentiality agreements a necessary evil in transactions like this. He explained that no power company would agree to a long-term contract if rival firms could learn the terms of the accord. The company would be losing too much of its competitive edge in the marketplace Ackerman said. At the same time he noted that secrecy allowed the buyer -- in this case California taxpayers -- to secure more favorable terms with individual sellers. A high price with one generator would not necessarily be sought by all power providers. Still the fact that public funds are being used makes confidentiality in this case a different matter than say Cisco Systems' quietly negotiating to take over yet another tech rival. The public is in a very awkward position said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. It has to rely on the good word and expertise of the governor and he has yet to demonstrate that he has expertise or good word in this field. Shames likened consumers to passengers in a plane being flown by a pilot without a license to fly. But what choice do we have? he asked. I don't see many other options available right now. There's the rub. No matter how bad a deal California may have cut to help meet its energy demands the alternative -- blackouts disruptions economic catastrophe -- is far far worse. On the other hand it already appears that the new contracts will not shield Californians from the threat of daily outages this summer when demand surges. Davis said only about 60 percent of the state's summertime electricity needs so far had been met. Part of the reason is that many power companies already have contracted for their output this year. Duke Energy said this was why it would not begin its nine-year contract with California until 2002 while Williams Cos. said it would only gradually increase the amount of available wattage in its 10-year contract. Both companies meanwhile will continue to profit this summer by selling into the volatile spot market where wholesale power went for as much as $1 500 per megawatt hour last year. You can't sell all your power into long-term contracts said Paula Hall- Collins a Williams spokeswoman. You save some for the spot market. Consumer groups worry that consumers will be hammered again this summer with sky-high power prices and then get nailed down the road by contracts for above-market rates. If we could look at the terms of the deals we'd see that California is being gouged for 10 years said Heller of the Foundation for Taxpayer and Consumer Rights. But the governor doesn't want us to see that. Ackerman of the Western Power Trading Forum said the state had gotten the best rates it could under current market conditions. California went for long-term contracts when everyone else moved in as well he said. Californians are paying a price for not acting sooner. ---- Lawmakers pitch fixes for region's energy woes By David Whitney Bee Washington Bureau (Published March 7 2001) WASHINGTON -- California members of Congress pleaded for everything from wholesale price caps to extending daylight-saving time an extra hour to help the region cope this summer with its persistent electricity shortage but none of the ideas seemed to catch fire at a House hearing Tuesday. People will die in California because of this crisis Rep. Brad Sherman a Los Angeles-area Republican warned the House Energy and Commerce Committee. Sherman testified that his idea for saving lives is to extend daylight-saving time by an extra hour so that there would be more daylight at the end of the day when power consumption surges. One of the peak demand periods for electricity occurs between 5 p.m. and 8 p.m. when the sun sets and people come home from work Sherman testified. If people come home and it is light out there is less of an inclination to turn a light on. Sherman said the state Legislature has called for congressional approval for states to be given authority to extend daylight-saving time and he cited analyses by the California Energy Commission and other agencies suggesting that it could cut power consumption by 1 percent to 2 percent. Sherman who was one of about a dozen California lawmakers presenting their views on the energy squeeze drew no questions from committee leaders about what his legislation might do to everything from airline schedules to television programming if West Coast states didn't agree on the same time standard. Most of the committee's questioning was on the more popular idea proposed by several California and Western lawmakers primarily Democrats to require the Federal Energy Regulatory Commission to impose caps on wholesale electricity prices that have gone wild because of a regional power shortage. Rep. Bob Filner D-San Diego charged that the price spiral has little to do with power shortages but a lot to do with a small cartel of generators bilking ratepayers. Rep. Jay Inslee D-Wash. said he brought up the idea of regional price caps with President Bush who was initially skeptical. But Inslee said that Bush warmed to the idea after being told that protections could be built into the caps so as not to discourage construction of new power plants. Upon hearing that Inslee said Bush invited him to meet with the president's Cabinet-level task force led by Vice President Dick Cheney on a national energy strategy. But Inslee said he can't get the group to meet with him. It's very disappointing Inslee said. Tuesday's hearing was part of a series the panel is holding on the California crisis so far without any emerging consensus on what if anything Congress should do. ---- Power plan called wrong Wall Street analysts say the governor's approach to the problem avoids the issue that caused the imbalance. March 7 2001 By DON THOMPSON The Associated Press SACRAMENTO California's scramble to insulate consumers from the soaring price of electricity may add to the state's power problems this summer Wall Street analysts said Tuesday. Gov. Gray Davis' emphasis on buying utilities' transmission lines and negotiating long-term power contracts to help ease their debts skirts the deep imbalance between wholesale and market rates that led to the state's power problems in the first place they said. In the long run it doesn't solve anything said Michael Worms an industry analyst for Gerard Klauer Mattison & Co. In the long run you need to send the right price signals to consumers which will create its own conservation signals. Unfortunately customers were shielded from that in California. Davis said Monday that the state's first contracts to buy electricity for two financially struggling utilities will provide only about two-thirds of the power needed on a typical summer day forcing Californians to cut power use at least 10 percent to avoid blackouts. Since early January the state has been buying one- third of the power Southern California Edison and Pacific Gas and Electric Co. customers need. The two utilities denied credit by suppliers say they have lost nearly $14 billion due to soaring wholesale electricity prices that the state's industry-deregulation law says they cannot pass on to consumers. The keepers of the state power grid had enough electricity Tuesday to avoid declaring an electricity alert but have faced an almost-daily scramble for weeks due to a tight supply and high wholesale prices. Several wholesale and retail rate proposals are circulating. Among them: Free-market advocates such as Worms want an immediate end to the deregulation-imposed retail rate freeze on Edison and PG&E that will expire next year. Davis wants a Western price cap of $100 per megawatt hour on power generators he says have been prof iteering from California's short energy supply. The Bush administration and Federal Energy Regulatory Commission are cool to that idea. In December FERC imposed a soft cap of $150 per megawatt hour on wholesale rates in the state and required suppliers to justify any higher prices they charge. Consumer groups such as The Utility Reform Network or TURN want regulated rates for residential and small-business customers but free-market rates for large industrial customers which sought deregulation in the first place. TURN also advocates a tiered rate structure with higher rates for consumers who use more than a reasonable amount of electricity each month. Assembly Republicans say electricity and natural-gas prices will fall naturally if the state increases supply mainly by making it easier to build plants and pipelines. Right now you're sort of sitting partially with regulation and part with the free market said Paul Fremont an analyst with Jefferies & Co. Both these systems work. It's sort of that in-between system that you have in Califor nia that doesn't appear to be working. The system discourages generators from building new power plants because they aren't guaranteed a profit and it doesn't do enough to discourage power use by consumers because the price they pay doesn't reflect the true cost of power Fremont said. I don't think people here have much faith in the market and why should they? countered TURN's Mindy Spatt. I think there are probably better ways of encouraging consumers to conserve than by gouging them. Davis insists the crisis can be resolved without raising rates for Edison and PG&E customers beyond the existing rate structure. In January state regulators imposed temporary rate hikes of 7 to 15 percent on Edison and PG&E customers. The Legislature and Davis extended the increases for up to a decade to help pay back the estimated $10 billion in power buying the state expects to do for Edison and PG&E over the next several years and finance its purchase of the power lines owned by the two companies and San Diego Gas & Electric. Rates were already scheduled to increase next year for Edison and PG&E customers. Under the 1996 deregulation law the pair's ratepayers saw a 10 percent rate reduction but only until early 2002. That rate cut will likely expire as planned Davis spokesman Steve Maviglio has said. Davis wants those rates to cover not only the traditional cost of generating transporting and distributing power but the added cost of paying off the two utilities' massive debt and buying their transmission lines said Assemblyman Fred Keeley D-Boulder Creek the Assembly's chief power negotiator. Yet Davis has indirectly addressed the rate imbalance by signing legislation that will let regulators raise consumer rates if necessary Keeley said. The governor and lawmakers are in effect spreading out rate increases over a decade by using long-term revenue bonds to buy power for the nearly bankrupt utilities said Severin Borenstein director of the University of California Energy Institute. At some point we have to deal with the reality that all of the power that we buy has to be paid for by somebody - it's either going to come from taxpayers or it's going to come from ratepayers Bor enstein said. Raising rates now would get us a lot of conservation. Davis also wants financial incentives for conservation and power-plant construction in time to make a difference this summer. Our mouths were agape at the rapid timetable Keeley said. Legislators are rushing to pass those incentives by month's end he said allowing three months for consumers and suppliers to act before the heat of summer. Among bills considered Tuesday the Senate Energy Committee approved legislation to accelerate the siting of power plants. It also was considering a proposal to restructure rates for generators that use renewable energy to provide about 30 percent of the state's electricity. ---- Bill to Cut Some Power Prices Stalls Energy: Democrats balk at varying payment levels for alternative generators. By DAN MORAIN JULIE TAMAKI Times Staff Writers SACRAMENTO--Legislation aimed at cutting prices for more than a fourth of the power consumed in California stalled Tuesday as Democrats questioned why a few alternative energy generators--some of them campaign donors--stood to receive higher payments than others. Lawmakers working to unravel California's energy mess have been negotiating for weeks in an effort to cut the price paid to more than 600 generators of alternative power by more than half to below 8 cents a kilowatt-hour. Those alternative generators' contracts with utilities have shot up in recent months because of a rise in the price of natural gas. The cash-strapped corporations have suspended or made partial payments to the generators over the last few months causing many to shut down or reduce their outputs. But even as the lawmakers reached agreement that pushed the average price to near the 8-cent level per kilowatt-hour some generators would have received higher prices under the bill by state Sen. Jim Battin (R-La Quinta). Some of the generators that stood to benefit had donated to Battin's campaigns. One--Windtec Inc.--gave Battin a $20000 campaign donation in 1999. Others contributed from $3000 and $5000 last year. Battin acknowledged that he has received campaign contributions from some wind power generators but said there is no connection between the donations and the bill's provisions. It is illegal it is unethical and it's not how I do business he said. Battin noted that 25% of the state's alternative energy producers are in his district. As Democrats on the Senate Energy Committee blocked the bill Battin warned that some alternative energy producers might react to the delay by trying to force Southern California Edison and Pacific Gas & Electric into bankruptcy. We will be the cause of bankruptcy Battin said. That prompted Energy Committee Chairwoman Debra Bowen (D-Marina del Rey) to retort: I'm really tired of being threatened with bankruptcy. Alternative energy producers including those that use wind solar power biomass and other means produce 27% of the energy used in California. They sell the electricity to the utilities which in turn transmit it to retail consumers. But with the utilities facing multibillion-dollar debts the alternative energy producers under contract with Edison have not been paid since November. Scores of alternative energy producers supported the measure. Edison International and the San Francisco-based consumer group the Utility Reform Network opposed it. Michael Florio of the Utility Reform group said the deal could result in higher consumer prices an Edison representative said the same thing. Battin and Assemblyman Fred Keeley (D-Boulder Creek) worked out an arrangement with many of the generators. Keeley took the lead in the early negotiations and then turned to Battin to introduce the legislation SB 47X. Rather convoluted language would have allowed higher payments to a select few generators that produce electricity from wind and biomass. Most of California's wind suppliers for instance would have received about 6 cents per kilowatt-hour. But a handful of them about half a dozen wind farms--mostly in the Palm Springs area represented by Battin--would have received 7.8 cents. Battin contends that other wind producers receive additional payments that boost them to the same level as Windtec and others that would get the higher payments. They get the same deal Battin said of the handful of generators that would benefit from the provisions he added to the bill. In California's overall energy market the amount of money that would have flowed to the favored generators is minor. But the added prices that would have been paid to the generators would have translated to at least $19 million in the next five years to be absorbed by Southern California Edison customers according to one analysis. Also Tuesday more details were disclosed about another leg of the state's effort to escape from the energy crunch--the deals with large power generators to supply electricity to California for as long as 10 years. Those arrangements were announced by Gov. Gray Davis Monday as the bedrock of California's energy policy. But some consumer advocates warned that the deals could lock the state into excessively high-priced contracts. S. David Freeman the general manager of the Los Angeles Department of Water and Power and Davis' negotiator said that the state guarded against that by varying the time spans of its deals. About 6000 megawatts are expected to be available this summer about one-third of the energy needed by the state Freeman said. The amount of power under contract swells until more than 9000 megawatts are contracted in 2004 half of the needed amount before dipping to 8000 megawatts in 2010. What we're doing here is what everybody said had to be done Freeman said. We deliberately bought 50% so we'd have a good mix between long-term contracts which may turn out to be somewhat higher or somewhat lower than the spot market and purchases on the spot market. ---- PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts By Carrie Peyton Bee Staff Writer (Published March 7 2001) Sacramento's electric utility wants out of a deal that imposes rolling blackouts locally on PG&E's command. So do a lot of other utilities. They've been writing letters lobbying lawmakers and launching informal talks with Pacific Gas and Electric Co. to get off the hook before summer. Who dodges the blackout bullet is going to play out as a political hot button around the state said George Fraser head of the Northern California Power Agency a coalition of municipal utilities. In Sacramento the next volley is expected soon with the Sacramento Municipal Utility District reportedly poised to notify PG&E that it will no longer black out homes and businesses on the larger utility's command. We are absolutely trying to fight off the requirement for rolling blackouts for the Sacramento area said Linda Davis one of seven elected members of the SMUD board of directors. Saying they don't want to be dragged down by somebody else's problems two Southern California utilities have written grid operators asking to be exempted from any blackouts caused by PG&E's or Southern California Edison's financial woes. But in PG&E's view California is in an energy crisis (and) ... we're all in this together said spokesman John Nelson. The maneuvering comes amid bleak forecasts for power supplies this summer. Although Gov. Gray Davis has said conservation new power plants and moderate weather could avert blackouts officials at the Independent System Operator which runs much of California's grid expect frequent rotating outages. One consulting firm Cambridge Energy Research Associates predicts 20 hours of rolling blackouts during July and August and about 200 hours of especially intense calls for voluntary cutbacks. Before blackouts hit the jockeying over just whose lights air conditioners and assembly lines will be shut down is growing. The outcome could affect millions of people statewide. The state Public Utilities Commission is probing rolling blackout programs run by the for-profit utilities it regulates including PG&E and Edison. A PUC analysis has suggested that PG&E's program which currently exempts about 40 percent of its customers should spread the burden more broadly. For example it said 1.9 million homes and businesses are spared just because they share a circuit with a customer deemed essential. But not-for-profit utilities such as SMUD which answer to their own elected boards or city councils have other worries. Many have already lined up their power supplies for summer. Some have raised rates or are considering raising rates. Some have taken extra conservation steps. They think those preparations ought to give them leverage to ease blackout clauses in their contracts with PG&E. SMUD general manager Jan Schori is going to use every avenue ... any avenue to put pressure on including lobbying the ISO the governor and others said utility director Davis. The Northern California Power Agency a joint-powers authority that owns and operates power plants for municipal utilities has begun informal negotiations with PG&E to change blackout rules according to Fraser its top executive. It is preparing to write PG&E asking that its members be exempted from outages altogether. Failing that it wants them to face fewer outages or to be compensated for cutting off power he said. At SMUD the utility board has met in closed session to discuss exactly what it is required to do during electric emergencies under terms of the interconnection contract that links SMUD's lines to PG&E's. The contracts are being inspected with a fine-tooth comb said SMUD director Howard Posner. Schori declined to comment on any specifics. Sources indicated that the main option being considered is notifying PG&E that because of changed circumstances SMUD believes it no longer is required to routinely comply with outage requests. Other options being explored include re-negotiating existing agreements with PG&E. Posner said that ever since two days of rolling blackouts in January constituents have been asking him 'Why are we participating when we're not the problem?' And I don't have a good answer to that. Several directors said SMUD has already spent a lot of money -- and is considering 16 percent rate increases -- to ensure that it has enough electricity under contract to meet its customers' summer demands. They believe PG&E should do the same. We're almost like a David against Goliath here said board vice president Genevieve Shiroma. The huge investor-owned utilities next door have severe problems that they need to get under control. In addition SMUD plans to argue that because it can cut usage through its Peak Corps program which remotely turns off air conditioners at volunteer households it has already done its part without rotating outages director Davis said. PG&E believes the interconnection agreements that govern smaller utilities' ties to its transmission lines have benefits and burdens to both sides said Nelson. It wouldn't be fair or good policy for just one provision to be altered without taking a look at how that affects the entire contract he said. Interconnection contracts generally have clauses that require utilities to help each other out to avert greater emergencies. Sometimes reducing demand -- called load shedding -- can be the only way to stabilize the electric grid in the seconds after a major power plant or transmission line fails. It's been around in the electrical fabric forever said Jim Pope head of Silicon Valley Power Santa Clara's city-run utility. In addition to legal requirements you have a moral obligation so you don't bring the system to collapse. Like other city-run utilities Silicon Valley Power has a contract with PG&E that requires it to shed load during an electric emergency. But its contract allows it to work with big users to reduce their demand so no one has to be completely shut off. Such agreements formed long before deregulation when PG&E ran the north state's grid now are complicated by the 1997 creation of the state Independent System Operator. The ISO today runs pieces of the grid owned by PG&E Edison and San Diego Gas & Electric Co. If it believes power use is about to surge past supply potentially triggering a grid collapse across the western United States the ISO notifies the three utilities that they have to shed a certain number of megawatts. The big utilities meet that requirement two ways. They cut circuits to some of their own customers and they tell smaller connected utilities to cut a proportionate share. In Northern California about 80 percent of the outages are borne by PG&E customers and the rest by customers of SMUD and other municipal utilities and irrigation districts. In one sense we are all in this together. If SMUD were in danger of going down we would hope others would help us out said SMUD's Posner. But that's if we're in danger from circumstances beyond our control not from mismanagement or lack of financial wherewithal. It is unclear what penalties if any a utility would face for violating an interconnection agreement. In the long run the issue would be fought either in the courts or before the Federal Energy Regulatory Commission grid officials said. As a practical matter in the seconds when the risk to the grid is greatest if one utility refused to shed load the ISO would probably solve to problem by calling on PG&E Edison or others who are willing to make deeper cutbacks they said. ---- PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service Bernadette Tansey Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle State regulators are set to decide today whether debt-ridden Pacific Gas and Electric Co. and Southern California Edison can conserve cash by laying off thousands of workers and letting service standards slip. Union officials who protested the layoffs before the California Public Utilities Commission warn that if the cuts go through neighborhoods hit by power outages could stay dark for hours and more customers could face busy signals when they call about their bills. An administrative law judge agreed advising the commission in February to order the utilities to restore 725 positions already cut and block the elimination of an additional 2125 jobs. Judge John Wong said PG&E and Edison have acknowledged the layoffs will not substantially improve their shaky financial condition which arose from skyrocketing wholesale electricity costs the utilities could not pass on to consumers under a rate cap. The savings would barely make a dent Wong said in his draft decision. The two companies together claim that their debt from power purchases amounts to more than $13 billion. PG&E says it has saved $18 million from the first wave of 325 layoffs. Wong's recommendation is already running into resistance on the PUC. Commissioner Richard Bilas said the five-member panel should not be micromanaging the utilities in a time of crisis. Bilas has proposed an alternate ruling that would allow the utilities to make the cuts but provide for PUC monitoring of service in case the commission wants to step in later. We're in a situation where the utilities are not collecting the revenues they need to operate and yet we may be guilty of not letting them cut expenses where they can cut expenses Bilas said. PG&E spokesman Jon Tremayne said savings from the layoffs are helping to keep electricity running and gas flowing. It keeps cash in our accounts so we can keep doing day-to-day business Tremayne said. In addition to the 325 positions dropped so far PG&E is proposing to cut an additional 675 during the next three to six months. The cuts affect temporary and contract workers who read meters handle new service hookups and replace equipment. PG&E has no plans to eliminate permanent positions. The company is struggling to keep up with a higher workload at its call center as customers deluge the lines with inquiries about their rising bills and the effects of deregulation. Calls to PG&E ballooned from 1.3 million in January 2000 to 2.3 million in January 2001. Bilas advocates granting PG&E's request to temporarily relax standards requiring the utility to respond swiftly to customer calls and to read customers' meters once a month. PG&E wants to read meters bimonthly and send bills based on the estimated use between readings. Discrepancies could be corrected later. Wong called those measures unacceptable. He said customers need to know immediately if their efforts to conserve power are working. Wong also said the utilities' own experts have said the workforce reductions will lengthen the time required to restore power after nonemergency equipment failure. Eric Wolfe communications director for the International Brotherhood of Electrical Workers Local 1245 said some customers have already been left without power overnight because PG&E is trying to avoid the use of overtime on nonemergency power outages. It hurts a lineman to walk away from the job leaving a customer without power Wolfe said. Tremayne said PG&E is trying to minimize overtime costs but denied the company has allowed customers to go without power out of financial concerns. He said crews were pulled out when darkness and falling trees made the work too dangerous. ---- Power prices could soar during the summer Posted at 10:35 p.m. PST Tuesday March 6 2001 BY STEVE JOHNSON Mercury News Unless Gov. Gray Davis arranges significantly more long-term electricity contracts or persuades people to turn off a lot more lights California's unpredictable spot market for power could wreak havoc this summer. Even with the 40 long-term deals announced by Davis on Monday experts interviewed Tuesday said up to 43 percent of the state's daily needs may have to come from this highly volatile market in which power is bought within a day of need. That could could prove hugely expensive because some spot market energy has cost five to six times what it would under the long-term contracts. It's widely expected that consumers ultimately would have to pay that tab which could amount to billions of dollars. And because that power won't be locked up in contracts there is no guarantee it will be available when it's needed which could lead to blackouts according to a recent report to the California Independent System Operator which oversees three-fourths of the state's power grid. ``The situation in California could reach catastrophic proportions'' the report concluded adding that unless things change dramatically ``it is a virtual certainty that peak demand will go unmet during many hot summer days.'' Steven Maviglio Davis' press secretary conceded Tuesday that the spot market could be troublesome. ``It's a major concern'' he said which is why the state is trying to line up more power contracts speed up power plant construction and promote conservation. During the normally hot month of August peak daily demand for power in the Independent System Operator's territory is expected to hit about 47700 megawatts -- enough for nearly 48 million homes. The state's three main utility firms generate about 8200 megawatts and have long-term contracts from wind solar and other energy sources for about 11700 megawatts more. That totals about 20000 megawatts. Add in the 7000 megawatts of long-term power that Davis has announced for this summer and the state is still nearly 21000 megawatts short. Costly proposition If all that power has to be obtained on the spot market the price could be high. On Friday last-minute purchases on the market averaged $411 per megawatt-hour compared to about $150 per megawatt-hour for all power obtained by the Independent System Operator and $69 per megawatt-hour on average under Davis' long-term contracts. It's possible that not all 21000 megawatts would have to be purchased on the market. Assuming Davis is successful in getting people to save 10 percent -- which could prove difficult -- conservation could reduce peak demand by nearly 5000 megawatts. California also might be able to trade for another 5000 megawatts with the federal government's Bonneville Power Administration and a hydroelectric operator in British Columbia said Arthur O'Donnell editor of California Energy Markets a trade publication. Under such deals those two outfits often send that much power to California when they don't need it and California returns the same amount or more when its demand is low. But O'Donnell said it wasn't clear whether 5000 megawatts would be available this summer because ``they still haven't gotten the snowpack they need in the Pacific Northwest'' which could limit that region's generating capacity. Still falling short Even if those hydropower imports are available and conservation works as Davis hopes it's likely California would still require the spot market for 11000 megawatts to meet the August demand. That's more than 20 percent of the state's overall power needs. ``All of the surrounding states are buying probably less than 5 percent at most of their energy on the spot market'' said Frank Wolak a Stanford economist who monitors electricity prices for the Independent System Operator. He worries about how much that power could cost and is disturbed that state officials haven't adequately addressed the issue. ``No one has any idea what they are going to do and that is part of the problem'' he said. Officials at Pacific Gas & Electric Co. are particularly concerned. They fear that their company -- which is nearing bankruptcy -- could get stuck for much of the spot market purchases by the Independent System Operator which has threatened to bill the utilities for the cost. Fearing the annual bill for that power could hit $2.4 billion this year PG&E wants the tab sent to the Department of Water Resources which also is buying power on the spot market for the state. But the Department of Water Resources has objected to that idea and the matter is expected to be heard today by the California Public Utilities Commission. ``We're looking for clarity on a number of issues'' regarding how the spot market will work ``and certainly that's one of them'' said Thomas Hannigan the water agency's director. ``I don't think anybody knows the answer of who's going to pay for it'' added PG&E spokesman John Nelson. But Nettie Hoge executive director of the Utility Reform Network in San Francisco said she suspects consumers ultimately will foot the bill. The unfortunate likelihood about spot market purchases is that ``ratepayers are responsible for all of it eventually'' Hoge said. ``It's a very big problem.'' ---- Power Plant Plans Cause Conflicts East county residents blast supervisors Jason B. Johnson Chronicle Staff Writer Wednesday March 7 2001 Industry dreams of building new power plants in east Contra Costa's hills are prompting an angry reaction among residents and elected officials who say they don't want more plants. The conflict was sparked by a vote by county supervisors yesterday to aggressively explore possible sites for new power plants throughout the county. The measure by Supervisors Mark DeSaulnier and Federal Glover which passed on a 4-to-0 vote directs the county administrator and Department of Community Development to compile a report on possible sites within 45 days. Supervisor Donna Gerber abstained after criticizing the plan for potentially repeating the same mistakes that plagued the state's energy deregulation effort by not considering how much energy the state region and county will need in future years and how much power is slated to come online. Gerber said alternative power sources such as solar should also be examined. A site drawing much attention is on top of a deposit of natural gas near the Concord Naval Weapons Station off Highway 4. The owners of 70 acres of land near the station recently formed a company Golden State Power Co. to pursue construction of at least one small peaker plant and a much larger facility capable of producing 600 megawatts. The site could hold up to three small 50-megawatt peaker plants and a larger 15-acre natural gas plant said Steve Thomas managing partner with Golden State. No land use applications have been filed. Thomas said 30 acres could be kept as open space to form a buffer around the project. Both (facilities) are state of the art said Thomas. We believe that the site is ideal. But east county residents at yesterday's meeting blasted the supervisorial measure and the power plant proposal complaining that more plants could put people's health at risk. The region already is home to six power plants. We're going to get a good dose of poor air quality and (negative) health conditions from this said Concord resident Evelyn Frietas. I think we need to stop and think about what we're doing to our quality of life. Dan Torres said the home he bought in 1995 at a new Bay Point development would be alarmingly close to the proposed Golden State site. It will be dragging emissions over our home said Torres. I didn't buy a home on that hill to be surrounded by power plants. There are six power plants in operation in east Contra Costa. Pittsburg already has two power plants and two more under construction. City Council members Frank Aiello and Yvonne Beals said the Antioch-Pittsburg area has done more than its share of energy production. Aiello said Pittsburg will soon produce enough energy to power three million homes in California. When is enough enough? asked Aiello. Pittsburg has shouldered responsibility for a land-fill and two more power plants. At some point you have to say enough. Beals said that while power plants have added millions to the city's general fund the negatives of additional plants could outweigh the benefits. I don't think that Pittsburg or east county should be the dumping ground for energy for California said Beals. ---- Supervisors set search for power plant sites The board also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord By Thomas Peele TIMES STAFF WRITER MARTINEZ -- Contra Costa County supervisors took tentative steps Tuesday toward allowing the construction of at least one small power plant before summer ordering that its staff identify potential sites in unincorporated areas within seven weeks. The board voted 4-0 to search for locations. Third District Supervisor Donna Gerber abstained saying her colleagues lacked a comprehensive context'' to identify sites. I think the board knows just enough to be dangerous'' she said. Gerber said the county should examine the potential for additional power plants within its borders but not investigate individual sites yet. But Fourth District Supervisor Mark DeSaulnier said the action was necessary because of the energy crisis and because of Gov. Gray Davis' call for local governments to help speed the construction of so-called peaker plants before July and August. I wouldn't do this except under an emergency DeSaulnier said after the vote. There are unusual circumstances. We're not talking about putting this in a residential area. Fifth District Supervisor Federal Glover backed DeSaulnier but said he hoped for a location outside his heavily industrialized East County district. There's a lot of concern in East County as to the number of plants he said. DeSaulnier said though that the only logical place for a small plant remains the industrial belt'' stretching along the waterfront from West County to Antioch. He declined to provide specifics but said the only other potential site outside the industrial areas was the Concord Naval Weapons Station property. But he quickly added that he believes the U.S. Department of Defense would never go for it. Also DeSaulnier said he could not rule out the county building the plant itself and entering the electricity-selling market during peak demand times. Board Chairwoman Gayle Uilkema called that idea extremely premature and unlikely. That's a very powerful decision. I do not think we are ready'' she said. The California Energy Commission listed the Equilon refinery in Martinez as one of 32 potential peaker plant sites in the state last week. Peaker plants kick in during peak usage times. Davis called for their quick construction before the height of summer and its energy demand for air conditioning. Plants that generate as much as 50000 megawatts don't need Energy Commission approval. DeSaulnier said he believed a peaker plant could be built about a month after final approval. Supervisors also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord. Walnut Creek commercial real estate developer Steve Thomas announced his intentions for the site north of Highway 4 last week. Construction could take two years. Eric Hasseltine a consultant representing Thomas and what he described as a brand new company for the site the Golden State Power Co. told supervisors that if they intended to speed peaker plant construction they should do what they can to expedite the larger plant. The Thomas site could house a peaker plant until the proposed larger one goes online. A large natural gas line passes under the site. DeSaulnier seemed cautious about the larger proposal which he had described last week as a good site. Uilkema too said she knew too little about it to comment. A resident who lives near the Thomas property asked the board to build it (the larger plant) closer to where you have industrial areas. You have to carefully consider the people who live nearby said Dan Torres 39. Evelyn Freitas of Concord said she lives downwind of the proposed site. Our air quality is going to be worse then it is now she said. Gerber played on the environmental issues saying the county already ranks second statewide to Los Angeles in volume of hazardous materials and amount of electrical generation. ---- Peter Schrag: California's $90 billion infrastructure gap (Published March 7 2001) By now California's surreal energy mess has grown from a crisis to a condition. It may not be quite as permanent as say death and taxes but it's still something that could get a whole lot worse before it gets better. Until there's more realistic pricing no gubernatorial pea-under-the-shell buyout scheme will solve it. Beyond the energy crisis however and in many ways similar to it California faces a whole range of other infrastructure problems -- in transportation in water resources and sewer systems in school and university buildings -- that seem once again to be all but forgotten. The Business Roundtable has estimated the need at roughly $90 billion though no number can possibly be exact. What's certain is that after a burst of high-level investment in public facilities during the 1950s and 1960s California's annual capital investment has sunk precipitously -- from an annual $150 per capita in the 1960s according to a set of recent studies for PPIC the Public Policy Institute of California to about $30 in the 1990s. But you probably don't need to tell anyone driving Bay Area or Los Angeles freeways or looking at the ubiquitous portable classrooms those dreary brown boxes that house a fourth of our public school students. Ever since passage of Proposition 13 in 1978 we have been flying the flag of deferred maintenance. As in the state's electricity crisis however there's no way California can effectively address those problems merely by building or bonding itself out of them. In highway construction in developing water resources in finding enough university space to accommodate the Tidal Wave II of students managing demand is likely to be as crucial to any solution as new construction. In the energy market -- and in electricity particularly -- it's been a familiar principle ever since David Roe of the Environmental Defense Fund first persuaded Pacific Gas and Electric that a dollar invested in conservation may be worth as much as the same investment in new generation. But in most other sectors of California's infrastructure state and local it's a lesson still to be learned. There have been scattered attempts to encourage conservation and reduce demand -- significant reduction in water use for example through the installation of low-flow faucets and low-flush toilets some reduction in traffic by using rush-hour diamond lanes or by adjusting highway or (as in New York) bridge tolls to levels of congestion. But as pointed out by David Dowall an urban economist at Berkeley state policy-makers have not really begun to consider how demand management strategies can be applied to infrastructure service areas or how the more efficient use of facilities and more realistic pricing -- highway tolls say or parking fees -- can reduce demand for scarce infrastructure resources. In any case says Dowall in one of the PPIC reports we should pick which major projects we will build not just according to per capita estimates of how much we need but according to how much consumers are willing to pay for them. To avoid hurting the poor congestion-related highway tolls and other tariffs can be rebated on the basis of income. University fees can be means-tested. In California they also could be adjusted to encourage summer school classes and other off-peak uses rather than (as in the past) making UC summer courses more expensive. Given the political and economic uncertainties there's no way to know how far such demand management can be taken. But there's not much doubt that as Dowall and others point out the state's infrastructure planning is a jumble of uncoordinated agency agendas and wish lists. The Legislature last year passed a bill AB 1473 by Assembly Speaker Robert Hertzberg that requires the governor beginning next year to submit an annual five-year infrastructure plan for state agencies and public schools along with recommendations on how to fund it. In addition Gov. Gray Davis' infrastructure commission is expected to recommend better coordination of infrastructure and land-use planning when it issues its report this spring. That would be a start. As California State Treasurer Phil Angelides has pointed out the state desperately needs to start joint planning -- regional planning -- for housing roads and other resources to reduce the need for long commutes to preserve open space and to bring jobs to where people live and housing to where the jobs are. That would itself reduce demand for more freeway lanes and equally important improve the quality of life. At present most planning for housing roads water systems and other facilities rarely recognizes the regional impact of local decisions. In the East Bay slow-growth forces push well-intended initiatives that would force more development into Tracy or Modesto and further tax the transportation systems to Silicon Valley. In city after city there are beggar-thy-neighbor efforts to grab yet another shopping mall that produces a little extra sales tax revenue for the city that gets it and that often compounds traffic and revenue problems in adjacent communities. In higher education we divide bond proceeds evenly among UC the California State University and the community colleges even though the community colleges serve eight times as many students as UC. We plan road projects according to county not regional priorities. It is all done according to antiquated political and fiscal formulas that often no longer make sense. We don't just need better capital planning we need a whole new planning system. ---- PG&E power plan debated at hearing A PUC meeting on the utility's capacity expansion project for the Tri-Valley follows weeks of protest from officials residents Power upgrade in valley debated By Megan Long TIMES STAFF WRITER SAN FRANCISCO -- Dublin officials and the developer of a Livermore subdivision faced questions Tuesday about their opposition to alternative routes of PG&E's controversial Tri-Valley power upgrade plan -- and answered by restating their long-standing objections. Tuesday's cross-examination came during the third and likely final week of the California Public Utility Commission's evidentiary hearings on the utility's $91 million Tri-Valley 2002 Capacity Increase Project. It has followed weeks of protests of PG&E's upgrade plans by officials and residents of Livermore Pleasanton Dublin and San Ramon. And before the questioning started Dublin Vice Mayor Janet Lockhart reiterated concerns about an alternative route deemed environmentally superior that would place a substation just 1000 feet north of Interstate 580 between Tassajara and Fallon roads. She said that would undermine the results of a 15-year process to plan the eastern development of the city. It's extremely important to the residents of our community to follow a plan we worked hard to produce she said. Dublin officials favor PG&E's proposed placement of the station three miles north of the freeway away from new high-tech company offices and housing developments. Besides the Dublin substation the project calls for construction of a substation in North Livermore expansion of the Pleasanton substation and installation of 23.5 miles of new lines. In response to questions from PUC Administrative Law Judge Michelle Cooke Dublin's public works director Lee Thompson confirmed that the Lin family the owner of the property where the alternative substation would go wasn't interested in selling the land to PG&E. Cooke also asked Thompson to define a discretionary permit which is how city officials said they might treat a permit for a substation. Lee said that type of permit is one the city has the right to approve or not depending on the project's impact. Eddie Peabody Dublin's community development director testified that the zoning for the Lin property accommodates uses such as commercial business research and development and light manufacturing. It would not he said be appropriate for a power substation. He said parcels within the East Dublin area that could host a station would include those zoned for public and semi-public uses including land recently bought by Oracle and Sun Microsystems for new campuses. While Dublin officials testified that one buyer of land in that area paid $86 per square foot others suggested land prices would be inflated to help make a PG&E land buy look prohibitively expensive. An executive of Centex Homes the developer of new houses near Isabel Avenue and Concannon Boulevard objected to an alternative route that would place high-voltage transmission lines overhead along Isabel and Stanley Boulevard. David Barclay president of Centex's Northern California division said that the 80-foot to 150-foot towers would have a severe visual impact on residents of the Prima tract. Ed O'Neill a lawyer for the Kottinger Ranch Homeowners Association pointed out that existing distribution lines on 50-foot poles on Isabel already mar the view for residents. The Foley family has been ranching on land south of Pleasanton city limits for years said their attorney Kennedy Richardson. The utility's project would place overhead lines and a transmission station on rolling hills that the family envisions as one day being public open space with limited development Richardson said. Lawyers for Pleasanton Livermore Kottinger Ranch and Centex are scheduled to cross-examine a PG&E engineer today about the project's routing. That testimony should be the most controversial of the hearings. Judge Cooke is expected to recommend an alignment by July to the PUC which will make the final decision. ---- NEWS State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August Marshall Wilson 03/08/2001 The San Francisco Chronicle FINAL Page A.20 (Copyright 2001) State energy officials yesterday approved plans to build a temporary electrical plant at San Francisco International Airport that should generate enough juice to power 50000 homes by August. Meeting in Sacramento the Energy Commission voted 4-0 to give the green light to the gas-fired plant. It will operate during peak summer and winter demand to help the state avoid Stage 3 power alerts and rolling blackouts. Texas-based El Paso Merchant Energy Co. won approval under a new state law mandating speedy four-month reviews of so-called peaker plants. It was the only one of seven applications statewide to win approval. The other proposals were withdrawn for various reasons. The 51-megawatt plant formally called the United Golden Gate Power Project is scheduled to be built at the northwest corner of the airport near the United Airlines maintenance center. Within the next few weeks El Paso plans to apply to build a 571- megawatt $400 million plant in the same area company spokesman Jesse Frederick said. It would undergo a separate review by state energy officials. The small peaker plant approved yesterday is to generate electricity beginning around Aug. 1 for up to three years. After the end of three years the plant would be closed or converted to a cleaner-burning system. Under state law a temporary peaker plant is permitted to spew more air pollution than a permanent plant. El Paso's temporary plant is to be built next to a co-generation plant operated by United Airlines. It would use existing connections for natural gas and water supplies and tap into existing power transmission lines. Electricity generated by the plant would be pumped into the state's electrical grid Energy Commission spokesman Gary Fay said. It would also serve as a backup for San Francisco Airport in case of a blackout. No one spoke against the proposed plant at yesterday's commission meeting. The proposal however has been criticized by area residents and environmentalists worried about air pollution. Scott Buschman a professional photographer and San Bruno resident said yesterday it was unjust that state officials 100 miles away in Sacramento approved a Texas company's proposal to put a power plant on land owned by San Francisco. The fact that they approved it without considering the public's concerns foremost air quality is very disturbing he said. Fay said the plant complies with clean-air standards. Answering the criticism about the location of yesterday's deliberation he said three hearings and several workshops were held in communities near the airport. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. ---- Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals By Wall Street Journal staff reporters Rebecca Smith Mitchel Benson and John R. Emshwiller 03/08/2001 The Wall Street Journal A1 (Copyright (c) 2001 Dow Jones & Company Inc.) SACRAMENTO Calif. -- Earlier this year Gov. Gray Davis made what may be the biggest bet in the history of the nation's biggest state: that he could tame an out-of-control electricity market and avoid devastating blackouts without busting the state's budget antagonizing its consumers or derailing his own political career. His wager is still on the table but the assumptions that underlie it are looking increasingly shaky these days. The governor has already spent around $2 billion of public money buying hugely expensive wholesale power taking over the role formerly played by the state's near-bankrupt electric utilities. And California will probably be obliged to spend billions more before its electricity market stabilizes and those utilities are restored to some semblance of financial health. Under the governor's plan California aims to recoup the money it is using to buy electricity by issuing $10 billion in bonds. That way it would still have a healthy budget surplus to finance new spending on roads schools and other public services. But there's a potentially big obstacle to this plan. The state Legislature worried about racking up billions in new debt has put limits on the size of any bond offering. In broad terms the Legislature's action would allow the state to borrow only four times as much as it can recover annually from utility customers. Right now that doesn't appear to be much. Under the current rate structure essentially set in place by California's flawed 1996 electricity-deregulation plan consumers pay far less for power than the cost of acquiring it on the wholesale market. Preliminary estimates submitted by utilities last month to the California Public Utilities Commission show the state's share of the proceeds from electricity sales this year could be as little as $241 million -- not enough to support even $1 billion in bond sales under the Legislature's formula. That would leave the state on the hook for much of the money it has already paid for power -- not to mention the billions more Gov. Davis will need to spend. That in turn raises the prospect that California's economy and its credit rating both could deteriorate significantly. But state finance officials say that based on their own projections they will be able to extract enough money to support a $10 billion bond issue. Walking a careful line between fiscal prudence and political survival Mr. Davis and others in his administration are scrambling to come up with ways to get around the legislative restrictions without raising rates for consumers. If I wanted to raise rates I could solve this problem in 20 minutes Mr. Davis says. The governor says he believes that the state can obtain enough affordable power through long-term power-supply contracts to avoid the need for a big rate increase. The billions of dollars the state hopes to borrow would be used to help pay for power until electricity prices drop as they are expected to do when new power plants come online over the next few years. The Davis administration fears that what may be its only other option -- a big increase in retail electric rates -- could prompt angry consumer groups to seek new electricity laws through a statewide ballot initiative during next year's election. That's when Mr. Davis is expected to run for a second term as governor. But trying to save California without rate increases is forcing Mr. Davis to make some colossal gambles with the state's money. State officials estimate that in the next several months California will need to spend as much as $6 billion on power purchases -- equivalent to the state's entire fiscal surplus. Mr. Davis is also looking to spend several billion more to buy the transmission assets of three investor-owned utilities in order to restore two of them to credit-worthiness. He also has announced plans to spend several hundred million dollars more on conservation programs designed to reduce demand while new power plants are being built in the state. In order to limit the state's financial exposure in the meantime the governor and his aides have in some cases ignored state law. They have threatened appointed officials who have stood in the way. And they have sharply restricted the flow of information to the public. None of those steps is expected to do much to reduce state spending on power in the coming months. In a few weeks power usage is expected to begin a sharp seasonal rise as Californians switch on their air conditioners with the coming of warmer weather. By various estimates demand during peak periods this summer could outstrip supply by 10% or several thousand megawatts. That could produce more rolling blackouts like the ones that hit Northern California earlier this year. It is also likely to put strong upward pressure on wholesale electricity prices. Steven Zimmerman managing director of Standard & Poor's Corp. says Mr. Davis and his aides don't have a lot of time to put a cap on the state's financial exposure to the crisis. The credit-rating agency has put the state on credit watch for a possible downgrade which would affect the value of all of California's outstanding public debt. Moody's Investor Service Inc. is also concerned. It said in a recent report that the power crisis could soon seriously threaten the health of the state's economy. Mr. Davis a Democrat and career politician was dealt a bad hand when he took office in 1999. The deregulation plan that sparked the state's electricity crisis was enacted under his predecessor Republican Pete Wilson. But Mr. Davis was slow to react to early signs of trouble this past summer and alarms sounded by members of the state Legislature. By the time Mr. Davis finally sprang into action earlier this year a troublesome power-supply squeeze had escalated into a crisis. In a Jan. 17 declaration of emergency the governor designated the state Department of Water Resources to take the utilities' place as the daily buyer of huge quantities of electricity. His hope: that by making the state the dominant player in California's power sector he would ease electricity producers' concerns about getting paid and give the state enough clout to negotiate lower long-term power prices. Earlier this week Mr. Davis announced final or tentative agreements with 20 power suppliers to furnish the state with a total of 8900 megawatts for periods of as long as 20 years. But the supply situation remains extremely uncertain for this summer when demand probably will top 45000 megawatts. If the state can secure enough power under contract and push down demand through aggressive conservation it might be able to squeak through the summer season. If not it will be forced to keep buying huge amounts of costly power in the cash market. Under deregulation retail electric rates were frozen for several years while wholesale-power costs were free to fluctuate. When the plan was conceived wholesale prices were low and expected to go lower. However a combination of unexpected growth in power demand and a lack of new generating capacity helped produce a supply squeeze. Average wholesale prices more than tripled last year from 1999. And in January those prices were up 10-fold from a year earlier. By then California's two biggest investor-owned utilities -- the Pacific Gas & Electric unit of PG&E Corp. and the Southern California Edison subsidiary of Edison International -- faced imminent financial collapse. They had racked up billions of dollars in wholesale power bills they couldn't afford to pay. As generators began shying away from selling to the two utilities the Clinton administration forced them to sell power into the California market an order left in place during the first weeks of the Bush administration. Still northern California was hit by rolling blackouts on several days in early January. Since then the DWR which does some electricity trading as an adjunct to its main mission of managing the state's giant system of aqueducts and reservoirs has had to learn the ins and outs of power markets on the run. It hasn't been easy. David Mills trading-floor manager for the federal Bonneville Power Administration says the water agency has at times offered to pay $50 to $100 per megawatt hour more than the available market price. They agree to prices that make you wonder says Mr. Mills whose organization markets electricity from federal dams in the Pacific Northwest. You'd at least think they'd check to see what the prevailing price is before throwing out their offer. Mr. Mills says that to cut California some slack he occasionally has instructed his traders to sell at prices lower than the DWR had offered to pay. Ray Hart the water agency deputy director responsible for the power purchasing says he isn't aware of any cases in which the DWR has overpaid. He says his team has been extremely successful by all measures. Ultimately the DWR's trading acumen is far less important than the overall arithmetic of power supply and demand in California. With the price of natural gas that feeds many of the region's generating plants at near record levels and some suppliers reluctant to sell into the troubled California market wholesale electric prices remain stubbornly high and in recent days have again been rising. The Legislature has advanced the DWR about $3 billion from the state's general fund for power purchases. Under emergency legislation passed by the Legislature and signed by Mr. Davis on Feb. 1 the general fund is to be reimbursed from a planned bond sale later this year. But under terms of the emergency law the water agency would have to wrest $2.5 billion a year in revenue from retail electricity rates in order to sell the $10 billion worth of bonds sought by Mr. Davis. Assembly Speaker Robert Hertzberg a Southern California Democrat says the formula was created to ensure that there would be a way to repay the bonds without draining the state's coffers. We didn't want to just open our wallets he says. According to the language of the Feb. 1 law the water agency gets what's left of revenue collected from ratepayers after the utilities pay certain of their own power-supply bills and other expenses. And in their filings with the PUC last month the utilities reckoned under their worst-case scenarios that there would be only $241 million available to the DWR this year. State officials are quietly pushing the PUC to rejigger the formula so that the water department gets more money -- even though that would clash with terms of the Feb. 1 law. Robert Miyashiro deputy director of the Department of Finance says the emergency law was drafted poorly and has led people to believe the DWR only gets the leftover money. He predicts there will be cleanup legislation. At the request of the Davis administration the PUC is considering a plan to use a different revenue-sharing formula than the one in the state law. The proposed new formula was written in close consultation with Mr. Davis's Finance Department says PUC President Loretta Lynch who supports the initiative and is hoping to rush it through. The effort has drawn some opposition. Commissioner Richard Bilas at a recent PUC meeting questioned the legality of the commission attempting to change a formula set by the Legislature. PG&E is even more emphatic since the DWR's extra money could come at the utility's expense. The formula threatens to undo the very financial protections for the utilities that [the new law] attempted to provide the utility said in a recent filing with the PUC. As politicians and regulators wrestle with that issue the Davis administration has taken a step to reduce the outflow of state cash that also seems to conflict with the Feb. 1 law. It was widely assumed that the law required the DWR to buy any electricity the state needed to keep its lights on. However on many occasions the DWR has refused to buy power on the grounds that it was too expensive citing a portion of the new law that urges the agency to hold down costs. The task of covering any remaining shortfall has passed to the California Independent System Operator which manages the state's energy grid and is charged with buying power when necessary to avert shortages. However the ISO doesn't have any power-purchasing money of its own and the major parties it would normally bill are PG&E and Edison whose inability to pay their power bills was the reason the state started buying electricity in the first place. Amid criticism of its stance from generators utilities and Wall Street the DWR says it has started covering more of the utilities' electricity costs. The water agency is now buying 95% to 99% of what California needs in a given day says the agency's Mr. Hart. But increased buying only adds to the uncertainty about the eventual tab. The state's legislative analyst Elizabeth Hill recently recommended that lawmakers hold off considering more than $2 billion in state spending on items ranging from college construction to beach cleanups because of continuing questions about the financial impact of the electricity crisis. Like others Ms. Hill complains that the governor's office and state agencies haven't been forthcoming with information. Indeed the DWR refuses to say precisely how much power it is purchasing and at what prices though it has on several occasions gone back to the Legislature for more money. State officials say that data on its purchasing activities would give suppliers an advantage in continuing electricity-supply contract talks. State Controller Kathleen Connell who is running for mayor of Los Angeles in an April election recently announced plans to post state power-spending information on her department's Web site. But within 24 hours Ms. Connell suspended that plan after discussions with senior Davis administration officials. I feel very strongly that this information should be publicly released says Ms. Connell. I just don't want to do anything that would weaken the state's effectiveness in negotiating. In an effort to more tightly control events the governor obtained legislative approval to abolish the 26-member ISO board which was made up of everyone from utility executives to representatives of consumer groups. He then appointed a new five-member board. To ensure a quick transition the California attorney general threatened the old board members with fines of as much as $5000 each if they didn't immediately relinquish their positions. All did. I was offended at the heavy-handed treatment says Karen Johanson a former ISO board member. One of the first acts of the ISO's new board was to close a meeting about the electricity crisis. The former ISO board routinely held such meetings in public. ISO attorneys say the meeting was largely designed as a private briefing for new board members and that the organization is committed to keeping its deliberations as open as possible. The Wall Street Journal and other news organizations have unsuccessfully challenged the closure in Sacramento state court. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Eurelectric conference Body:: Houston has experienced catastrophic flooding. My flight has been cancelled. It is conceivable that I could get out tomorrow but I am wondering if I should try. I could still make the speech if we don't get more rain but given the lack of other reasons for me to go I am considering cancelling. I don't think it makes much sense for me to go for a 15 minute speech. what do you think? phone 713.621.6550 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: A Supportive Note Body:: Dear Mr. Lay: I'm writing this note to you as a show of support to you during your dire times. The reason that I share this with you is my respect for you as a CEO a business leader and a person. My wife is one of your employees who routinely shares stories about you that are nothing less than inspiring. I know that during difficult times sometimes words emerge that can help people through difficult times. I believe that you are sincere man and know that you must be broken hearted but I hope that this article can help you lead a dispirted workforce to see things more clearly. My wife Shelly Pierce has worked for Enron for the past two years and like many of your employees has lost a great deal of her life savings. Of course I accept most of the blame for this for reasons related to this article. I lost my investment discipline and held out the false hope that Enron could not falter. After reading the article to her while I was out of town I believe that her spirit was a bit rejuvenated and she was ready to face the challenges that lay before you. Mr. Lay I appreciate the opportunity that you have given my wife and our family and hope that this story inspires you to regain your successes. From the USA Today Tuesday November 27 2001 page 15A. In recession face brutal facts thrive By Jim Collins A man in his early 20s recently asked me So what's a recession like? Its an entirely alien concept to him he'd grown up during the greatest economic boom in modern memory. His question drove home the fact that we haven't faced a severe protracted economic setback for nearly 2 decades leaving us terribly unpracticed at dealing with tough times. With this recession - long in coming perhaps long to stay - now officially upon us it is imperative that corporate leaders relearn a key lesson about how great companies (and great people) deal with difficult times differently from how they deal with merely good ones. That lesson is the Stockdale Paradox a peculiar psychology shown by those who emerge from tough times not just intact but stronger. Adm. Jim Stockdale was the highest-ranking U.S. military officer in the Hanoi prison camp during the Vietnam War. Tortured many times during his 8-year imprisonment Stockdale lived without any prisoner's rights no set release date and no certainty as to whether he would ever again see his family. He shouldered the burden of command while fighting an internal war against his captors and their attempts to use the prisoners for propaganda. At one point he beat himself with a stool and cut himself with a razor deliberately disfiguring himself so that he could not be put on video as an example of a well-treated prisoner. He exchanged secret intelligence information with his wife through their letters knowing that discovery would mean more torture and perhaps death. After his release Stockdale became the first three-star officer in the history of the Navy to wear both aviator wings and the Congressional Medal of Honor. You can understand then my anticipation at the prospect of spending part of an afternoon with Stockdale who happened to be at the Hoover Institute across the street from my office when I taught at Stanford. In preparation I read In Love and War the book he and his wife wrote to chronicle their experiences those 8 years. As I read the book I found myself getting depressed. It just seemed so bleak - the uncertainty of his fate the brutality of his captors. And then it dawned on me: Here I am sitting in my warm comfortable office looking out over the Stanford campus on a beautiful Saturday afternoon. I'm getting depressed reading this and I know that he gets out reunites with his family and becomes a national hero. If it feels depressing for me how on earth did he deal with it when he was actually there and did not know the end of the story? I never lost faith in the end of the story Stockdale said when I asked him. I never doubted not only that I would get out but also that I would prevail in the end and turn the experience into the defining event of my life that in retrospect I would not trade. I didn't say anything for many minutes and we continued the slow walk toward the faculty club Stockdale limping and arc-swinging his leg still stiff from repeated torture. Finally I asked Who didn't make it out? Oh that's easy he said. The optimists. The optimists? I don't understand I said completely confused. The optimists. Oh they were the ones who said 'We're going to be out by Christmas.' And Christmas would come and Christmas would go. Then they'd say 'We're going to be out by Easter.' And Easter would come and Easter would go. And then Thanksgiving and then it would be Christmas again. And they died of a broken heart. After another long pause he turned to me and said This is a very important lesson. You must never confuse faith that you will prevail in the end - which you can never afford to lose - with the need for discipline to confront the most brutal facts of your current reality whatever they might be. My conversation with Stockdale had a profound influence on me but I never really considered it a business lesson until my research team began to wrestle with the question of why some companies rise from difficulty to become great while others emerge from those exact same difficulties weakened and dispirited. We found that companies that became great embraced a corporate version of the Stockdale Paradox. Fannie Mae for example found itself in the 1982 recession losing $1M every business day with $56B in loans under water. Many analysts thought Fannie Mae which was getting 9% on its mortgage portfolio but paying 15% on the debt it issued was doomed. But CEO David Maxwell and his team never wavered in their aim to not merely survive but also to prevail as a great company. Yes they confronted the brutal fact that the interest-rate problem was not going to magically disappear (certainly not by Christmas). But they used this grim fact as a catalyst for creating an entirely new business model based on asking three central questions of greatness: What can we potentially do better than any other company in the world? What can best drive our economic engine? What best ignites the passions of our people? Instead of reacting to the recession with mindless restructuring Fannie Mae rebuilt itself based on its answers to these questions. Eventually it generated investor returns nearly eight times those of the general stock market. When asked how he dealt with the nay Sayers and the analysts who wrote Fannie Mae off Maxwell said that it was never an issue inside the company. Of course we had to stop doing a lot of stupid things but we never entertained the possibility that we would fail. We were going to use the calamity as an opportunity to remake Fannie Maw into a great company. The sad truth is that most executive teams won't respond that way to these dark days of uncertainty. Instead of using this recession as an opportunity to fundamentally rethink their business and rebuild a culture of discipline the will simply restructure lay off a bunch of people and liquidate their cultural equity. Mediocre leaders will hold out false hopes for a quick fix only to watch those hopes be swept away by events. Their companies will begin to die of a broken heart. It need not be this way. Those who lead with the Stockdale Paradox - those who retain the unwavering faith that they will find a way to prevail in the end but who also retain the discipline to confront the most brutal facts of reality - will find this an ideal time to rebuild and reinforce greatness. Used correctly this recession can be a defining time in your firm's history that in retrospect you would not trade. Used wrongly this recession will weaken your foundations and make it that much harder to become great. The choice is yours. Jim Collins the author of Good to Great operates a management-research laboratory in Boulder Colo. Regards Steve Steve Alexander Vice President North American Artemis Consulting Artemis International Solutions Corporation Office: +1 281.338.9616 Mobile: +1 281.830.7430 www.artemisintl.com What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Wed 6/20: Weather an early test for fee caps:=20 Any severe jump in prices will likely be curbed experts say Sac Bee Wed 6/20: State to borrow up to $5 billion to buy energy Sac Bee Wed 6/20: Dan Walters: Once burned lawmakers are very wary of Davis-Edison agreement SD Union Wed 6/20: Senate Democrats lay back to see if FERC action=20 provides rate relief=20 SD Union Wed 6/20: House panel erases Bush energy cuts LA Times Wed 6/20: Davis Regulators Face Off at Hearing LA Times Wed 6/20: Energy on Agenda but Issue Is Blame LA Times Wed 6/20: Blackout Forecasts' Dark Side LA Times Wed 6/20: FERC Move Short-Circuits for Hard Price Caps LA Times Wed 6/20: Plan Won't Raise Rates Davis Says LA Times Wed 6/20: State to Pay Electric Bill With Loan Not Taxes LA Times Wed 6/20: Edison Unveils Blackout Warning Plan LA Times Wed 6/20: State Joins Challenge to Bush on Air-Conditioner=20 Standards LA Times Wed 6/20: New Price Caps Not a Deterrent Power Firms Say LA Times Wed 6/20: The FERC's Action Is Good Bad Ugly (Commentary) SF Chron Wed 6/20: Davis OKs stopgap loan=20 CRISIS POWERS: Action sidesteps Legislature SF Chron Wed 6/20: Experts say state must seize the day=20 ANALYSIS: Price caps set stage for future SF Chron Wed 6/20: California's energy crisis hits Northwest like a tidal= =20 wave SF Chron Wed 6/20: Davis demands nearly $9 billion for electricity=20 overcharges SF Chron Wed 6/20: Fed price caps placate Demos=20 But Feinstein's bill to regulate energy producers was more strict SF Chron Wed 6/20: Potrero Hill power plant hit by 2 lawsuits=20 Neighbors city ask court to cut back hours of operation SF Chron Wed 6/20: Washington wakes up Mercury News Wed 6/20: Feinstein halts electricity price caps bill=20 Mercury News 6/20: FERC's fixes have fallen short (Commentary) OC Register Wed 6/20: Easing the crunch on costs of power (Commentary) Individual.com (Bridgenews) Wed 6/20: [B] POWER UPDATE/ US Senate panel to hold off vote on Calif. cap bill=20 Individual.com (Bridgenews) Wed 6/20: [B] FERC order seen having little= =20 effect on US generator profits Individual.com (PRnewswire) Wed 6/20: SCE Unveils Rotating Blackout Web S= ite and Public Notification Plan=20 Individual.com (AP) Wed 6/20: Edison CEO/ Ruling Hasn't Helped NY Times Wed 6/20: At Last Action on California (Editorial) NY Times Wed 6/20: Regulators' Order Could Bring Broad California Power= =20 Accord Wash. Post Wed 6/20: Davis Finds Hope in Calif. Power Crunch NY Times Wed 6/20: The Lesson of When to Give Aid to Free Markets --- Weather an early test for fee caps: Any severe jump in prices will likely b= e=20 curbed experts say. By Dale Kasler Bee Staff Writer (Published June 20 2001)=20 California electricity prices have shot back up recently potentially posin= g=20 an early test of a new federal price-control plan that takes effect today.= =20 Warm weather has sent wholesale prices doubling this week partially=20 reversing a dramatic slide that had some state officials believing they'd= =20 tamed the wildly unpredictable California electricity market.=20 The rebound in prices would be expected said Arthur O'Donnell editor of= =20 the California Energy Markets newsletter. It's 110 degrees in Phoenix and= =20 it's 100 degrees (in Sacramento) and points in between.=20 Prices this week moved back above $100 a megawatt hour about double what= =20 they were last week -- although well below the roughly $300 suppliers were= =20 charging California in mid-May. Prices showed signs of stabilizing Tuesday= =20 analysts said.=20 Experts said the Federal Energy Regulatory Commission's new price-mitigatio= n=20 plan is likely to curb the most severe price spikes. This will eliminate t= he=20 astronomical prices said Severin Borenstein director of the University o= f=20 California Energy Institute.=20 But the plan probably won't bring California a cascade of cheap power=20 either.=20 Prices likely will bump up constantly against FERC's new price caps which= =20 will fluctuate from time to time and they're not likely to go much below t= he=20 caps unless there's a significant glut of energy said Peter Stiffler of th= e=20 energy consulting firm Economic Insight Inc.=20 Traders will always trade in at the price ceiling Stiffler said. They'r= e=20 going to offer power at the highest price they can.=20 The fluctuating FERC caps are tied to the production costs of the=20 least-efficient most-expensive generating plant operating in California wh= en=20 supplies are tight and an official power alert is declared by the state's= =20 Independent System Operator which runs most of the power grid. When there= =20 isn't a power alert prices can't exceed 85 percent of the price establishe= d=20 during the most recent alert.=20 FERC said the system would begin today with a cap of $108.49 a megawatt hou= r=20 but would rise to $127.64 if a power alert is declared.=20 But the cap can fluctuate significantly. Under the old FERC plan the price= =20 cap in May was set at $267 a megawatt hour. The old plan was similar to the= =20 new system but applied only to California and only kicked in during power= =20 alerts.=20 With the caps flexible generators could have incentives to withhold power = at=20 some plants in order to raise the caps said Stanford University economist= =20 Frank Wolak.=20 The FERC plan still doesn't solve the problem of withholding said Wolak= =20 chairman of the ISO's market surveillance committee.=20 Wolak also said he's afraid FERC will let power generators exaggerate their= =20 costs in order to bump up the caps.=20 The good news is they seem to be more serious Wolak said of the=20 oft-criticized commissioners. But given how many times we've been taken in= =20 I'm wary.=20 In addition generators will be allowed to exceed the price caps if they ca= n=20 justify it to FERC officials. Borenstein said FERC in the past has allowed= =20 generators to justify just about every price level imaginable and he's=20 suspicious that the commission will let generators do the same in order to= =20 evade the new price controls.=20 State officials while cautiously optimistic about the plan were upset tha= t=20 FERC will allow a 10 percent price premium on electricity because of the ri= sk=20 of selling to the California market.=20 We recognize that the risk of nonpayment in California continues to be=20 greater than in other states the commission said in its written opinion= =20 released late Tuesday.=20 Gov. Gray Davis' spokesman Steve Maviglio called the premium ludicrous=20 because the state Department of Water Resources has been buying electricity= =20 ever since the state's troubled utilities exhausted their credit in=20 mid-January.=20 The state is as creditworthy a buyer as you can get Maviglio said.=20 Experts said the plan also won't correct the state's energy imbalance.=20 None of this is going to have much effect on blackouts Borenstein said.= =20 This is solving part of the problem I'm worried people will think=20 everything has been solved.=20 The emphasis now has to be on getting California to conserve he added.= =20 A spokesman for power generators Gary Ackerman said the price controls=20 could worsen shortages this summer and will discourage generating firms fro= m=20 investing in the new power plants the West desperately needs.=20 Builders are going to sit on the fence and think about this said Ackerma= n=20 head of the Western Power Trading Forum.=20 Acting in the face of mounting political pressure and unrelenting criticism= =20 from California FERC voted Monday to impose round-the-clock price controls= =20 throughout the 11-state Western region.=20 The FERC plan replaces a three-week-old plan that applied only to Californi= a=20 and took effect only when power reserves fell to below 7 percent of demand= =20 and an official power alert was declared.=20 By extending the plan to the entire West experts said the commission=20 probably put an end to the phenomenon known as megawatt laundering in=20 which power was shipped out of California and then re-imported. Imported=20 power wasn't subject to the old price controls.=20 The new controls said consultant Stiffler significantly narrow the abili= ty=20 of a trader to move power around and play the market.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m. State to borrow up to $5 billion to buy energy=20 By Emily Bazar Bee Capitol Bureau (Published June 20 2001)=20 State Treasurer Phil Angelides announced Tuesday that he will borrow up to = $5=20 billion to pay for future power purchases a move he said was necessary to= =20 avoid a continued drain on California's budget and cuts in other state=20 programs.=20 Since mid-January energy purchased by the state Department of Water=20 Resources on the spot market and under long-term contracts has come out of= =20 the state's general fund the source of most state spending.=20 Once the loan becomes final by the end of next week however energy will b= e=20 purchased with the proceeds.=20 Made possible by an emergency order from the governor the loan ultimately= =20 will be paid off by customers of the state's investor-owned utilities throu= gh=20 their electricity rates.=20 In essence it stops the general fund bleeding Angelides said.=20 The state has so far committed $8.2 billion from the general fund to=20 electricity purchases. Of that amount Angelides said the Department of Wat= er=20 Resources has actually spent about $6.1 billion through June 12 on power=20 purchases and has received about $900 million back from customers'=20 electricity rates.=20 Officials expect the loan to finance power purchases through September whe= n=20 they plan to issue up to $13.4 billion in revenue bonds.=20 The bonds will reimburse the general fund and and pay off the loan.=20 This gives the state some more running room some more cushion in case=20 anything goes awry with the bond sale to make sure ... the state does not r= un=20 out of general fund money jeopardizing education programs law enforcement= =20 programs children's and health services the Democratic treasurer said.= =20 Angelides said he has obtained firm commitments for $3.5 billion from JP=20 Morgan and Lehman Brothers at a blended interest rate of about 4.5 percent.= =20 If the long-term bonds are not issued by Oct. 31 the interest rate would= =20 climb to about 7 percent.=20 Lawmakers initially had hoped to close the short-term loan in May and float= =20 the long-term bonds shortly thereafter. However Republicans in the state= =20 Legislature balked at the plan forcing the delay of the bond sale until=20 mid-August.=20 Rather than wait Gov. Gray Davis invoked his emergency powers to allow for= =20 the loan and circumvent the delay.=20 Assembly Republicans don't mind that the governor used his emergency powers= =20 to expedite the loan said James Fisfis a spokesman for the caucus. Instea= d=20 he said they're concerned the loan could backfire and hurt Californians.= =20 If the larger bond offering falls through the penalties and added interes= t=20 could add up on ratepayers' bills he said.=20 But Angelides argued that the loan would benefit ratepayers on several=20 fronts: Power generators can no longer argue the state should pay a credit= =20 premium on electricity he said and for the most part will not be able to= =20 walk away from long-term energy contracts that have provisions requiring th= e=20 Department of Water Resources to obtain external financing by July 1.=20 Outside the Legislature the announcement drew praise from financial analys= ts=20 who had criticized the state for buying power with taxpayer money.=20 In late April for instance Standard & Poor cited fears over the state's= =20 mounting power costs when it downgraded California's credit rating on state= =20 bonds.=20 But S&P managing director Steven Zimmermann called the governor's executive= =20 order a step in the right direction.=20 We're very happy Zimmermann said. We were very anxious for the state to= =20 take the general fund out of the energy purchasing position it's been in.= =20 The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com= . Dan Walters: Once burned lawmakers are very wary of Davis-Edison agreement (Published June 20 2001)=20 The Capitol's politicians rarely attempt to resolve big complicated policy= =20 issues preferring to occupy their time with relatively trivial matters --= =20 which also tend to be the priorities of well-heeled and generous interest= =20 groups.=20 And when they even acknowledge a need to address something big they'll oft= en=20 just nibble at the edges rather than confront the underlying conflicts=20 squarely. That's been the pattern on water transportation population grow= th=20 and public education to name but a few of many examples.=20 The Capitol completed just one comprehensive or seemingly comprehensive b= it=20 of policymaking during the last quarter-century. But the issue on that=20 occasion was electric utility deregulation which has exploded into an ener= gy=20 crisis of monumental proportions. And that experience is having a paralyzin= g=20 effect on the Capitol's denizens.=20 Some Capitol old-timers call it 1890 disease named after the number of t= he=20 1996 bill that created California's fatally flawed system of pricing electr= ic=20 power. The legislation was written largely by lobbyists for affected intere= st=20 groups and then presented to the full Legislature for take-it-or-leave-it= =20 approval. The measure was passed without a single dissenting vote even=20 though only a few lawmakers even began to understand its ramifications.=20 It was a huge failure of the legislative process virtually a dereliction o= f=20 duty and those who participated have been doing some fancy explaining. But= =20 given the history both veteran legislators and those who came to the Capit= ol=20 after 1996 are very leery about putting their names on additional pieces of= =20 energy policy that could backfire if the real-world outcome is markedly=20 different from the purported effects.=20 One example is the $43 billion in long-term energy supply contracts=20 negotiated by Gov. Gray Davis' administration to end the state's dependence= =20 on volatile spot market prices. When the long-term contracting program was= =20 authorized by the Legislature early this year it was on the assurances of= =20 the administration that it could obtain large quantities of power at cheap= =20 prices. But by the time that the contracts were made final months later t= he=20 average price was 25 percent higher than what was stated earlier while the= =20 spot market had fallen dramatically. Now the long-term contracts that seeme= d=20 like such a good idea in January and February could become financial=20 albatrosses.=20 An even more telling example is the deal Davis made with Southern Californi= a=20 Edison to keep the utility from joining Pacific Gas and Electric in=20 bankruptcy. The utilities accumulated at least $13 billion in debts in six= =20 months buying power at prices much higher than they were allowed to=20 recapture from their customers. Consumer groups are denouncing the Edison= =20 deal as a corporate bailout that would impose multibillion-dollar burdens o= n=20 customers while imposing virtually no financial onus on Edison or its=20 creditors. And the deal's critics are pouncing on legislators' reluctance t= o=20 do something that might haunt them later -- especially in 2002 a critical= =20 election year.=20 Five years ago lawmakers and the utilities foolishly foisted this=20 deregulation scheme onto California consumers and now the governor and=20 Edison expect the ratepayers to pay billions more to save the utilities fro= m=20 their own mismanagement and bad policy decisions consumer gadfly Harvey= =20 Rosenfield said Tuesday as legislative hearings opened on the Edison deal.= =20 This time the whole world is watching the Legislature.=20 Harry Snyder of Consumers Union echoed Rosenfield's pledge to hold=20 legislators accountable. It looks a lot like 1890 Snyder said. It's too= =20 big (and) this is the same process all over again.=20 The sheer complexity and potential ramifications of the deal are weighing= =20 heavily on lawmakers. This is not a Mother's Day resolution Senate Energ= y=20 Committee Chairwoman Debra Bowen said wryly as the hearings began. Davis an= d=20 Edison lobbyists are pulling out all the stops but legislators are very= =20 very nervous about taking another big step that could generate public=20 backlash.=20 The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.c= om . Senate Democrats lay back to see if FERC action provides rate relief=20 By Finlay Lewis COPLEY NEWS SERVICE=20 June 19 2001=20 WASHINGTON =01) Key Senate Democrats called a truce Tuesday in the politica= l=20 wars raging over California's energy crisis as they adopted a wait-and-see= =20 posture over the Federal Energy Regulatory Commission's latest order=20 restricting electricity prices across much of the West.=20 Senators of both parties expressed relief over FERC's action on Monday. But= =20 Sen. Dianne Feinstein D-Calif. said she was skeptical that the order woul= d=20 end wholesale price manipulation by power providers or result in refunds to= =20 overcharged ratepayers.=20 Feinstein and Sen. Gordon Smith R-Ore. have prepared legislation seeking = a=20 much tighter pricing formula than the one FERC used. But she asked that the= ir=20 bill be set aside temporarily in deference to the agency's action.=20 I think we should wait and see what happens Feinstein said during a Sena= te=20 Energy and Natural Resources Committee hearing on the FERC order.=20 Democrats on the committee pressed FERC Chairman Curtis L. Hebert and the= =20 four other commissioners on why they had not acted sooner to control the=20 daily price turbulence in the California energy market. A market-interventi= on=20 order issued by FERC in April was designed to cope only with energy-supply= =20 emergencies despite pleas by California Gov. Gray Davis and other Californ= ia=20 Democrats for more drastic measures.=20 It's time to stop blaming and start problem-solving said Hebert a=20 Republican appointed chairman by President Bush.=20 Hebert noted that electricity prices on the volatile spot market have dropp= ed=20 considerably since the April order. Prices on the energy futures market hav= e=20 also tumbled as have natural gas prices =01) a key component in the cost o= f=20 electricity.=20 On Monday FERC unanimously ordered around-the-clock restraints on wholesal= e=20 electricity prices in California and 10 neighboring states over the next 15= =20 months.=20 As was the case with the April measure prices will be pegged to the costs = of=20 the least efficient power provider when reserves in California fall below 7= =20 percent. But when reserves are more plentiful the prices will drop to 85= =20 percent of the level established during supply shortages.=20 The order also provides for a 22-day period involving arbitration and revi= ew=20 by an administrative law judge for resolving price-gouging allegations and= =20 providing refunds in cases of improper pricing.=20 Adamantly opposing price controls earlier FERC acted after coming under=20 intense pressure from lawmakers of both parties. Republicans said they were= =20 worried that their GOP colleagues in California would have been blamed and= =20 possibly imperiled at the polls if FERC had failed to act.=20 Bush who also took a hard line against price caps blessed FERC's action= =20 after it was taken.=20 Hebert criticized the bill advanced by Feinstein and Smith as an attempt to= =20 solve California's problem by bureaucratic fiat.=20 Their measure would calculate wholesale electricity prices based on the=20 reported production costs of the individual generators with an added=20 allowance for a profit margin.=20 Hebert argued that the mitigation price that FERC will establish is not = a=20 blunt arbitrary figure that bears no resemblance to market conditions and = is=20 subject to political pressures and whims.=20 Meanwhile Commissioner William Massey made it clear that he harbors=20 misgivings about the FERC measure although he supported it.=20 He said the agency should have acted earlier to avoid the subsequent=20 carnage in California has failed to provide guidelines that would assure= =20 refunds to overcharged consumers and has acted questionably in allowing pow= er=20 providers to impose a 10-percent surcharge to cover credit-worthiness risks= .=20 Massey a Democrat who has consistently criticized his colleagues for movin= g=20 too slowing in the California crisis also said he wondered whether the ord= er=20 would provide an unintended incentive for generators to continue using=20 inefficient units in order to assure higher profit margins for their more= =20 modern facilities.=20 Sen. Barbara Boxer D-Calif. said she would propose legislation later this= =20 week designed to assure refunds to customers who have had to pay unfair=20 prices for their electricity.=20 If FERC won't do it ... Congress should Boxer said.=20 A spokesman for Sen. Jeff Bingaman D-N.M. chairman of the committee said= =20 Bingaman agreed with Feinstein on the need for a time-out while the FERC=20 order is being implemented.=20 Gov. Davis will testify today (6/20) before the Senate Government Affairs= =20 Committee which is investigating FERC's role in the crisis. Hebert and the= =20 other commissioners will also appear.=20 House panel erases Bush energy cuts=20 By Alan Fram ASSOCIATED PRESS=20 June 19 2001=20 WASHINGTON =01) A House subcommittee voted Tuesday to spend $1.2 billion mo= re=20 next year than President Bush proposed for energy and water programs=20 underlining lawmakers' sensitivity to the West's power problems and their= =20 desire for home-district projects.=20 The $23.7 billion measure approved by voice vote by a panel of the House= =20 Appropriations Committee is normally one of the more routine of the 13=20 annual spending measures Congress must approve. But with this year's=20 escalating battle between Bush and Democrats over energy policy the=20 measure's profile has been raised.=20 The bill would provide $18.7 billion for the Energy Department $641 millio= n=20 more than Bush requested and $444 million more than this year. Fiscal 2002= =20 which the bill covers begins Oct. 1.=20 It also includes nearly $4.5 billion for the Army Corps of Engineers and th= e=20 hundreds of water projects it has under way across the country $568 millio= n=20 more than Bush proposed but $73 million less than this year.=20 The measure was approved shortly after top members of the committee met wit= h=20 Bush at the White House.=20 Participants said Bush and the lawmakers reaffirmed their goal of keeping t= he=20 price tag of the 13 bills to $661 billion which is one-third of the overal= l=20 federal budget. That would be a 4 percent boost over 2001 which many=20 Democrats =01) and some Republicans in private =01) say is too low.=20 He said there would be attempts to raise this as we go through the process= =20 and let's stick with him said Rep. Sonny Callahan R-Ala. chairman of th= e=20 energy and water subcommittee.=20 Illustrating the pressures Republicans face David Sirota spokesman for th= e=20 Democrats on the committee said the bill lacked the new spending needed fo= r=20 renewable energy and other programs that could help alleviate power=20 shortages.=20 Under the bill approved Tuesday renewable energy programs would get $377= =20 million $100 million more than Bush wanted and $1 million more than this= =20 year. Nuclear energy basic energy sciences biological and environmental= =20 research and a study of whether spent nuclear fuel should be stored at a=20 Nevada site would all get about what Bush proposed.=20 The bill's $7.03 billion for environmental cleanups is $699 million more th= an=20 Bush proposed. Programs aimed at containing the nuclear arsenals of former= =20 Soviet states would get $845 million $71 million more than Bush's plan.=20 Members voted to hold the brief meeting behind closed doors after citing th= e=20 national security sensitivity of publicly discussing some of the nuclear=20 weapons programs covered by the bill.=20 Davis Regulators Face Off at Hearing From Reuters=20 ?????WASHINGTON -- California Governor Gray Davis a Democrat today blamed= a=20 Republican-led energy regulatory agency for not doing enough to help his=20 energy-starved state and demanded refunds of $6.7 billion for alleged=20 price-gouging by power generators. ?????Davis whose political future has been linked to his state's electrici= ty=20 woes was testifying at a Senate hearing with members of the Federal Energy= =20 Regulatory Commission. ?????The hearing marked the first time that Davis met face to face with all= =20 five FERC commissioners. ?????FERC regulates interstate electricity markets and has jurisdiction to= =20 order refunds by power generators found to have overcharged utilities. ?????Earlier this week the agency led by a Republican majority rejected= =20 Davis' pleas for strict caps on prices that soared above $400 per megawatt= =20 hour last month. ?????Sen. Joseph Lieberman the former Democratic vice presidential nominee= =20 heads the Senate Governmental Affairs Committee that quizzed the FERC=20 commissioners and Davis on efforts to stabilize the chaotic Western=20 electricity market. ?????Davis accused FERC of failing to act aggressively against alleged=20 price-gouging by out-of-state generators. ?????To date not a single penny in refunds has been returned to=20 Californians Davis said. It is unconscionable for the generators to prof= it=20 from their egregious overcharges. FERC must move quickly to enforce the law= =20 and order the energy companies to give back the money. ?????Davis said the state is owed refunds of at least $6.7 billion.=20 California's grid operator has estimated that from May 2000 to May 2001=20 power generators charged the state nearly $9 billion more than a competitiv= e=20 market would warrant he said. ?????California the nation's most populous state has been hit with a seri= es=20 of rolling blackouts the bankruptcy of its largest utility and an economi= c=20 slowdown since the power crisis began last year. ?????The state is expected to convene a criminal grand jury to investigate= =20 whether some power generators withheld supplies shut down plants or=20 exploited the bidding process to drive up prices. Out-of-state generators= =20 deny any illegal activity saying the high prices simply reflect supply=20 shortages. ?????Today also marks the day that FERC's newly expanded price mitigation= =20 program goes into effect in all 11 Western states with a wholesale price=20 limit of $107.9 per megawatt hour linked to a market formula. The plan had= =20 previously applied only to California during emergency power outages. ?????Since FERC's action earlier this week Senate Democrats dropped a=20 legislative effort to strictly cap electricity prices in the West. However= =20 California Democrats in the House were still trying to force a full vote on= a=20 package of energy amendments including a price cap. ?????The Bush administration and many Republicans oppose price caps=20 contending they would discourage more power production. ?????Separately today the U.S. Energy Department issued a study that=20 supported the White House's view that strict price caps would hurt not hel= p=20 California. ?????The study found California faces about 113 hours of rolling blackouts= =20 this summer a level that would double if wholesale prices were capped at= =20 $150 per megawatt because some 3600 megawatts of generating capacity would= =20 shut down. An alternative approach of setting a price cap based on producti= on=20 costs plus $25 per megawatt would delay or close about 1300 megawatts of= =20 capacity scheduled to be built in the state according to the study. ?????However lawmakers from both political parties have scrambled for some= =20 kind of solution to address the shortages in California well before the=20 congressional elections next year. ?????The FERC plan expands an existing price mitigation program in=20 California to 10 other Western states. The plan which runs through Septemb= er=20 2002 means that during nonemergency periods the price for wholesale power= =20 cannot exceed 85 percent of the cost of electricity sold during a Stage 1= =20 power shortage emergency in California. ?????A Stage 1 emergency is declared when electricity supplies fall below 7= =20 percent of demand on the Western power grid. ?????The plan also imposes a 10 percent surcharge on all power sales into= =20 California as financial protection for generators reluctant to sell to the= =20 state's financially weak utilities. ?????Davis was due to meet the two newest FERC commissioners Patrick Wood = of=20 Texas and Nora Brownell of Pennsylvania today. Both are former utilities= =20 regulators in states that successfully deregulated their power industry and= =20 nominated to the agency by President Bush. Copyright 2001 Los Angeles Times=20 NEWS ANALYSIS Energy on Agenda but Issue Is Blame=20 Politics: Gov. Davis will try to sway voter anger toward the GOP as he face= s=20 a Senate panel.=20 By RONALD BROWNSTEIN Times Political Writer=20 ?????WASHINGTON--When California Gov. Gray Davis testifies at a high-profil= e=20 Senate hearing today the issue formally on the table will be the expanded= =20 electricity price controls that federal regulators approved this week. But= =20 the session's political subtext will be the escalating struggle between Dav= is=20 and national Republicans to determine where California voters look for=20 solutions--and blame--for the state's power woes. ?????In both California and Washington Republican strategists believe Davi= s=20 is trying to manufacture a succession of conflicts with the White House tha= t=20 will allow him to run in 2002 as much against President Bush as against=20 whomever the state GOP nominates in the gubernatorial race. In return=20 Republicans are trying to shift the focus back toward Davis--most=20 aggressively through a California-wide television advertising campaign=20 organized by Scott Reed a former executive director of the Republican=20 National Committee. ?????Our goal is to get the focus back to Sacramento where it belongs= =20 Reed said. ?????Both sides see the same prize in this tug of war: the opportunity to= =20 determine where most Californians direct their anger during what could be a= =20 long hot summer of power shortages. ?????The situation is that the public's minds are not made up on this=20 issue--whether it is Sacramento or Washington who has acted too little too= =20 late said Mark Baldassare a pollster at the independent Public Policy=20 Institute of California. That gives both sides an opportunity to get their= =20 messages out. The stakes are fairly high in terms of how the public in=20 California ends up assessing blame over the next few months. ?????A Slight Uptick in Davis' Popularity ?????Overall Davis' political situation appears to be stabilizing. After= =20 months of runaway power costs the prices the state pays for wholesale=20 electricity are falling and new plants will come online next month. And=20 following a free fall in private polls Davis has seen his numbers tick bac= k=20 up slightly. Similarly a poll financed by independent power generators=20 showed that in mid-June for the first time in months Californians were=20 becoming slightly more confident that the crisis is easing. ?????Within the state Capitol Davis is asserting himself demanding that= =20 lawmakers hold hearings on his rescue plan for Southern California Edison. = On=20 Monday he released details of a similar plan for San Diego Gas & Electric.= =20 Last week he announced an agreement that is likely to increase generation = by=20 alternative energy producers who account for about a fourth of the state's= =20 supply. ?????This guy is changing said state Sen. Steve Peace (D-El Cajon) who = a=20 few months back had been urging that Davis take a more aggressive stance on= =20 the crisis. There is a difference in his demeanor and focus. ?????Yet the energy crisis still looms as a vast cloud over a reelection=20 campaign that once looked like a stroll on the beach. ?????The paradox for Davis is that the substantive victory for pricecontrol= =20 advocates at the Federal Energy Regulatory Commission meeting this week may= =20 complicate his political goal of maintaining a heavy focus on Washington.= =20 Though Davis and some congressional Democrats portrayed FERC's decision as= =20 insufficient it appears to have lanced the pressure for federal legislatio= n=20 to impose the tighter price controls that Davis supports.=20 ?????Sen. Dianne Feinstein (D-Calif.) a principal sponsor of that bill on= =20 Tuesday announced she would shelve the measure for six months to give the n= ew=20 FERC plan time to work. ?????As a result the political effect of the FERC ruling could be to shift= =20 the focus away from Washington back toward decisions in Sacramento which i= s=20 exactly what Republicans prefer. Gray Davis is the dog that finally caught= =20 the car said Dan Schnur a San Francisco-based GOP consultant. Davis is= =20 going to keep screaming about price caps and refunds but now Republicans c= an=20 point to substantive action. ?????Davis: 'Much More They Should Do' ?????For months Davis has criticized Bush for refusing to support=20 electricity price controls and other measures that the governor says could= =20 ease California's energy crunch. At almost every opportunity Davis offers= =20 the same message: California is taking the steps it needs to but Washingto= n=20 has failed to help enough. That was precisely Davis' message Monday when FE= RC=20 significantly expanded the limited price caps it had imposed previously. ?????While saying that FERC had finally taken a step in the right=20 direction Davis added: There is much more they should do--including=20 providing refunds to California for alleged overcharges. The overall tone o= f=20 Davis' statement was much more skeptical about FERC's action than the remar= ks=20 from Feinstein who described the decision as a giant step forward. ?????Aides say Davis plans to repeat that two-part message in his appearanc= e=20 today before the Senate Governmental Affairs Committee chaired by Sen.=20 Joseph I. Lieberman (D-Conn.). In his testimony and in a round of schedule= d=20 television appearances Davis will demand that FERC order refunds in the=20 range of $5 billion to $6 billion to the state aides said. Davis also will= =20 distribute to every member of Congress a 177-page book chronicling the=20 state's response to the crisis. ?????Inside the Bush White House some officials see in Davis' cool respons= e=20 to FERC's decision more evidence that the governor is determined to use the= =20 White House as a foil in his reelection campaign. The prevailing view one= =20 official said is that no matter what concessions the administration offer= s=20 Davis will immediately raise the bar and demand something else--the way he= =20 did by talking about rebates as soon as FERC offered tougher price controls= . ?????That is Davis' M.O. said one official involved in the White House's= =20 energy strategy. He asks the administration to do something the=20 administration does it and then he attacks the administration for not doin= g=20 enough. . . . He needs someone to blame. ?????Davis aides reject that characterization arguing that the governor is= =20 merely representing the state's interests against an administration that th= ey=20 maintain is favoring energy producers over consumers. But Davis advisors=20 acknowledge that they have used focus groups to test campaign messages that= =20 pin the blame for the energy crunch primarily on Davis' Republican=20 predecessor Pete Wilson and a Republican president who has failed to sto= p=20 his rich friends in the energy industry from gouging consumers one aide= =20 said. ?????You don't have to tell people in focus groups more than once how this= =20 is connected the Davis aide said. ?????Gubernatorial Rivals Are Free of Blame ?????Baldassare the independent pollster notes it may be especially=20 imperative for Davis to keep Bush's energy decisions in the spotlight becau= se=20 none of his potential Republican opponents in 2002--California Secretary of= =20 State Bill Jones former Los Angeles Mayor Richard Riordan or businessman= =20 William E. Simon Jr.--is easily tagged with complicity in the problem. Non= e=20 of them were really involved in the decision-making over deregulation=20 Baldassare said. The only one else to blame in a political sense is=20 Washington and the Bush administration. ?????The new independent advertising campaign against Davis was inspired=20 largely by the fear of that strategy succeeding--damaging the standing in= =20 California not only of Bush but also of other Republicans particularly tho= se=20 in Congress. Reed whose American Taxpayers Alliance is funding the ads sa= id=20 he decided to launch the campaign after Davis appeared to gain the upper ha= nd=20 in the media debate following Bush's visit to California late last month. ?????The Bush trip really changed the terms of debate about Davis' problem= =20 and made it more of a possible national Republican problem Reed said. Th= e=20 entire terms of debate turned around and was focused on the issue of price= =20 caps as opposed to negligence on Davis' behalf. Our group is attempting to = go=20 out and engage Davis. ?????To engage Davis Reed's group which has not revealed its donors is= =20 spending what he said would be $1.5 million on an initial ad criticizing=20 Davis this week though a spot check of TV stations around the state=20 indicated a far more modest buy. Reed said the group is planning to air a n= ew=20 ad as soon as this week. ?????Democrats plan to answer the ads with attacks of their own and will be= =20 filing complaints with the IRS and other federal agencies about the anonymo= us=20 funding of the Reed ad. ?????Today's Senate hearing will give Davis another chance to respond to th= e=20 GOP and make his case for greater help from Washington. But Lieberman aides= =20 acknowledge the hearing is likely to be much less confrontational than it= =20 would have been if FERC had not acted Monday. The agency's decision change= d=20 the dynamic the aide said. ?????That assessment may apply not only to the conflict between FERC and it= s=20 critics but also equally to the hostilities between Davis and the White Hou= se. ---=20 ?????Times staff writers Dan Morain in Sacramento and Mark Z. Barabak in Lo= s=20 Angeles contributed to this story. Copyright 2001 Los Angeles Times=20 Blackout Forecasts' Dark Side=20 If optimists are wrong and the power runs out California's energy crisis= =20 could quickly cost lives and cripple the economy.=20 By JENIFER WARREN Times Staff Writer=20 ?????It's here. Summer 2001 the blackout season is only a day away. ?????Already Californians anticipate power outages when temperatures rise. = By=20 August the occasional annoyances endured so far--stoplights gone dark=20 computers air conditioners and elevators idled--could seem almost quaint. ?????Gov. Gray Davis insists we needn't worry. Four large new power plants= =20 are firing up soon he said and government's best and brightest are lockin= g=20 up still more megawatts to help meet our peak summer need. Californians=20 Davis predicts will valiantly heed his call to conserve helping the state= =20 survive the hot months no sweat. ?????With luck he'll be right. Power prices have stabilized and some ener= gy=20 analysts are wondering whether California may have tamed the blackout beast= . ?????But what if those plants don't get built in time people don't trim=20 their electricity use 7% and energy imports are more meager than expected? ?????And what if the state gets hit by a summer that is not moderately hot= =20 as Davis bets but blistering record-setting hot? ?????Government experts who ponder such questions don't expect disaster in= =20 the coming months. But they are planning for it nonetheless. ?????At best they say Californians can expect some gridlocked=20 intersections an occasionally overloaded 911 system perhaps some business= =20 bankruptcies certainly inconvenience. At worst the Western power grid cou= ld=20 crash causing uncontrolled blackouts that might lead to looting=20 contaminated water supplies even civil unrest. ?????How bad could this summer get? said state Sen. Joe Dunn (D-Santa Ana= ).=20 This summer could be the worst disaster to ever hit the state of Californi= a. ?????Imagine it's a Thursday morning in the third week of July. Relentless= =20 heat grips California the curse of a stubborn high-pressure ridge that jus= t=20 won't budge. ?????As air conditioners from Redding to Chula Vista lumber to life manage= rs=20 of the state's power grid in Folsom gulp their third and fourth cups of=20 coffee stare at a bank of computers and begin to fret. ?????Demand is jumping. Supply is static Canada and Arizona have nothing t= o=20 sell. It's looking tight. ?????Thirty minutes later the picture is gloomier. A brush fire shuts down= =20 transmission lines near Fresno squeezing supply in the Central Valley. In= =20 the Bay Area the unusual heat drives demand well past projections. ?????By noon things look bleak. Operators of the Diablo Canyon nuclear powe= r=20 plant near San Luis Obispo have cut output by 80%. The trouble? Chunks of= =20 kelp have lodged in one of the plant's seawater intake valves creating a= =20 clog like one that plagued the facility in January. ?????With a chorus of groans the grid's keepers scour the market for power= =20 to offset the Diablo loss. No luck. As the mercury climbs and the Golden=20 State economy roars into full swing electricity consumption ticks upward= =20 minute by minute. And when managers of a power plant near Long Beach cut=20 output because of a cracked turbine everyone knows what it means. ?????Alert the utilities. It's lights out California for the fourth day i= n=20 a row. ?????Dr. J. Michael Leary dreads blackouts--not personally but=20 professionally. Leary is an emergency room physician in the desert city of= =20 Rancho Mirage. When air conditioners go on the blink there the=20 victims--scores of them mostly old folks--wind up in his ER. ?????In a normal year 75% of his emergency patients are geriatrics. Like= =20 infants the elderly are unusually vulnerable to the heat. When blackouts= =20 hit they are most at risk. ?????It's as if you lived in Maine and they turned the heat off in January= =20 Leary said. This is an extreme environment we live in. The effects can be= =20 devastating. ?????Many desert seniors are on fixed incomes and live in mobile homes som= e=20 of them poorly insulated boxes that turn into ovens under the brutal summer= =20 sun. Take away the air conditioning and the humans inside start baking qui= ck. ?????For Leary the specter of continual back-to-back blackouts in=20 July--and some predict in June and August too--conjures images of an=20 82-year-old man living alone in one of those mobile homes taking medicati= on=20 for heart disease. The cardiovascular drugs plague the man with numerous si= de=20 effects one inhibits his body's ability to cool itself. ?????When a person gets overheated body temperature eventually rises=20 uncontrollably. Then comes a nasty spiral of effects and pretty soon you = go=20 into shock Leary said. Everything just shuts down. ?????On average each year 371 Americans die from heat-related causes more= =20 than the number killed by earthquakes tornadoes hurricanes lightning and= =20 floods combined. In 1995 a record hot spell in Chicago killed 465 people.= =20 Eleven Californians died from the heat in 1998. ?????A new report by the United Seniors Assn. predicts that more than half = a=20 million elderly Californians could need hospitalization for heat-related=20 ailments this summer.=20 ?????Some communities have laid plans for cooling shelters wading pools an= d=20 other measures to provide relief. But will all who need help get it? Or get= =20 it in time? ?????Out in the desert paramedics expect a crush of 911 calls when the pow= er=20 goes out and the ill frail and frightened seek help. Leary and others at= =20 Eisenhower Medical Center will be waiting armed with ice packs cooled IVs= =20 and ventilators. ?????I am very very worried the doctor said. I think we'll see a great= =20 toll in human suffering even mortality. ?????California's tomato processors are no less anxious. They wash cook= =20 peel chop mash and can about 1 million tons of tomatoes a week from July = to=20 October--enough to account for half the world's supply. For them a string = of=20 unexpected power losses could mean economic ruin in a matter of days. ?????The reason lies in the peculiar nature of food processing--a sterile= =20 system instantly contaminated if the power fails and the plant's precise=20 temperature is disturbed. ?????Once a batch of tomatoes is tainted it must be thrown out--all 50000= =20 pounds. The plant must then be sanitized a painstaking process that takes= =20 about 36 hours. ?????If you get hit by blackouts every third day for say two weeks you'= re=20 starting stopping cleaning restarting--it's a nightmare said Jeff Boes= e=20 president of the California League of Food Processors. You could lose thre= e=20 batches and be out $40 million before you knew what hit you. ?????Meanwhile farmers with still more truckloads of tomatoes line up=20 outside the plant waiting to be paid for their crop: If we can't process= =20 them the farmers have spent an entire season growing them for nothing=20 Boese said. ?????In Sonoma County the object in peril is the chicken. Egg producers=20 equip their laying houses with fans and swamp coolers to keep the hens=20 comfortable. Power is also needed to run giant refrigerators filled with eg= gs. ?????In a blackout those hens can overheat in no time said Rich Matteis= =20 of the Pacific Egg and Poultry Assn. In 20 or 30 minutes you could have= =20 100000 birds die. ?????Many large producers have backup generators but they are not designed= =20 for ongoing intensive use. Will they hold up? Small-scale egg producers=20 often have no backup power at all. ?????Hundreds of other California businesses could suffer if summer shapes = up=20 as bad as some predict. ?????The Valero Refining Co. of California northeast of San Francisco=20 produces 115000 barrels of gasoline a day. Because restarting a refinery i= s=20 a complicated task two or three blackouts close together could prompt=20 officials to shutter it until electricity supplies stabilize--costing=20 California about 10% of its gasoline supply. ?????At a Berkeley medical laboratory doctors say power losses to their=20 freezers could destroy bone marrow needed to give young leukemia patients= =20 lifesaving transplants. The state's 400 dialysis centers where patients=20 without kidney function go to have their blood cleansed every other day ar= e=20 in the same fix. Few have backup generators so when an outage hits=20 technicians must crank the machines by hand. ?????Most Californians of course face far more ordinary consequences. The= =20 scoreboards will fizzle at summer softball games joggers on treadmills wil= l=20 be stopped in their tracks electric organs will go silent leaving choirs = to=20 sing without accompaniment. ?????Parents will be asked to retrieve children from day-care centers when= =20 the lights and cooling systems conk out. Anniversary lunches may be ruined= =20 when restaurants cannot grill salmon or blend margaritas. ?????Most people will tolerate occasional disturbances psychologists say= =20 doing their part in a time of crisis. But what if such irritations become a= n=20 everyday fact of life? ?????Hundreds of essential energy users--including prisons fire=20 departments and airports--are protected from blackouts and hundreds more= =20 have applied for exemptions. That means the pool of people bearing the=20 blackout burden is shrinking so more frequent outages are likely. ?????Blackout predictions vary widely but at least one forecaster a=20 consultant for California water districts anticipates an outage almost eve= ry=20 afternoon of every workday this summer if temperatures are unusually warm. ?????Californians are accustomed to trash compactors giant-screen TVs and= =20 having the Internet at their fingertips. How much deprivation will they=20 tolerate? ?????So far the version of blackouts we've experienced hasn't looked too= =20 scary to people--it happens on a workday in the afternoon and you basical= ly=20 have to come home and reset your VCR said Dan Kammen a professor of ener= gy=20 and society at UC Berkeley. ?????But if outages become daily events and start to invade the evening=20 hours the public mood could change abruptly. ?????When there's a disaster or crisis or trauma people tend to act=20 heroically and work together said Robert Butterworth a Los Angeles=20 psychologist and trauma specialist. But the civilized behavior only lasts = a=20 short period. Then people start acting in unpredictable ways. ?????That tendency may be exacerbated Butterworth said by the nature of t= he=20 energy crisis--not a natural disaster but a man-made one. ?????People start to look for a scapegoat he said. People will look for= a=20 target and there's a tendency to strike out at whoever is closest to you. ?????One place that tendency may surface Butterworth said is on=20 traffic-clogged roads. Blackouts already have led to scores of accidents. A= dd=20 summer heat to the mix and repeat the pattern day after day at rush hour= =20 and motorists' patience could wear thin law enforcement officials say. ?????We're bracing for . . . possible acts of violence and road rage sai= d=20 Sacramento County Sheriff's Lt. Larry Saunders. ?????Lon House is the water consultant who predicts California could see=20 blackouts almost every summer weekday. Among the worries for the 440 water= =20 agencies he represents: losing the ability to pump water during wildfire=20 season. ?????I'm telling them to be ready for a major earthquake every day this=20 summer--meaning all your power is out throughout your district for multiple= =20 hours House said. ?????House insists he isn't an alarmist. But on top of the fire fears he= =20 warns that blackouts of more than a few hours would allow air into water=20 pipes contaminating supplies. If that happens Californians would be urged= =20 to boil their water until the system can be disinfected from one end of the= =20 pipe to the other. ?????Though rolling blackouts are risky they remain essentially a controll= ed=20 phenomenon occurring when and where the grid managers and utilities decide= .=20 Far more frightening--and devastating--are unexpected cascading outages th= at=20 could shut down the entire Western power grid. It happened in August 1996= =20 leaving 4 million people without power during a triple-digit heat wave. ?????The problem began when power lines in Oregon sagged into trees and shu= t=20 themselves off. That triggered a chain reaction of automatic switch-offs an= d=20 oscillating surges of energy that ultimately shut down all four of the main= =20 power arteries between California and the Pacific Northwest. ?????That robbed the system of thousands of megawatts--enough to power the= =20 city of Seattle four times over--and scattered outages across California an= d=20 six other Western states. Thousands of customers were without power for mor= e=20 than a day. ?????Though such an episode is rare California grid managers say it is mor= e=20 likely today because the system is taxed by the ever-increasing load of=20 electricity it bears. ?????The system is very dynamic and when it's heavily loaded and highly= =20 stressed like it is now the smallest little thing could cause big trouble= =20 said Kevin Bakker who oversees California's connection to the greater=20 Western power grid.=20 ?????If a massive uncontrolled outage should hit the ramifications could = be=20 dizzying said Mike Guerin chief of law enforcement for the state Office o= f=20 Emergency Services. Police departments would probably go to tactical alert= =20 guarding against looting by criminals who might take advantage of disabled= =20 alarm systems and darkened street lights. ?????In hot areas cities might convert municipal buses--parked with air=20 conditioners running--into cooling shelters Guerin said. The state would= =20 provide emergency generators to nursing homes and others in need while the= =20 California National Guard might be called into action. ?????With this kind of blackout scenario you're not worried about the=20 bologna going bad in the refrigerator Guerin said. We're talking about= =20 doctors doing surgeries on backup generators for three days. We're talking= =20 about a lot of things we don't like to think about. ---=20 ?????Times staff writers Nancy Vogel and Alexander Gronke and researcher=20 Patti Williams contributed to this story. Copyright 2001 Los Angeles Times=20 FERC Move Short-Circuits Push for Hard Price Caps=20 By RICHARD T. COOPER and JANET HOOK Times Staff Writers=20 ?????WASHINGTON--The Federal Energy Regulatory Commission's decision to=20 impose full-time price ceilings on wholesale electricity in California and= =20 the West appears to have deflated the congressional drive for a return to= =20 traditional utility regulation. ?????Sen. Dianne Feinstein (D-Calif.) calling the price mitigation syste= m=20 FERC unveiled Monday a giant step forward announced Tuesday that she is= =20 pulling back her bill to force a return to the cost of service pricing=20 system that prevailed before deregulation. Republican Sen. Gordon Smith of= =20 Oregon a co-sponsor agreed as did Sen. Jeff Bingaman (D-N.M.) chairman = of=20 the Senate Energy Committee. ?????House Democrats vowed to fight on for tougher controls but they were= =20 given little chance to succeed. ?????As a result although the political blame game will rage on the reali= ty=20 of a long ugly summer for California appears to have arrived: at least=20 several months of tears toil sweat--and fast-rising electric bills. ?????California consumers are likely to face an unpleasant paradox energy= =20 analysts said: Given present power shortages blackouts are virtually=20 inevitable this summer. And since state authorities are beginning to let= =20 high wholesale prices flow through into retail bills after months of=20 subsidies many consumers could face higher charges at the same time their= =20 lights begin to flicker. ?????Even if FERC's order succeeds and wholesale prices fall as they have= =20 begun to do in recent weeks consumers' bills are likely to rise. Since=20 retail charges lag well behind wholesale prices closing the gap will=20 probably mean a period of higher costs for consumers regardless of what=20 happens in wholesale markets. ?????There is light at the end of the tunnel energy analysts said but it = is=20 probably a year away. And reaching it they said depends in part on=20 government officials taking no action that might spook investors and disrup= t=20 present plans for expanding the region's capacity to generate and deliver= =20 more power. ?????The new FERC system which its designers said would provide temporary= =20 price relief while preserving incentives for energy investment imposes=20 cost-based curbs on wholesale prices throughout the West and covers all suc= h=20 sales not just those during periods of extreme shortages as did the order= =20 issued in April. ?????FERC Chairman Curtis L. Hebert Jr. told the committee the new system= =20 will prevent megawatt laundering and other potential abuses. He said his= =20 agency is committed to ferreting out any forms of market misbehavior 24=20 hours a day seven days a week. ?????With the apparent collapse of demands for more intervention Congress= =20 now seems ready to give FERC a year or more of leeway to see whether its pl= an=20 will curb wholesale prices and create what FERC member Linda Breathitt a= =20 Democrat called a breathing spell in which California and the West can= =20 repair their dysfunctional markets. ?????It still remains to be seen whether there can be manipulation but I= =20 think we should wait and see Feinstein said Tuesday at a Senate Energy=20 Committee meeting attended by all five FERC members. The commissioners call= =20 their new system price mitigation not price caps but Feinstein said it= =20 amounts to the same thing. ?????Whether you call it price mitigation or something else a rose is a= =20 rose is a rose said Feinstein a member of the energy committee. ?????And Sen. Barbara Boxer (D-Calif.) appearing before the committee as a= =20 witness said: I was very pleased with [Monday's] about-face by FERC. I=20 believe they have a new tone. ?????Democrats on the other side of the Capitol pledged to keep fighting fo= r=20 traditional regulation but with Republicans in control of the House the= =20 struggle appears to be largely symbolic. ?????House Democrats wanted to introduce amendments on price controls and= =20 other energy policy to a mid-year supplemental appropriation bill due to co= me=20 before the House today. However GOP leaders expected to block Democrats fr= om=20 even offering the amendments on procedural grounds. ?????The most sweeping of the amendments would set cost-based limits on=20 wholesale energy prices in the West. Rep. Henry A. Waxman (D-Los Angeles) a= nd=20 other sponsors insisted that the measure is still needed in spite of the FE= RC=20 action which he said would continue to provide windfall profits to=20 generators encourage suppliers to withhold power and do too little to=20 restrain the price of natural gas. ?????He called the FERC policy an experiment that is using California and= =20 other Western states as subjects. ?????Similarly Rep. Nancy Pelosi (D-San Francisco) said: Although the FER= C=20 decision [Monday] is a step in the right direction I am concerned it does= =20 not remove incentives for energy suppliers to withhold power drive up pric= es=20 and gouge consumers. ?????The commission went as far as it did in part because of the specter of= =20 broader price control legislation Pelosi said. They felt the heat they s= aw=20 the amendments coming and decided to act. ?????And Rep. Bob Filner (D-San Diego) in an interview Tuesday said he wi= ll=20 press ahead with legislation to impose hard price caps. I would advise the= =20 senators that after a year of dealing with these price gougers that they wi= ll=20 easily manipulate this latest order he said calling it a Swiss cheese= =20 order--full of holes.=20 ?????Feinstein's shift put House Democrats in an awkward political position= =20 because it came just as they prepared to make their big push for tougher=20 controls. But the Democrats tried to minimize the differences in legislativ= e=20 strategy. ?????She too is waiting to see if the FERC experiment works Waxman said.= =20 I'm a little more skeptical but we're both watching carefully. ?????As a political matter a Democratic leadership aide acknowledged the= =20 FERC order muddies the debate at a time when Democrats have been working ha= rd=20 to make it a defining issue--and one they had hoped would help them win=20 control of the House in the 2002 elections. ?????It's hard to describe to people what the difference is between what w= e=20 want and what FERC has done said the aide. ?????And Republicans said FERC's action had clearly taken the wind out of t= he=20 sails of price control efforts that some GOP strategists feared might have= =20 passed the House. ?????I would have thought [it would pass] last week said John Feehery= =20 spokesman for House Speaker J. Dennis Hastert (R-Ill.). But now with what= =20 FERC did it takes a lot of air out of the balloon. ?????I think the FERC action will dissipate that strong push agreed Emil= y=20 Miller a spokeswoman for House Majority Whip Tom DeLay (R-Texas). It will= =20 take the heat off. ?????House Majority Leader Dick Armey (R-Texas) said the message to Democra= ts=20 was It's time to come off your political high horse. ?????He said he wanted to keep Democrats from offering their price control= =20 amendment to Wednesday's supplemental appropriation bill because the propos= al=20 is a political statement not a policy statement. ---=20 ?????Times staff writers Megan Garvey and Richard Simon contributed to this= =20 story. Copyright 2001 Los Angeles Times=20 Plan Won't Raise Rates Davis Says=20 Edison: Governor seeks to assure Senate where Democrats say action is a=20 bailout of nearly bankrupt utility.=20 By CARL INGRAM Times Staff Writer=20 ?????SACRAMENTO--Gov. Gray Davis sought to assure the state Senate on Tuesd= ay=20 that his plan to save Southern California Edison from threatened financial= =20 collapse would work without increasing customer rates. ?????Davis sent assurances to the Senate Energy Committee through his top= =20 attorney Barry Goode who helped negotiate the controversial proposal with= =20 the utility. ?????Senate Republicans have taken a wait-and-see attitude on the plan. But= =20 they generally contend that the business of utilities belongs in the hands = of=20 private enterprise. ?????But Democrats in both houses have charged that the deal between Democr= at=20 Davis and Edison represents a state bailout of the nearly bankrupt=20 Rosemead-based utility. The analysis is shared by leading consumer activist= s. ?????At the first in a series of Senate hearings on the package which is= =20 considered all but dead in its current form Sen. Byron Sher (D-Palo Alto)= =20 voiced concerns about political problems with the plan. ?????He asked Goode who was flanked at a witness table by Edison executive= s=20 whether monthly bills of the utility's customers would increase as a=20 consequence of approval of the governor's package. ?????Our models say there will be no additional impact on the ratepayers= =20 Goode replied. ?????Other members appeared ready to pursue rate increase questions but=20 Chairwoman Debra Bowen (D-Marina del Rey) cut them short. She said the issu= e=20 would be fully examined at a later hearing. ?????To spare Edison from going into bankruptcy and to restore its=20 credit-worthiness Davis and executives of the utility reached a complex=20 compromise in April the centerpiece of which was a state purchase of=20 Edison's transmission grid for about $2.8 billion more than twice its book= =20 value. ?????Edison has estimated that it owes $3.5 billion to creditors including= =20 wholesale power generators as a result of deregulation of retail electrici= ty=20 prices in 1996. ?????Because of a freeze in retail rates Edison was prohibited from passin= g=20 its energy costs to customers. ?????Other features of the deal include dedicating a portion of consumer=20 rates to help pay off the debt a guaranteed 11.6% rate of return to Edison= =20 on its sales and investments and termination of an ongoing Public Utilitie= s=20 Commission investigation into financial dealings of Edison's parent company= =20 Edison International. ?????The energy committee held the hearing for fact-finding purposes and di= d=20 not consider the Edison bill SB 78x by Sen. Richard Polanco (D-Los Angeles= ). ?????But the Davis-Edison deal has angered consumer activists who contende= d=20 that bankruptcy for Edison would be preferable. ?????They deplored it as a bailout that would cost Edison customers $5=20 billion to $7 billion. ?????If the Legislature makes the mistake of forcing the ratepayers of=20 California to pay one more penny to bail out these companies we will put [= an=20 initiative] right on the ballot said Harvey Rosenfield of the Foundation= =20 for Taxpayer and Consumer Rights. ?????Consumer organizations in 1998 put to the voters an initiative to junk= =20 the 1996 deregulation law. The measure failed. ?????Rosenfield Harry Snyder of Consumers Union and Matt Freedman of the= =20 Utility Reform Network all asserted at a news conference that the Davis=20 rescue program should be killed. ?????Snyder who opposed deregulation said the governor's bill is shaping = up=20 as a replay of 1996. ?????It's too big too complicated. . . . This is the same process that=20 brought about this [deregulation] disaster Snyder said. ?????Separately San Diego Gas & Electric agreed Monday to sell its=20 transmission grid to the state for about $1 billion on the same terms as=20 Edison. ?????With all the controversy surrounding the Edison deal the chance of=20 SDG&E winning legislative approval of its sale is slightly better than 50%= =20 said Stephen L. Baum chief executive of Sempra Energy parent of SDG&E. ?????I think there's a widely shared view in the Legislature that they don= 't=20 want the state in the long-term business of power procurement. . . . In ord= er=20 to get Edison back into that business there has to be this infusion of=20 capital to pay off past electricity debts and make the utility=20 credit-worthy Baum said. ---=20 ?????Times staff writer Nancy Rivera Brooks contributed to this story. Copyright 2001 Los Angeles Times=20 State to Pay Electric Bill With Loan Not Taxes=20 By MIGUEL BUSTILLO Times Staff Writer=20 ?????SACRAMENTO--California taxpayers who have had to bankroll billions of= =20 dollars in electricity purchases for the teetering power utilities will so= on=20 no longer see their money evaporate at record rates under an executive ord= er=20 by Gov. Gray Davis. ?????As early as next week the order will stop the hemorrhaging of the sta= te=20 budget by allowing Treasurer Phil Angelides to borrow $5 billion to buy=20 electricity. That money is expected to cover power purchases until this fal= l=20 when the state plans to sell an unprecedented $12.5 billion in bonds to rep= ay=20 the general tax fund and buy future electricity. ?????Angelides said Tuesday that he has already lined up $3.5 billion in=20 loans from two Wall Street firms and expects to secure at least another=20 billion by next week when he plans to close the deal and obtain the money. ?????The loan is critical he said because without it electricity purchas= es=20 would completely deplete state coffers as early as October. ?????In essence it stops the general-fund bleeding Angelides said. Wha= t=20 this interim financing does is take the pressure off the general fund and= =20 hopefully avert a cash crisis. ?????The loan could also ease concerns on Wall Street that California's ris= ky=20 entry into the power business has placed the state budget in a precarious= =20 position. Those concerns were one of the main reasons two major credit rati= ng=20 agencies downgraded the state earlier this year. ?????We have been looking forward to this day said Ray Murphy a vice=20 president at Moody's Investors Service one of the two firms that downgrade= d=20 California's credit rating. We view this as a positive first step toward= =20 getting the state out of the power business. We wanted the state to get the= =20 general fund out of the business as quickly as possible. ?????California has allocated $8.2 billion in taxpayer money for electricit= y=20 since January because the state's private utilities became too saddled with= =20 debt to continue purchasing power on the open market. and massive blackouts= =20 loomed. ?????Under a plan devised by Davis and approved by the Legislature the sta= te=20 budget is supposed to be reimbursed for the power purchases with the bond= =20 issue the largest in American history. The bonds in turn are to be paid= =20 off by utility ratepayers through their monthly bills. ?????The bond issue however has been delayed by partisan politics and=20 complex legal issues raised by the bankruptcy of Pacific Gas & Electric Co.= =20 the state's largest private utility. ?????A bond sale initially planned for May is now scheduled for late=20 September according to Angelides' latest estimate. The state's Public=20 Utilities Commission still needs to take a number of technical actions befo= re=20 the sale can take place. ?????As a result the state budget has been drained for power purchases far= =20 longer than initially anticipated--a situation that has imperiled spending = on=20 education transportation and other critical needs at least temporarily. ?????Angelides had earlier sought to secure a $4-billion bridge loan to rep= ay=20 the state budget for power purchases until the bonds were sold but was=20 rebuffed by Republicans in the Legislature who argued that the loan was no= t=20 necessary. ?????Davis' executive order issued late Monday as part of the Democratic= =20 governor's emergency powers during the energy crisis gives Angelides the= =20 authority to press ahead. ?????But it does not allow the treasurer to use the loan to repay the budge= t=20 for the billions spent so far this year on electricity as he had originall= y=20 intended. Rather it permits Angelides to use the loan proceeds to assist t= he=20 Department of Water Resources the state agency buying power with its futu= re=20 electricity expenses. ?????If the bond issue is further delayed Angelides estimated the loan=20 would gives California another four to six months before it would begin to= =20 run out of money. Furthermore the loan closes a potential loophole that=20 existed in the long-term contracts Davis had signed to stabilize the cost o= f=20 electricity which would have let power suppliers walk away from the deals = if=20 the state had not secured a source of financing by next month. ?????But Republicans warned that by entering into a bridge loan deal withou= t=20 knowing when the bonds would be sold Davis and the Democrats were incurrin= g=20 major risks that could further drive up the price tag of the crisis. ?????The loan carries a blended interest rate of about 4.5% but if it is n= ot=20 repaid by Oct. 31 the rate jumps to 7%. Because the loan is to be repaid b= y=20 the bonds which have been marred by a history of delay GOP officials=20 Tuesday were already calling the bridge loan a bridge to nowhere. ?????The thing that is most troubling is that the governor did not bother = to=20 consult with anyone said Assembly Republican leader Dave Cox (R-Fair Oaks= )=20 who learned of Davis' order from reporters. It's disappointing but the=20 governor does not seem to recognize there is a legislative branch. Copyright 2001 Los Angeles Times=20 Edison Unveils Blackout Warning Plan=20 Technology: The utility will notify customers by Internet and telephone whe= n=20 power might go out.=20 By DANIEL HERNANDEZ Times Staff Writer ?????Southern California Edison on Tuesday unveiled a system that will=20 forecast coming blackouts over the Internet and by telephone.=20 ?????Ordered by the state to create a warning system for customers as=20 California enters a summer that will almost certainly include rotating=20 blackouts Edison is also preparing to use automatic phone calls faxes and= =20 wireless communications to alert subscribers to outages.=20 ?????With these steps Edison is complying with an order by the state Publi= c=20 Utilities Commission which in April told the company to notify customers o= f=20 coming outages. Privately held Pacific Gas and Electric Co. established a= =20 similar program months ago.=20 ?????Edison previously opposed a notification system arguing that such a= =20 system could incite looters and burglars. But police agencies including th= e=20 Los Angeles County Sheriff's Department saw more danger in not warning=20 customers said Richard Rosenblum an Edison senior vice president. ?????On balance [we concluded] it was preferable for public safety to mak= e=20 that information available Rosenblum said. ?????Consumer advocates said Edison's notification system is welcome if=20 tardy. ?????It's fair to say that Edison has been a little behind where PG&E has= =20 been in trying to implement this said Mike Florio an attorney with the= =20 Utility Reform Network and a member of the California Independent System=20 Operator board which runs the state power grid. ?????Edison's Web site www.sce.com now features a pop-up screen that warn= s=20 of any blackouts coming in the next hour. It also links to a page which ca= n=20 be reached at www.outagewatch.com that forecasts which outage groups wil= l=20 be cut off next in the event of rotating blackouts. Detailed maps outline= =20 which areas are included in each group.=20 ?????The new Web features are expected to handle about 4 million simultaneo= us=20 users. Beginning this month Edison customers also can learn their block=20 number by looking at their bills said Edison spokesman Gil Alexander. ?????Outage information also will be made available on an automated phone= =20 line (800) 611-1911. ?????Edison officials are negotiating with another company to provide=20 additional warnings by e-mail fax phone and wireless communications. SDG&= E=20 which like Edison was required to inform customers of outage forecasts has= =20 moved more quickly providing large industrial customers with blackout=20 notification via pager since June 4. ?????Up-to-the-minute outage reports also will be provided in several=20 languages to radio and TV stations Edison officials said. ?????Edison officials emphasized that the new alert system can never be 100= %=20 accurate and that sudden blackouts although rare are always a possibilit= y.=20 ?????We have planned as aggressively as we think is warranted understandi= ng=20 that you can't predict how your customers will respond Alexander said. Copyright 2001 Los Angeles Times=20 State Joins Challenge to Bush on Air-Conditioner Standards=20 Regulations: U.S. rolled back Clinton rule from 30% increase in efficiency = to=20 20% on manufacturers' urging.=20 By JENIFER WARREN Times Staff Writer=20 ?????California and two other states joined environmentalists Tuesday in=20 suing the Bush administration over its decision to weaken efficiency=20 standards for home air conditioners. ?????The lawsuit caps weeks of criticism heaped on the administration after= =20 it rolled back a rule requiring manufacturers to increase the efficiency of= =20 air conditioners 30% by 2006. ?????That rule was adopted by President Clinton during his final days in=20 office and after years of research and debate. California and other=20 states--including Texas--endorsed it as a way to substantially cut energy u= se=20 and improve air quality. ?????But after reviewing the rule at the industry's behest Bush=20 administration officials in April sliced the mandated increase to 20%. The= =20 higher standard they said would have made home coolers too expensive=20 especially for the poor. ?????Conservationists and consumer groups blasted the policy change callin= g=20 it shortsighted at a time when California and other states are enduring an= =20 energy crunch. ?????In California residential air-conditioning accounts for about 15% of= =20 the peak energy demand. Weakening efficiency standards critics say will= =20 require as many as 60 new power plants nationwide four in California. ?????This is a time when we need to conserve electricity and reduce our=20 dependence on the large energy generators and importers state Atty. Gen.= =20 Bill Lockyer said in an interview. Weakening this standard is precisely th= e=20 wrong message at precisely the wrong time. ?????In their lawsuit Lockyer and the attorneys general of New York and=20 Connecticut allege that federal law bars the U.S. Department of Energy from= =20 softening an appliance efficiency standard. A separate but similar suit was= =20 filed by the Natural Resources Defense Council the Consumer Federation of= =20 America and another nonprofit group. ?????Joe Davis the Energy Department's deputy spokesman said there would = be=20 no immediate comment on the suit filed in federal court in Manhattan. He= =20 added however that we believe all of the actions of our decision-making = in=20 the air conditioner standards are well within the law. ?????When Clinton's rule was issued in January his outgoing energy=20 secretary Bill Richardson said the payoff in power savings and cleaner ai= r=20 would be one of the administration's greatest environmental achievements. ?????But a trade association representing air conditioner manufacturers=20 challenged the new rule arguing that it would dramatically increase costs = of=20 the units--priced between $2000 and $4000--and thus discourage people fro= m=20 replacing old ones. ?????The Department of Energy sided with the industry group in April.=20 Officials said Clinton's proposal would have added $335 to the price of a n= ew=20 air conditioner while the lower 20% standard would boost prices only abou= t=20 $213. ?????Others however say those figures do not take into account the=20 economies of scale gained when manufacturers increase production of the mor= e=20 efficient units. When Congress passed the first efficiency standard for air= =20 conditioners in the late 1980s industry said the sky was falling and tha= t=20 it would increase the cost of air conditioners by $700 said Andrew Delask= i=20 executive director of the nonprofit Appliance Standards Awareness Project. = In=20 fact he said U.S. Department of Commerce data showed no price jump. ?????Dan Reicher the assistant secretary of Energy under Clinton who overs= aw=20 development of the stricter standards added that high-efficiency air=20 conditioners are not some exotic untested technology. ?????There are lots and lots of air conditioners already meeting the=20 standards--between 5% and 10% of the units sold today he said. ?????Although most manufacturers support the Bush rollback the second=20 largest maker of air conditioners--Houston-based Goodman Global Holding=20 which produces the Amana brand--opposes it saying any higher upfront costs= =20 would be recovered by consumers in lower utility bills. ?????On Tuesday the company's president John Goodman issued a statement= =20 supporting the lawsuit saying the tougher standard would give consumers a= n=20 enormous cost saving U.S. energy consumption will drop and our environment= =20 will benefit from reduced air pollutant emissions and greenhouse gases. ---=20 ?????Times staff writer James Gerstenzang in Washington contributed to this= =20 story. Copyright 2001 Los Angeles Times=20 New Price Caps Not a Deterrent Power Firms Say=20 Regulation: Producers are unhappy with the federal action but say it is=20 unlikely to discourage them from constructing new plants.=20 By NANCY VOGEL and THOMAS S. MULLIGAN Times Staff Writers=20 ?????The expanded electricity price limits approved by federal regulators= =20 could squeeze big energy traders but will probably not discourage power pla= nt=20 construction in California electricity producers said Tuesday. ?????Power plant owners and marketers said they had not had time to digest= =20 the 53-page order and thus could not say exactly how it would affect=20 California and the 10 other Western states it covers. ?????But the companies generally asserted Tuesday that the order would not= =20 deter them from investing in the vast power-starved Western region--though= =20 they have often raised such a prospect in arguing against price controls. ?????Whatever its long-term effects Monday's order by the Federal Energy= =20 Regulatory Commission appeared to have an immediate effect in dampening=20 prices in California's volatile daily or spot market. ?????The order does not take effect until today but the prospect of new=20 measures aimed at limiting prices appeared to tame markets Tuesday.=20 Californians used more electricity at the late-afternoon peak than on any d= ay=20 this year yet market prices hovered around $100 a megawatt-hour. ?????That is well below the average of $284 a megawatt-hour that the state= =20 paid for electricity from January through April with prices soaring as hig= h=20 as $1900 at times of tight supply. ?????All the markets in the West have come down said Mike Wilczek senio= r=20 power markets reporter for Platts the energy market information division o= f=20 the McGraw-Hill Cos. It's bearish news. ?????Nevertheless several generators minimized the effects of the FERC=20 order contradicting earlier warnings from some industry sources and=20 officials of the Bush administration who consider price limits to be=20 impediments to future investment in power plants. ?????Calpine will have no problem operating under this order said Joe=20 Ronan vice president of regulatory affairs for San Jose-based Calpine Corp= .=20 which has three power plants under construction in California and plans to= =20 build at least three others. ?????The federal order lasts only until September 2002 he said and becaus= e=20 it sets prices based on the cost of running the most expensive inefficient= =20 power plant in the market it should guarantee the owners of modern plants = a=20 profit. ?????Another company planning major investments in California Duke Energy= =20 Corp. of North Carolina said it will not be seriously affected by the=20 federal order because it has sold the output of its four California plants= =20 well into the future. ?????We've already forward-sold 90% of our generation for 2001 and 70% for= =20 2002 company spokesman Pat Mullen said. ?????Reliant Energy Inc. of Houston which owns five power plants in=20 California was not so sanguine about the federal order but it has not=20 backed away from plans to install more generators. ?????We remain committed to California as hard as it is to do business he= re=20 today spokesman Richard Wheatley said. We have plans that are on the=20 drawing boards for at least one possibly two projects. ?????On Monday Reliant Chief Executive Joe Bob Perkins called the FERC=20 action more of a political response than an acknowledgment of the gap=20 between electricity supply and demand in California. ?????Price caps don't work Perkins said and he warned California=20 consumers against assuming that the energy crisis is over simply because=20 wholesale electricity prices have recently dropped to their lowest levels i= n=20 a year. ?????Prices are falling because of mild weather not price controls he sai= d. ?????Without sound economics that increase available supply and reduce pea= k=20 demand . . . consumers can only hope for favorable weather and look forward= =20 to [rolling blackouts] Perkins said. ?????Energy analyst Frederick Schultz of Raymond James & Associates in=20 Houston called the FERC order a nonevent to the California generators=20 because so much of their power is now being sold through long-term contract= s. ?????However every long-term deal reduces the size of the electricity=20 market which supplies about 20% of California's needs. And that in turn= =20 limits trading opportunities for such firms as Enron Corp. which profit on= =20 the daily market's ups and downs Schultz said. ?????Enron representatives did not respond to calls for comment. ?????The federal order imposes round-the-clock price curbs on wholesale=20 electricity sold in 11 Western states that are connected by transmission=20 grids. ?????Under the order traders say market prices will probably hover around= =20 $100 a megawatt-hour depending upon the price of the natural gas that fuel= s=20 most of the state's electric generating plants. Though that is well below= =20 recent market prices it is higher than the average of about $32 a=20 megawatt-hour that California utilities paid in 1999 before the state's=20 deregulated market spiraled out of control. ?????The FERC order dictates that the price for spot market electricity=20 across the West will be based on the cost of producing one megawatt-hour of= =20 power at the least-efficient plant selling to California grid operators. Ma= y=20 31 when a previous FERC order based on a similar formula took effect the= =20 price set was $127 a megawatt-hour. ---=20 ?????Vogel reported from Sacramento Mulligan from New York. Copyright 2001 Los Angeles Times=20 Wednesday June 20 2001=20 The FERC's Action Is Good BadUgly=20 By PETER NAVARRO ?????The Federal Energy Regulatory Commission's new wholesale price caps wi= ll=20 save the Western states literally tens of billions of dollars in electricit= y=20 bills. As wonderful as that sounds the FERC order still allows wholesale= =20 generators to extract enough windfall profits to drive the region into=20 recession.=20 ?????The FERC's approach may also perversely lead to more air pollution and= =20 natural gas shortages.=20 ?????Let's look at what the FERC did right. First the order approved Monda= y=20 establishes price caps on a 24/7 basis rather than simply during power=20 emergencies--a long overdue reform.=20 ?????Second the order protects the entire West not just California. This= =20 regional cap will end megawatt laundering whereby in-state generators so= ld=20 power across California lines and then resold it back into the state to eva= de=20 caps.=20 ?????Third the order closes the ridiculous broker loophole that made the= =20 FERC's previous price caps Swiss cheese. Before generators could redirect= =20 their sales from the market to energy brokers who were exempt from the pric= e=20 caps.=20 ?????So where did the FERC go wrong? The problem may be traced to the two= =20 competing methods of imposing price caps and the all-important concept of= =20 economic rent.=20 ?????Economic rent in the wholesale electricity market is the market pric= e=20 of electricity minus the producer's cost where cost includes not just labo= r=20 and fuel but a fair profit on the invested capital as well. In traditiona= l=20 regulation this fair profit is calculated very simply as the market cost o= f=20 the money borrowed to build the power plant.=20 ?????Under this definition if the producer's cost is a nickel a kilowatt= =20 hour and he can sell it for 35 cents--as producers in the West have been=20 doing--the producer can extract 30 cents of economic rent from consumers.= =20 ?????In California the extraction of such economic rent through market=20 manipulation has taken place on a grand-theft scale. In 1999 California's= =20 electricity bill was about $7 billion. Last year it was almost $30 billion= =20 for roughly the same amount of electricity. This year California's bill is= =20 well on its way to $50 billion annually.=20 ?????To stop this rip-off Gov. Gray Davis proposed cost-based price caps= .=20 Such caps are calculated on a plant-specific basis. Each generator is allow= ed=20 to recover its cost of production including the fair profit but not a pen= ny=20 more.=20 ?????Thus for example a newer highly efficient plant generating power at= a=20 nickel per kilowatt hour would collect a nickel. The oldest least efficien= t=20 plant that generated power for 20 cents would be allowed to collect 20 cent= s.=20 ?????By setting different prices for different plants the economic rents a= re=20 driven to zero. Yet each generator still has a fair profit incentive to=20 produce. From a public policy perspective it's the best of all possible=20 worlds. And it was categorically rejected by the FERC. Instead the FERC se= ts=20 a single price for all generators based on the cost of the least efficient= =20 plant.=20 ?????The obvious problem with this umbrella pricing rule is that it still= =20 allows generators to extract billions in economic rent from consumers.=20 ?????In our previous example and under the FERC's rule the least efficien= t=20 plant still collects 20 cents a unit to recover costs. However the most=20 efficient plant producing power at a nickel-per-kilowatt also collects 20= =20 cents rather than a nickel and thus extracts a full 15 cents of economic=20 rent.=20 ?????Thus under the FERC's rule wholesale generators still will be able t= o=20 capture tens of billions of dollars more from consumers and businesses than= =20 under Davis' cost-based rule.=20 ?????The FERC's approach is still subject to the same kind of strategic=20 gaming that has been the hallmark of this crisis. Generators will ensure th= at=20 during peak times when the price cap is being established the most=20 expensive possible plant is in operation--whether it needs to be or not. Th= is=20 will peg the price at the highest level.=20 ?????In addition the FERC provides generators with a perverse incentive to= =20 run their least efficient units more often. Since these least efficient=20 plants are also the highest polluting the result will be dirtier air.=20 Moreover the excessive running of these plants may also put a strain on=20 already stretched natural gas supplies. These least efficient plants use up= =20 to 40% more natural gas to produce a unit of electricity.=20 ?????The bottom line: The FERC done good. But it could have done a lot=20 better. And the way things stand now there still is a danger that higher= =20 electricity costs could push California and the rest of the West--and=20 eventually the nation--into a nasty recession.=20 - - - Peter Navarro Is an Associate Professor of Economics and Public Policy at U= c=20 Irvine. E-mail: Pnavarro@uci.edu Copyright 2001 Los Angeles Times=20 Davis OKs stopgap loan=20 CRISIS POWERS: Action sidesteps Legislature=20 Greg Lucas Sacramento Bureau Chief Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 Circumventing the Legislature Gov. Gray Davis used his emergency powers=20 yesterday to authorize borrowing up to $5 billion for energy purchases in= =20 advance of a record bond issue.=20 Sidestepping the Legislature with a stroke of the pen Davis' action=20 indicates that the state may need more time to prepare a $12.5 billion bond= =20 issue this fall the largest sale of its kind in history.=20 The Democratic governor's action was swiftly assailed by the Republican=20 leadership.=20 This is not a dictatorship. It's a democracy said Assembly GOP leader Da= ve=20 Cox of Carmichael. There is a judiciary a legislative side and an executi= ve=20 side and everyone has roles and responsibilities. Yet we continue to have= =20 the governor say 'I'm the only one around here that makes any difference.= =20 The rest of you shall do my bidding.' =20 Normally it is the Legislature that has the power to raise and spend money= =20 and a governor may not spend a cent unless lawmakers allow him to.=20 But Davis has broad powers under the state of emergency which he declared = in=20 January to combat California's energy crisis.=20 NO ADVANCE NOTICE The governor's aides declined to comment on yesterday's executive order and= =20 gave no advance notice of it.=20 This executive order authorizing a bridge loan will allow us to get=20 California's General Fund out of the power-buying business was the=20 governor's only comment in a written statement issued last night.=20 State Treasurer Phil Angelides said lawyers had advised him and the governo= r=20 that such borrowing could be authorized by an executive order.=20 The loan from Wall Street will temporarily fill the $5.2 billion -- and=20 growing -- hole in the state budget created when the state began buying=20 electricity on behalf of the state's cash-starved utilities in January.=20 The idea is to tide the state over until a larger bond sale of $12.5 billio= n=20 can be arranged later this year. A portion of that sale will pay back the= =20 $5.2 billion borrowed from Wall Street.=20 'STOPS THE BLEEDING'=20 It stops the general fund bleeding said Angelides. It takes the pressur= e=20 off and hopefully we'll avert a cash crisis.=20 The state runs out of internal borrowing power sometime in October. Angelid= es=20 said the loan would buy the state another four to six months.=20 The idea of a loan was floated earlier this year.=20 Cox and other GOP lawmakers objected wondering why the state should pay=20 interest on borrowed money when it could still borrow from various accounts= =20 within the state budget.=20 They refused to vote for a bill authorizing the larger bond sale of $12.5= =20 billion forcing a delay in issuing it until at least Aug. 14.=20 The idea of borrowing from Wall Street appears to have been abandoned sinc= e=20 both Davis administration and legislative budget-writers said the state cou= ld=20 keep borrowing internally into October well after the bond sale.=20 Yesterday's executive order authorizing the borrowing suggests that neither= =20 Angelides nor Davis are confident that the steps needed to prepare the $12.= 5=20 billion bond issue for market can be completed before then.=20 Angelides had previously said he hoped to sell the bonds in early September= .=20 Yesterday he said the governor's hope is to still sell long-term bonds by= =20 Sept. 30.=20 ACT OF DESPERATION? Sen. Tom McClintock R-Northridge described the executive order as an act = of=20 desperation that would suggest they are expecting the large bond sale to= =20 occur later rather than sooner.'=20 Numerous actions must be completed before the bond sale.=20 Among them are the approval by the Public Utilities Commission of several= =20 deals with the state and utilities to ensure that enough money from=20 consumers flows back to bond buyers to pay off interest and principal.=20 Although Davis' executive order authorizes $5 billion in loans Angelides h= as=20 only lined up $3.5 billion.=20 So far only two lenders have come forward to offer the state a loan J.P= =20 Morgan with $2.5 billion and Lehman Brothers with $1 billion at an interes= t=20 rate of 4.5 percent. If the long-term bonds are not sold by Oct. 31 that= =20 will increase to 7 percent.=20 Angelides said he hoped to line up another $1 billion by next week when th= e=20 loan deal occurs.=20 Assuming a loan of $4.5 billion Angelides said the state would pay out $8= =20 million in fees.=20 E-mail Greg Lucas at glucas@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 Experts say state must seize the day=20 ANALYSIS: Price caps set stage for future=20 David Lazarus Chronicle Staff Writer Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL: DTL=20 One day after federal authorities ordered long-sought electricity price cap= s=20 throughout the West analysts said yesterday it is up to California to=20 respond with measures to bring an end to the state's long frustrating=20 experiment with deregulation.=20 Possible steps the experts point to include raising power bills easing=20 pollution controls and spending billions of dollars in taxpayers' money on= =20 new plants.=20 Gov. (Gray) Davis and his team have been making this up week by week sai= d=20 Paul Joskow director of the Center for Energy and Environmental Policy=20 Research at the Massachusetts Institute of Technology.=20 It's time for them to get together with the Federal Energy Regulatory=20 Commission (FERC) to come up with some solutions he said. The state need= s=20 to get down to business and decide how the power market is going to look 18= =20 months from now.=20 Easier said than done. To date California's strategy for tackling its ener= gy=20 woes largely has consisted of wheedling cajoling and all but begging feder= al=20 officials to come to the rescue.=20 Now that the federal regulators have gone much of the way toward granting t= he=20 state's wishes analysts said Davis and other officials must act swiftly an= d=20 decisively to further remedy California's prolonged power troubles.=20 For his part however the governor feels that federal regulators have not= =20 done enough. He will push today during congressional hearings in Washington= =20 for billions of dollars in refunds for California ratepayers.=20 FERC has taken some first steps but the proverbial fat lady hasn't sung= =20 said Steve Maviglio a spokesman for Davis.=20 This persistent focus on federal assistance could slow progress toward a=20 lasting solution to California's problems some analysts believe.=20 We are still likely to experience blackouts this summer said Michael=20 Zenker director of Cambridge Energy Research Associates in Oakland. It's= =20 not yet clear that the state will do what it can to address other aspects o= f=20 the problem.=20 Put simply such steps would require enormous political courage -- and woul= d=20 be very expensive. In the end taxpayers and ratepayers will bear the burde= n=20 for this prolonged fiasco.=20 Among measures under consideration:=20 -- Raising electricity rates even higher. Although Californians got the=20 largest rate increase in state history last month even higher charges woul= d=20 promote conservation and lessen the need for California to borrow billions = of=20 dollars in the bond market.=20 -- Loosening emissions restrictions for power plants statewide. This would= =20 provide more electricity during shortages but turn back the clock on=20 California's strict environmental standards.=20 -- Building new plants at taxpayers' expense. This would guarantee a steady= =20 supply of juice but would leave the state struggling for years to recoup th= e=20 huge investment costs.=20 Of the three easing pollution controls is the easiest first step and the= =20 most likely analysts said. Such environmental protections have been roundl= y=20 criticized by power industry officials who claim the restrictions have=20 hampered the construction of new generating plants.=20 Taxpayer-financed power plants are possible under a new state power authori= ty=20 backed by the governor but the timing and financing remain undecided.=20 Higher electricity rates could be the toughest move to make analysts agree= .=20 They note that Davis will seek re-election next year and doesn't want to be= =20 seen as the governor who sent voters' power bills into the stratosphere.=20 Already critics are trying to paint him as the governor who was asleep at= =20 the power switch.=20 As federal regulators were moving at last on the price-cap front this week= =20 another big development took place closer to home Monday when Davis disclos= ed=20 a tentative deal with Sempra Energy's San Diego Gas & Electric Co. The plan= =20 calls for the state to purchase the utility's 1800 miles of power lines fo= r=20 nearly $1 billion.=20 As with a similar accord reached with Southern California Edison the Sempr= a=20 deal is intended to counter the catastrophic effects of California having= =20 deregulated wholesale power prices but not allowing the state's utilities t= o=20 pass on costs to customers.=20 Between them California's three major utilities have rung up more than $15= =20 billion in debt.=20 Here too the state appears unsure how to proceed. Both the Sempra and=20 Edison agreements require approval from the Legislature. It's anyone's gues= s=20 whether such approval is forthcoming.=20 It's going to be a really really tough sell said Nettie Hoge executive= =20 director of The Utility Reform Network in San Francisco. These aren't=20 fabulous deals.=20 ONE SCENARIO FOR UTILITIES Rather she believes the agreements will be reworked so that less taxpayer= =20 money changes hands while allowing the utilities to retain possession of=20 their power systems.=20 Hoge said this could subsequently influence a speedy resolution of Pacific= =20 Gas and Electric Co.'s bankruptcy proceedings. If it can avoid selling off= =20 key assets like power lines PG&E may be more open to any settlement plans= =20 put forward by the state.=20 The utilities are all going to end up with similar deals Hoge forecast.= =20 State Senate President Pro Tem John Burton D-San Francisco isn't so sure.= =20 He observed that the Edison deal hinges on a sale of the utility's power=20 lines to the state while the Sempra accord could stand even without such a= =20 transaction.=20 The two deals are totally unrelated Burton said adding that approval of= =20 the Edison accord is very much in flux. A bankruptcy filing by the state'= s=20 second-largest utility remains a distinct possibility he said.=20 This would only increase the importance of price caps in bringing some=20 stability back to California's power market.=20 While the state's current rate freeze will continue cushioning consumers fr= om=20 the volatility of wholesale electricity prices the caps -- or price=20 mitigation as federal regulators are calling it -- will limit the amount= =20 that power generators can charge on the open market.=20 SYSTEM HAS FLAWS It is not a perfect system: Power companies can base prices on the cost of= =20 running the least-efficient -- and thus costliest -- generating facility. B= ut=20 this amount almost certainly will be below some of the more outrageous pric= es=20 seen when the sky was the limit.=20 On at least one occasion this year California's wholesale power price topp= ed=20 $3000 per megawatt hour compared with just $30 about a year ago.=20 This is a plan that is good for California good for the Pacific Northwest= =20 and good for the entire West said FERC Chairman Curt Hebert.=20 That remains to be seen. As it stands the price caps will remain in effect= =20 through next summer.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 California's energy crisis hits Northwest like a tidal wave=20 Jeff Hammarlund Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/E D165509.DTL=20 THERE WAS a time when many Northwesterners thought we could watch=20 California's energy crisis from a safe distance.=20 We have since learned that a major energy crisis does not stop at the Golde= n=20 State's borders but instead rolls over the Northwest like a tidal wave= =20 wreaking havoc with our economy and overwhelming our carefully crafted ener= gy=20 policies.=20 As one Northwest utility official put it We learned that everyone else is= =20 the tail. California is the dog.=20 To understand why the Northwest is now facing its own energy crisis and how= =20 the energy problems in the Northwest and California each affect each other= =20 one must understand how the Northwest gets its power.=20 In the Northwest falling water is our primary fuel. Depending on the=20 available snowpack hydroelectricity produced at more than 200 dams in the= =20 Columbia River basin generates between 60 and 75 percent of the region's=20 electricity. About two-thirds of this hydropower comes from 29 dams owned a= nd=20 operated by the two federal agencies the U.S. Army Corps of Engineers and= =20 the Bureau of Reclamation.=20 By taking advantage of the region's geography and climate the Columbia's= =20 hydroelectric dams have produced some of the least expensive electricity in= =20 the nation power that has been the economic backbone of the region.=20 However the Columbia's hydrosystem also has two curses.=20 One is that water conditions can vary greatly and right now the Northwest= =20 and California are in the middle of an extreme drought. The second is the= =20 dams' negative impact on salmon. These dams operate under a federal salmon= =20 recovery plan established under the Endangered Species Act that calls for= =20 more water to be sent over spillways to help push the salmon downstream=20 instead of through the dams' power-generating turbines.=20 That power is sold at cost and transmitted to Northwest consumer-owned=20 utilities by yet another federal agency called the Bonneville Power=20 Administration. These cost-based rates cover the expense of repaying the= =20 U.S.=20 Treasury for the cost of developing these hydropower projects moving the= =20 power over massive transmission lines and supporting efforts to restore th= e=20 dwindling salmon runs.=20 Under federal law Northwest consumers get preferred access to the relative= ly=20 low-cost power. Any surplus power can be sold most often to California's= =20 municipal and investor-owned utilities.=20 This Northwest regional preference to federal power was part of the deal= =20 that led to the construction of the massive transmission lines called the= =20 intertie which first connected the Northwest with California and the=20 Southwest in the late 1960s.=20 For decades the intertie worked almost flawlessly and to everyone's benefi= t.=20 During the summer when air conditioners caused California's power use to= =20 peak many California utilities would supplement their needs by turning to= =20 the Northwest. In the winter when Northwest electric furnaces are turned o= n=20 for space heating California utilities would return the favor and ship the= ir=20 surplus power north.=20 Recently the BPA has had to purchase large blocs of power on the wholesale= =20 market to meet its contractual obligations to its Northwest customers.=20 The same exorbitant wholesale prices that began to plague California last= =20 year have also affected the Northwest meaning that the BPA has been runnin= g=20 out of money and is now in danger of defaulting on its debt obligations to= =20 the Treasury.=20 California's deregulation plan has affected energy relations between the tw= o=20 regions in other ways. For example the BPA has historically sold surplus= =20 power to California for relatively low prices. However the state's=20 deregulation law made it almost impossible for California utilities to ente= r=20 into favorable long-term contracts.=20 Instead power had to be purchased at the much higher market clearing pric= e=20 on the short-term spot market.=20 The BPA has taken extraordinary steps to help California keep the lights on= .=20 At times the agency even declared energy emergencies which allowed it to= =20 temporarily override salmon protections and use the water to generate power= =20 for California rather than sweep salmon over the dams. California officials= =20 have praised the BPA for its cooperation but Northwest environmentalists a= nd=20 tribal leaders complain that the BPA has been helping California address it= s=20 energy crisis by selling salmon down the river.=20 The Northwest will be helped by FERC's decision yesterday to extend limited= =20 temporary price restrictions it had imposed in California in the spring to= =20 other Western states during severe shortages. The order should also be good= =20 for California. Without consistent price restrictions throughout the West= =20 power marketers would simply skip California during an emergency and sell a= t=20 higher prices elsewhere.=20 But not everyone is happy with the decision. Many critics say the rates are= =20 still too high and some critics said in s published report that the order= =20 rewards inefficiency by pegging price ceilings to the costliest California= =20 gas plants.=20 The half-hearted response from FERC along with continuing supply shortages= =20 and other problems make it likely that California will continue to face=20 rolling blackouts and high utility bills -- even though they may not be as= =20 high as we once feared.=20 The Northwest may follow suit next winter.=20 Some in our region fear that some desperate California political leaders=20 might try to wrest control of the BPA and a large portion of the Columbia= =20 Basin's hydropower. The 6600 megawatts of hydropower from the Columbia's= =20 federal dams would only offer a few drops in the bucket for California's=20 massive 50000-megawatt system but its loss would devastate the Northwest= =20 economy.=20 The four Northwest governors (of Washington Oregon Idaho and Montana) and= =20 more than 40 state legislators met in February and agreed to explore ways t= o=20 ensure that the Northwest does not lose its regional preference to the=20 Columbia's hydropower.=20 Northwest governors have had some productive meetings with Gov. Gray Davis= =20 and his staff this year regarding power sharing and there are encouraging= =20 signs that trust is growing at this and other levels.=20 Just last week officials from the BPA California's Department of Water=20 Resources and the California ISO agreed on a plan that outlines when and h= ow=20 the BPA may be able to help California during the expected summer shortages= .=20 We will soon find out whether our two regions will succeed in collaborating= =20 with or cannibalizing each other as we enter the next phase of the West Coa= st=20 energy crisis.=20 Ultimately California's experience with energy deregulation makes the case= =20 for a strong and supportive federal role in the energy markets. It also=20 reinforces the view that electricity should be treated as an essential=20 service and be sold at cost by utilities that are owned and controlled by t= he=20 public rather than as a commodity and sold at the highest price.=20 In fact something like a California power authority that places California= =20 in charge of its own destiny makes more sense to me all the time.=20 Jeff Hammarlund is an adjunct associate professor and research fellow at th= e=20 Mark Hatfield School of Government at Portland State University where he=20 teaches graduate courses on energy policy. He is also president of Northwes= t=20 Energy and Environmental Str=20 2001 San Francisco Chronicle ? Page?A - 19=20 Davis demands nearly $9 billion for electricity overcharges=20 H. JOSEF HEBERT Associated Press Writer Wednesday June 20 2001=20 2001 Associated Press=20 URL:=20 ation al1103EDT0569.DTL=20 (06-20) 08:03 PDT WASHINGTON (AP) --=20 California Gov. Gray Davis demanded that power generators refund nearly $9= =20 billion in electricity overcharges and complained that federal regulators= =20 have looked the other way while energy companies bilked our state.=20 Davis told a Senate hearing Wednesday that the decision by the Federal Ener= gy=20 Regulatory Commission to curtail price spikes in California and 10 other=20 Western states was a step forward. But its actions do nothing about the=20 overcharges over the past year he said.=20 The governor a Democrat has been criticized by Republicans who charge he= =20 has allowed the California power crisis to get out of hand.=20 Davis defended his actions saying the state has stepped up approval for ne= w=20 power plants and strengthened conservation programs. He also said the state= =20 has little control over price gouging by out-of-state power generators.=20 The governor once said he could solve California's problems in 15 minutes.= =20 ... But it appears that California has continued to try and hide the true= =20 cost of power by having the state pay for it instead of the utilities=20 putting California taxpayers in jeopardy said Sen. Frank Murkowski=20 R-Alaska.=20 Murkowski said many of the alleged overcharges are by public power entities= =20 not under FERC jurisdiction=20 Sen. Joe Lieberman D-Conn. chairman of the Governmental Affairs Committee= =20 said the FERC which regulates wholesale electricity sales has been slow t= o=20 respond and surprisingly reluctant to assure that electricity prices are= =20 just and reasonable as required by the 1934 Federal Power Act.=20 The agency's response to the Western power problem raises serious question= s=20 about whether (FERC) has or will oversee the newly deregulated energy=20 markets not only in the West but across the rest of the country.=20 The federal agency whose commissioners were to testify later in the day= =20 imposed limited market-based price caps on Monday in California and 10 oth= er=20 Western states from Washington to Arizona. The agency also ordered the=20 parties to attend a conference next week to try to work out agreements on= =20 overcharges and other issues.=20 Months ago the FERC singled out $124 million in alleged overcharges by pow= er=20 generators. The power companies have since challenged the agency's findings= =20 and the matter remains in dispute.=20 To date not a single penny in refunds has been returned to California=20 complained Davis. He said that between May 2000 and the beginning of this= =20 month power generators are believed to have overcharged California $8.9=20 billion.=20 They must be required to give us back our money said Davis. It is=20 unconscionable that FERC looked the other way while energy companies bilked= =20 our state for up to $9 billion.=20 The state spent $7 billion for electricity in 1999 and $27 billion in 2000= =20 and is projected to pay nearly $50 billion this year said Davis. Power=20 generators have been able to exert extreme power over our energy market h= e=20 said.=20 Davis rejected Republican criticism that the state is not addressing the=20 problem. He said newly approved power plants will provide 20000 additional= =20 megawatts of electricity by 2003 including 4000 megawatts by the end of= =20 this summer. Everything that can be done to bring reliable affordable=20 energy to California is being done ... except wholesale price relief he= =20 said.=20 This administration has minimized this crisis (for) more months said Sen= .=20 Patty Murray D-Wash. alluding to President Bush's repeated refusal to urg= e=20 the FERC to mitigate electricity prices. Bush has strongly opposed price=20 controls although he indicated support for FERC's limited price mitigation= =20 effort this week.=20 Murray said the government should issue a disaster declaration so that=20 businesses can get low-income loans and require that FERC press its=20 investigation into price gouging and demand refunds not only in California= =20 but in the Pacific Northwest where electricity prices have also skyrockete= d.=20 Republicans continued their opposition to more stringent price caps based o= n=20 the cost of generation at individual power plants.=20 Having a federal agency try to determine what is a just and reasonable pri= ce=20 is laughable said Sen. Fred Thompson of Tennessee the committee's rankin= g=20 Republican. Hard price caps don't work when supply is the problem. ... The= y=20 make a bad situation worse he said.=20 After FERC issued its limited price control order this week Senate Democra= ts=20 on Tuesday said they would drop legislation to require more stringent=20 cost-based price caps on Western electricity sales.=20 Democrats in the House however said they would continue to pursue a bill= =20 requiring the FERC to take more aggressive action.=20 2001 Associated Press ?=20 Fed price caps placate Demos=20 But Feinstein's bill to regulate energy producers was more strict=20 Carolyn Lochhead Chronicle Washington Bureau Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/M N145950.DTL=20 Washington -- With federal regulators moving to cap prices on wholesale=20 electricity California's Dianne Feinstein and other Senate Democrats=20 yesterday withdrew their threat to do it for them.=20 A rose is a rose by any other name Feinstein declared to the five member= s=20 of the Federal Energy Regulatory Commission the day after they unanimously= =20 imposed a sweeping price ceiling on electricity throughout eleven western= =20 states.=20 I'm very grateful Feinstein told the commissioners who were called to= =20 testify to the Senate Energy and Natural Resources Committee. Let's watch= =20 and wait and see how this order works.=20 Feinstein had been leading the Democratic charge in Washington to force FER= C=20 to impose price controls indeed yesterday's hearing had been intended to= =20 highlight the agency's inaction. Gov. Gray Davis is still billed to appear= =20 today at another Senate panel headed by Sen. Joe Lieberman D-Conn. to=20 investigate price gouging.=20 The 60-page FERC order which takes effect at midnight tonight and remains= =20 until September 2002 limits prices based on the cost of the least-efficien= t=20 and therefore highest-cost generating plant. It is intended to mimic the w= ay=20 a competitive market functions.=20 While Democrats hailed FERC's move power generators and marketers warned= =20 that it would backfire leading to more blackouts and stifling investment i= n=20 new power plants.=20 It doesn't create or conserve a single megawatt in California or the West= =20 said Enron spokesman Mark Palmer. Government price controls always have=20 unintended consequences and history has proven that those have never been= =20 good for consumers.=20 Joe Bob Perkins president and chief operating officer of Reliant Energy= =20 bluntly called the price caps a political response to California's crisis= =20 that ignores the basics of supply and demand.=20 Price caps don't work Perkins said in a statement. This fact has been= =20 proven over and over in the context of virtually every business sector in= =20 which government regulators have experimented with such measures.=20 The Bush administration which has fought electricity price caps since taki= ng=20 office in January yesterday insisted that FERC had actually spurned them.= =20 It's important to note that FERC rejected price controls said White Hous= e=20 spokesman Ari Fleischer who instead called it a market-based mitigation= =20 plan.=20 He added the order is in keeping with the president's desire to help the= =20 state of California and to make certain that there is no illegal price=20 gouging carried on by any companies.=20 FERC's action coincided with the arrival of two new Bush appointees to the= =20 agency Patrick Henry Wood III a former Texas utility regulator and Nora= =20 Mead Brownell a former Pennsylvania regulator.=20 The soft-spoken boyish-looking Wood yesterday sought to allay Feinstein's= =20 lingering concerns that the new price control scheme would still permit=20 generators to manipulate the market.=20 Feinstein's bill would have gone further than the new FERC plan imposing a= =20 cost-of-service based price cap that would return California to the=20 regulatory regime it had before its 1996 electricity restructuring.=20 I am personally not allergic to that sort of remedy Wood told the panel = -=20 - a position that is toxic to the Bush administration's former opposition t= o=20 price caps. The cost-of-service regime was good enough for 80 years Wood= =20 said. We're trying to move away from it but we can still do it.=20 FERC's action followed by Feinstein's bill withdrawal quickly defused a= =20 mounting political confrontation between the Bush White House and Democrats= =20 over price caps -- one that saw Capitol Hill Republicans beating a retreat.= =20 Democrats argued that Bush by refusing to impose price controls was=20 allowing out-of-state generators based mostly in Texas to gouge California= =20 consumers.=20 The administration especially Vice President Dick Cheney and Energy=20 Secretary Spencer Abraham had insisted that price controls would backfire = by=20 reducing electricity sales and power plant investment making the state's= =20 blackouts worse.=20 Yesterday Sen. Gordon Smith an Oregon Republican who co-sponsored=20 Feinstein's bill as much as said the White House would have lost the fight= .=20 Smith said their measure would have won large majorities in both the Senat= e=20 and House had it gone to a vote.=20 E-mail Carolyn Lochhead at clochhead@sfchronicle.com=20 2001 San Francisco Chronicle ? Page?A - 11=20 Potrero Hill power plant hit by 2 lawsuits=20 Neighbors city ask court to cut back hours of operation=20 Rachel Gordon Chronicle Staff Writer Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/M N238116.DTL=20 The San Francisco city attorney joined forces with environmental and=20 community groups and sued in federal court yesterday to force the operator = of=20 the Potrero Hill power plant to cut its ramped-up electricity output until= =20 more rigorous pollution controls are installed.=20 The plant run by Mirant Corp. increased its output in response to Gov. Gr= ay=20 Davis' move to relax environmental laws on power producers and generate mor= e=20 electricity for Californians.=20 The lawsuits filed against Mirant in U.S. District Court allege the compa= ny=20 is illegally operating its so-called peaker plants. The suits appear to be= =20 the first challenge in California to Davis' efforts to produce more power.= =20 The Potrero Hill plant which runs during times of peak demand has a total= =20 of six turbines that generate 156 megawatts of electricity enough to power= =20 156000 homes. Each turbine is permitted to operate 877 hours a year -- a= =20 threshold that already has been exceeded.=20 Mirant struck a deal March 30 with administrators of the Bay Area Air Quali= ty=20 Management District -- the regional agency that regulates air pollution -- = to=20 run the plants as much as needed to keep up with the energy demand. In=20 return Mirant will pay $20000 per ton of excess emissions of nitrogen=20 oxides a pollutant that causes smog. The company placed $400000 on deposi= t.=20 The Mirant Corporation is behaving like an outlaw and the air district is= =20 their willing accomplice in violating clean air laws said Mike Thomas an= =20 organizer with Communities for a Better Environment one of the plaintiffs.= =20 The other groups that sued are Bayview-Hunters Point Community Advocates an= d=20 Our Children's Earth.=20 The city filed a separate suit over the same issue.=20 The lawsuits ask the court to order Mirant to stop operating beyond the 877= -=20 hour cap until it obtains new permits. The city and environmental groups=20 argue the permits for expanded operation are required by the federal Clean= =20 Air Act.=20 The lawsuits also demand that more stringent pollution controls be installe= d=20 on the peakers. The increased power production poses a potentially serious= =20 health risk to the people who live and work in the surrounding neighborhood= =20 the plaintiffs charge.=20 Because the peaker plants weren't originally intended to run full time the= y=20 aren't equipped with the most up-to-date pollution controls.=20 The plaintiffs also allege the air district regulators violated the=20 California Environmental Quality Act by failing to conduct thorough reviews= =20 of the expanded operation and not allowing for public comment.=20 We as a city are not saying no to power. We're saying there's a process an= d=20 they need to follow it said San Francisco Supervisor Sophie Maxwell who= =20 represents District 10 where the power plant is located.=20 Terry Lee a spokesman for the air district said her agency and Mirant did= =20 nothing illegal. Mirant spokesman Patrick Dorinson concurred.=20 They pointed to Davis' executive orders earlier this year that gave power= =20 companies the right to step up production without going through the normal= =20 permit process and adhering to the stricter pollution controls.=20 William Rostov an attorney for Communities for a Better Environment=20 contends Davis does not have authority to override federal air quality laws= .=20 Lee said the U.S. Environmental Protection Agency signed off on the=20 governor's plan.=20 The plant near 23rd and Illinois streets long has been a target of=20 neighbors trying to close it. Mirant is hoping to build a new 540-megawatt= =20 plant on the site that uses cleaner-burning natural gas. The existing plant= =20 burns highly polluting distillate oil.=20 Lee said the money Mirant is paying for the extra emissions will help reduc= e=20 air pollution in Potrero Hill. The efforts include placing filters on Muni= =20 diesel fuel buses that operate in the neighborhood and installing a lower-= =20 polluting engine on a tug boat that runs off the nearby shores.=20 Is this a perfect situation? No Lee said. But under the governor's=20 executive orders this is the way we're proceeding.=20 E-mail Rachel Gordon at rgordon@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 13=20 Washington wakes up=20 Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/E D40132.DTL=20 WASHINGTON after all does feel our pain. Partial but reasonable price=20 controls will contain wholesale electricity prices beginning today under a= =20 long-sought ruling by the Federal Energy Regulatory Commission. It's about= =20 time.=20 Where was this agency until now and why the sudden willingness to help?=20 Politics.=20 At first the Bush administration denounced controls as market interference= =20 that would chase off investment in power generation.=20 But the peril has spread beyond California to other Western states whose= =20 governors are Republicans. Mid-term elections for Congress are coming up ne= xt=20 year. Also the White House was besieged by California Republicans and=20 business groups worried about blackouts and price gouging.=20 President Bush finally sounded the retreat the day before the commission=20 vote. He could accept a mechanism that would mitigate any severe price= =20 spike. He insisted that the final results were not firm price controls=20 which arguably they are not.=20 Gov. Gray Davis who begged for help for months said the final package=20 didn't go far enough. What he wanted were tougher limits pegged to generati= on=20 costs plus a profit figure of 30 to 50 percent.=20 The final formula approved by the commission amounts to a loose-fit limit= =20 that should dampen the absurd price surges that have endangered the state.= =20 The 24/7 plan rewards modern plants by setting prices based on the=20 least-efficient power producers. It covers 11 states not just sickly=20 California.=20 There is room for doubt. Canny operators may find ways to exploit the prici= ng=20 mechanism. Also California will be whacked with a one-state-only surcharge= =20 of 10 percent. The commission took no action on another Davis complaint tha= t=20 power generators may have overcharged the state by $6.2 billion.=20 Still the new limits may be the most anyone could expect. Consider how far= =20 Washington has come: A hidebound ideology has given way to real-world=20 recognition of a huge problem. U.S. Sen. Dianne Feinstein acknowledged as= =20 much yesterday when she dropped a measure to impose stricter price limits.= =20 California's troubles aren't over. Conservation remains supremely important= .=20 New power plants need approval and speedy construction. The financial damag= e=20 to state utilities and the state's coffers needs attention. The severity of= =20 summer blackouts is a wild card.=20 The federal controls add a measure of protection from this volatile mix. It= 's=20 a shame that help didn't come sooner.=20 2001 San Francisco Chronicle ? Page?A - 18=20 Feinstein halts electricity price caps bill=20 Posted at 12:15 a.m. PDT Wednesday June 20 2001=20 BY JIM PUZZANGHERA=20 Mercury News=20 WASHINGTON -- Like a steam valve on an overheating boiler the move by=20 federal regulators to enact broad new electricity price controls in the Wes= t=20 has relieved much of the growing political pressure for stronger action --= =20 for now.=20 Sen. Dianne Feinstein removed one major source of that pressure Tuesday.=20 Satisfied that the Federal Energy Regulatory Commission has taken ``a giant= =20 step forward'' in curbing California energy prices Feinstein withdrew her= =20 legislation to enact price caps on wholesale electricity prices throughout= =20 the West.=20 ``Let's watch and wait and see how this order works'' the California=20 Democrat told members of the commission during a Senate hearing.=20 But while the battle over the actions of federal regulators may have=20 subsided the larger political war over energy prices continues.=20 California Gov. Gray Davis who has been pounding away for weeks at the Bus= h=20 administration for not providing enough help to the state will step into t= he=20 fray here today. The governor will appear at a Senate hearing where he will= =20 praise federal regulators for moving in the right direction with the new=20 plan. But he's also expected to continue to press for harder price caps and= =20 criticize federal regulators for taking months to act while the state drain= ed=20 billions from its budget to pay for electricity.=20 In addition Davis will question some aspects of the plan such as the lack= =20 of strong action on forcing refunds from suppliers. ``He wants to make sure= =20 that Congress gets the message loud and clear that we want our money back= =20 from the overcharges by generators'' said Davis media representative Steve= =20 Maviglio.=20 But the Republicans are just as eager to lay responsibility for the=20 electricity crisis on Davis who is up for re-election next year. A=20 hard-hitting Republican-backed TV ad campaign in California organized by=20 Scott Reed a former executive director of the Republican National Committe= e=20 blames the governor for failing to act quickly when the crisis first emerge= d.=20 The politics of shifting blame are likely to set the tone for the hearings= =20 organized by the new Democratic chair of the Senate Governmental Affairs=20 Committee Sen. Joe Lieberman D-Conn. Davis and all five FERC commissioner= s=20 have been invited to the hearing to determine if the commission has lived u= p=20 to its legal obligation to ensure ``just and reasonable'' electricity price= s=20 in California.=20 Price controls=20 With that oversight hearing pending this week the commission called a=20 special meeting Monday and took stronger action. It expanded existing=20 electricity price controls around the clock and to 11 Western states. Under= =20 the commission's plan ceiling prices will be set that suppliers can exceed= =20 as long as they provide justification for the higher price. A hard price ca= p=20 would set a price that could not be exceeded.=20 Commission Chairman Curt Hbert a Republican said politics played no role= =20 in enacting the new plan. But Commissioner William Massey one of two=20 Democrats on the five-member commission acknowledged that political pressu= re=20 in recent weeks from Republicans and newly empowered Democrats in the Senat= e=20 had an impact.=20 ``We are an independent agency but we operate in a highly charged political= =20 environment. I would not imply that we did not rule on an independent basis= =20 here but you know this is Washington D.C. for God's sake'' Massey told= =20 the Mercury News on Tuesday. ``I think that it was enlightening to the agen= cy=20 that this wasn't just a Democratic question this was Democrats and=20 Republicans throughout the West saying `My God solve this problem.' And s= o=20 we hope we have.''=20 The White House which had opposed any form of price controls also moved t= o=20 adjust to this political reality.=20 ``To the degree that it is a market-based program this is in keeping with= =20 what the president said and the president is pleased to be able to help=20 California in that manner'' White House press secretary Ari Fleischer said= .=20 ``It does not change the president's fundamental view that a separate=20 economic matter which would be price controls would not be productive.''= =20 But Democrats are eager to point to the shift as evidence that the White=20 House realized it was paying too high a political price for its earlier=20 position insisting that the electricity crisis was largely California's=20 problem to solve.=20 ``The Bush administration is realizing the jig is up. The game is over''= =20 said Sen. Barbara Boxer D-Calif. ``Their attitude of hands-off has hurt th= em=20 deeply.''=20 Democrats in the House have vowed to continue pushing for a vote on their o= wn=20 price-caps bill. The legislation is adamantly opposed by Republican leaders= =20 in Congress who believe FERC's actions Monday are enough government=20 intervention.=20 ``I hope that its actions are based on market principles not political=20 half-measures'' said House Majority Whip Tom DeLay R-Texas. ``It's now ti= me=20 for Governor Davis to stop pointing fingers and shifting blame.''=20 Feinstein has vowed to quickly resurrect her bill if electricity prices sho= ot=20 up dramatically. Boxer said she will introduce legislation to force FERC to= =20 order power suppliers to refund what the state says are billions of dollars= =20 in overcharges for electricity purchases.=20 Meeting on refunds=20 The commission has set up a conference for the state suppliers and utiliti= es=20 to settle the contentious refund issue by July 10. If no settlement can be= =20 reached under the auspices of an administrative law judge the judge will= =20 make a recommendation to the commission and it will resolve the dispute=20 Hbert said.=20 Massey had supported Feinstein's legislation to force him and his fellow=20 commissioners to enact price caps. But after the commission unanimously=20 approved its expanded price-control plan he joined the four other=20 commissioners Tuesday in urging the Senate Energy and Natural Resources=20 Committee not to pass such a law.=20 The commission's chair Hbert strongly warned against legislative action= =20 saying ``I believe in my heart and I know in my educated mind that we ar= e=20 on the right track.''=20 But the issue disappeared Tuesday as Feinstein and the Republican co-sponso= r=20 of the price-cap legislation tabled their plan.=20 ``I think it renders substantially moot the legislative efforts that she an= d=20 I were pursuing'' Sen. Gordon Smith R-Ore. said of the commission's new= =20 price-control plan. ``And I do believe that effort would have won large=20 majorities in the Senate and the House and so I think what you are doing i= s=20 reflecting the will of the elected representatives of the American people.'= '=20 Feinstein said that whatever the commission calls the plan it is close=20 enough to hard caps to merit a chance to work.=20 ``I view this action by FERC as a giant step forward and I'm very grateful = to=20 you'' she told the commissioners. ``I also view the fact that Senator Smit= h=20 and I have worked hard on this bill perhaps has been helpful in urging you= =20 along.''=20 FERC's fixes have fallen short=20 Published Wednesday June 20 2001 in the San Jose Mercury News=20 BY FRANK WOLAK=20 ON Monday for the third time in the past eight months the Federal Energy= =20 Regulatory Commission the agency charged with regulating wholesale=20 electricity prices in California implemented remedies that it claims will= =20 set just and reasonable wholesale electricity prices. This is a case where= =20 the third time is unlikely to be a charm.=20 As chairman of the Market Surveillance Committee of the California=20 Independent System Operator the independent committee formed by FERC to=20 monitor the California market I have analyzed the results of FERC's previo= us=20 attempts. They reveal a misunderstanding of important details of the=20 California electricity market. It is therefore not surprising that they hav= e=20 been ineffective.=20 Starting in November of 2000 FERC acknowledged that wholesale prices in=20 California during the summer of 2000 were unjust and unreasonable. Its=20 December 2000 order implemented the first set of remedies. Both the=20 California Power Exchange Market Monitoring Committee and the committee I= =20 chair pointed out important shortcomings in FERC's analysis of the Californ= ia=20 market and argued that its remedies would most likely harm rather than=20 enhance market performance.=20 At this time FERC also did not order refunds for the unjust and unreasonab= le=20 prices even though it acknowledged the prices reflected the exercise of=20 market power which is the ability of a producer to force prices higher. Th= e=20 Federal Power Act requires refunds under these circumstances. But FERC said= =20 it was unable to find specific instances of firms exercising market power.= =20 This makes no sense. If FERC finds that prices indicate market power then= =20 the generators who bid those prices are exercising market power.=20 Following the implementation of these remedies conditions in the Californi= a=20 market deteriorated far beyond what had been predicted by the two market=20 monitoring committees. Even though January and February are the lowest dema= nd=20 months of the year average wholesale electricity prices were almost 10 tim= es=20 higher in 2001 than they were during the same two months of 2000 and almost= =20 double the average price during the summer of 2000. In January March and= =20 May California experienced several days of rolling blackouts and had syste= m=20 emergencies almost every day during January and February of 2001.=20 IN April FERC made another round of market rule changes designed to lead t= o=20 just and reasonable prices. However in response to growing pressure from= =20 Congress less than 10 days after these remedies were implemented FERC=20 enacted its most recent order.=20 Before Congress declares victory it should verify that FERC's most recent= =20 plan achieves the following two goals.=20 First the plan should guarantee that the average price of wholesale=20 electricity paid by California over the next two years is equal to the=20 average price that would occur in a competitive electricity market with=20 California's current supply and demand conditions and fuel costs. The Feder= al=20 Power Act requires not just a high probability of just and reasonable rates= =20 it requires that they occur with certainty.=20 The second goal is to alter the incentives faced by all market participants= =20 so that it will no longer be profit-maximizing for a firm to withhold=20 electricity from the market in order to drive up prices.=20 FERC's most recently implemented plan does not achieve either of these goal= s=20 although it does come closer than any previous attempts.=20 One solution satisfying both of these goals has been proposed to FERC. In a= =20 December report to FERC the Market Surveillance Committee of the Californi= a=20 ISO proposed a one-time regulatory intervention. This intervention would=20 require that each generator serving California sign a forward contract=20 guaranteeing that California consumers can purchase 75 percent of the=20 generator's expected output over the next two years at a specified=20 competitive benchmark price. Once a firm has signed these forward contracts= =20 it is free to sell all remaining energy in the western U.S. wholesale marke= t=20 at whatever price it can obtain.=20 The obligation to provide power under the contracts and the incentive to= =20 sell 25 percent of power at unrestricted prices would prevent generators= =20 from withholding power.=20 Unless FERC implements a solution satisfying these two goals Congress shou= ld=20 require FERC to suspend the market-based pricing authority for all supplier= s=20 in the Western U.S. for the next two years and order all sales during this= =20 period at cost-of-service prices. This will guarantee that FERC meets the= =20 statutory mandate of the Federal Power Act in California. Frank Wolak is a professor of economics at Stanford University.=20 Wednesday June 20 2001=20 Easing the crunch on costs of power=20 It could have been worse. Yesterday the Federal Energy Regulatory Commissio= n=20 expanded limited price caps on electricity to cover 11 Western states and t= o=20 last 24 hours a day during an emergency.=20 This follows an action in April that imposed caps only in California during= =20 the hours the state declared a power emergency.=20 Under the new rules when reserves are below 7 percent in the California= =20 Independent System Operator spot markets ... the maximum price that can be= =20 charged for spot market sales ... will be 85 percent of the highest hourly= =20 price that was in effect during the most recent Stage 1 [emergency] called = by=20 the ISO the FERC explained yesterday. The order will last until Sept. 30 2001.=20 The action came after intense pressure by Democrats and the Bush=20 administration on the FERC whose three Republican and two Democrat members= =20 all voted for the new controls. It also comes after continuing stories about gouging by suppliers. On=20 Sunday the Register reported how Tulsa-based Williams an energy supplier= =20 manipulated the market to keep prices high.=20 And after Gov. Gray Davis last week attacked Los Angeles' government-run=20 Department of Water and Power for gouging the state on electricity purchase= s=20 reported the Los Angeles Daily News the DWP caved in and agreed to start= =20 selling the state power at 'cost'. The new FERC ruling certainly is better than the demand for across-the-boar= d=20 continuous price controls demanded by Gov. Davis and other Democrats. They're trying to let the market do the best it can under tremendous=20 pressure Robert Michaels a professor of economics at Cal State Fullerton= =20 told us of the FERC members. It's explicitly only for one kind of power= =20 that on short-term so-called spot market kinds of exchanges. Most power is= =20 under other kinds of contracts not touched. The main effect of the new order is that unlike full-blown price controls= =20 it should not discourage the construction of new power generators.=20 [B] POWER UPDATE/ US Senate panel to hold off vote on Calif. cap bill=20 June 20 2001=20 (BridgeNews) June 19 2124 GMT/1724 ET=20 TOP=20 STORIES:=20 US Senate panel to hold off vote on Calif. power cap bill=20 San Francisco June 19 (BridgeNews) - U.S. Senate Energy and Natural=20 Resources Committee Chairman Jeff Bingaman D-N.M. plans to hold off on=20 voting on a bill for U.S. West power price caps following a request by fell= ow=20 senators Dianne Feinstein D-Calif. and Barbara Boxer D-Calif. according= =20 to an aide in Bingaman's office Tuesday. ( Story .20121 )=20 IPE says merger with ICE complete will keep IPE name=20 New York June 19 (BridgeNews) - London's International Petroleum Exchange= =20 has completed its merger with the Intercontinental Exchange an electronic= =20 market for the trading of energy and metals products IPE Chief Executive= =20 Richard Ward said Tuesday. He said the company will still be called the IPE= .=20 His statement follows ICE's announcement Monday that all of conditions of i= ts=20 recommended offer to acquire the issued share capital of IPE Holdings had= =20 been satisfied or waived and that the offer was unconditional. ( Story=20 .17970 .19353 )=20 OF=20 INTEREST:=20 --AMERICAS--=20 FERC order seen having little effect on US generator profits=20 San Francisco June 19 (BridgeNews) - A U.S. Federal Energy Regulatory=20 Commission order to impose a soft price cap on U.S. West wholesale power= =20 prices will likely have little significant effect on producer profits from= =20 electricity sales while the order is in effect over the next year industry= =20 analysts said Tuesday. Some analysts cautioned that some producers without= =20 long-term contracts could be negatively affected by the order. ( Story .203= 40=20 )=20 White House says FERC power plan helpful step for California=20 Washington June 19 (BridgeNews) - The White House Tuesday said action take= n=20 Monday by the federal energy regulators to extend limits on electricity=20 prices in California is and can be a helpful step for the beleaguered=20 state. ( Story .18824 )=20 Calif. ISO rescinds Tues blackout forecast supplies still tight=20 New York June 19 (BridgeNews) - While the California Independent System=20 Operator has rescinded its forecast of possible blackouts for Tuesday the= =20 agency running the Golden State's electricity grid is currently projecting= =20 very little surplus power generated in the state for the day. ( Story .1491= 3=20 )=20 Three states sue DOE over air conditioning standards ruling=20 New York June 19 (BridgeNews) - Attorney generals of California Connectic= ut=20 and New York along with several consumer groups sued the Department of Ener= gy=20 to block a Bush Administration plan allegedly designed to weaken efficiency= =20 standards for residential appliances including air conditioners and heat= =20 pumps. The complaint filed Tuesday in Manhattan federal court calls the=20 administration short sighted and seeks to invalidate its rule changes. (= =20 Story .18548 )=20 NY New England ISOs expand power reserve sharing agreement=20 New York June 19 (BridgeNews) - The Independent System Operators (ISO) for= =20 New York (NYIOS) and New England (ISO-NE) have agreed to expand their=20 reserve-sharing agreement to allow for each ISO to draw on available reserv= es=20 in the other region in the event of a system interruption according to a= =20 statement issued Tuesday by ISO-NE. ( Story .19283 )=20 AGA Preview: US natural gas inventories seen up 85 to 95 bcf=20 New York June 19 (BridgeNews) - The American Gas Association (AGA) is=20 expected to report Wednesday that U.S. natural gas stocks have risen by 85= =20 billion to 95 billion cubic feet (bcf) for the week ended Friday according= =20 to a BridgeNews survey of brokers analysts and traders. The AGA will relea= se=20 the storage report at 1400 ET Wednesday. ( Story .1856 )=20 --ASIA/PACIFIC--=20 GAIL planning 20-bln-rupee gas pipeline in southern India=20 New Delhi June 19 (BridgeNews) - India's state-owned Gas Authority of Indi= a=20 Ltd. plans to lay a new 500-kilometer-long natural gas pipeline connecting= =20 the two southern states of Kerala and Karnataka at a cost of 20 billion=20 rupees the Press Trust of India said Tuesday. The pipeline will carry 6=20 million cubic meters of gas. ( Story .12193 )=20 Indonesia official sees power cuts by 2004 unless new units built=20 Jakarta June 19 (BridgeNews) - Indonesia will face power cuts by 2004 unle= ss=20 additional generating capacity is built Eddie Widiono president director = of=20 state power group PLN said at an industry seminar here on Tuesday. But=20 experts warned that the capital markets were unwilling to finance the=20 billion-dollar investments needed and the public sector could not afford it= .=20 ( Story .12536 )=20 Indonesia to restructure PLN raise power tariff says minister=20 Jakarta June 19 (BridgeNews) - The government aims to revive investment in= =20 Indonesia's power sector with a scheduled 17.5% rise in electricity prices= =20 this year and a later $3 billion debt equity swap to restructure state powe= r=20 company PLN minister of energy and mines Purnomo Yusgiantoro said Tuesday.= =20 PLN will negotiate directly with independent power producers (IPPs) to=20 install additional capacity he added. ( Story .10568 )=20 Indonesian minister claims ExxonMobil to resume Aceh operations soon=20 Jakarta June 19 (AFP) - PT Exxon Mobil Indonesia will resume oil and gas= =20 production in separatist-plagued Aceh province in early July ending a free= ze=20 of more than three months for security reasons a minister said Tuesday. (= =20 Story .10751 )=20 --EUROPE/MIDDLE EAST--=20 Czech's Temelin nuclear plant reactor to be restarted in July=20 Prague June 19 (AFP) - Reactor number one at the controversial Temelin=20 nuclear plant in the Czech Republic will be restarted on July 21 after bein= g=20 shut down for two months for repairs the plant's spokesman announced=20 Tuesday. The reactor was shut down in early May when faults were detected i= n=20 its non-nuclear secondary circuit the latest in a series of technical=20 glitches discovered since it was first put into service in October last yea= r.=20 ( Story .16716 )=20 British Energy: Sizewell B power plant back onstream=20 London June 19 (BridgeNews) - The 1188-megawatt Sizewell B nuclear power= =20 plant has been back onstream for a few days a spokeswoman for operator= =20 British Energy told BridgeNews Tuesday refusing to detail when exactly the= =20 plant was recommissioned and whether its available capacity had since been= =20 utilized by the market. ( Story .12928 )=20 Germany's Mueller says nuclear phase-down formula won't disrupt=20 Berlin June 19 (BridgeNews) - The formula for shutting down German nuclear= =20 power plants should cut atomic generating capacity only one-sixth by 2010= =20 insufficient to raise fears of shortages said Economics Minister Werner=20 Mueller. ( Story .12337 )=20 TURKEY CRISIS: Press: Govt late on IMF pledged power sell-offs=20 Ankara June 19 (BridgeNews) - The Turkish Cabinet has decided to propose t= o=20 the parliament to extend the transfer of operational rights of power plants= =20 to the private sector by another four months once again violating pledges= =20 made to the IMF when securing a U.S. $10 billion bailout package after the= =20 February crisis Sabah newspaper reported Tuesday. The government in its n= ew=20 IMF-supported program pledged to complete transfer of the rights by=20 end-June. ( Story .11978 )=20 se SPOT= =20 NEWS LINKS:=20 THE=20 MARKETS:=20 US FUTURES: UK FUTURES .1908 NY Natural Gas Pre-Opg .1795 IPE Nat Gas Review=20 .1906 NY Natural Gas Review .1794 IPE Nat Gas Midday=20 .1747 NY Natural Gas=20 US/CANADA CASH NATURAL GAS UK/EUROPE CASH NATURAL GAS .1894 Henry Hub natural gas .1807 UK Spot Gas=20 .1884 US/Canada Spot Natural Gas=20 US CASH ELECTRICITY UK/EUROPE CASH ELECTRICITY .8575 California PX: Next day .1892 UK Power Index=20 .8576 .8577 WSCC Forwards (AM/PM) .1889 Nordic Power Market=20 .8585 .8586 PJM Forwards (AM/PM) .1890 Spanish Power Market=20 .8593 .8594 Cinergy Forwards (AM/PM) .1844 UK EFA Power Market=20 .8597 .8598 Entergy Forwards (AM/PM) CANADA CASH ELECTRICITY=20 .8601 .8602 ERCOT Forwards (AM/PM) .5637 Canadian Power Market=20 .8603 New England Forwards=20 .8587 .8600 TVA Forwards (AM/PM)=20 OTHER=20 .1873 US Nuclear Plants Operating Status=20 .2029 BRIDGE CALENDAR: US POWER: Key events to watch=20 .2030 US Utility Deregulation Digest=20 .1704 US Utility M&A Digest=20 SYMBOL=20 LINKS:=20 Click below for adamb chart in Athena NATURAL GAS=20 NYMEX - IPE - NYMEX ELECTRICITY=20 Palo Verde electricity - COB electricity- Cinergy electricity - Entergy electricity - PJM electricity - BridgeNews=20 Send comments to gennews@bridge.com=20 [B] FERC order seen having little effect on US generator profits=20 June 20 2001=20 By Christine Cordner San Francisco June 19 (BridgeNews) - A U.S. Federal Energy Regulatory=20 Commission order to impose a soft price cap on U.S. West wholesale power= =20 prices will likely have little significant effect on producer profits from= =20 electricity sales while the order is in effect over the next year industry= =20 analysts said Tuesday. Some analysts cautioned that some producers without= =20 long-term contracts could be negatively affected by the order.=20 * * * FERC's decision to expand the soft price cap throughout the western grid i= s=20 not very painful for generators Barry Abramson UBS Warburg analyst said= =20 in a research note. The expanded soft price cap will have little impact on= =20 the earnings of the wholesale generating companies. By definition every=20 other power plant is more efficient than the least efficient power plant a= nd=20 thus every other power plant should be able to make a good profit selling a= t=20 the soft price cap.=20 Furthermore on most days most of the power that is produced is sold at= =20 prices below the soft price cap so the soft-price cap has little impact on= =20 the overall earnings of the wholesale generators in the region Abramson= =20 said.=20 FERC on Monday unanimously voted 5-to-0 to expand wholesale price caps to t= he=20 10 western states comprising the Western Systems Coordinating Council. FERC= =20 also expanded the price caps on wholesale power to 24 hours per day seven= =20 days per week from limits only during supply emergencies when reserve=20 margins in California fall below 7%.=20 Under the order wholesale power prices will be limited to 85% of the price= =20 in effect during the final hour of the most recent emergency when Californ= ia=20 is not in a supply emergency. The proxy price will be based on the costs fo= r=20 the least efficient power plant used to generate electricity on that day as= =20 well as the price for natural gas.=20 Generators investor-owned utilities and independent power producers=20 however can receive more than the proxy price if they can justify the high= er=20 generation costs. The plan also allows a 10% surcharge on all wholesale pow= er=20 sales in California in order to account for credit risk.=20 In a research note JP Morgan analysts Jim Von Riesemann and Anatol Feygin= =20 said that earnings for generating companies should remain relatively intac= t=20 and valuations look attractive especially for AES Mirant and NRG.=20 Robert Winters a Bear Stearns analyst said The near-term actions by the= =20 FERC (and the focus on Monday's meeting) the heightened political rhetoric= =20 and the weakening in gas and power prices across much of the U.S. over the= =20 past month has led to the weakness in the shares of the wholesale energy=20 companies...We believe very attractive buying opportunities are being creat= ed=20 within certain areas of the wholesale energy sectors where companies are no= w=20 trading at discounts to their projected earnings growth range.=20 Winters said there were buying opportunities with Williams which continue= s=20 to be our top pick in the wholesale energy space and with Enron Corp.=20 But Abramson noted that the order does not allow producers to mark up the = r=20 price of spot power for resale above the soft price cap which could affec= t=20 some profit margins.=20 The FERC plan should make it challenging for some to repeat the growth of= =20 the last couple of quarters in the West particularly those that without=20 long-term contracts. It appears that the plan would likely dampen volatilit= y=20 although price caps can have unexpected consequences said Merrill Lynch= =20 analyst Steven Fleishman.=20 On a relative basis we believe companies that have locked up much of thei= r=20 capacity under long-term contracts and have efficient baseload power are be= st=20 positioned under the new FERC plan Fleishman said in a note. He said=20 Calpine Dynegy NRG Energy and Williams stand to benefit the most from thi= s=20 scenario.=20 Companies that could be challenged are those with less long-term contracts= =20 that are more dependent on inefficient peaking plants and that could be=20 affected by less volatility in the West Fleishman said. The big question= =20 is how well the marketers positioned their books ahead of this changed=20 environment. He said Reliant Resources since it appears to have the least= =20 contracted in the West for 2002.=20 The plan which will be in effect from Wednesday to Sept. 30 2002 follows= =20 pleas from California Gov. Gray Davis to control wholesale prices which he= =20 said cost the state roughly $50 billion this year.=20 The state's largest utility Pacific Gas & Electric declared bankruptcy=20 earlier this year citing losses from high wholesale prices. End=20 SCE Unveils Rotating Blackout Web Site and Public Notification Plan=20 June 20 2001=20 ROSEMEAD Calif. June 19 /PRNewswire/ via NewsEdge Corporation -=20 Southern California Edison (SCE) today unveiled its enhanced Web site and= =20 public notification process to help guide the public through possible=20 rotating power blackouts when ordered by the California Independent System= =20 Operator (Cal-ISO).=20 We have been able to increase significantly the amount of outage informati= on=20 available to our customers because we want to empower them with critical= =20 information to prepare for and safely cope through power blackouts said P= am=20 Bass SCE's senior vice president of customer service. We recognize that t= he=20 more information customers have before and during rotating outages the=20 better equipped they will be to address the concerns and safety of their=20 families and employees.=20 Bass said customers have indicated they want to know four basic things when= =20 rotating blackouts occur: the location the duration whether it affects=20 them and what they should and should not do to safely get through the=20 outages. SCE offers several information resources that address these concer= ns=20 -- through toll-free phone lines through news media updates and now throu= gh=20 an expanded user-friendly rotating outage Web site.=20 All of these sources will tell customers that the outages rotate among=20 electrical circuits across SCE's vast service area for about one hour as= =20 directed by Cal-ISO. They will also list the likely affected customer group= s=20 and communities and even provide geographic maps outlining the specific=20 neighborhoods. Customers will also be able to access practical tips on how = to=20 prepare and function safely through outages.=20 Customers can find out the group their home or business is assigned to by= =20 identifying their alphanumeric Rotating Outage Group Number which now=20 appears directly under the customer's name and address in the top left corn= er=20 of the bill's front page. When Cal-ISO predicts possible rotating outages= =20 SCE will immediately announce which groups may be affected through its outa= ge=20 hotline -- (800) 611-1911 -- its Web site -- www.sce.com -- and through the= =20 news media.=20 When outages are forecasted or actually begin customers can determine if= =20 their group is part of the current outage or likely to be included in the= =20 next round since SCE generally interrupts groups in numerical order with= =20 some exceptions. For example customers can now hear on the morning news=20 whether Cal-ISO is predicting outages for the day. By calling the hotline o= r=20 checking www.sce.com they can learn which groups would likely be interrupt= ed=20 if circumstances turn out as predicted. If their group number is on the lis= t=20 of groups likely to be interrupted the customer could take steps to prepar= e=20 for the likelihood of rotating blackouts affecting their home or business= =20 that particular day.=20 It should be noted that group numbers may change without advance notice for= =20 operational reasons or when state regulators revise their policy regarding= =20 customers exempted from blackouts. SCE will notify customers of such change= s=20 as quickly as practical.=20 Visitors to SCE's customer Web site www.sce.com will find the following= =20 helpful enhancements:=20 -- The site displays outage group numbers and corresponding communities=20 affected during recent current and predicted rotating outage=20 incidents.=20 -- When customers click on the name of a community affected by an outage= =20 they are taken to a detailed street map of the affected circuit.=20 -- The Web site offers general outage information and links including=20 outage preparation and safety tips grid status information from Cal-=20 ISO frequently asked questions about rotating outages and=20 conservation tips.=20 -- A dynamic home-page pop-up window will change messages depending on=20 state power conditions. For example during a Stage 2 Emergency=20 customers will be directed to information about potential outages.=20 During a Stage 3 Emergency in which rotating outages are underway the=20 box will provide a hotlink to group numbers and communities currently=20 affected and likely to be affected should outages likely continue.=20 For customers who don't have Internet access SCE provides essentially the= =20 same Web site information through an automated outage phone line (800)=20 611-1911. This service makes it possible to obtain outage information=20 immediately without waiting. Among major features:=20 -- Customers can call at any time to learn the Rotating Outage Group=20 Number assigned to their home or business.=20 -- When customers experience a power blackout they can call to determine= =20 whether they are part of a rotating outage incident or if their=20 circuit has been affected by a routine interruption such as a car or=20 construction accident.=20 -- During rotating blackouts customers can learn if their circuit is=20 currently affected or may be affected in the coming hours and which=20 portions of specific communities may be affected.=20 -- When customers call they should have their account number and group=20 number handy. However if customers call during a rotating outage=20 incident and do not know their group number they will be able to=20 obtain information by entering their zip code.=20 SCE's media relations office has developed strategic communications=20 partnerships with radio and television stations that provide frequent live= =20 updates to the public including information about circuit groups affected = or=20 likely to be affected by outages.=20 It should be further noted that while SCE is committed to providing as much= =20 advance public notification about pending rotating blackouts it can only d= o=20 so as it receives timely notification from Cal-ISO.=20 SOURCE Southern California Edison=20 CONTACT: Corporate Communications of Southern California Edison=20 626-302-2255 www.edisonnews.com=20 Web site: http://www.sce.com (EIX)=20 Edison CEO/ Ruling Hasn't Helped=20 June 20 2001=20 By LESLIE GORNSTEIN AP Business Writer LOS ANGELES (AP) via NewsEdge Corporation -=20 A federal ruling this week limiting wholesale energy prices in 10 Western= =20 states hasn't been enough to pull Southern California Edison any further fr= om=20 the brink of bankruptcy Edison International chief John E. Bryson said=20 Tuesday.=20 The state's second-largest utility is no further from or closer to bankrupt= cy=20 now than it was ``two weeks four weeks six weeks ago'' Bryson told a pre= ss=20 conference before a speech to Town Hall Los Angeles a public policy forum.= =20 Bryson is chairman president and chief executive officer of Edison=20 International parent of subsidiary Southern California Edison which serve= s=20 4.2 million customers.=20 Bryson said however that he senses a warming among state legislators to a= =20 proposed bailout deal between his company and the state.=20 That deal would supply billions of dollars to Edison in exchange for years = of=20 cheap power and possibly the utility's power lines.=20 ``Interest has at least intensified in Sacramento on the part of legislator= s=20 to take steps _ debate continues exactly what steps _ to have Edison health= y=20 and to take the state out of the power business and so on'' Bryson said.= =20 Such lawmaker approval is required for the deal to survive. Key lawmakers= =20 surrounding the deal were not immediately available for comment.=20 In his Town Hall address Bryson used the forum as a kind of open plea to= =20 state legislators listing what he called a series of widespread myths that= =20 might be keeping leaders from acting.=20 ``The first myth is that somehow Southern California Edison is seeking a=20 bailout from taxpayers'' Bryson said. ``Only the reverse is true.''=20 Instead Bryson said it was Edison who bailed out California by keeping th= e=20 lights on even when the utility's power costs far exceeded its revenues.=20 Secondly Bryson said Edison and its investors are not profiting from the= =20 power crisis and SoCal Edison's parent did not act improperly by collectin= g=20 money from the utility earlier this year.=20 That money was later given to shareholders a move that outraged consumer= =20 groups.=20 Bryson also warned that a SoCal Edison bankruptcy would severely hurt=20 California's economy by scaring away new businesses and investment capital.= =20 ``Inaction would deeply hurt the state of California and all of us'' he=20 said.=20 Editorial Desk Section A=20 At Last Action on California=20 ?=20 06/20/2001=20 The New York Times=20 Page 22 Column 1=20 c. 2001 New York Times Company=20 After months of dithering the Federal Energy Regulatory Commission took so= me=20 potentially meaningful steps on Monday to contain the wholesale price of=20 electricity in California and elsewhere in the Western United States. Anxio= us=20 not to be seen as caving in to public pressure or abandoning its fidelity t= o=20 the free market the White House described the new policy as ''consistent= =20 with where the president has been all along.'' Gov. Gray Davis of Californi= a=20 for his part said the policy did not go far enough and of course only= =20 time will tell whether it does. But to many others including Senator Diann= e=20 Feinstein of California the move amounted to the first significant federa= l=20 intervention in the California wholesale market since the crisis began last= =20 year. Ms. Feinstein withdrew her own price-cap bill pending the outcome of= =20 the new plan.=20 Under the new arrangement approved unanimously by a reshuffled five-member= =20 Regulatory Commission price limits will be based on the cost of producing= =20 electricity at the least efficient generator. The formula covers the sale o= f=20 electricity for immediate delivery -- the so-called ''spot market'' that=20 supplies about 20 percent of California 's needs and that California turns = to=20 when it is desperately trying to keep the lights on. The companies will be= =20 allowed to charge higher prices during peak periods but not the huge sums= =20 they command today.=20 In addition the constraints will apply throughout 10 other Western states= =20 presumably eliminating any incentive for generators to withhold power from= =20 the California market in order to obtain a higher price elsewhere. The=20 controls are to expire in September of next year which should relieve some= =20 of the administration's earlier fears that constraints of any kind would=20 discourage investment in new and badly needed sources of supply.=20 The benefits will not immediately be felt by California consumers. Both=20 individuals and businesses have recently been hit by rate increases belated= ly=20 imposed by the state's Public Utilities Commission at Mr. Davis's request.= =20 But the new plan should ultimately benefit taxpayers by lessening the impac= t=20 of higher energy costs on the state government which has been buying power= =20 on behalf of the state's two largest utilities both essentially insolvent.= =20 Recent estimates have suggested that California which paid $7 billion for= =20 electricity two years ago could pay as much as $50 billion this year.=20 Until quite recently the president and his energy czar Dick Cheney had=20 seemed almost indifferent to California 's needs. But Republican members of= =20 Congress from California and other Western states have been growing=20 increasingly restive as they contemplate the potential political fallout in= =20 the midterm elections of 2002. In addition the two newest members of the= =20 regulatory commission both Bush appointees have expressed sympathy for=20 California 's plight. Whatever the reason the administration appears to ha= ve=20 seen the light even though it is reluctant to admit it. National Desk Section A=20 Regulators' Order Could Bring Broad California Power Accord By LAURA M. HOLSON with JEFF GERTH ?=20 06/20/2001=20 The New York Times=20 Page 14 Column 3=20 c. 2001 New York Times Company=20 LOS ANGELES June 19 -- An order by federal regulators that power generator= s=20 enter settlement talks with the State of California could open the door to = a=20 sweeping compromise of the financial issues in the state's power crisis=20 energy industry analysts and executives said today.=20 But the question that remains -- and it is a vital one they said -- is=20 whether the Federal Energy Regulatory Commission has the wherewithal to for= ce=20 the warring parties to hammer out an understanding that at its heart is a= s=20 much about politics as about money.=20 The commission on Monday gave California regulators and power generators=20 until July 9 to come up with a plan for settling accounts between the=20 generators and California 's struggling utilities. The power companies are= =20 owed billions but the state has accused them of price-gouging. If the=20 parties cannot reach some agreement an administrative judge will step in a= nd=20 recommend a settlement to the commission instead.=20 Asked at a Senate hearing in Washington today to clarify what he hoped to= =20 accomplish as a result of the two weeks of settlement talks the commission= 's=20 chairman Curtis L. Hebert Jr. was noncommittal. The parties he explained= =20 need two things for the talks to succeed: a deadline and uncertainty.=20 Senator Dianne Feinstein Democrat of California expressed skepticism abo= ut=20 the undertaking. Ms. Feinstein said at the hearing held by the Senate Ener= gy=20 and Natural Resources Committee that she was concerned that the commission= =20 had laid out ''no rules'' for the talks.=20 ''Very little if any money has changed hands as a result of prior=20 settlement conferences'' she said.=20 Many industry executives and state officials have not yet seen the=20 commission's order and they were scrambling today to figure out exactly wh= at=20 they were being asked to do.=20 ''Without seeing what exactly is in the order who knows?'' said Sean=20 Gallagher a staff lawyer for California 's Public Utilities Commission.=20 ''But we wouldn't turn our noses up at participating in negotiations.''=20 Gary Ackerman executive director of the Western Power Trading Forum a=20 coalition of energy traders and electricity generators noted that the=20 federal regulators' timetable ''has a very short fuse.'' And the fact that= =20 the state's biggest utility the Pacific Gas and Electric Company has file= d=20 for bankruptcy will complicate efforts to reach a comprehensive agreement = he=20 added.=20 ''I don't hold high hopes that a settlement would work out'' Mr. Ackerman= =20 said ''but I commend the FERC for taking a stab.''=20 Moreover the parties to the settlement talks may lack an element vital to= =20 successful negotiations: trust.=20 Several California entities including the Public Utilities Commission are= =20 investigating whether generators took advantage of consumers by charging=20 excessive prices for power. The Independent System Operator which runs the= =20 state's power grid released a study in March concluding that Californians= =20 might have been overcharged for electricity by more than $6 billion. One=20 state government negotiator said the California attorney general's office= =20 could file a suit against the power generators in the next few weeks.=20 And as state officials including Gov. Gray Davis continue to hurl attacks= =20 at the generators calling them pirates and profiteers the companies and= =20 California utilities are blaming legislators saying they failed to address= =20 the power crisis quickly enough.=20 In March Duke Energy one of the companies the state has accused of=20 profiteering offered to negotiate a broad settlement but Governor Davis= =20 ruled out calling off the state's inquiries as part of any agreement.=20 The outlines of Duke's proposal included a compromise on the money owed by= =20 California utilities in exchange for the dropping of private lawsuits=20 California 's complaints to federal regulators and the state investigations= .=20 Duke would have admitted no wrongdoing.=20 In formal proceedings the power generators to date have vigorously fought= =20 discounting the debts they are owed by California .=20 The Federal Energy Regulatory Commission has ordered generators to refund= =20 nearly $130 million in what it judged to be overcharges. Today one of the= =20 commissioners William L. Massey said 80 percent of that money had not bee= n=20 collected. A Section=20 Davis Finds Hope in Calif. Power Crunch Rene Sanchez and Peter Behr ?=20 06/20/2001=20 The Washington Post=20 FINAL=20 Page A06=20 Copyright 2001 The Washington Post Co. All Rights Reserved=20 LOS ANGELES June 19 -- Sinking in the polls under attack by a new=20 Republican advertising campaign and still struggling to avert a summer of= =20 blackouts California Gov. Gray Davis (D) nevertheless seems heartened abou= t=20 the latest developments in the power crisis that has engulfed his state and= =20 threatened his political career.=20 On his first trip to Washington in months Davis will detail California 's= =20 plight Wednesday in testimony to a Senate committee newly led by sympatheti= c=20 Democrats -- one important reason for his optimism.=20 But he has others: Conservation is taking hold in the state and prices for= =20 power on the daily spot market are dropping. California has managed to avoi= d=20 rolling blackouts so far this month in part because it has been spared a= =20 heat wave.=20 Federal regulators under pressure even from Republican lawmakers decided= =20 Monday to impose more controls on prices that energy suppliers can charge= =20 California . Two new power plants are scheduled to begin producing=20 electricity in weeks. California also has recently secured more than a doze= n=20 deals for power over the next decade a move Davis contends will stabilize= =20 the volatile wholesale market for energy.=20 In short Davis and his aides say their concerted political strategy and=20 efforts to ease the crisis are beginning to pay off.=20 The bottom line is that we're stabilizing prices and assuring the power wi= ll=20 be there without additional rate increases said Steve Maviglio a spokesm= an=20 for the governor. But he added: We're not ready to say the war is over. It= 's=20 still going to be a tight summer.=20 Whether any or all of those steps will keep the lights on in California thi= s=20 summer or help solve an array of other financial problems the crisis has= =20 caused is hardly clear.=20 In fact California 's power shortfall could produce 113 hours of rotating= =20 outages this summer according to a U.S. Department of Energy study schedul= ed=20 to be released Wednesday.=20 Since California 's two largest utilities fell into financial ruin this yea= r=20 forcing the state to spend nearly $5 billion to buy power directly and=20 saddling residents with huge new rate increases the support that Davis onc= e=20 had from a majority of voters has vanished. Recent polls suggest that he=20 could have trouble winning a second term.=20 Consumer advocates here are besieging him saying that the $43 billion in= =20 long-term power deals that Davis has signed could lock residents into payin= g=20 artificially high utility rates for years. Some contend that all he has=20 gained from Washington is political cover.=20 The Bush administration has created this toothless price cap mechanism tha= t=20 will be used as political protection but certainly not consumer protection= =20 said Doug Heller a director of the Foundation for Taxpayer and Consumer=20 Rights.=20 Davis has stuck mostly to the same political script. He is demanding more= =20 federal help for California -- on Monday he called the Federal Energy=20 Regulatory Commission's decision merely a step in the right direction --= =20 and he is denouncing out-of-state energy suppliers and their Republican=20 allies.=20 Today Republicans launched a $1.5 million advertising offensive that blame= s=20 Davis for the state's energy crunch. The spots running on English and=20 Spanish-language media describe the crisis as Grayouts from Gray Davis.= =20 Scott Reed the GOP strategist who runs the American Taxpayers Alliance=20 which funded the ad campaign said his group wants to counter the governor'= s=20 spin. The blame game has to end said Reed.=20 But Davis's aides say the ads are a sign that Republicans sense California = 's=20 energy predicament could deepen GOP political troubles in the state.=20 Privately some Republican lawmakers pushing for more federal assistance sa= y=20 they are worried that in midterm congressional elections next fall the GOP= =20 could lose House seats in California that it needs to hold a majority.=20 Today's hearing will bring both Davis and his adversaries on the Federal=20 Energy Regulatory Commission before the Senate's Governmental Affairs=20 Committee chaired by Sen. Joseph I. Lieberman (D-Conn.).=20 Instead of a committee debate on California 's electricity prices the focu= s=20 of the session may be shifting toward the billions of dollars of alleged=20 overcharges by energy suppliers.=20 Under growing pressure from both parties in Congress FERC's commissioners= =20 responded Monday with far more extensive price controls than they had been= =20 willing to consider previously. They extended April price controls that had= =20 applied only to times of power emergencies to all hours of the day through= =20 September 2002. And they expanded the controls to cover 10 other western=20 states.=20 California Sens. Dianne Feinstein and Barbara Boxer both Democrats said= =20 FERC's action was a positive step and agreed to delay efforts to direct the= =20 commission to clamp down on California 's energy prices. We're willing to= =20 give them a chance to see if it works Boxer told reporters.=20 Now Davis will press his demands that FERC recover some $8 billion in=20 alleged overcharges by wholesale power suppliers since the crisis began -- = a=20 far larger amount than the $124.5 million in refunds that FERC has so far= =20 assessed.=20 Whether there is even a chance of a peace process is unclear. Just last wee= k=20 California Attorney General Bill Lockyer announced plans to convene a=20 criminal grand jury to investigate whether power generators illegally=20 conspired to drive up electricity and natural gas prices.=20 The governor could face other new problems. Several of California 's major= =20 independent power generators said the price controls and state lawsuits=20 against the generators made it more difficult to justify expanding operatio= ns=20 in California a warning echoed today by Energy Secretary Spencer Abraham.= =20 But heading into the summer California 's power prices are much lower than= =20 they were a month or two ago with daily or spot power prices averaging $= 78=20 per megawatt hour in June compared to $372 in April.=20 Both Davis and the FERC commissioners are taking credit. S. David Freeman= =20 Davis's energy adviser said that the long-term power contracts the state h= as=20 signed the new power plants and favorable weather have tamed prices.=20 FERC Chairman Curt Hebert Jr. said Monday that the limited price restraints= =20 that the commission imposed on wholesale electricity sales in April have be= en=20 a key reason for the price decline.=20 Sanchez reported from Los Angeles and Behr from Washington. Staff writers= =20 Mike Allen and Juliet Eilperin contributed to this report from Washington.= =20 Contact: National Desk Section A=20 The Lesson of When to Give Aid to Free Markets By DAVID E. SANGER ?=20 06/20/2001=20 The New York Times=20 Page 14 Column 3=20 c. 2001 New York Times Company=20 WASHINGTON June 19 -- Three weeks ago George W. Bush addressed a sympathet= ic=20 audience of business executives at the Century Plaza Hotel in Los Angeles a= nd=20 declared that his administration ''will not take any action that makes=20 California 's problems worse and that's why I oppose price caps'' on=20 electricity .=20 As he spoke the Democratic governor of California Gray Davis sat=20 impassively on the dais preparing to meet Mr. Bush and then denounce him f= or=20 failing to protect California consumers from an electricity market gone wil= d.=20 Today the White House halfheartedly welcomed action by federal regulators = to=20 impose throughout the West a system that looks and smells a lot like price= =20 caps -- though the White House said it was something different.=20 ''This is not a price control'' Ari Fleischer the White House spokesman= =20 said. ''This is a market-based mitigation plan that now will extend to 11= =20 Western states.''=20 In fact it bore some resemblance to a proposal made by 10 leading economis= ts=20 who urged a middle ground between fixed prices and a deregulated electricit= y=20 market. Mr. Davis used their proposal to support his position in favor of= =20 limited price restraints when Mr. Bush visited California .=20 The White House shift from outright opposition to price controls to its mor= e=20 nuanced position today exemplifies how Mr. Bush has tempered his embrace of= =20 completely unfettered markets in recent weeks. He didn't have much choice.= =20 As the threat of blackouts loomed demands for action rose from officials o= f=20 both parties and from consumers in the West. It was almost possible to hear= =20 sighs of relief at the White House today that the Federal Energy Regulatory= =20 Commission -- an independent body in the Energy Department -- had moved to= =20 turn down the political heat.=20 In fact while some House Democrats are still pressing for firmer caps on= =20 prices Senators Dianne Feinstein Democrat of California and Gordon H.= =20 Smith Republican of Oregon withdrew a bill that would have placed strict= =20 price controls on electricity sold in Western markets.=20 Senator Feinstein said the White House could call yesterday's regulatory=20 action ''mitigation'' or anything else it pleased.=20 ''A rose is a rose by any other name'' she said today.=20 And a free market is not always free. Two weeks ago the administration said= =20 it would rescue steel companies and steelworkers who have long complained= =20 about unfair competition from South Korea Taiwan China Brazil Germany= =20 Russia and Ukraine. The White House defended the action by saying it was th= e=20 only way for the industry to adjust to a new competitive environment.=20 Last month with no major announcements at the White House the Bush=20 administration voted for International Monetary Fund aid to two countries= =20 Turkey and Argentina that (like California ) had made some economically=20 disastrous political decisions.=20 In each case Mr. Bush's economic orthodoxies were tempered by political=20 realities.=20 The California crisis was one thing when it involved a Democratic governor = in=20 a state Mr. Bush lost by a million votes it was another one of his aides= =20 conceded today when congressional Republicans from around the West were=20 warning Mr. Bush that blackouts and sky-high prices could blow up in his=20 first year in office.=20 ''We heard from a lot of members of Congress who feared that Republicans=20 would be tarred with worsening the problem even though it happened on Gray= =20 Davis's watch'' the political aide said. ''The president took that on=20 board.''=20 Similarly the steel decision was partly about enforcing laws against=20 ''dumping'' foreign products in the market -- and partly about Mr. Bush's= =20 desire to convince labor unions not to block his trade agenda. Like=20 Californians coping with higher energy prices the steelworkers need time t= o=20 adjust to a new world the administration said.=20 ''Open markets improve the lives of people by increasing opportunity choic= e=20 and economic freedom'' Robert B. Zoellick Mr. Bush's trade representative= =20 said in an interview today. ''But compassionate conservatism also recognize= s=20 the reality that the effects of rapid change fall harder on some communitie= s=20 and industries'' which he said need ''vital breathing space to adapt to= =20 change.''=20 While Mr. Bush expressed deep reservations about I.M.F. bailouts during the= =20 presidential campaign the situation seemed a bit more complicated once he= =20 got to Washington. The State and Defense Departments feared that if Turkey= =20 were engulfed in economic chaos and blamed the United States for failing t= o=20 come to its aid its leaders might be less inclined to let American fighter= =20 jets use its territory to mount missions over Iraq.=20 So given the choice between letting the Turkish people pay a high price for= =20 political mistakes -- Californians take note -- and weakening American=20 pressure on Saddam Hussein Mr. Bush decided that economic niceties were le= ss=20 important than political consistency. Mr. Bush chose the Pentagon over the= =20 Treasury.=20 Administration officials said these actions did not represent a retreat fro= m=20 let-the-markets-prevail orthodoxy.=20 Lawrence B. Lindsey Mr. Bush's chief economic adviser said in an intervie= w=20 today that he opposed price caps at the beginning of the California crisis= =20 and that he opposed them now. But he would not criticize the federal=20 commission for ''mitigating'' price spikes in the market.=20 ''What they are trying to do is achieve two incompatible missions --=20 preserving what is called 'just and reasonable pricing' and assuring an=20 adaquate supply of electricity '' Mr. Lindsey said. Yet the reality he=20 added is that new supplies of electricity will not become available for a= =20 year or more. ''FERC is doing its best to square that circle in the face of= =20 the fundamental problem which is inadequate supply'' he said.=20 That is the kind of argument that keeps economists happily arguing for hour= s.=20 It is not likely to be the kind of argument Mr. Bush himself is likely to= =20 engage in for long. As one of his political advisers said the other day=20 ''Don't think about this purely in terms of megawatts. We need to produce= =20 more electricity but we also need to produce some more seats in the=20 House.''=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: ticket Body:: vkaminski@aol.com What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Do you still expect Guinn to call Ken? If so do we have updated talking points (and background) for Ken? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: JDF Gala Body:: Thanks for the invite (and the follow up voicemail). I'd love to see the General (and you of course) but I'm going to have to pass. Thanks anyway. Sent by: Cathy Phillips@ECT To: Steven J Kean/NA/Enron@Enron cc: Subject: JDF Gala I would like to invite you and a guest to join me for the annual Juvenile Diabetes Foundation Gala to be held on May 12 2001 at the Westin Galleria. The guest speaker this year will be General Norman Schwarzkof. Please contact Cathy Phillips (X-36898) and let her know if you are interested in attending. Thank you. Mike What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: IHI Arbitration: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT COMMUNICATION Body:: That all depends on your definition of the wordjob. It was actually anticlimactic---Mark told Bob he needed to stick around on some of the old EI litigation a fact we already knew. Are you at the Sempra deposition. how is it going? Gail Brownfeld/ENRON@enronXgate 03/07/2001 03:06 PM To: Richard B Sanders/HOU/ECT@ECT cc: Subject: RE: IHI Arbitration: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT COMMUNICATION He keeps saying that he needs the $15 million. Maybe it's a budget thing. I think he really just wants to renegotiate the deal. I don't think he thinks that IHI has the money to pay us back. What happened at the meeting on Monday with Mark? Do I still have a job? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Opportunity Body:: any interest? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I just spoke with Clark Smith head of Elpaso's merchant arm. I told him that we had been hearing that El Paso was blaming Enrononline for problems in Western gas markets. He asked for some more specifics about who exactly was spreading the rumor (I told him we had heard it from 3-4 sources). He acknowledged that EOL was not the problem said he couldn't believe that it had been identified as such and said he would bring it up on his call with his Washington team this afternoon. I think he will put it to rest (except for whatever damage has already been done). I did promise to get some more specifics on who has told us that El Paso pointed to us. Can anybody give some info on that? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Entry tax to dergulating markets Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Dow Jones: Enron, Bushs Biggest Contributor Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CONFIDENTIAL - Residential in CA Body:: Were you on the call yesterday---I went ballistic. And where are you now!?! The calls underway. Karen Denne 04/13/2001 12:45 PM To: Jeff Dasovich/NA/Enron@Enron cc: Subject: Re: CONFIDENTIAL - Residential in CA I get so worked up over this issue... I really think now is the time to speak up and dissent. Skilling told us at a floor meeting that as an organization we've made poor decisions in the past and he believes it's because the people who disagreed with those decisions never spoke up. So help me out! From: Jeff Dasovich on 04/13/2001 12:34 PM Sent by: Jeff Dasovich To: Karen Denne/Corp/Enron@ENRON cc: Subject: Re: CONFIDENTIAL - Residential in CA Amen. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: From Michael L. Kirby, Esq. Body:: Bonnie: Please forward to Michael Kirby. I think the draft looks good. Could you also prepare a draft of the letter we discussed yesterday to convey the proposal to the committee? Bonnie Hugyez on 07/17/2001 12:34:20 AM To: cc: Subject: From Michael L. Kirby Esq. Attached is a draft Nonwaiver Agreement per our telephone conferences of yesterday after the meetings with Senator Dunn. I am available in my office for a conference call to discuss this. The information contained in this e-mail message and any accompanying documents is subject to the attorney-client privilege and/or the attorney work product rule and is confidential business information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient or representative of the recipient you are hereby notified that any dissemination of this communication is strictly prohibited. If you have received this communication in error please notify Kathryn A. Pugh at kpugh@pkns.com and immediately delete this message from your system. - 289271_1.WPD What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: HIGH PRIORITY - PRs PRC Meeting Body:: Please get available dates. I need to be there for this. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meeting with RW Beck, per Everett Chartier, 508/935-1675. Theyll be in a conference room to be determined. Body:: Dan Leff also setting up other meeting with wholesale retail and gov't affairs people with RW Beck.Rates discussion - Rebecca knows you won't be there. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Birhtday Body:: Kevin Thanks. I am becoming an old man. Vince What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enrons Matching Gift Program Body:: Tim -- Cindy manages this program. Mary -- please give some thought to how we might solicit employee views on this. Cindy -- I believe we already allow matching of donations to quasi-religious organizations: religious schools for example and perhaps relief organizations like Catholic Relief Services? I think that if we want to consider extending it we should probably discuss it in a smaller group than the e-speak forum -- the Enron Foundation Board perhaps? This could become controversial though (recall the Planned Parenthood debate and the periodic attempts of shareholders to add restrictions through the proxy mechanism). ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Nepal Body:: There may be some press today about Enron's involvement in the Nepal hydro project. The government of Nepal is hopeful that we will pursue it but we are not going to. Kelly's response on press inquiries will be that we are not pursuing the project. Kelly will also be getting in touch with David Howe. I just wanted to keep you guys posted in case you are getting questions. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Humberto (Beto) Kuhn, resume Body:: Humberto - I forwarded your resume to Barry Hunsaker who is general counsel at EOG Resources. As you may know EOG used to be Enron Oil and Gas a majority-owned Enron subsidiary. A couple of years ago Enron sold its interest in EOG and it became a stand alone company. EOG Resources has been doing very well. I don't know if they are looking for lawyers now but I think I sent your resume to the right place. Humberto Kuhn on 05/21/2001 11:17:21 AM To: cc: Subject: Humberto (Beto) Kuhn resume Dear Steve:? With sincere and advance thanks and pursuant to your recent conversation with my brother George I attach a copy of?the short version?of my resume.? I have a longer detailed version as well as numerous references that I will be pleased to furnish you.? In addition I am at your disposal at any time that?you or any others at ENRON should wish to meet with me.? Again?my thanks for your assistance and guidance. ? Kind regards ? ? Beto Kuhn Cell:? 713/ 906-8463 Res:? 713/ 467-3974 - RESUME HGKShort Form 05-01.doc What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: address Body:: JOSEPH KOOTHRAPPALLY (713) 853-6819 jkoothr@enron.com What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Markets Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Portal Body:: Attached are some late night thoughts on the portal. Most of this is focussed on the portal for opinion leaders but some of it could be applicable to the comemrcial portal as well. Could you forward this to Palmer ... for some reason my address book doesn't pull him up when I'm off the system. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: PG&E PX Credit Calculation -- CONFIDENTIAL ATTY CLIENT WORK PRODUCT Body:: Except that my understanding of the SCE model is that the CTC structure will continue beyond 3/31/02 (and may then apply for PG&E). I agree that if you were to go to a bottom's up it would require the CPUC to put in place a surcharge for remaining stranded costs (non-generation for example QFs) and a second surcharge for Negative CTC overpayment. Key question is who will pay the Negative CTC overpayment? On trying to understand the PX Credit algorithim my concern is that to understand how much the overpayment was during Oct - Feb we need to understand how costs hit the structure during that time period. Otherwise we don't know what form or amount of discount is required in the Settlement talks. Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Mondays follow-up meeting on cost control Body:: I am calling Rob Walls to see if he can attend. Carol Ann Brown@ENRON COMMUNICATIONS 03/30/2001 02:49 PM To: Steven J Kean/NA/Enron@ENRON cc: Subject: Monday's follow-up meeting on cost control Steve Should Jim Derrick be invited to Monday's cost control meeting? I asked Kevin and he told me to ask you. Suzanne Brown came by today and said that his name was brought up at last week's meeting. Sincerely Carol Brown Office of the Chairman Enron Broadband Services Inc. 713.853.7974 713.853.9469 - fax carol_brown@enron.net What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Draft - Confidential - New Procedures to be introduced by ENA OTC for Exec Employment Agreements and Hiring of Commercial Staff below VP into ENA Body:: So I guess Dave doesn't want to send this out. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: TW Gas Sales: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT PRIVILEGE Body:: In anticipation of potential litigation involving TW's operational activities please prepare an analysis for me of the reasons for TW's sale of excess natural gas at the California border. I am aware of several of these sales and have been informed that excess pressure at the border is the basic reason for them. I'd like a more specific explanation that includes the following information: 1. What are the specific pressures and volume considerations that could make it operationally necessary to sell gas at the California border? 2. What is the process that is followed to make such a determination? 3. Which individuals or groups are involved in determining whether an operational sale is necessary? 4. In what way have system operations changed since last year and how do those changes contribute to the increased frequency of such sales compared to previous years? 5. What alternatives to operational sales are considered before the decision to make a sale is reached? Thanks for your attention to this request. Please give me a call to discuss and please designate your response as Privileged and Confidential Attorney Client Privileged. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: BIPAC Board meeting Body:: I wuold like to attend if my calendar is open ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Beta Gamma Sigma Body:: Thanks for the invite. I would suggest Jean Ryall - who heads our Texas government/regulatory affairs team. She is certainly more familiar with the details (of which there will be many more after this legislative session and the conclusion of the pilot program). She is also a very good speaker (and can probably relate a few war stories to spice things up). From: Susan Skarness/ENRON@enronXgate on 05/04/2001 11:20 AM To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Subject: Beta Gamma Sigma Steve I am a member of Beta Gamma Sigma (BGS) the honor society for business programs accredited by AASCB - The International Association for Management Education. If you are not familiar with BGS a member must be in the upper 5% of their class as a junior and the upper 10% as a senior and in graduate school to be nominated for induction into the society. In an effort to provide additional programs and benefits to alumni members alumni chapters are being developed around the country. There are currently nine alumni chapters around the U.S. with a new one being formed in the Houston area. I am serving on a steering committee for the development of this Houston Area Alumni Chapter. Our primary reasons for starting a Houston Area Chapter include networking professional affiliations outreach to students resources learning opportunities and providing scholarships. Our initial outreach to Beta Gamma Sigma members will be through a reception/dinner to be held in October 2001. We are currently looking at either October 16 or 18. All 6200 Houston area members will be invited to participate however we expect attendance to be closer to 75-100 people. The ages experiences and business affiliation of the members will be very diverse but all will have the common thread of business excellence. The details of this event are still being finalized however at our last meeting the discussion encompassed possible speakers and topics. Overwhelmingly the team decided on Electricity Deregulation in Texas and since I work at Enron I was asked to assist in locating a dynamic speaker. Cliff Baxter suggested that you would be an ideal speaker on this topic. Are you available and willing to address this group in October? If I can provide any additional information please let me know. Thank you for your consideration Steve. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Pipeline safety legislation - update Body:: print What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Crisis Update (No. 10) Body:: We have been pulling together these weekly(sometimes more often) summaries for internal purposes. Would you find it helpful to be on the distribution list? Hope you are doing well. Look forward to touching base soon. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I set up a meeting for next Friday in Washington with Ed G. and Ralph Reed starting at 7:30 am. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Congratulations Body:: Thanks. Vince J Kaminski@ECT 01/11/2000 08:01 AM To: Richard Shapiro/HOU/EES@EES cc: Subject: Congratulations Rick I have just looked at the memo regarding promotions. Congratulations - well deserved. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Sen. Hagels ESI speech Body:: The senator's speech is focused on the oil sector almost exclusively but it does an exceptional job of framing the importance of the issue. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Privileged and Confidential Attorney Client Work Product Body:: Rick Committee staff attendees included David L. Cavicke (Committee Majority Counsel) Brian McCullough (Committee Majority Professional Staff Member) Christopher Knauer (Committee Minority Investigator) and Michael Geffroy (Committee Minority Counsel). Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:NEMEC GERALD Email:gerald.nemec@enron.com - 7138533512 ? Enron Wholesale Services - Office of the Chairman ? From:??Mark Frevert Chairman & CEO ??????Greg Whalley President & COO ??????Mark Haedicke Managing Director & General Counsel ? Subject:??Confidential Information and Securities Trading ? Enron Wholesale Services ('EWS') maintains official Policies and Procedures Regarding Confidential Information and Securities Trading ('Policies and Procedures') which have been revised as of November 15 2000 to reflect the new EWS structure. These policies and procedures are intended to allow us simultaneously to pursue our diverse businesses and to protect confidential information our reputation for integrity and EWS and its employees from legal liability. ? You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: ? ? You must certify your compliance with the Policies and Procedures within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Lance Schuler at extension 3-5419 Mark Haedicke at extension 3-6544 Alan Aronowitz at extension 3-3214 Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: SBX 6 / SBX 33 Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: CONFIDENTIAL Information Request for Henry Bath US Body:: I am not aware of any. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Body:: Aruna I shall be in London this week. Please call me on Monday next week. Best time is between 7:30 and 8:30 my time. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: ISOs Response to BPA Rebuttal of Sheffrin Study--Confidential Atty Client work product Body:: I recommend reading CAISO's response. This letter was reported in last week's trade press. I am told that BPA does not consider this letter confidential even though it is labeled as such by CAISO. Many of the CAISO backpedal statements made re: claims of strategic bidding would apply equally to other importers. Alan Comnes What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Department meeting conference call. 800-283-1805, in Ricks name. Body:: Page Montovano Diane -- pay for part of an admin Ken Rice Steve Shackman -- MayaMora Weber 609 279 4094 Cal trip Leave meessage for Eliz and Karen 39504 Sheila Galloway Ralph Cavanagh (415) 777 -0220 Mike Day 415 781 0701 Meg Nollen What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Errata to SRP Settlement Proposal - Privileged and Confidential F or Settlement Purposes Only Body:: In our July 30 2001 document entitled Receipt Capacity Allocation Proposal Prepared By Salt River Project there is an inadvertent error. Section I.F. properly states that the numbers used in this proposal would be updated with peak figures through the last season prior to additional capacity being placed into service by El Paso. Consistent with that Section II.A. in describing the CD and FR Entitlement Methodology should read as follows: II.A. A total peak day entitlement is established for each FR customer by summing its highest (peak) single day takes during the period January 1 1997 through the end of the last season prior to additional capacity being placed into service by El Paso at each of its D-Code points (eg. DAPSPHX DSWGPHX etc.). (footnotes 1 and 2 unchanged) Please make this change to your document. We apologize for the error. Joel Greene Energy Advocates LLP 202-371-9889 202-371-9025 (fax) jlgreene@energyadvocates.com What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Southern Co.s Testimony Body:: I think a rebuttal would be in order if others agree. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Project Stanley Q&As Body:: I think the Qs and As look good. I wouldn't bring up the California situation (eliminate the second half of A25). Eric Thode 08/22/2000 04:53 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Project Stanley Q&As Comments? ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: The Energy Daily, EEI, and EPRI Present ""Surviving The Summer of 2000: A Summit On Reliability"" Body:: I'm normally not a big fan of conferences but this one may be of interest. I think it may be of even more interest if we don't speak: it's possible some utilities may say some of the same things we would say but they may be less likely to do so if we speak and they feel they have to respond. Let me know what you think. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: Can you guys coordinate to make sure someone listens to this conference call each week. Tara from the fundamental group was recording these calls when they happened every day. Phillip ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Fletcher School/Enron Body:: Thaniks for the note. Christie is now organizing our university relationships so direct the communication to her. Thanks again David Merrill@ENRON_DEVELOPMENT 09/09/2000 05:59 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: Fletcher School/Enron Dear Steve: Last month while at my reunion at the Fletcher School of Law and Diplomacy at Tufts University some of the school officials told me that Enron has hired about eight Fletcher graduates recently and is happy with them. The school is also happy and wants to strengthen its relationship with Enron. They had earlier this year contacted a Laura Kalmans Director of Community Development at Enron to discuss various ideas for cooperation with Enron that would strengthen our capacity in environmental matters and give the students exposure to real world issues but nothing happened and they lost contact. They asked me who they should contact to find out how to pursue this and I said I thought it might be you or someone under you. They now want to send a letter to someone at Enron on this proposal. It is OK if it is addressed to you or should I tell them another name? Please advise me how to steer them in the right direction. Many thanks. David Merrill ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Hap Boyd Promotion Body:: I don't really have a problem with this but I thought that all VP promotions were supposed to go through our year end process. That's what I have been saying in response to the inquiries I am getting. Ken being newly back in the fold likely didn't know about the process. Kurt S Huneke@ENRON_DEVELOPMENT 12/12/99 08:31 PM To: Steven J Kean@EES cc: Subject: Hap Boyd Promotion First I heard about this. I assume it is a reward for the PTC extension. Hope it makes sense to you. ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Lawmakers Vote to Limit Power Costs - WSJ Body:: Look at this. Baum finally speaks up -- way too late. Can somebody tell me what SDG&E's energy rate was pre-dereg? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Spoke with Jeff Body:: I'm glad things are moving forward. I've talked with Dave briefly and will follow up with him again. Kevin Scott on 07/13/2001 10:14:01 AM Please respond to kevinscott@onlinemailbox.net To: Steve Kean cc: Subject: Spoke with Jeff Steve As planned I spoke with Jeff this morning. It was a great call. I am really excited about what is ahead. We discussed the title issue. I don't have any problems. We should go with what is the best way to enter the organization. Jeff said he was going to touch base with Dave this morning to move the process forward. I can't wait for my interviews and to join the team. Thanks for all of your help. Kevin Contact Information E-mail kevinscott@onlinemailbox.net Phone (213) 926-2626 Fax (707) 516-0019 Traditional Mail PO Box 21074 ? Los Angeles CA 90021 What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: US Conference of Mayors, and Association of Counties - In Washington DC Body:: Vista Hotel1400 M Street 202-429-1799 202-728-0530 Panel discussion - Bill Darcy is the other panelist will give overview and do a defensive speech. You can discuss opportunities and give offensive speech. He doesn't know how many people to expect but will introduce you to some of the big people there. He'll be passing out an outline of his point of view you can use overheads handouts whatever you like. Time is not yet set. **CANCELLED** What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CA Price caps Body:: I'm afraid we have our work cut out for us. We have been working the proces at the state and federal level in the past couple of weeks. I continue to believe (hope) Susan J Mara 08/11/2000 11:56 AM To: Steven J Kean/HOU/EES@EES cc: Subject: CA Price caps I heard you've been raising a ruckus about our activities on the price caps -- asking us to do more. Thanks. I feel as if I have been a voice in the wilderness for the past six months when I was trying to get people to pay attention to the bad things happening in CA and warning that the problems (mainly a threat of reregulation) will spread elsewhere. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Nigeria Contract support Body:: Sean - is this anything we need to follow up on? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Electricity Deregulation Report Card Body:: I think I confirmed for this already but could you check and put on my calendar and put this in the meeting file. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Advertising Body:: do we have a mechanism to survey employees? Can we do a scientific poll? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Update on House RTO Activities Body:: There are now two House hearnigs tomorrow not just one. In the morning there is a panel on reliability siting and incentive pricing for transmission. Jim Steffes is the EPSA witness. The RTO-related hearing originally scheduled on a separate day will be in the afternoon tomorrow. Peter Esposito of Dynegy is the expected EPSA witness. I am checking on the final list of other panelists and will advise. Finally Andy Black of Chairman Barton's staff advises that they will release draft RTO language as early as today. We expect that this draft will not be to our liking. Barton thinks FERC is moving too quickly and with too much force. We expect his proposal to set a deadline of something like 12 months for utilities to join an RTO. The key is in part whether he allows FERC to continue to decide what constitutes an acceptable RTO or whether he will try to grandfather in some fashion those RTOs that have been proposed by utilities to date. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Mike - perhaps you can help me or forward this on to someone who can. The people in my organization support all the Enron business units but many are specifically dedicated to certain business units. As a consequence we have ended up on a variety of LANs with a variety of support people. Due to the fine efforts of your team many people in my group have migrated over to the Enron Corp LAN. We are also now enjoying great support from Russell & Russell (Servat and Mitchell). As the IT guy I'm sure you are accustomed to such profuse praise. However many of the people on my team (including me) are on the EES LAN. Historically EES has supported us with the equipment we need and they too have been doing a fine job in that regard. Historically therefore we have not budgeted for IT .... a practice which will change starting next year. In the meantime when we sought to migrate the rest of my organization to the CORP LAN we were told that we would have to pay for all of our current equipment or give it back to EES. If you need me to I can explain in detail why this makes no sense. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Phoenix/Equilon Deal; CONFIDENTIAL ATTORNEY/CLIENT COMMUNICATION AND ATTORNEYS WORK PRODUCT Body:: Joe R. will be sending out something in greater detail shortly but it appears that Equilon's management would like to pursue a deal with us on an exclusive basis and that this decision is being forwarded to the Equilon Board for approval. If this acquisition goes forward we will need to get organized---in the near term---on a number of logistical/due diligence tasks but one thing we should start thinking about now is the disclosure issue. If the Equilon Board gives the go-ahead for Equilon to pursue this transaction Equilon will probably want to sign a memorandum of understanding with us and this may put us in a disclosure posture because at that point we would be looking at a $65 million deal (approx.) with a closure probability of no less than 20% (in my judgment based upon our past dealings with these people). Even without a signed document the size/probability test would still be an issue for us to deal with. Everyone should be thinking about this issue as we await word from Equilon's Board. Thanks. SWD What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: WPTF Friday Crazy About U Burrito Body:: THE FRIDAY BURRITO=20 Ben Zycher from the RAND Corporation used the following line in his talk at= =20 the WPTF General Meeting in Phoenix a few weeks ago. The story takes place = in=20 the good ol' days of the Soviet Union when Brezhnev was Premier.? Brezhnev= =20 and the rest of the Politburo one fine May Day were watching the tanks and= =20 missiles pass by the Kremlin Wall when Leonid noticed in the middle of the= =20 parade a truck carrying a group of civilians.? He turned to Dmitri Ustinov= =20 the Defense Minister and asked Who are they?? Ustinov replied Those a= re=20 our economists.? You just wouldn't believe their destructive potential.=20 This is appropriate for our time and our situation.? The economists descend= ed=20 upon us when the California market was designed but we know not from where= .?=20 Aliens?? Since weaving conspiracy theories is a popular past time in=20 Sacramento (We just know they are gouging us them bullies) I believe th= at=20 one must do the same by following the money.? I'm not talking about the=20 campaign contributions in Gray Davis' pocket. The most money has gone from= =20 power sales in California to the Canadian Province of British Columbia.? It= =20 was a plot the Canadians hatched. I mean look at Governor Davis.? He looks= =20 kind of BC-ish.? Skinny and lanky wimpy hair and a hesitation in his=20 speech. He talks their language: a mix of misspelled French (meet me at th= e=20 centre) English and Eh(?).? One night in 1996 the BC government secretl= y=20 sent us some economists by the truckload to destroy California.? The=20 utilities probably paid for the bus tickets.? I happen to know that Frank= =20 Wolak Chair of the ISO Market Surveillance Committee once lectured at a=20 University in Vancouver B.C..? What more evidence do you need?? The BC=20 Government sent us cheap hydro power sold at inflated market prices so tha= t=20 they could do what the citizens of California wanted to do with their budge= t=20 largess =01( build roads schools and hospitals. They didn't think we coul= d=20 figure out their plot but we did.? Now is the time for California to=20 counter-attack.? We'll send them some of our politicians a bipartisan grou= p=20 including a few who can add and some of our select energy thugs from the= =20 CPUC and the Blind Oversight Board.=20 Speaking of times and situations there was a time when discussing the ISO= =20 words such as communist and Nazi were only uttered by my pal Carl=20 Imparato.? We would shake our heads and chuckle at Carl's extremism.? We= =20 aren't laughing now.? The descriptors seem to arise again and again in poli= te=20 conversation by a wider circle of people.? I watch with utter amusement=20 (because the alternative is retching breakfast) at the demagoguery of the I= SO=20 Governing Board the Market Despair Team the Governor's office and some= =20 members of the California Legislature. Like an audience watching a tragedy= =20 from hell we scream aloud These people are crazy!? And indeed they are= .?=20 Mr. President is not helping us at all by continuing to wrangle over who ge= ts=20 the musical Chair at FERC =01( Bubba Curt or Bubba Patrick.? Listen to us = Mr.=20 President.? Let Bubba Curt keep the reigns for a year or two and let Bubba= =20 Patrick take a seat at the table.? We need someone with a shockproof BS=20 detector.? Someone who can honestly field a motion to dismiss the Californi= a=20 ISO.? The time is long overdue to shoot this horse in the head.=20 Not all is evil.? This week in Houston the resource capital of California= I=20 visited the trading floor folks at Dynegy before attending the WTPF Board= =20 meeting.? The coolest thing I saw besides all the neat gadgets on each=20 trader's desk was the coffee machine.? Brother Jolly Hayden showed me how = to=20 use it.? You pick the type of coffee you want.? The contents of the coffee= =20 are in a shot-glass sized plastic tub with a foil top.? I picked Venezuelan= =20 #6 Decaffeinated Waxy Crude.? The tub is placed inside the brewing machine= =20 and the start button is pushed.? Presto coffee drips from the spout into a= =20 waiting cup.? I asked Jolly How did the hot water get mixed into the grou= nd=20 beans?? He removed the tub from the machine and showed me a pin prick hole= =20 made in the foil top and another that was made at the bottom.? Is that nea= t=20 or what?=20 I would like to buy a brewing machine just like the Dynegy coffee machine= =20 but a little larger.? I would set up a booth in Sacramento on the corner o= f=20 11th and L and bark out to passing members of the Legislature Free spa= ce=20 shuttle. Come and see life on other planets.? They would jump at the chanc= e=20 to visit other planets.? I would seat them in the machine push the start= =20 button and voila.? Dripping out would be the essence of democracy.? Don't= =20 worry about the holes needed at the top and the bottom.? They are already= =20 there and quite enlarged.=20 Back to my day at Dynegy.? Trade floors might seem similar across companies= =20 but the small differences speak to the management style embraced by the cre= w=20 and its leaders.? Each electric trading desk for various parts of the=20 country is set up a little bit differently.? For example some desks have = a=20 person doing asset-backed trading but some don't.? When I arrived at 6 a.m= .=20 Houston time the Eastern desk was busy in its trade day.? The Western folk= s=20 hadn't arrived yet.? Later I sat with Randy LeForce of the Western desk.?= =20 Captain LeForce to you he told me.? He could talk big because Dave=20 Francis who sits next to Randy and hangs witty quotes from the ceiling=20 above his head (Even a blind pig could make money in this market) was on= =20 vacation.? As the pace of the trading gathered steam Randy kept an eye on= =20 all the different people working the Western trading desk.? The Captain=20 worked it like a maestro.=20 During my visit some Dynegy folks came up to me introduced themselves an= d=20 said how much they enjoyed the Friday Burrito.? I'll tell you what.? There= =20 are few things in life that give me as much satisfaction.? Complete strange= rs=20 who tell you that something you do makes them feel good well it doesn't g= et=20 any better than that.? Garrison Keillor the well-known author of Lake=20 Woebegone Days and NPR radio entertainer once said a writer should have an= =20 audience.? Not everyone in the world should be in the audience but an=20 audience nonetheless of some people.? I now know what he means.? And the=20 people I met on the trading floor felt like they knew me and shared with m= e=20 their thoughts and opinions on a lot of things.?? Often they asked me Are= =20 those California people really that crazy?=20 Since last week you might have noticed the pace at the FERC has picked up= =20 somewhat.? Last Friday the FERC issued an Order on possible refunds for=20 alleged overcharges by parties selling to the ISO last January.? That was= =20 news worthy.? Then on Wednesday the FERC issued an Order to remove barrie= rs=20 to additional electric generation in the West.? The Order admits that it=20 won't change the dire situation in the West but these are steps in the rig= ht=20 direction.? The FERC also issued on Wednesday a show-cause order to AES and= =20 Williams regarding the maintenance of RMR units that were called by the ISO= =20 in April and May of 2000.? That is a serious case that we must watch=20 closely.? Also this week the California Senate kicked off its own=20 investigation (this will be the tenth such investigation of the California= =20 markets to uncover alleged price manipulation).? The Senate Committee will= =20 have subpoena rights and if I understand it correctly they plan to subpoe= na=20 individuals.? Sounds like a Kangaroo Court and a Three-Ring Circus to me.= =20 Thursday Secretary Abraham stated in a congressional hearing that the West= =20 would certainly experience power outages this summer. Finally an LA Times= =20 reporter asked me if I had heard that a small QF company had filed for=20 seizure of SCE property to satisfy an outstanding debt.? That would be step= =20 one of the bankruptcy cha-cha.? All in all a typical week among crazy=20 people.=20 Let's see what else we can talk about.=20 Things in the People's Republic of California=20 ?@@@ PUC Updates Utility Liabilities=20 ?@@@ Be a Source for Energy Price Update=20 ?@@@ BPA Misquoted in the WSJ=20 Things FERC=20 ?@@@ Market Monitoring Proposal=20 Letters=20 Jobs and People=20 Odds & Ends (_!_)=20 =3D=3D=3D=3D=3D=3D=3D=20 Things in the People's Republic of California=20 ?@@@ PUC Updates Utility Liabilities=20 My favorite regulator the California PUC issued an Order in the Utilities= '=20 Rate Stabilization case to re-open the record on utility audits.? Although= =20 the text of the order is unremarkable the data tables bring up to date as= =20 of March 8 the outstanding liabilities of PG&E and SCE.=20 The PG&E commercial paper obligation due as of March 8 increased by $354=20 million since January 31 for a total default amount of $790 million.? QF= =20 purchases increased by $280 million for the same five-week period now=20 totaling $651 million.? The ISO payments increased $934 million now totali= ng=20 $1.5 billion and the direct access charge backs for negative PX credits=20 increased $214 million now totaling $433 million.? PG&E's total default=20 amount is now $3.3 billion excluding amounts yet to be collected from PG&E= =20 customers for DWR purchases.=20 The SCE balance is as follows: The commercial paper obligation that is due = as=20 of March 8 increased by $260 million since January 31 for a total default= =20 amount of $401 million. SCE defaulted on a significant amount of long-term= =20 debt principal and interest roughly $249 million.? QF purchase defaults=20 increased by $354 million for the same five-week period now totaling $835= =20 million.? The ISO obligations decreased $1.1 million and the direct access= =20 charge backs for negative PX credits increased $21 million now totaling $2= 5=20 million.? SCE's total default amount is now $1.7 billion excluding amounts= =20 yet to be collected from SCE customers for DWR purchases.=20 There is little question that the QFs are taking it on the chin big time.?= =20 In the last five weeks between January 31 and March 8 the defaulted=20 payments to the QF owners from both utilities has increased $630 million.?= =20 The total QF default for both utilities as of March 8 stands at $1.5=20 billion.? Does anyone wonder why 1500 MW of QF capacity has shut down in=20 California?? Without these payments being made very soon I would expect th= e=20 amount of shut down QF capacity to easily double or more.? Why would these= =20 projects produce without the promise of being paid?=20 Things in the People's Republic of California=20 ?@@@ Be a Source for Energy Price Update=20 Art O'Donnell editor and associate publisher of the well-known and widely= =20 read California Energy Market (CEM) is looking for traders willing to=20 participate in his survey in exchange for receiving an advanced copy.? The= =20 Survey is a regular feature in CEM. The information collected by Art is=20 matched against the responses of the other people he interviews and some=20 posted sources (Pricewaterhouse Coopers BPA=01s daily offerings for=20 instance).? It is written up in narrative form. The report goes out twice= =20 weekly once on Wednesday afternoon/evening via e-mail as a courtesy to the= =20 respondents (because the week is pretty much done by then) and a rewrite o= n=20 Friday that is e-mailed around 10 am posted on the newsdata.com Web site= =20 and published in the newsletter for general consumption. The Friday report= =20 also features a brief story about natural gas markets in the West=20 The WPTF Board of Directors has allowed me to publicize this offering and = to=20 explain that if your company is interested in participating the informatio= n=20 you provide to Art would be protected as confidential.? In Art's words Th= e=20 price survey is =01( unlike some attempts at creating a tradable index numb= er=20 (e.g. McGraw-Hill=01s Power Markets Week index or the Dow Jones indices) = is=20 more of a narrative about the state of the market d a pulse reading as=20 opposed to a blood pressure number or an EKG. As such I do not ask traders= =20 and schedulers for precise dollar figures or volumes associated with specif= ic=20 trades but rather questions like 'What=01s Mid-Columbia going for today?= What=20 about off-peak? How has that changed since this morning? Oh yeah why is=20 that? Anything else I should know?'=20 The WPTF Board asked Art to explain how the information he collects would b= e=20 protected since so many marketers and generators are under State data=20 subpoenas.? Art replied The Constitution of the State of California=20 provides for a blanket immunity against government intrusions for news=20 gathering from confidential sources and unpublished information something= =20 which we believe in strongly at Energy NewsData Corporation and which we ar= e=20 willing to go to jail to protect. So if for instance the Attorney General= =20 tried to subpoena me or anyone from my staff about power price information= =20 we would 1) refuse to divulge anything other than the already published=20 accounts 2) send back a copy of the Constitution 3) contact the attorneys= =20 for the Society of Professional Journalists and 4) start preparing a benef= it=20 party to raise legal fees. =20 If you would like to participate in Art's survey please e-mail him at=20 aod@newsdata.com.=20 Things in the People's Republic of California=20 ?@@@ BPA Misquoted in the WSJ=20 In last week's Burrito I referred to a Wall Street Journal article that=20 portrayed a BPA trader as admonishing the DWR for accepting bids over marke= t=20 prices.? I was surprised when I received the following e-mail from BPA's=20 David Mills.? His message to me copied a letter he sent to DWR's Ray Hart= =20 explaining what he meant as opposed to what he was quoted as saying.=20 Dear Ray:=20 ?=20 As per our telephone discussion I just wanted to reiterate a few things=20 re:the Wall Street Journal article and the quotes attributed to me.? At no= =20 time during the interview with Ms Smith did I state that I thought that=20 CDWR's offers were out of line with the prevailing market price in Californ= ia=20 or that your traders should check that price before entering the market.? T= he=20 reporter was quite interested in the price difference between California an= d=20 the MidC price here in the Northwest and when I asked I told her that=20 currently that price delta was roughly $50-$100 MWhr with MidC being lower= =20 than the CA prices.? I did not indicate to the reporter that I thought that= =20 CDWR was paying more than the California market price and was simply trying= =20 to make a comparison of price relativity between California and the=20 Northwest.? Lastly BPA has on occasion charged extra-regional entities= =20 less than the prevailing market price but has only done so to remain=20 consistent with our own pricing strategies.=20 ?=20 ?I apologize for any misconceptions or miscommunications that may have=20 resulted from this and look forward to a continuing working relationship=20 between CDWR and BPA.=20 ?=20 Things FERC=20 ?@@@ Market Monitoring Proposal=20 FERC Staff issued a report with Recommendations on Prospective Market=20 Monitoring and Mitigation for the California Wholesale Electric Power=20 Market.? WPTF members are taking this proposal very seriously and we inte= nd=20 to provide comments on March 22.? If you are interested in a copy of the=20 report go to General members are able to participate along with the Board members and=20 other general members working on our response.? We have retained the servic= es=20 of Dr. Ben Zycher of the RAND Corporation to help us draft the policy=20 issues.? He will be working with our counsel Dan Douglass of Arter & Hadde= n=20 to craft our reply.=20 In short our submission will point out the flaws in FERC's proposed=20 methodology and demonstrate the shortcomings of narrowly limiting the=20 definition of producer marginal cost to operating variable cost.? Further= =20 excluding measures of credit worthiness are an important missing variable i= n=20 the FERC analysis.? Next week I will include a short summary of our respon= se=20 in the Burrito.=20 Letters=20 I received a note from one of our legal beagles that drop me a line every n= ow=20 and then.? I don't have the facts of the case to which this person refers= =20 but I hope the sender provides us with an update if a judgement should occu= r.=20 Universal Studios wants FERC to find that Universal owes no penalty to SCE= =20 for not interrupting its interruptible load (under a CPUC rate schedule)=20 because SCE did not adhere to the FERC requirement in the Dec 15 order to= =20 schedule 95% of its load in the day ahead market ...... according to=20 Universal if SCE had done so then it would have had to provide Universal= =20 power at below its cost.? SCE didn't and Universal got interrupted and now= =20 Universal owes $$$$$$$$$$$$$.? Does anyone else know about this filing?=20 Lind Guerry veteran of the PX halcyon days wrote Hi Gary.? Hope you're= =20 having a nice day.? Just wanted to let you know that I'm really enjoying th= e=20 Burrito and am so glad you're sending it to my home email.? I really got a= =20 kick out of the Ten Reasons....? It's hard to believe that our wonderful= =20 state is in such incompetent hands isn't it?? And not only are they=20 incompetent they continue to remain so with such regularity you could=20 probably make a killing marketing their incompetence as a laxative.? Do you= =20 think if we tried to do that we'd get accused of exercising market power?= =20 Think of the power we'd wield as the holder of the largest amount of=20 incompetence!! ?=20 Lind we need a product name for the laxative idea.? Any ideas? How about= =20 Sane Away?=20 Jobs and People=20 The folks at Dynegy sent me a couple of job postings.? If your company has= =20 similar posting or job openings or if you are reader looking for a new gig= =20 drop me a line.? After all it's free.=20 Position Description:=20 Dynegy's position has responsibility for the development of transmission an= d=20 power markets in a geographic region of the U.S.? Duties are driven primari= ly=20 by federal regional and state activities to restructure and deregulate th= e=20 electric power industry and the need for industry participants to develop= =20 and implement market structures policies and regulations that promote=20 liquid and competitive transmission and power markets.? Significant activit= y=20 within a region to reshape the structure and operation of the transmission= =20 grid is resulting from FERC Order 2000 which directs the establishment of= =20 Regional Transmission Organizations. Extensive travel (40%-60% and higher = at=20 times) is highly probable. Primary goals of this position are to:1) Create= =20 more liquid and competitive transmission and power markets? 2) Maximize th= e=20 value of Dynegy's positions and assets by working closely with the trading= =20 and power groups to develop?? and implement commercial strategies that crea= te=20 and capture significant business opportunities and 3) Provide timely and= =20 accurate information market intelligence and recommendations to clients. = 4)=20 Maximize the value of Dynegy's positions and assets by working closely with= =20 the trading and power groups to develop and implement commercial strategies= =20 that create and capture significant business opportunities and=20 recommendations to clients.=20 Interested parties should contact Jolly Hayden at jjha@ngccorp.com.=20 Odds & Ends (_!_)=20 First I would like to welcome WPTF's newest general member Wellhead=20 Electric.? Hal Dittmer is the founder and president of Wellhead.? I have=20 known Hal for a couple of years first as a client for my over priced=20 consulting services and later as a friend and source of all kinds of usefu= l=20 information.? Wellhead is one of those QF owners who are owed a boatload of= =20 money.? However Hal's company is developing some new projects and he is= =20 looking for prospective power buyers.? Hence his interest in WPTF is=20 obvious. Wellhead is WPTF's 31st member.=20 Well the Dynegy gang has been a source of comfort and joy to me this week.= ?=20 They couldn't let me leave their abode without stuffing a song in my pocket= =20 that is a tribute to their creative skills.? Timely too.? Sing it to the tu= ne=20 of California Dreaming by the Mamas and the Papas.=20 ISO California=20 (to the tune of Hotel California) On a dark Western highway=20 No wind in my hair=20 No rain for the hydro=20 No NOX in the air=20 Up ahead in the distance=20 I saw a flickering sight=20 The load grew heavy and the lights grew dim=20 No relief in the night=20 So we stood in the darkness=20 Down at the Taco Bell=20 And I was thinking to myself=20 This could be Heaven or this could be Hell=20 We lit up a candle=20 No power in the Bay=20 There were voices down the corridor=20 I thought I heard them say? =01(=20 Welcome to the ISO California=20 Such a lovely place=20 Such a lovely place=20 Such a lovely face=20 Powering up for the ISO California=20 What a nice surprise=20 What a nice surprise=20 Bring your alibis? =01(=20 Its mind is policy twisted=20 Can=01t stop consumption trends=20 Got a lot of NIMBY boys=20 Cisco calls friends=20 How we sweat in the courthouse=20 Sweet summer sweat=20 Without the AC=20 We try to forget=20 So I called up the Gov=01nor=20 Please energize this line=20 He said=20 We haven=01t built a new plant here since 1969=20 Last thing I remember=20 We were running for the door=20 We had to find the passage back to the place we were before=20 Relax said Judge Damrell=20 California=01s programmed to receive=20 Go belly up any time you like=20 But your power can never leave=20 ?=20 [refrain]=20 =3D=20 Don't refrain.? Have a great weekend y'all.=20 gba=20 ? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Draft Response to CPUC OII Body:: I have taken a stab at putting a draft response together indicating areas where we need more flesh. I will forward Tim/Mary's presentation to FERC EPSA's California Fact Sheet and the transcript from the hearing held on 8/23 and 8/24. Witness Wolak Market Surveillance Committee of ISO had some good points about rational behavior in markets with scarcity of supply. His comments were on 8/23. Please feel free to comment. Dan Douglass Arter&Hadden (818-596-2201) will be filing these comments on Enron's behalf which are due on Friday. I would suggest that Dan provide some of the legal view on whether the CPUC has adequate jurisdiction over retail rates not wholesale rates. We should shoot for final comments by 10:00 a.m. tomorrow if possible. This will allow an opportunity to discuss any last minute changes if necessary before filing. Seabron Adamson Frontier Economics (617-354-0060) will be providing additional drafting. Be sure to send any comments to these parties along with the internal list. Thanks. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Oakland Trib Wed 3/7: Breakthrough made in rescue of PG&E Bakersfield Californian Wed 3/7: El Paso Energy closes six valley power plants Contra Costa Times Wed 3/7: Still undecided: Who'll pay DWR for electricity SF Chron Wed 3/7: State Taxpayers In Dark on Details Of Energy Deal Sac Bee Wed 3/7: Lawmakers pitch fixes for region's energy woes Orange Co. Register Wed 3/7: Power plan called wrong LA Times - Wed 3/7: Bill to Cut Some Power Prices Stalls Sac Bee Wed 3/7: PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts SF Chron Wed 3/7: PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service San Jose Mercury Wed 3/7: Power prices could soar during the summer SF Chron Wed 3/7: Power Plant Plans Cause Conflicts East county residents blast supervisors Contra Costa Times Wed 3/7: Supervisors set search for power plant sites Sac Bee Wed 3/7: Peter Schrag: California's $90 billion infrastructure gap Contra Costa Times Wed 3/7: PG&E power plan debated at hearing SF Chron Thurs. 3/8: State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August WSJ Thurs. 3/8: Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals ------------------------ Breakthrough made in rescue of PG&E State ready to pay $7 billion for lines By Steve Geissinger SACRAMENTO BUREAU SACRAMENTO -- Signaling a breakthrough in secret energy crisis talks the Davis administration disclosed Tuesday it may announce the framework of a pact to rescue the teetering Pacific Gas and Electric Co. next week. Things are going very well said Steve Maviglio a spokesman for Gov. Gray Davis. The state appears to be poised to pay at least $7 billion -- and possibly billions more -- for PG&E's high-voltage transmission lines as part of a deal to financially renovate the north-state utility according to sources familiar with the negotiations. But consumer advocates insisted that even the $7 billion price is too much to pay. And experts warned that a deal with PG&E will be more complex than with other utilities. PG&E representatives declined comment in keeping with their policy on the talks even though the Davis administration said an announcement could come as early as next week or the following week. The new timetable for an announcement was substantially sooner than in Davis' original forecast. Until late last week PG&E was still resisting the sale of its power grid despite the fact that Davis had announced the framework of an agreement with Southern California Edison. Davis expects to soon announce a similar deal with the San Diego Gas and Electric Co. However any such deal still would need federal approval. The investor-owned utilities trapped between high wholesale costs and lower regulated retail rates amassed nearly $13 billion in debts and were unable to buy electricity this winter. With the onset of rolling blackouts the state began brokering billions of dollars in emergency short- and long-term power purchases. Davis' strategy to ease the energy price and supply crisis includes bolstering both conservation and generation while fiscally refurbishing the nearly bankrupt utilities. As part of the rescue deal the utilities would have to drop legal actions seeking dramatically higher electricity bills environmentally shield wildlands they own sell power from their generators to Californians for the next decade and secure help with their debts from their parent companies. Together with the cash infusion from the sale of their power 26000-mile power grids the utilities would be allowed to sell bonds to raise funds and use customer money to pay them off. The state would upgrade the high-voltage lines and lease them back to the utilities for operation. In a reflection of the negotiations with the three utilities a Davis administration official said the deal with PG&E is proving to be more complex than with the other firms. Though PG&E finally agreed late last week to sell its transmission grid the utility apparently wants more than the $7 billion that Davis has offered according to sources. The figure is more than twice the book amount or the value placed on the system for purposes of accounting. And that's the markup that lured Edison into an agreement to sell its smaller portion of the transmission grid for $2.8 billion. But PG&E which fears an erosion of its economic base may be asking as much as $10 billion. Due to complexities in the state's 1996 deregulation of the industry PG&E is more likely to lose revenue than Edison as a result of selling its transmission lines according to experts. Big customers might be able to bypass the utility's remaining local distribution lines thereby eroding its customer base. Therefore the utility may view bankruptcy and sale of its transmission lines to the highest bidder as a potentially attractive alternative to selling its share of the grid to the state at too low a price. ---- El Paso Energy closes six valley power plants Filed: 03/07/2001 By CHIP POWER Californian staff writer e-mail: ppower@bakersfield.com El Paso Energy citing non-payment from Pacific Gas & Electric Co. said it has shut down six cogeneration plants this week. The smaller plants produced about 175 megawatts of electricity and are located primarily in the San Joaquin Valley said company spokesman Mel Scott. A megawatt can supply power to 1000 homes. At least 10 plants have closed in the past two weeks as a result of non-payment according to the state Independent System Operator which manages most of the state's electrical distribution. The El Paso Energy plants are operated with various partners and had not been compensated for December January and February deliveries said Scott. He said he did not know the total amount due but said the plants would be closed until PG&E's credit worthiness is improved. A cogeneration plant common in oil fields simultaneously produces heat energy and electrical or mechanical power from the same fuel in the same facility. Typically it produces electricity and steam which can be deployed to enhance oil recovery. Kern County is the state's leading oil-producing county. El Paso owns or has interests in more than 40000 miles of interstate and intrastate pipeline connecting the nation's principal natural gas supply regions to the five largest consuming regions in the United States namely the Gulf Coast California the Northeast the Midwest and the Southeast. El Paso closed up 99 cents on Tuesday or 1.4 percent at $71.49. The Houston-based company's stock price has ranged between $36.31 and $75.30 in the last 52 weeks. ---- Still undecided: Who'll pay DWR for electricity By Karen Gaudette ASSOCIATED PRESS SAN FRANCISCO -- The price tag is $3.2 billion and counting for electricity bought by the state Department of Water Resources for the customers of two nearly bankrupt utilities. Pacific Gas and Electric Co. Southern California Edison and the state disagree over how the DWR eventually will be reimbursed for its purchases on the expensive last-minute power market. So do the state power regulators who have the final call over who gets the money when. Under a recent law the DWR went into the electricity-buying business to help keep the two utilities from sinking further into their $13 billion debt. The state plans to retrieve the money by selling $10 billion in revenue bonds. The utilities continue to collect ratepayer dollars on that electricity which the bill's author Assemblyman Fred Keeley D-Boulder Creek says is meant to help them begin paying down their debt. In a recent letter however DWR officials requested that the state Public Utilities Commission order that a portion of that money be diverted to the state. But after the utilities subtract the costs of generating electricity payments to environmentally friendly power plants and other expenses there is no money left from ratepayer dollars to give to the DWR without sinking further into debt PG&E spokesman Ron Low said Tuesday. If it passed along money to the DWR our undercollection would grow by about $2.4 billion by the end of the year Low said. The commission unable to agree on the best course of action left the issue untouched at its last meeting but expects to revisit the issue when it meets this morning. Commissioner Richard Bilas is proposing an alternate plan that would have the DWR set its own revenue requirements that would be passed on to ratepayers. The PUC also is expected to respond to complaints from laid-off workers and customers that layoffs by utilities to cut costs have been hurting service. Commissioner Carl Wood warned at the last meeting that failure to provide safe and reliable service could mean fines for the utilities. Representatives from electrical workers unions the PUC and the utilities were to discuss the issue Tuesday afternoon. I don't think we believe that utilities can find a way out of their problems by laying off workers said Mindy Spatt a spokeswoman with the Utility Reform Network. We think consumers deserve safe and reliable service and we think they deserve it at a reasonable price. ---- State Taxpayers In Dark on Details Of Energy Deal David Lazarus Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle Few people would purchase a car simply because the dealer said ''Trust me it's a great deal.'' Yet Gov. Gray Davis essentially is telling Californians just that about dozens of long-term power contracts. Because of confidentiality agreements with power companies the governor has revealed only scant details about the state's multibillion-dollar contracts for electricity over the next 10 years. Gov. Davis has our money and we can't see how he's spending it said Doug Heller a spokesman for the Foundation for Taxpayer and Consumer Rights in Santa Monica. We've been locked out of the room. Neither Davis nor power companies would divulge specific details about the price duration or scope of individual contracts. Each cited secrecy clauses that the governor's office said had been desired by both sides. What consumers do know is this: -- California has signed 40 contracts and tentative accords valued at about $40 billion to secure enough power to light 9 million homes over the next decade. -- The average purchase price of each deal is $69 per megawatt hour -- well above the $30 to $40 charged by power generators before California's energy market went haywire last summer. -- If as is widely expected wholesale power prices fall in years ahead the state nevertheless will be locked into paying above-market rates for electricity. But it is not known which generator agreed to part with the most power at the cheapest level or the full range of the prices in concocting the $69 average. Moreover it is unclear how shrewdly the state negotiated with taxpayer money in securing power on behalf of cash-strapped utilities. These agreements are the bedrock of our long-term energy policy Davis said Monday in announcing the deals. The governor's office defended the murky nature of the contracts yesterday. It's a business transaction in which private corporate information is included said Steve Maviglio a spokesman for Davis. That's the kind of information that never gets revealed. While additional elements of the contracts will be publicized in coming months he said the contracts themselves will remain a secret. You'll never see all the details Maviglio said. This did not sit well with many observers. It's a breach of public trust said Daniel Bacon a San Francisco attorney specializing in business law. A public servant spending public money shouldn't be able to keep the spending secret. But Gary Ackerman executive director of the Western Power Trading Forum an energy-industry association in Menlo Park called confidentiality agreements a necessary evil in transactions like this. He explained that no power company would agree to a long-term contract if rival firms could learn the terms of the accord. The company would be losing too much of its competitive edge in the marketplace Ackerman said. At the same time he noted that secrecy allowed the buyer -- in this case California taxpayers -- to secure more favorable terms with individual sellers. A high price with one generator would not necessarily be sought by all power providers. Still the fact that public funds are being used makes confidentiality in this case a different matter than say Cisco Systems' quietly negotiating to take over yet another tech rival. The public is in a very awkward position said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. It has to rely on the good word and expertise of the governor and he has yet to demonstrate that he has expertise or good word in this field. Shames likened consumers to passengers in a plane being flown by a pilot without a license to fly. But what choice do we have? he asked. I don't see many other options available right now. There's the rub. No matter how bad a deal California may have cut to help meet its energy demands the alternative -- blackouts disruptions economic catastrophe -- is far far worse. On the other hand it already appears that the new contracts will not shield Californians from the threat of daily outages this summer when demand surges. Davis said only about 60 percent of the state's summertime electricity needs so far had been met. Part of the reason is that many power companies already have contracted for their output this year. Duke Energy said this was why it would not begin its nine-year contract with California until 2002 while Williams Cos. said it would only gradually increase the amount of available wattage in its 10-year contract. Both companies meanwhile will continue to profit this summer by selling into the volatile spot market where wholesale power went for as much as $1 500 per megawatt hour last year. You can't sell all your power into long-term contracts said Paula Hall- Collins a Williams spokeswoman. You save some for the spot market. Consumer groups worry that consumers will be hammered again this summer with sky-high power prices and then get nailed down the road by contracts for above-market rates. If we could look at the terms of the deals we'd see that California is being gouged for 10 years said Heller of the Foundation for Taxpayer and Consumer Rights. But the governor doesn't want us to see that. Ackerman of the Western Power Trading Forum said the state had gotten the best rates it could under current market conditions. California went for long-term contracts when everyone else moved in as well he said. Californians are paying a price for not acting sooner. ---- Lawmakers pitch fixes for region's energy woes By David Whitney Bee Washington Bureau (Published March 7 2001) WASHINGTON -- California members of Congress pleaded for everything from wholesale price caps to extending daylight-saving time an extra hour to help the region cope this summer with its persistent electricity shortage but none of the ideas seemed to catch fire at a House hearing Tuesday. People will die in California because of this crisis Rep. Brad Sherman a Los Angeles-area Republican warned the House Energy and Commerce Committee. Sherman testified that his idea for saving lives is to extend daylight-saving time by an extra hour so that there would be more daylight at the end of the day when power consumption surges. One of the peak demand periods for electricity occurs between 5 p.m. and 8 p.m. when the sun sets and people come home from work Sherman testified. If people come home and it is light out there is less of an inclination to turn a light on. Sherman said the state Legislature has called for congressional approval for states to be given authority to extend daylight-saving time and he cited analyses by the California Energy Commission and other agencies suggesting that it could cut power consumption by 1 percent to 2 percent. Sherman who was one of about a dozen California lawmakers presenting their views on the energy squeeze drew no questions from committee leaders about what his legislation might do to everything from airline schedules to television programming if West Coast states didn't agree on the same time standard. Most of the committee's questioning was on the more popular idea proposed by several California and Western lawmakers primarily Democrats to require the Federal Energy Regulatory Commission to impose caps on wholesale electricity prices that have gone wild because of a regional power shortage. Rep. Bob Filner D-San Diego charged that the price spiral has little to do with power shortages but a lot to do with a small cartel of generators bilking ratepayers. Rep. Jay Inslee D-Wash. said he brought up the idea of regional price caps with President Bush who was initially skeptical. But Inslee said that Bush warmed to the idea after being told that protections could be built into the caps so as not to discourage construction of new power plants. Upon hearing that Inslee said Bush invited him to meet with the president's Cabinet-level task force led by Vice President Dick Cheney on a national energy strategy. But Inslee said he can't get the group to meet with him. It's very disappointing Inslee said. Tuesday's hearing was part of a series the panel is holding on the California crisis so far without any emerging consensus on what if anything Congress should do. ---- Power plan called wrong Wall Street analysts say the governor's approach to the problem avoids the issue that caused the imbalance. March 7 2001 By DON THOMPSON The Associated Press SACRAMENTO California's scramble to insulate consumers from the soaring price of electricity may add to the state's power problems this summer Wall Street analysts said Tuesday. Gov. Gray Davis' emphasis on buying utilities' transmission lines and negotiating long-term power contracts to help ease their debts skirts the deep imbalance between wholesale and market rates that led to the state's power problems in the first place they said. In the long run it doesn't solve anything said Michael Worms an industry analyst for Gerard Klauer Mattison & Co. In the long run you need to send the right price signals to consumers which will create its own conservation signals. Unfortunately customers were shielded from that in California. Davis said Monday that the state's first contracts to buy electricity for two financially struggling utilities will provide only about two-thirds of the power needed on a typical summer day forcing Californians to cut power use at least 10 percent to avoid blackouts. Since early January the state has been buying one- third of the power Southern California Edison and Pacific Gas and Electric Co. customers need. The two utilities denied credit by suppliers say they have lost nearly $14 billion due to soaring wholesale electricity prices that the state's industry-deregulation law says they cannot pass on to consumers. The keepers of the state power grid had enough electricity Tuesday to avoid declaring an electricity alert but have faced an almost-daily scramble for weeks due to a tight supply and high wholesale prices. Several wholesale and retail rate proposals are circulating. Among them: Free-market advocates such as Worms want an immediate end to the deregulation-imposed retail rate freeze on Edison and PG&E that will expire next year. Davis wants a Western price cap of $100 per megawatt hour on power generators he says have been prof iteering from California's short energy supply. The Bush administration and Federal Energy Regulatory Commission are cool to that idea. In December FERC imposed a soft cap of $150 per megawatt hour on wholesale rates in the state and required suppliers to justify any higher prices they charge. Consumer groups such as The Utility Reform Network or TURN want regulated rates for residential and small-business customers but free-market rates for large industrial customers which sought deregulation in the first place. TURN also advocates a tiered rate structure with higher rates for consumers who use more than a reasonable amount of electricity each month. Assembly Republicans say electricity and natural-gas prices will fall naturally if the state increases supply mainly by making it easier to build plants and pipelines. Right now you're sort of sitting partially with regulation and part with the free market said Paul Fremont an analyst with Jefferies & Co. Both these systems work. It's sort of that in-between system that you have in Califor nia that doesn't appear to be working. The system discourages generators from building new power plants because they aren't guaranteed a profit and it doesn't do enough to discourage power use by consumers because the price they pay doesn't reflect the true cost of power Fremont said. I don't think people here have much faith in the market and why should they? countered TURN's Mindy Spatt. I think there are probably better ways of encouraging consumers to conserve than by gouging them. Davis insists the crisis can be resolved without raising rates for Edison and PG&E customers beyond the existing rate structure. In January state regulators imposed temporary rate hikes of 7 to 15 percent on Edison and PG&E customers. The Legislature and Davis extended the increases for up to a decade to help pay back the estimated $10 billion in power buying the state expects to do for Edison and PG&E over the next several years and finance its purchase of the power lines owned by the two companies and San Diego Gas & Electric. Rates were already scheduled to increase next year for Edison and PG&E customers. Under the 1996 deregulation law the pair's ratepayers saw a 10 percent rate reduction but only until early 2002. That rate cut will likely expire as planned Davis spokesman Steve Maviglio has said. Davis wants those rates to cover not only the traditional cost of generating transporting and distributing power but the added cost of paying off the two utilities' massive debt and buying their transmission lines said Assemblyman Fred Keeley D-Boulder Creek the Assembly's chief power negotiator. Yet Davis has indirectly addressed the rate imbalance by signing legislation that will let regulators raise consumer rates if necessary Keeley said. The governor and lawmakers are in effect spreading out rate increases over a decade by using long-term revenue bonds to buy power for the nearly bankrupt utilities said Severin Borenstein director of the University of California Energy Institute. At some point we have to deal with the reality that all of the power that we buy has to be paid for by somebody - it's either going to come from taxpayers or it's going to come from ratepayers Bor enstein said. Raising rates now would get us a lot of conservation. Davis also wants financial incentives for conservation and power-plant construction in time to make a difference this summer. Our mouths were agape at the rapid timetable Keeley said. Legislators are rushing to pass those incentives by month's end he said allowing three months for consumers and suppliers to act before the heat of summer. Among bills considered Tuesday the Senate Energy Committee approved legislation to accelerate the siting of power plants. It also was considering a proposal to restructure rates for generators that use renewable energy to provide about 30 percent of the state's electricity. ---- Bill to Cut Some Power Prices Stalls Energy: Democrats balk at varying payment levels for alternative generators. By DAN MORAIN JULIE TAMAKI Times Staff Writers SACRAMENTO--Legislation aimed at cutting prices for more than a fourth of the power consumed in California stalled Tuesday as Democrats questioned why a few alternative energy generators--some of them campaign donors--stood to receive higher payments than others. Lawmakers working to unravel California's energy mess have been negotiating for weeks in an effort to cut the price paid to more than 600 generators of alternative power by more than half to below 8 cents a kilowatt-hour. Those alternative generators' contracts with utilities have shot up in recent months because of a rise in the price of natural gas. The cash-strapped corporations have suspended or made partial payments to the generators over the last few months causing many to shut down or reduce their outputs. But even as the lawmakers reached agreement that pushed the average price to near the 8-cent level per kilowatt-hour some generators would have received higher prices under the bill by state Sen. Jim Battin (R-La Quinta). Some of the generators that stood to benefit had donated to Battin's campaigns. One--Windtec Inc.--gave Battin a $20000 campaign donation in 1999. Others contributed from $3000 and $5000 last year. Battin acknowledged that he has received campaign contributions from some wind power generators but said there is no connection between the donations and the bill's provisions. It is illegal it is unethical and it's not how I do business he said. Battin noted that 25% of the state's alternative energy producers are in his district. As Democrats on the Senate Energy Committee blocked the bill Battin warned that some alternative energy producers might react to the delay by trying to force Southern California Edison and Pacific Gas & Electric into bankruptcy. We will be the cause of bankruptcy Battin said. That prompted Energy Committee Chairwoman Debra Bowen (D-Marina del Rey) to retort: I'm really tired of being threatened with bankruptcy. Alternative energy producers including those that use wind solar power biomass and other means produce 27% of the energy used in California. They sell the electricity to the utilities which in turn transmit it to retail consumers. But with the utilities facing multibillion-dollar debts the alternative energy producers under contract with Edison have not been paid since November. Scores of alternative energy producers supported the measure. Edison International and the San Francisco-based consumer group the Utility Reform Network opposed it. Michael Florio of the Utility Reform group said the deal could result in higher consumer prices an Edison representative said the same thing. Battin and Assemblyman Fred Keeley (D-Boulder Creek) worked out an arrangement with many of the generators. Keeley took the lead in the early negotiations and then turned to Battin to introduce the legislation SB 47X. Rather convoluted language would have allowed higher payments to a select few generators that produce electricity from wind and biomass. Most of California's wind suppliers for instance would have received about 6 cents per kilowatt-hour. But a handful of them about half a dozen wind farms--mostly in the Palm Springs area represented by Battin--would have received 7.8 cents. Battin contends that other wind producers receive additional payments that boost them to the same level as Windtec and others that would get the higher payments. They get the same deal Battin said of the handful of generators that would benefit from the provisions he added to the bill. In California's overall energy market the amount of money that would have flowed to the favored generators is minor. But the added prices that would have been paid to the generators would have translated to at least $19 million in the next five years to be absorbed by Southern California Edison customers according to one analysis. Also Tuesday more details were disclosed about another leg of the state's effort to escape from the energy crunch--the deals with large power generators to supply electricity to California for as long as 10 years. Those arrangements were announced by Gov. Gray Davis Monday as the bedrock of California's energy policy. But some consumer advocates warned that the deals could lock the state into excessively high-priced contracts. S. David Freeman the general manager of the Los Angeles Department of Water and Power and Davis' negotiator said that the state guarded against that by varying the time spans of its deals. About 6000 megawatts are expected to be available this summer about one-third of the energy needed by the state Freeman said. The amount of power under contract swells until more than 9000 megawatts are contracted in 2004 half of the needed amount before dipping to 8000 megawatts in 2010. What we're doing here is what everybody said had to be done Freeman said. We deliberately bought 50% so we'd have a good mix between long-term contracts which may turn out to be somewhat higher or somewhat lower than the spot market and purchases on the spot market. ---- PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts By Carrie Peyton Bee Staff Writer (Published March 7 2001) Sacramento's electric utility wants out of a deal that imposes rolling blackouts locally on PG&E's command. So do a lot of other utilities. They've been writing letters lobbying lawmakers and launching informal talks with Pacific Gas and Electric Co. to get off the hook before summer. Who dodges the blackout bullet is going to play out as a political hot button around the state said George Fraser head of the Northern California Power Agency a coalition of municipal utilities. In Sacramento the next volley is expected soon with the Sacramento Municipal Utility District reportedly poised to notify PG&E that it will no longer black out homes and businesses on the larger utility's command. We are absolutely trying to fight off the requirement for rolling blackouts for the Sacramento area said Linda Davis one of seven elected members of the SMUD board of directors. Saying they don't want to be dragged down by somebody else's problems two Southern California utilities have written grid operators asking to be exempted from any blackouts caused by PG&E's or Southern California Edison's financial woes. But in PG&E's view California is in an energy crisis (and) ... we're all in this together said spokesman John Nelson. The maneuvering comes amid bleak forecasts for power supplies this summer. Although Gov. Gray Davis has said conservation new power plants and moderate weather could avert blackouts officials at the Independent System Operator which runs much of California's grid expect frequent rotating outages. One consulting firm Cambridge Energy Research Associates predicts 20 hours of rolling blackouts during July and August and about 200 hours of especially intense calls for voluntary cutbacks. Before blackouts hit the jockeying over just whose lights air conditioners and assembly lines will be shut down is growing. The outcome could affect millions of people statewide. The state Public Utilities Commission is probing rolling blackout programs run by the for-profit utilities it regulates including PG&E and Edison. A PUC analysis has suggested that PG&E's program which currently exempts about 40 percent of its customers should spread the burden more broadly. For example it said 1.9 million homes and businesses are spared just because they share a circuit with a customer deemed essential. But not-for-profit utilities such as SMUD which answer to their own elected boards or city councils have other worries. Many have already lined up their power supplies for summer. Some have raised rates or are considering raising rates. Some have taken extra conservation steps. They think those preparations ought to give them leverage to ease blackout clauses in their contracts with PG&E. SMUD general manager Jan Schori is going to use every avenue ... any avenue to put pressure on including lobbying the ISO the governor and others said utility director Davis. The Northern California Power Agency a joint-powers authority that owns and operates power plants for municipal utilities has begun informal negotiations with PG&E to change blackout rules according to Fraser its top executive. It is preparing to write PG&E asking that its members be exempted from outages altogether. Failing that it wants them to face fewer outages or to be compensated for cutting off power he said. At SMUD the utility board has met in closed session to discuss exactly what it is required to do during electric emergencies under terms of the interconnection contract that links SMUD's lines to PG&E's. The contracts are being inspected with a fine-tooth comb said SMUD director Howard Posner. Schori declined to comment on any specifics. Sources indicated that the main option being considered is notifying PG&E that because of changed circumstances SMUD believes it no longer is required to routinely comply with outage requests. Other options being explored include re-negotiating existing agreements with PG&E. Posner said that ever since two days of rolling blackouts in January constituents have been asking him 'Why are we participating when we're not the problem?' And I don't have a good answer to that. Several directors said SMUD has already spent a lot of money -- and is considering 16 percent rate increases -- to ensure that it has enough electricity under contract to meet its customers' summer demands. They believe PG&E should do the same. We're almost like a David against Goliath here said board vice president Genevieve Shiroma. The huge investor-owned utilities next door have severe problems that they need to get under control. In addition SMUD plans to argue that because it can cut usage through its Peak Corps program which remotely turns off air conditioners at volunteer households it has already done its part without rotating outages director Davis said. PG&E believes the interconnection agreements that govern smaller utilities' ties to its transmission lines have benefits and burdens to both sides said Nelson. It wouldn't be fair or good policy for just one provision to be altered without taking a look at how that affects the entire contract he said. Interconnection contracts generally have clauses that require utilities to help each other out to avert greater emergencies. Sometimes reducing demand -- called load shedding -- can be the only way to stabilize the electric grid in the seconds after a major power plant or transmission line fails. It's been around in the electrical fabric forever said Jim Pope head of Silicon Valley Power Santa Clara's city-run utility. In addition to legal requirements you have a moral obligation so you don't bring the system to collapse. Like other city-run utilities Silicon Valley Power has a contract with PG&E that requires it to shed load during an electric emergency. But its contract allows it to work with big users to reduce their demand so no one has to be completely shut off. Such agreements formed long before deregulation when PG&E ran the north state's grid now are complicated by the 1997 creation of the state Independent System Operator. The ISO today runs pieces of the grid owned by PG&E Edison and San Diego Gas & Electric Co. If it believes power use is about to surge past supply potentially triggering a grid collapse across the western United States the ISO notifies the three utilities that they have to shed a certain number of megawatts. The big utilities meet that requirement two ways. They cut circuits to some of their own customers and they tell smaller connected utilities to cut a proportionate share. In Northern California about 80 percent of the outages are borne by PG&E customers and the rest by customers of SMUD and other municipal utilities and irrigation districts. In one sense we are all in this together. If SMUD were in danger of going down we would hope others would help us out said SMUD's Posner. But that's if we're in danger from circumstances beyond our control not from mismanagement or lack of financial wherewithal. It is unclear what penalties if any a utility would face for violating an interconnection agreement. In the long run the issue would be fought either in the courts or before the Federal Energy Regulatory Commission grid officials said. As a practical matter in the seconds when the risk to the grid is greatest if one utility refused to shed load the ISO would probably solve to problem by calling on PG&E Edison or others who are willing to make deeper cutbacks they said. ---- PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service Bernadette Tansey Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle State regulators are set to decide today whether debt-ridden Pacific Gas and Electric Co. and Southern California Edison can conserve cash by laying off thousands of workers and letting service standards slip. Union officials who protested the layoffs before the California Public Utilities Commission warn that if the cuts go through neighborhoods hit by power outages could stay dark for hours and more customers could face busy signals when they call about their bills. An administrative law judge agreed advising the commission in February to order the utilities to restore 725 positions already cut and block the elimination of an additional 2125 jobs. Judge John Wong said PG&E and Edison have acknowledged the layoffs will not substantially improve their shaky financial condition which arose from skyrocketing wholesale electricity costs the utilities could not pass on to consumers under a rate cap. The savings would barely make a dent Wong said in his draft decision. The two companies together claim that their debt from power purchases amounts to more than $13 billion. PG&E says it has saved $18 million from the first wave of 325 layoffs. Wong's recommendation is already running into resistance on the PUC. Commissioner Richard Bilas said the five-member panel should not be micromanaging the utilities in a time of crisis. Bilas has proposed an alternate ruling that would allow the utilities to make the cuts but provide for PUC monitoring of service in case the commission wants to step in later. We're in a situation where the utilities are not collecting the revenues they need to operate and yet we may be guilty of not letting them cut expenses where they can cut expenses Bilas said. PG&E spokesman Jon Tremayne said savings from the layoffs are helping to keep electricity running and gas flowing. It keeps cash in our accounts so we can keep doing day-to-day business Tremayne said. In addition to the 325 positions dropped so far PG&E is proposing to cut an additional 675 during the next three to six months. The cuts affect temporary and contract workers who read meters handle new service hookups and replace equipment. PG&E has no plans to eliminate permanent positions. The company is struggling to keep up with a higher workload at its call center as customers deluge the lines with inquiries about their rising bills and the effects of deregulation. Calls to PG&E ballooned from 1.3 million in January 2000 to 2.3 million in January 2001. Bilas advocates granting PG&E's request to temporarily relax standards requiring the utility to respond swiftly to customer calls and to read customers' meters once a month. PG&E wants to read meters bimonthly and send bills based on the estimated use between readings. Discrepancies could be corrected later. Wong called those measures unacceptable. He said customers need to know immediately if their efforts to conserve power are working. Wong also said the utilities' own experts have said the workforce reductions will lengthen the time required to restore power after nonemergency equipment failure. Eric Wolfe communications director for the International Brotherhood of Electrical Workers Local 1245 said some customers have already been left without power overnight because PG&E is trying to avoid the use of overtime on nonemergency power outages. It hurts a lineman to walk away from the job leaving a customer without power Wolfe said. Tremayne said PG&E is trying to minimize overtime costs but denied the company has allowed customers to go without power out of financial concerns. He said crews were pulled out when darkness and falling trees made the work too dangerous. ---- Power prices could soar during the summer Posted at 10:35 p.m. PST Tuesday March 6 2001 BY STEVE JOHNSON Mercury News Unless Gov. Gray Davis arranges significantly more long-term electricity contracts or persuades people to turn off a lot more lights California's unpredictable spot market for power could wreak havoc this summer. Even with the 40 long-term deals announced by Davis on Monday experts interviewed Tuesday said up to 43 percent of the state's daily needs may have to come from this highly volatile market in which power is bought within a day of need. That could could prove hugely expensive because some spot market energy has cost five to six times what it would under the long-term contracts. It's widely expected that consumers ultimately would have to pay that tab which could amount to billions of dollars. And because that power won't be locked up in contracts there is no guarantee it will be available when it's needed which could lead to blackouts according to a recent report to the California Independent System Operator which oversees three-fourths of the state's power grid. ``The situation in California could reach catastrophic proportions'' the report concluded adding that unless things change dramatically ``it is a virtual certainty that peak demand will go unmet during many hot summer days.'' Steven Maviglio Davis' press secretary conceded Tuesday that the spot market could be troublesome. ``It's a major concern'' he said which is why the state is trying to line up more power contracts speed up power plant construction and promote conservation. During the normally hot month of August peak daily demand for power in the Independent System Operator's territory is expected to hit about 47700 megawatts -- enough for nearly 48 million homes. The state's three main utility firms generate about 8200 megawatts and have long-term contracts from wind solar and other energy sources for about 11700 megawatts more. That totals about 20000 megawatts. Add in the 7000 megawatts of long-term power that Davis has announced for this summer and the state is still nearly 21000 megawatts short. Costly proposition If all that power has to be obtained on the spot market the price could be high. On Friday last-minute purchases on the market averaged $411 per megawatt-hour compared to about $150 per megawatt-hour for all power obtained by the Independent System Operator and $69 per megawatt-hour on average under Davis' long-term contracts. It's possible that not all 21000 megawatts would have to be purchased on the market. Assuming Davis is successful in getting people to save 10 percent -- which could prove difficult -- conservation could reduce peak demand by nearly 5000 megawatts. California also might be able to trade for another 5000 megawatts with the federal government's Bonneville Power Administration and a hydroelectric operator in British Columbia said Arthur O'Donnell editor of California Energy Markets a trade publication. Under such deals those two outfits often send that much power to California when they don't need it and California returns the same amount or more when its demand is low. But O'Donnell said it wasn't clear whether 5000 megawatts would be available this summer because ``they still haven't gotten the snowpack they need in the Pacific Northwest'' which could limit that region's generating capacity. Still falling short Even if those hydropower imports are available and conservation works as Davis hopes it's likely California would still require the spot market for 11000 megawatts to meet the August demand. That's more than 20 percent of the state's overall power needs. ``All of the surrounding states are buying probably less than 5 percent at most of their energy on the spot market'' said Frank Wolak a Stanford economist who monitors electricity prices for the Independent System Operator. He worries about how much that power could cost and is disturbed that state officials haven't adequately addressed the issue. ``No one has any idea what they are going to do and that is part of the problem'' he said. Officials at Pacific Gas & Electric Co. are particularly concerned. They fear that their company -- which is nearing bankruptcy -- could get stuck for much of the spot market purchases by the Independent System Operator which has threatened to bill the utilities for the cost. Fearing the annual bill for that power could hit $2.4 billion this year PG&E wants the tab sent to the Department of Water Resources which also is buying power on the spot market for the state. But the Department of Water Resources has objected to that idea and the matter is expected to be heard today by the California Public Utilities Commission. ``We're looking for clarity on a number of issues'' regarding how the spot market will work ``and certainly that's one of them'' said Thomas Hannigan the water agency's director. ``I don't think anybody knows the answer of who's going to pay for it'' added PG&E spokesman John Nelson. But Nettie Hoge executive director of the Utility Reform Network in San Francisco said she suspects consumers ultimately will foot the bill. The unfortunate likelihood about spot market purchases is that ``ratepayers are responsible for all of it eventually'' Hoge said. ``It's a very big problem.'' ---- Power Plant Plans Cause Conflicts East county residents blast supervisors Jason B. Johnson Chronicle Staff Writer Wednesday March 7 2001 Industry dreams of building new power plants in east Contra Costa's hills are prompting an angry reaction among residents and elected officials who say they don't want more plants. The conflict was sparked by a vote by county supervisors yesterday to aggressively explore possible sites for new power plants throughout the county. The measure by Supervisors Mark DeSaulnier and Federal Glover which passed on a 4-to-0 vote directs the county administrator and Department of Community Development to compile a report on possible sites within 45 days. Supervisor Donna Gerber abstained after criticizing the plan for potentially repeating the same mistakes that plagued the state's energy deregulation effort by not considering how much energy the state region and county will need in future years and how much power is slated to come online. Gerber said alternative power sources such as solar should also be examined. A site drawing much attention is on top of a deposit of natural gas near the Concord Naval Weapons Station off Highway 4. The owners of 70 acres of land near the station recently formed a company Golden State Power Co. to pursue construction of at least one small peaker plant and a much larger facility capable of producing 600 megawatts. The site could hold up to three small 50-megawatt peaker plants and a larger 15-acre natural gas plant said Steve Thomas managing partner with Golden State. No land use applications have been filed. Thomas said 30 acres could be kept as open space to form a buffer around the project. Both (facilities) are state of the art said Thomas. We believe that the site is ideal. But east county residents at yesterday's meeting blasted the supervisorial measure and the power plant proposal complaining that more plants could put people's health at risk. The region already is home to six power plants. We're going to get a good dose of poor air quality and (negative) health conditions from this said Concord resident Evelyn Frietas. I think we need to stop and think about what we're doing to our quality of life. Dan Torres said the home he bought in 1995 at a new Bay Point development would be alarmingly close to the proposed Golden State site. It will be dragging emissions over our home said Torres. I didn't buy a home on that hill to be surrounded by power plants. There are six power plants in operation in east Contra Costa. Pittsburg already has two power plants and two more under construction. City Council members Frank Aiello and Yvonne Beals said the Antioch-Pittsburg area has done more than its share of energy production. Aiello said Pittsburg will soon produce enough energy to power three million homes in California. When is enough enough? asked Aiello. Pittsburg has shouldered responsibility for a land-fill and two more power plants. At some point you have to say enough. Beals said that while power plants have added millions to the city's general fund the negatives of additional plants could outweigh the benefits. I don't think that Pittsburg or east county should be the dumping ground for energy for California said Beals. ---- Supervisors set search for power plant sites The board also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord By Thomas Peele TIMES STAFF WRITER MARTINEZ -- Contra Costa County supervisors took tentative steps Tuesday toward allowing the construction of at least one small power plant before summer ordering that its staff identify potential sites in unincorporated areas within seven weeks. The board voted 4-0 to search for locations. Third District Supervisor Donna Gerber abstained saying her colleagues lacked a comprehensive context'' to identify sites. I think the board knows just enough to be dangerous'' she said. Gerber said the county should examine the potential for additional power plants within its borders but not investigate individual sites yet. But Fourth District Supervisor Mark DeSaulnier said the action was necessary because of the energy crisis and because of Gov. Gray Davis' call for local governments to help speed the construction of so-called peaker plants before July and August. I wouldn't do this except under an emergency DeSaulnier said after the vote. There are unusual circumstances. We're not talking about putting this in a residential area. Fifth District Supervisor Federal Glover backed DeSaulnier but said he hoped for a location outside his heavily industrialized East County district. There's a lot of concern in East County as to the number of plants he said. DeSaulnier said though that the only logical place for a small plant remains the industrial belt'' stretching along the waterfront from West County to Antioch. He declined to provide specifics but said the only other potential site outside the industrial areas was the Concord Naval Weapons Station property. But he quickly added that he believes the U.S. Department of Defense would never go for it. Also DeSaulnier said he could not rule out the county building the plant itself and entering the electricity-selling market during peak demand times. Board Chairwoman Gayle Uilkema called that idea extremely premature and unlikely. That's a very powerful decision. I do not think we are ready'' she said. The California Energy Commission listed the Equilon refinery in Martinez as one of 32 potential peaker plant sites in the state last week. Peaker plants kick in during peak usage times. Davis called for their quick construction before the height of summer and its energy demand for air conditioning. Plants that generate as much as 50000 megawatts don't need Energy Commission approval. DeSaulnier said he believed a peaker plant could be built about a month after final approval. Supervisors also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord. Walnut Creek commercial real estate developer Steve Thomas announced his intentions for the site north of Highway 4 last week. Construction could take two years. Eric Hasseltine a consultant representing Thomas and what he described as a brand new company for the site the Golden State Power Co. told supervisors that if they intended to speed peaker plant construction they should do what they can to expedite the larger plant. The Thomas site could house a peaker plant until the proposed larger one goes online. A large natural gas line passes under the site. DeSaulnier seemed cautious about the larger proposal which he had described last week as a good site. Uilkema too said she knew too little about it to comment. A resident who lives near the Thomas property asked the board to build it (the larger plant) closer to where you have industrial areas. You have to carefully consider the people who live nearby said Dan Torres 39. Evelyn Freitas of Concord said she lives downwind of the proposed site. Our air quality is going to be worse then it is now she said. Gerber played on the environmental issues saying the county already ranks second statewide to Los Angeles in volume of hazardous materials and amount of electrical generation. ---- Peter Schrag: California's $90 billion infrastructure gap (Published March 7 2001) By now California's surreal energy mess has grown from a crisis to a condition. It may not be quite as permanent as say death and taxes but it's still something that could get a whole lot worse before it gets better. Until there's more realistic pricing no gubernatorial pea-under-the-shell buyout scheme will solve it. Beyond the energy crisis however and in many ways similar to it California faces a whole range of other infrastructure problems -- in transportation in water resources and sewer systems in school and university buildings -- that seem once again to be all but forgotten. The Business Roundtable has estimated the need at roughly $90 billion though no number can possibly be exact. What's certain is that after a burst of high-level investment in public facilities during the 1950s and 1960s California's annual capital investment has sunk precipitously -- from an annual $150 per capita in the 1960s according to a set of recent studies for PPIC the Public Policy Institute of California to about $30 in the 1990s. But you probably don't need to tell anyone driving Bay Area or Los Angeles freeways or looking at the ubiquitous portable classrooms those dreary brown boxes that house a fourth of our public school students. Ever since passage of Proposition 13 in 1978 we have been flying the flag of deferred maintenance. As in the state's electricity crisis however there's no way California can effectively address those problems merely by building or bonding itself out of them. In highway construction in developing water resources in finding enough university space to accommodate the Tidal Wave II of students managing demand is likely to be as crucial to any solution as new construction. In the energy market -- and in electricity particularly -- it's been a familiar principle ever since David Roe of the Environmental Defense Fund first persuaded Pacific Gas and Electric that a dollar invested in conservation may be worth as much as the same investment in new generation. But in most other sectors of California's infrastructure state and local it's a lesson still to be learned. There have been scattered attempts to encourage conservation and reduce demand -- significant reduction in water use for example through the installation of low-flow faucets and low-flush toilets some reduction in traffic by using rush-hour diamond lanes or by adjusting highway or (as in New York) bridge tolls to levels of congestion. But as pointed out by David Dowall an urban economist at Berkeley state policy-makers have not really begun to consider how demand management strategies can be applied to infrastructure service areas or how the more efficient use of facilities and more realistic pricing -- highway tolls say or parking fees -- can reduce demand for scarce infrastructure resources. In any case says Dowall in one of the PPIC reports we should pick which major projects we will build not just according to per capita estimates of how much we need but according to how much consumers are willing to pay for them. To avoid hurting the poor congestion-related highway tolls and other tariffs can be rebated on the basis of income. University fees can be means-tested. In California they also could be adjusted to encourage summer school classes and other off-peak uses rather than (as in the past) making UC summer courses more expensive. Given the political and economic uncertainties there's no way to know how far such demand management can be taken. But there's not much doubt that as Dowall and others point out the state's infrastructure planning is a jumble of uncoordinated agency agendas and wish lists. The Legislature last year passed a bill AB 1473 by Assembly Speaker Robert Hertzberg that requires the governor beginning next year to submit an annual five-year infrastructure plan for state agencies and public schools along with recommendations on how to fund it. In addition Gov. Gray Davis' infrastructure commission is expected to recommend better coordination of infrastructure and land-use planning when it issues its report this spring. That would be a start. As California State Treasurer Phil Angelides has pointed out the state desperately needs to start joint planning -- regional planning -- for housing roads and other resources to reduce the need for long commutes to preserve open space and to bring jobs to where people live and housing to where the jobs are. That would itself reduce demand for more freeway lanes and equally important improve the quality of life. At present most planning for housing roads water systems and other facilities rarely recognizes the regional impact of local decisions. In the East Bay slow-growth forces push well-intended initiatives that would force more development into Tracy or Modesto and further tax the transportation systems to Silicon Valley. In city after city there are beggar-thy-neighbor efforts to grab yet another shopping mall that produces a little extra sales tax revenue for the city that gets it and that often compounds traffic and revenue problems in adjacent communities. In higher education we divide bond proceeds evenly among UC the California State University and the community colleges even though the community colleges serve eight times as many students as UC. We plan road projects according to county not regional priorities. It is all done according to antiquated political and fiscal formulas that often no longer make sense. We don't just need better capital planning we need a whole new planning system. ---- PG&E power plan debated at hearing A PUC meeting on the utility's capacity expansion project for the Tri-Valley follows weeks of protest from officials residents Power upgrade in valley debated By Megan Long TIMES STAFF WRITER SAN FRANCISCO -- Dublin officials and the developer of a Livermore subdivision faced questions Tuesday about their opposition to alternative routes of PG&E's controversial Tri-Valley power upgrade plan -- and answered by restating their long-standing objections. Tuesday's cross-examination came during the third and likely final week of the California Public Utility Commission's evidentiary hearings on the utility's $91 million Tri-Valley 2002 Capacity Increase Project. It has followed weeks of protests of PG&E's upgrade plans by officials and residents of Livermore Pleasanton Dublin and San Ramon. And before the questioning started Dublin Vice Mayor Janet Lockhart reiterated concerns about an alternative route deemed environmentally superior that would place a substation just 1000 feet north of Interstate 580 between Tassajara and Fallon roads. She said that would undermine the results of a 15-year process to plan the eastern development of the city. It's extremely important to the residents of our community to follow a plan we worked hard to produce she said. Dublin officials favor PG&E's proposed placement of the station three miles north of the freeway away from new high-tech company offices and housing developments. Besides the Dublin substation the project calls for construction of a substation in North Livermore expansion of the Pleasanton substation and installation of 23.5 miles of new lines. In response to questions from PUC Administrative Law Judge Michelle Cooke Dublin's public works director Lee Thompson confirmed that the Lin family the owner of the property where the alternative substation would go wasn't interested in selling the land to PG&E. Cooke also asked Thompson to define a discretionary permit which is how city officials said they might treat a permit for a substation. Lee said that type of permit is one the city has the right to approve or not depending on the project's impact. Eddie Peabody Dublin's community development director testified that the zoning for the Lin property accommodates uses such as commercial business research and development and light manufacturing. It would not he said be appropriate for a power substation. He said parcels within the East Dublin area that could host a station would include those zoned for public and semi-public uses including land recently bought by Oracle and Sun Microsystems for new campuses. While Dublin officials testified that one buyer of land in that area paid $86 per square foot others suggested land prices would be inflated to help make a PG&E land buy look prohibitively expensive. An executive of Centex Homes the developer of new houses near Isabel Avenue and Concannon Boulevard objected to an alternative route that would place high-voltage transmission lines overhead along Isabel and Stanley Boulevard. David Barclay president of Centex's Northern California division said that the 80-foot to 150-foot towers would have a severe visual impact on residents of the Prima tract. Ed O'Neill a lawyer for the Kottinger Ranch Homeowners Association pointed out that existing distribution lines on 50-foot poles on Isabel already mar the view for residents. The Foley family has been ranching on land south of Pleasanton city limits for years said their attorney Kennedy Richardson. The utility's project would place overhead lines and a transmission station on rolling hills that the family envisions as one day being public open space with limited development Richardson said. Lawyers for Pleasanton Livermore Kottinger Ranch and Centex are scheduled to cross-examine a PG&E engineer today about the project's routing. That testimony should be the most controversial of the hearings. Judge Cooke is expected to recommend an alignment by July to the PUC which will make the final decision. ---- NEWS State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August Marshall Wilson 03/08/2001 The San Francisco Chronicle FINAL Page A.20 (Copyright 2001) State energy officials yesterday approved plans to build a temporary electrical plant at San Francisco International Airport that should generate enough juice to power 50000 homes by August. Meeting in Sacramento the Energy Commission voted 4-0 to give the green light to the gas-fired plant. It will operate during peak summer and winter demand to help the state avoid Stage 3 power alerts and rolling blackouts. Texas-based El Paso Merchant Energy Co. won approval under a new state law mandating speedy four-month reviews of so-called peaker plants. It was the only one of seven applications statewide to win approval. The other proposals were withdrawn for various reasons. The 51-megawatt plant formally called the United Golden Gate Power Project is scheduled to be built at the northwest corner of the airport near the United Airlines maintenance center. Within the next few weeks El Paso plans to apply to build a 571- megawatt $400 million plant in the same area company spokesman Jesse Frederick said. It would undergo a separate review by state energy officials. The small peaker plant approved yesterday is to generate electricity beginning around Aug. 1 for up to three years. After the end of three years the plant would be closed or converted to a cleaner-burning system. Under state law a temporary peaker plant is permitted to spew more air pollution than a permanent plant. El Paso's temporary plant is to be built next to a co-generation plant operated by United Airlines. It would use existing connections for natural gas and water supplies and tap into existing power transmission lines. Electricity generated by the plant would be pumped into the state's electrical grid Energy Commission spokesman Gary Fay said. It would also serve as a backup for San Francisco Airport in case of a blackout. No one spoke against the proposed plant at yesterday's commission meeting. The proposal however has been criticized by area residents and environmentalists worried about air pollution. Scott Buschman a professional photographer and San Bruno resident said yesterday it was unjust that state officials 100 miles away in Sacramento approved a Texas company's proposal to put a power plant on land owned by San Francisco. The fact that they approved it without considering the public's concerns foremost air quality is very disturbing he said. Fay said the plant complies with clean-air standards. Answering the criticism about the location of yesterday's deliberation he said three hearings and several workshops were held in communities near the airport. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. ---- Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals By Wall Street Journal staff reporters Rebecca Smith Mitchel Benson and John R. Emshwiller 03/08/2001 The Wall Street Journal A1 (Copyright (c) 2001 Dow Jones & Company Inc.) SACRAMENTO Calif. -- Earlier this year Gov. Gray Davis made what may be the biggest bet in the history of the nation's biggest state: that he could tame an out-of-control electricity market and avoid devastating blackouts without busting the state's budget antagonizing its consumers or derailing his own political career. His wager is still on the table but the assumptions that underlie it are looking increasingly shaky these days. The governor has already spent around $2 billion of public money buying hugely expensive wholesale power taking over the role formerly played by the state's near-bankrupt electric utilities. And California will probably be obliged to spend billions more before its electricity market stabilizes and those utilities are restored to some semblance of financial health. Under the governor's plan California aims to recoup the money it is using to buy electricity by issuing $10 billion in bonds. That way it would still have a healthy budget surplus to finance new spending on roads schools and other public services. But there's a potentially big obstacle to this plan. The state Legislature worried about racking up billions in new debt has put limits on the size of any bond offering. In broad terms the Legislature's action would allow the state to borrow only four times as much as it can recover annually from utility customers. Right now that doesn't appear to be much. Under the current rate structure essentially set in place by California's flawed 1996 electricity-deregulation plan consumers pay far less for power than the cost of acquiring it on the wholesale market. Preliminary estimates submitted by utilities last month to the California Public Utilities Commission show the state's share of the proceeds from electricity sales this year could be as little as $241 million -- not enough to support even $1 billion in bond sales under the Legislature's formula. That would leave the state on the hook for much of the money it has already paid for power -- not to mention the billions more Gov. Davis will need to spend. That in turn raises the prospect that California's economy and its credit rating both could deteriorate significantly. But state finance officials say that based on their own projections they will be able to extract enough money to support a $10 billion bond issue. Walking a careful line between fiscal prudence and political survival Mr. Davis and others in his administration are scrambling to come up with ways to get around the legislative restrictions without raising rates for consumers. If I wanted to raise rates I could solve this problem in 20 minutes Mr. Davis says. The governor says he believes that the state can obtain enough affordable power through long-term power-supply contracts to avoid the need for a big rate increase. The billions of dollars the state hopes to borrow would be used to help pay for power until electricity prices drop as they are expected to do when new power plants come online over the next few years. The Davis administration fears that what may be its only other option -- a big increase in retail electric rates -- could prompt angry consumer groups to seek new electricity laws through a statewide ballot initiative during next year's election. That's when Mr. Davis is expected to run for a second term as governor. But trying to save California without rate increases is forcing Mr. Davis to make some colossal gambles with the state's money. State officials estimate that in the next several months California will need to spend as much as $6 billion on power purchases -- equivalent to the state's entire fiscal surplus. Mr. Davis is also looking to spend several billion more to buy the transmission assets of three investor-owned utilities in order to restore two of them to credit-worthiness. He also has announced plans to spend several hundred million dollars more on conservation programs designed to reduce demand while new power plants are being built in the state. In order to limit the state's financial exposure in the meantime the governor and his aides have in some cases ignored state law. They have threatened appointed officials who have stood in the way. And they have sharply restricted the flow of information to the public. None of those steps is expected to do much to reduce state spending on power in the coming months. In a few weeks power usage is expected to begin a sharp seasonal rise as Californians switch on their air conditioners with the coming of warmer weather. By various estimates demand during peak periods this summer could outstrip supply by 10% or several thousand megawatts. That could produce more rolling blackouts like the ones that hit Northern California earlier this year. It is also likely to put strong upward pressure on wholesale electricity prices. Steven Zimmerman managing director of Standard & Poor's Corp. says Mr. Davis and his aides don't have a lot of time to put a cap on the state's financial exposure to the crisis. The credit-rating agency has put the state on credit watch for a possible downgrade which would affect the value of all of California's outstanding public debt. Moody's Investor Service Inc. is also concerned. It said in a recent report that the power crisis could soon seriously threaten the health of the state's economy. Mr. Davis a Democrat and career politician was dealt a bad hand when he took office in 1999. The deregulation plan that sparked the state's electricity crisis was enacted under his predecessor Republican Pete Wilson. But Mr. Davis was slow to react to early signs of trouble this past summer and alarms sounded by members of the state Legislature. By the time Mr. Davis finally sprang into action earlier this year a troublesome power-supply squeeze had escalated into a crisis. In a Jan. 17 declaration of emergency the governor designated the state Department of Water Resources to take the utilities' place as the daily buyer of huge quantities of electricity. His hope: that by making the state the dominant player in California's power sector he would ease electricity producers' concerns about getting paid and give the state enough clout to negotiate lower long-term power prices. Earlier this week Mr. Davis announced final or tentative agreements with 20 power suppliers to furnish the state with a total of 8900 megawatts for periods of as long as 20 years. But the supply situation remains extremely uncertain for this summer when demand probably will top 45000 megawatts. If the state can secure enough power under contract and push down demand through aggressive conservation it might be able to squeak through the summer season. If not it will be forced to keep buying huge amounts of costly power in the cash market. Under deregulation retail electric rates were frozen for several years while wholesale-power costs were free to fluctuate. When the plan was conceived wholesale prices were low and expected to go lower. However a combination of unexpected growth in power demand and a lack of new generating capacity helped produce a supply squeeze. Average wholesale prices more than tripled last year from 1999. And in January those prices were up 10-fold from a year earlier. By then California's two biggest investor-owned utilities -- the Pacific Gas & Electric unit of PG&E Corp. and the Southern California Edison subsidiary of Edison International -- faced imminent financial collapse. They had racked up billions of dollars in wholesale power bills they couldn't afford to pay. As generators began shying away from selling to the two utilities the Clinton administration forced them to sell power into the California market an order left in place during the first weeks of the Bush administration. Still northern California was hit by rolling blackouts on several days in early January. Since then the DWR which does some electricity trading as an adjunct to its main mission of managing the state's giant system of aqueducts and reservoirs has had to learn the ins and outs of power markets on the run. It hasn't been easy. David Mills trading-floor manager for the federal Bonneville Power Administration says the water agency has at times offered to pay $50 to $100 per megawatt hour more than the available market price. They agree to prices that make you wonder says Mr. Mills whose organization markets electricity from federal dams in the Pacific Northwest. You'd at least think they'd check to see what the prevailing price is before throwing out their offer. Mr. Mills says that to cut California some slack he occasionally has instructed his traders to sell at prices lower than the DWR had offered to pay. Ray Hart the water agency deputy director responsible for the power purchasing says he isn't aware of any cases in which the DWR has overpaid. He says his team has been extremely successful by all measures. Ultimately the DWR's trading acumen is far less important than the overall arithmetic of power supply and demand in California. With the price of natural gas that feeds many of the region's generating plants at near record levels and some suppliers reluctant to sell into the troubled California market wholesale electric prices remain stubbornly high and in recent days have again been rising. The Legislature has advanced the DWR about $3 billion from the state's general fund for power purchases. Under emergency legislation passed by the Legislature and signed by Mr. Davis on Feb. 1 the general fund is to be reimbursed from a planned bond sale later this year. But under terms of the emergency law the water agency would have to wrest $2.5 billion a year in revenue from retail electricity rates in order to sell the $10 billion worth of bonds sought by Mr. Davis. Assembly Speaker Robert Hertzberg a Southern California Democrat says the formula was created to ensure that there would be a way to repay the bonds without draining the state's coffers. We didn't want to just open our wallets he says. According to the language of the Feb. 1 law the water agency gets what's left of revenue collected from ratepayers after the utilities pay certain of their own power-supply bills and other expenses. And in their filings with the PUC last month the utilities reckoned under their worst-case scenarios that there would be only $241 million available to the DWR this year. State officials are quietly pushing the PUC to rejigger the formula so that the water department gets more money -- even though that would clash with terms of the Feb. 1 law. Robert Miyashiro deputy director of the Department of Finance says the emergency law was drafted poorly and has led people to believe the DWR only gets the leftover money. He predicts there will be cleanup legislation. At the request of the Davis administration the PUC is considering a plan to use a different revenue-sharing formula than the one in the state law. The proposed new formula was written in close consultation with Mr. Davis's Finance Department says PUC President Loretta Lynch who supports the initiative and is hoping to rush it through. The effort has drawn some opposition. Commissioner Richard Bilas at a recent PUC meeting questioned the legality of the commission attempting to change a formula set by the Legislature. PG&E is even more emphatic since the DWR's extra money could come at the utility's expense. The formula threatens to undo the very financial protections for the utilities that [the new law] attempted to provide the utility said in a recent filing with the PUC. As politicians and regulators wrestle with that issue the Davis administration has taken a step to reduce the outflow of state cash that also seems to conflict with the Feb. 1 law. It was widely assumed that the law required the DWR to buy any electricity the state needed to keep its lights on. However on many occasions the DWR has refused to buy power on the grounds that it was too expensive citing a portion of the new law that urges the agency to hold down costs. The task of covering any remaining shortfall has passed to the California Independent System Operator which manages the state's energy grid and is charged with buying power when necessary to avert shortages. However the ISO doesn't have any power-purchasing money of its own and the major parties it would normally bill are PG&E and Edison whose inability to pay their power bills was the reason the state started buying electricity in the first place. Amid criticism of its stance from generators utilities and Wall Street the DWR says it has started covering more of the utilities' electricity costs. The water agency is now buying 95% to 99% of what California needs in a given day says the agency's Mr. Hart. But increased buying only adds to the uncertainty about the eventual tab. The state's legislative analyst Elizabeth Hill recently recommended that lawmakers hold off considering more than $2 billion in state spending on items ranging from college construction to beach cleanups because of continuing questions about the financial impact of the electricity crisis. Like others Ms. Hill complains that the governor's office and state agencies haven't been forthcoming with information. Indeed the DWR refuses to say precisely how much power it is purchasing and at what prices though it has on several occasions gone back to the Legislature for more money. State officials say that data on its purchasing activities would give suppliers an advantage in continuing electricity-supply contract talks. State Controller Kathleen Connell who is running for mayor of Los Angeles in an April election recently announced plans to post state power-spending information on her department's Web site. But within 24 hours Ms. Connell suspended that plan after discussions with senior Davis administration officials. I feel very strongly that this information should be publicly released says Ms. Connell. I just don't want to do anything that would weaken the state's effectiveness in negotiating. In an effort to more tightly control events the governor obtained legislative approval to abolish the 26-member ISO board which was made up of everyone from utility executives to representatives of consumer groups. He then appointed a new five-member board. To ensure a quick transition the California attorney general threatened the old board members with fines of as much as $5000 each if they didn't immediately relinquish their positions. All did. I was offended at the heavy-handed treatment says Karen Johanson a former ISO board member. One of the first acts of the ISO's new board was to close a meeting about the electricity crisis. The former ISO board routinely held such meetings in public. ISO attorneys say the meeting was largely designed as a private briefing for new board members and that the organization is committed to keeping its deliberations as open as possible. The Wall Street Journal and other news organizations have unsuccessfully challenged the closure in Sacramento state court. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: On Market Power in California Body:: fyi. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Public Policy Contacts for California Body:: Please respond to kevinscott Jeff and Steve As you requested I have prepared a list of my preferred public policy contacts for California. It is composed of professionals from an array of public private and non-profit backgrounds. I have worked in some capacity with each of these people and most I know quite well. Please call me for further background. Kevin 213-926-2626 Attachment - Kevin Scott - Preferred Contacts - 6-20-01.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Can you help me? Body:: ----------------- What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RED Index shows Texas, NY, and Maine advance on retreating Pennsylvania Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: PLEASE MARK YOUR CALENDAR Date: Every Thursday Time: 7:30 am Pacific 9:30 am Central and 10:30 am Eastern time Number: 1-888-271-0949 Host Code: 661877 (for Ray only) Participant Code: 936022 (for everyone else) The table of the on-going FERC issues and proceedings is available to all team members on the O drive. Please feel free to revise/add to/ update this table as appropriate. Proposed agenda for tomorrow: CAISO filed Amendment No. 40 which would suspend the use of preliminary invoices and disbursements. CA refund proceeding status. Please feel free to communicate any additional agenda items to the group . What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Liberalisation of Italys Energy Markets Body:: Any interest? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Invitation to speak at September Pricing conference Body:: Forward to whomever you see fit. It looks like an opportunity to explain price risk management to large customers. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: UC/CSU press release Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Regulatory issues memo: Revised Body:: Additional information on the regulatory context. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Due Diligence Info - GS Body:: There is a lot of confidential information here (in items 1and 2) Detailed monthly P&L covering all trading activity for the last three years Potential Exposure by sector (eg gas and electricity utility) Detailed monthly P&L covering all trading activity for the last three years. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Energy & Powers Financial Mathematics to Energy Derivatives Seminar Body:: Eugenio It's more or less the same. No big changes. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Enron Mentions Body:: It looks like we are playing a smaller role than the WSJ article indicates -- i.e. a role commensurate with our level of interest. I have talked with John several times about the relative importance of OPIC ExIm and other funding organizations in light of the change in emphasis in our business. As a result of those discussions we cut headcount and expenditures from the proposed budget for 01 and John has joined Linda Robertson's organization in the DC office (instead of being a stand alone effort). Having said that my view (based on the work John has been doing) is that we continue to have a considerable amount of work for him to do on the project finance front as a result of existing projects projects we continue to pursue and transfer issues associated with the asset sales. Do you agree? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request for Comments Body:: Have you solicited comments fromo EES? ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: SRP SETTLEMENT PROPOSAL - PRIVILEGED AND CONFIDENTIAL FOR SETTLEM ENT DISCUSSIONS ONLY Body:: Attached are three documents (cover memo draft settlement proposal settlement procedures timeline) comprising SRP's formal proposal to resolve five pending dockets RP99-507 (Indicated Shippers' Complaint) RP00-336 (Order No. 637 Allocation and Pooling Issues only) RP99-139 (ONEOK Complaint) RP01-484 (Indicated Shippers/California Complaint) and RP01-486 (Texas New Mexico and Arizona Shippers' Complaint). We appreciate the suggestions received to date and believe that while an uncontested settlement may be unlikely a sufficient nucleus is forming around the elements of this proposal that will lead to the filing of an Offer of Settlement and ultimate FERC approval as in the public interest. We encourage your active participation in this process. Note that while Advisory Staff present at the July 18 Technical Conference is aware conceptually that SRP will be distributing a settlement proposal this proposal has not been distributed to the Advisory Staff. This proposal has been sent to Rick Miles Director Dispute Resolution Services for informational purposes only at this time. Joel L. Greene Energy Advocates LLP 202-371-9889 202-371-9025 (fax) jlgreene@energyadvocates.com <> <> <> - SRP EPNG Settle.cvr.doc - SRP EPNG Capacity Proposal.06.26.doc - Proceduralschedule.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Burlington: PRIVILEGED AND CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION Body:: Lorraine here are a few notes from my review of the Val Verde contract and my initial impressions. Let's talk more about how to approach the issue after we meet with Ron tomorrow about MAOP. 12/31/92 Interconnect Agreement: Sec. 1.3 specifies pressures and states that unless there is an agreement to provide firm compression service TW will accept up to 200000 on an interruptible basis. Sec. 2 states that the Blanco Hub MAOP shall not be exceeded. Sec. 4.2 limits damages (no consequential damages). The contract also has a fairly standard force majeure clause. 2/18/93 letter amendment: Sec. 3 obligates TW to provide firm compression service in order to accept 200000 into TW's system (provided MOGI has pressure of at least 650 and quantity of at least 140). Acknowledges that this is an agreement to provide firm compression in accordance with Sec. 1.3 of 12/92 agreement. 9/25/95 letter amendment: Increases quantity to be received at the interconnect to 250000 once the San Juan expansion is effective. My initial conclusions: It is pretty clear we have an obligation to accept 250000 on a firm basis provided that Burlington complies with the pressure requirements. Probably the only way we can avoid this obligation is if accepting 250000 would cause us to exceed the hub MAOP. In that case we can argue impossibility of performance. Also we could avoid the obligation because the summer heat above certain temperatures constitutes force majeure. This argument is strengthened by the fact that temperatures seem to have gotten hotter over the years. The fact that we entered into our most recent agreement with Burlington in January of this year weakens the credibility of our arguments (they will say we should have known by now). Burlington might try to argue that we have an absolute obligation to comply with the agreement even if it means expensive system modifications. That argument is not a very strong one because the agreement contains no such affirmative obligation and in fact quite clearly describes the facilities that are the subject of the agreement. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: TV News Clip Body:: Jeff At the end of last week there was a very interesting TV news story on NBC KRON Channel 4 in San Francisco. You lead the story which also includes Governor Davis President Bush. What most catches my attention are the visuals and chant of the protestors during the Enron segment. The props and signs are very TV camera friendly. For instance there is a larger then life mask of you and a mockup of a paycheck to you from the people of California. The chant rhymes with your name. From my perspective this was no simple pie in the face. This protest was very organized and sophisticated. I think it would be prudent to gain more information about who was behind it and who was behind them. I tried sending you the video file in mpeg format but at 8400k it was too large to email. To see the news clip you may double click this link After downloading the video will play on a computer that has Real Player. Kevin What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ken Lay update Body:: Ken left a msg for me on Sunday. He was able to return Bryson's call. Not much new: Ken got Jeff's paper will try to reach Hertzberg on Monday. Bryson gave an update (very consistent with yours on Fri) Wants us to think creatively about how to keep DWR contracts from preventing the comprehensive solution and how to address the concerns of the state treasurer. Ken tried to reach Pete Peterson (Blackstone) but did not make contact. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Humberto (Beto) Kuhn, resume Body:: Maureen - please forward on to Barry when you get his e-mail address. Barry - I don't know Humberto personally but looking over his resume I thought he might be a fit in your organization. ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - February 2001-CR Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Lawmakers Vote to Limit Power Costs - WSJ Body:: They refer to expedited siting. What are the provisions? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Reliability and Security Arguments (RTOs) Body:: This responds to Charles's voice mail and the RTO conference calls that Janel has been on where we have discussed responding to those who say the heightened interest in security is a reason NOT to do large RTOs. Jim Steffes is the EPSA witness on reliability and other issues at a Barton subcommittee hearing next Wed. Oct. 10th. While the written testimony filed for the Sept. 11 hearing that was canceled is still operative Jim's oral remarks can be whatever he wishes. Also even if he does not raise it in his opening statement the issue will no doubt come up by others or in Q&A. Thus -- any talking points need to be ready by Tuesday for this hearing. Does not have to be anything fancy or hand-out quality. Just something for Jim to consider using. Charles I do not recall any specific articles on what NERC said but Sarah Novosel said she would check since she thought there was something like what you raised in your voice mail. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: California Transactions of EPMI--Confidential ATTY Client Work Product Body:: Robert Here is an updated sheet with EPMI physical transactions with deliveries in California. The format has been improved and I added a breakout for transactions with Dynegy. Please destroy earlier versions of this report. Rick Shapiro has asked to be the point of contact in Government Affairs regarding the merger. Please copy him on future communications. Robert or Rick: Please let me know if you need any help such as adding months putting the data in another format or combining this data with Dynegy market share data. Alan Comnes What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - RLB-Florida Body:: nan What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Vision Focus Groups Body:: Rosie and Sherrie: Jeff Ken and Joe wanted to discuss the attached. Joe -- this is the same document I forwarded to you earlier. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential --CFTC Chair Body:: do not circulate fyi What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Invitation to Corporate Responsibility Task Force Meeting Body:: Let me know when and where. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Surprise!! Body:: EB 4712C Ext. 3-1586 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Senate Investigative Committe Begins Hearings Today @ 1:30 Body:: The State Senate begins it's investigative hearings today April 18 @ 1:30 pm in Room 2040. The topic this week and next week will be to go over previous investigations into market power. Today the committee will be hearing testimony from: Frank Wolak Chairman Market Surveillance Committee CAISO. Eric Hildebrandt Manager Market Monitoring CAISO Elaine Howle State Auditor IEP will be prepared to respond to media at the hearings and will be distributing the attached materials: An outline of previous investigations into market manipulation and price gouging -- and ???their findings. ? A detailed analysis of the flaws in the CAISO reports We will keep you posted. Thanks Jean -- Jean Munoz McNally Temple Associates Inc. 916-447-8186 916-447-6326 (fx) - ISO Report An.pdf - Previous Inve.pdf What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CA Legislative Summary Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Privileged and Confidential communication to my attorneys Body:: Felicia Does this sound right to you? Just wanted to confirm. Thanks. Michelle ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PARAGRAPH Body:: Enron also announced today a restructuring of its broadband business. Conditions in the broadband industry have reduced revenue opportunities in the sector. The strategy we pursued in the broadband business will allow us to quickly restructure this business without affecting our strong earnings outlook said Skilling. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Arbitration with Reliance and ONGC Body:: Are you aware of this? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Per Your Request Body:: This is a very good try. I think it comes off too defensive and too genera= l=20 (I just don't think the topic lends itself to the format). Here's what I= =20 think we should do: Jeff is filming a piece for etv about the stock price. = =20 We should perhaps use and expand upon those messages. This approach is= =20 more directed at the bottom line: why our stock price should go up. =09Sarah Palmer@ECT =0903/09/2001 03:14 PM =09=09 =09=09 To: Steven J Kean/NA/Enron@ENRON =09=09 cc: Mary Clark/Corp/Enron@ENRON =09=09 Subject: Re: Per Your Request Thanks Steve. Here's an initial draft -- I've taken a very light eBizy= =20 approach to delivering the message. Perhaps by having some fun with it we= =20 can look a little less defensive. Let me know if we're on track or pitiful= ly=20 way off. Thanks. Comparing Enron to Apples You may have noticed =01) or you may be asking why =01) industry analysts o= ften=20 compare Enron to Wall Street firms like Goldman Sachs or investment banks= =20 like Chase Manhattan. We thought it was time to sort out any confusion=20 between our businesses just in case someone asks you to explain. Here's h= ow=20 we're different from those guys: w Enron provides physical delivery of energy products to customers =01) we = are=20 not just traders. Those guys mainly act as brokers and do not participate= =20 physically. w Enron proactively seeks to reform and create markets. Those guys simply= =20 participate and compete. w Enron extends its business model into new and deregulating markets=20 enabling high growth rates. Those guys are in markets that generate less= =20 aggressive growth rates. w Enron owns physical assets that provide consistent cash flow such as our= =20 pipelines. Those guys do not have them. And if that's not enough we think our employees are so much cooler than=20 theirs. =09Steven J Kean@ENRON =0903/09/2001 01:06 PM =09=09=20 =09=09 To: Mary Clark/Corp/Enron@ENRON Sarah Palmer/HOU/ECT@ECT =09=09 cc:=20 =09=09 Subject: Per Your Request Here are the message points What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Monthly Billing - Detail Class 845 / s100061.xls Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: I'll give 150. Enron Capital & Trade Resources Corp. From: Jeff Skilling 04/19/2001 05:18 PM Sent by: Sherri Sera To: Cliff Baxter/HOU/ECT@ECT Rick Buy/HOU/ECT Ben Glisan/HOU/ECT@ECT Steven J Kean/NA/Enron@Enron Jeffrey Sherrick/Corp/Enron Philippe A Bibi/HOU/ECT Michael Brown/NA/Enron Wade James A Hughes/ENRON_DEVELOPMENT Louise Kitchen/HOU/ECT@ECT Rebecca McDonald/ENRON_DEVELOPMENT Greg Piper/Corp/Enron John Sherriff/LON/ECT@ECT Greg Whalley/HOU/ECT@ECT Janet R Dietrich/HOU/EES@EES Mark S Muller/HOU/EES@EES Matthew Scrimshaw/LON/ECT@ECT David Cox/Enron Communications@Enron Communications Kevin Hannon/Enron Communications@Enron Communications Rod Hayslett/FGT/Enron Stan Horton/Houston/Eott@Eott Danny McCarty/ET&S/Enron@Enron cc: Subject: I know how incredibly busy you all are so I'm sure that making a pledge to Jeff for the MS150 has simply slipped your mind. Well the ride is this weekend time is running out and we need you! Enron's goal is to raise $700000 and Jeff's personal goal is to raise $50000. As of today we are a little better than half way there. Won't you consider helping him reach his goal? Thanks for your consideration. I look forward to hearing from you tomorrow... Sherri :-) What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Spoke with Jeff Body:: I'm glad things are moving forward. I've talked with Dave briefly and will= =20 follow up with him again. Kevin Scott on 07/13/2001 10:14:01 AM Please respond to kevinscott@onlinemailbox.net To: Steve Kean cc: =20 Subject: Spoke with Jeff Steve =20 As planned I spoke with Jeff this morning. It was a great call. I am=20 really excited about what is ahead. =20 We discussed the =01&title=018 issue. I don=01t have any problems. We sh= ould go=20 with what is the best way to enter the organization. =20 =20 Jeff said he was going to touch base with Dave this morning to move the=20 process forward. I can=01t wait for my interviews and to join the team.= =20 =20 Thanks for all of your help. =20 Kevin =20 Contact Information E-mail Phone (213) 926-2626 Fax (707) 516-0019 Traditional Mail PO Box 21074 ? Los Angeles CA 90021 =20 What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Another List Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Corporate Watch article Body:: ----------------- What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ENE Officer Elections Body:: We should include David Oxley -- VP of human resources. From: Kelly Johnson/ENRON@enronXgate on 07/18/2001 11:13 AM To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Subject: ENE Officer Elections Steve: Please review the attached ENE Officer list for your direct reports and approve. Thank you. Kelly M. Johnson Enron Corp. Executive Assistant Tel: (713) 853-6485 Fax: (713) 853-2534 E-Mail: kelly.johnson@enron.com What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: test Body:: test What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Some comments on the brief Body:: I forgot to email myself the brief to track changes but here are my changes in writing: p. 1: Para starting focusing on the latter that sentence change get creative to be innavotaive in its approach. p. 2: 1st full Paragraph Second sentence change uniting to common and there is a typo on line5 reduction n consumption. Should be of page 6: We need the RR for PG&E. Under Part VII Rate Design can we insert a sentence that our proposal unlike the others does not arbitrarily allocate costs to peak period. We told Scott we wuold insert the arbitrariness of other proposals several times in the brief. We also need ro insert discussion about relation of peak to offpeak prices as a 3:2 ratio which is not what other parties have proposed. page 8: 2. Derivation of Threshold Usage: first sentence delete between in first sentence. page 9: Second full paragraph begining Again the UDS's Second sentence sited should be cited p. 12: First full paragraph beginning A primary component Insert a sentence after the second sentence to mention again the arbitrariness of proposals allocatin costs between peak and offpeak. Second full parag beginning Enron's proposal can stick a sentence about arbitrariness in there too. And change more necessary goal in 4th sentence to more critical goal I don't have the email I sent out about what we agreed to insert with Scott so if you have a chance check it to make sure we did everything we agreed to. I am going to try to come into the office very early tomorrow and will check email again but my son has an appointment with the neurologist here in Houston at 9:20 am tomorrow and that is where I will be when you have the 9:30 call (we made this appointment months ago). But I will communicate with Harry and everyone else before then. Thanks. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Management Conference - Hyatt Hill Country Resort, San Antonio Body:: Need to be there by noon to attend Ashok's staff meeting. Fredericksburg A room Your Continental flight leaves at 9:45. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Corporate Policy Committee Body:: The memo going out on Monday discusses the corporate policy committee brief= ly=20 at the end. The corporate policy committee does the MD PRC (evaluation of= =20 MDs and promotions to MD) reviews the recommendations of the other=20 committees (which we are just now forming). Additionally the corporate=20 policy committee met to determine the membership and charters of the other= =20 committees (including the PRC committees). The corporate policy committee = is=20 comprised of the most senior executives including the Office of the=20 Chairman the leaders of the four business units and the heads of the=20 corporate functions. In addition to the specific items mentioned above th= e=20 corporate policy committee was intended to discuss and resolve the major=20 issues facing the company including issues of strategy personnel and=20 challenges facing the company. =20 The corporate policy committee has met three times so far so not much=20 history yet. Perhaps as further pronouncements issue from this august body= =20 we will make more of a point about where they came from. =09Mary Clark =0903/15/2001 05:36 PM =09=09=20 =09=09 To: Steven J Kean/NA/Enron@Enron =09=09 cc:=20 =09=09 Subject: RE: Corporate Policy Committee Steve please briefly describe what the policy committee does so we can=20 respond to this employee question. Thanks. Mary ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Vince I'll have him e-mail you a CV. I'd be happy to speak at the POWER RISK conference. Frank Professor Frank A. Wolak email: wolak@zia.stanford.edu Department of Economics Phone: 650-723-3944 (Office) Stanford University FAX: 650-725-5702 Stanford CA 94305-6072 Phone: 650-856-0109 (Home) World-Wide Web Page: Cell Phone: 650-814-0107 What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Summer Body:: ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Charlie Baker Body:: the price might be a bit stiff particularly in light of the following: I don't think we need the DC grass tops component. we have an effective set of messages contacts consultants and lawyers. Perhaps we could use Charlie as a fresh set of eyes on that stuff but I think that asking him to develop such an effort would be duplicative of what we have done with AAE Paxson Fleischman-Hillard Divall etc. I do think the other aspects of what he proposes would be useful however (and should be less resource intensive and at least a little less costly). Richard Shapiro@EES 08/21/2000 05:12 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Re: Charlie Baker What do you think? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: call phil moeller 202.589.0905 Body:: TASK ASSIGNMENT Task Priority: Task Due On: 4/16/2001 Task Start Date: What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: London, New York, Houston, Financial Mathematics June/July 2001 Body:: Joanna You can keep the name as is. I don't want Zimin to be blamed for the flaws of my presentation. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Suggested Approach Body:: Please see the attached. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Legal Analysis on AB 1890 Body:: What do you think he'll add? Jeff Dasovich Sent by: Jeff Dasovich 10/13/2000 11:01 AM To: skean@enron.com cc: Subject: Legal Analysis on AB 1890 I think it would be a good idea to have Ron Carroll in Watkiss' shop to do a parallel analysis to what we're going to have Mike Day do. Ron's very good and has done much work on these sortrs of issues. You comfortable with that? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ed Segners Staff meeting, in 50M Dining Room Body:: Jordan Mintz 3-7897 Bob Foster 818 302 9210 Kevin Beasley 3-7807 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL - Tennessee political contributions Body:: Barbara short of me coming up with the money it will be next to impossible to get this out of either the trading or origination group. As a significant contributor to the PAC and Enron's other adventures I don't have the room. Personally I also have difficulty making campaign contributions so closely linked to specific legislation or policy. This may not be the answer you want however I am all ears if you have any ideas on raising these funds. Regards Delainey ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: ISO-NE failure to mitigate ICAP market -- Release of ISO NE confidential information Body:: The New England Conference of Public Utilities Commissioners (NECUPUC) filed an Answer if Support of the Motion of the Maine Public Utilities Commission for Disclosure of Information. NECUPUC supports the request for the release of the unredacted copies of ISO-NE's September 21 2000 Answer in this case. In the alternative they would ask that the Commission provide to the regulators that are parties to the proceeding unredacted copies of the ISO's September 21 2000 Answer subject to an appropriate protective order. Duke Energy North America (DENA) filed an Answer that opposes the MPUC request for public information. DENA argues that only a three month lag in the release of confidential information is impermissible under a prior FERC ruling in the NSTAR Services Co. case which set out a six-month lag rule for the release of information. Their second argument was that the request seeks information for all NEPOOL markets and not just the ICAP market which is subject to the suit. If the FERC authorizes the release of confidential information then it should be subject to a protective order which contains the following: The information may only be used for the purposes of this docket. Only specifically named reviewing Reps associated with the MPUC may review the information. The confidential materials may not be removed from the NE-ISO's premises. The reviewing rep must execute a nondisclosure certificate. Answer to the MPUC's Motion for Disclosure of Information from Northeast Utilities Service Company and Select Energy and request for expedited commission action. NUSCO and Select Energy Support MPUC's request for disclosure of information that the ISO has filed under seal but opposes the selective disclosure of this information to the MPUC and other regulatory commissions and not other participants. NUSCO and Select Energy request expedited action due the financial implications and there is also considerable uncertainty regarding prices in the residual ICAP market in January February and March of 2000 due to the suspended settlement pending Commission guidance. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Board of Directors Meeting - February 13, 2001 Body:: Attached are my edits. From: Rebecca Carter on 05/24/2001 04:42 PM Sent by: Kelly Johnson To: Steven J Kean/NA/Enron@Enron cc: Subject: Board of Directors Meeting - February 13 2001 Please provide comments the attached minutes by June 1 2001. If you approve as written please let us know. Regards Rebecca CONFIDENTIALITY NOTICE The information contained in this email may be confidential and/or privileged. This email is intended to be reviewed by the individual or organization named above. If you are not the intended recipient you are hereby notified that any review dissemination or copying of this email or its attachments if any or the information contained herein is prohibited. If you have received this email in error please immediately notify the sender by return email and delete this email from your system. Thank you. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - General Expenses Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ed Segners Staff meeting, in 50M Dining Room Body:: Ralph Reed--get back to him (second week of Oct) What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PG&E Credit Exposure Body:: Ken will be making a call to Bob Glynn at PG&E. Please give the attached to Ken before the call. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Dow Jones Reports that PG&E Buys Forward for 5.6 cents for two years Body:: nan What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Public Report 08-01 Body:: as discussed ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Tariffs Approved Body:: Congrats Ray. ... Now get FERC to do something amazing. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Commission Meetings Body:: I will attend. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Your corner on the intranet Body:: I think you are right. I thought we were going to do both. Elizabeth Tilney@EES 06/13/2001 04:51 PM To: Steven J Kean/NA/Enron@Enron Mary Clark/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON cc: Subject: Your corner on the intranet You know I love this idea BUT I still think we need to let Ken personally address the shots he has taken. It is just not the same to have Jeff say it is okay that the AG of California wants to put Ken in a cell with Spike! I strongly believe we need to give Ken a forum too as he has been at the center of alot of the recent noise. I still believe a video with both of them is the right way to go...The State of Enron. I think Jeff's Corner is a great idea too...can't we do both? Ok I have said this enough..I will go away quietly now and let the experts decide...Beth ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Hearing Body:: Let's take the opportunity. Cynthia Sandherr@ENRON 07/19/2000 06:32 PM To: Steven J Kean/HOU/EES@EES cc: Subject: Re: Hearing Steve: per your voicemail we do not have a date yet but should have it before Congress leaves next Friday. I'll let you know as soon as it is set. As you can see I disagree with Mark per the attached e-mail I sent him earlier today. I do not think it should be Jeff Skilling. Mark does not appear to concur with me. Perhaps I should go ahead and express our interest to testify and then we can have a conversation with the team to decide who should do it. I was just trying to not waste a chit and ask for a spot if we had no interest. We can determine who and what later. So before I ask the Committee we DO want to testify correct? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I understand from Shelley that you are going to be seeing Commissioner Breathitt on Monday. We have been working to persuade her to vote for forceful FERC action on electricity issues. She is widely viewed as the swing vote (with Massey and Hoecker being the other two votes) needed for the Commission to take action. Attached are two documents -- one is a set of talking points for you and the second is a FERC action plan that we are floating with several of the Commissioners. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Phoenix/Equilon Deal; CONFIDENTIAL ATTORNEY/CLIENT COMMUNICATION AND ATTORNEYS WORK PRODUCT Body:: Stan: I understand completely and we will do our very best to achieve your desired approach. The problem is this: Regardless of what the MOU says we will have to go through a size/probability analysis on this deal. The deal is clearly material to EOTT. From an SEC perspective the duty to disclose a pending deal depends upon how material the transaction is and how likely it is to occur. If a deal is very material a lower degree of probability is needed before disclosure is required. The MOU itself is not totally determinative although signing a document which looks like an LOI will increase the chances of having to disclose. In the present case if Equilon's Board gives the go- ahead to deal with us exclusively I feel there would be at least a 20% chance of closing a transaction (based upon past dealings with these folks). Accordingly if/when that happens we will need to take a hard look at the disclosure issue. We do not want to disclose prematurely but I am pretty sure that this deal would be considered material and if we go forward with Equilon I believe that we will need to disclose it at some point prior to closing (certainly after signing a PSA). We can delay disclosure for a period of time for legitimate business reasons and the MOU we sign may not rise to the level of an LOI but at some point---if we go forward with Equilon---we are going to reach a point where the size and probability of the deal will mandate disclosure. We don't need to make a decision at this point we just need to be aware of these circumstances and manage the process accordingly. From a different perspective we want to sign some kind of LOI with Equilon as soon as we feel comfortable doing so because we want the HSR waiting period to begin running. Equilon wants to close by November 1st. Please advise if you wish to discuss further. Thanks. SWD Stanley Horton@ENRON Sent by: Cindy Stark@ENRON 07/12/2000 02:04 PM To: Steve Duffy/Houston/Eott@EOTT cc: Subject: Re: Phoenix/Equilon Deal CONFIDENTIAL ATTORNEY/CLIENT COMMUNICATION AND ATTORNEY'S WORK PRODUCT Steve: Let's start thinking about how we could structure the MOU so we wouldn't have to disclose the deal. I would rather not disclose a tentative deal. Stan From: Steve Duffy@EOTT on 07/11/2000 01:47 PM To: Dana Gibbs Lori Maddox/Houston/Eott@Eott Stanley Horton/Corp/Enron@Enron cc: Joe Richards rbaird@velaw.com Susan Ralph Subject: Phoenix/Equilon Deal CONFIDENTIAL ATTORNEY/CLIENT COMMUNICATION AND ATTORNEY'S WORK PRODUCT Joe R. will be sending out something in greater detail shortly but it appears that Equilon's management would like to pursue a deal with us on an exclusive basis and that this decision is being forwarded to the Equilon Board for approval. If this acquisition goes forward we will need to get organized---in the near term---on a number of logistical/due diligence tasks but one thing we should start thinking about now is the disclosure issue. If the Equilon Board gives the go-ahead for Equilon to pursue this transaction Equilon will probably want to sign a memorandum of understanding with us and this may put us in a disclosure posture because at that point we would be looking at a $65 million deal (approx.) with a closure probability of no less than 20% (in my judgment based upon our past dealings with these people). Even without a signed document the size/probability test would still be an issue for us to deal with. Everyone should be thinking about this issue as we await word from Equilon's Board. Thanks. SWD What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential Communication to my Attorney Body:: so would we have an issue? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Translation of articles Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:JONES TANA Email:tana.jones@enron.com - 7138533399 ? Enron Wholesale Services - Office of the Chairman ? From:??Mark Frevert Chairman & CEO ??????Greg Whalley President & COO ??????Mark Haedicke Managing Director & General Counsel ? Subject:??Confidential Information and Securities Trading ? Enron Wholesale Services ('EWS') maintains official Policies and Procedures Regarding Confidential Information and Securities Trading ('Policies and Procedures') which have been revised as of November 15 2000 to reflect the new EWS structure. These policies and procedures are intended to allow us simultaneously to pursue our diverse businesses and to protect confidential information our reputation for integrity and EWS and its employees from legal liability. ? You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: ? ? You must certify your compliance with the Policies and Procedures within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Lance Schuler at extension 3-5419 Mark Haedicke at extension 3-6544 Alan Aronowitz at extension 3-3214 Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Anti-motivational pictures. Body:: ----------------- What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Funky Business Body:: I have looked it over. I think they would do a good job. Another idea: Dick Foster (advisor to Enron's Board and Senior Director at McKinsey) has a great book out: Creative Destruction. I was on a panel with him recently where he shared some of his research. He is a very good presenter he knows Enron well and his work is first rate. He might be a good addition. I have an idea on the breakout sessions. It needs some work but I'd like to talk it through with you. TERRIE JAMES@ENRON COMMUNICATIONS 07/05/2001 01:09 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Funky Business Steve Have you had a chance to look at the book Funky Business and to give any thought to having Jonas present at the Management Conference? I know you have a thousand other things on your plate not the least of which is California so I understand if the answer is no. However they've been contacted by someone else about the date so we may be forced to decide rather soon. On a related subject I'm contemplating another topic for the conference. I'd seen an article in Fortune several months ago titled Managing for the Slowdown. It talked about new challenges managers face in light of the economic downturn. (Most young managers have never experienced anything but boom times.) The article also outlines a dozen or so things companies should be thinking about now. (Use the downturn as a new opportunity to evaluate people. Overhaul your budget process. Don't stop communicating. etc.) I think it would be beneficial to address similar strategies and ideas with our managers. I'd love to get your thoughts on this idea. (Is it appropriate for Enron or am I just seeing the world through bleak-colored glasses?) Terrie James Sr. Director Corporate Communication Enron Broadband Services 713-853-7727 (phone) 713-646-8887 (fax) terrie_james@enron.net What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - Rob Bradley-Mar 5-6 Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Memo to go out. Body:: looks good Maureen McVicker 05/01/2001 05:36 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Memo to go out. Steve: FYI - this is what went out Tuesday night after a few minor changes. It was approved by Ken Jeff & Cliff. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Monthly Billing - Detail Class 845 / s100061.xls Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: FYI. JDS ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Thu evening Body:: Thanks. Confirmed Thu 8:30. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Thurs 7/5: Many rural towns to escape blackouts utility maps sho= w Sac Bee Tues 7/3: Details emerge in power contracts SD Union Thurs 7/5: New FERC member seems attuned to state's woes SD Union Wed 7/4: Electricity price-cap tests spark allegations SD Union Wed 7/4: Renewable energy fades from picture in rush for solutio= n SD Union Wed 7/4: SDG&E spreads word of looming blackouts SD Union Wed 7/4: Two more energy whistleblowers slated to come forward SD Union Wed 7/4: Disabled PG&E employees ask state for help in getting= =20 disability checks LA Times Thurs 7/5: Powerful Judge Illuminates Energy Practices Law:=20 'Folksy' jurist 72 stuns utility executives and lawyers alike with his=20 courtroom incisiveness. SF Chron Thurs 7/5: Davis lauds California generator=20 Vote of confidence at Calpine's festival=20 SF Chron Wed 7/4: Activists stage anti-corporate march to power plant=20 SF Chron Wed 7/4: Davis asks PUC to let utilities cut voltage=20 1% savings on energy consumption predicted SF Chron Wed 7/4: Federal price limits backfire=20 Some generators withhold power rather than abide by rate caps SF Chron Wed 7/4: Two more energy whistleblowers slated to come forward Mercury News Wed 7/4: Davis seeking cheaper contracts=20 --- Many rural towns to escape blackouts utility maps show=20 By Carrie Peyton Bee Staff Writer (Published July 5 2001)=20 Huge stretches of Northern California including many rural foothill and=20 valley communities won't face rolling blackouts this summer spared by a= =20 combination of geography and circuitry.=20 Placerville and Loomis Esparto and Isleton are among the many towns that= =20 will be largely or entirely bypassed by deliberate blackouts according to= =20 new Pacific Gas and Electric Co. outage maps.=20 Such communities are served by so few circuits that each one has been=20 exempted from outages because a critical facility such as a fire station o= r=20 a water treatment plant lies along the circuit somewhere PG&E spokesman= =20 John Nelson said.=20 Both PG&E and the Sacramento Municipal Utility District have begun shedding= =20 more light on their strategies for rotating outages in the wake of a=20 governor's order requiring utilities to let people know where blackouts wil= l=20 strike next.=20 For PG&E that has meant quickly posting and then updating blackout maps on= =20 its Web site. For SMUD it has meant publicly detailing for the first time= =20 the boundaries of 78 separate rotating outage areas and listing by number= =20 which areas could be tapped next.=20 We were contemplating putting the map on the Web before the governor's=20 order but the timing coincided very well said John DiStasio SMUD's=20 assistant general manager for customer service.=20 SMUD updated its Web site www.smud.org on June 22 so that now people can= =20 click on rotating outages and then next likely locations and map to see= =20 the shape of outages to come.=20 The map replaces less-precise neighborhood names which is all SMUD supplie= d=20 until Gov. Gray Davis ordered utilities to give the public common=20 geographical boundaries grid or block numbers maps or similar identifying= =20 information about where outages will strike.=20 With six days of rolling blackouts already behind California this year and= =20 forecasts that more probably lie ahead Davis has told utilities and the=20 state Independent System Operator to give better notice of when and where= =20 blackouts might occur.=20 Grid operators and utilities have cautioned that Davis' program of two-day= =20 one-day and one-hour warnings could produce many false alarms because power= =20 supplies often come through at the last minute. There is also some wariness= =20 about outage maps which SMUD and PG&E warn could change at any time.=20 But the maps do provide insight into how each utility will roll blackouts= =20 through its territory. PG&E's maps on the Web at www.pge.com under find= =20 your outage block and then rotating outage block map have recently been= =20 updated to be searchable by zip code.=20 They show that the vast majority of El Dorado and Placer counties and much = of=20 Yolo County are in PG&E's block 50 a designation for a circuit that won'= t=20 be in line for rolling outages because someone along it is crucial to healt= h=20 or safety.=20 Police stations fire stations hospitals and airports are all deemed=20 essential customers that should keep functioning even when the state power= =20 grid is so overloaded that blackouts are needed to keep it from collapsing.= =20 In densely populated areas circuits tend to be compact leaving lots of=20 neighborhoods eligible for rolling blackouts Nelson said.=20 But in rural areas particularly remote rural areas a circuit can go on f= or=20 miles and miles Nelson said. You can have multiple communities on one=20 circuit =01( (and) virtually every community has either a police station or= a=20 fire station or a hospital or a drinking water facility.=20 That has been good news for communities like Placerville which scrambled f= or=20 traffic control earlier this year when a rolling outage took out the signal= =20 lights on Highway 50 which bisects the town of 10000.=20 That has been our biggest concern because of the amount of traffic that go= es=20 through there said City Manager John Driscoll. Placerville will be spared= =20 future outages because regulators now are protecting more hospitals from=20 blackouts and much of the rest of the town shares circuits with hospitals.= =20 We didn't ask to be exempted out but I feel very happy that we are. From = a=20 selfish standpoint it feels very nice Driscoll said.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com.=20 =20 Details emerge in power contracts By Carrie Peyton and Chris Bowman Bee Staff Writers=20 (Published July 3 2001) California's power bills for the next decade probably will exceed the=20 forecasts of Gov. Gray Davis the State Controller's Office said Monday as = it=20 released unedited versions of long-term contracts in a new jab at the=20 governor.=20 The electricity contracts which Davis' office sought in court to keep=20 secret offer a glimpse into the rapid high-stakes deals struck early in t= he=20 state's power crisis and illustrate the way deregulation's unraveling could= =20 haunt California for years to come.=20 Some show that builders of new power plants could recoup the entire cost of= =20 those plants in four years or less. Some show lucrative swaps for power=20 including one arranged the same day California was rocked by rolling=20 blackouts.=20 More than two dozen additional administrative contracts detail the price=20 California is paying its consultants to seek a way out of the power mess= =20 from tens of thousands for Davis' aides down to $51 an hour for copying and= =20 phone answering.=20 The governor's office defended its estimates of the state's future power=20 bill.=20 The 41 long-term contracts 27 consulting contracts five short-term deals= =20 and stacks of receipts and invoices released Monday by state Controller=20 Kathleen Connell may just be the start.=20 Her office hopes to provide details about how much California has already= =20 paid individual power generators in the volatile short-term or spot=20 market.=20 The deals include so many intricate pricing formulas that Connell said she= =20 couldn't immediately predict exactly how high California's hourly power cos= ts=20 would go.=20 Walter Barnes chief deputy controller of finance said the contracts=20 probably would be well in excess of the $69 a megawatt-hour that Davis on= ce=20 said would be California's average cost for contract power for the next=20 decade.=20 The contracts' prices range from $55 to $249 a megawatt-hour and most are= =20 more than the $69 Connell said.=20 The state Department of Water Resources the state's power buying arm late= r=20 revised the $69 forecast to $70 a megawatt-hour through the end of 2010 wi= th=20 the higher priced power coming first.=20 If anything those figures could decline because natural gas the fuel for= =20 most new power plants is getting cheaper DWR spokesman Oscar Hidalgo said= =20 adding that his office sticks with its forecasts.=20 We're on pretty solid ground here he said.=20 As the statewide elected official who pays California's bills Connell=20 repeatedly has criticized the governor for his electricity spending saying= =20 that she never believed the contracts should be kept secret.=20 But Davis' office blasted her for giving out details that power generators= =20 and traders could use to learn the state's negotiating positions and buying= =20 practices and said the information could boost wholesale prices within days= .=20 When they open their electric bill next time every Californian can thank= =20 Kathleen Connell for higher electricity costs Davis spokesman Steve=20 Maviglio said.=20 The long-term contracts were first released June 15 by the water resources= =20 department with power plant names performance data delivery points and=20 other details blocked out under heavy black strokes.=20 Analysts said that was the sort of data they could have used to calculate h= ow=20 much more than the production costs the state was going to be paying for th= e=20 electricity purchased on behalf of three cash-strapped investor-owned=20 utilities.=20 As analysts began sizing up some of the specifics Monday early reactions= =20 were wary.=20 This just shows when the state comes in and takes over the utility system= =20 we're just going to be in deep from all sorts of expenses and inefficiencie= s=20 that we were trying to get away from with deregulation said Arthur=20 O'Donnell who edits a trade newsletter California Energy Markets.=20 Bill Marcus a power consultant who had analyzed the edited contracts for a= =20 consumer group quickly read through the unedited versions muttering things= =20 such as offensive and they got absolutely ripped here.=20 In one swap that was negotiated on a day of rolling blackouts in March the= =20 state agreed to send Powerex the trading arm of British Columbia's=20 government utility 2* times more electricity in the spring than Powerex=20 would return in the summer.=20 Although seasonal swaps are common the 2*-to-1 ratio was a sign of panic= =20 and inexperience on the state's part he said.=20 The consultants who advise California on power deals were frenetic at the= =20 time with one staffer at the Navigant consulting firm billing for hours=20 worked that were the equivalent of 9.7 hours a day for 34 consecutive days.= =20 The power purchase terms disclosed Monday confirm many energy analysts'=20 predictions that California consumers would be paying premium prices for=20 years to cover the costs of the new plants coming on line.=20 In several of the contracts the state agreed to pay generators a 25 percen= t=20 to 30 percent annual return on their plant construction costs which could= =20 pay off the entire plant in four years or less.=20 Before deregulation utilities generally received 3 percent to 18 percent= =20 annual return on their capital investments over 30 years said Marcus a=20 veteran energy analyst whose firm JBS Energy Inc. of West Sacramento=20 represents ratepayer groups.=20 We're all going to have to pay more for power plants over the next 10 or= =20 more years because the generators are looking to pay off their plants in ha= lf=20 the time he said.=20 Beyond blackouts and price spikes this will be the long-term legacy of=20 deregulation he said. The private market needs a high rate of return on= =20 their investment.=20 Several contracts were drafted in the late winter and early spring when=20 California endured Stage 2 and Stage 3 energy alerts.=20 The unmasked terms in some of those agreements reflect the state's=20 desperation for megawatts amid fears of routine blackouts when temperatures= =20 and energy use began to rise in the summer.=20 For example the state agreed in a March 29 contract to pay Calpine $232 a= =20 megawatt-hour to supply 300 megawatts nonstop from July 1 through Sept. 30.= =20 But a more recent Calpine contract calls for about $59 a megawatt-hour=20 starting Oct. 1.=20 Time made all the difference said Jim Macias a Calpine senior vice=20 president. He said that last winter Calpine couldn't guarantee that plants= =20 under construction in Sutter County and the East Bay would be on line by=20 summer. So the company bought the power on the spot market for the state= =20 Macias said.=20 Back in the winter $232 was a good price for electricity this summer he= =20 said.=20 Calpine officials said that they made no money on the sale and even knocked= =20 15 percent off their price to maintain good relations with the state power= =20 buyers.=20 The gesture more than paid off with the signing of the 10-year contract sa= id=20 Kathleen Potter Calpine spokeswoman.=20 It was a great transaction for us Potter said. We appreciate the=20 business.=20 Proponents of free-market energy buying have said that in the long-run= =20 competitive forces would result in more-efficient less-costly power=20 generation.=20 But the contracts show that pressed for more electricity this summer and=20 fall officials resorted to buying power from some of the least-efficient= =20 plants in the state guaranteeing owners of these aging generators 10 more= =20 years of income.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com. New FERC member seems attuned to state's woes=20 Texan may become agency's next chief By Toby Eckert=20 COPLEY NEWS SERVICE=20 July 5 2001=20 WASHINGTON -- During his first weeks at the Federal Energy Regulatory=20 Commission Pat Wood has set a decidedly different tone in the agency's=20 strained relationship with California.=20 After meeting with Gov. Gray Davis last week Wood -- who was recently=20 appointed to the commission by President Bush and is widely expected to be= =20 named chairman soon -- praised the state's efforts to come to grips with it= s=20 power problems. It was a stark contrast to the almost constant criticism fr= om=20 FERC Chairman Curtis Hebert.=20 It certainly seems to me that both the political leadership and the=20 regulatory leadership of the state are committed to the kind of=20 infrastructure upgrades that are needed to really get supply and demand bac= k=20 into whack Wood said referring to power plants being built in California= .=20 The former Texas utility regulator also raised the possibility of closer=20 cooperation between FERC and state regulators including a joint effort o= n=20 inspecting power plants. State officials have accused generators of idling= =20 plants to drive up electricity costs a charge generators deny.=20 If we're kind of co-regulators with the state and in many regards we are= =20 it's helpful to work off the same set of facts so you get to conclusions mu= ch=20 more expeditiously Wood said though he was quick to add that he has not= =20 seen any evidence of intentional withholding of supply.=20 State officials hope Wood's statements signal that FERC is poised to take a= =20 more aggressive role in helping the state. If elevated to chairman Wood=20 would set FERC's agenda and shape its approach to dealing with California.= =20 The agency regulates wholesale electricity and natural gas markets which= =20 have subjected the state to skyrocketing prices.=20 Wood has brought a very good perspective to FERC said Howard Gantman a= =20 spokesman for Sen. Dianne Feinstein D-Calif. a frequent critic of the=20 commission. He seems very interested in getting to the root of the problem= =20 and finding solutions.=20 Throughout the crisis the state's relationship with FERC has been poisonou= s.=20 Davis criticized the commission for being slow to rein in electricity price= s=20 while Hebert faulted the state for crafting a bad deregulation law and=20 failing to build enough plants to keep up with demand.=20 Davis issued a guardedly conciliatory statement after his meeting in=20 Sacramento with Wood and Commissioner Nora Brownell who is also new to FER= C.=20 In a refreshing change from my past dealings over the past year with the= =20 agency these commissioners offered a problem-solving approach in resolving= =20 California's energy challenge Davis said. He added It appears that FERC= =20 may finally be poised to do its job controlling energy costs.=20 Threats criticized Despite the soothing words there is no shortage of potential flash points= =20 between Davis and FERC.=20 Wood who professes a religious zeal about competition raised concerns= =20 about a possible move by the California Public Utilities Commission to keep= =20 retail power customers from shopping around for alternative providers.=20 He also criticized threats that Davis and other California politicians have= =20 made to seize power plants and impose a windfall profits tax on power=20 sellers.=20 I think the rhetoric's still pretty hot out there. If I were a generator= =20 looking at 50 states one that's talking about a windfall profits tax and= =20 expropriation of property and all that is not a great climate Wood said.= =20 For his part Davis has questioned whether the recent price curbs imposed b= y=20 FERC in the West will be enough to tame soaring wholesale power costs that= =20 have bankrupted one utility cost the state treasury billions of dollars an= d=20 raised consumers' power bills.=20 Davis has also made it clear that he expects hefty refunds to result from t= he=20 FERC-brokered talks between the state and power providers which are in the= ir=20 second week.=20 I will be vigilant in insisting that Californians get their money back= =20 Davis said.=20 California consumer activists are taking a wait-and-see attitude toward Woo= d=20 saying they know little about him.=20 A major role My impression from afar is he seems to be more moderate said Harvey=20 Rosenfield president of the Foundation for Taxpayer and Consumer Rights in= =20 Santa Monica.=20 Once considered a bureaucratic backwater the five-member FERC has come to= =20 play a high-profile role in the California debacle and other disputes=20 involving the largely deregulated wholesale power markets.=20 The commission is charged with ensuring that just and reasonable prices= =20 prevail.=20 Bush is expected to make Wood the FERC chairman because Hebert is seen as t= oo=20 much of a lightning rod.=20 Before coming to Washington Wood who turned 39 yesterday headed the Texa= s=20 Public Utility Commission. There he oversaw the state's move toward a=20 deregulated electricity market. Like Hebert Wood is convinced that a free= =20 market will deliver cheaper power to consumers than a highly regulated one.= =20 I just think customers fare better when they have more choices Wood said= .=20 But consumer advocates and others who have worked with Wood in Texas say hi= s=20 zeal is tempered by a healthy dose of pragmatism.=20 Bottom line it's all about the customer. Y'all will hear me say that unti= l=20 you get sick of it Wood said. We want to make sure that the world we're= =20 moving to is better than the one we left.=20 Electricity price-cap tests spark allegations=20 Suppliers said to have held back industry blames ISO By Craig D. Rose and Bill Ainsworth=20 UNION-TRIBUNE STAFF WRITERS=20 July 4 2001=20 The first emergency tests of new electricity price controls have generated= =20 accusations that suppliers were withholding power and questions that the ca= ps=20 might need to be revised or scrapped.=20 And in a case of turnabout a power industry spokesman yesterday said the= =20 Independent System Operator which manages the state's electricity grid=20 might be using the federal price caps to manipulate the electricity market.= =20 This time however the charge is that the ISO is gaming to push prices=20 lower.=20 At any rate California survived its second consecutive day of power=20 emergencies without blackouts under price caps recently imposed by federal= =20 regulators but not without some bumps along the way.=20 The main culprit was hot weather that baked Western states for two days=20 forcing the ISO to issue Stage 1 and then Stage 2 alerts. Yesterday the IS= O=20 warned that rolling blackouts might hit in the afternoon.=20 But as has happened often this year the ISO bought power in the last minut= es=20 to avoid outages. The grid operator also credited conservation efforts with= =20 shaving from 2000 to 4000 megawatts of consumption. A megawatt can power= =20 about 750 homes.=20 It was a lot hotter than expected and a lot more humid said Kristina=20 Werst spokeswoman for the ISO.=20 Today state officials expect to avoid any blackouts because of the holiday= =20 which tends to decrease electricity demand Werst said.=20 The price controls ordered last month by the Federal Energy Regulatory=20 Commission set up formulas for maximum prices during emergency and=20 nonemergency periods. The FERC said the complex system was intended to=20 balance the need for lower costs with its desire to promote a power market.= =20 But questions are growing about the effectiveness of the FERC price caps.= =20 A Department of Water Resources spokesman which buys power for the state= =20 said generators withheld between 660 and 1500 megawatts of electricity=20 during a critical period earlier this week because of the price caps. That= =20 would be enough to cut electricity reserves from 7 percent to 5 percent and= =20 bump a Stage 1 alert to a Stage 2.=20 Sempra Energy Trading a marketing unit of San Diego Gas & Electric Co.'s= =20 parent corporation admitted that it ceased selling power to the state for= =20 what could have been a critical 30 minutes Monday.=20 A spokesman for the trading company said it halted sales for the half-hour= =20 because it was unsure about where the ISO would set maximum prices during t= he=20 first power emergency under the new caps.=20 When power emergencies are called under the FERC plan a new price cap is s= et=20 based on the cost of operating the least efficient most costly electric=20 generating plant. Because the identity of that plant is unknown beforehand= =20 the selling price is set retrospectively by the ISO.=20 It was unclear to the traders what the proxy price would be said Doug=20 Kline a Sempra spokesman who emphasized that the company's trading unit= =20 resells power generated by other companies. So it was unclear whether the= =20 ISO would come back later and say 'You purchased power at $70 per=20 megawatt-hour but we're only going to pay you $60.'?=20 For its part the ISO said the impact of price controls on electricity=20 supplies during emergencies is still unclear. The controls this week kept= =20 emergency prices Monday from a little over $70 per megawatt-hour to a high = of=20 about $90. FERC's nonemergency price cap has been about $92 per=20 megawatt-hour.=20 Earlier this year the average price per megawatt-hour was nearly $300.=20 Before the power crisis hit last year the price was about $30.=20 The ISO said several factors other than the price controls might have=20 contributed to tight supplies this week including plant shutdowns in other= =20 states and the regional heat wave.=20 But a spokeswoman for Nevada Power said the utility believed the price caps= =20 or confusion over their implementation had contributed to a power shortfal= l=20 that led to blackouts Monday. The utility fell about 100 megawatts short of= =20 its need as temperatures in some of its service areas hit 122 degrees.=20 Power is tight in the region said Sonya Heagen of Nevada Power. What=20 tipped it over (for southern Nevada) was several utilities decided to hold= =20 back power.=20 Gary Ackerman executive director of the Western Power Trading Forum an=20 industry group said the FERC's price-control plan fails to allow the=20 recovery of electricity transportation costs. That has the effect of keepin= g=20 electricity in the region in which it is generated rather than where it=20 might be needed most he said.=20 Ackerman said transportation costs which typically run from $2 to $8 per= =20 megawatt-hour are more significant now that overall prices have settled in= to=20 a $100 range.=20 They didn't mean as much to the suppliers when they were getting $400 per= =20 megawatt-hour Ackerman said.=20 He also said some of his members suspect the ISO made moves during power=20 alerts to artificially keep prices lower.=20 The FERC pricing regime sets nonemergency prices at 85 percent of the last= =20 full hour of a Stage 1 emergency. But this week the ISO twice went from a= =20 Stage 1 to a Stage 2 alert in less than an hour. That kept the nonemergency= =20 price cap in place at about $92 per megawatt-hour set back in May.=20 Some traders said the ISO is 'gaming the market' to keep the price lower= =20 Ackerman said. I have a few traders who think the price should be higher.= =20 The ISO rejected the charge of manipulation and said it continues to make i= ts=20 emergency declarations based on power supply and demand. The ISO also said = it=20 has not identified transportation costs as a problem under the FERC order.= =20 Other energy experts however said the FERC system of using the most=20 inefficient power plants to set emergency prices was a mistake.=20 Frank Wolak a member of the ISO's market monitoring unit and a Stanford=20 University economist said the plan invited energy companies to keep their= =20 least efficient plants in operation to ensure the highest prices.=20 But James Sweeney also a Stanford professor and energy expert said he=20 preferred the FERC plan to a rigid market price cap.=20 Consumer advocate Doug Heller of the Foundation for Taxpayer & Consumer=20 Rights said the FERC plan is too complex and urged a return to a regulated= =20 system which pays generators for their production costs plus a reasonable= =20 profit. Gov. Gray Davis supports a similar approach.=20 Arthur O'Donnell editor of California Energy Markets saw much of the=20 maneuvering this week as an industry road test of new price regime.=20 I think they were testing the boundaries O'Donnell said. This is the we= ek=20 where we test the bugs in the system.=20 Copley News Service correspondent Toby Eckert and The Associated Press=20 contributed to this report.=20 Renewable energy fades from picture in rush for solution=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 July 4 2001=20 SACRAMENTO -- The electricity crisis is putting the squeeze on the renewabl= e=20 energy industry: the power plants that use the sun wind or underground hea= t.=20 The environmentally friendly alternative energy provides about 12 percent = of=20 the state's power. But the energy crunch and the state's effort to resolve = it=20 could end up shrinking the role of renewable energy in the coming years jus= t=20 as backers were hoping to see it expand.=20 For example:=20 ?Long-term power contracts obtained by the state to reduce costs will cover= =20 most state needs for a decade. Nearly all of the contracts are with natural= =20 gas-fired plants reducing the long-term market for new renewable plants.= =20 ?The uncertainty and lack of payment resulting from the crisis have slowed= =20 the development of renewable plants under an incentive program created as= =20 part of the state electricity deregulation plan.=20 ?Regulators are poised to prevent marketers from selling electricity=20 including green power from renewable sources directly to customers. A=20 large base of ratepayers must stay in the state program to pay off a power= =20 bond of up to $13.4 billion over 15 years. The state Public Utilities=20 Commission yesterday for the second time put off a decision whether to=20 curtail such direct access.=20 State and federal programs had been encouraging renewable energy to reduce= =20 dependency on the new wave of relatively clean and efficient natural-gas=20 power plants. The cost of electricity from those plants could go up if the= =20 demand for gas outpaces supply.=20 Renewable energy with the exception of some biomass plants also avoids th= e=20 pollution problems of power plants fueled by oil and coal -- not to mention= =20 the safety and radioactive waste-disposal problems of nuclear power.=20 A spokesman for a coalition of renewable generators and environmental group= s=20 said he thinks renewable energy has suffered during the electricity crisis= =20 because of a lack of attention not a shift in state policy.=20 I think the renewables are an unintended casualty said V. John White of= =20 the Center for Energy Efficiency and Renewable Technologies.=20 The state became a major player in the power equation in January when it=20 began buying power for debt-ridden utilities.=20 State officials say they would like to have a mix of power to spread the ri= sk=20 if something goes wrong with one source. For example soaring natural gas= =20 prices last winter were part of the reason for the high cost of electricity= .=20 In a trade-off the state scrambled to obtain long-term contracts that woul= d=20 lower the price of electricity now in exchange for prices that are expected= =20 to be above the market in the years to come.=20 The 38 contracts worth $43 billion over the next decade will help finance= =20 the construction of gas-fired power plants. About 70 percent of the power= =20 will come from plants that have not yet been built.=20 Only four of the contracts are for renewable power and their 120 megawatts= =20 is a tiny fraction of the total amount of power now under state contract. A= =20 megawatt can provide power for 750 to 1000 homes.=20 We agree the portfolio is lopsided and should be more diverse than it is= =20 Ray Hart head of the power purchasing unit in the state Department of Wate= r=20 Resources told the Senate Energy Committee last month.=20 The state has agreements in principle on an additional 19 contracts for 12= 70=20 megawatts from renewable sources. Most of the power 1172 megawatts would= =20 come from wind generation.=20 Anything could happen said Oscar Hidalgo a Water Resources spokesman. = It=20 could increase or decrease depending on what gets signed.=20 One renewable generator CalEnergy said the state rejected its offer to=20 provide 340 megawatts from a geothermal plant in the Imperial Valley for 20= =20 years at 6.9 cents per kilowatt-hour a price that is said to be the 10-yea= r=20 average of the state contracts.=20 We were astonished said Jonathan Weisgall CalEnergy vice president.=20 Hidalgo said state power purchasers don't recall the specifics of the=20 CalEnergy offer. He said the proposal may have been rejected because of its= =20 length the time of the power delivery or other reasons.=20 They may have to regroup restructure repackage and look for what we=20 want Hidalgo said.=20 Under deregulation part of monthly ratepayer bills were earmarked for a fu= nd=20 to encourage renewable energy sources. The fund provides five-year incentiv= es=20 of up to 1.5 cents per kilowatt hour.=20 The state held auctions in 1998 and again last summer that awarded $202=20 million in incentives for dozens of new small renewable plants that could= =20 produce about 1000 megawatts. The average incentive was .4 cents per=20 kilowatt hour.=20 But at this point said Marwan Masri of the California Energy Commission= =20 only plants capable of producing 180 megawatts have been completed.=20 There is the overall issue of who will buy the power said Masri and at= =20 what price and for how long.=20 A firm that specialized in marketing green power from renewable sources f= or=20 the environmentally conscious has taken a double hit from the electricity= =20 crisis.=20 Green Mountain Energy of Austin Texas. sells power to customers in a part= =20 of deregulation that is often called direct access which bypassed=20 utilities and later the state after it began buying power for utility=20 customers.=20 The firm canceled contracts with 50000 customers because the price was=20 indexed to the state Power Exchange which went bankrupt last spring after= =20 the debt-ridden utilities defaulted on their debt.=20 Green Mountain still has contracts with about 7000 customers in San Diego= =20 County who receive power under contracts at a fixed rate 8.5 cents per=20 kilowatt-hour.=20 The state Public Utilities Commission is still expected to prohibit future= =20 direct-access contracts a step directed by the legislation authorizing the= =20 state to buy power for utility customers.=20 That was the second blow to us said Rick Counihan of Green Mountain. It= =20 meant that we couldn't go out and buy a block of fixed-price power to sell = to=20 customers.=20 The ban on direct-access contracts is vigorously opposed by business groups= =20 who say that direct access would lower the cost of doing business in=20 California.=20 But supporters of the direct-access ban say that if customers bypass the=20 utilities the remaining ratepayers will be stuck with paying off a bond of= =20 up to $13.4 billion that is expected to be issued in September for power=20 costs.=20 Despite the problems some representatives of the renewable energy industry= =20 are optimistic about its potential for growth in the future.=20 A lot of the market is being served by rapidly aging power plants that=20 should be replaced said Jan Smutny-Jones of the Independent Energy=20 Producers. I think we also are going to see additional demand.=20 Moreover state government may take more steps to encourage the renewable= =20 industry.=20 The Energy Commission is proposing a goal for the incentive program that=20 would increase the amount of power coming from renewable sources to 17=20 percent of the total by 2006 up from 12 percent.=20 State Sen. Byron Sher D-Stanford has introduced a bill SB 531 that woul= d=20 set a goal of increasing the renewable share of state power to 20 percent b= y=20 2010. SDG&E spreads word of looming blackouts=20 By Jeff McDonald=20 UNION-TRIBUNE STAFF WRITER=20 July 4 2001=20 While power supplies dwindled and the likelihood of blackouts loomed San= =20 Diego Gas & Electric Co. for the first time yesterday was able to warn=20 customers in advance that they might go dark.=20 Under increasing pressure from businesses and residents SDG&E launched a n= ew=20 system to notify customers by pager and e-mail whenever the state declares= =20 supply emergencies that might lead to blackouts.=20 Some 5000 customers signed up for the warnings which ended up being false= =20 alarms by midafternoon when the Independent System Operator which manages= =20 the state's electricity grid was able to find enough megawatts to avoid th= e=20 first blackouts since May.=20 This at least gives people the opportunity to make a switch over to backup= =20 generation to power down essential equipment or to back up critical files= =20 SDG&E spokesman Ed Van Herik said.=20 It's definitely an improvement but we'll certainly look for ways to=20 increase the effectiveness of the notification process.=20 Even so the warnings from SDG&E came barely an hour before the ISO was=20 expected to issue a Stage 3 power alert meaning that demand had climbed to= =20 within 1.5 percent of available supplies. As it turned out the state never= =20 rose above a Stage 2 alert.=20 As the threat of blackouts continues to vex state power officials early=20 warnings about potential outages have become a key issue for businesses and= =20 residents who rely on uninterrupted service.=20 During blackouts earlier this year darkened traffic lights caused numerous= =20 accidents people were stranded in elevators and business owners complained= =20 of losses that could have been minimized.=20 Regular notification is a good idea said Samuel Ingersoll-Weng of the Sa= n=20 Diego Community Technology Group which works with hundreds of local=20 organizations to promote computer literacy.=20 It would be very helpful in terms of scheduling staff canceling or holdin= g=20 classes and also to protect equipment from power spikes or suddenly being= =20 shut off he said.=20 For most of the year SDG&E was telephoning a small number of such customer= s=20 on mornings they worried that demand for electricity might exceed supplies.= =20 But the problem is that when orders to pull megawatts from the grid come fr= om=20 the ISO the utility has only minutes to cut supplies and there has been=20 little time to warn people they may lose power.=20 Yesterday SDG&E was told 90 minutes ahead of time that a Stage 3 warning= =20 would likely be called at 3 p.m. The company issued the mass e-mails and=20 pages within 30 minutes.=20 Gov. Gray Davis announced plans this spring to provide neighborhoods 48-= =20 24-and 1-hour notices when blackout orders might be called. The ISO issued = no=20 such notice yesterday when it came the closest it had in weeks to ordering= =20 blackouts.=20 Ratepayers interested in signing up to be notified early of potential=20 blackouts can call the utility at (800) 411-SDGE.=20 Two more energy whistleblowers slated to come forward=20 By Don Thompson ASSOCIATED PRESS=20 July 4 2001=20 SACRAMENTO =01) Two more former workers at a San Diego-area Duke Energy pla= nt=20 are slated to talk with state investigators Thursday echoing concerns by= =20 other employees over how the plant was run when the state needed its power= =20 most.=20 However another former worker at the Chula Vista plant said he discarded= =20 perfectly good equipment three to five years ago while the plant was still= =20 owned by San Diego Gas and Electric.=20 Stuff that cost $3- to $5000 we were throwing away said Don Perkins of= =20 Alpine a mechanic at SDG&E plants for nearly 25 years.=20 That undercuts testimony from other former workers who told the Senate Sele= ct=20 Committee to Investigate Price Manipulation of the Wholesale Energy Market= =20 last month that they discarded valuable repair parts on the orders of Duke= =20 supervisors.=20 Like the other former SDG&E employees who have come forward Perkins was no= t=20 hired by Duke when it took over full operation of the plant in April. Perki= ns=20 said he is happy in retirement but like his former co-workers believes Duk= e=20 was driving up energy prices =01) which the company vehemently denies.=20 He and the three other former workers suggested Duke did not adequately=20 maintain its equipment leading to unnecessary repairs they said cut power= =20 generation and may have helped boost prices by cutting supply. That include= d=20 running a 15-megawatt jet-fuel fired turbine until it broke down.=20 We ran the heck out of the plant you bet we didresponded Duke spokesman= =20 Tom Williams. But he said the plant had fewer outages under Duke's ownershi= p=20 than while it was owned by SDG&E.=20 Duke eventually had to completely rebuild the jet-fuel fired turbine=20 Williams said.=20 It ran more last year than the previous 37 years combined because the sta= te=20 needed the power Williams said.=20 An attorney for Lt. Gov. Cruz Bustamante who is to introduce the two new= =20 whistleblowers Thursday said they will echo their co-workers complaints th= at=20 maintenance slipped once Duke took over the plant.=20 Williams dismissed the news conference as a media event and the workers'= =20 complaints as old news the company has rebutted since the earlier testimony= =20 before the committee.=20 Disabled PG&E employees ask state for help in getting disability checks=20 ASSOCIATED PRESS=20 July 4 2001=20 SAN FRANCISCO =01) After not receiving checks for work-related disabilities= for=20 months more than 200 Pacific Gas and Electric Co. employees have asked the= =20 state to take over their disability payments.=20 The employees stopped getting checks after Pacific Service Employees=20 Association sent them a letter saying it did not have enough funds. Until= =20 this year the association had paid almost all of PG&E's disability claims.= =20 PG&E said it has no legal responsibility to help the disabled workers and= =20 blames the employee association. But workers waiting for their payments=20 disagree.=20 The association and PG&E are one and the same A.J. Cavallaro an=20 electrical engineer with PG&E for 25 years who is on disability leave due t= o=20 a sleep disorder told the San Francisco Chronicle.=20 Originally created by PG&E workers to organize social events the associati= on=20 has its own board of directors and is legally separate from the utility and= =20 its parent company. The association began offering a short-term disability= =20 plan to PG&E workers in 1949.=20 Pacific Service transferred its members to the State Disability Insurance= =20 plan on Jan. 1. But about 230 PG&E workers decided to stay with the=20 association's plan after they were told they would continue to receive thei= r=20 disability checks.=20 Mike Colon the association's general manager filed an appeal with the=20 California Unemployment Insurance Appeals Board for the state to take over= =20 the group's payments.=20 Ralph Hilton chief counsel for the appeals board in Sacramento said that = if=20 the board decides the state should take over the payments checks would be= =20 issued within days of the ruling.=20 Workers may have to wait until August for the case to be heard.=20 National Desk=20 THE NATION Powerful Judge Illuminates Energy Practices Law: 'Folksy' jurist= =20 72 stuns utility executives and lawyers alike with his courtroom=20 incisiveness. RICARDO ALONSO-ZALDIVAR ?=20 07/05/2001=20 Los Angeles Times=20 Home Edition=20 Page A-12=20 Copyright 2001 / The Times Mirror Company=20 WASHINGTON -- The silver-haired judge handling federal negotiations on=20 refunds for alleged overcharges by power generators in California is often= =20 described as a Southern gentleman.=20 But Curtis L. Wagner Jr. can lose the folksy charm in a New York minute.=20 Wagner chief judge of the Federal Energy Regulatory Commission showed his= =20 knack for cutting through nonsense when he tangled with a smooth energy=20 company executive in his hearing room in May. The executive confidently=20 insisted he didn't need his boss' approval to enter into a $39-million=20 natural gas transportation deal.=20 Wagner didn't buy it.=20 I'm appalled that you're trying to pull this over my eyes intoned the=20 judge stunning a courtroom of high-priced lawyers into catatonic silence.= =20 Just answer my question . . .=20 Did you get approval . . . whether you got it after the meeting whether y= ou=20 got it the day before whether you got it in the head while you were both= =20 relieving yourselves?=20 Added Wagner owner of a 32-foot sailboat named Hizzoner: The head for= =20 non-boating people is the restroom.=20 Visibly squirming the witness acknowledged that his boss had in fact OKd= =20 the deal.=20 That kind of mettle prompted FERC's governing board to assign the overcharg= e=20 settlement case to the 72-year-old judge who likes to stay in shape by=20 attending early-morning aerobics classes in the agency's exercise room. I= =20 think Judge Wagner is the toughest tool in our toolbox said FERC=20 Commissioner Patrick H. Wood III.=20 Expectations are low that anybody can bridge the chasm between California a= nd=20 electricity generators and marketers with the state alleging it was gouged= =20 by $9 billion and the companies muttering about governmental extortion.=20 There are some very large numbers being talked about which makes it=20 unlikely that the companies would want to agree to a settlement said Kit= =20 Konolidge an electricity industry analyst with Morgan Stanley in New York.= =20 But in an interview Wagner said he feels pretty good about the chances. = I=20 never give up until the very end. With these things it looks impossible a= nd=20 then all of a sudden it comes together.=20 FERC the equivalent of a national utility commission is also dangling som= e=20 carrots in front of the parties. Along with refunds Wagner is trying to ge= t=20 a deal on long-term contracts for power and guarantees that the generators= =20 which are owed hundreds of millions of dollars will be paid.=20 The commission set a short time frame for the negotiations which are to=20 conclude Monday. If a settlement is not reachable FERC would impose its ow= n=20 solution. A mandated settlement is likely to be challenged in federal court= =20 where it could bog down for years.=20 FERC employs more than a dozen administrative law judges like Wagner to hea= r=20 disputes involving the companies it regulates. While presiding over the=20 closed-door settlement talks Wagner has traded his robes for a business=20 suit.=20 He has come down from the bench and sits at a table eye-level with more th= an=20 140 lawyers in his hearing room. There's a lot of billable hours there h= e=20 said.=20 The lawyers have been sorted into three big working groups representing=20 state agencies power sellers and energy marketers. The negotiations are=20 expected to intensify this week and participants said Wagner admonished al= l=20 sides on Friday to be ready to deal or face summary judgment from the FERC= =20 commission.=20 The judge has been variously quoted as saying that $1 billion $2 billion o= r=20 $2.5 billion might be an appropriate total refund. None of those [figures]= =20 are really attributable to me. I did make a statement--and I probably=20 shouldn't have--that it was probably less than $9 billion. Of the $9 billi= on=20 in overcharges claimed by the state only $5.4 billion is attributable to= =20 sellers within FERC's jurisdiction.=20 James J. Hoecker immediate past FERC chairman in the Clinton administratio= n=20 said that in 23 years as chief judge Wagner has built a reputation for=20 making things happen in difficult situations.=20 What is behind that is a lot of years on the bench and a certain amount of= =20 self-confidence Hoecker said. He has the ability . . . to move the parti= es=20 closer together. Sometimes that requires some fairly dramatic statements= =20 which are calculated to get people to feel the heat and get more creative= =20 about the flexibility they might have.=20 A senior FERC official said Wagner is like a pitcher who gets called from t= he=20 bullpen when the game is on the line. When things are tough we turn stuff= =20 over to Curtis said the official who asked not to be identified.=20 Wagner has had many big cases over the years on matters too arcane to garn= er=20 national attention.=20 He is handling a second major case before FERC. It involves allegations tha= t=20 Houston-based El Paso Corp. manipulated California 's natural gas market la= st=20 year thereby adding an estimated $3.7 billion to the state's energy costs.= =20 It was in that case that he grilled the executive.=20 Success in the California settlement negotiations would cap Wagner's 47th= =20 year as a government lawyer. The Tennessee native started at the Justice=20 Department on Aug. 2 1954. He got into regulatory law by representing the= =20 military in railroad disputes arising from the Korean War. After serving as= a=20 civilian lawyer for the Army for more than a decade he joined FERC's=20 predecessor agency in 1974.=20 But Wagner a widower doesn't dwell on his place in the annals of FERC. He= =20 tells agency employees he is working too many hours and missing his aerobic= s=20 classes.=20 Davis lauds California generator=20 Vote of confidence at Calpine's festival=20 Suzanne Herel Chronicle Staff Writer Thursday July 5 2001=20 2001 San Francisco Chronicle=20 URL:=20 /05/M N166801.DTL=20 Gov. Gray Davis took the stage at the San Jose America Festival yesterday a= nd=20 pledged to keep the lights on -- with the help of the Calpine energy=20 company which sponsored the fete.=20 You've heard me say some pretty tough things about out-of-state energy=20 companies trying to bleed us dry said Davis standing against the backdro= p=20 of a huge Calpine banner proclaiming Reliable Energy for a Brighter=20 Future.=20 Calpine is from California he said. They're going to make sure the ligh= ts=20 stay on.=20 Davis was a surprise guest sandwiched between musical acts Nina Storey and= =20 John Brown's Body during the daylong Fourth of July festival which feature= d=20 music food and vendors near the San Jose Airport.=20 The governor thanked the crowd of at least 1000 for joining other=20 Californians in conserving energy. Conservation surpassed the 10 percent ma= rk=20 statewide in May and June he said.=20 We could not get through the summer without you doing your part he said.= =20 Davis was introduced by Calpine chief executive Peter Cartwright -- whose= =20 multimillion-dollar stock option cash-in made news last month -- and San Jo= se=20 Mayor Ron Gonzalez who unsuccessfully opposed Calpine's planned 600-megawa= tt=20 Metcalf Energy Center in Coyote Valley.=20 In an interview after his appearance Davis countered criticism leveled at= =20 him this week by State Controller Kathleen Connell who accused him of=20 foolishly locking California into expensive long-term energy contracts.=20 You have to look at the total cost of electricity he said.=20 The state paid $109 million in May he said but that cost dropped to about= =20 $33 million last month.=20 Earlier yesterday after walking in the Redwood City Fourth of July parade= =20 Davis said that the price drop was a direct result of the long-term=20 contracts.=20 That would not have happened without the security and stability of long-= =20 term contracts he said. We did the right thing.=20 In San Jose he also said that the $15 million the state was paying=20 consultants to help negotiate power contracts was money well spent.=20 Before it was like the Yankees winning the World Series against the sandl= ot=20 baseball team he said. We're finally getting some stars on our team. = =20 E-mail Suzanne Herel at sherel@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 2=20 Activists stage anti-corporate march to power plant=20 GISELE DURHAM Associated Press Writer Wednesday July 4 2001=20 2001 Associated Press=20 URL:=20 tate2 024EDT0201.DTL=20 (07-04) 17:24 PDT LONG BEACH Calif. (AP) --=20 Consumer activists rallied against rising energy prices and pledged their= =20 independence from corporate tyrants amid Fourth of July celebrations=20 Wednesday.=20 About 200 people carrying signs reading public power not corporate=20 bailout and human need not corporate greed marched two miles from a loc= al=20 park in the Los Angeles suburb to the Alamitos generating station.=20 We feel we have been gouged and bled dry said Medea Benjamin founding= =20 director of Global Exchange a San Francisco-based consumer advocacy group.= =20 We've been treated the way tyrants treat their servants.=20 The protest was a joint effort of several national and local consumer=20 activist organizations. No arrests were made although dozens of police=20 officers were out in force for crowd control.=20 Earlier this week a federal judge issued a temporary restraining order=20 preventing the city from enforcing an ordinance that could have blocked the= =20 march.=20 The law requires organizers of public protests to give 30 days notice of th= e=20 event post an insurance bond and pay for police protection at the rate of= =20 $55 per hour for each officer.=20 At the plant organizers had intended to serve officials with a notice of= =20 seizure by eminent domain declaring the facility to be public property. Bu= t=20 nobody appeared at the front gate. The demonstrators posted the notice on t= he=20 chain-link fence and staged about a 40-minute rally before dispersing.=20 The symbolic notice was meant to emphasize the groups' discontent with=20 skyrocketing power prices during the past year the use of state budget mon= ey=20 for power purchases and the activists' desire to have the state take over= =20 power plants to stabilize market prices.=20 The money they're making off of us is criminal said Loni Baker one of t= he=20 marchers. They're greed is taking money away from our kids' schools.=20 Representatives of Arlington Va.-based AES Corp. which owns the plant d= id=20 not immediately return calls seeking comment.=20 Last month the U.S. Justice Department opened an antitrust investigation= =20 into a power sales partnership between AES and Williams Energy the Tulsa= =20 Okla.-based company that sells power for AES under an exclusive marketing= =20 agreement.=20 Both companies have denied wrongdoing but in May Williams agreed to refund= =20 $8 million after the Federal Energy Regulatory Commission accused of the=20 company of temporarily closing AES plants to drive up power prices.=20 Davis asks PUC to let utilities cut voltage=20 1% savings on energy consumption predicted=20 David Perlman Chronicle Science Editor Wednesday July 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N29133.DTL=20 Gov. Gray Davis asked the Public Utilities Commission yesterday to allow=20 electric companies to lower voltage levels on power lines delivering=20 electricity to consumers this summer.=20 The move will save about 1 percent in the state's electricity consumption= =20 the equivalent of building a new 500-megawatt power plant.=20 Lowering voltages by 2.5 percent will prove barely noticeable by domestic= =20 users who might see their incandescent light bulbs dim slightly.=20 Refrigerators and electric motors such as those that run air conditioners= =20 should operate more efficiently on the lower voltages experts said.=20 The move should save consumers about 1 percent on their electricity bills= =20 according to Energy Commissioner Arthur Rosenfeld.=20 With support already promised by the state's major power companies the PUC= =20 is expected to approve the change in its voltage rules within weeks Robert= =20 Kinosian energy adviser to PUC President Loretta Lynch said at a Sacramen= to=20 press conference.=20 Similar voltage decreases have gone into effect in several other states=20 during power emergencies in recent years Rosenfeld said. But this is the= =20 first time it will occur statewide throughout an entire period of peak powe= r=20 demand.=20 PUC rules now require power companies to deliver between 114 and 126 volts = to=20 consumers all the time.=20 Less than two months ago Bill Wattenburg a maverick engineer and longtime= =20 consultant to the Lawrence Livermore National Laboratory assembled a team = to=20 test the effects on lights appliances microwave ovens and motors operatin= g=20 at voltages that were lowered by 5 percent or more.=20 At the press conference yesterday Wattenburg said those tests -- conducted= =20 with utility company senior engineers -- showed that no devices were damage= d=20 nor was their performance impaired. But cooking food on electric ranges --= =20 whether boiling water or making a roast reach a given temperature -- would= =20 take longer and consume slightly more power under any lowered voltage he= =20 said.=20 John Ballance director of network engineering at Southern California Ediso= n=20 said his company is equipped to control its voltage levels electronically a= nd=20 can lower them as soon as the PUC approves the change.=20 But Pacific Gas & Electric Co. operates differently and will have to change= =20 its voltage levels at each of its 2400 substations individually -- a task= =20 that could take several weeks Rosenfeld said.=20 This proposal may well achieve new efficiencies and reduce electric bills= =20 for California ratepayers Davis said in a statement. I urge the PUC to= =20 give it serious consideration.=20 E-mail David Perlman at dperlman@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 13=20 Federal price limits backfire=20 Some generators withhold power rather than abide by rate caps=20 David Lazarus Chronicle Staff Writer Wednesday July 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N186091.DTL=20 Officials in California and Nevada after months of lobbying for federal=20 regulators to cap Western power prices warned yesterday that the newly=20 imposed limits have had the unintended consequence of increasing a threat o= f=20 blackouts in the two states.=20 The warnings were issued as California came within minutes of rolling=20 blackouts yesterday afternoon and one day after the first-ever rolling=20 blackouts in Las Vegas forced energy-hungry casinos to shut off fountains a= nd=20 reduce air conditioning.=20 The two states are asking the Federal Energy Regulatory Commission to take = a=20 closer look at the so-called price mitigation plan and come up with revisio= ns=20 that would deter power companies from withholding electricity during=20 shortages.=20 We need some clarity to this order said Oscar Hidalgo a spokesman for t= he=20 California Department of Water Resources which is spending billions of=20 dollars to keep the state's lights on.=20 Generators need to be held accountable he said.=20 The crux of the problem is that price limits kick in during shortages yet= =20 power companies say these caps force them to sell power at below-market rat= es=20 during periods of high demand.=20 Some companies have responded by holding back power rather than face the=20 expense of shipping electricity from state to state. Each mile that=20 electricity must be transmitted adds to the overall cost.=20 No one's going to pay for transmission if the cost is near the caps said= =20 Gary Ackerman executive director of the Western Power Trading Forum an=20 energy-industry association in Menlo Park.=20 Ackerman said several companies in his organization decided that there was = no=20 economic advantage to offering power in regional markets when price control= s=20 are in effect.=20 This means individual regions like California or Las Vegas could end up no= t=20 having enough Ackerman said. It increases the threat of blackouts.=20 BLACKOUT ALERT CANCELED California authorities issued a blackout alert at 1:45 p.m. yesterday when= =20 power reserves dipped to dangerously low levels. They canceled the alert=20 about an hour later after finding additional supplies.=20 Everyone in the West is fighting for megawatts said Stephanie McCorkle = a=20 spokeswoman for the California Independent System Operator which oversees= =20 the state's power network.=20 The Golden State's latest brush with lights-out conditions came a day after= =20 Nevada experienced its own rolling blackouts for the first time prompting= =20 heavy power users such as the MGM Grand and Caesars Palace to dim their=20 lights.=20 Don Soderberg chairman of the Nevada Public Utilities Commission said tha= t=20 the sudden power emergency took state authorities by surprise and that they= =20 are investigating to see what role the federal price limits may have had in= =20 exacerbating Monday's shortage.=20 We're looking very closely at this he said. There seems to be a potenti= al=20 for unintended consequences.=20 Specifically Soderberg said Nevada is focusing on operators of older less= -=20 efficient plants who would find profit margins shrinking if not vanishing= =20 under capped prices.=20 We're going to see how the caps might have played into this he said.=20 The federal ceiling in 10 Western states excluding California is about $9= 2=20 per megawatt hour. In California a 10 percent surcharge is added because o= f=20 the state's credit risk bringing the price to just over $101.=20 Ackerman at the Western Power Trading Forum said regional price controls ha= ve=20 extended California's power crisis to neighboring states.=20 California sneezed and the rest of the region caught the virus he said.= =20 'LAWYERS LOOKING FOR LOOPHOLES'=20 California and Nevada officials however said that they still have faith= =20 that price limits can stabilize Western electricity markets but that federa= l=20 regulators may have to tweak the system so that power companies cannot=20 withhold output.=20 The generators have banks of lawyers looking for loopholes (in the plan)= =20 said Hidalgo at the Department of Water Resources.=20 Unfortunately it may take some time for the regulators to revisit an issue= =20 that they took up only with the greatest reluctance. For months federal=20 regulators refused to impose price controls preferring instead to let supp= ly=20 and demand determine costs.=20 Hidalgo said that when it appeared that power companies were throttling bac= k=20 on output Monday California officials immediately dialed the hot line numb= er=20 provided by the Federal Energy Regulatory Commission in case of emergencies= .=20 No one answered he said. They were closed.=20 State officials tried again yesterday and this time were told that the=20 commission would look into the matter. They were not given a time frame for= =20 when the commission might come up with a response.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 Two more energy whistleblowers slated to come forward=20 DON THOMPSON Associated Press Writer Wednesday July 4 2001=20 2001 Associated Press=20 URL:=20 tate0 336EDT0118.DTL=20 (07-04) 00:36 PDT SACRAMENTO (AP) --=20 Two more former workers at a San Diego-area Duke Energy plant are slated to= =20 talk with state investigators Thursday echoing concerns by other employees= =20 over how the plant was run when the state needed its power most.=20 However another former worker at the Chula Vista plant said he discarded= =20 perfectly good equipment three to five years ago while the plant was still= =20 owned by San Diego Gas and Electric.=20 Stuff that cost $3- to $5000 we were throwing away said Don Perkins of= =20 Alpine a mechanic at SDG&E plants for nearly 25 years.=20 That undercuts testimony from other former workers who told the Senate Sele= ct=20 Committee to Investigate Price Manipulation of the Wholesale Energy Market= =20 last month that they discarded valuable repair parts on the orders of Duke= =20 supervisors.=20 Like the other former SDG&E employees who have come forward Perkins was no= t=20 hired by Duke when it took over full operation of the plant in April. Perki= ns=20 said he is happy in retirement but like his former co-workers believes Duk= e=20 was driving up energy prices -- which the company vehemently denies.=20 He and the three other former workers suggested Duke did not adequately=20 maintain its equipment leading to unnecessary repairs they said cut power= =20 generation and may have helped boost prices by cutting supply. That include= d=20 running a 15-megawatt jet-fuel fired turbine until it broke down.=20 We ran the heck out of the plant you bet we didresponded Duke spokesman= =20 Tom Williams. But he said the plant had fewer outages under Duke's ownershi= p=20 than while it was owned by SDG&E.=20 Duke eventually had to completely rebuild the jet-fuel fired turbine=20 Williams said.=20 It ran more last year than the previous 37 years combined because the sta= te=20 needed the power Williams said.=20 An attorney for Lt. Gov. Cruz Bustamante who is to introduce the two new= =20 whistleblowers Thursday said they will echo their co-workers complaints th= at=20 maintenance slipped once Duke took over the plant.=20 Williams dismissed the news conference as a media event and the workers'= =20 complaints as old news the company has rebutted since the earlier testimony= =20 before the committee.=20 2001 Associated Press ?=20 Davis seeking cheaper contracts=20 Posted at 10:33 p.m. PDT Wednesday July 4 2001=20 BY JOHN WOOLFOLK=20 Mercury News=20 California officials are asking energy companies for better deals on the=20 state's long-term power contracts as a way to settle a dispute over billion= s=20 of dollars in electricity costs from the past year Gov. Gray Davis said=20 Wednesday.=20 In closed-door Washington D.C. settlement talks scheduled to conclude=20 Monday state officials are demanding that energy companies forgo $8.9=20 billion in bills for electricity that the state argues was overpriced.=20 But Davis during a San Jose visit Wednesday said the state would consider= =20 accepting some of that refund in the form of cheaper long-term contracts a= =20 move that could appease critics who say the $43 billion deals cost far too= =20 much.=20 The governor's comments shed light on the state's bargaining strategy in th= e=20 negotiations. Few details have emerged from the talks since the judge=20 overseeing them imposed a gag order.=20 ``We've made suggestions we've offered various ways in which people could= =20 get us $8.9 billion'' Davis said. ``We've said it doesn't have to be all= =20 cash. You can give it to us in lower contract prices than you otherwise wou= ld=20 have given to us. You can renegotiate our existing contracts and save us=20 money. However you want to do it it's just got to net out to $8.9 billion.= ''=20 It's unclear how those offers have been received by energy suppliers who= =20 have insisted their prices were fair given the uncertainty over whether the= y=20 would ever get paid. Several major companies including Duke Energy and=20 Enron say they're owed millions of dollars from the state and its major=20 utilities.=20 Paula Hall-Collins a spokeswoman for Williams Companies which signed=20 several contracts with the state in February to deliver power over the next= =20 10 years said she could not comment.=20 But one industry official said it was encouraging to see the governor show= =20 some flexibility and that the concept seems reasonable.=20 ``We take that as a positive'' said Gary Ackerman executive director of t= he=20 Western Power Trading Forum a trade association. ``If he wants to talk som= e=20 trade-off in renegotiating the contracts that doesn't seem to be totally o= ut=20 of hand. We're not going to turn away any serious offer.''=20 But Ackerman said the state needs to give a little on its refund target.=20 The $8.9 billion a figure estimated by the state's power grid analysts for= =20 sales from May 2000 to May 2001 has been widely challenged by industry=20 leaders. Even the judge overseeing the settlement talks said it's probably= =20 too high.=20 ``I don't think it serves the state of California for the state to hold fas= t=20 to a number any more than it does for my members to do the same'' Ackerma= n=20 said. ``It just doesn't get to a solution. There's got to be some give and= =20 take and we certainly haven't heard that until now from the governor.''=20 The state began buying electricity in January for its largest utilities aft= er=20 they became so saddled with debt from high power prices that energy compani= es=20 refused to sell to them. The state has spent about $8 billion since then in= =20 daily and short-term purchases.=20 The Davis administration signed $43 billion worth of electricity contracts= =20 with 18 energy suppliers for power over the next 10 years and has dozens of= =20 deals pending. The contracts are aimed at lowering the amount of power the= =20 state has to buy in daily markets where prices have soared.=20 Davis has credited the contracts with lowering the state's power costs from= =20 $100 million a day or more in May to about $33 million a day. His chief=20 energy negotiator S.?David Freeman has said he's proud of the contracts.= =20 But Davis has faced blistering criticism about the deals from Republican=20 lawmakers state Controller Kathleen Connell and consumer advocates who sa= y=20 the contracts will soak consumers with high electricity prices for many=20 years.=20 Davis initially sought contracts at prices around $55 per megawatt-hour bu= t=20 the deals signed so far average $70 per megawatt-hour.=20 That was a bargain earlier this year when daily prices averaged more than= =20 $200 per megawatt-hour. But average daily prices have since fallen to $89= =20 during peak hours and as low as $56 during low-demand periods.=20 The average daily price in 1999 was about $30 per megawatt-hour.=20 If the state and power suppliers cannot reach an agreement by Monday they= =20 can request an additional 10 days. Otherwise the judge will recommend a=20 settlement and the five-member Federal Energy Regulatory Commission will vo= te=20 on it.=20 So far the two sides still seem far apart.=20 ``It's very very difficult'' said Davis who named the state's negotiator= s=20 to the Washington talks. ``We'll see on Monday whether or not agreements ar= e=20 made. My hope is that a settlement will be reached. It's possible one will= =20 be.''=20 Contact John Woolfolk at jwoolfolk@sjmercury.com or (408) 278-3410.=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: COMPENSATION Body:: could you look into this for me? ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: recent developments Body:: Will we capture these accelerations in our accomplishments? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Letter to Lynch from Us Describing Info ISO should release sooner Body:: nan What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Senator Dunn Hearing Body:: Can you circulate the link to Cal TV again? Scott Govenar on 07/16/2001 01:58:41 PM Please respond to To: Ban Sharma David Leboe Eric Letke Jennifer Thome Ken Smith Bev Hansen Hedy Govenar Miyung Buster Janel Guerrero Robert Frank Mike Day Leslie Lawner Harry. Kingerski@enron. com Karen Denne Steven Kean Alan Comnes Susan J Mara Paul Kaufman Jeff Dasovich Jim Steffes Rick Shapiro cc: Subject: Senator Dunn Hearing THE SELECT COMMITTEE TO INVESTIGATE PRICE MANIPULATION OF THE WHOLESALE ENERGY MARKET WILL MEET ON WEDNESDAY JULY 18 AT 9:30 A.M. IN ROOM 3191 TO REVIEW COMPLIANCE WITH SUBPOENAS FOR DUKE DYNEGY RELIANT AES NRG AND WILLIAMS. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Lobbying Questionnaire Clarification Body:: can you fill this out for me? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions - 05/03/01 Body:: ENRON PLANT HEARING PLANNED FOR TONIGHT South Florida Sun-Sentinel 05/03/01 Would buying boycott help lower California's electricity bill? Associated Press Newswires 05/03/01 INDIA: Indian banks appeal to govt to help end Enron row Reuters 05/03/01 DNC: Special Interests Write Bush Energy Policy PR Newswire 05/03/01 UK: INTERVIEW-Innogy starts trading power in mainland Europe Reuters 05/03/01 Mosaic Group posts strong first quarter results Canada NewsWire 05/03/01 European Phone Companies' Outlook Brightens: Rates of Return Bloomberg 05/03/01 UK:Corporates warm to charms of credit derivatives Reuters 05/03/01 Allegheny Energy buys three power plants Associated Press 05/03/01 Allegheny Energy Buys Midwest Capacity From Enron Unit Dow Jones 05/03/01 Allegheny Energy Supply Completes Purchase of Midwest Assets Adds 1700 MW to Growing Generation Fleet Business Wire 05/03/01 SSB Cuts Forecast For Power Profitability In 2002 Beyond Dow Jones 05/03/01 Fitch Affs Northern Border Rtg Outlook To Stable From Negative Business Wire 05/03/01 INDIA: UPDATE 1-Enron to meet govt panel over Indian project Reuters 05/03/01 India State Panel's Sat Meet With Enron Unit Postponed Dow Jones 05/03/01 EnergieKontor Secures Enron Deal For Spain Germany Projs Dow Jones 05/03/01 The Bottom Line: Scottish Power Looks To Refine Focus Dow Jones 05/03/01 LOCAL ENRON PLANT HEARING PLANNED FOR TONIGHT Staff Reports 05/03/2001 South Florida Sun-Sentinel Broward Metro 3B (Copyright 2001 by the Sun-Sentinel) Pompano Beach A town meeting will be held tonight on Enron Corp.'s power plant proposal for Pompano Beach. Called by Commissioner Kay McGinn the meeting will be open to anyone who wants to speak. The City Commission is to vote Tuesday on whether to approve a zoning variance for the project. The meeting will be held at 7 p.m. at the Pompano Beach Civic Center 1801 NE 6th St. Would buying boycott help lower California's electricity bill? By MICHAEL LIEDTKE AP Business Writer 05/03/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. SAN FRANCISCO (AP) - There's a limit to how much people will pay for most things in life. If the cost scares off enough buyers prices eventually fall. So what would happen if this textbook example from Economics 101 were applied to California's electricity crisis? What if the state officials struggling to maintain energy supplies simply refused to buy power above a certain price and accepted more blackouts this summer? The question would have been absurd just a few months ago and even now the notion seems surreal given the possible consequences. Inviting even more blackouts inevitably would hurt businesses and frustrate consumers threatening to further depress California's already slumping economy - the sixth largest in the world. But desperate times require drastic measures according to the economists lawmakers and activists who believe the state will be better off sitting in the dark than buying electricity at any price during a summer shortage likely to produce recurring blackouts anyway. It's better to use (blackouts) and break the (wholesale energy) cartel than simply to suffer them said Michael Shames executive director of the Utility Consumer Action Network a San Diego watchdog group. Refusing to buy enough power to keep the lights on would be like playing with fire counters Wells Fargo & Co. chief economist Sung Won Sohn. Blackouts aren't a just matter of inconvenience or being too hot or cold. They cost businesses a lot of money. Buying electricity at the last minute to meet the state's power needs already has cost the California government $5.7 billion in the past 3 1/2 months. The state energy bill for 2001 could reach $50 billion in money otherwise spent on education public safety and health care Shames said. Faced with the prospect of a significant budget deficit some lawmakers think it's time for California to take a stand against the power wholesalers - many of whom are based outside the state. This Tuesday the state Senate Energy Committee will consider authorizing the state to refuse to buy power above certain prices. Current law requires state electricity managers to avoid blackouts by buying all available power at any cost. We have been over a barrel in so many ways said Sen. Dede Alpert D-Coronado who sponsored SB73x. Maybe there's a point in the market where (we) just say no and go with the planned blackout strategy instead. Economists give the bill little chance of succeeding. It's never going to happen. It's not a viable option said University of California at Berkeley Professor Severin Borenstein one of the energy experts who have studied the idea. The business lost during blackouts would mean more layoffs in a state already skittish over the technology downturn and the looming Hollywood writers strike economists say. Other ripple effects include diminished gasoline supplies leading to even higher prices at the pump and distribution headaches that could leave store shelves bare. And some consumers - the elderly and the infirm for example need power at any price. Without electricity Manteca resident Betty Jarzemkoski said she wouldn't be able to help her ailing husband to get out of his motorized bed at home. It would be a real hardship for us said Jarzemkoski 78. I'm on a fixed income so I hope they can figure out something to bring down prices. But we need power. Despite such concerns the concept of a buyer's boycott hasn't been flatly ruled out - at least publicly - by Gov. Gray Davis as he struggles to reduce the state's staggering electricity bill. The state is spending as much as $90 million per day to meet California's electricity needs and the bleeding is sure to get worse. When the summer heat increases demand and tightens supplies California might spend more than $1 billion each week state officials estimate. Extended blackouts pose an even greater cost economists say. When Northern California suffered rolling blackouts for several hours Jan. 18-19 the economic losses totaled $2.3 billion mostly from lost profits and wages estimated the Los Angeles Economic Development Corp. Multiply that over several weeks across the entire state and it becomes apparent why it makes more sense for California to continue buying power at inflated prices even if leaves the state with deep debts and a ruined credit rating economists argue. As it is California probably won't be able to round up enough power at any price on some days this summer making some blackouts a virtual certainty. The blackouts will reduce the state's economic output by $2 billion to $16 billion according to a study released last month by the Bay Area Economic Forum. The resolve of the state's politicians and ratepayers would be sorely tested for a boycott to succeed much in the way that labor strikes boil down to whether workers or management can withstand more financial pain. Politicians aren't going to willingly turn out the lights because politicians want to get re-elected said Borenstein director of the University of California's energy institute. As soon as people start losing their jobs because the power is off the public will get tired of the blackouts real quick. Still Californians might tolerate an increase in blackouts if they understand why the state chose to pursue such a drastic course said Stanford economics Professor Frank Wolak who heads the Independent System Operator's market surveillance committee. This isn't something you could do without an enormous public relations campaign he said. The campaign would have to explain that the state had no other choice but to do this because (federal power regulators) aren't doing their job and enforcing the law against unjust and unreasonable prices. The largest out-of-state generators are in such robust financial shape that it might take weeks before they would feel such pain from a California boycott that they would be forced to lower prices. After making record profits last year power wholesalers Enron Reliant Dynegy Duke Energy Williams and Mirant and earned a combined $1.6 billion during the first three months of this year. --- On The Net: Bay Area Economic Forum report: Electric Power Research Institute: http://www.epri.com Utility Consumers' Action Network Report: INDIA: Indian banks appeal to govt to help end Enron row 05/03/2001 Reuters English News Service (C) Reuters Limited 2001. BOMBAY May 3 (Reuters) - Indian lenders to U.S. energy group Enron Corp's gas-fired power plant south of Bombay have appealed to the Indian government to help end the company's row with a state-owned electricity board over pricing and upaid bills. The board of Enron's Indian unit Dabhol Power Co (DPC) has authorised management to stop selling power to the Maharashtra State Electricity Board (MSEB) if a bitter dispute over pricing and unpaid bills cannot be resolved. In the past half year the MSEB has defaulted on bills for electricity supplied by Dabhol which operates the world's largest gas-fired plant on the west coast of India 160 kilometres (100 miles) south of Bombay. Indian financial institutions which contributed $1.4 billion towards the project in loans are pressing the government to help end the crisis a source told Reuters. We have asked the government for help. We are awaiting their reply the source who is employed with a large financial institution said. The domestic lenders to the project are Industrial Development Bank of India ICICI Ltd Industrial Finance Corporation of India Canara Bank and State Bank of India . The Dabhol Power Company (DPC) owned 65 percent by Enron last month took the major step of bailing out of the $2.9 billion power project citing non-payment of bills by the Maharashtra State Electricity Board (MSEB). The DPC board's move sparked widespread fears that India's image as a safe destination for foreign direct investment would be damaged. POWER STRUGGLE MSEB which is a state-owned utility has been a regular defaulter on payments to DPC saying that it finds the power too costly. It has also backed out on its commitment to buy more power to be produced by the project's second phase which is to begin operations later this year. Last month MSEB said it had paid Dabhol Power 1.34 billion rupees ($28.60 million) for electricity it bought in March. But the payment only partially resolves the total overdue amount of 2.26 billion rupees ($48.2 million) which Enron has been unable to collect even after invoking guarantees issued by the government of Maharashtra India's most industrialised state and the federal government. The state utility still owes Enron payments for power purchases in December and January. The Indian government has maintained that the contract must be renegotiated and has set up a committee to do so. We are concerned and would like the renegotiations to happen fast the source added. The dispute has raised fears that Enron could pull the plug on the project cease providing power to the local state electricity board and perhaps even sell the plant. The plant is good Maharashtra needs power and I am sure buyers can be found the source added. ($1=46.82 Indian rupees). DNC: Special Interests Write Bush Energy Policy 05/03/2001 PR Newswire (Copyright (c) 2001 PR Newswire) WASHINGTON May 3 /PRNewswire/ -- The Democratic National Committee issued the following today: Dick Cheney began dropping hints this week as to what the Bush energy policy will look like and it is long on oil and short on conservation. But something was missing from the coverage of Cheney's announcement: not just who benefits from the Bush plan but who's writing it as well. (Photo: ) It's hard to understate the influence big donors and high-ranking executives have with the Bush Administration. Take Tom Kuhn for example one of the energy executives who came calling when Bush was thinking about actually following through on his pledge to limit carbon dioxide levels. Kuhn a top Bush fundraiser also served on Bush's Energy Department transition advisory team and still enjoys access to the highest reaches of the Bush White House. Not surprisingly then the Big Oil Bush Administration's energy policy could not make Bush's huge donors and the special interests in the energy business any happier. Since the energy industry's problems are Bush's problems the first things on Bush's hit list are the environmental regulations that keep Big Energy in check -- and our country clean. With an energy executive running around the West Wing Bush's energy policy could be summed up as Drill anywhere anytime and keep those checks coming. The Democratic Party is committed to fighting for a balanced energy policy that keeps our country's priorities -- such as a clean environment -- in mind. To learn more about Bush's misplaced priorities and kowtows to the special interests keep reading to find out the Top Ten Paybacks To The Energy Industry and to see how you too can get on the Bush gravy train in Recipe for a Quid Pro Quo courtesy of the Democratic Party's http://www.100DaysofBush.com. BUSH'S TOP TEN PAYBACKS TO THE ENERGY INDUSTRY One of the most obvious and recurring themes of Bush's first 100 days has been the extraordinary influence the oil and gas industry has had in the new administration. Oil and gas interests are some of Bush's top campaign contributors giving more than $3 million to get Bush elected. In exchange Bush has rolled back regulations issued by the Clinton administration on such things as air conditioner efficiency as well as breaking his campaign promise to regulate carbon dioxide emissions. Bush has proposed drilling in the Arctic National Wildlife Refuge and national monuments. Bush has taken a backseat when it comes to the energy crisis California is experiencing while cutting funding for energy conservation programs. He has also repaid top donors lobbyists and industry officials with key positions throughout his administration. Here is just a sampling of how the oil gas and other energy industries have benefited in Bush's first 100 days: 2 - BUSH TAKES HANDS-OFF APPROACH TO CALIFORNIA CRISIS WHILE ENERGY COMPANIES MAKE MILLIONS Bush Did Little to Aid California in Energy Crisis Fleischer Said Crisis is a California Matter. Bush has done little to aid California in its energy crisis such as refusing to support wholesale price caps on electricity. White House spokesman Ari Fleischer said The president continues to believe that the issue is mostly a California matter dealing with the legislation that is before the state. And the leaders of California are working to address that in their own right. Fleischer also said that Bush wanted to focus on a long term national energy policy. (AAP Newsfeed 1/23/01 Wall Street Journal 1/23/01) Texas Energy Company Accused of Price Gouging to Make Money off California's Energy Crisis. The Federal Energy Regulatory Commission ordered further inquiry into allegations by California officials that El Paso Natural Gas Co. a Houston based subsidiary of El Paso Energy Co. manipulated the natural gas market by keeping supply artificially low contributing to the high price of electricity in the state. El Paso Energy was one of the Texas firms grandfathered by Bush's voluntary emissions standards in Texas. Between 1993 and 1998 El Paso Energy and El Paso Natural Gas PACs gave a total of $8000 to Bush's gubernatorial campaigns. During the 1999-2000 election cycle El Paso Energy Corp. and El Paso Natural Gas Co. gave a total of $743029 to Bush and the GOP -- $460395 to GOP in soft money $247750 to GOP candidates from its PAC and $34884 to the Bush campaign from its employees and executives. (www.opensecrets.org Los Angeles Times 3/30/01 tebb.epenergy.com Boston Globe 10/3/99) Electricity Wholesalers Reported Gigantic Earnings Surges from Energy Crisis. According to the Los Angeles Times several electricity wholesalers to California reported gigantic earnings surges for the quarter ended March 31. The following companies all contributors to Bush have earned record profits off of the energy crisis in California. (Los Angeles Times 4/18/01) COMPANY TOTAL TO BUSH COMPANY PROFIT Enron Corp. Enron is Bush's largest Enron's operating income was career patron giving at $406 million in the first least $563000 for his quarter of 2001 compared campaigns including his with $338 million in the 1978 House campaign. same period last year a 20% (San Diego Union-Tribune increase.(Los Angeles Times 2/11/01) 4/18/01) 6 - BUSH'S TRANSITION TEAMS Energy Interests Dominated Bush Transition Energy Advisory Team. Big energy and oil firms dominated the Bush transition's Energy Advisory Team having contributed $857232 to the Republican Party and Bush during the campaign. (Center for Responsive Politics www.crp.org) Almost Two-Thirds of Bush's Energy Transition Team Worked for Energy Industry. Out of the 48 members of the Bush Energy Department transition team 31 or almost two-thirds worked for the energy industry: NAME EMPLOYER Brian Bennett Southern California Edison Robert Card Kaiser Hill Steve Chancellor Black Beauty Coal Company Joe Colvin Nuclear Energy Institute Don Duncan Phillips Petroleum Company Tom Farrell Dominion Energy Gay Friedman Interstate Natural Gas Association of America Jack Gerrard National Mining Association J. Roger Hirl Occidental Chemical Corporation Hunter Hunt Hunt Power L.P. Jerry Jordan Independent Petroleum Association of America Buddy Kleemeier Kaiser Francis Oil Company Tom Kuhn Edison Electric Institute Ken Lay Enron Albee Modiano U.S. Oil and Gas Association David N. Parker American Gas Association C.J. Pete Silas Phillips Petroleum Company Gary Ellsworth USEC Inc. Buck Harless International Industries Stephanie Kroger Mayor Day Caldwell & Keeton (lobbies for companies in oil and gas industries www.mdck.com) Joe Farley Balch & Bingham (lobbying firm which focuses on managing and operating utilities of all kind www.balch.com) Bill Martin Washington Policy and Analysis (lobbying firm which represents American Gas Association www.influenceonline.net) The Honorable Howard Baker Baker Donelson Bearman Caldwell (lobbying firm dealing with energy industry www.bakerdonelson.com) Erle Nye TXU Electric and Gas Corporation Gregg Renkes The Renkes Group (lobbies for members of industry including Edison Electric Institute www.influenceonline.net) Dick Silverman S.R.P. Matt Simmons Simmons & Co. International John Tuck Baker Donelson Bearman Caldwell (lobbying firm dealing with energy industry www.bakerdonelson.com) Daniel Yergin Cambridge Energy Research Associates The Honorable Thomas C. Merritt Merritt Tool Company Inc. (Oilfield Service Business Inside F.E.R.C.'s Gas Market Report 5/5/95) John Wootten Peabody Group Coal Executive Irl Engelhardt was an Energy Advisor to the Bush-Cheney Transition gave $100000 to Inaugural Fund. Irl Engelhardt of Peabody Group Inc. served as an energy advisor on the Bush-Cheney transition. During 1999- 2000 the Peabody Group gave $250000 to the Republican National Committee and Irl Englehardt personally gave $100000 to the Bush-Cheney Inaugural fund. (Washington Post 3/25/01 www.crp.org) /CONTACT: Jenny Backus of the Democratic National Committee 202-863-8148/ 11:47 EDT UK: INTERVIEW-Innogy starts trading power in mainland Europe By Stuart Penson 05/03/2001 Reuters English News Service (C) Reuters Limited 2001. LONDON May 3 (Reuters) - British utility Innogy said on Thursday it had started trading wholesale electricity on the French-Italian border and was set to enter the German power market. We have done some wholesale trading on the Italy-France border moving power from France to Italy and we are very close to doing some in Germany said director of trading Tony West in an interview with Reuters. This year we will significantly increase our trading in (mainland) Europe we are discussing relationships with counterparties at the moment he added. Innogy is building a European power trading team at its headquarters in Swindon southern England from where it already trades the UK gas and power markets. FRANCE COULD BE KEY MARKET West said the company initially had expected the main focus of its European trading strategy to be Germany and the north west of the continent. But the early signs were that France would also play a key role particularly as Innogy had gained access to capacity in the UK-France undersea interconnector cable. France has taken me by surprise. It might be more important than we anticipated although there are clearly still issues about the speed of liberalisation said West. A core of about eight companies regularly trade power in France including TXU Europe Enron and a trading alliance between Endesa and Morgan Stanley Dean Witter according to traders. West said Innogy had so far concentrated on buying power in France not always from French companies and taking it to Italy via the cross border interconnector between the two countries. Innogy had bought some of the 400-megawatts available on the interconnector through recent auctions he said. It's easy to trade through France the cost of taking power through to the border is minuscule although buying power in France and then selling it in France is a lot more difficult said West. He said Innogy had signed grid balancing agreements with French transmission grid operator RTE. Andy Duff managing director of generation and trading added France could become become important for Innogy on a retail level as well as a trading level depending on how effectively the UK-France interconnector could be used. The European market will be driven by the operation of interconnectors and transmission services as well as exchanges said Duff. Innogy may look to trade on Germany's two power exchanges as well as that country's burgeoning over-the-counter market. The company is in the process of signing standard trading agreements for Germany based on the terms devised by the industry group the European Federation of Energy Traders (EFET). FOCUS ON TRADING NOT ASSETS Duff said Innogy's strategy in Europe was to focus on trading but not the acquisition of physical assets. We are not going to lead with assets in Europe. We will focus on trading services-type arrangements extracting value from (other companies') assets. That's the main thrust of the business he said. West said Innogy's trading in mainland Europe would expand into natural gas as opportunities emerged. The company already trades around the UK-Belgium gas interconnector. Mosaic Group posts strong first quarter results 05/03/2001 Canada NewsWire (Copyright Canada NewsWire 2001) -- Diluted Cash Earnings per Share Increases by 29% and Revenues up by 89% -- TORONTO May 3 /CNW/ - Mosaic Group Inc. (MGX:TSE) Canada's leading outsourced marketing services agency announced today that it continued its trend of strong earnings growth for the period ending March 31 2001. Posting its 18th consecutive quarter of year over year revenue growth Mosaic has also reported an average quarterly organic growth rate of 27% since 1996. Financial highlights from continuing operations(x) for this quarter include: - Revenues at $171.8 million - up 89% or $80.7 million from Q1 2000. Mosaic has consistently outpaced the growth of its peers within an industry that is clearly expanding said Mike Preston Chairman and CEO Mosaic Group Inc. We have posted 18 consecutive quarters of continued growth while adding to our blue chip client list. We are building our business by taking our clients' business farther every time we deal with them. Our organic growth comes not only from securing new client wins but from the cross-selling wins that are characteristic of a mature company able to leverage a robust and diverse range of service offerings. New Client Wins In the first quarter of 2001 Mosaic's newly acquired business unit Paradigm has secured new client business worth between $20 million and $25 million a year in revenue. Combined with new client wins from Mosaic's other business units and increases in spending from some existing clients Mosaic has made significant progress in closing its new business gap for 2001. New Power --------- During the first quarter of 2001 Paradigm signed a contract with New Power to acquire residential and commercial customers through a variety of direct response channels such as outbound telemarketing inbound telemarketing direct mail and feet on the street. New Power was formed by Enron Corp. the largest buyer and seller of electricity and natural gas in North America. Paradigm had previously provided contract marketing services to New Power. Through diligent effort Paradigm was able to expand the contract to include the performance-based customer acquisition component. /For further information: Please Contact: Clint Becker Chief Financial Officer Mosaic Group Inc. (416) 813-4275 email: Donna Cox-Davies Director of Communications Mosaic Group Inc. (416) 813-4279 Email: 16:10 ET European Phone Companies' Outlook Brightens: Rates of Return 2001-05-03 08:52 (New York) European Phone Companies' Outlook Brightens: Rates of Return London May 3 (Bloomberg) -- European telephone companies such as British Telecommunications Plc and Deutsche Telekom AG have improved their ability to pay back debt in recent weeks making their bonds a buy investors said. ``Sentiment seems to be changing'' said Anna Lees-Jones who helps manage about 28 billion pounds ($40 billion) of corporate bonds at M&G Investment Management. ``I've been building up my telecoms position all year.'' British Telecom's 10-year euro-denominated bonds sold in January yield about 214 basis points more than government debt down from a record 238 in March. Contracts that pay out if the company goes bankrupt have also fallen in the past month according to Enron Corp. which trades the derivatives. Bond yields and bankruptcy derivatives have also declined for Deutsche Telekom and Royal KPN NV after the companies said they would sell assets to pay down debt that has pushed their credit ratings to record lows and weighed on their shares. Phone companies sold $100 billion of bonds last year to finance licenses and equipment for new mobile services. British Telecom said yesterday it will sell its stakes in Japan Telecom Co. and Spain's Airtel SA to Vodafone Group for 4.8 billion pounds. British Telecom may also sell as much as 7.5 billion pounds of shares to existing investors in a so-called rights offer according to Legal & General Group Plc one of the company's shareholders. Deutsche Telekom will sell assets such as cable television and a stake in Global One and Wind SpA Chief Financial Officer Karl-Gerhard Eick said last week. KPN the biggest Dutch phone company said on March 26 it plans to raise at least 5 billion euros from asset sales to lower debt. Those plans have helped shift investors' perceptions of the companies' creditworthiness money managers said. `Drastic Measures' ``At the beginning of the year the market was assuming telecoms companies would be downgraded from single-A to triple- B'' said Peter Harvey who helps run about $8.6 billion at F&C Management. ``Drastic measures such as deeply-discounted rights issues led investors to believe they will maintain their single-A status.'' The gap or spread between British Telecom's sterling denominated bonds maturing in 2006 and U.K. five-year government bonds has narrowed 50 basis points to 109 basis points in the past month. Spreads between Deutsche Telekom's 6.125 percent five- year euro bonds and German government debt narrowed 35 basis points to 107 in April. Bankruptcy Swaps Fall Those shifts in sentiment are also reflected in Enron's bankruptcy swaps where prices have fallen in the past month said Simon Brooks a trader at Enron. Enron prices the swaps using indexes that measure the probability of bankruptcy and the likely recovery rate in that event. The price is expressed as a percentage above a benchmark interest rate such as the London interbank offered rate or Libor. British Telecom bankruptcy swaps have declined to 66 basis points from 96 on April 1 Enron said. Bankruptcy swaps on Deutsche Telekom dropped to 78 from 100 while KPN's fell to 135 from 183. Over the same period France Telecom SA's declined to 70 from 100 and Telecom Italia SpA's fell to 94 from 119. British Telecom's bond yields may fall further relative to government debt analysts said. They still offer higher yields than those of rival Vodafone Group Plc which has the same ratings though with a stable outlook. While both companies have five-year euro-denominated bonds British Telecom's offer 55 basis points more yield. The rivals also both have bonds maturing in 2004 and Vodafone's yield about 23 basis points fewer. ``If BT retains their rating their spreads should be probably 20 to 30 basis points narrower'' said Brian Venables head of credit strategy at WestLB. ``Even though it has performed extremely well this year there is much greater potential for BT's debt.'' Debt Reduction Target Both Moody's Investors Service which rates British Telecom ``A2'' and Standard & Poor's which rates it ``A'' have those ratings on watch for further cuts after trimming them four rungs last year. The company's asset sales to Vodafone are ``definitely positive in terms of the rating assessment'' said Aidan Fisher who rates British Telecom for Moody's. In combination with the proceeds of a rights sale ``that would meet the target they set themselves this year -- that's quite a lot to achieve in a 12 month period.'' British Telecom has said it wants to slash its 30 billion pounds of debt by a third and fend off further rating cuts. Before companies such as British Telecom clarified their debt-reduction plans ``the world and his wife were underweight'' telecom bonds in March said Harvey at F&C. The investment firm has since raised its holding of telecom bonds to neutral from underweight relative to its benchmark he said. Bond yields ``were trading very much out of line to the rest of the market'' said Lees-Jones at M&G. Now ``they have come in quite a bit and will come in further.'' --Tom Kohn and Alice James in the London newsroom (44-20) 7330 7929 or at tkohn@bloomberg.net with reporting by Christine Harper /zls Story illustration: {CRED } to see credit analysis on Bloomberg. {BRITEL } for BT's bonds. {DT } for Deutsche Telekom's bonds. UK:Corporates warm to charms of credit derivatives By Tom Bergin 05/03/2001 Reuters English News Service (C) Reuters Limited 2001. LONDON May 3 (Reuters) - European corporates are beginning to turn to credit derivatives among the more esoteric and complex of financial instruments to hedge the risk their debtors won't pay up market participants said on Thursday. Credit derivatives are insurance-like tools that allow users to hedge the risk of default on a debt. They are mainly used by banks hedge funds and insurance companies to hedge or gain exposure to the risk of a bond issuer defaulting. Dealers said an environment of deteriorating credit quality and a growing awareness among corporates that credit derivatives offer certain advantages over established hedging tools was behind the increasing use of the instruments. The market remains small with only around a dozen non-financial European corporates regularly using credit derivatives to manage their credit portfolio at present. But market professionals predict they will one day become as commonplace in the corporate world as other hedging tools such as interest rate swaps and currency options. We see (corporate use) as a big growth area for credit derivatives maybe the biggest says Bryan Seyfried vice-president of Enron Credit in London. Enron Credit grew out of the efforts of energy company Enron Corp. to hedge its own credit risk portfolio and now specialises in marketing credit risk management solutions to other non-financial corporates. Ralf Lierow director of credit derivatives at Siemens Financial Services in Munich said the ability to buy and sell in a liquid market means credit derivatives offer a flexibility that established tools like credit insurance and forfaiting guarantees lack. Credit derivatives were are often cheaper than the alternatives too he added. This is not a trading book thing. For us the credit default swap is another tool for credit risk management Lierow said. HELPS OPERATIONAL UNITS DO MORE BUSINESS Siemens Financial Services acts as the centralised risk portfolio management operation for companies within the Siemens electronics and industrial group. It first started using credit derivatives in July 2000. Large companies like Siemens can have hundreds of millions of dollars in receivables on their books at any time. The efficiency with which these companies manage the credit risk on their receivables has an impact on their day to day business. The advantage for the operative area is that they can offload more receivables and do more business Lierow said. Siemens uses credit default swaps the most liquid type of credit derivatives to hedge its portfolio of debtors on a constant basis. As the balance of cash owed by each name fluctuates over time the company tries to match this with default swap positions. Hence if a customer fails to pay Siemens can recoup the debt from the default swap seller. Other companies use credit derivatives less frequently. There are occasional corporate users that have secured one-off requirements for balance-sheet management aims or to strip out the credit risk of a commercial transaction said Walter Gontarek head of global credit products at RBC Dominion Securities. By hedging a country or company risk which a corporate may not be comfortable in carrying a credit derivative can facilitate a project that may otherwise be unfeasible dealers said. NOT PUT OFF BY BAD PRESS Corporates' adoption of credit derivatives is in spite of the negative publicity the instruments have received in recent years. A number of disputes over whether protection buyers could force banks to pay up on contracts have ended up in court. However traders insist that subsequent work done on contract documentation minimises the risk of such disputes in future. Nonetheless a very practical concern for corporates remains in that credit derivatives documentation was designed by bankers with sovereign and corporate bonds in mind. The International Swaps and Derivatives Association (ISDA) standard documentation for credit default swaps allows for a pay-out in relation to defaults on bond payments but not on a private debtor's failure to pay. We use the ISDA framework but we need it redrafted in specific ways to fit our needs. You cannot take a standard contract and trade on it if you want to hedge trade receivables Lierow said. These amendments add to the cost of the credit derivative. Another problem that corporates face is the complexity of credit derivatives. There is little experience of the instruments which are barely a decade old in the corporate world. Siemens had to get its expertise from the financial markets hiring Lierow from Bankgesellschaft Berlin. Clive Banks UK head of derivatives sales to buy-side clients at Schroder Salomon Smith Barney said much of the effort in marketing credit derivatives to corporates involves educating them about the products and the risks involved. It's about explaining credit risk management and what kind of volatility and cost having credit risk introduces he said. OUTLOOK PROMISING Yet some corporates are beginning to take full advantage of their new tool. Lierow said that Siemens which currently only buys credit protection planned to start acting as a default swaps seller in the coming months. He said selling would facilitate better matching of protection levels to actual exposures and would enable diversification of risk away from industry sectors where the company's activities are concentrated. You could improve the portfolio mix by buying protection on automotives and selling protection on pharmaceuticals he said. Allegheny Energy buys three power plants 05/03/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. HAGERSTOWN Md. (AP) - Allegheny Energy Inc. said Thursday it has purchased three power plants from Houston-based Enron Corp. The company said it issued more than 14 million shares of common stock worth $667 million to pay for the transaction. The plants are in Tennessee Indiana and Illinois. The Midwestern purchase will bring an additional 1710 megawatts on line. The company is expected to own 14000 megawatts of generating power by 2005. Allegheny also has plans to build natural gas-fired facilities in Arizona Indiana and Pennsylvania. Allegheny Energy is the parent of Allegheny Power which supplies electricity and natural gas to 3 million people in Maryland Ohio Pennsylvania Virginia and West Virginia. Allegheny Energy Buys Midwest Capacity From Enron Unit 05/03/2001 Dow Jones News Service (Copyright (c) 2001 Dow Jones & Company Inc.) HAGRSTOWN Md. -(Dow Jones)- Allegheny Energy Inc.'s (AYE) Allegheny Energy Supply Co. unit purchased 1710 megawatts of natural gas-fired merchant generating capacity in three Midwest states from Enron Corp.'s (ENE) Enron North America unit. Financial terms weren't disclosed. In a press release Thursday Allegheny said it financed the acquisition through debt and equity and expects the purchase to add to earnings in 2001 excluding transaction costs. Allegheny noted that this latest acquisition gives Allegheny Energy Supply more than 14000 MW of total generating capacity that it will own or control by 2005. Allegheny Energy Global Markets will market output from the three facilities. On April 27 Allegheny priced its public offering of 12.4 million shares at $48.25 each and said it would use the $598.3 million in gross proceeds to fund its previously reported acquisition of generating facilities located in the Midwest and for other corporate purposes. New York Stock Exchange-listed shares of Allegheny recently traded at $49.85 down 51 cents or 1% on composite volume of 306000 shares. Average daily volume is 538773 shares. Allegheny which posted an operating net of $313.7 million or $2.84 a share on revenue of $4.01 billion for the year ended Dec. 31 is an energy company. Company Web site -Karen M. Chow Dow Jones Newswires 201-938-5400 Allegheny Energy Supply Completes Purchase of Midwest Assets Adds 1700 MW to Growing Generation Fleet 05/03/2001 Business Wire (Copyright (c) 2001 Business Wire) HAGERSTOWN Md.--(BUSINESS WIRE)--May 3 2001--Allegheny Energy Inc. (NYSE: AYE) today announced that its unregulated generation subsidiary Allegheny Energy Supply Company LLC has completed the purchase of 1710 megawatts of natural gas-fired merchant generating capacity in three Midwest states from Enron North America a wholly owned subsidiary of Enron Corp. (NYSE: ENE). The acquisition gives Allegheny Energy more than 14000 MW of total generating capacity that it will own or control by 2005 and marks a significant step in the Company's strategic course toward becoming a national energy supplier. Earlier this year Allegheny Energy Supply acquired 83 MW of coal-fired generation in the Conemaugh Generating Facility near Johnstown Pa. Additionally the Company has announced plans to build a 1080-MW natural gas combined-cycle plant in La Paz County Ariz. a 630-MW natural gas combined-cycle facility near South Bend Ind. and a 540-MW natural gas fired combined-cycle generating facility in Springdale Pa. Another 220 MW of peaking capacity have already been completed in Pennsylvania. The Midwest acquisition was financed through a combination of debt and equity and will be accretive to Allegheny Energy's earnings in 2001 excluding transaction costs and other costs related to the integration. Yesterday the Company issued more than 14 million shares of common stock to facilitate the transaction. Alan J. Noia Chairman of the Board President and Chief Executive Officer of Allegheny Energy said I am pleased to announce the closing of Allegheny Energy's largest generation acquisition to date. It provides our Company with significant generation presence and capability as an energy merchant to sell electricity from efficient natural gas-fired generation facilities in more areas of the country with a growing demand for energy. Output from the three facilities will be marketed by Allegheny Energy Global Markets. These premium generating assets are designed for operation in times of peak electricity demand said Noia. Because of its national presence Allegheny Energy Global Markets will be able to market the output from these newly acquired facilities in a wide variety of ways with our portfolio of existing assets and other supply arrangements so that overall operational efficiency and shareholder value is maximized. Allegheny Energy Supply's newly acquired facilities include: the Gleason Tenn. plant (546 MW) approximately 40 miles north of Jackson Tenn. the Wheatland Ind. plant (508 MW) approximately 70 miles northeast of Evansville Ind. and the Lincoln Energy Center plant (656 MW) in Manhattan Ill. near Chicago. These assets give Allegheny Energy Supply additional generating capacity within the East Central Area Reliability region (ECAR) and initial generation sources in the Mid-America Interconnected Network (MAIN) and the Southeastern Electric Reliability Council (SERC). Salomon Smith Barney acted as financial advisor and Jones Day Reavis & Pogue acted as legal counsel for Allegheny Energy for the acquisition. CONTACT: Allegheny Energy Supply Hagerstown (Media) Janice Lantz 412/858-1630 Media Hotline: 888/233-3583 or (Investors) Greg Fries 301/665-2713 11:35 EDT MAY 3 2001 SSB Cuts Forecast For Power Profitability In 2002 Beyond 05/03/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) NEW YORK -(Dow Jones)- Salomon Smith Barney's utility analysts sharply cut their forecast of the profitability of generating electricity in the U.S. in 2002 and beyond because power prices are expected to drop more sharply than natural gas prices starting next year. The analysts cut the profit margin in natural gas-fired power in 2003 to $3.98 a megawatt-hour from $8.73/MWh a 54% difference from their last forecast in February. They lowered their power price index for 2002 by 1.5% and for 2003 by 7.1% Thursday in a published report. Their forecast is based on forward markets for electricity and gas. Gas prices are remaining strong for a much longer period of time while power prices drop off senior electricity industry analyst Raymond Niles said in a telephone conference with investors. As a result stock prices for power producers such as AES Corp. (AES) Mirant (MIR) Calpine Corp. (CPN) and NRG Energy (NRG) could peak this summer in advance of strong third quarter earnings reports the Salomon report says. Investors may still shy away from asset and investment-heavy power producers if realized prices begin to reflect the decreases in power prices now projected in the forward curve the report warns. After this summer the stocks of energy companies that focus more on trading will regain momentum Salomon expects. These energy merchant companies such as Enron Corp. (ENE) Williams Cos. (WMB) Duke Energy (DUK) and Dynegy (DYN) should be able to take advantage of higher trading volume and greater volatility in power markets in non-summer months according to Salomon. We expect (annual trading) volumes to grow industry-wide between 25% and 40% on average during 2001-03 as the $800 billion global energy commodity market continues to open the report predicts. The overall electricity price trend is national according to Salomon. The report titled Power Curve expects 2001 wholesale power prices to exceed last year's by 131% in the West and by 34% on average in the eastern U.S. including Texas. But since their last forecast the analysts lowered their forward price curve for next year and beyond in 10 of 11 regional power pools. Interestingly the exception to that is the New York Power Pool Niles told investors. For the remainder of this year however Salomon still expects power producers to beat substantially last year's breakthrough results. About 50% of the spike upward in western U.S. power prices the past six months has been from something we've never seen before in this industry: political and credit risk Niles said in the conference. Western merchant power suppliers are benefitting from the unholy mess in California Niles said but that won't last forever. Whenever the debate tapers off and we have a resolution in sight that premium will slowly drain out of the western markets and bring down profitability for the group Niles said. National calls for reregulation due to the California crisis could continue to hurt stock prices for the entire sector even though reregulation won't happen. Further in so far as such calls discourage investment in generating plants transmission lines and gas pipelines they could also extend the current period of extremely high earnings according to the report. In non-western states the greatest profitability from power generation for the next two years is seen in New England. -By Mark Golden Dow Jones Newswires 201-938-4604 mark.golden@dowjones.com Fitch Affs Northern Border Rtg Outlook To Stable From Negative 05/03/2001 Business Wire (Copyright (c) 2001 Business Wire) NEW YORK--(BUSINESS WIRE)--May 3 2001--Fitch has affirmed its `BBB+' senior debt rating for Northern Border Partners L.P. (NBP) and its `A-` senior debt rating for its regulated pipeline affiliate Northern Border Pipeline Co. (NBPL). The Rating Outlook for both companies is changed to Stable from Negative. The rating action was taken after a review of NBP's recent acquisitions and long-term business plan. A combination of debt and equity at NBP was used to fund the recent acquisitions of Bear Paw LLC Midwestern Gas Transmission Company and Dynegy Canada midstream assets. An additional $125-150 million of equity is expected to be sold in the coming months to pay down short-term debt and complete the permanent financing. The improvement in Rating Outlook primarily reflects NBP's demonstrated commitment to undertake conservative long-term financing and operating strategies. Future acquisitions at the partnership level are expected to be financed 50/50 debt/equity so as to maintain financial flexibility and a stable credit profile. Moreover management has shown a strong bias to minimize commodity price risk as it expands its non-regulated gas operations. For example processing contracts for Bear Paw's four processing facilities are contracted for on a percentage of proceeds basis and liquids prices have been 90% hedged by NBP through 2001 limiting downside exposure. NBPL continues to exhibit strong competitive market operating and financial characteristics that are consistent with its current `A-` rating. The company is a low-cost transporter of Canadian gas into the Midwest with costs per hundred miles of less than 4 cents per mcf. The December 2000 completion of the Alliance Pipeline has had minimal impact on Northern Border as capacity utilization approaches 100%. Pipeline capacity is 99% subscribed through mid-September 2003. Its shippers are financially strong customers with uniform take-or-pay contracts. The company has never written off a bad debt. NBPL should generate EBITDA/interest coverage of nearly 4.0 times over the next few years. Credit concerns primarily relate to NBP's changing business mix and the expectation of increased market risk associated with its growing midstream operations as compared with the stable low-risk profile of NBPL. While projected consolidated and stand alone credit measures at NBP remain relatively strong there will be less predictability in the future cash stream utilized to service debt. NBP is a publicly traded master limited partnership. Its primary holding is a 70% economic interest in NBPL a 1214-mile FERC regulated interstate pipeline transporting natural gas from the Canadian border to the upper Midwest. Enron Corp. and The Williams Companies Inc. hold a 10.0% and 3.3% stake in NBP respectively with the remainder publicly held. Enron controls an 82.5% stake in the management committee of NBP with Williams holding the remaining management allocation. CONTACT: Fitch New York Ralph Pellecchia 212/908-0586 or Hugh Welton 212/908-0746 13:58 EDT MAY 3 2001 INDIA: UPDATE 1-Enron to meet govt panel over Indian project 05/03/2001 Reuters English News Service (C) Reuters Limited 2001. NEW DELHI May 3 (Reuters) - The Indian unit of Enron Corp said on Thursday that its officials would meet members of a government panel formed to re-negotiate a troubled $2.9 billion power project in western India. But the willingness to meet the panel next week should not be construed as an offer to renegotiate the contract Dabhol Power Company (DPC) said in a statement. As a matter of courtesy we have agreed to meet with them next week the DPC statement said. Since the purpose of our meeting is to hear out the committee and understand their thoughts we will not present any proposal. DPC said it had constantly maintained that it was open to maintaining a dialogue towards resolving issues. (But) This meeting should in no manner be construed as an open offer from DPC to renegotiate the terms of the contract it added. DPC and the government of the western state of Maharashtra have been locked in a payment battle for months with the state's electricity board balking at paying Enron what it considers too high a rate for electricity. At present Maharashtra's State Electricity Board (MSEB) owes the DPC of which Enron is a 65 percent stakeholder some $48 million for power. The Maharashtra government last week announced the formation of a panel of experts to re-negotiate its contract with DPC and lower the cost of power sold to MSEB. LARGEST FOREIGN INVESTMENT The Dabhol project the single largest foreign investment in India consists of two phases the already-built 740 megawatt power plant and a 1444 MW plant that is expected to be finished this year. Last week Dabhol's board authorised the plant's managing director to issue a preliminary notice of termination of service to MSEB. The notice which has not been issued would be the first step for Enron to pull out of the project. Earlier a source familiar with the project told Reuters that Indian lenders who have provided millions of dollars to Houston-based Enron to build DPC are lobbying with the government to act quickly and end the crisis. We have asked the government for help. We are awaiting their reply the source who is employed with a large financial institution said. The domestic lenders to the project are Industrial Development Bank of India ICICI Ltd Industrial Finance Corporation of India Canara Bank and State Bank of India . If Enron pulls out of the project the source said the lenders would have no choice but to seek an alternative buyer. The plant is good Maharashtra needs power and I am sure buyers can be found the source added. India State Panel's Sat Meet With Enron Unit Postponed 05/03/2001 Dow Jones International News (Copyright (c) 2001 Dow Jones & Company Inc.) NEW DELHI -(Dow Jones)- India's Maharashtra state government's expert committee's Saturday meeting with the U.S. energy major Enron Corp.'s (ENE) Indian unit Dabhol Power Co. has been postponed until May 11 at the request of DPC a committee member told Dow Jones Newswires late Thursday. The nine-member committee has been appointed to renegotiate the Maharashtra State Electricity Board's controversial power purchase agreement with DPC. The state government has asked the committee to try to negotiate a revised agreement within a month. The negotiating committee's first meeting with the Dabhol Power Co. management scheduled for Saturday has been postponed until May 11 0530 GMT at DPC's request. They (DPC) told us they wanted some more time to prepare themselves for the meeting and we have granted their request said a committee member. The committee's goals are to lower the power tariff and allow the sale of excess power to the federal government or its utilities. A restructure of the DPC's stakeholding may also be on the agenda. -By Himendra Kumar Dow Jones Newswires 91-11-461-9427 himendra.kumar@dowjones.com EnergieKontor Secures Enron Deal For Spain Germany Projs 05/03/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LONDON -(Dow Jones)- German wind farm developer EnergieKontor AG said Thursday it has signed a framework agreement with Enron Wind GmbH for deliveries of wind turbines for projects in Germany and Spain. In all Enron will deliver 200 megawatts' worth of 1.5 MW turbines for onshore projects in EnergieKontor's home market and in Spain one of its fastest-growing export markets. In addition Neuer Markt-listed EnergieKontor said it has entered into exclusive negotiations with the local authorities for permission to build up to 15 wind farms at a number of sites in the Castilla-La Mancha region. Each site would have an installed capacity of 45-50 MW making a total of 700 MW. Once we reach this stage there is about an 85-90% of the project going ahead sometimes more a spokesman told Dow Jones. EnergieKontor said it assumes that it will set up the first windfarms in Castilla-La Mancha as early as next year. -By Geoffrey T. Smith Dow Jones Newswires (+44 20) 7842 9260 -geoffrey.smith@dowjones.com The Bottom Line: Scottish Power Looks To Refine Focus By Andrea Chipman Of DOW JONES NEWSWIRES 05/03/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LONDON -(Dow Jones)- After more than a year of lagging earnings investment missteps and unexpected disasters U.K. vertically-integrated utility Scottish Power (SPI) is hoping a new strategy to streamline its businesses will signal a more focused period for the company. But it's got its work cut out. While investors were cheered by news that its U.S. Utah-based Hunter power plant is back online after a six-month outage that cost the company an estimated $160 million uncertainty over its plans for its Southern Water unit and apparent ongoing commitment to loss-making telecoms venture Thus are seen as muddling group focus. It all adds up - the lack of coherent strategy quite substantial downgrades and a whole host of non-core businesses that they don't have any natural management flair or expertise in said Brian Gallagher a senior fund manager at London-based Gartmore Investment Management which has GBP3 million of Scottish Power shares in its Global Utilities Fund. We have a reasonably low opinion of the company. The company said Thursday that its pretax profit before goodwill amortization and exceptional items for the fiscal year ending March 31 fell to GBP628 million from GBP736 million a year ago. Adjusted earnings per share declined to 30.65 pence in the 2001 fiscal year from 41.22 pence in 2000. The company acknowledged profits have been hit hard by the Hunter outage competition on wholesale and retail markets in the U.K. and strict price controls on its regulated infrastructure businesses. Although the company's shares were trading at 458.5 pence after the release of Thursday's earnings results up from 441.5 pence Wednesday they are down more than 15% from 533 pence a year ago. Executives say they are restructuring the business into three targeted divisions to capitalize on its traditional strengths in generation and power supply and infrastructure and to expand its overseas activities. We've now got a trading and commercial link between generation and supply and the first thing we are doing is putting emphasis on that...on growing earnings across that value chain Scottish Power Chief Executive Ian Russell told journalists in a conference call Thursday. In the U.S. we are focused on cost cutting and on acquiring new businesses. Scottish Power's move away from a full multi-utility profile - begun last year with its partial disposal of Thus and its withdrawal from an Internet banking venture with the Royal Bank of Scotland - toward a more narrowly focused energy business mimics a trend across the industry toward greater specialization. The company is also considering selling Southern Water which would allow it to focus even more closely on its power business. Yet analysts and investors say they are looking for more details of the company's overall growth strategy from Russell who took over as chief executive last month and other managers. The toll from months of drift is evident they said. Sales Of Southern Water Thus Seen Indeed despite its efforts to chart a new road Scottish Power appears to be reluctant to acknowledge the failure of some of its non-core ventures. Russell said his company remains supportive of Thus which reported a 2000 fiscal year loss of GBP21.4 million this week and has no plans to exit its remaining 50% stake in the company. Similarly he said Scottish Power hasn't yet made a final decision to dispose of Southern Water - which has cut costs under its Scottish parent but is increasingly unable to cover its capital expenditure - although he said the company had received a number of offers from potential buyers. Although he declined to identify any of the bidders Italian energy company Enel SpA (ENI) has confirmed its interest. Industry sources said a prompt sale of the water unit looks likely with some bids already exceeding the GBP2 billion at which many analysts value the company's combined assets and debt. It's unclear they said how Southern Water or Thus would fit into Scottish Power's new image. Scottish Power sees itself as an international energy company a source familiar with the company said. In a year's time he added it would be unlikely that Southern Water and Thus would be part of the company. Revenues from the sale of the water unit would also help Scottish Power pursue its U.S. expansion without adding to its 90% gearing levels analysts and investors said. Russell declined to comment on reports Scottish Power is considering buying Enron Corp.'s Oregon-based unit Portland General but admitted the company would be a logical geographical fit with Pacificorp. Analysts said Scottish Power's plans for U.S. growth is likely to be a key part of its energy strategy. We like their U.S. strategy where they've leveraged expertise gained in the highly competitive U.K. market said Gareth Lewis-Davies head of utilities research at Lehman Brothers in London. Closer to home competition and the trend toward increased specialization in the power industry may force Scottish Power to determine whether its business strength lies in asset management or retail and generation. Strategic decisions need to be made and I'm not sure if they are going to make them in the near term or not said Andrew Wright U.K. utilities analyst at UBS Warburg in London. They are pretty much involved across the value chain and I think it remains to be seen which part of the value chain they specialize in if any. Company Web site: www.scottishpower.co.uk -By Andrea Chipman Dow Jones Newswires 44-207-842-9259 andrea.chipman@dowjones.com What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Ive joined Charles River Associates Body:: Bill Yes one of the options I am looking at. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Privileged and Confidential - Catalytica Body:: I've finished marking up the drafts and thought perhaps a few thoughts would give you some insight into the reasons for my revisions . Unfortunately I was engaged in discussions about the course to pursue in light of Arthur Anderson's comments until almost 10pm when I lost my typing help so not much headway was made in inputting the changes last night. My secretary is supposed to be in early ( it is now nearly 8:00 and she still isn't in ! ) and I will enlist whatever other help I can get to turn these documents around. For those not involved in the discussions last night Roger advised us that Arthur Anderson had changes to the Xonon Technology Implementation Agreement designed to make clear ENA had no primary or secondary obligations under the XTIA. The principal change suggested by AA - the deletion of the last sentence of the BOLD language in Section 2.2 - removed the obligation for ENA to pick up any obligations under the agreement owed by West LB in excess of the Cap. Note that this same change applies in the Agreement in Principle related to the purchase of turbines. XTIA Revision 4G. AA's change did not appear to address comprehensively the principle AA espoused ie clarifying ENA had no primary or secondary obligations under the agreements. After much discussion and some consideration I decided to prepare alternative markups of the XTIA - one that attempts to meet the AA directive while preserving a level of comfort for GE. I attempted this by increasing the limit on West LB's liability in Article 10 to $20 million from $9.9 million so that GE's recourse against West LB is the same as it had against West LB and ENA in the prior drafts and by obligating West LB in the default provisions to pony up for an ENA default. I also extensively modified the Section 2.2 language ( taken verbatim from the LM 6000 deal ) to eliminate the limited recourse provisions favoring West LB and in doing so made it easier to conclude that references to ENA in the agreement are references to ENA acting in an agency and not its individual capacity. This notion is still pretty vague in the revision because I did not want to create too much discomfort in GE since ENA explicitly acting in an agency capacity would mean there was no recourse against it ( since ultimate recourse would lie with the principal West LB). Roger suggested I delete the limit on ENA's liability in Article 10 to remove the implication it had any which I did ( and which means we have no upside protection if we are construed to have obligations under the XTIA. The upshot is that in my opinion the 4g revision goes as far as possible toward placating AA while still retaining a possibility of selling it to GE. The sheer number of changes required by the substance of AA's comment however is bound to be disconcerting to GE at this stage of negotiations particularly when GE's expectation was for a markup incorporating the new business terms agreed yesterday afternoon (calling for payment of the Development Funds to be completed by September 302000 with the possibility of a refund of a portion of the Development Fund Payment if the December 31 Milestone is not timely completed) and some clean ups/clarifications. Note that in both revision 4g and 4ga Section4.3 now provides that the Xonon credit created is only exercisable by CCSI on and after December 312000 so that the credit amount can reflect the deduction of any Milestone 4 refund amount paid by GE if it does not complete that Milestone on time. I think the dollar value of the credit should be adjusted downward if a portion of the Development Funds paid on September 30 are in fact refunded in December. We need to make sure to make provision in the Acquisition and Development Agreement that any Milestone 4 refund received by West LB is paid over to ENA since West LB will have been repaid its advances on September 302000. XTIA Revision 4GA . This alternate revision to the XTIA takes a minimalist approach and incorporates only the new business terms some minor clean up/clarifications and the AA change to Section 2.2 and the change to Article 10 ( to remove a cap for ENA's laibility) suggested by Roger. It seems to me it does not address meaningfully the AA admonition that ENA may not have primary or secondary liability under the XTIA if it wants to stay outside of the rigors of FAS 97-10. However it has the singular advantage of looking a lot like what GE and West LB expect to see in the revision. Option Repurchase Agreement. This revision was complicated by the possible refund of the a portion of the Development Funds by GE if it failed to complete Milestone 4 by December 312000 ( an attempt to retain some accountability for GE's performance given that it is being paid for that Milestone on September 30 to satisfy CCSI ). Because the option repurchase must occur on or before September 30 it isn't clear what will happen December 31 so its hard to figure out what to pay if the contract is not cancelled by September 30 or what the credits are worth on that date. Since CCSI is the direct recipient of the credits under the XTIA I first thought ENA could hang onto $2.1 million ( the amount formerly allocated to Milestone 4 before its payment obligation was collapsed into Milestone 3) by deducting the refund from the amount payable to CCSI on the option repurchase date and leaving CCSI to bear the risk of GE's repayment of any refund in order to make CCSI whole. If GE did meet the Milestone on time and so did not pay the refund amount directly to CCSI I thought ENA could always make CCSI whole by paying the $2.1 million in December when the refund matter was decided. That approach- subtracting the refund amount from the September 30 payment to CCSI- was decidedly unsatisfactory since the option repurchase formula could result - depending on the Milestones paid on the option repurchase date - in a negative payment to CCSI for the option. What I settled on in this draft was to go ahead and pay CCSI the amount of the premiums it has paid to September 30 plus $200000 if the turbine contract has not been cancelled on September 30. This would include repayment to CCSI on September 30 of premiums paid by CCSI under the spark spread on September 30. Assuming CCSI made all its premium payments and West LB made all of its Development Fund advances ENA would have received $9.9 million from CCSI by September 30 paid out $9.9 million plus interest to West LB by September 30 and purchased the spark spread from CCSI for $10.1 million. If the turbine contract is not cancelled but GE has to pay the refund I think the $2.1 million ought to go to West LB or its designee (ENA). If we cancel the turbine contract and do not go forward with Pastoria the dollar amount of the credits vested in CCSI and exercisable after December 312000 are equal to the Development Funds advanced less the refund amount. Since the document now reads that the $2.1 refund amount goes back to West LB or its designee if GE pays the refund and CCSI is holding a Xonon credit of only $7.8 millionit seems to me it will be necessary to pay the refund over to CCSI instead of ENA in order to make up for the fact that it paid $9.9 in premium and only received $7.8 in credit in September. This quick liquidation of $2.1 of the credit seems to be an ancillary benefit to CCSI occasioned by GE's refund. We could provide in the agreements that GE makes this payment directly to CCSI or we can continue to have the right to receive the payment from GE under the XTIA and the obligation to pay it to CCSI under the Repurchase Agreement. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: slashing price caps Body:: Hey -- you're talking about our future President! I am soooo looking forward to my next Biennial Resource Planning proceeding. ----------------- What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Draft - Confidential - New Procedures to be introduced by ENA OTC for Exec Employment Agreements and Hiring of Commercial Staff below VP into ENA Body:: You should include VP's and also you should make it a little clearer that I don't want to be on the schedule unless they have made a decision. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Shift May Empower California.htm Body:: Thanks for taking time to call yesterday. Good luck with the Lockyer situ= ation. I truly do believe that direct and prompt interaction with Lockyer= will prove more effective for Enron than delayed or intermediated action.= As we discussed if I can be of any help with reconnaissance or as sou= nding board just let me know. =20 I have attached an article from this morning's LA Times. It provides an C= alifornia view on how the shakeup in the Senate might impact the state's e= nergy situation. Certainly by the time that President Bush visits the C= alifornia in a few days the state's two Democratic US Senators will be a = good bit more empowered. =20 Kevin 213-926-2626 =20 [IMAGE] [IMAGE][IMAGE] =09Click here to learn more! [IMAGE]=09 [IMAGE] =09Home | Discussions | Print Edition | Archives | Site Map = | Home Delivery | Advertise | Feedback | Help [IMAGE]=09 =09[IMAGE]=09 [IMAGE] [IMAGE] [IMAGE] [IMAGE] News Politics Entertainment music = movies art TV restaurants [IMAGE] Business Travel Marketplace jo= bs homes cars rentals classifieds [IMAGE] Sports Commentary Shop= ping [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] A Section= [IMAGE] [IMAGE] TOP STORIES * State's Standardized Test Spurs Scatte= red Backlash * GOP Braces for Jeffords to Bolt Today * Moderates on = Outside of GOP Big Tent MORE [IMAGE] [IMAGE] [IMAGE] STORIES BY DA= TE FOR THIS SECTION 5/24 | 5/23 | 5/22 | 5/21 | 5/20 | 5/19 | 5/18 = [IMAGE] DAILY SECTIONS Front Page A Section California [= IMAGE] Business Sports Calendar [IMAGE] So. Cal. Living EditorialsLett= ers Op/Ed WEEKLY SECTIONS Health Food [IMAGE] Tech Times [IMAG= E] Highway 1 SUNDAY SECTIONS Book Review Opinion Real Estate [IMA= GE] Calendar Magazine Travel [IMAGE] TV Times Work Place [IMAGE] [= IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Marketplace Find a home car = rental job pet merchandise boat plane or RV classifieds Pl= ace an Ad [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] L.A. Times = Subscription Services Subscribe Change of Address Vacation Stops = Suspend Delivery College Discount Gift Subscriptions Mail Subscriptio= ns FAQ [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Print Ads = from the Newspaper See this week's ads [IMAGE] [IMAGE] [IMAGE] Pri= nt Edition Orange County Valley Ventura County National Communi= ty Papers [IMAGE] [IMAGE] [IMAGE] [IMAGE] Books Columnists Cross= word Education Food Health Highway Horoscope Lottery Magazine = Obituaries Reading by Real Estate Religion Science So.Cal. Living = Special Reports Sunday Opinion Tech Times Times Poll Traffic Weath= er Workplace SITE MAP [IMAGE] [IMAGE] [IMAGE] SHOP 'TIL YOUR = LAPTOP DROPS [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Shopping [IMAGE= ] Search Products Stores [IMAGE] [IMAGE] [IMAGE] [IMAGE] = [IMAGE] [IMAGE] =09[IMAGE]=09[IMAGE] Thursday May 24 2001 | [IMAGE]Print= this story [IMAGE] [IMAGE] Shift May Empower California By RICHARD SI= MON ELIZABETH SHOGREN Times Staff Writers WASHINGTON--James M. J= effords has never mattered much to Californians. Until now. The Verm= ont senator's widely anticipated decision to abandon his fellow Republican= s and put Democrats in control of the Senate could have big implications f= or California particularly on energy and environmental policy lawmakers = and lobbyists said Wednesday. The change which Jeffords is expected= to announce today could increase political pressure on the Bush adminis= tration to respond more aggressively to California's electricity crisis t= hese insiders said. And it might force the White House to compromise= on key elements of the national energy policy it unveiled last week. In f= act the administration's proposed budget cuts for programs to promote ren= ewable energy were said to be a factor in Jeffords' decision. At th= e very least Senate observers said Sen. Dianne Feinstein (D-Calif.) is l= ikely to get the floor vote she has sought on price controls for wholesale= electricity. That doesn't necessarily mean that the administration'= s critics will be able to have everything their way. Even if the Senate ap= proves electricity price caps for example the measure would face stiff o= pposition in the GOP-dominated House--and a likely veto if it made it to t= he president's desk. Still a Democratic majority in the Senate wou= ld give Feinstein and other party members a platform to turn up the politi= cal heat on the administration and congressional Republicans on energy pol= icy. It kicks up the dust groaned one energy industry lobbyist wh= o requested anonymity. Observed Sen. John F. Kerry (D-Mass.): If P= resident Bush's hard-edged conservative approach has in fact caused the ba= lance to shift towards Democrats in the Senate it will have profound impl= ications not just for California but for the environment and our nation's= energy policy. Environmentalists seemed almost giddy as they cont= emplated the possible impact of Jeffords' decision on the policies they ca= re about. All of a sudden they said it seems less likely that oil = exploration will take place in the Arctic National Wildlife Refuge that r= ecreational snowmobiles will have free access to Yellowstone National Park= or that the administration's desire to promote nuclear power will be emb= raced by Congress. On the other hand it seems more probable that C= ongress would approve a new plan for managing a vast swath of the Sierra N= evada to protect the region's oldest trees consider legislation to restri= ct emissions of carbon dioxide from power plants and protect California fr= om a resurgence of offshore oil drilling. It's stunning how broad t= he repercussions are particularly on the environment said Gregory Wetst= one of the Natural Resources Defense Council. We're trying not to count o= ur chickens before they hatch. But it will be easier for us in our battles= at least to keep from moving backwards. For instance Jeffords is= a chief advocate of a bill that would regulate carbon dioxide from power = plants. And if events play out as expected he'll become the new chairman = of the Senate committee with jurisdiction over the issue. Another i= ssue under his purview would be the two-decade dispute over a proposed rep= ository for the nation's spent nuclear fuel at Yucca Mountain in Nevada. = Yucca Mountain is a dead turkey declared Michael Francis of the W= ilderness Society. Environmentalists had been worried that a number= of pro-development provisions would be packed into appropriation bills. B= ut with Democratic senators in charge that would become less of a threat= they said. Every wacko idea Republicans have will get a higher lev= el of scrutiny Francis said. The biggest change would be the power= of Senate Democrats to decide which bills will be considered in committee= s and which ones will make it to the floor of the Senate for votes. = As part of a new Democratic majority Feinstein and fellow California De= mocrat Barbara Boxer are likely to gain leverage with the administration o= n a number of issues considered important to the state. That transl= ates into more federal assistance for California across the board predic= ted Steve Maviglio spokesman for Gov. Gray Davis. I think it mean= s more attention to our state for sure Boxer said. Right now the pres= ident doesn't seem to give a darn. They're all looking at California as a = Democratic state. They're not interested. Feinstein who has been = unable to arrange a meeting with Bush to discuss the energy crisis may ge= t better treatment if winning Democratic support becomes more important to= the administration. She has been regarded as a bridge-builder who worked = effectively with Republicans in the past. This has not been a warm = and friendly administration she complained Wednesday. They've got peopl= e who know all the answers and don't want to listen. The White Hou= se disputed that. In fact Bush agreed Wednesday to meet with Davis during= the president's first visit to California next week. Under a Democ= ratic majority Feinstein would be in line to chair two subcommittees: the= military construction panel of the Senate Appropriations Committee and t= he technology terrorism and government information subcommittee of the Se= nate Judiciary Committee. Boxer would be in line to chair the subco= mmittee on Superfund waste control and risk assessment and the Foreign R= elations subcommittee on international operations and terrorism. Mav= iglio predicted that the effects of Jeffords' expected party defection wou= ld be felt immediately. The chairmanship of the Senate Energy and N= atural Resources Committee would be taken away from Frank H. Murkowski (R-= Alaska) who has been openly hostile to California's plight and handed = to Jeff Bingaman (D-N.M.) who supports Davis' request for electricity pri= ce controls according to Maviglio. Democrats have assailed Bush's e= nergy plan for tilting heavily toward the supply side. With Democrats in c= harge of the Senate the administration would be more likely to compromise= perhaps beefing up funding for Democrat-supported causes such as increas= ed energy assistance to low-income households and more aggressive promotio= n of conservation and renewable energy sources such as wind and solar powe= r. Search the archives of the Los Angeles Times for similar stories ab= out: United States - Politics Republican Party James M Jeffords P= olitical Party Defections California - Politics Senate (U.s.) . You = will not be charged to look for stories only to retrieve one. =09 News Politics Entertainment music movies art TV restaurants = [IMAGE] Business Travel Marketplace jobs homes cars rentals cla= ssifieds [IMAGE] Sports Commentary Shopping [IMAGE] =09[IMAGE]=09 G= et Copyright Clearance Copyright 2001 Los Angeles Times Click for permi= ssion to reprint (PRC# 1.528.2001_000043610) =09 [IMAGE] =09 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: help with neighborhood Body:: Please forward to Sue Walden and get her ideas. ----------------- What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Folder to safely pass information to Arthur Andersen Body:: We have become increasingly concerned about confidential information (dpr/position info curves validations/stress tests etc) being passed to Arthur Andersen for audit purposes over the Web to their Arthur Andersen email addresses. (necessary now they no longer have access to Enron's internal email system) Please use the folder described below when passing any info (that you would have concerns about if it was picked up by a third party) via the shared drive that has been set up for this specific purpose. Note: AA should also use the shared drive to pass info back if there are questions or the data needs updating. We should also consider the sensitivity of audit findings and special presentations if they are being distributed electronically. Please pass this note to others in your groups who have the need to pass info back and forth. Details on how to access for those who will use this method to pass info: A secured folder has been set up on the o drive under Corporate called Arthur_Andersen Please post all confidential files in this folder rather than emailing the files to their company email address. If you need access to this folder submit an eRequest through the IT Central site: Arthur Andersen will be able to retrieve these files for review with their terminal server access at the Three Allen Center location. Please contact Vanessa Schulte if you have any problems or questions Beth Apollo What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Comprehensive Solution Body:: Fax the attached word document to Jeff ASAP thanks. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: MEMO Body:: Please call me. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - New Procedures to be introduced by ENA OTC for Exec Employment Agreements and Hiring of Commercial Staff below VP into ENA Body:: David i agree in principle with this process. I assume that you and your team will implement. Like we spoke about I do not see a need to widely distribute this through the commercial organization. I would just implement. Regards Delainey ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FYI - California Conference Call, 800-749-9927, ask for Maureen Palmer Body:: Lydia McGowan (Chairman Frisbee) 410 767 8072 Christa Donahue (PFI in North Carolina -- 2024672778) Greg Piper Carol Dillon 503-464-8536 Kathleen -- Providence Gas (Mike McCall) Linda Clemmons -- MIT forum at MIT What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Body:: Natasha Thanks. I left my package and all the forms in Houston. I shall be glad to fill out the form tomorrow at the conference. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Letter for Lay Signature Body:: Rosie - please print and have signed. (Note there is a typo in the second line of the last paragraph -- does should be do). thanks What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: extra books Body:: Hi Julie Rice asked me to teach another course on energy derivatives and I plan to use the book as the main source. You can inform them that they should keep the books in stock and probably order a few more copies. I am in London right now and will stay here for a few more days. Swamped with work as usual. I was on the road for the last 2 weeks. The tropical storm unleashed the fury on my neighborhood (20 inches in one night) but we survived without major problems. The only problem I had was an overflowing swimming pool (it took 45 minutes to go from a comfortable slack to a full condition). Vince What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Conference Access Code Change!!! Body:: FYI ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: MidAmerican Draft Documents Body:: I realize you have pushed these guys already but the attached letter would be better if not sent at all. It doesn't address the real underlying problem -- that a reliability bill on a stand alone basis doesn't fix the problem. Instead the letter implies that the reason for opposition is merely a political consideration -- ie that it may reduce Congress' appetite for action next year. If possible it would be better not to have the letter go out at all. From: Cynthia Sandherr 08/22/2000 04:29 PM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/HOU/EES@EES Joe Hartsoe/Corp/Enron@ENRON dwatkiss@bracepatt.com cc: Subject: MidAmerican Draft Documents Per my first e-mail here's MidAmerican's position letter on the stand alone Reliability measure. Seems the best we can do with the utilities who have been supporting our position is to have them take a no position stance on the stand alone bill. - reliabilityonly.letter.doc What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Chili Cook Off at Rice University Body:: calendar What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CA Legislative Analysts Take on Governors ""Solution"" Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ed Segners Staff meeting, in 50M Dining Room Body:: Bryson? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Subscription Renewal Body:: I want to keep my subscription current. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Vince I agree with you that it's a lesson people need to learn over and over again. I can't tell you how many politicians I met over the past year who really don't like markets and certainly don't understand how or why they work. These aren't just the minor leaguers in Sacramento but the big league players in Washington. I also agree that the academic community can play an important role in shaping public opinion and in explaining the logic of deregulation process. I'd like to think that is in large part what I have been trying to do. Frank What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Frank I am definitely interested in the resume. I can meet the candidate on campus when I visit my son. I am planning to come to Palo Alto around Thanksgiving. Also Energy and Power Risk Management (an English publication) organizes every year in Houston a POWER RISK conference (typically in May). They ask me for recommendations regarding speakers. Would you be interested in participating? Vince Frank A. Wolak on 11/13/2000 08:44:57 AM To: vkamins@enron.com cc: Subject: Vince I am writing about a student of mine who is on the job market this year. When you stopped by my office about 18 months ago you asked if I had any students that might be appropriate for your group. Although I didn't at the time now I do. This student has excellent technical skills including an M.S. in Statistics and a Ph.D. in Economics by the end of the current academic year. His dissertation research is on the investment behavior of Independent Power Producers in the US. As a result of research assistance he has done for me he knows the California market very well and is familiar with the other ISOs. I think he would be an excellent match for you. The only problem is that he will probably have many other options available. However I definitely think he's worth a look. If you'd like him to send you a CV please let me know. Thanks. Frank Wolak Professor Frank A. Wolak email: wolak@zia.stanford.edu Department of Economics Phone: 650-723-3944 (Office) Stanford University FAX: 650-725-5702 Stanford CA 94305-6072 Phone: 650-856-0109 (Home) World-Wide Web Page: Cell Phone: 650-814-0107 What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Please get me Pat Wood's phone number and post a reminder on my calendar to call him ASAP What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential Agreement Body:: Jennifer: Here is the latest CA for Jerry to review. Please send him this e-mail asap. Thanks! Ben Rogers What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Joe & Bill Body:: Claif Briefing tomorrow US GEN market power Linda Breathitt Jordan Mintz 3-7897 Allegretti What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ross Malme, in your office. Body:: Sue Mara Lance McCarthy 37141 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Public Report 09-20 Body:: Thanks. Please keep me on the list for the more detailed management report as well. Leonardo Pacheco 09/21/2000 05:36 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Public Report 09-20 ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: You Can Put A Stake in Their Hearts but They Never Die Body:: Dr. Bowring has a PHD in economics and is a bright guy. He is the Market= =20 Monitoring Unit in PJM. While he says he generally believes that shortage= =20 is not necessarily market power he sometimes has to be reminded of that= =20 principal. Prior to PJM Joe was with the NJ Public Advocate where he did= =20 not endear himself to the regulated utilities. Since leaving the Advocate= =20 and working for PJM I think Joe has been somewhat more open to market=20 solutions and is generally cooperative in working with members to achieve= =20 market solutions to issues rather than unilaterally initiating rule changes= . =20 I find Joe easy to work with and as previously stated generally open to= =20 discussion in resolving issues and is not necessarily predisposed to a=20 solution. =20 =09Joe Hartsoe =0903/15/2001 08:36 AM =09=09=20 =09=09 To: Tom Hoatson/NA/Enron@Enron =09=09 cc:=20 =09=09 Subject: Re: You Can Put A Stake in Their Hearts but They Never Die Tom -- Is there anything you can tell them about Joe. See below. Joe What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: journalists in California sent by Ruhrgas Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Legislative Status Report Week Ending 4/20 Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ed Segners Staff meeting, in 50M Dining Room Body:: Ross Malme -- 7587 Anthony D -- 6235 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Speech to the British Institute of Energy Economists Body:: I agree with Mark's points. While we have advocated our merger with PGE (which did not concentrate market power) we have intervened in opposition to most others. Moreover there is some hope that the German government will take the opportunity to use the proposed utility merger to force greater open access. We will likely encourage that action and may oppose the merger otherwise. Most mergers in this industry are defensive not procompetitive and in my view deserve no credit for convergence innovation or liberlization. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Customs issue Body:: Got a voicemail from Rob Walls. They are (have been) looking into it. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Dan Allegrettis CT restructuring school in Houston - Body:: You are invited to join them for lunch. 1:00 - 2:00 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential Communication to my Attorney Body:: who knows. I can't imagine that a customer would somehow owe insurance to the provider's employees. Michelle What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Polaroid agreement Body:: sounds good but i couldn't open the file. could you send hard copy Kelly Kimberly@ENRON COMMUNICATIONS 10/10/2000 11:41 PM To: Michael Terraso/OTS/Enron@ENRON Lauren Goldblatt/NY/ECT@ECT Steven J Kean/NA/Enron@ENRON cc: Subject: Polaroid agreement Wow! We are making a little progress it looks like! (Steve when Mike and I met with Francis for the first time he told us we had to agree that we'd never use WWF's name related to this initiative if they participated with EES) What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: RESPONSE NEEDED Body:: No charges. I think we should refer these to Carrie Robert and ask her to run down the people in the organization most likely to have an interest. In this case I would get in touch with Andy Fastow Ben Glissan or someone in the finance group in London. That way we can make a better determination about the value of the relationship make sure those who are interested in pitching them on doing bus. with Enron can be involved. Or we can make a determination to decline. I think we decide who we want to let in then do it for free rather than charging. MARY CLARK @ ENRON 04/17/2001 08:58 AM To: Elizabeth Tilney/HOU/EES@EES cc: Cindy Olson/Corp/Enron@ENRON@EES Steven J Kean/NA/Enron@Enron@EES Karen Denne/Corp/Enron@ENRON@EES Subject: Re: RESPONSE NEEDED I'm not in favor of charging a fee that takes the goodwill out of it. I'm open to discussion on how often we host these meetings however. Elizabeth Tilney@EES 04/17/2001 08:29 AM To: Cindy Olson/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron cc: Karen Denne/Corp/Enron@ENRON Mary Clark/Corp/Enron@ENRON Subject: RESPONSE NEEDED I believe that Cindy and I can keep doing these and there is certainly a goodwill element here...and maybe that is the way to handle it. OR we might want to think about formalizing this say once a quarter and sending out invitations and maybe charging for this????I think there are pros and cons on all sides of the charging issue.....maybe we should get together and discuss? Beth ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - JS3/15/01 Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Attached is the information on talent moves within Enron. The numbers are for Enron's domestic workforce only. The bottom line is that the EBS and EES redeployment figures are not unusual for Enron: We moved over 3000 employees last year (about 25% of our domestic workforce). Most of these moves are attributable new business startups (eg EGM ENW and EIM) and normal course of business transfers within the company. The formal redeployment process makes up only a small fraction of the total moves in the company. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Observations on the Hearings this Week Body:: We're in the process of developing a strategy to take us through the next few months. But while the (otherwise perishable) thoughts are still fresh in my mind from the hearings on Monday and Tuesday I wanted to throw out some observations for discussion in the days/weeks ahead. OBSERVATION--The pressure to finger somebody for price gouging is increasing. The administration is hell bent on finding a fall guy. The price spikes pose real political risks for Davis and he and his folks need and want an easy way out. His press release following the hearing renewed the call for refunds. On my panel Loretta Lynch asked Reliant and Duke to supply her with the details of the contracts they cut to sell their power forward to marketers. And Carl Wood's remarks were extreme. At the Barton hearing a liberal democrat (Filner) and a conservative Republican (Hunter) locked arms in calling for refunds. Bilbray joined the gouging band wagon. The utilities repeatedly called on FERC to do a real investigation with hearings testimony data discovery---the works. On the positive side the FERC commissioners lauded Wolak his analysis and his remarks on the panel. Wolak said somewhat emphatically that the nature of California's market structure makes it impossible to single out a single participant as the culprit. He also stated that just everyone's just acting in their own self-interest responding to the screwed incentives embedded in the structure. IMPLICATION--It seems prudent for Enron to understand better its risks of getting fingered. In the best case the clamoring for a refund subsides. In which case the only cost to Enron is the internal cost incurred to understand better the risks of getting fingered. In the medium case investigations find that Enron (like others) played by the rules but the rules stunk and Enron profited at the expense of California consumers. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ECI Release Body:: Typo in second paragraph .. should be companies not company Karen Denne@ENRON 01/05/2000 01:52 PM To: Steven J Kean/HOU/EES@EES Mark Palmer/Corp/Enron@ENRON Mark Koenig/Corp/Enron@ENRON Paula Rieker/Corp/Enron@ENRON Peter Berger/Corp/Enron@ENRON cc: Gil Melman/Enron Communications@Enron Communications Claudia Johnson/Enron Communications@Enron Communications Subject: ECI Release The attached release announcing Enron Communications' investment in Avici and our addition of their routers to our network is scheduled to be issued on Thursday. As background ECI has invested $5 million in Avici. If you have any comments or questions please let me know by 10 a.m. Thursday. Thank you. kd What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Kissinger Body:: I'm envious. See you when you get back From: Rebecca McDonald/ENRON@enronXgate on 05/15/2001 08:21 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: RE: Kissinger We're going to be two ships passing here. I leave town on Friday and return to the office on Wednesday morning. How about I give you a call when I get back. I am only in a few days and then I am heading to DC for my son's college graduation exercises. ( I know exactly what you are thinking - Lordy she's old!!) Talk to you then okay? Rebecca What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CalPX Told To Release Confidential Trade Data To .. Body:: CalPX Told To Release Confidential Trade Data To State 09/22/2000 Dow Jones Energy Service (Copyright (c) 2000 Dow Jones&Company Inc.) LOS ANGELES -(Dow Jones)- California's Electricity Oversight Board has ordered the state's Power Exchange to hand over confidential information to the board regarding the trading activities of utilities generation companies and other market participants who traded power at the exchange since June according to a copy of a subpoena obtained by Dow Jones Newswires. The subpoena marks the first time the state will gain access and learn how each company traded power in the day-of day-ahead and block forward markets. Moreover the EOB subpoena requests the CalPX release the names of the participants who traded power at the exchange since June to better understand how and why the participants conduct business in the various markets at the exchange. The CalPX has until Wednesday to hand over aggregate supply and demand curves individual firm bid dates final schedules for each firm by generating unit injection point and take out point from June 1 through September and continue supplying trading data through Nov. 1. In addition the subpoena requests block forward trade positions by firm for June July August and September and that this information continue to be supplied through October and November. The subpoena is part of the state's ongoing investigation into California's troubled deregulated electricity market which has resulted in high wholesale power prices in San Diego landmark legislative action and accusations of collusion price gouging and market power. Gov. Gray Davis ordered an investigation in June when power prices soared to near record levels and rolling blackouts wreaked havoc in the Bay Area. The CalPX said it will comply with the EOB request and that a subpoena to access the confidential information is required according to the rules of the exchange. But the EOB will be required to protect the confidentiality of each trade it gains insight into as well as the identities of the participants who traded. If the trading activities of a company or other participant is leaked or becomes public it could have a devastating affect on the company and the EOB would be held liable according to the CalPX. The CalPX said it must notify each and every participant who traded power in its various markets to alert them of the EOB subpoena. -By Jason Leopold Dow Jones Newswires 323-658-3874 jason.leopold@dowjones.com Folder Name: Utilities Electric: Retail Wheeling Relevance Score on Scale of 100: 53 To review or revise your folder visit Dow Jones CustomClips or contact Dow Jones Customer Service by e-mail at custom.news@bis.dowjones.com or by phone at 800-369-7466. (Outside the U.S. and Canada call 609-452-1511 or contact your local sales representative.) Copyright (c) 2000 Dow Jones & Company Inc. All Rights Reserved What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: ENA-Government Affairs Meeting Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: trip to Houston Body:: I'd like to get about 30 minutes with Mark just to catch up. Mark Schroeder@ECT 07/27/2000 07:47 AM To: Elizabeth Linnell/HOU/EES@EES Richard Shapiro/HOU/EES@EES Steven J Kean/HOU/EES@EES cc: Maureen McVicker/HOU/EES@EES Beverley Ashcroft/LON/ECT@ECT Subject: trip to Houston I expect to be in Houston next Monday from 1300 until Tuesday around 1500. If any of you wish to meet please have Maureen work with Beverley toput something in the diary. Elizabeth - if you do not mind I think if we just sit down for a few hours this will be the best way to assure that Iget you timely and accurate budget info so can we book something? thanks mcs What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: GM - private and confidential - attorney/client privilege Body:: As I mentioned at the Mgmt meeting yesterday 8-9 MTM plus 5 million likely 13-14 million worst case. I have accrued this amount below the line at present and will await further meetings before taking any other actions. Because of our presence in Spain and our role with GM Vitol Veba and KPC are meeting with Chris this week as they would like us to continue to supply to them in Spain. We would also like to do this as it continues to give us the outlet we wanted when we entered the GM deal but with better partners. It also allows us to make money while we sort through the GM situation. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Board of Directors Meeting - August 14, 2001 Body:: calendar and meeting file ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Wade Cline Body:: Sandeep Thanks. Any resolution to Krishna's problem yet? Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Your June 21 Trip Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Cayote II PROJECT Body:: Please respond and copy me. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Thank you to exec recruiter Body:: prepare for my siganture. cc Lisa ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: HERE ARE MY SLIDES, I ASKED TIM TO SEND A SET OF HIS BY E MAIL TOO Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Follow Up On California Information Body:: Just following up on the Monday conference call discussion yesterday with Rick and others about nailing down the numbers and documentation so we can feed the Hill information on the mistakes Governor Davis made last year and this year on power supply contracts. As I understand it there are two aspects of this: 1. The offer of Enron and others last year to sell power to California utilities for 5 cents per kw. Failure to accept these offers resulted in higher power costs in the range of $15 billion as I recall from yesterday's call. 2. The long term contracts that California signed this year after taking actions and making statements that drove up the forward price curves are now under water to the tune of $20 billion. On both counts we will be pressed for assumptions and documentation to pursue these arguments which parallel the comments made by senior management in Capitol Hill meeting last week. We will work on back up on this end but we would greatly appreciate your assistance in this regard as well. With Congress out of session starting COB on Thursday we will need information pulled together by tomorrow COB to get the final product in the hands of congressional types and others who can use it on a timely basis. Thanks. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Dinner Plans Body:: I get in too late tonight but maybe dinner or drinks on Thurs? Linda Robertson 06/19/2001 06:39 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Dinner Plans You are here Wed and Thur nights. Do you have plans? Do you want to do something with some of the DC staff? What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: help is on the way. We are going to establish some senior executive oversight as well as an executive director (probably someone who came through the program). Charlene is going to be moving into a commercial role (which was the original plan when she was brought into the organization). I'd be happy to talk to you in more detail when I get back to Houston. Jeffrey A Shankman@ECT 02/26/2001 10:21 AM To: Jeff Skilling/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron cc: Subject: Hi guys. I wanted to let you know that I am extremely concerned about the Associate/Analyst program so much so that I feel all the work I have done and all the time I have spent on the program has had little impact outside Wharton/Penn recruiting. In fact we won't get more than 1 associate from Wharton this year for a variety of internal and external reasons. This program has brought incredible talent into the organization but we have lost a lot of momentum over the last two years. In as much as I would like to continue to support the program I can't in its current form and don't have time to fix what I thought we had been addressing. The entire program is disfunctional and the commercial teams are not lending support to the program. I'd be very happy to spend a few minutes of your time (rather than blather on in an email) to give you both my overview of the program and suggest changes and improvements. You know you have my support but the current state of affairs down there has gotten me to my rope's end with the program. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Update--0717.01 Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Welcome Lunch for new hire analysts - Monday, July 17 from 12:00 p.m. to 12:30 p.m. Body:: Do you have an alumni list of analysts/associates in key positions at Enron? Celeste Roberts@ECT 07/14/2000 03:05 PM To: Steven J Kean/HOU/EES@EES cc: Joseph W Sutton@Enron Subject: Welcome Lunch for new hire analysts - Monday July 17 from 12:00 p.m. to 12:30 p.m. Steve Thanks for stepping in and backing up for Joe Sutton on Wednesday. I wanted to provide you with talking points for your speaking engagement with our new hire analysts during their orientation. As a reminder you are scheduled to speak over lunch on Monday July 17 from 12:00 p.m. to 12:30 p.m. at the Doubletree Hotel in the LaSalle Ballroom. Purpose of the luncheon: Welcome the new hire analysts and impart to them our important this program is to Enron. The analyst program is the ultimate pipeline of top entry-level talent strategically deployed to meet anticipated business needs. We look to this program to provide the company with our future business leader. The program is a premier partner in providing exciting career challenges in areas of Finance Origination/Structuring Technology Risk Management Sales and Marketing Trading Valuation and Accounting. The analyst program is also an avenue for providing the solid foundation of knowledge and skill needed in a competitive and dynamic global corporation. We are very excited to have you on our team. This is a very exciting company that is always reinventing itself. The opportunities are endless. There will be 75 new hire analysts attending this orientation. Other than the recruiting process this is their first impression of Enron and Senior Management. The first week of their orientation will consist of presentations given by all business units/operating companies. Weeks two and three will consist of technical training (i.e. modeling valuation working styles communicating effectively and computer training). Additionally we have social events scheduled to allow them to network with peers and management. Additionally I have attached a calendar of the orientation for your review. Steve let me know if you require additional information. Thank you for your support in our new hire orientation efforts. Regards Celeste Roberts What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Davis Energy Advisors Draw SEC Attention.htm Body:: Scrutiny of Davis and crew is taking hold. The state controller Kathleen= Connell also has a well written op-ed critical of Davis in today's LA Ti= mes. =20 Kevin 213-926-2626 =20 [IMAGE]Los Angeles Times - latimes.com =09[IMAGE] [IMAGE]=09 [IMAGE] [IMAGE] =09Home | Subscribe | Register | Site Map | Ar= chives | Print Edition | Advertise | Feedback | Help [IMAGE]=09 Marketplace jobs * cars * homes * rentals [IMAGE] Arts and Enter= tainment Movies Music TV Dining print edition [IMAGE] Fro= nt Page Inside A California Business Sports So Cal Living Calendar = Editorials Op-Ed [IMAGE] [IMAGE] Weekly [IMAGE] Health Food Tech T= imes Highway 1 Workplace [IMAGE] [IMAGE] Sunday [IMAGE] Books Calen= dar Magazine Opinion Real Estate Travel TV Times [IMAGE] [IMAGE] [I= MAGE] [IMAGE] [IMAGE] The World [IMAGE] [IMAGE] [IMAGE] The Natio= n [IMAGE] [IMAGE] [IMAGE] California [IMAGE] [IMAGE] [IMAGE] Busi= ness [IMAGE] [IMAGE] [IMAGE] Politics [IMAGE] [IMAGE] [IMAGE] Spo= rts [IMAGE] [IMAGE] [IMAGE] Technology [IMAGE] [IMAGE] [IMAGE] Tr= avel [IMAGE] [IMAGE] [IMAGE] Editorials Op-Ed [IMAGE] Sections [I= MAGE] Books Columnists Education Food Health Highway 1 Obituaries = Real Estate Religion Science So. Cal. Living Sunday Opinion Tech Time= s Times Poll Workplace/Jobs [IMAGE] [IMAGE] Editions [IMAGE] Print E= dition National Wireless [IMAGE] Extras [IMAGE] Crossword Horoscop= e Lottery Traffic Weather Multimedia [IMAGE] [IMAGE] [IMAGE] Feat= ures [IMAGE] [IMAGE] [IMAGE] SITE MAP [IMAGE] [IMAGE] Subscripti= on Services Subscribe Change of Address Vacation Stops Suspend Delive= ry College Discount Gift Subscriptions Mail Subscriptions FAQ [IMAG= E] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Classifieds jobs homes cars re= ntals Print Ads Shopping Advertising Supplements [IMAGE] [IMAGE] LA= Times Initiatives [IMAGE] Times in Education Reading by 9 Times-Mirro= r Foundation Events [IMAGE] [IMAGE] =09[IMAGE]=09[IMAGE] July 31 2001= [IMAGE] Talk about it [IMAGE] E-mail story [IMAGE] Print THE STATE= Davis' Energy Advisors Draw SEC Attention *Probe: Under review is the pos= sible use of inside information to buy power company stocks. GOP rival of = governor requested the inquiry. [IMAGE] [IMAGE] Times Headline= s * Latinos Assured Water Is OK * Car Dealer Not Bound by Ad Error = Court Rules * Suspect in Simi Valley Serial Rapes Arrested * New LAPD= Radios Get Negative Reviews * 2 Shot to Death 1 at Home by Stray Bulle= t more > [IMAGE] [IMAGE] Subscribe By WALTER HAMILTON JEFFE= RY L. RABIN and DARYL KELLEY TIMES STAFF WRITERS The Securities and Exch= ange Commission has launched a preliminary inquiry into whether energy con= sultants advising Gov. Gray Davis used inside information to trade stocks = of power companies doing business with the state a source with knowledge = of the matter said Monday. The federal agency began its review late last = week the source said in response to a request from California Secretary = of State Bill Jones. A Republican rival of Davis Jones charged that stock= trading by consultants may have violated federal laws barring buying and = selling based on information not available to the public. On Friday top = aides to the governor disclosed that five consultants had been fired for = possible conflicts of interest between their official positions and their = personal finances. As news of the SEC inquiry spread through the capital M= onday Davis officials were confronted by a flurry of questions about who = in the administration owns energy stocks. Financial disclosure records fi= led by the governor's spokesman Steve Maviglio show that he owns between= $10000 and $100000 in a Texas company he and his boss have accused of m= aking obscene profits while California has been on its knees. Maviglio= said he bought the shares in Houston-based Enron Corp. in 1996. It's no= t a crime to own energy stock Maviglio said. He also owns 300 shares of= San Jose-based Calpine Corp. which has the largest share of the $43 bill= ion in long-term state power contracts. Maviglio placed the order for the= stock on May 31 one day after San Jose's mayor dropped his opposition to= a controversial Calpine plant favored by the governor and others. Under t= he terms of Maviglio's purchase the transaction was completed about three= weeks later when the stock reached $40 a share a value of $12000. It ha= s since fallen in value. I viewed it as a good long-term investment M= aviglio said adding that he purchased the shares for his retirement accou= nt based on publicly available information. The Davis administration has = spared Calpine the kind of fierce criticisms that it has leveled at other = electricity suppliers such as Enron. But California's grid operator has i= dentified the company as one of many energy merchants to overcharge the st= ate millions of dollars. The fired consultants also owned shares in Calpi= ne ranging in value from several thousand dollars to more than $100000 = records show. Another top Davis administration official legal affairs s= ecretary Barry Goode disclosed in his economic interest statement that he= recently held between $100000 and $1 million in another out-of-state com= pany accused of multimillion-dollar price gouging. In a statement Goode = said he sold his stock in Williams Co's. a month after he began working fo= r the governor in February. Goode said the shares were supposed to be sold= before he went on the state payroll but his broker failed to do so. In = light of the recent disclosures Secretary of State Jones said the governo= r must do more to ensure the public that its interest comes first. The g= overnor should direct all of his staff to immediately file updated conflic= t of interest statements that reflect current holdings and any activity si= nce their last statement of economic interest was filed said Jones who = is seeking the GOP nomination for governor. Word of the SEC's entry into = California's energy problems comes as the governor faces harsh criticism f= rom lawmakers and others for the quick and broad hiring of highly paid pri= vate consultants to guide him through the crisis. In his written request = to the SEC Jones said that recently filed disclosure documents showed tha= t at least one consultant bought and sold shares of two energy companies w= ithin the same month raising a red flag about the possibility of inside= r trading. State law prohibits officials from participating in decisions= involving their personal financial interests. The five consultants fired= last week were among 11 named in Jones' letter delivered to the San Fran= cisco office of the SEC last Wednesday. It was not clear which individuals= are the focus of the SEC's inquiry or whether the agency's review would = result in any charges. Two of the former traders said Monday that they ha= d not been contacted by federal investigators and knew nothing of an inqui= ry into possible insider trading. But William Mead fired Thursday said = it is no mystery why so many of his colleagues owned Calpine stock. Mead = said he bought it 2 1/2 years ago and made so much money he recommended it= to his colleagues last year while they all still worked for the now-defu= nct California Power Exchange in Alhambra. Calpine power was not traded on= that exchange so there was no conflict of interest he said. Mead and = three other energy traders--hired by the state in February and March--were= terminated by the Davis administration for allegedly buying power for the= state from Calpine while owning the company's stock. Fired traders Herman= Leung Peggy Cheng and Constantine Louie did not list the date of their C= alpine purchases on financial statements that the state required to be fil= ed only two weeks ago. But I'm sure they bought it while they were still= at the power exchange because that's when we discussed it Mead said. = It was kind of like a hobby. I'm sure it wasn't done with the intent to ma= nipulate. Former trader Elaine Griffin who also owned Calpine stock and= resigned two weeks ago to take another job said she didn't know she owne= d energy securities until she checked with her financial advisor July 13 = just before leaving her state job. Griffin said she and her husband own a= bout $10000 worth of Calpine stock in individual retirement accounts mana= ged by their advisor who bought the stock Feb. 1 without their knowledge= she said after research found it to be a good investment. I kind of fe= el like we've been used for political reasons Griffin said. We would ha= ve disclosed anything right at first but they never asked. As a trader= Griffin said she occasionally bought Calpine power for the state but on= ly at market prices. Meanwhile two Democratic political consultants who= helped Davis polish his image after the ongoing energy crisis caused his = poll numbers to plummet have agreed to accept no payment for their work a= s part of an out-of-court settlement of a taxpayer lawsuit. Tom Hiltachk= a lawyer for conservative anti-tax activist Lewis Uhler said the settlem= ent was reached last Friday after negotiations with lawyers for communicat= ions consultants Mark Fabiani and Chris Lehane. Now they will not receiv= e one red cent said Hiltachk. Very simply Mr. Fabiani and Mr. Lehane ha= ve agreed to cease all activities for the governor to accept no payments = for their services and to basically get out of the consulting business wit= h the governor. As his part of the agreement Hiltachk said Uhler with= drew his lawsuit Monday morning. Uhler had filed a lawsuit against the tw= o consultants and Controller Kathleen Connell in June contending that they= should not receive any payments because of a conflict of interest. The tw= o men also did consulting work for financially troubled Southern Californi= a Edison which was seeking help from Davis and the Legislature. Connell= a former Los Angeles mayoral candidate who has been at odds with Davis si= nce he endorsed an opponent had held up the payments pending the outcome = of the lawsuit. Under an agreement with Davis the men were to have been = paid $30000 a month for six months. Fabiani and Lehane could not be reac= hed for comment. * Times staff writers Nancy Vogel and Virginia Ellis i= n Sacramento and Robert J. Lopez in Los Angeles contributed to this story.= For information about reprinting this article go to http://www.lats.co= m/rights/register.htm =09[IMAGE]=09 a d v e r t i s i n g Subscribe NO= W and SAVE on your home delivery subscription! [IMAGE]Cool down rooms w= ithout touching the thermostat A floor lamp that spreads sunshine all = over a room Bring the power of the digital revolution to your fingert= ips Private DVD theater puts a floating 6-foot screen right before you= r eyes! It?s time to put all of your photos onto your computer NASA = research creates smart bed sleep surface [IMAGE] =09 =09[IMAGE] Copyright 2001 Los Angeles Times By visiting this site y= ou are agreeing to our Terms of Service . Powered by Genuity =09 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: VDEW German Delegation visiting, per Fiona Grant. She is lining up other appointments, needs one of you (SK, RS, or KM) to speak and join them for dinner. Body:: Maybe Kathleen for Gas and Steve or Rick for Electricity. Fiona Grant is primary contact Kim Chandler is backup contact. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: ticket Body:: Wincenty J Kaminski 10 Snowbird Place The Woodlands TX 77381 WT 472179 Wincenty Kaminski What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: 1. London, June 28 - 29; 2. Houston, July 16 - 17 Body:: Ehud Sorry for the delay in replying to your message. I was on the road a lot. I am in London right now and plan to attend the conference. I am leaving on Saturday morning for Houston. I have asked Shirley to get tickets for one of the evening you mentioned. I should know by Thursday if the tickets are available. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: London, New York, Houston, Financial Mathematics June/July 2001 Body:: Thanks The same to you. Vince What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Sara Woody and Elena Chilkina Body:: Anne For the time being it's fine. She will soon become an associate. Vince What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions Body:: See last story attached. Congratulations it looks like you are shaking th= ings up in typical Enron fashion. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: fact sheet- latest draft Body:: I think it's a good document and carves out some solid policy ground for Bush. I think the electricity section needs some additions though. There is not a lot that the current administration can do about siting new plants and power lines -- its largely a state and local decision. Further the problem has been less about government failing to provide adequate incentives to utilities than it has been about a failure of the current commission to opening the grid on a nondiscriminatory basis. Once utilities are in the open access transmission business they will look for ways to invest in the grid and stop getting in the way of independent power producers who want to connect to the grid. The answer is open access so power can get from where it is to where it is needed. This has been clear for a long time yet the current administration (and its appointees on FERC) have yet to use their authority to make this happen. The result: spiking prices and reliability problems. Hunt Hunter L 09/27/2000 11:25 AM To: 'skean@enron.com' cc: Subject: FW: fact sheet- latest draft - What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Call to Bob Glynn Body:: Per our discussion this morning below is a summary of items to discuss with Glynn: Adding Enron's negative CTC claim to the list of claims: PGE's filing included a list of top twenty creditors. Our negative CTC claim was apparently not taken into account in compiling that list. The list is nonbinding however. PG&E will be required to file schedules of creditors on April 20. Our negative CTC claim should be on Schedule F (for unsecured claims). You may want to remind Glynn of your previous conversations and state our expectation that the negative CTC claim will appear (preferably as uncontested) in the April 20 filing. (Note: if PG&E does not include the claim we have an opportunity to file a proof of claim and ultimately the court determines the validity of the claim). Including Enron on the Creditors' Committee: PG&E may have the opportunity to influence representation on the creditors' committees. There are several reasons to suggest to Glynn that we be included: 1) we are a big creditor 2) we could be helpful in crafting a broader solution and 3) we are one of the real parties in interest behind the PX and ISO (who were listed as significant creditors but are really just passthroughs for the suppliers ... and PG&E likely would not want to have those political bodies serving on the creditors committee anyway). What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Lay, Palmer and isakoff Body:: Palmer What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PRIVILEGED AND CONFIDENTIAL - Scott Jones Draft Body:: Attached is the draft testimony of Scott Jones. Comments should be received no later than 3:00 PM EST on Sunday August 26. All comments and suggestions need to be in writing and can be faxed (not E-mailed) to Dan Watkiss at 202-857-2131. Also if your suggestion is a proposed addition please write out the exact language you would propose we incorporate into the testimony and where you would place the addition. Donald A. Kaplan Esq. Preston Gates Ellis & Rouvelas Meeds LLP Suite 500 1735 New York Avenue N.W. Washington D.C. 20006 Ph: (202) 662-8466 Fax: (202) 331-1024 donk@prestongates.com (See attached file: TFG SJones Draft 8-25-01.doc)(See attached file: Exhibit STJ-6.xls)(See attached file: Exhibit STJ-3.xls)(See attached file: Exhibit STJ-4.xls)(See attached file: Exhibit STJ-5.xls)(See attached file: Exhibit STJ-2.doc) CONFIDENTIALITY NOTE: This email message is intended solely for the individual or individuals named above. It may contain confidential attorney-client privileged information and/or attorney work product. If the reader of this message is not the intended recipient you are requested not to read copy or distribute it or any of the information it contains. Please delete it immediately and notify the sender by return email or by telephone. Thank you. <> <> <> <> <> <> - TFG SJones Draft 8-25-01.doc - Exhibit STJ-6.xls - Exhibit STJ-3.xls - Exhibit STJ-4.xls - Exhibit STJ-5.xls - Exhibit STJ-2.doc What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request for Confidential Information by the CPUC Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Declined: Mtg w/Vince Kaminski Body:: Eydie I shall be out on Monday July 9. What about the following Tuesday? Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential re: McConville--Indemnity Body:: David As we discussed Mark Haedicke and I discussed the possibility of providing Kevin McConville with some sort of indemnity in order to make sure that he remains available and cooperative during the pendency of the NSM case and other litigation matters. We could agree to enter into a Consulting Services Agreement with Kevin. The terms of that Agreement would include: 1. He agrees to be available and cooperative with Enron and its counsel regarding litigation matters. He will agree to meet with counsel prepare for testimony review documents testify and provide other assistance as needed. 2. Through February 1 2001 Kevin would not be directly compensated for this cooperation/testimony (because he is to be receiving his salary pursuant to the terms of his employment agreement). After Feb.1 2001 he will be paid a rate of $125 per hour for his services in this regard. 3. Enron would agree to indemnify Kevin for his conduct taken in the ordinary course and scope of his employment with Enron up to the last date of his employment with Enron. Excluded from this indemnity would be allegations or claims based upon the following: -- any conduct that is outside the course and scope of Kevin's employment -- any conduct violating policies of Enron or ENA -- Kevin's intentional acts -- Kevin's gross negligence -- Kevin's reckless conduct -- conduct that is in violation of any law statute regulation or other legal obligation or -- the commission of an unlawful or illegal act. 4. Kevin would invoice Enron for time spent in performing the services after 2/1/01. The invoice would be paid within 30 days of receipt. In addition all related expenses would be reimbursed throughout the term of the agreement. Let me know if you have any questions or require additional information. I am available to participate in your call with him if you would like me to attend. Michelle What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: new contract Body:: My copy shows long term comp on the exhibit under Grant Award. And yes the date will be revised. Mark Schroeder@ECT 04/14/2000 03:31 AM To: Steven J Kean/HOU/EES@EES Mark Frevert/LON/ECT@ECT cc: Subject: new contract The contract Mark gave me to review yesterday only covers monthly salary. I had expected there to be some discussion/reference to long-term comp plan. Mark had mentioned that what he gave me did not deal with certain non-compete payments owed to me in 2000 so I am not looking for that but I did think he had said that there was something in the doucment re:long-term which I cannot find. Please advise if I am missing something. I will withhold other comments for now except to note that the draft was dated 13 March and had a 14 day period before expiry (now passed) and will assume that that is an irrelevancy. Look forward to hearing from one of you. mcs What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Flatscreens approval Body:: I approve. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Ken Lay/ Jeff Skilling visits Body:: I spoke with Jeff and he is not going to be available for the speech on the 26th. Do we pass or is there an alternative? Can we get done what we need to get done with Ken's visit the following week? Nicholas O'Day 08/31/2000 06:01 AM To: Steven J Kean/NA/Enron@Enron Rosalee Fleming/Corp/Enron@ENRON cc: John Mark Schroeder/LON/ECT@ECT Joseph P Hirl/AP/ENRON@ENRON Mika Watanabe/AP/Enron Takashi Kimura/AP/Enron@Enron Subject: Ken Lay/ Jeff Skilling visits Ken Lay Visit. Following discussions with the Prime Minister's office and a quick check with venues 31 October is firming up as the preferred date for a meeting with the Prime Minister and an office opening by the PM. Jeff Skilling Visit. The Nikkei and the Tokyo University have now made the decision to invite Mr Skilling to give the key note address at the symposium on 26 November in Tokyo. As mentioned the symposium is the most prestigious conference on IT in Japan. While the conference itself receives significant media attention the President of Nikkei has offered to interview Mr Skilling. This honour is usually reserved for Heads of State. The interview will be featured on the front page of the Nikkei and picked up by other major media services. kind regards Nicholas O'Day 08/29/2000 07:43 PM To: Steven J Kean/HOU/EES@EES Rosalee Fleming/Corp/Enron@ENRON cc: John Mark Schroeder/LON/ECT@ECT Joseph P Hirl/AP/ENRON@ENRON Mika Watanabe/AP/Enron Takashi Kimura/AP/Enron Subject: Re: Ken Lay meeting with Japanese Prime Minister Ken Lay Visit. Balancing the need to push out the arrangement of high level meetings as far as possible with the desire to have a meeting with Prime Minister Mori prior to the US Presidential election the week commencing 30 October would be the optimum time for a visit by Mr Lay. PM Mori is generally available in that week. We will get a preferred time from the PM's chief secretary first thing tomorrow morning Tokyo time. Jeff Skilling Visit. The boards of Nikkei and Tokyo University Institute of Advanced Studies have yet to make a decision on the key note speaker for the one day invitation only seminar to be held on 26 October. As mentioned the boards will choose between the chairman of Cisco and Jeff Skilling. The conference is focused on the IT revolution and an invitation only event for approximately 600 of Japan's corporate leaders. The speaking panel and topics for discussion will be developed around the key note speaker. If Mr Skilling were to give the key note speech it is likely that key senior Government Ministers would be asked to present at the seminar. Following the Prime Minister's commitment at the Okinawa summit of US$15billion expenditure in the region on IT infrastructure and education Japan's focus on e-commerce is almost reaching fever pitch. There will be significant interest in the conference from senior levels of Government and the business community. Further as you would expect with the involvement of the Nikkei there is typically significant media coverage associated with the key note speaker's presentation. kind regards What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Please send Pam Benson the information for Joe on where to send the check who to make it out to etc ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Oklahoma legislators will be in Houston this afternoon. Body:: You speak at 3:00 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: attached is a copy of my california testimony. The proceeding was somewhat productive but turned into a witch hunt at a couple of points. Our view on this is: the problem is fairly straightforward (demand increases and new supplies are inhibited so prices go up and shortages ensue ... sound familiar?) and the solutions are straightforward (site the power plants suppliers are begging to build let the utilities hedge outside the exchange and finish the job of opening the interstate grid so power can get from where it is to where it is needed). What it comes down to at this point is FERC is the only entity with the authority to start fixing this problem now: Congress isn't going to get anything done this year and the California legislature is (thankfully) out of session now. Our political leaders need to give FERC the room they need to act. Good luck on your speech and give me a call sometime. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Council of Shopping Centers, per Cynthia Sandherr. In Chicago. John Scoblick doing this. Body:: Stan Broussard 3-5468 Cynthia Sandherr Subcommittee going to mark up on Oct 13 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: PRC reviewers Body:: Steve No problem. I shall spend Friday working on reviews. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE; Luntz Focus Groups Body:: ----------------- What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Andrew Lundquist Body:: Your assessment makes perfect sense to me. What do you think about having Nels make the call to Lundquist just to find out what his status is what he might look for when his current assignment is over etc. (obviously without identifying us -- presumably Nels would have reason to talk to him anyway in the normal course of business)? I am not wedded to the idea but am inclined toward at least getting the information unless you see a problem. Linda Robertson 03/13/2001 02:16 PM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron cc: Subject: Andrew Lundquist I got your message about Andrew. He would be an excellent catch. However I see a couple of significant problems. My guess is that Andrew is too senior for this position particularly after having chaired the Cheney task force. Also I would not anticipate that he would be available for several months if then. We should fill this position immediately. We are already missing opportunities because this position is vacant. As for our search using Korn Ferry I have narrowed the field to two very good candidates. I am setting up time for Rick to interview these candidates next Monday. The first candidate is Drew Maloney with Rep. Tom Delay's office. Drew would give us enormous visibility in House Republican leadership circles seems trustworthy and capable of learning most of the substance of the energy portfolio. Drew has strong networking skills which I think would nicely fit with Tom's strategic and technical skills. The second candidate is John Shelk whom I have known for nearly 15 years. John was the lead Republican staff on the House Energy and Commerce Committee under Norm Lent. John left the Committee in 1992. Since then John has worked in the financial services and gaming industries where he has enhanced his political and Republican networking skills. John in very short order would have extremely strong technical skills atlhough he has been away from the industry for eight years. I believe both candidates bring different but very strong talents to the job. I have a second opening for an enviromental advocate. I am discussing with Rick the possibility of whether we could redirect one of these candidates (probably John) to that slot. That said please let me know if I should have Nels pursue Andrew. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential & Proprietaty - Udated PanNat Value Body:: Mark: Per my voice mail. Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Weekly Regulatory and Government Affairs Report Body:: print first attachment only What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Philippe Body:: Yes Phillippe left to join a firm in New York -- I don't know who. Christopher Culberson on 06/26/2001 02:42:53 PM To: skean@enron.com cc: Subject: Philippe Steven I hear Philippe is leaving for Putnam any truth to this? I've been unable to contact him directly. Thanks in advance. Best Regards Chris M. Culberson cmculbe@us.ibm.com (281) 556-8104 What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Western Governors update Body:: Thanks for the update. The Western Governors remain the best avenue we have for preventing price caps and California's attempts to secede from the grid. We need to keep pushing information to them regarding these issues. Attached is some text I have been using for correspondence with policy makers regarding California issues. Feel free to use it. Susan M Landwehr 03/02/2001 05:09 PM To: Steven J Kean/NA/Enron@Enron John cc: Subject: Re: Western Governors update Gentlemen--FYI--here's an update on what we've been doing lately with the Governors. I'll include you guys on future e mails. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: news/updates Body:: I am attaching the FERC order and staff recommendations. The order provides for $69 million in potential refunds (either pay up or provide cost justification). Enron was not named as one of the 13 overcharging parties but PGE was ($3.18 million). It's not over yet though. The order deals only with Jan 01 and promises further orders regarding Dec 00 and benchmark prices through April 01. The prices used to determine refunds were fairly high ($273/mwh based on gas prices emissions costs and an assumed heat rate of over 16000). With respect to sales to California we have concluded at least one short term sale and have talked with Cal Dept of Water Resources about longer term deals but we were still struggling with credit issues last I heard. I'm copying Jeff Dasovich because I'm sure he has more up to date information. Mark Schroeder@ECT 03/11/2001 02:11 PM To: Richard Shapiro/NA/Enron@Enron Steven J Kean/NA/Enron@Enron cc: Subject: news/updates In the press I saw two news stories that I wondered if we (Enron) had any role/hand in and what was the offical spin in both cases. 1) The FERC Order requiring something like 55-65 million dollars in refunds by generators (or did it include traders) for overcharging in California in December if I recall my facts/news stories correctly and 2) the reports of 40 companies entering into 10-year contracts with California (touted by Davis). Was Enron a contracting party? Do we think this is a good solution (I think I know the answer but defer to your lead on this so we stay on your message)? thanks mcs What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Security Assessment Report Body:: I appreciate you pressing this issue. You should both be aware that Unocal(?) has been sued by the families of four employees who were shot in Pakistan a couple of years ago. Their claim is that the company did not provide adequate security and ignored official warnings of trouble in the region. To: Gabriel cc: David Frank Shawn Elaine Bill Donovan/EPSC/HOU/ECT@ECT Melinda Winkler@ECT Steven J Kean/HOU/EES@EES Subject: Re: Security Assessment Report Gabriel et al: Looks like the risks to Enron travelers to (and employees in) Colombia have increased. This is another indication that a 'travel policy' for travelers to Colombia should be in effect. What happened to the one we were discussing earlier? The steps outlined there would go a long way in improving the security of our travelers. Control Risks' report discusses responses to the media - be sure you have the approval of Enron's media people before making any response. The report also recommends suspending bidding on new projects - probably not viable advice but reinforces the importance that additional security measures be built into all new projects from day one. Now that our name is in front of the Colombian public we could see retaliation for various acts not all of which we have control over. Recent US Government actions such as extraditing criminals to the US for trial and training Colombian anti-drug troops have done little to endear American businesses to the Colombian public who see such actions as interfering with Colombia's right to govern themselves. These actions have significantly raised the risk of all American companies and their employees in Colombia. A meeting I had about two years ago with David Beddow of Control Risks in Bogota indicated that we could see some changes in the methods of attack in urban areas by FARC/ELN. With an elevated risk level we should begin thinking about these threats. FARC seldom uses the car bomb method of attack because it generates little interest among the domestic or international media. FARC plans on using letter bombs mailed to select targets i.e. head of an American-owned corporation who may have an office in Bogota. This method will generate headlines in the press and generate a fear of FARC among businessmen who may be targets. Control Risks' reported timetable for this change in FARC's tactics was to be three to five years but now that our risk is higher the timetable may well be moved up. On a related note - did you employ the security person we recommended? Please let me know how I can help you. Regards Mike Hicks Gabriel 12/05/99 08:15 PM To: David Frank Shawn cc: Michael Hicks@ECT Elaine Subject: Security Assessment Report FYI please find attached the Security Assessment Report carried out by Control Risk . Please let me have your feed back .GSS ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Upcoming Advisory Council Meeting Body:: I'm looking forward to your discussion regarding the reregulation threat at the next meeting. Below are some of my observations: While it's premature to say we have an energy crisis we are witnessing the triple threat of high summer gasoline prices spiking electricity prices and high natural gas prices for the upcoming heating season (I'll send along some of the data). There is at least the potential for this to become a prominent national political issue: Gore has focussed relentlessly on Bush's ties to big oil (which includes us by the way though we produce nary a drop) and Congressional republicans have blamed the current administration for failing to have a coherent energy policy (though at least so far the dominant characteristic of the administration's policy has been a republicanesque reliance on the market). Notwithstanding the issue's potential to become political fodder and its prominence in the popular press many Americans seem blissfully ignorant at least on the electricity issue. We did some focus group testing recently in Southern California -- a mere 15 minutes from the epicenter of the San Diego price quakes -- and most people knew nothing about it. So while the issue has the potential for political traction it may not have caught on yet (except in places like San Diego and New York city. The reaction in California has been to call for government intervention in electricity markets. Investigations of out of state price gougers and profiteers have been undertaken and wholesale and retail price caps have been put in place. They have not worked -- at least in wholesale markets. Suppliers are deciding to site plants elsewhere and when prices are high elsewhere in the West power flows out of California to those other markets. Ironically though I can't explain it in classical economic terms the setting of rate caps in wholesale markets has had the effect of pulling prices up to the capped levels in offpeak times when there is more than enough supply. For the most part though the caps and the other political reactions have been somewhat muted: policy makers have been reluctant to throw the deregulation plan out and start over and the retail price caps have been relatively narrow ... so far. Outside of California the authors of other states' deregulation plans have distinguished their proposals from California's. Regulators and legislators from such diverse places as Connecticut Texas and Alberta have gone out of their way to defend their plans and explain why California won't happen here. For the most part then the reaction to California has been positive from Enron's perspective in states that have already deregulated. There does remain some threat that aspects of the state plans (e.g. utility plant divestiture) may be postponed or cancelled. The story is a bit more grim in states that were considering deregulation but have not gone forward with their plans: I think it's off the agenda in most places. The fact that most of the major markets (about 70% of total electric revenue) are already deregulated/deregulating is a blessing in that regard. At the federal level there has been a combination of the burn the village in order to save it approach -- allow some price caps to remove the pressure to reverse the whole deregulation program -- and a more positive call for comprehensive reform. All in all I believe we're OK so far and we need to look at this as an opportunity: business is booming we sell protection from price volatility and the need for such protection is now plastered over the front pages of major newspapers. On the public policy front we need to convert the controversy into productive action. Our target has been FERC -- they are somewhat removed from the white hot rhetoric in California and they are a single commissioner's vote away from taking action to further open the market. Enron's response: Initially we hoped to feed information into industry groups and let them carry the message our concern was that Enron -- a company which was in and out of the residential market in Cal. -- would not make the most attractive champion for the open market message. We hoped that the new generators in Cal would take up the mantle. It's fair to say that they fumbled the ball: they are now locked in a pitched battle with the utilities over price caps and fall all to easily into the out of state profiteer label .... standing between Aunt Millie and rate relief. They were also extremely slow out of the blocks with a more productive message. We are now working the issue directly. We are working the issue on a number of levels: 1) PR - we have good contacts in the press and have talked to numerous reporters and editorial writers. As time goes on the information and reporting has gotten somewhat better. 2) Govt relations - we have been pushing for power plant siting legislation in California (the market wants to build capacity but the government won't let it). This may be the best environment we'll ever see for streamlining the permitting process. Also in typical Enron fashion we put a deal on the table. We offered to sell power to the local utility at a price which would enable them to lock in stable rates for their customers at below current rates. Our offer was followed by nine others and we tried to make something of the fact that the market was offering better solutions than California politicians. SDG&E dropped the ball unfortunately. Instead of seizing the opportunity they ended up going along with a government granted rate discount which will cause them to accrue a massive deferral account. At the federal level we are contacting members the DOE and FERC. Here we are making a push for FERC action to finish leveling the playing field in wholesale markets so power can get from where it is to where its needed. Additionally we are developing a prepackaged system (including software) for nondiscriminatory open access (to take away any lingering excuses or delays). 3) Overall messaging -- we have been working with a well known political pollster to check our messages for their resonance at the grassroots level. As we hone these messages we will be using them in the fora we are currently working. Overall we have more opportunity than risk in the current environment but capitalizing on those opportunities continues to be a long shot. An intersting rhetorical challenge for us is this: much of the problem in power markets is blamed on high upstream fuel prices particularly natural gas. The gas market is open and structured pretty much the way we are advocating for electricity so how can we maintain that the problem in power markets is an absence of open markets when the most open commodity market on the planet (natural gas) is producing such outsized prices? The answer is somewhat complicated and therefore a bit unsatisfactory in the current debate: gas prices are still lower in real terms than they were pre-deregulation long term prices are also lower than historical levels ( the curve is backwardated (sp?) meaning that prices in later years are lower than today so you can buy gas for 3 years at a price lower than current spot prices) and the economy is booming and driving up demand for basic inputs (this begs the question: why didn't the market react sooner and avoid the spike?). When all else fails a big part of the problem can be blamed on OPEC. We haven't had this thrown at us yet but we are trying to anticipate it and have answers at the ready. This is just the tip of the iceberg. The issue is a great example of the intersection of our business interests with public policy debates and should promote a lively discussion when we get together. Let me know if there is anything else you need. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: External Affairs Meeting in 50M03, conference bridge 853-3233 passcode 3000, you are the host Body:: Merger call 8004570183 506711 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Tony Pryor (GPG legal) asked if we have any credentials/tickets left for die hard democrats in the company. I know Tony will understand if they are already spoken for but if we have some left that would go unused we have a volunteer. How's it going? Are you partied out yet? What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: IEP News 4/30 Body:: Today's news and some from the weekend in the following order: A year later energy crisis shows no signs of cooling off By Ed Mendel San Diego Union Tribune April 30 2001 (Quotes ??? ???Smutny on behalf of IEP) The Daily News of Los Angeles April 27 2001 Friday Valley Edition NEWS ????Pg. N9 275 words PROPOSED LAW PUTS BOUNTY ON ENERGY MANIPULATORS Staff ????And Wire Services (Quotes Smutny on behalf of IEP) San Jose Mercury News April 27 2001 Friday SJ-ELECTRIC-SUIT 245 words ????Santa Clara County Calif. Joins Lawsuit against Electric Suppliers By ????John Woolfolk (Quotes Smutny on behalf of IEP) FERC Considers Imposing a Fee on Electricity Sales in California ????? ???Updated: Monday April 30 2001 12:40 AM?ET ????-- Dow Jones News Wire? ? Los Angeles Times April 30 2001 Monday Home Edition Page 3 792 words ???? CAPITOL JOURNAL ?CALIFORNIA AND THE WEST ??How Sales Tax Is Falling ????Through a Loophole GEORGE SKELTON SACRAMENTO Los Angeles Times April 30 2001 Monday Home Edition Page 3 1808 ????words CALIFORNIA AND THE WEST ??THE CALIFORNIA ENERGY CRISIS ??LIST OF ????PG&E CREDITORS SHOWS FIRM'S WIDE REACH IN BUSINESS ??BANKRUPTCY: IT ????INCLUDES SMALL AND BIG COMPANIES GOVERNMENT AGENCIES AND FORMER EMPLOYEES. ????TIM REITERMAN TIMES STAFF WRITER SAN FRANCISCO Los Angeles Times April 30 2001 Monday Home Edition Page 3 1228 ????words CALIFORNIA AND THE WEST ??THE CALIFORNIA ENERGY CRISIS ??POWER WOES ????COMPLICATE DISCUSSIONS ON BUDGET ??FUNDING: GOV. DAVIS' PLAN FOR NEXT YEAR ????FACES DEMANDS FOR BILLIONS AS A RESERVE AND TO CUSHION ELECTRICITY RATE ????HIKES. DAN MORAIN TIMES STAFF WRITER SACRAMENTO Los Angeles Times April 30 2001 Monday Home Edition Page 7 839 words ???? COMMENTARY ??WILL THE FERC SEE THE LIGHT ON THE LAW? FRANK A. WOLAK ????Frank A. Wolak an economics professor at Stanford University is chairman ????of the Market Surveillance Committee of the California Independent System ????Operator The New York Times April 30 2001 Monday Late Edition - Final Section ????A Page 1 Column 5 Business/Financial Desk 1444 words While a Utility ????May Be Failing Its Owner Is Not By By RICHARD A. OPPEL Jr. and LAURA M. ????HOLSON The San Francisco Chronicle APRIL 30 2001 MONDAY FINAL EDITION NEWS ????Pg. A3 1108 words NEWSMAKER PROFILE ???Nettie Hoge ???Taking on power ????Consumer advocate revels in uphill battle Chuck Squatriglia The Washington Post April 30 2001 Monday Final Edition A SECTION Pg. ????A03 1669 words Energy Forecast for Summer: No Blackouts but Price Spikes ????Grid Managers Promote Conservation Await New Plants William Claiborne ????Washington Post Staff Writer CHICAGO The Associated Press State & Local Wire April 30 2001 Monday BC cycle ????9:49 AM Eastern Time State and Regional 594 words Developments in ????California's energy crisis By The Associated Press AP Online April 29 2001 Sunday Domestic non-Washington general news ????item 1313 words Geothermal Plants Need More Steam JENNIFER COLEMAN ????MIDDLETOWN Calif. The Associated Press State & Local Wire April 29 2001 Sunday BC cycle ????State and Regional 413 words Guns in schools deregulation delay on ????lawmakers' agenda By BRAD CAIN Associated Press Writer SALEM Ore. Idaho Falls Post Register April 29 2001 Sunday News Pg. a1 530 words ????Plenty of blame to go around for West's power woes PAUL MENSER Los Angeles Times April 29 2001 Sunday Home Edition Page 6 1312 ????words THE STATE ??HOW KILOWATT SOCIALISM SAVED L.A. FROM THE ENERGY CRISIS ???? JEFF STANSBURY Jeff Stansbury is a PhD candidate in American history at ????UCLA. His dissertation is on the role of the labor movement in the building ????of L.A.'s infrastructure Los Angeles Times April 29 2001 Sunday Home Edition Page 4 558 words ???? CONSERVATION SANDBAGS ??THE DAVIS ADMINISTRATION NEEDS TO LAUNCH A CRASH ????EDUCATION COURSE TO CONVINCE CALIFORNIANS OF THE SERIOUSNESS OF THE ????ELECTRICITY CRISIS AND THE NEED FOR FAR-REACHING ENERGY-SAVING MEASURES. Los Angeles Times April 29 2001 Sunday Home Edition Page 27 1316 ????words BUSH: THE FIRST 100 DAYS ??BUSH IS OFF TO A ROCKY START IN HIS ????HANDLING OF ALL THINGS CALIFORNIAN ??POLITICS: BUT WHY WOO THE GOLDEN STATE ????WHEN HE CAN'T CARRY IT IN AN ELECTION 'NO MATTER HOW HARD HE TRIES' ONE ????ANALYST POINTS OUT. RICHARD SIMON TIMES STAFF WRITER WASHINGTON Los Angeles Times April 29 2001 Sunday Home Edition Page 2 1290 ????words WEEK IN REVIEW ??TOP 10 STORIES / APRIL 23-27 Lisa Girion and ????Terril Yue Jones and Sallie Hofmeister and James Bates and Peter Pae and ????Jeff Leeds and Nancy Rivera Brooks and Peter Gosselin The New York Times April 29 2001 Sunday Late Edition - Final Section ????4 Page 17 Column 1 Editorial Desk 756 words Reckonings The Real Wolf ????By PAUL KRUGMAN Sacramento Bee April 29 2001 Sunday Pg. A1 1323 words Diesel plants ????spark concern They're expected to generate big air-quality problems when ????predicted summer blackouts hit. Chris Bowman and Stuart Leavenworth Bee ????Staff Writers Sacramento Bee April 29 2001 Sunday Pg. A1 1544 words Why Edison ????PG&E split on strategy Dale Kasler Bee Staff Writer Sacramento Bee April 29 2001 Sunday Pg. A3 679 words What will be ????fallout from California's energy meltdown? Dan Walters The San Francisco Chronicle APRIL 29 2001 SUNDAY FINAL EDITION ????INSIGHT Pg. D1 1419 words The energy crisis is good for you Louis ????Freedberg Ventura County Star April 29 2001 Sunday Editorials Pg. B09 704 words ????Reality is what's needed for real policy ?GOVERNOR: Consumers deserve to get ????real facts from Davis. Dan Walters Los Angeles Times April 28 2001 Saturday Home Edition Page 19 679 ????words OFFICIALS CALL PRICE STABILITY PLAN ILLEGAL ??UTILITIES: AGENCY ????CHIEFS SAY THE FEDERAL PROPOSAL COULD ALSO CAUSE MORE BLACKOUTS THIS SUMMER. ???? NANCY VOGEL and MIGUEL BUSTILLO TIMES STAFF WRITERS SACRAMENTO Los Angeles Times April 28 2001 Saturday Home Edition Page 19 688 ????words BILL COULD FOIL DAVIS' ELECTRICITY OFFENSIVE ??POWER: CONGRESSMAN ????WANTS TO LET SMALL PRODUCERS SELL ON WHOLESALE MARKET. BACKERS SAY PLAN ????WOULD BOOST SUPPLY BUT FOES SEE IT COSTING CALIFORNIA DEARLY. JULIE TAMAKI ????and MIGUEL BUSTILLO TIMES STAFF WRITERS SACRAMENTO Los Angeles Times April 28 2001 Saturday Home Edition Page 2 137 ????words BRIEFLY / ENERGY ??PUC ORDERS UTILITIES TO POST BLACKOUT DATA Nancy ????Rivera Brooks Sacramento Bee April 28 2001 Saturday Pg. A3 1109 words Cities take ????new look at public power The state's uncertain electricity picture has local ????officials deciding it's time to revisit the idea of municipal utilities. ????Carrie Peyton Bee Staff Writer A year later energy crisis shows no signs of cooling off By Ed Mendel San Diego Union Tribune April 30 2001 SACRAMENTO -- The first anniversary of the California energy crisis is coming up next month and as the Queen of England once remarked when the royal family seemed to deregulate it's been an annus horribilis. The horrible year for California began last May when electricity prices suddenly began to soar triggering a debate about the cause of the mysterious price increase that is likely to continue for years. It started when a three-day heat wave from May 21 to May 24 set records in some areas of the state and drove up the demand for electricity as Californians sought relief with air conditioning. More record heat June 14 in the San Francisco Bay Area strained the overloaded system of Pacific Gas & Electric and resulted in rolling blackouts the planned temporary power outages that some fear may be routine this summer. The average price of electricity on the now-defunct Power Exchange soared to $120 per megawatt hour in June five times higher than the same month the previous year and remained roughly at that level until skyrocketing to $377 in December. San Diego sounded the statewide alarm last summer as San Diego Gas & Electric the first utility to be deregulated passed along much of the higher cost of electricity to its customers until legislation rolled back and capped the utility's rates in September. The executive director of a San Diego consumers group the Utility Consumers' Action Network thinks the generators and the marketers of power using sophisticated computer methods learned something as the heat wave drove up the demand for power. It was the first time the generators had an opportunity to see how high the price could go said UCAN'S Michael Shames. It was their primer. It was Gouge 101. State Sen. Steve Peace D-El Cajon who chaired a two-house committee that completed the deregulation plan in 1996 had seen routine monitoring data suggesting that the power market was being manipulated to drive up prices. Peace took the unusual step last June of personally urging the adoption of a much lower price cap by the board of the agency that makes last-minute power purchases to maintain the grid the Independent System Operator. But the motion failed by a single vote. The consumer representative who cast the decisive vote against the lower cap resigned afterward with a blast at Peace complaining of heavy-handed pressure. Peace is unapologetic. He believes that stronger action by the ISO last June would have sent a signal that might have discouraged market manipulation. It's just like the Federal Reserve mis-timing an interest-rate move Peace said. The former ISO chairman who represents generators cited an ISO report attributing the price increase last May to the heat wave power plant outages less hydroelectric power and higher prices for the natural gas used by power plants. I think all of those things showing up at the same time resulted in significantly higher prices said Jan Smutny-Jones of the Independent Energy Producers. Why power prices remained at high levels and even soared last winter instead of dropping as usual is more difficult to explain. The ISO contended last month that generators overcharged by more than $6 billion from last May through February. But federal regulators who have their critics have found only $125 million in overcharges making it an annus marvelous for generators. Ed Mendel is Capitol bureau chief for the Union-Tribune. Copyright 2001 Union-Tribune Publishing Co. The Daily News of Los Angeles April 27 2001 Friday Valley Edition SECTION: NEWS Pg. N9 LENGTH: 275 words HEADLINE: PROPOSED LAW PUTS BOUNTY ON ENERGY MANIPULATORS BYLINE: Staff And Wire Services BODY: ??California stepped up its war on the power industry Thursday as state legislators offered to pay millions of dollars to bounty hunters who provide information leading to the arrest and conviction of energy executives and others who manipulate the electricity market. ???California is being plundered by an energy cartel said Lt. Gov. Cruz Bustamente who is promoting a bill that would level criminal penalties for exploiting energy markets. ?If what they are doing isn't illegal it ought to be. ???Bustamente was one of a crowd of state leaders who went before microphones. ???On the floor of the Assembly Speaker Bob Hertzberg D-Van Nuys rallied his Democratic colleagues behind a bill to create a state power authority with equally blistering attacks on private power suppliers. ???But after Thursday's hearing before a Senate committee formed to investigate alleged price-fixing in the energy market committee chairman Joe Dunn D-Garden Grove told a reporter: I've never seen this much smoke when there wasn't a fire. ???Power generators insist they are operating fairly and say there is no evidence of them acting outside the law. ???Jan Smutny-Jones executive director of the Independent Energy Producers Association dismissed the harsh rhetoric as unproductive. Putting people in prison isn't going to encourage more generation Smutny-Jones said warning that the political posturing would make energy generators think twice about investing in California. ???Also on Thursday experts said federally ordered caps on wholesale electricity prices won't necessarily mean California will escape rolling blackouts this summer. Copyright 2001 San Jose Mercury News San Jose Mercury News April 27 2001 Friday KR-ACC-NO: SJ-ELECTRIC-SUIT LENGTH: 245 words HEADLINE: Santa Clara County Calif. Joins Lawsuit against Electric Suppliers BYLINE: By John Woolfolk BODY: ??Santa Clara County agreed Thursday to join a lawsuit against power suppliers alleging they conspired to raise prices and boost profits while subjecting consumers to higher bills and rolling blackouts. ??The county is the first to join the suit originally filed by San Francisco in January. ?The suit seeks refunds for consumers of more than $ 1 billion in alleged excess electricity profits. ??The San Francisco suit contains significant allegations of manipulation and collusion by the wholesalers resulting in the disastrous consequences we're all familiar with said lead deputy county counsel Alan Tieger. We looked at the evidence on which those allegations were grounded and found they were indeed supported by the evidence expert and otherwise. ??The suit names a dozen electricity generating and marketing companies including Duke Energy and Enron Energy Marketing. ??Similar claims have been filed by three water districts in the San Diego area and two class-action lawsuits by private attorneys on behalf of consumers are pending against power suppliers. ??The companies have vigorously denied the charges. ??I don't think there will be any evidence of illegal activity by anyone said Jan Smutny-Jones executive director of the Independent Energy Producers Association when asked about various government probes. ??----- ??To see more of the San Jose Mercury News or to subscribe to the newspaper go to http://www.sjmercury.com FERC Considers Imposing a Fee on Electricity Sales in California ???? Updated: Monday April 30 2001 12:40 AM?ET ????? ? Such a surcharge at least in the short run would fall hardest on the state of California which since January has spent more than $5 billion buying power because the utilities have been unable to meet their obligations. For now the idea is nothing more than a proposal that occupies one paragraph buried in a 39-page order issued Thursday concerning changes to California's flawed deregulated electricity market. The commission is seeking public comment on the surcharge proposal for 30 days. After that it will decide whether to implement it. The fee was proposed by Commission Chairman Curt Hebert a Mississippi Republican as a way to stabilize the market he said Friday since part of the problem in California has to do with nonpayment of bills by the utilities. But the provision also has the potential to funnel billions of dollars to energy suppliers at a time when those payments are the subject of intense negotiation. One of the utilities PG&E Corp.'s Pacific Gas & Electric Co. (PCG news msgs) filed for protection from creditors under U.S. bankruptcy law on April 6 hoping to settle its claims with power suppliers for something less than face value. Representatives of Pacific Gas & Electric and Edison International's (EIX news msgs) Southern California Edison declined to comment on the FERC proposal Friday. The surcharge idea faces stiff opposition from some state officials one of whom said it amounts to an unwarranted intrusion into state jurisdiction. Loretta Lynch president of the California Public Utilities Commission said imposition of a surcharge would put pressure on wholesale-power costs that already are too high. Bulk power cost $7 billion in California in 1999 and topped $27 billion last year as prices careened out of control. Ms. Lynch said she opposes the surcharge provision and the entire order given Thursday but that it will be up to the full commission to decide how -- or whether -- to file a challenge at FERC. A spokesman for Gov. Gray Davis said the governor would be strongly opposed to any attempt to siphon money away from the state and expects to lodge an objection. Los Angeles Times ?????????????????????April 30 2001 Monday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 792 words HEADLINE: CAPITOL JOURNAL CALIFORNIA AND THE WEST How Sales Tax Is Falling Through a Loophole BYLINE: GEORGE SKELTON DATELINE: SACRAMENTO BODY: ??Dot-coms are in distress and laying off. Silicon Valley is a home buyer's bazaar. The Nasdaq is nauseous. So is this any time to be siccing the tax collector on Internet retailers? ??You bet. Coddling these techie traders with tax favors doesn't seem to be helping them much anyway. So why not treat e-tailers like everyone else like brick-and-mortar merchants? Treat everybody evenhandedly. ??That's the view of Assemblywoman Carole Migden (D-San Francisco) assertive chair of the Assembly Appropriations Committee. For the second straight year Migden is pushing a bill she says will close a loophole that benefits some Internet retailers. She insists it's about fairly enforcing existing law not about a new Web tax as critics claim. ??Present law requires Internet e-tailers to collect the sales tax if they have a physical presence in California such as a traditional brick-and-mortar store. But some big outfits have created separate out-of-state subsidiaries to handle their Internet orders. Same goods same ads--with a large tax loophole because the subsidiary ostensibly does not have a physical presence in California. ??Never mind that an unsatisfied customer of bookseller Barnes & Noble dot-com for example can return the Internet purchase to the local Barnes & Noble store. ??Many e-tailers with dual bricks-and-clicks operations do collect the sales tax from Internet customers. Migden cites Macy's Wal-Mart REI Hewlett-Packard and Eddie Bauer. Others refuse she says: Barnes & Noble Borders Books KB Toys Gateway Computers Radio Shack. ??Her bill simply clarifies that the sales tax applies when the e-tailer is affiliated with a California business sells identical products and they market jointly. ??Right now Migden contends certain big businesses blatantly violate the tax law and put hard-working honest small business people at a disadvantage. ??* ??Gov. Gray Davis is miffed at Migden she hears. He vetoed her bill last year declaring it would send the wrong signal about California's international role as the incubator of the dot-com community. Internet marketing must be given time to mature he maintained. ??Now Migden's at it again. The governor's exercised. He thinks I'm jamming him she says. But I'm moving the bill. He can veto it if he wants. I'm putting it on his desk. ??It already has cleared the Assembly tax committee and will shoot out of her panel Wednesday headed for the Assembly floor. Last year Democrats backed the bill. Republicans opposed it siding with the Democratic governor. ??Davis fears some future opponent will claim he signed a bill to tax the Internet. Migden is frustrated by that Internet tax tag calling it a lazy misinterpretation. ??I'm not picking on e-commerce she protests. I'm picking on the multinationals who are arrogantly evading the law in complicity with the state Board of Equalization. ??That would be in particular Republican board member Dean Andal of Stockton. It's the usual liberal nut case bill Andal says. Just a bill chasing no problem. ??* ??The BOE administers the sales tax. And Andal does agree that if an Internet purchase can be returned to a store the e-tailer legally must collect the tax. We've been looking into that he says. ??The board shouldn't have to look far. Barnes & Noble tells e-customers right on its Web site that you can return purchases to ANY Barnes & Noble store for in-store credit. ??But other than that Andal contends a company has a constitutional right to create an out-of-state subsidiary to avoid taxes. ??And he notes we're talking about relative pennies: $ 17 million annually the BOE estimates compared to $ 39 billion in total California sales tax collections. That lost revenue would cover only about seven hours worth of electricity the state now is buying for utilities. ??But e-tailing is bound to grow. Tax avoidance could become significant benefiting dot-coms while discriminating against small retailers and the poor who cannot afford Internet access. ??Migden will be in a strong position to change sales tax policy if she wins her race next year for the five-member BOE. She's the early front-runner. ??Her concern--her reverence--is for the local booksellers the mom-and-pop merchants the neighbor shopkeepers who can be smothered by the big tax evaders. The little guy with the books stacked in the back she says sweeping the sidewalk putting on extra locks obeying the law and collecting taxes--trying to make a go. ??Davis wants to be seen as a futuristic New Age pol worthy of campaign donations from wealthy Web masters. But he can manage that without tromping on his Democratic roots as protector of the little guy. LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 30 2001 Monday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 1808 words HEADLINE: CALIFORNIA AND THE WEST THE CALIFORNIA ENERGY CRISIS LIST OF PG&E CREDITORS SHOWS FIRM'S WIDE REACH IN BUSINESS BANKRUPTCY: IT INCLUDES SMALL AND BIG COMPANIES GOVERNMENT AGENCIES AND FORMER EMPLOYEES. BYLINE: TIM REITERMAN TIMES STAFF WRITER DATELINE: SAN FRANCISCO BODY: ??It reads like a phone book: Able Auto Body Able Building Maintenance Able Fence Co. Able Printing Able Termite & Pest Control. . . . ??These companies are among about 50000 entries on Pacific Gas & Electric Co.'s roster of creditors recently filed in U.S. Bankruptcy Court. ??Another company A&J Electrical Cable Corp. of Hayward has supplied PG&E with utility cables since 1980. But now the unpaid bills are hitting the $ 100000 mark--and that is a big deal to a relatively small business. ??Who would ever think that PG&E would be in bankruptcy? said owner Magdalene Reilly. This is something affecting people. I've got a lot of paychecks on Friday. ??We have orders for the rest of the year from PG&E she added. It is a question: Do you decide to ship? . . . We probably will. They are a good customer. ??When PG&E filed for Chapter 11 protection from creditors April 6 businesses from California to Canada were caught by surprise. The names of the 20 biggest creditors some with billion-dollar claims were filed with the court. The utility also submitted a list of potential creditors--more than 3500 pages worth. ??The roster speaks to the remarkable economic clout and reach of a company that prospered for almost a century before plunging into the third-biggest bankruptcy case in U.S. history. It provides a glimpse into the relationships between a giant utility--the state's largest--and businesses of all sorts and sizes. And it underscores the high stakes as a bankruptcy judge reorders PG&E's financial affairs and decides in the coming months if not years who should be paid and how much. ??The case said U.S. bankruptcy trustee Linda Ekstrom Stanley has a ripple effect. . . . Creditors are affected and they can't pay their bills either. ??There are small companies and conglomerates that sold power to PG&E. ??There are financial institutions from Wall Street to San Francisco's Montgomery Street that lent money or provided services. ??There are government agencies at all levels even the California Public Utilities Commission. ??There are some retired PG&E employees and officers including at least one of the company's former chief executive officers. ??But there also are vendors that have provided goods and services to PG&E for years: tree trimming around power lines bodywork for the utility's truck fleet fencing for its vast land holdings calibration of meters fans to cool electrical transformers printing of brochures signs for office doors flight suits for aviators who patrol power lines limousine service for traveling executives. ??No dollar amounts are attached to names on the master list. But records and interviews with dozens of creditors show that the sums owed range from hundreds of millions of dollars to very little--or nothing at all. Many of the smaller creditors were unaware they were on the roster until contacted by The Times. ??PG&E used to buy pump filters from California Pump & Supply in Sacramento. ??We just closed out their account because they owed us $ 29 said office manager Lisa Giordano. It's a hassle to get anyone over there. I just wrote it off. ??The utility bought $ 38 worth of plants from Forest Nursery in Los Osos west of San Luis Obispo. It's nothing to go to court about especially since they paid it said bookkeeper Lori Parsons. ??A wine wholesaler an ice cream company and a coastal hotel are listed. So is Sing A Long Productions in Burlingame which supples disc jockeys and karaoke. ??I am sure we have done business with PG&E and other companies that have parties from time to time said owner Nick Foster. Maybe somebody forgot that we did not get paid. ??PG&E spokesman Ron Low said the list includes everyone to whom the utility wrote a check in the last two years such as homeowners who received energy conservation rebates and retirees who received checks related to benefits. ??It was an attempt to notify anybody who possibly could have a claim against the company and to cast the widest net possible he said. ??Several PG&E retirees such as Robert W. Oliver of Berkeley were baffled by their inclusion on the list. I draw a little pension said Oliver who was a personnel executive and left the company in 1980. It's a vested pension. ??Another retiree on the list is former Chief Executive Richard A. Clarke. ??He and about 10 other former high-ranking PG&E executives or their survivors have retained an attorney to help ensure that their retirement benefits are protected during the bankruptcy case. ??We don't want someone to get the idea that this is a bunch of well-heeled executives trying to get a piece of the action said the attorney John T. Hansen. Some in our group are widows of former executives who depend on the pensions they receive as survivors. ??Hansen said some retired executives have deferred-compensation packages that might be considered a general unsecured bankruptcy claim. ??One concern he said is that PG&E Chairman Robert D. Glynn Jr. wrote recently in a San Francisco Chronicle op-ed article that health care plans and other benefits for employees and most retirees will continue. ??We would want to know what 'most' is Hansen said. We want to sort it out. ??Low of PG&E said fewer than 100 retired employees most former officers have a portion of their pension that is unsecured. That means their claims will be handled in Bankruptcy Court with those of other unsecured creditors whose debts are not backed by utility assets. ??The spokesman emphasized that ex-employees could be on the list because they received a check from the company for something. ??Companies and individuals on the list PG&E said will be contacted and given an opportunity to state their claims which the utility will file with the court May 11. ??Meanwhile the effects of the bankruptcy filing continue to ripple beyond the utility. ??PG&E's action hit AA Safe & Lock Co. in Santa Cruz particularly hard. The firm replaces keys and locks for PG&E offices and trucks. ??We are a small business and it is a big account said owner Paul Bing who declined to say what the utility owes. We haven't been doing as much for them since the whole crisis started. ??A Hayward firm that conducts environmental testing when PG&E remodels or razes buildings is out money too. Ken Byk president of Forensic Analytical would not provide a figure but said: I am obviously concerned. . . . They are a good customer but any time you run into these problems it's disappointing. ??California Steam Inc. of Sacramento services PG&E pressure washers and water recyclers at its truck-cleaning facilities. I have just a couple of invoices out said service manager Bruce Amlin. The debt he said is less than $ 500. ??A similar amount is owed to California Turbo Inc. in Ontario. Sales manager Cam Young said the utility has not paid for eight fans used to cool electrical transformers. We're a small business Young said adding with a laugh: We might have to eat peanut butter and jelly for four or five months. ??Within days of the bankruptcy filing PG&E sent about 12000 creditors letters that began: Valued Goods and Services Provider: . . . Unfortunately the bankruptcy code precludes payment for goods and services received prior to the date of filing. Payments on this pre-petition debt will be settled as part of the plan of reorganization. The company assured vendors that they will be paid for any future purchases. ??Some are not only forgiving they are outspokenly loyal to PG&E. ??The relationship between the utility and AG Signs of Stockton spans two decades. When Tony Guebara was starting his company PG&E gave him business. They try to help the little guy he said. Just about everybody in town is a vendor. They have people here who paint their trucks. ??AG Signs now has five employees and supplies PG&E with door lettering for trucks name plaques for office doors and signs and flags for construction sites. ??Guebara said the utility's debt does not worry him: PG&E has treated me real well. If I lose a couple of bucks because of this adversity that is OK. . . . I don't think we've seen the last of PG&E. ??Many businesses and individuals said they had no idea why the company believes it owes them money. ??Being included on the creditors list left the Vallejo Camp Fire Girls & Boys and other charitable organizations somewhat confused. Officials of one Berkeley church could only speculate that it was listed because PG&E stock was bequeathed to the congregation decades ago. ??Twylah Lemargie manager of the Cancer Aid Thrift Shop in Grass Valley said the utility is not even a customer. PG&E did come in and replaced lots of our ceiling lights with the long tubes she said. But it was done free as an energy saver. ??A number of vendors said PG&E's account is paid up. ??The utility rented temporary housing units for workers on a hydroelectric project about two years ago but California RV Rentals in Rio Lindo is still named as a creditor. They don't owe me money said Sandra Weaver the manager. If they want to give me some it's OK. ??Many creditors are health clubs and health care providers: medical and dental offices foot and joint specialists pharmacies chiropractors. ??When informed that the Castro Valley Chamber of Commerce was on the creditors list the woman who answered the phone laughed uproariously. Then Executive Director Bonnie Dettmer came to the line. ??I'm going to guess it's membership dues she said. They are a member and they have been very supportive. I would bet they belong to every chamber of commerce. ??One creditor is the state agency that PG&E says drove the company into insolvency by not allowing full recovery of its wholesale power costs. ??They owe us $ 5.9 million . . . for environmental impact reports on PG&E projects said Paul Clanon director of the Public Utilities Commission's energy division. It's a serious amount of money but currently is not having an impact. ??Top 10 Creditors ??The creditors owed the most money by Pacific Gas & Electric Co. according to the company's Chapter 11 filing: ???Creditor owed ???Bank of New York ????????????????????????$2.20 billion ???California Power Exchange ???????????????$1.96 billion ???Bankers Trust Co. ???????????????????????$1.30 billion ???California Independent System Operator ??$1.12 billion ???Bank of America* ?????????????????????????$938 million ???US Bank million ???Calpine Gilroy Cogeneration LP ????????????$58 million ???Calpine Greenleaf Inc. ????????????????????$49 million ???Crocket Cogen million ???Calpine King City Cogen LLC ???????????????$45 million ??* Heading a group of banks ??Source: U.S. Bankruptcy Court Northern DIstrict of California GRAPHIC: GRAPHIC: Top 10 Creditors Los Angeles Times PHOTO: Magdalene Reilly owner of A&J Electrical Cable Corp. of Hayward says her company has supplied Pacific Gas & Electric with utility cables since 1980 and that their unpaid bills are now hitting the $100000 mark. ?PHOTOGRAPHER: ROBERT DURELL / Los Angeles Times PHOTO: They try to help the little guy says Tony Guebara owner of AG Signs in Stockton of PG&E. He has been doing business with utility for two decades. ?PHOTOGRAPHER: ROBERT DURELL / Los Angeles Times LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 30 2001 Monday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 1228 words HEADLINE: CALIFORNIA AND THE WEST THE CALIFORNIA ENERGY CRISIS POWER WOES COMPLICATE DISCUSSIONS ON BUDGET FUNDING: GOV. DAVIS' PLAN FOR NEXT YEAR FACES DEMANDS FOR BILLIONS AS A RESERVE AND TO CUSHION ELECTRICITY RATE HIKES. BYLINE: DAN MORAIN TIMES STAFF WRITER DATELINE: SACRAMENTO BODY: ??Jockeying over the state's next spending plan a tradition that usually takes place in the summer already is turning intense as the energy crisis casts a pall over what otherwise might have been relatively painless budget squabbles. ??A key state senator worried about the slowing economy is looking for places to pare as much as $ 4 billion from Gov. Gray Davis' proposed $ 104.7-billion budget. And Republicans are beginning to demand that the state spend billions in general tax money to cushion electricity rate hikes of up to 40% being imposed on consumers and businesses. ??Davis won't sign the budget for the 2001-02 fiscal year into law until late June at the earliest. But with California mired in the energy crisis and the economy slowing the new budget is shaping up to be especially vexing. ??California's largest utility and a major private employer Pacific Gas & Electric is in bankruptcy. The state has spent $ 5.2 billion in general tax money to buy electricity with no end in sight. Even before summer temperatures hit Sacramento shelled out $ 90 million to buy electricity in a single day last week. ??And the Wall Street rating firm Standard & Poor's unsure that the state will be reimbursed for the power purchases lowered California's credit rating two notches for the first time since the recession of the 1990s. ??Brightening an otherwise cloudy situation income tax payments are meeting or exceeding predictions. More than $ 8 billion in checks from April income tax returns have flooded into the Franchise Tax Board said Department of Finance economist Ted Gibson. On one day last week the state's haul was $ 3.6 billion a record. ??Receipts are very much on track I'm relieved to tell you Gibson said. ??But even as budget writers were exhaling the payments merely offered proof that the economy was strong last year back when then-President Bill Clinton was heralding the longest period of economic growth in U.S. history and Californians' lexicon did not include the term rolling blackout. ??State income and sales tax receipts softened in the first few months of 2001 an indication that people will be earning less this year--and paying less in taxes next year. ??Seeing trouble ahead Senate Budget Committee Chairman Steve Peace (D-El Cajon) wants to boost the state's emergency reserve which was $ 1.9 billion in January. To do that Peace last week called on budget committee members to come up with a list of cuts totaling $ 2 billion to $ 4 billion. ??Without a larger reserve heading into 2002 Peace said the slowing economy could force the state to make deep cuts or raise taxes next year at a time when most legislators and Davis will be running for reelection. ??The thing to be worried about is not the current year but the trend line Peace said. ??He adds a caveat for the spending plan that by law must be in place by July 1: There will be cuts if legislators fail to approve legislation that state Treasurer Phil Angelides says he needs to obtain short-term loans and market long-term bonds to finance electricity purchases. ??Davis and Angelides are preparing the largest bond sale--a way that government borrows money--in U.S. history as much as $ 12.4 billion. The state would use the proceeds to ease the shock to utility customers of record high electricity prices this year. The bond debt would be paid off over a period of perhaps 15 years. ??Given the size and complexity of the bond issue many legislators say Angelides may not be able to sell it for months. ??Davis however has an immediate need for money. The governor must release a revised state budget within weeks. So he is pushing for legislators to approve legislation that would allow Angelides to obtain a short-term loan of as much as $ 6 billion. ??At least some of the proceeds of the long-term bonds would be used to pay off the short-term loan--sort of like using one credit card to pay the balance on a second piece of plastic. ??Republican legislators are balking at the idea. ??Back in December before the state entered the power buying business GOP legislators had called for $ 3.2 billion in tax cuts. With the energy crisis complicating the financial situation some Republicans are contending that Davis should use as much as $ 5 billion from the budget surplus to soften the impact of electricity rate hikes. ??That will be a de facto tax cut said Senate Republican leader Jim Brulte of Rancho Cucamonga. Our Democratic friends want to do the bridge financing so they can increase the size of government. ??Republicans are in the minority. But they have a significant voice because state law requires that both houses of the Legislature approve spending decisions by a two-thirds vote. ??The state Constitution says the budget must be in place by the July 1 start of the new fiscal year. Davis signed his first two budgets on time. Given this year's uncertainties however some legislators are thinking twice about making July vacation plans. ??The sudden turnaround may come as a shock to many legislators and lobbyists who seek slices of the state budget pie. ??In recent years legislators have grown used to the multibillion-dollar windfalls of tax payments which allowed them to deliver new swimming pools school programs museums parks social and health care spending and tax cuts to their constituents. Indeed the budget in Davis' first two years grew 37% even as the Democratic governor and legislators cut taxes by $ 3.9 billion. ??In a Legislature populated by term-limited newcomers only a handful of current legislators were in the Capitol in the early 1990s when the worst recession to hit California since the Great Depression caused the state budget to actually shrink. Then-Gov. Pete Wilson and the Legislature reacted to a $ 14-billion budget gap by raising taxes by more than $ 5 billion and slashing spending. ??It is not going to be the pie-in-the-sky budget some of us thought it would be last year and even as late as January said Sen. Jack O'Connell (D-San Luis Obispo). ??Veterans of the annual summer rite say there is no template for the coming budget fights. Jean Ross of the California Budget Project a private budget watchdog and advocacy group said Davis and legislators not only must pay attention to the economy. ??They also must take into account many unknowns: Will the judge overseeing PG&E's bankruptcy proceeding seek to raise rates further? Will federal energy regulators be able to effectively limit wholesale electricity costs? What will the economic impact be of summer blackouts? ??It's a lot more complex and unpredictable than other years Ross said. ??Legislators say they are lowering their sights. But letters from state senators requesting money for their favored projects fill five large red binders. You wouldn't know there is a money shortage based on requests in appropriations said Assembly Appropriations Committee Chairwoman Carole Migden (D-San Francisco) preparing for what she calls her hatchet role of blocking bills that require spending. ??For his part Davis has not decided to significantly cut back on his proposals ranging from a sales tax holiday timed for back-to-school shopping to plans to clean sewage from beaches. He won't reveal those decisions until he releases his revised spending plan. LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 30 2001 Monday Home Edition SECTION: Metro Part B Page 7 Op Ed Desk LENGTH: 839 words HEADLINE: COMMENTARY WILL THE FERC SEE THE LIGHT ON THE LAW? BYLINE: FRANK A. WOLAK Frank A. Wolak an economics professor at Stanford University is chairman of the Market Surveillance Committee of the California Independent System Operator BODY: ??Out-of-state firms selling into the California wholesale electricity market at exorbitant prices have been blamed for the current electricity crisis. They are claim many observers exercising their market power to raise wholesale electricity prices. ??Although it is not illegal under California or U.S. antitrust law for a firm to exercise its market power it is illegal to do so under the Federal Power Act. The Federal Energy Regulatory Commission or FERC which regulates the California wholesale electricity market is the entity charged with enforcing this law. Its refusal to take sufficient actions that would result in just and reasonable wholesale electricity rates is the fundamental cause of California's current energy crisis. It is highly unlikely that anything it has done in the last week has changed things at all. ??In 1935 Congress passed the Federal Power Act and required the Federal Power Commission (the predecessor to FERC) to set just and reasonable wholesale electricity prices. Just and reasonable prices are those that recover production costs including a fair rate of return on the capital invested by the firm. Moreover if the FERC finds that wholesale electricity prices are unjust and unreasonable the Federal Power Act gives it wide-ranging discretion to take actions that result in just and reasonable prices. The FERC can also order refunds for any payments by consumers in excess of just and reasonable prices. ??Almost 10 years ago the FERC began to allow generators to receive market prices instead of prices set through a cost-of-service regulatory process. However there is no guarantee that market prices meet the just and reasonable standard required by the Federal Power Act. Markets often set prices substantially in excess of the production costs for significant periods of time. This occurs because one or more firms operating in the market have what economists call market power--the ability of a firm to raise market prices and profit from it. ??However if no firm possesses market power the market price should be very close to a price that only recovers production costs. In such a circumstance the price set by the market satisfies the just and reasonable standard of the Federal Power Act. ??Before it allows any market participant to receive a market price rather than a cost-based price set through a regulatory process the FERC requires each participant to demonstrate that it does not have market power. In other words each market participant must submit sworn testimony to the FERC demonstrating it does not have the ability to raise market prices and profit from this behavior. ??Each of the out-of-state generators made these filings before they began selling into the California market which started in April 1998. Each firm had its authority to receive market prices approved by the FERC for a three-year period that ends before this summer for several of the firms. It is virtually impossible to determine on a prospective basis whether a firm possesses market power. Moreover the methodology used by the FERC to make this determination uses analytical techniques that have long been acknowledged by the economics profession as grossly inadequate. The events of the past 10 months have demonstrated that contrary to their filings stating otherwise all of the out-of-state generators possess significant market power. ??A number of independent studies have shown that the market power exercised by these firms has resulted in unjust and unreasonable rates from May 2000 until now. Moreover in its Dec. 15 2000 report on the California electricity market the FERC concluded that wholesale electricity prices during the summer and autumn of 2000 were unjust and unreasonable and reflected the exercise of significant market power. ??Despite its own conclusion the FERC thus far has refused to set just and reasonable prices for wholesale electricity in California. Instead the FERC implemented market rule changes that have enhanced the ability of these firms to set excessive wholesale electricity prices. In addition it has refused to order refunds for any overpayment during the summer and autumn of 2000 for the prices that it deemed unjust and unreasonable. ??Fortunately for California consumers the California Public Utilities Commission and Gov. Gray Davis refused to be accomplices in the FERC's decision not to enforce the Federal Power Act. They refused to pass on to California consumers prices that the FERC itself had determined were unjust and unreasonable. ??Because these out-of-state firms must apply for renewal of their market-based pricing authority before this summer the FERC has one more opportunity to set just and reasonable prices for wholesale electricity in California. It has before it several proposals that would enforce all provisions of the Federal Power Act. The health of the California and national economies would be severely undermined if the FERC continues to ignore its legal obligations. LOAD-DATE: April 30 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 The New York Times Company New York Times ?????????????????April 30 2001 Monday Late Edition - Final SECTION: Section A Page 1 Column 5 Business/Financial Desk LENGTH: 1444 words HEADLINE: While a Utility May Be Failing Its Owner Is Not BYLINE: ?By By RICHARD A. OPPEL Jr. and LAURA M. HOLSON BODY: ??Pacific Gas and Electric the giant California utility may have just made one of the largest bankruptcy filings in history but it has been a banner year for the rest of its parent company the PG& E Corporation. ??In Bethesda Md. far from the energy crisis in California another PG& E subsidiary National Energy Group earned $162 million last year and ranked as the nation's third-largest power trader. Compensation for the unit's executives soared. Many investors now believe that the subsidiary just a decade in the making is by itself worth more than its 96-year-old utility sibling. ???How did National Energy get so big so fast? By using cash partly generated by its sister utility to buy unregulated power plants in the Northeast expand trading-floor operations and sell power across the country. The exact numbers are in dispute but much of Nationals Energy's profits last year came from California. ??Most other large utilities have done the same thing over the past decade building national or even global power companies from roots in local monopolies. But nowhere is the success of these unregulated businesses more of an issue than in California where PG& E's investments may be challenged in bankruptcy court. ??Still such transfers of assets were fundamental to deregulation plans in two dozen states and they were encouraged by federal rules designed to build a new wholesale marketplace in electricity. ??And today the offspring of the nation's utilities dominate that market after industry leader Enron. ?Eight of the nation's 10 largest power marketers are affiliates or spinoffs of regulated utilities controlling about 42 percent of power trading. ??It is largely these unregulated power producers and traders whose sales of power in California have prompted accusations by state leaders of price gouging and demands for the price caps that federal regulators took their first halting steps toward embracing last week. ??The profitability of the utilities' unregulated operations is becoming clear as companies report earnings for the first three months of the year. ??For example Reliant Energy reported that operating income at its unregulated wholesale energy business soared to $216 million in the first quarter or 16 percent more than at its regulated utility which serves Houston. This week Reliant expects to spin off its unregulated businesses through an initial public stock offering that would put a market value on the new company of as much as $8.8 billion -- more than the rest of Reliant. ??A number of other major utility companies have spinoffs or trading and generation units that now earn nearly as much as or more than their core utility operations. These include Duke Energy in Charlotte N.C. Sempra Energy of San Diego the Southern Company in Atlanta the Constellation Energy Group in Baltimore and Utilicorp United in Kansas City Mo. ??In some places the growth of the unregulated businesses continues to raise questions of fairness -- particularly where utilities have been permitted to transfer plants to the new units at deep discounts to their market value. Critics say that ratepayers whose bills paid for the plants' construction should benefit more when the plants are sold. ??In Florida a commission on energy deregulation formed by Gov. Jeb Bush has proposed permitting such transfers on the grounds that they are needed to create a new wholesale marketplace. Opponents including the Florida Municipal Electric Association which represents utilities owned by local governments say the plan would produce a $9 billion windfall that should go to ratepayers. ??In California some creditors of Pacific Gas and Electric have signaled that they will want the bankruptcy court in San Francisco to review parent PG& E's efforts to keep its unregulated businesses out of creditors' reach. ??And the California Public Utilities Commission is investigating whether PG& E and Edison International whose Southern California Edison utility unit is also near insolvency have improperly transferred cash to their parents and to unregulated sister companies. ??A recent audit ordered by the commission showed that Pacific Gas and Electric transferred $4.1 billion to PG& E from 1997 to 1999. Most of that went to dividends and stock repurchases but $838 million was invested in other subsidiaries primarily its National Energy Group unit. Southern California Edison transferred $4.8 billion to its parent company between 1996 and November 2000 a separate audit showed Edison International invested $2.5 billion in its unregulated Mission Group subsidiaries during the same period. ??Executives of the companies say the transfers were proper. Audits have shown that we followed the rules and didn't do anything wrong said PG& E's chief executive Robert Glynn. We did not ask consumers in California to support any of the losses that occurred in those businesses when we started them up he said. Now forcing the unregulated units to support their ailing sister utility he said would be no different than calling up shareholders and saying 'The California electric bills are pretty high send some money in so we can give it back to them.' ??Loretta Lynch the president of the utilities commission took a different view. Should we look backward she asked and say 'Hey wait a minute -- that corporate structure profited by all of our power payments to them in the past and they should participate in helping us through to get to a solution in the future?' ??The cornerstone deal of PG& E's unregulated energy business was struck four years ago when it acquired the hydroelectric and fossil-fueled generation plants of New England Electric System for $1.6 billion. PG& E is now one of the largest generators in the Northeast operating plants that can light up to five million average-sized homes. ??While California officials say Pacific Gas and Electric's woes have been caused at least in part by market manipulation by out-of-state generators the Justice Department has been investigating possible market abuses involving PG& E and two other companies in New England. Mr. Glynn said that PG& E had done nothing wrong and that the company has responded to Justice Department requests for information. ??Overall PG& E's National Energy Group has 30 power plants in 10 states and others under development or construction that include one in Athens N.Y. that is expected to begin supplying electricity to New York City in 2003. It also operates an energy trading operation in Bethesda and controls a natural gas pipeline into Northern California. ??To Wall Street the utility companies' investments in unregulated businesses were a necessary survival tactic as investors demanded faster-growing profits. ??The stock market was going like gangbusters and the utilities' returns of 11 percent weren't cutting it said Richard Cortright a utility analyst at Standard and Poor's the bond rating agency. ??Moreover as deregulation loomed industry executives saw no choice but to make new investments. It looked like the utility opportunity was going to start shrinking Mr. Glynn said. ??Consumer groups question whether utilities would have invested more in improving basic service if they had not had the option of putting money elsewhere. ??Mike Florio a lawyer with The Utility Reform Network a consumer group in San Francisco cited findings last year by state regulators that from 1987 to 1995 Pacific Gas & Electric spent nearly $550 million less on maintaining electric and gas facilities than had been factored into its rates. Separately in 1999 the utility agreed to pay about $29 million to settle charges that consumers were endangered because it failed to trim trees near high-voltage power lines. ??Several hundred million dollars didn't get spent for maintenance and that ultimately falls to the bottom line as profit Mr. Florio said. ??Mr. Glynn said the utility had always spent appropriate sums on maintenance coming within one-half of one percent of the amount built into rates over a 20-year period. ??In the big picture he said it was hard to see how PG& E had been a winner in deregulation even before its utility's humiliating bankruptcy. If you look at what happened the net of it was a loss Mr. Glynn said because the value leaked out on the regulated utility side faster than we were able to build it on the nonregulated side. About This Report ??This article is part of a joint reporting effort with the PBS series Frontline which will broadcast a documentary about California's energy crisis on June 5. ??http://www.nytimes.com GRAPHIC: Charts: The Biggest Power Marketers Most of the biggest unregulated power marketers and traders are owned by the the country's biggest electric utilities or have been spun off by them. Here are the top 10 based on 2000 sales. Companies owned or spun off from utilities: Enron Power and affliliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 590.2 MARKET SHARE: 13.03% CHANGE FROM 1999: + 97% Companies owned or spun off from utilities: American Electric Power Service MEGAWATTS SOLD IN 2000 (IN MILLIONS): 401.3 MARKET SHARE: 8.86 CHANGE FROM 1999: +84 Companies owned or spun off from utilities: PG&E Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 282.6 MARKET SHARE: 6.24 CHANGE FROM 1999: +62 Companies owned or spun off from utilities: Duke Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 276.2 MARKET SHARE: 6.10 CHANGE FROM 1999: +226 Companies owned or spun off from utilities: Reliant Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 204.3 MARKET SHARE: 4.51 CHANGE FROM 1999: +166 Companies owned or spun off from utilities: Mirant Americas Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 202.6 MARKET SHARE: 4.47 CHANGE FROM 1999: +23 Companies owned or spun off from utilities: Aquila Energy Marketing MEGAWATTS SOLD IN 2000 (IN MILLIONS): 186.7 MARKET SHARE: 4.12 CHANGE FROM 1999: +4 Companies owned or spun off from utilities: Cinergy operating companies MEGAWATTS SOLD IN 2000 (IN MILLIONS): 166.4 MARKET SHARE: 3.67 CHANGE FROM 1999: +246 Companies owned or spun off from utilities: Constellation Power Source MEGAWATTS SOLD IN 2000 (IN MILLIONS): 162.3 MARKET SHARE: 3.58 CHANGE FROM 1999: +222 Companies owned or spun off from utilities: Williams Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 138.4 MARKET SHARE: 3.05 CHANGE FROM 1999: +127 (Source: Platt Power Markets Week)(pg. A17) Outdoing Their Parents Taking advantage of deregulation many of the country's biggest power utilities have set up unregulated subsidiaries to trade and produce power. These subsidiaries have become extremely profitable often outperforming their regulated corporate siblings. UTILITY: Duke Energy OPERATING INCOME (MILLIONS) 1Q '00: +$465 1Q '01: +460 UNREGULATED BUSINESS: North American Wholesale Energy OPERATING INCOME (MILLIONS) 1Q '00: +82 1Q '01: +348 RELATIONSHIP OF UNREGULATED BUSINESS TO UTILITY North American Wholesale Energy is a subsidiary of Duke Energy. UTILITY: Reliant Energy OPERATING INCOME (MILLIONS) 1Q '00: +$202 1Q '01: +186 UNREGULATED BUSINESS: Wholesale Energy OPERATING INCOME (MILLIONS) 1Q '00: -22 1Q '01: +216 RELATIONSHIP OF UNREGULATED BUSINESS TO UTILITY Reliant Energy plans to sell 18 percent of Reliant Resources -- mostly Wholesale Energy -- this week. UTILITY: Southern OPERATING INCOME (MILLIONS) 1Q '00: +$439 1Q '01: +483 UNREGULATED BUSINESS: Mirant OPERATING INCOME (MILLIONS) 1Q '00: +169 1Q '01: +279 RELATIONSHIP OF UNREGULATED BUSINESS TO UTILITY Southern completed the spinoff of Mirant on April 2. (Source: S.E.C. filings)(pg. A17) LOAD-DATE: April 30 2001 of 103 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????APRIL 30 2001 MONDAY FINAL EDITION SECTION: NEWS Pg. A3 LENGTH: 1108 words HEADLINE: NEWSMAKER PROFILE Nettie Hoge Taking on power Consumer advocate revels in uphill battle SOURCE: Chronicle Staff Writer BYLINE: Chuck Squatriglia BODY: Given a choice Nettie Hoge would rather be out in her garden right about now digging in the dirt. ???Instead the head of The Utility Reform Network is digging into California's energy mess making sure the average Joe doesn't take it in the kisser as lawmakers regulators and utility brass hats try to keep the lights on and utilities afloat. ???It's grueling work full of long hours that leave precious little time for the gardening Hoge so adores. Not that she's complaining. Hoge 50 honestly loves her job and insists she wouldn't do anything else. ???I've got a mutant gene she said with a laugh as she relaxed for just a moment in a spartan office littered with messy piles of paperwork. I've always wanted to do this. ???TURN has been keeping tabs on companies like Pacific Gas and Electric Co. and Pacific Bell for more than 25 years. Hoge and her crew lobby the Public Utilities Commission counsel lawmakers analyze reports and file the occasional lawsuit. They are in short professional gadflies who represent the public in a system that some say favors big business. ???The biggest protector of the consumer by far has been TURN said Bob Gnaizda public policy director for the Greenlining Institute in San Francisco. (Hoge) has made TURN into the leading consumer utility advocate in the nation. ???It's not glamorous work nor is it particularly lucrative. Hoge a lawyer by training took a pay cut when she accepted the $75000-a-year job in 1995. And truth be told most folks have no idea Hoge is in their corner. ???There are other rewards she said. You don't get the adoration of Joe Citizen standing up and yelling 'Yay TURN!' But there's an excitement about being involved in the discussions where the big decisions are made. ???The youngest of four children Hoge bounced around the middle of the country as she grew up following her career Army officer father from Kansas to Oklahoma to Texas. ???All the places where you can shoot big guns she joked. ???Hoge graduated from high school in Pullman Wash. After a stint at the University of Southern California she graduated Phi Beta Kappa from Washington State University and earned a law degree from the University of San Francisco. ???Hoge's entire career has been spent protecting the underdog. During a two-year stint as a law school graduate at Brobeck Phleger & Harrison in San Francisco I got into trouble for doing too much pro bono work Hoge recalled. The partners would come around each month to check our billable hours. Mine were always zero. ???Since taking the helm almost six years ago Hoge has led TURN to some impressive consumer victories. They include persuading the Public Utilities Commission to create a $352 million fund to underwrite rural telephone service and bringing an end to ratepayer subsidies of PG&E's Diablo Canyon nuclear power plant in 2002. ???Hoge a stickler for detail has a reputation for giving exhaustive answers to even mundane questions. ???Everybody agrees she knows what she's talking about said Harvey Rosenfield president of the Foundation for Taxpayer and Consumer Rights. In many respects TURN is the intellectual force in this debate. Those of us who are deeply involved in this issue rely upon Nettie to lay out the facts for us. ???Hoge is surprised people think her wonkish but admits she is circumspect. ???My big fear is being marginalized and having people think we (at TURN) don't know what we're talking about she said. Maybe I overcompensate. ???Few doubt Hoge's smarts but she has plenty of critics among the utilities lawmakers and lobbyists she has crossed swords with over the years. However none of them will say anything publicly. ???We have no comment on her said Shawn Cooper a spokesman for Pacific Gas and Electric Corp. the parent company of the foundering utility. ???It was the same story with Southern California Edison and many of the legislators who have criticized Hoge and TURN in recent years. ???Hoge isn't surprised her adversaries are keeping mum. ???There's nothing for them to gain by saying anything negative about us because the public is on our side she said. ???Still TURN has drawn criticism from Carl Wood generally considered the most ardent consumer advocate on the PUC. ???Frankly I would have expected myself to be on the same page with (TURN) more than I actually am Wood said. I'm not sure they wholeheartedly believe in regulation and I think it comes from a distrust of regulators. But maybe I'm taking it personally. ???Wood chastised TURN for supporting utility divestiture of generating plants as California's deregulation effort got under way. And he said Hoge places too much emphasis on the utilities' role in the energy mess instead of focusing on the profiteering of power generators. ???The utilities have some culpability but they are not the main driver behind the crisis Wood said. TURN's interventions do not reflect that reality. ???Still he gave TURN high marks and credited Hoge with making it a far more effective advocate. ???Hoge admits she has had her hands full with the energy crisis saying she and her staff are trying to keep our health and sanity. ???Asked if she would have joined TURN if she had known how crazy California's energy market would become and how hard she would have to work Hoge was characteristically wary. ???I don't think anyone would want to sign up for this she said after a moment's pause. On the one hand it's very serious very rewarding work. But on the other hand sometimes you're just beating your head against the wall. ???Still Hoge doesn't plan to give up the fight anytime soon. ???But at some point I'd like to retreat and spend some time contemplating the forest for the trees. ???Or the garden for the plants. ??Nettie Hoge -- Age: 50. ???-- Residence: Oakland. ???-- Job: Executive director The Utility Reform Network October 1995 to present. The utility and telecommunications industry watchdog group in San Francisco represents consumers before the Public Utilities Commission the Legislature and elsewhere. ???-- Education: Bachelor's degree in communications Phi Beta Kappa from Washington State University 1976. Law degree cum laude from University of San Francisco 1985. ???-- Background: Most of Hoge's 25-year career has been spent protecting the little guy first as a social worker and later as an attorney with Consumers Union and the California Department of Insurance under Insurance Commissioner John Garamendi.E-mail Chuck Squatriglia at csquatriglia@sfchronicle.com. GRAPHIC: PHOTO (1) Nettie Hoge is respected for her encyclopedic knowledge of regulatory issues. (2) Nettie Hoge has headed The Utility Reform Network for six years. I've always wanted to do this she says. / John O'Hara/The Chronicle LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 The Washington Post Washington Post ????????????????????April 30 2001 Monday Final Edition SECTION: A SECTION Pg. A03 LENGTH: 1669 words HEADLINE: Energy Forecast for Summer: No Blackouts but Price Spikes Grid Managers Promote Conservation Await New Plants BYLINE: William Claiborne Washington Post Staff Writer DATELINE: CHICAGO BODY: ??The rest of the United States is virtually certain to escape rolling blackouts this summer like the ones that have plagued California but record price hikes for electricity are likely in many places energy experts agree. ???Despite their confidence that they can survive everything but an extremely hot summer without power outages managers of the nation's interconnecting electrical power grids are anxiously awaiting new power plants that are scheduled to come on-line. They are also promoting more frugal consumption by power customers and seeking ways to avoid distribution logjams during peak demand periods this summer. ???We see a big distinction between California and the rest of the country said David Costello an economist in charge of short-term forecasting for the Energy Information Administration the statistical arm of the Department of Energy. We have no real reason to believe anyplace is unusually at risk. ???But record spikes in the price of electricity are a given for this summer some industry analysts say because a growing proportion of power plants now run on natural gas which has doubled in price over the past year. ???The DOE estimates that electricity demand will grow 2.3 percent nationally this year with much higher increases in the West and the South. At the same time the reserve capacity margin that utilities try to build into their systems to handle the hottest days -- when use of air conditioners and other appliances taxes supplies -- has been falling in some regions to well less than the desired 15 percent above peak summer loads. ???That means utilities may have to import large volumes of electricity over transmission systems that were not designed to handle them. What power officials are hoping to avoid are critical shortfalls in generating capacity in some regions followed by overwhelming strains on aging high-voltage transmission lines as power is bought and sold across the country in increasingly competitive electricity markets. ???Even though scores of new power plants have been built in the Northeast South and Midwest in recent months and many more are on the drawing boards the expected 15 percent increase in new generation will not be fully on-line for another two years. That leaves parts of the nation vulnerable to outages if there are prolonged heat waves this summer or if utilities are unable to start up new or rebuilt gas-fired power plants as scheduled according to energy experts. ???Despite all those potential problems there is no reason to believe that California's power nightmares will spread to the rest of the country officials said. ???This year utilities have announced they are adding 40 to 50 gigawatts of new generating capacity to gas-fired plants across the nation compared with only 22 gigawatts that were added last year Costello said. He said that even if half of those announced plants never materialize this year's new capacity is certain to be as great or greater than last year's meaning that the predicted increased consumption can probably be met. A gigawatt is 1000 megawatts or enough to power about 1 million homes. ???We don't know that [transmission] infrastructure has really been fixed but my sense is they're in better shape overall as far as capacity is concerned Costello said. ???The nation's 203600-mile high-voltage network has undergone relatively few changes in 50 years during which deregulation has prompted electricity wholesalers to sell power at even greater distances to reach more lucrative markets adding to the pressure on the grid system. ???California in a sense has been serving as a stalking horse for other states some of which also deregulated their electricity systems and are consciously avoiding doing anything that resembles the California model. ???Eugene Gorzelnik spokesman for the North American Electric Reliability Council (NERC) which oversees the interlocking power grids said: Obviously there will be problems in California and there's nothing that's going on that will solve those problems. But a lot of [utilities] people are looking at California and saying to themselves 'Can I do this in a way they didn't?' That's a positive development. ???Apart from California the worst problems are expected in adjoining western states as Golden State electrical grid managers scramble to buy electricity at a time when power production at the region's hydroelectric dams is already being cut because of shrinking water levels in reservoirs. ???The Northwest Power Planning Council recently reported that the demand for electricity has grown 24 percent in the past decade while new generation has grown only 4 percent. ???NERC is not expected to issue its long-awaited pre-summer electricity reliability assessment -- a document that forecasts peak generation and consumption -- until next month. But in interviews officials of many of the 10 regional reliability councils that comprise the national grid system appeared fairly sanguine about the prospect of avoiding widespread brownouts this summer. ???Assuming normal weather and assuming our generating units come off maintenance on schedule we don't anticipate any particular problems meeting our loads said Bill Reinke executive director of the Southeastern Electricity Reliability Council. ???Reinke said the region was adding 300 miles of new transmission lines has 5600 megawatts of new generating capacity -- enough to power 5.6 million homes -- and is seeking to identify potential transmission bottlenecks so it can take preemptive corrective measures against distribution failures. ???Outside the West the greatest potential for blackouts may be in New York where the near certainty of transmission logjams in an antiquated infrastructure prompted Consolidated Edison Co. to request approval for 11 combustion turbine mini-generators in case of a power shortage. Residents and conservationists are appealing court approval of the generators on environmental grounds. ???Stephen Allen spokesman for the Northeast Power Coordinating Council said If the 400 megawatts the generators provide go on-line it'll still be tight but New York should be okay. He said Upstate New York should have surplus electricity to sell to New York City although some experts say transmission bottlenecks could make it difficult for New York City to import power on abnormally hot days. ???New York City customers who have already had their electricity rates increased 40 percent in the last two years could see prices rise an additional 50 percent because of the deregulated power industry's dependence on gas-fired generation according to some analysts. ???Allen said that since last June New England has added mostly gas-fired plants that generate more than 1000 megawatts and should have an additional 2000 megawatts on-line before the end of the summer. He said the region should have a 15 percent to 18 percent capacity margin. ???The Mid-Atlantic Area Council made up of Maryland Virginia the District of Columbia Delaware New Jersey and Pennsylvania is expecting a reserve margin of more than 16 percent and an increase of 2100 megawatts in generating capacity over last year to about 60000 megawatts according to the council's president Phillip G. Harris. Harris said the council met last year's peak of 49288 megawatts with no problems though the summer of 2000 was relatively cool. ???Harris cited several reasons why we are not like California including a decision to centralize all planning which California did not the creation of a regional market instead of a state-based marketplace like California's and a policy of only slow incremental changes in the grid. ???A single misstep can have huge consequences Harris said. We're tinkering with something that has worked for 100 years so you better do it right. ???In the Midwest utilities expect a peak demand this summer of 55221 megawatts compared with 52214 megawatts last summer according to Richard Bulley executive director of the six-state Mid-America Interconnected Network. But keeping pace with the nearly 6 percent increase in demand is the addition of 5470 megawatts of capacity Bulley said. ???We do not anticipate any major limitations on the region's bulk transmission system and we project a healthy reserve margin of more than 18 percent he said. ???Since 1998 33 companies have proposed projects in Illinois totaling 25000 megawatts of gas-fired power. Although no one expects all of that to come on-line the state's total generating capacity is just under 34000 megawatts meaning that even if only a modest amount of the anticipated power was added the region would have a cushion even in a hot summer. ???Officials of Commonwealth Edison Co. the biggest utility in Illinois say that new or rebuilt electrical distribution facilities should prevent a repeat of the kind of disastrous power outages that crippled offices in Chicago's Loop last summer when lines broke and transformers burst into flames. ???Few power grids are in as good shape as Texas's. The state anticipates a 23 percent power margin this summer and the addition of 9188 megawatts of new generating capacity this year according to Heather Tindall spokeswoman for the Electric Reliability Council of Texas (ERCOT). Texas utilities have 27 new power plants under construction and 31 more in the planning stages she said. ???As a result ERCOT is forecasting almost 70000 megawatts of generating capacity this summer compared with a peak demand of 57600 megawatts on one 111-degree day last summer. ???Tindall said that after studying California's system the Texas grid made a concerted effort to operate theirs differently. For example she said Texas supports utilities entering into long-term contracts for power while in California power companies did not enter into such contracts and were forced to pay exorbitant prices at peak times. LOAD-DATE: April 30 2001 of 103 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????April 30 2001 Monday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 594 words HEADLINE: Developments in California's energy crisis BYLINE: By The Associated Press BODY: ??Developments in California's energy crisis: ??MONDAY: ??- Members of the Assembly Subcommittee on Natural Gas Costs and Availability unveil legislation to cut natural gas prices. ??- The state remains free of power alerts as electricity reserves stay above 7 percent. ??FRIDAY: ??-Gov. Gray Davis calls a federal regulatory order a Trojan horse that will profit power generators at California ratepayers' expense. The Federal Energy Regulatory Commission is considering requiring the state's electric grid operator to add a surcharge on power sales to pay generators the money they are owed by the state's two large financially strapped utilities. ??- State power buyers have asked for another $500 million to buy electricity for the customers of three cash-strapped utilities. That brings the total amount authorized for power purchases to $6.2 billion since mid-January when the state began purchases power for Pacific Gas and Electric Co. Southern California Edison and San Diego Gas and Electric. ??- Gov. Gray Davis says state office buildings cut energy use by an average of 20 percent in January and February saving taxpayers $286000 in utility bills. ??- State officials negotiating long-term power contracts for customers of three cash-strapped utilities have secured five more contracts. Four of the contracts signed in March by the Department of Water Resources will provide 466 megawatts of electricity during times of peak demand this summer according to DWR documents. One megawatt is roughly enough power for 750 homes. ??- California Public Utilities Commission attorneys are advising state agencies to avoid submitting monetary claims against Pacific Gas and Electric Co. despite the company's bankruptcy. The PUC is trying to retain their electric rate-setting authority over the utility and says submitting claims could bring the state under the court's jurisdiction as a creditor which could allow the judge to set electric rates. ??- Shares of Edison International closed at $9.90 up 15 cents. PG&E Corp. closed at $8.94 up 20 cents. ??-The state remains free of power alerts as reserves stay above 7 percent. ??WHAT'S NEXT: ??- Davis' representatives continue negotiating with Sempra the parent company of San Diego Gas and Electric Co. to buy the utility's transmission lines. Davis says he expects to have an agreement within two weeks. ??THE PROBLEM: ??High demand high wholesale energy costs transmission glitches and a tight supply worsened by scarce hydroelectric power in the Northwest and maintenance at aging California power plants are all factors in California's electricity crisis. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Electricity and natural gas suppliers scared off by the two companies' poor credit ratings are refusing to sell to them leading the state in January to start buying power for the utilities' nearly 9 million residential and business customers. The state is also buying power for a third investor-owned utility San Diego Gas & Electric which is in better financial shape than much larger Edison and PG&E but also struggling with high wholesale power costs. ??The Public Utilities Commission has raised rates as much as 46 percent to help finance the state's multibillion-dollar power buys. LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 Associated Press Online 29 2001 Sunday SECTION: Domestic non-Washington general news item LENGTH: 1313 words HEADLINE: ?Geothermal Plants Need More Steam BYLINE: JENNIFER COLEMAN DATELINE: MIDDLETOWN Calif. BODY: ???Geothermal plants in The Geysers area north of the Napa Valley have tapped steam fields to produce electricity since the 1960s. The 350-degree steam rushes more than 1500 feet up from the earth spinning turbines that create a constant flow of electricity. ??But mismanagement of the steam fields beneath the hilly northwestern California region that straddles the Sonoma and Lake county lines has led to a large decline of pressure and a drop of more than 50 percent in the amount of power the plants produce. ??The geothermal decline comes as California already faces short supplies of hydroelectricity from the drought-ridden Pacific Northwest and growing competition for megawatts from other power-starved states. ??State power grid managers estimate they're losing about 900 megawatts of geothermal electricity due to the gradual depletion of the steam fields. That's enough power for roughly 675000 homes. ??''They just overproduced. It is a renewable source of power but it's renewable over geologic time'' says Katherine Potter a spokeswoman for Calpine Energy which owns 19 of the 21 geothermal power plants in The Geysers region which incidentally has no geysers. ??The first electricity produced by tapping into pockets of steam trapped in the earth made its debut in 1904 in Larderello Italy. That plant rebuilt due to World War II damage is still operating. The first U.S. geothermal plant was a small operation at The Geysers built in 1962. ??Steam fields are created when water flows through fissures in the rock deep in the earth and is heated by hot magma. Geothermal plants tap into that pressure and use it to spin turbines. The plants' cooling towers release plumes of white steam which can be seen for miles on a clear day. ??While The Geysers is a unique geologic formation called a dry steam field there is the potential for thousands of megawatts of geothermal power from other regions that could use the more common ''wet steam'' process said Karl Gawell executive director of the Geothermal Energy Association in Washington D.C. ??Wet steam plants tap into superheated water in the earth separate the steam and use it to power generators. The water and the condensed steam is pumped back into the earth. ??CalEnergy Corp. owns 10 power plants in Imperial County that produce about 330 megawatts of power enough for about 247500 homes. Those plants and others like them haven't seen a decline in pressure like Calpine's plants. ??Geothermal energy is second only to hydroelectricity as a continuous cheap source of power said Jan Stewart Calpine's public relations manager. ??The plants in The Geysers reached their peak power production in the 1980s producing about 2000 megawatts of electricity enough to power about 1.5 million homes. ??At that time about 30 companies were involved in various geothermal ventures in the area and didn't work together Stewart said. ??''The resource wasn't being managed properly. As a result it was a very fractured environment'' she said. ''If one plant shut down the steam would be vented to the atmosphere instead of being rerouted to another plant where it could be used.'' ??In the 1960s and '70s when The Geysers got started there was ''a real wildcatter's mentality'' among power generators said Rich Ferguson energy chairman for Sierra Club California. ??''Basically they took out the water in the form of steam faster than Mother Nature was putting it back in'' he said. ??The available steam declined and the area now puts out about 850 megawatts sufficient power for roughly 637500 homes. ??Since then geothermal engineers have learned more about managing the resource Ferguson said. ??The superheated self-contained system at The Geysers has no ??ater running through it. ?''The Geysers is unique worldwide. There really aren't other dry steam fields'' Gawell said. ''In effect there was never a sustainable level of production you always would have depleted it eventually. It's like a giant pressure cooker. As soon as you put the first straw in you began to deplete the resource.'' ??Calpine is experimenting with replenishing the steam fields by pumping treated waste water back into the earth. It began three years ago when Lake County stopped pumping its treated waste water into Clear Lake. ??Now more than 8 million gallons of treated waste water is returned daily to the earth. The experiment appears to be working _ power output is up 68 megawatts. ??''People like the stewardship that Calpine provides now'' Ferguson said. '' Calpine has taken on as a long-term goal to make that sustainable.'' ??Calpine is building a 50-mile pipeline to Santa Rosa and plans to pump another 11 million of treated waste water daily from that city. The company expects that will boost production another 85 megawatts. ??Even with the new project power grid managers say they're planning for diminishing geothermal electricity. ??''We've lost a considerable portion of their output due to the decline in the output of the steam'' said Jim McIntosh director of grid operations for the Independent System Operator. ''All supplies are very important to us at this point.'' ??The plants are relatively low-maintenance once they're running _ only one engineer staffs each of the 19 Calpine plants in The Geysers. ??But geothermal plants are more expensive to build than natural gas-fired power plants Gaywell said. ??''It's like choosing between two identical cars one is $10000 and the other is $30000 but the $30000 car comes with a lifetime supply of fuel'' he said. ''People are shortsighted on investments and it takes more money upfront to build geothermal.'' ??Most geothermal resources are on public land lengthening the building process because more permits are needed Gawell said. ??Two new plants are in the application process in California. ??Researchers estimate there are 2500 megawatts of untapped geothermal resources in Nevada Gawell said. Idaho New Mexico and Oregon also have sites that could be tapped he said. ??''Many of these sites were looked at in the '80s but then nothing happened because in the '90s natural gas was too cheap to meter'' he said. ??Ferguson said the state spent $540 million over the last four years on incentives for renewable energy projects including geothermal solar wind and biomass and he expects the plan will be renewed when it expires in December. ??''We think there will be an equivalent amount of money'' he said. ''All the technologies have to compete against each other but geothermal should do pretty good.'' ??___ ??There are three types of geothermal power plants. Here's a look at how they work: ???Dry steam: Such plants are rare producing steam and not hot water. The Geysers region is the world's largest dry steam field. Steam from the earth is piped to the power plant where it spins turbines to create electricity. After the remaining steam condenses back to liquid it is returned to the earth. ???Wet steam: This type of geothermal plant is more common. There are several such plants in Southern California. Hot water and steam are brought to the surface separated and the steam is used to power turbines. The water is returned to the earth as is the condensed steam. ???Binary: These plants use hot water and steam from the earth to heat another liquid such as isobutane which has a lower boiling point than water. That liquid's steam is used to power turbines to make electricity. When the steam cools and becomes liquid it's returned to the tank and reused. This type of system is self-contained and has no emissions. ??___ ??On the Net: ??Geothermal Education Office: http://geothermal.marin.org ??California ISO: http://www.caiso.com ??Calpine Corp.: http://www.calpine.com ?????(PROFILE ?????(CO:Calpine Corp TS:CPN IG:ELC) ?????) LOAD-DATE: April 29 2001 of 103 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????April 29 2001 Sunday BC cycle SECTION: State and Regional LENGTH: 413 words HEADLINE: Guns in schools deregulation delay on lawmakers' agenda BYLINE: By BRAD CAIN Associated Press Writer DATELINE: SALEM Ore. BODY: ??Backers of a bill to prevent holders of concealed handgun licenses from bringing their weapons onto school property will spend the coming week trying to force a Senate vote on the issue. ??Also this week House Speaker Mark Simmons is planning to schedule a hearing on his bill to pull the plug - at least for now - on a key part of an electric deregulation law that's due to take effect this fall for large businesses. ??The guns-in-schools bill has been on life support for weeks with a key Senate committee chairman refusing to schedule a hearing on the bill on grounds that it is overly contentious and wouldn't pass anyway. ??The sponsor of the bill Sen. Ryan Deckert D-Beaverton and other supporters aren't giving up however. ??They are hoping to use a parliamentary maneuver that would enable them to move the school guns issue to the full Senate for debate by attaching it to another education-related bill. ??Gun owner groups say SB508 is unnecessary because there have been no documented cases of law-abiding carriers of concealed handguns causing any problems at schools. ??But a key supporter of the bill Sen. Ginny Burdick D-Portland says she is convinced the measure would pass in both the House and Senate - if it can be brought up for vote. ??I don't think we should wait to have dead children before we ban guns in schools said Burdick who was a chief sponsor of a measure passed by voters last fall expanding background checks at gun shows. ??California's power woes that were precipitated by that state's move to deregulation are giving Oregon lawmakers second thoughts about their decision to approve a phased-in deregulation of the electricity market in Oregon. ??A bill passed by the 1999 Legislature is supposed to open Oregon's electric markets to industrial and large commercial customers beginning this October. ??The 1999 law is supposed to free large businesses to buy power on the open market and does not deregulate electric rates for residential customers. ??Still Simmons says that drought conditions and the power market turmoil caused by California's energy crisis require reconsideration of the law. ??For that reason the House speaker is planning hearings this week on his proposal to enact a 15-month delay in Oregon's electricity restructuring efforts. ??This just gives the opportunity for the energy markets to settle for a while the Elgin Republican said. ??Similar legislation is pending in the Senate. LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 The Post Register Falls Post Register 29 2001 Sunday SECTION: News Pg. a1 LENGTH: 530 words HEADLINE: Plenty of blame to go around for West's power woes BYLINE: PAUL MENSER BODY: ??When it comes to power the West is a mess. ??Because of its botched deregulation attempts California bears a lot of the blame - but not all of it said Susan F. Tierney a former assistant secretary in the Energy Department now a consultant for Lexecon a Cambridge Mass. consulting firm. ??Like planets lining up to usher in an age of hysteria a combination of unforeseen circumstances have put the Northwest behind the eight ball. In addition to California's self-created tangle oil and natural gas prices are rising and a drought is stymieing the region's hydropower production. ??The situation is less volatile in other parts of the country. In the Northeast South and Midwest where growth has been modest and generating capacity has been more stable there's less discrepancy between supply and demand. ??Undergirding the West's situation was some serious lack of foresight Tierney said. ??When it looked like California power customers would be able to get electricity from whoever offered it at the cheapest price utilities worried about recovering the money they'd spent building plants and transmission lines in the '70s and early '80s. So they sold off their power plants and bought power on the wholesale market where it was cheap and plentiful. ??Not trusting the marketplace California legislators capped the rates utilities could charge residential customers. When wholesale power prices went up they couldn't pass those increases on to consumers. ??At the time they did not realize that in a couple of years there would not be an adequate power supply Tierney said. ??California's economic explosion of the late '90s coupled with a failure to build any new plants brought the crisis to a head. Computers are not by themselves big energy consumers but the factories that make them are. The Internet with all its server farms and data hotels also became a heavy power user. ??When demand in California finally caught up with supply all of a sudden utilities had to buy power and it became a seller's market Tierney said. ??But most of the Northwest's power comes from hydroelectric dams and there has to be water in the rivers to power the turbines at the dams. In a drought year like this the power has to come from somewhere else most likely oil- and natural gas-fired plants which fire up when demand is high. ??Because demand is so high this year generators can charge exorbitant prices knowing that California and the Northwest have nowhere else to buy power. ??Also natural gas prices have gone through the roof in the last 18 months and aren't likely to come down until next year at the earliest. Until 18 months ago the price of natural gas had been at a prolonged low so companies weren't interested in expensive drilling projects. ??The problem is not likely to be permanent. As exploration and extraction pick up prices will come down. The public has already begun to hear a conservation message and the Federal Energy Regulatory Commission is being deluged with applications for new power plant construction. ??Staff writer Paul Menser can be reached at 542-6752 or via e-mail at pmenser@idahonews.com. LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 29 2001 Sunday Home Edition SECTION: Opinion Part M Page 6 Opinion Desk LENGTH: 1312 words HEADLINE: THE STATE HOW KILOWATT SOCIALISM SAVED L.A. FROM THE ENERGY CRISIS BYLINE: JEFF STANSBURY Jeff Stansbury is a PhD candidate in American history at UCLA. His dissertation is on the role of the labor movement in the building of L.A.'s infrastructure BODY: ??Why is Los Angeles an island of tranquillity in the electric-power crisis that has rocked California and threatens to spread across the nation? ??News stories have repeatedly told us that the city's ownership and operation of its own generating stations is the principal reason. By staying clear of the state's 1996 deregulation scheme for private utilities the Department of Water and Power was able to hold onto its power plants. ??So far so good. But when we ask how Los Angeles came to enjoy public power in the first place the answer commonly given makes a hash of history. ??Most historians and political scientists credit the city's progressive reform movement of 1890-1915 for having wisely settled on a municipal utility. True some of the entrepreneurs lawyers and reform-minded professionals who called themselves the best men during that era agitated for the city-built Owens Valley aqueduct and its generating stations. But many reformers opposed the city's effort to distribute its own power. Because they had allied themselves with railway magnate Henry Huntington who owned an electric company or because they favored regulation over municipal ownership they wanted L.A.'s three private electric companies to sell and profit from aqueduct power. Meyer Lissner a reform attorney often portrayed as a champion of public power opposed the holding of a decisive 1911 citywide straw poll on the subject because he knew most Angelenos would cast their ballots for municipal ownership. That he said would be unfair to the three utilities. ??The most steadfast partisans of public power were not progressive reformers like Lissner but the city's much-maligned labor unions and for a simple reason. While mistrust of oligopoly ran through nearly all sectors of society it burned hottest in working-class wards. Without organized labor's dogged campaign for gas and water socialism as well as its willingness to hand control of these resources to the anti-union regimes of Mayors George Alexander and Henry Rose there would be no DWP today. ??Organized labor played a key role in the city's original decision to municipalize its water distribution system. On Oct. 24 1892 700 union members met to demand that the city build a small neighborhood waterworks as a step toward public control of the entire water supply. From that day on L.A.'s unions never wavered in their call for a public water supply publicly managed. They mobilized the rank and file for the water-company buyouts of 1901-04 and in 1906 the Public Ownership Party's citywide campaign primed voters to pour $ 23 million into construction of the Owens River aqueduct a year later. The aqueduct was the sine qua non of public power. At a time when most progressive reformers were mute on the subject organized labor insisted that the aqueduct be used to generate electricity for the city's streets homes and businesses. ??A broad consensus backed the city's construction of hydroelectric plants while the aqueduct was being built but most of the city's politicians and corporate lobbyists were committed to public subsidies not public ownership of aqueduct power. The 1911 straw poll in which city voters declared their support for municipal ownership and distribution of Owens River power upset their plans. ??The most consistent fighters for public power during the decades after the straw poll were the Central Labor Council International Brotherhood of Electrical Workers other unions and city employees who stuffed campaign envelopes canvassed precincts and got out the vote. Voters who favored municipally owned power and initiatives bolstering the DWP tended to be working class and Democratic those opposed were mainly middle and upper class and Republican. ??In this polarized political climate Mayor Alexander called for a $ 6.5-million bond issue to complete the aqueduct-power distribution network he left open the question of who would sell the power to consumers. Unions and socialists tied their support for the bonds to a city charter reform that would guarantee them a long-sought role in city government through proportional representation. When the reform failed at the polls they withheld support from the power bonds and these too went down to defeat in 1913. Much of the rancor workers felt was aimed at progressives like Lissner head of the Good Government Organization who fought labor's charter plank because it would bring socialists onto the City Council. ??The labor movement's dedication to public ownership soon reasserted itself however. With a citywide election coming up that June five unionists seeking council seats on the Socialist Party ticket revived labor's long-standing demand for city operation of all public utilities at cost. They urged the City Council to hold a new power-bond election with a clear public ownership mandate. They attacked the power companies' efforts to buy aqueduct power from the city and sell it to Angelenos at a profit. Soon the great majority of unions in the Central Labor Council were locked in what turned out to be a decisive struggle against the power oligopoly made up of Southern California Edison Pacific Light & Power and Los Angeles Gas & Electric. ??An unprecedented event brightened the bonds' chances. A machinist Fred C. Wheeler won a seat on the City Council the first unionist to do so in the 20th century. Wheeler led a successful fight against an attempt to split the power-bond issue into two separate ballot propositions one to complete the aqueduct's generating stations the other to create a city-owned distribution system. Such a division would probably have doomed public power. ??The large majority of unionists who favored public power had little time to savor Wheeler's victory. While pressing the attack on the three electric companies they faced a small but angry split in their own ranks. Dissenters in the Building Trades Council and a few of its unions argued that labor's grievances against the progressive regimes of 1909-14 had turned the argument for municipal ownership on its head. What good was municipal ownership in the hands of a council and mayor who had caused the arrest of hundreds of peaceful picketers during the citywide strikes of 1910 had underpaid aqueduct workers and fed them bad food and had denied unionists influential city jobs? The final blow was the council's rebuff of a petition signed by thousands of workers for a living wage law. Was it not folly to reward labor's foes with control of the aqueduct's power? ??Union activists who favored the bonds conceded that the dissenters were correct in their assessment of progressive city government. But the progressive star was fading. What counted in the long run was whether Los Angeles could wrest the city's electric power system from the grasp of private utilities. The Central Labor Council's unions took this challenge to heart and voted 60-4 for a resolution favoring the bonds. ??On its own as well as in coalition with other groups the labor movement marshaled its rank and file on behalf of public power. It turned out hundreds of poll-watchers and canvassers on election day. The pro-bond unions never did win over the dissenting faction rather they overwhelmed it at the polls. On May 8 1914 L.A.'s voters emphatically endorsed the power bonds by a hefty 71%-29% with the city's working-class wards providing by far the largest margin of victory. ??Within a year Los Angeles sold its bonds and began buying out the three investor-owned utilities. The first public power flowed into local homes and businesses in 1916. Two decades later the DWP eliminated the last of its private competition and consolidated the working-class legacy of kilowatt and water socialism that has served the city so well in the current energy crisis. GRAPHIC: GRAPHIC-DRAWING: (no caption) JENNIFER HEWITSON / For The Times LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 29 2001 Sunday Home Edition SECTION: Opinion Part M Page 4 Editorial Writers Desk LENGTH: 558 words HEADLINE: CONSERVATION SANDBAGS THE DAVIS ADMINISTRATION NEEDS TO LAUNCH A CRASH EDUCATION COURSE TO CONVINCE CALIFORNIANS OF THE SERIOUSNESS OF THE ELECTRICITY CRISIS AND THE NEED FOR FAR-REACHING ENERGY-SAVING MEASURES. BODY: ??Natural disasters and crises can be devastating but are relatively simple and easy to grasp. A brush fire you fight with shovels. An earthquake you clean up the rubble afterward and strengthen buildings in anticipation of the next. But California's energy crisis is far different and more complex. It's a quiet disaster on scattered invisible fronts. Most people see it only when their own lights go out. ??There also is no precedent for this crisis in California and no accurate way to forecast how bad it can get either the blackouts or the financial consequences. But as May approaches it's certain that most Californians are not adequately informed about the severity of the problem or what they can do to limit its impact. ??Gov. Gray Davis the utilities and others need to engage in a crash education program that will convince Californians of the seriousness of the problem and motivate them to undertake their own conservation programs in homes and businesses. California has been a pioneer in power conservation and its citizens will listen to persuasive reasoning. ??As the chairwoman of the state Senate's Energy Committee Sen. Debra Bowen (D-Marina del Rey) deals with problems ranging from utility company insolvency to rate gaming by energy producers. But I'm really worried about this summer she said last week referring to the potential for day after day of rolling blackouts. She told of one businessman in her district who reported he will lose an estimated $ 30000 every time his power is cut. Why not at least schedule blackouts so people can plan for them? she asked. Why not? ??In San Francisco the Bay Area Economic Forum released a study indicating that power woes could deliver a $ 17-billion blow to the state's economy in lost production the cost of rate increases and increased product prices. That may be conservative. The study did not include the $ 5.1 billion the state has spent so far to buy power for the insolvent private utilities. ??Republicans in the Legislature are stalling bills that would float a $ 10-billion revenue bond issue to finance power purchases and keep the state fiscally above water. They have latched onto a powerful issue Davis' unwillingness to detail how he's spending the taxpayers' billions. Davis says he needs secrecy for competitive reasons as he bargains with power companies though he is letting out a slightly wider trickle of figures. ??Wall Street already wary about the credit-worthiness of the state thinks poorly of the delay in issuing the bonds. Republicans should put a temporary hold on their battle with Davis and get the measure to the governor's desk this week. ??Lawmakers were slow in passing an $ 850-million conservation program Bowen acknowledges. But Davis put the new program on a fast track Friday and made a smart choice in S. David Freeman former chief of the Los Angeles Department of Water and Power to run the conservation effort. ??Freeman 75 is a canny veteran of electric power politics. Davis may abhor giving out bad news but Freeman need not shrink from it. Freeman should be on radio and television every day telling California just how bad the problem is and what they can do about it. If this were a flood we'd be stacking sandbags. Our sandbags are conservation programs. We need to start stacking them now. LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 29 2001 Sunday Home Edition SECTION: Part A Part 1 Page 27 National Desk LENGTH: 1316 words HEADLINE: BUSH: THE FIRST 100 DAYS BUSH IS OFF TO A ROCKY START IN HIS HANDLING OF ALL THINGS CALIFORNIAN POLITICS: BUT WHY WOO THE GOLDEN STATE WHEN HE CAN'T CARRY IT IN AN ELECTION 'NO MATTER HOW HARD HE TRIES' ONE ANALYST POINTS OUT. BYLINE: RICHARD SIMON TIMES STAFF WRITER DATELINE: WASHINGTON BODY: ??So what if President Bush has opposed electricity price controls sought by California officials? Or that he has proposed cutting aid to states for incarcerating illegal immigrants convicted of crimes? Or that he has visited 26 states in his first 100 days in office--but not the most populous? ??Bush really does care about California the White House insists even if the state preferred Al Gore on election day. Administration officials said they have done a lot and plan to do more to lessen the electricity turmoil expected this summer. ??I don't think he's treated California any differently than any other state said Rep. George P. Radanovich (R-Mariposa). ??Some Californians feel otherwise. ??The Bush administration's treatment of California started at indifference moved to neglect and has now reached actual harm complained Phil Schiliro chief of staff for Rep. Henry A. Waxman (D-Los Angeles). ??Sen. Dianne Feinstein (D-Calif.) has asked three times for a meeting with Bush to discuss the energy crisis. Her response from the White House: a form letter with her name misspelled. ??Bush has called for requiring public agencies to buy costly earthquake insurance a measure opposed by California lawmakers of both parties. He has proposed cutting an earthquake preparedness program. And he provided no money in his proposed budget to clean up a pile of uranium processing waste in Utah leaking into the Colorado River. ??That's our water supply political analyst Sherry Bebitch Jeffe said. What kind of message is that? ??John J. Pitney Jr. associate professor of government at Claremont McKenna College said Bush's apparent indifference makes political sense. ??It's hard to argue that Bush should spend any political capital in California he said. The 2000 election suggested that he cannot carry the state no matter how hard he tries. The Republicans have already lost several House seats and have probably hit rock bottom. . . . From a purely political angle there's little point in giving California any money or attention that could otherwise go to more competitive states such as Florida. ??But Jeffe senior scholar at USC's School of Policy Planning and Development said Bush's failure to visit the state is hurting GOP efforts to rebuild itself in California. We are ground zero for the kind of Latino outreach that he said he wanted to do. ??And veteran California Republican political strategist Kenneth L. Khachigian said Bush at least needs to prepare for the electricity problems predicted for summer. ??If you get three or four days of successive blackouts air conditioners going out traffic lights going out a second bankruptcy--whether he wants it or not--it's his problem Khachigian said. It would be wise for him to have a proactive stance not just reactive. ??Tough Act to Follow ??Some political analysts have suggested that if Bush becomes too involved in California's troubles what is now Democratic Gov. Gray Davis' problem could become Bush's. But Khachigian said there's a fine line between taking responsibility for a problem and claiming that California isn't part of the United States. ??In dealing with heavily Democratic California Bush has made this much clear: He is no Bill Clinton. ??Bush has a hard act to follow. When Clinton was president he visited California often and rewarded it with federal largess. And California in return showered him with buckets of campaign dollars and electoral votes. ??But Rep. Ed Royce (R-Fullerton) said California will benefit from Bush's presidency too. As Californians bear a disproportionately higher tax burden they stand to benefit greatly from the president's tax relief plan. ??While House spokeswoman Claire Buchan assured that Bush will visit California soon. His wife already has done so. ??As proof that California is on their mind administration officials point to the three Californians in the Cabinet--Ann M. Veneman of Agriculture Norman Y. Mineta of Transportation and Anthony J. Principi of Veterans Affairs--and others in top White House jobs. ??Bush also has appointed California Latinos to high-level posts: Huntington Park Councilwoman Rosario Marin as treasurer Los Angeles entrepreneur Hector V. Barreto Jr. as head of the Small Business Administration and former San Mateo County Supervisor Ruben Barrales as deputy assistant for intergovernmental affairs. ??Critics said that a Californian at the top does not guarantee that the Cabinet departments will develop California-friendly policies. The proposed Agriculture budget for example provides only $ 5 million--not the $ 15 million that California lawmakers said they need--to fight the glassy winged sharpshooter an agricultural pest that threatens the state's wine industry. ??A spokesman for Veneman assured that additional funding will be considered if requested by California lawmakers. And Rep. Mike Thompson (D-St. Helena) who assailed Bush for missing opportunities to help California nonetheless expressed confidence in Veneman. She's going to keep pounding away to make sure that the California wine industry gets what it needs. ??Some Good News ??Though he has proposed cuts in some programs that are important to California Bush has taken some actions that please state officials. He has proposed a permanent research and development tax credit--an action that would particularly benefit Silicon Valley. ??His proposed budget includes additional money to crack down on illegal immigration and drug smuggling and unsafe trucks crossing into California from Mexico. And he has proposed increased funding to reduce backlogs at immigration offices. ??In one area Bush even bested Clinton. He proposed $ 14 million to clean Lake Tahoe more than the $ 3 million recommended by Clinton last year. ??And although he has drawn flak for proposing cuts in programs to promote energy efficiency and alternative fuels his proposal to boost assistance to low-income families for insulating their homes and reducing their utility bills would nearly double California's allocation to $ 8 million next year. ??No Bush policy has been more criticized in California than his approach to the state's energy woes--particularly his adamant opposition to price controls. Steve Maviglio a spokesman for Davis said Bush and his aides got off to a strong start by extending federal orders sought by the state to keep power flowing into California. ??Since then . . . they've been AWOL Maviglio said. In a reference to price controls he added: They're skirting around the edges of the problem without taking the bold action they need to take. ??The feds are the only ones who can step in and bring some sanity to the cost of electricity in California Thompson said. ??Administration officials said they have taken steps from our first hours in office to address the energy crisis. They said they have responded favorably to all the state's requests except price controls which Bush contends would discourage the building of power plants. ??While some seek to portray Bush's opposition to price controls as unsympathetic to California's plight a number of California's House Republicans also oppose price controls. And even those who support them argue that the issue misses the larger point. ??Rep. Randy Duke Cunningham (R-San Diego) an advocate of price controls nevertheless said: I agree with the administration that the state alone remains responsible for solving this crisis. ??Added Rep. Mary Bono (R-Palm Springs): I don't believe Bush should bear the brunt of responsibility that the Clinton administration left over. ??Tim Ransdell executive director of the California Institute for Federal Policy Research doubted that Bush would ignore California. California represents one-eighth of the nation. One in eight Americans can't be ignored. LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 29 2001 Sunday Home Edition SECTION: Business Part C Page 2 Financial Desk LENGTH: 1290 words HEADLINE: WEEK IN REVIEW TOP 10 STORIES / APRIL 23-27 BYLINE: Lisa Girion and Terril Yue Jones and Sallie Hofmeister and James Bates and Peter Pae and Jeff Leeds and Nancy Rivera Brooks and Peter Gosselin BODY: ??1. Economic Growth a Welcome Surprise: The U.S. economy grew at an unexpectedly strong 2% annual rate in the first three months of the year thanks largely to buoyant shopping by American consumers. The gross domestic product--the country's total output of goods and services--expanded at twice the pace it did in the final three months of 2000 and at twice what analysts had expected the government said Friday. Although many analysts said the economy remains balanced between strong growth and recession economic optimists exulted over the report. Fed Chairman Alan Greenspan added to the celebratory mood by saying that a key trend behind the economy's strong performance of the last decade--its ability to improve productivity--is likely to resume despite the current slowdown. ??(Peter Gosselin) ??* ??2. Stocks Rise on Good News: The GDP report boosted stock prices which already had gotten a lift from better-than-expected home sales figures earlier in the week. The Dow Jones industrial average rose 117.70 to close at 10810.05 on Friday up 2.2% for the week while the S&P 500 index climbed 18.53 to 1253.05. The Nasdaq which had fallen Thursday on concerns over weak technology profits rose 40.80 to 2075.68 finishing the week down 4.1%. Meanwhile the yield on the benchmark 10-year Treasury note rose to 5.33% from 5.19%. ??(Times Staff Writer) ??* ??3. Power Crisis Zaps State Bond Rating Price Controls OKd: The mounting cost to the state general fund of buying electricity for California consumers prompted Standard & Poor's Corp. to downgrade $ 25 billion of California's general obligation bonds. S&P lowered California's bond rating by two notches to A-plus from AA. The move could add hundreds of millions of dollars to the state's borrowing costs bond experts said. Separately federal regulators approved a plan to control electricity prices in California during times of supply shortages. The Federal Energy Regulatory Commission tied prices during power emergencies to the cost of natural gas and emission controls among other things with the least efficient generator setting the market price. Critics said the order contains loopholes that will allow market manipulation. ??(Nancy Rivera Brooks) ??* ??4. FTC Pans Music Industry Marketing: A much-anticipated sequel to last year's Federal Trade Commission report on the marketing of violent entertainment to children slammed the record industry for failing to heed regulators' recommendations. Though it gave some credit to the film and video-game industries for revising the way they marketed to young audiences the FTC found the five major record conglomerates continued to advertise explicit-content albums on popular teen shows such as MTV's Total Request Live and BET's Top 10 Live. Just before the release of the first report the Recording Industry Assn. of America had blunted some of the criticism by introducing a policy against ads for such albums on TV shows or in publications whose audience is mostly 16 years old or younger. But the RIAA said it rescinded the policy in September. ??(Jeff Leeds) ??* ??5. Gas Prices Continue Upward Spiral: The average price of self-serve regular gasoline spurted higher again in California and around the nation on an increase in demand and a switch by refiners to the more costly summer gasoline blend required in parts of the country by air-quality regulations. Prices in California got an extra boost from a fire at a Los Angeles-area refinery owned by Tosco Corp. and by a change in Tosco's pricing strategy. In late March Tosco increased wholesale prices to its dealers in Southern California and Arizona and tied prices to the cost of gasoline in the spot market. Some other major suppliers have begun matching the Tosco increase market experts said. Some market watchers foresee gas at $ 3 a gallon or more. ??(Nancy Rivera Brooks) ??* ??6. General Dynamics Renews Newport News Bid: General Dynamics Corp. agreed to acquire Newport News Shipbuilding Inc. in a $ 2.1-billion deal that would create the nation's largest military shipbuilder and leave only one maker of U.S. aircraft carriers and submarines. The proposed merger which the Pentagon had rejected two years ago marks the latest in a renewed wave of consolidations in the defense industry and would again make General Dynamics one of the largest private employers in San Diego. General Dynamics executives said they are confident of receiving the necessary approvals because this time they will be dealing with the Bush administration which may view the takeover differently. ??(Peter Pae) ??* ??7. Disney Earnings Beat Estimates: Walt Disney Co.'s second-quarter operating results exceeded Wall Street's expectations as the company's studio and consumer products units improved although Disney did post a net loss stemming largely from a one-time charge related to the restructuring of its Internet portal. Disney also confirmed that it will shrink its venerable animation unit with a union official estimating as many as 300 jobs of about 1000 in Burbank could be cut. Separately President Robert Iger confirmed that layoffs will be needed to reach Disney's previously announced goal of cutting 4000 jobs companywide. Disney's studio and consumer products groups showed improved results in the quarter while earnings were flat in its theme parks and softer in broadcasting. ??(James Bates) ??* ??8. New FCC Chief Vows Deregulation: Repudiating decades-old media ownership rules Federal Communications Commission Chairman Michael K. Powell said he envisions a broad rollback of restrictions which could bring about a tidal wave of consolidation. In his most candid remarks about the role of the FCC since taking office Powell said he would move in early May to eliminate regulations that prevent one company from owning a newspaper and a television station in the same city. Powell also told broadcasters meeting in Las Vegas that Viacom Inc. was likely to prevail in its challenge of federal rules that prevent any broadcaster from owning stations that reach more than 35% of the nation's television viewers. ??(Sallie Hofmeister) ??* ??9. Ford Takes More Heat Over Explorer Tires: Ford Motor Co. came under the most direct criticism leveled against it yet regarding last year's massive Firestone tire recall. Two prominent consumer safety groups issued a report saying that the auto maker was largely to blame for accidents in which Ford Explorer sport-utility vehicles equipped with Firestone tires spun out of control after the tires lost their treads. Though they blamed Bridgestone/Firestone for producing tires prone to failure Public Citizen and Safetyforum.com said Ford bore the bulk of the responsibility for dictating an insufficiently robust tire design and designing the Explorer so it would overly stress the tires and tip over too easily once a tire blew. ??(Terril Yue Jones) ??* ??10. American Airlines Sued Over Health Coverage: A flight attendant filed a complaint with the Equal Employment Opportunity Commission in Los Angeles charging that American Airlines discriminated against some employees by refusing to offer insurance coverage for birth control Pap tests and infertility treatments. The case could test the position the EEOC took in December that the federal Pregnancy Discrimination Act forbids employers from excluding contraceptives from prescription drug plans. ??(Lisa Girion) ??* ??These and additional stories from last week are available at divided by category. Click on Money and Investing Entertainment Business and other topics. ??* Please see Monday's Business section for a preview of the week's events. GRAPHIC: PHOTO: Though Disney's second-quarter profit beat Wall Street predictions its theme-park earnings were flat. ?PHOTOGRAPHER: Associated Press LOAD-DATE: April 29 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 The New York Times Company New York Times ?????????????????April 29 2001 Sunday Late Edition - Final SECTION: Section 4 Page 17 Column 1 Editorial Desk LENGTH: 756 words HEADLINE: Reckonings The Real Wolf BYLINE: ?By PAUL KRUGMAN BODY: ??Recently I received a letter from an economist I respect chiding me for my Naderite columns on the California energy crisis. He just didn't believe that market manipulation by power companies could possibly be an important issue it sounded too much to him like the sort of thing one hears from knee-jerk leftists who blame greedy capitalists for every problem be it third-world poverty or high apartment rents. The left has cried Wolf! so many times that sensible people have learned to discount such claims. ??But now a bona fide wolf has arrived whose predatory behavior is doing terrible damage to our most populous state -- and nobody will believe it. ???True California would be heading for a summer of power shortages even if it had never deregulated. And even if there was workable competition in the wholesale electricity market prices in that market would spike during periods of peak demand transferring billions of dollars from either taxpayers or consumers to the generators. ??But the evidence is now overwhelming that there isn't workable competition in California's power market and that the actions of generators gaming the system have greatly magnified the crisis. The key fact is that California has somehow remained in a state of more or less continuous power shortage and very high wholesale prices regardless of the level of demand. A rash of outages has kept the electricity market conveniently -- and very profitably -- short of supply even during periods of low demand when there ought to be lots of excess capacity. ??As Frank Wolak the Stanford economist who also advises the state's power grid has pointed out an outage at a power plant is a lot like an employee calling in sick. You can't tell directly whether he is really sick or has chosen to take the day off for other reasons but you can look for circumstantial evidence. And such evidence has convinced Mr. Wolak that generators use forced outages strategically to withhold capacity from the market -- a view shared by a growing number of other researchers. ??Which brings us to the latest move by the Federal Energy Regulatory Commission. On Wednesday the commission apparently decided to offer California some relief and put new price caps in place on the California electricity market. I say apparently because the more you look at the plan the less likely it seems to be any help at all. Indeed the measure was passed on a 2-to-1 vote with William Massey -- the one commissioner who has been sympathetic to calls for price controls -- voting against it on the grounds that it would be ineffectual. ??What's wrong with FERC's plan? First it caps prices only in emergency conditions -- ignoring the fact that electricity prices have stayed at hard-to-explain levels even when there is no emergency. In effect the plan is laid out as if the electricity market were really competitive in spite of all the evidence that it is not. ??Second even those emergency price caps are full of loopholes offering extensive opportunities for what Mr. Wolak calls megawatt laundering -- selling power to affiliated companies that for one reason or another are exempted from the price controls (for example the controls do not apply to imports from neighboring states) then selling it back into the California market. Severin Borenstein of the University of California Energy Institute adds that because the allowed price depends on the cost of generation at the least efficient plant generators will have a clear incentive to produce inefficiently: I predict we will find some plants we never heard of before that are suddenly operating again and they will be pretty inefficient. ??The general verdict seems to be that this is not a serious plan. There are serious proposals to mitigate the crisis out there -- indeed last fall Mr. Wolak submitted a proposal that was well received by other experts -- but FERC has ignored all of them. ??The charitable interpretation is that FERC still doesn't get it that it just can't bring itself to believe that this time the wolf is real. The uncharitable interpretation is that last week's action was meant to fail. The Medley Report an online newsletter calls the FERC plan a grand exercise in posturing without substance . . . a very clever temporary move by the Bush administration to deflect any political fallout from the looming disaster. ??Whatever the explanation the plain fact is that FERC and the administration have yet to offer California any significant relief. ??http://www.nytimes.com LOAD-DATE: April 29 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 McClatchy Newspapers Inc. Bee ??????????????????April 29 2001 Sunday METRO FINAL EDITION SECTION: MAIN NEWS Pg. A1 POWER CRUNCH LENGTH: 1323 words HEADLINE: Diesel plants spark concern They're expected to generate big air-quality problems when predicted summer blackouts hit. BYLINE: Chris Bowman and Stuart Leavenworth Bee Staff Writers BODY: ??When blackouts roll across California in the coming months - as captains of the crippled electricity grid say they surely will - tens of thousands of miniature powerhouses will whine cough and rumble to the rescue. ??These backup plants will ignite the same fuel that powers locomotives ships and 18-wheel trucks. And they'll be spewing the same pollution - only more so because most are old with little or no emissions controls. ??They are diesel-powered generators the dirtiest of internal combustion engines. And unlike trucks and other vehicles they've largely escaped 30 years of air pollution restrictions because they were intended only for emergencies as when a storm or earthquake knocks out power. ??But now as a season of multiple planned blackouts appears imminent many California businesses are expected to fire up the old stogies more often than was ever imagined. ??And the generators will kick in when their expelled gases can do the most harm. The hot weather that taxes air conditioners and drains electricity supplies also accelerates the conversion of engine exhaust to ozone gas the ingredient in smog that inflames airways and impairs breathing. ??That is why we think this is going to be the most challenging summer ever for air quality said Luna Salaver spokeswoman for the Bay Area Air Quality Management District a nine-county region with thousands of unregulated standby generators. ??On those hot days when we want people to stop driving and doing things that pollute the air the generators will kick in and air quality will worsen Salaver said. ??No one knows how many diesel generators are scattered around the state at hospitals universities factories and businesses. But air districts report there are at least 641 in Sacramento up to 5000 in the Bay Area 1200 in the San Joaquin Valley and thousands more in the smog-plagued valleys of Southern California. ??Some are relatively clean particularly if they have been built or retrofitted in the last few years. But most are tiny pollution factories and were intended only to be run for short periods following natural disasters. ??According to the state Air Resources Board a typical diesel generator emits about 50 to 100 times more smog-forming compounds per unit of energy than a typical gas-fired power plant. When the plants run for hours people downwind can get a heavy dose of the tiny toxic particles contained in diesel exhaust. ??Go down to the Greyhound bus station and have them turn on their engines and hang around there - that's what it's like said Michael Scheible deputy executive officer of the state Air Resources Board which regulates engines and fuels. ??Environmentalists say generators should be cranked up only during power outages. But in recent months farmers and manufacturers have pressured regulators to redefine an emergency and allow generators to be used well before a blackout is ordered. ??Business groups say regulators need to be sensitive to data centers chip makers and other manufacturers that can't afford even a one-second interruption in power. ??We would like some kind of statewide policy on when and where we can use the diesel generators said Gino DiCaro a spokesman for the California Manufacturers and Technology Association. Obviously we would like to use them more than we can now. ??We need to basically let go of this air-quality issue said Mike Jennings a Fresno energy consultant whose clients include members of the food-processing and dairy industries. ??State air and energy regulators are pushing energy conservation as the best way to avoid power outages. Nonetheless the California Energy Commission has been compiling a list of generators statewide to see how their use could be coordinated a move that stirs hope from business groups. ??Six months ago nobody wanted to talk about this because diesel was a big bad word DiCaro said. Now at least we have agencies like the Energy Commission and the Public Utilities Commission talking about how diesel generators can fit into our electrically unreliable world. ??Environmentalists worry that as the summer drags on Gov. Gray Davis will allow unrestricted use of the diesels. ??So far the governor's staff has held firm said Gail Ruderman Feuer an attorney with the Natural Resources Defense Council a national environmental group. But if blackouts start happening in a big way they could change their tune. ??Along with other forecasters officials with the California Independent System Operator manager of the state's electricity grid expect a flurry of blackouts in coming months. The next two months could be critical because most new power plants under construction won't go on line before July. In addition California will be losing one of its largest generators of electricity today when one of two units at the Diablo Canyon nuclear power plant is taken off-line for 35 days of scheduled refueling. ??You should be ready for the worst-case scenario said Del Evans Pacific Gas and Electric Co.'s head of power load management at a media briefing last week. ??For sellers and makers of diesel generators the gloomy predictions are a gold mine. Small businesses farmers manufacturers - all are rushing to buy generators before the blackouts hit. ??We are busier than we have ever been said Rob Bly president of Tuban Industrial Products Co. which assembles about 300 generators a year at its plant in Sacramento. We are twice as busy as we were in the height of the Y2K madness. ??Bly says the generators he makes are 10 times cleaner than ones of a decade ago. Still he acknowledges diesel is diesel. ??If you are a hospital and you want standby power you can't use propane. The fire marshall won't let you said Bly. That leaves you with just one thing and that is diesel. ??Responding to such concerns state Sen. Rico Oller R-Andreas introduced a bill this year to exempt thousands of backup generators from pollution controls whenever any power alert is called. The bill however was blocked by a Senate committee and environmentalists say air districts have already relaxed their rules enough. ??One of the big concerns is the cancer risk Ruderman Feuer said. Air board studies she noted have found that a person's lifetime cancer risk increases 50 percent if he or she lives near a big diesel generator that runs 250 hours a year. ??In January the U.S. Environmental Protection Agency allowed air districts to loosen their restrictions on generators. In turn the South Coast Air Quality Management District extended the number of hours that diesel generators could be operated each year. The San Joaquin Valley Air Pollution Control District went even further allowing businesses to run generators when state power reserves drop to 1.5 percent or when the ISO predicts blackouts anywhere in the Valley. ??The Sacramento Metropolitan Air Quality Management District still requires businesses and public agencies to wait for blackouts before generators are fired up. Altogether the district has permits for 641 generators including major clusters at data centers and companies such as Intel. ??In the Bay Area regulators are even more uncertain of what could happen this summer. Unlike other regions of the state the Bay Area never required permits for diesel generators smaller than 250 horsepower. (In Sacramento the threshold is 50 horsepower.) ??As a result only 12 of the region's estimated 5000 generators are subject to pollution controls. ??Salaver the district's spokeswoman said officials assumed the generators would be used only during earthquakes and therefore didn't need any regulation. ??Now we find people are operating generators even if we are in a Stage Two alert Salaver said. That is not what emergency generators are for. ??* * * ??The Bee's Chris Bowman can be reached at (916) 321-1069 or cbowman@sacbee.com. GRAPHIC: Sacramento Bee / Jay Mather Mark Karakas checks a newly assembled diesel generator at Tuban Industrial Products in Sacramento. Sacramento Bee / Sheldon Carpenter Lights out generators on Diesel-powered generators can save lives during emergencies but they spew far more pollution per unit of energy than other power sources and could significantly degrade air quality during the blackouts expected in the next six months. Smog-forming compounds Power source / Pounds of nitrogen oxides per megawatt-hour of electricity Existing diesel generator / 25 to 30 Diesel generator wiht latest pollution controls / 7 Uncontrolled gas-fired power plant / 2 to 4 Controlled older gas-fired power plant / 0.1-0.15 New combined cycle gas-fired power plant / 0.05 Cancer causing particulates (PM) Power source / Pounds of PM per megawatt-hour of electricity Existing diesel generator / 1 to 3 Diesel generator wiht latest pollution controls / 0.1 to 0.5 Gas-fired power plant / 0.03 to 0.07 Snapshot of generators Number of emergency diesel generators in selected air districst: Bay Area Air quality Management District Generators: 3000 to 5000 Sacramento Metropolitan Air Quality Management District Generators: 641 San Joaquin Valley Air Pollution Control District Generators: 1200 South Coast Air Quality Management District Generators: 5000 Sources: California Air Resources Board regional air quality districts LOAD-DATE: April 30 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 McClatchy Newspapers Inc. Bee ??????????????????April 29 2001 Sunday METRO FINAL EDITION SECTION: MAIN NEWS Pg. A1 LENGTH: 1544 words HEADLINE: Why Edison PG&E split on strategy BYLINE: Dale Kasler Bee Staff Writer BODY: ??One utility was more entrepreneurial accustomed to the rough-and-tumble of free markets - and apparently believed only a radical remedy would cure its ills. ??The other was a more political animal conversant with the language of Sacramento - and confident that negotiations and compromise with state officials could fix its problems. ??Different cultures and different circumstances sent Southern California Edison and Pacific Gas and Electric Co. on separate paths this month. Edison run by a former president of the Public Utilities Commission negotiated a rescue package with Gov. Gray Davis. PG&E with fewer ties to government and possessed of an independent streak walked away from Davis and straight into U.S. Bankruptcy Court. ??As California's energy crisis hurtles toward a summer of blackouts and higher rates experts are debating which company found the best solution for digging its way out of billions in debt. ??We now have two models it'll be interesting to see who recovers the quickest said Mitch Wilk a former PUC president who is now an energy consultant in San Francisco. ??At first blush Edison and PG&E had plenty in common. Both utilities were afflicted with the same problem: runaway wholesale electricity costs they weren't able to recover from customers because of a state-mandated rate freeze. Both had been teetering on the edge of bankruptcy since January when their losses depleted their cash reserves and credit. ??But PG&E was far sicker financially than Edison. Its debts from the state's flawed deregulation scheme reached $6.6 billion vs. $3.5 billion for Edison. That's because Edison serves a smaller territory and has more long-term supply contracts so it was buying far less electricity than PG&E on the horrendously expensive spot market. ??Faced with a comparatively manageable loss Edison was receptive to selling its share of California's transmission grid to the state a deal that would generate $2.76 billion. The proceeds along with funds from a proposed long-term bond sale would pay off Edison's debts according to the terms of the deal. ??Although PG&E says it was willing to sell its transmission lines too there was a crucial difference in the two companies' backgrounds that ultimately would influence their approach to the financial crisis. ??Unlike Edison PG&E is a natural gas company as well as an electric company. PG&E a subsidiary of PG&E Corp. had survived the bruising wars of natural gas deregulation in the late 1980s and early 1990s. The experience took PG&E out of the cozy world of the regulated monopoly - in which the utility had exclusive rights to its service territory but was subject to state price controls - and into the world of competition. ??The experience gave PG&E more of a free-market bent said a former PUC staffer who requested anonymity. ??So even though Davis' aides say the governor offered PG&E a plan that would have paid off its debts - including $3 billion to $4 billion for its share of the grid - the utility balked at a key provision. While the original deregulation called for the cap on customer prices to end in 2002 Davis was insisting the utility remain regulated for a decade. ??PG&E wanted an immediate end to Public Utilities Commission regulation and would agree only to a cursory review of rates through a jury-rigged arbitration Davis said last week. ??I believe PG&E was in denial Davis said in an interview with Bee editors and reporters. ??PG&E says it wasn't demanding an end to regulation. Rather what it wanted - and what Davis' negotiator Michael Peevey agreed to in principle - was to let the utility charge ratepayers for all its costs of buying wholesale electricity said PG&E spokesman Ron Low. ??In that same deal reached Feb. 25 in Los Angeles PG&E made a handshake agreement to sell its transmission grid Low said. He wouldn't reveal the price. ??In the weeks that followed the governor's team reneged Low said. The discussions and negotiations broke down because they would not agree to the basic principles that were reached by (PG&E Chairman) Bob Glynn and Michael Peevey Low said. ??PG&E also became disgusted with a series of PUC rulings in late March and early April that it believed would seriously hinder its ability to recover its debts. ??Things came to a head April 5 when Davis proposed a rate increase and outlined his rescue plan in a televised address. A few minutes later Joseph Fichera a Wall Street financier advising Davis and other Davis advisers held a conference call in which they fleshed out the details for investors. Edison officials and directors listened in but PG&E didn't Fichera said. ??They had made up their minds Fichera said referring to PG&E officials. ??The next morning with Glynn dismissing Davis' speech as a lot of words the utility filed for bankruptcy protection. ??That afternoon Davis called PG&E selfish and pointedly went into a negotiating session with John Bryson the chairman and chief executive of Edison's parent Edison International. ??For Davis the meeting was crucial. Although Edison had tentatively agreed in February to sell its transmission lines the deal wasn't sewn up and Davis was nervous the PG&E bankruptcy would prompt Edison's creditors to jerk Edison into bankruptcy Davis said last week. ??That afternoon conceptually we reached an agreement Davis said. The deal was announced the following Monday. ??Consumer advocates and some legislative leaders blasted the agreement as a giveaway and said Davis hastily sweetened the terms for Edison because he needed to show progress on the energy crisis in the wake of the PG&E imbroglio. ??Not true Davis said the basic terms were already on the table before PG&E filed for bankruptcy. Either way Edison was receptive to negotiating with Davis. ??Edison's background is different from PG&E's. Because it isn't in the natural gas business it doesn't have the track record PG&E does with free markets. It is more comfortable in the regulatory and political realm experts say. ??Notably Bryson was president of the PUC in the 1970s - when Davis was Gov. Jerry Brown's chief of staff. ??He knows Gray Davis said ex-PUC President Wilk. He may feel a higher level of comfort in dealing with a very adversarial process. He felt he could rely on the governor. ??Politically savvy Edison is one of the utility industry's biggest contributors to national political campaigns and it usually spends more than PG&E on California campaigns. Edison International's board of directors includes Los Angeles attorney Warren Christopher the former U.S. secretary of state and an elder statesman of the Democratic Party. ??Though it's open to negotiations Edison isn't a pussycat. To the contrary experts say. ??It was usually Edison that was more combative than PG&E said Tom Willoughby a retired PG&E lobbyist. ??Wilk agreed adding: I find it curious that PG&E's being painted as the confrontational aggressive company and Edison as the get-along company. ??Edison hasn't been shy about going to Sacramento for favors last year for example Edison wanted some changes made in the operation of the state's power grid. Instead of talking to the grid manager the Independent System Operator Edison went to the Legislature a source said. Lawmakers then pressured the ISO to make the changes. ??One more factor may have played into Edison's willingness to deal with the governor. ??Last year it became involved in a protracted dispute with the Federal Energy Regulatory Commission which oversees the transmission grid over how much profit Edison could earn from the grid. ??Edison eventually won its point but the case influenced the utility's thinking when Davis offered to buy the grid. According to industry consultant Barbara Barkovich Edison figured why wrestle with the federal government over profits when it simply could raise billions through a cash sale? ??Besides Edison has a back-up plan if the Legislature scraps the grid purchase as many lawmakers have threatened. The company has said it would follow PG&E's lead and file for bankruptcy. ??But its willingness to negotiate with the governor will have served it well even if it goes into bankruptcy said Nancy Day a utility industry veteran consulting for the Legislature. ??Day said she believes the governor's appointees on the PUC will punish PG&E for its behavior. If Edison winds up in bankruptcy court it won't be punished for it Day said. ??PUC President Loretta Lynch couldn't be reached for comment. ??Energy companies at a glance Edison Main subsidiary: Southern California Edison Headquarters: Rosemead Los Angeles County Customers: 4.2 million in Southern California Chairman: John Bryson Performance: Lost $1.94 billion in 2000 on revenue of $11.72 billion Stock ticker symbol: EIX ??PG&E Main subsidiary: Pacific Gas and Electric Co. Headquarters: San Francisco Customers: 13 million in Northern Central California Chairman: Robert Glynn Jr. Performance: Lost $3.36 billion in 2000 on revenue of $26.23 billion. Stock ticker symbol: PCG ??* * * ??The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.com. GRAPHIC: Bryson Glynn LOAD-DATE: April 30 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 McClatchy Newspapers Inc. Bee ??????????????????April 29 2001 Sunday METRO FINAL EDITION SECTION: MAIN NEWS Pg. A3 LENGTH: 679 words HEADLINE: What will be fallout from California's energy meltdown? BYLINE: Dan Walters BODY: ??No one knows for certain how - or when - California's energy crisis will conclude. It is an inordinately complicated four-dimensional chess game that has so far defied politicians' simplistic - perhaps simple-minded - efforts at resolution. ??That said one may speculate reasonably on the financial social and political consequences for California in the months and years ahead. ??Financially Californians - especially the 70 percent who are served by private electric utilities - will feel the pinch for years if not decades to come. Before the crisis hit California's power rates were already among the highest in the nation. Given the nearly $20 billion in power purchase debts that the utilities and the state have accumulated so far the stubbornly high wholesale prices and other data it's not unreasonable to project that Californians in private utility areas will see their rates double or rise even higher. ??Politicians have been laying the rhetorical groundwork for big increases although they've been disingenuous about the outer parameters. The burden will fall most heavily on business customers and coupled with doubts about power reliability and rising natural gas prices will damage the state's ability to attract job-creating investment. States with low and stable energy prices already are using the crisis as a recruiting tool. In February Intel President Craig Barrett told the Wall Street Journal: As long as California is a Third World country we won't build $2 billion manufacturing plants here. ??The inevitable escalation of utility rates will create distortions within the state as well since utility rates for the 30 percent of Californians served by publicly owned utilities are not likely to rise by more than token amounts. The municipal utilities' rates were roughly a third lower than private utilities' rates prior to the crisis. By the time the dust settles they may be just half as much. It will contribute to the balkanization of California that was already being defined by such factors as housing prices ethnicity and income levels. Low-cost regions will become magnets for people and jobs while high-price regions will be shunned. ??The energy crisis will certainly be the defining issue of the 2002 elections and perhaps for others to follow. Gov. Gray Davis' popularity has plummeted since he took charge of the crisis laying waste to his intentions to seek an easy re-election next year as a middle-of-the-road business-friendly tough-on-crime education reformer. ??With his popularity waning Davis may be compelled to turn left shoring up his base by catering to demands of labor unions environmentalists trial lawyers and other liberal elements of the Democratic Party. That in turn would undermine the triangulating strategy he has pursued in which he took Democratic voters for granted and cultivated business executives and social conservatives. Business interests are worried for example that Davis may now feel compelled to sign union-friendly legislation such as boosts in workers' compensation and unemployment benefits that he vetoed in the past. ??Davis' relations with fellow Democrats in the Legislature have turned from cool to poisonous with lawmakers openly trashing his leadership and management of the energy crisis and worrying that he'll try to shift the blame to them if the crisis turns to disaster. If Democratic leaders fear that voters will be in a throw-the-bums-out mood next year they may throttle back on intentions to maximize their party strength in drawing new legislative districts. Such maximization would require spreading Democratic voters out among many districts and such margin-thinning could make Democrats vulnerable in an energy crisis-spawned voter rebellion. Democrats may well strive for fewer but safer seats. ??These are but a few of the potential effects that California will experience long after the immediate crisis has faded whenever that may be. ??* * * ??The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.com. LOAD-DATE: April 30 2001 of 103 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????APRIL 29 2001 SUNDAY FINAL EDITION SECTION: INSIGHT Pg. D1 LENGTH: 1419 words HEADLINE: The energy crisis is good for you SOURCE: Insight Senior Writer BYLINE: Louis Freedberg BODY: Here's a message for pampered and overindulged citizens of the Golden State who complain unceasingly about high energy bills and the day-to-day prospect of rolling blackouts: Stop whining. ???It's not a crisis -- it's an opportunity. The energy crisis is good for us. ???For decades we burned lights whenever we wanted bought more and more energy-guzzling appliances bigger and bigger television sets. Today as citizens of the richest state in the world's only superpower who is going to tell us when to stop? ???We talk about having to hit mules over the head with a 2 by 4 to get their attention but I don't think human beings are much more responsive or foresighted. I hate to see people suffering but on the other hand if that is the way we learn so be it says Ernest Callenbach the Berkeley author of the futuristic 1975 novel Ecotopia. Callenbach's work was a major influence on the alternative energy policies of former Gov. Jerry Brown. ???Nowhere has the ethic of unlimited consumption been more out of control than in the Bay Area where the energy demands of high tech outstripped what the electricity grid could supply. Aside from the energy needs of the industry itself the wealth it generated encouraged avaricious lifestyles that include power-swilling mansions and freeways clogged with monster sport utility vehicles. ???Perhaps the 34 days of blackouts some experts predict for this summer will bring the discipline that eludes us. Except for the hardships the crisis has inflicted on the poor Californians still enjoy a sybaritic lifestyle that in ways would put to shame the pharaohs of Egypt or the court of Louis XIV. Lights still burn when they're not needed. Except for very occasional blackouts electricity still flows 24 hours a day. Our daily routines have barely been affected. A visitor from another state or country would have a hard time finding signs of our highly publicized crisis. ???As we brace for deregulated electric bills courtesy of the state Public Utilities Commission imagine what life was like for Native Americans who lived for millennia in a bounteous Bay Area without microwaves waffle irons air conditioning or 24-cubic-foot refrigerators. No one is suggesting that we revert to those days. But let's consider the thought that we may actually be better off without the piles of appliances whose tangle of cords clogs our homes and offices. ???Smug Californians love to point to the state's ranking as a miserly consumer of energy -- only three other states consume less per capita -- to rebut accusations that we have become greedy energy hogs. Tougher efficiency standards have helped but so has our great weather. California has a uniquely good climate to be efficient says Dan Kammen director of the Renewable and Appropriate Energy Laboratory at the University of California at Berkeley. Compared to countries with much harsher climates we have not done enough. ???There's no denying the sudden sharp pain caused by the crisis -- from threats of sky-high electric bills to fears that California's economic engine is near collapse. But if we handle it right all kinds of positive energy will result. Potential benefits extend from the spiritual (a revival of the conservation ethic) to the curative (making the state immune to power-problem overloads) to the liberating (throwing off for good our dependence on the Texas energy overlords). ???Consumers shocked into action by tripled or quadrupled energy bills are already rushing to Bay Area hardware stores snapping up setback thermostats hot water heater blankets insulating window film and outdoor clotheslines. Alan Ginsberg of Satco Products in Hayward who imports from China container-loads of squiggly shaped energy-saving fluorescent bulbs says They're flying out the door. ???More significantly the crisis impels the state to move ahead with the construction of badly needed power plants. It puts on the agenda of public debate the fundamental question of whether our energy system should be in the hands of giant utilities or run by municipalities or by the state. It certainly unveiled the greed of out-of-state energy producers who have sucked billions of dollars from California. ???The crisis has also made us focus on fundamental flaws in our energy grid such as the 4500-megawatt electricity shortage that emerged in the 1990s while we were all reveling in California's boom times. ???By exposing those who got us into this predicament -- producers utilities regulators and politicians -- there's a chance we'll get out of it with a more rational and efficient energy grid and be better prepared to deal with challenges down the road. If that happens Gov. Gray Davis might yet confound critics who say his political prospects are sinking faster than you can say megawatt. ???The ease and convenience of modern life fools us into thinking that power water and food are infinite. Flip a switch and the lights magically go on. Turn a faucet and water flows. These days the biggest challenge in gathering our daily bread is the hunt for a space in the supermarket parking lot. ???And we want it all leading us straight into denial. We want instant abundant power -- but we don't want any new power plants especially in our backyards. Coal is dirty. Natural gas is expensive. Dams kill salmon. Nuclear power? Forget about it. The contradictions haven't mattered -- so long as an endless supply of electrons flowed from our wall outlets. But that mindless ease the crisis taught us is history. ???The energy crisis warns us that we must become more self-sufficient or risk slipping toward oblivion if we continue to spend billions of dollars on shrinking non-renewable energy sources such as coal and natural gas. ???The Roman Empire fell because of the decadence of its ruling elites. And the British empire dependent on raw materials from the colonies began to collapse when it became too expensive to import goods across oceans. ???A new consciousness about where electricity comes from is the first step toward using less of it. It could also translate into a greater awareness of other environmental causes. ???If we get the message the net outcome (of the energy crisis) will be a quite profound shift in consciousness in energy conservation predicts Michael Lerner executive director of Commonweal a health and environmental institute in Bolinas. ???Such a turnaround is no snap. ???During the last energy crisis in the 1970s there was a similar rush toward conservation. President Jimmy Carter installed solar panels on the White House roof. President Ronald Reagan took them down. He also phased out tax credits and other inducements to encourage development of renewable energy sources. ???Closer to home one of former Gov. George Deukmejian's first acts was to abolish the Office of Appropriate Technology established by Gov. Jerry Brown to move us away from our dependence on non-renewable fossil fuels. ???Since then we have regressed further. Even record high gasoline prices have done nothing to depress the sales of SUVs which now account for the largest share of automobile and light truck sales (20 percent at last count). ???But today's crisis could lead to permanent changes in behavior if only because the technology needed to harness sun wind and other renewable energy sources has become far more cost effective than a generation ago. California already gets 12 percent of its energy from these alternative sources and the market incentives to develop them further has never been higher. ???Stratospherically high electricity bills could finally force on us the technological changes and the discipline that Europeans -- who use two-thirds as much energy per capita as we do -- and the Japanese -- who use only half as much -- have had to embrace. ???This difficult moment in California's history has already yielded some ecological epiphanies like those experienced by Ernest Callenbach's neighbors. They installed solar photovoltaic cells on their roof. The installation now puts surplus electricity back into the energy grid instead of sucking more out of it. ???The magical moment is the idea that by having a photovoltaic cell on your roof you can make your electric meter run backward said Callenbach. Instead of it going to the right you actually see it going in the other direction. You say to yourself 'Oh Lord Oh Lord I have seen the future.' ??Email Louis Freedberg at lfreedberg@sfchronicle.com GRAPHIC: GRAPHIC Don McCartney/The Chronicle LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 Ventura County Star County Star 29 2001 Sunday SECTION: Editorials Pg. B09 LENGTH: 704 words HEADLINE: Reality is what's needed for real policy GOVERNOR: Consumers deserve to get real facts from Davis. BYLINE: Dan Walters BODY: ??Gov. Gray Davis is continuing to tell Californians that he's on top of the state's energy crisis and as he said at one gathering last week in three years this problem will be a distant memory. Fat chance. All major aspects of the situation are growing worse not better minute-by-minute. ??Politicians took over the crisis in January as the state's major utilities exhausted their cash reserves and lines of credit. Davis began what he said then would be a short-term emergency program of power purchases to keep electrons flowing into homes and businesses. ??From that moment forward the situation has steadily deteriorated moving toward a three-pronged disaster: severe summer blackouts the bankruptcy of the utilities and sharply escalating power bills. With the bankruptcy filing by Pacific Gas & Electric Co. and decisions by Davis and the Public Utilities Commission to begin ratcheting up utility rates two of the three negative scenarios are now in place. And everyone involved in the crisis expects blackouts this summer as demands for power soar and supplies dwindle. ??The Davis strategy if there is one is to continue the state's massive power purchases while negotiating longer-term and presumably cheaper supply contracts encourage conservation help utilities pay off their debts by selling their intercity transmission system to the state and tapping ratepayers and build more power plants to ease the supply crunch. ??Currently the governor is touting his deal with Edison International parent company of Southern California Edison to sell its portion of the grid and is working on a similar deal with Sempra the parent of San Diego Gas and Electric. But PG&E's bankruptcy casts doubt on the viability of the cash-for-grid concept and legislators particularly Davis' fellow Democrats are very skeptical of the Edison deal. ??Clearly Davis rushed into the Edison deal just three days after PG&E filed bankruptcy in hopes of erasing the political stain of the latter action but its provisions are being labeled a bailout by critics. It places only a token financial burden on Edison International while guaranteeing the profitability of its utility subsidiary by charging its customers whatever is required to cover its costs and past debts. ??Meanwhile the state is spending -- by Davis' own account -- about $70 million a day or $2-plus billion a month on spot power purchases paying roughly five times what consumers are being charged at the retail level. And the current futures market for power indicates that wholesale power prices will jump by another 50 percent by mid-summer higher prices and greater purchases could increase the drain on the state treasury to as much as $5 billion a month. ??State Treasurer Phil Angelides is desperately trying to arrange a bridge loan to relieve pressure on the state's rapidly vanishing reserves but Wall Street is reluctant to lend without a fuller explanation of what's happening and a specific authorization from a suspicious Legislature. ??He said Tuesday that Davis who has maintained secrecy on power purchases must offer a comprehensive and public plan for dealing with the financial squeeze. ??Meanwhile bankers are sending strong signals that the state government is becoming as poor a lending risk as the utilities. ??Davis for some reason is unwilling to declare this situation the emergency that it is truly becoming -- one that could take a toll of human life if major blackouts shut down air conditioners respirators and traffic lights. He insists on issuing his periodic -- and wholly unrealistic -- assurances that things will turn out all right even declaring to reporters this past Tuesday that we think we'll have this thing licked by the end of fall. ??It's time for someone -- the governor preferably but someone -- to lay out for Californians exactly what's happening the downside financial and power supply risks and what's being done to deal with the looming disaster facing this state. ??It's time for politicians to treat us as adults who can face reality not as children to be fed sugarcoated sound bites and slogans. ??-- Dan Walters writes for the Sacramento Bee. LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 28 2001 Saturday Home Edition SECTION: Part A Part 1 Page 19 Metro Desk LENGTH: 679 words HEADLINE: OFFICIALS CALL PRICE STABILITY PLAN ILLEGAL UTILITIES: AGENCY CHIEFS SAY THE FEDERAL PROPOSAL COULD ALSO CAUSE MORE BLACKOUTS THIS SUMMER. BYLINE: NANCY VOGEL and MIGUEL BUSTILLO TIMES STAFF WRITERS DATELINE: SACRAMENTO BODY: ??Two top state energy officials said Friday that a federal plan to stabilize electricity prices in California could increase the odds of blackouts this summer and most likely is illegal. ??In a barrage of complaints attacking the Federal Energy Regulatory Commission the state's top power regulator and the head of the board overseeing California's transmission grid said they might challenge the federal order in court. ??The order was approved on a 2-1 vote Wednesday and released to the public late Thursday. ??We're going to take whatever actions we can to oppose this to the extent our lawyers tell us it's illegal said Michael Kahn an attorney named by Gov. Gray Davis to head the board overseeing the California Independent System Operator. Cal-ISO manages the transmission grid reaching three-quarters of the state. ??In a conference call with reporters Kahn and Loretta Lynch president of the California Public Utilities Commission said the order also seems to indicate that FERC is unwilling to force power sellers to rebate any of the extraordinary profits earned before last October in California's market where wholesale electricity prices began soaring last May. ??And according to Kahn the federal order illegally ties limits on power prices to a requirement that California link its transmission grid with those of other states. ??It's not within their authority to have this kind of linkage he said. ??The federal order is scheduled to take effect May 29. Though it is not clear how the order will play out in the state's electricity market Lynch and Kahn said they do not believe it will bring down power costs or help the state avoid blackouts as intended. ??They're creating a whole new wholesale blackout system said Lynch referring to a section of the order that allows large customers such as steel mills and food processors to get paid to shut down when grid operators are struggling to find enough electricity to meet demand. ??Though a somewhat similar program has helped California avoid blackouts the federal order requires state power buyers to name the price to which electricity must rise before they shut down customers. ??The requirement of naming a price could lead to more blackouts said Stanford University economist Frank Wolak because it prevents power buyers from paying more if that's what it takes to keep electricity flowing. ??Stating your price and sticking to it means that somebody could call your bluff Wolak said. The generators just say look we can't supply all you want at the price you want to pay. ??So they supply everything they can at the price we're willing to pay--and no more--and we have rotating blackouts he said. ??Lynch said that no matter how this aspect of the FERC order unfolds it ain't for Washington bureaucrats to decide when the lights go out in California. ??Grid operators at Cal-ISO must quickly buy batches of electricity to constantly match supply and demand on the transmission system serving most of the state excluding the city of Los Angeles. When Cal-ISO cannot find enough power it must order Southern California Edison Pacific Gas & Electric and San Diego Gas & Electric to trigger rotating blackouts. ??The state suffered such controlled outages on four days in January and March and many such days are predicted for this summer as air conditioning drives up demand for power. ??In other energy news Friday Gov. Gray Davis announced in Los Angeles that electricity use in California state office buildings dropped by an average of 20% in the first two months of this year compared to the same months of 2000. State workers have been under orders since late last year to turn off nonessential lights computers printers and other electrical appliances. Some agencies have even changed workers' schedules eliminating flextime so that everyone works the same hours and the offices can open later and close earlier shortening the energy-using day. ??* ??Times staff writer Mitchell Landsberg in Los Angeles contributed to this story. LOAD-DATE: April 28 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 28 2001 Saturday Home Edition SECTION: Part A Part 1 Page 19 Metro Desk LENGTH: 688 words HEADLINE: BILL COULD FOIL DAVIS' ELECTRICITY OFFENSIVE POWER: CONGRESSMAN WANTS TO LET SMALL PRODUCERS SELL ON WHOLESALE MARKET. BACKERS SAY PLAN WOULD BOOST SUPPLY BUT FOES SEE IT COSTING CALIFORNIA DEARLY. BYLINE: JULIE TAMAKI and MIGUEL BUSTILLO TIMES STAFF WRITERS DATELINE: SACRAMENTO BODY: ??A Texas congressman plans to introduce legislation next week that would allow California's small power producers to sell their supplies on the wholesale market--a move that could threaten Gov. Gray Davis' plan to end the state's energy crisis. ??The proposal by Republican Rep. Joe Barton the influential chairman of the House energy and air quality subcommittee would permit producers of alternative and renewable energy to suspend their contracts with the state's two biggest investor-owned utilities and sell their supplies to a third party. ??Proponents say the bill could dramatically bolster the state's electricity supplies by luring producers whose plants have been shut down by payment disputes to restart them in time for summer when supplies are expected to be tight and blackouts are feared. ??But allowing producers to sell to a third party would essentially devastate Davis' plan to rescue the utilities and get the state out of the business of making emergency electricity purchases. ??The governor's plan is based on California locking down the costs of electricity from the utilities and small power producers for several years at a reduced cost. ??During that time the state would buy the remaining portion of the electricity the utilities need to serve their customers. Meanwhile the utilities would regain their financial footing by selling assets to the state in exchange for being allowed to recover a portion of their back debt through a surcharge on electricity bills. ??If the alternative producers were allowed to sell their power on the wholesale market the state could be forced to purchase much more electricity on the expensive open market. ??That would dramatically increase California's already massive power costs forcing the state to further raise electricity rates and borrow even more than the record $ 12 billion in bonds it is planning to finance the plan. The state has spent more than $ 5 billion buying electricity that the utilities cannot afford and Davis expects to spend $ 15 billion by year's end. ??It is a way of busting the budget for the state of California said Joseph Fichera a Wall Street energy consultant hired by the Davis administration. He called the potential release of the small producers a disaster scenario for the state. ??Added Stephen E. Frank chairman president and chief executive of Southern California Edison: Releasing them from their contractual obligations will simply exacerbate the problem because they would then be selling into the market at additionally higher rates and just compound the state's problems. ??But Eugene Peters of the Electric Power Supply Assn. disputed that contention. The state he said is already buying replacement supplies on the open market because of reduced output by small producers. ??If 3000 megawatts are made available again it will have a potentially profound effect on what people pay for power by bolstering overall electricity supplies Peters said. ??Utility executives contend that only 1200 megawatts are offline because of payment problems. ??California is home to nearly 700 small energy producers which generate more than a quarter of the electricity consumed in the state. They differ from their big out-of-state counterparts which have been getting paid by the state. ??The Barton proposal will be the subject of public hearings Tuesday and Thursday and could move to the full House Energy and Commerce Committee for a vote the next week. Barton could not be reached for comment Friday. ??The alternative-energy provision is one of several in his emergency energy bill. Others designed to help the West through a difficult summer of price spikes and energy shortages range from offering federal aid to relieving a bottleneck in the transmission system to permitting governors to secure waivers from environmental rules to boost power supplies. ??The provisions dealing with waivers of environmental rules have been among the most controversial drawing opposition from environmentalists. ??* ??Times staff writer Richard Simon in Washington contributed to this story. LOAD-DATE: April 28 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 28 2001 Saturday Home Edition SECTION: Business Part C Page 2 Financial Desk LENGTH: 137 words HEADLINE: BRIEFLY / ENERGY PUC ORDERS UTILITIES TO POST BLACKOUT DATA BYLINE: Nancy Rivera Brooks BODY: ??Responding to customer complaints the California Public Utilities Commission ordered Southern California Edison and San Diego Gas & Electric to tell customers more about when they will be blacked out during times of extreme power shortages. The PUC told Edison and SDG&E to begin listing on electricity bills by June 1 the outage block into which each customer falls. ?The utilities then must use their Web sites to tell customers which blocks are slated for blackouts should more rotating outages be required. Pacific Gas & Electric Co. already lists outage block numbers on its customer bills. A pop-up box on PG&E's Web site shows which blocks are next in line for blackouts. Edison and SDG&E said they have been working on implementing such notification on their own and will comply with the PUC ruling. LOAD-DATE: April 28 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 McClatchy Newspapers Inc. Bee ?????????????????April 28 2001 Saturday METRO FINAL EDITION SECTION: MAIN NEWS Pg. A3 POWER CRUNCH LENGTH: 1109 words HEADLINE: Cities take new look at public power The state's uncertain electricity picture has local officials deciding it's time to revisit the idea of municipal utilities. BYLINE: Carrie Peyton Bee Staff Writer BODY: ??From the shipwreck of California's electric industry Albert Vera sees a chance to build a life raft. ??This is an opportunity that shall never come again the former Culver City mayor told city and county officials gathered this week in Sacramento. ??Every rate hike every blackout every corporate bonus is more evidence for believers that it's time for local government to get into the power business. They pin their hopes on municipal utility drives in San Francisco Corona San Diego County and beyond. ??Over the past few years however only a handful of cities have set up their own electric departments and they are mostly limited entities that fall short of full-fledged utilities. More commonly cities - including Davis Lincoln and Culver City - have studied the idea and rejected it at least temporarily. ??They all face the same question said Santa Rosa City Manager Jeffrey Kolin: ??Is the investment worth the risk? Most of us would say we don't know yet. ??Kolin's city like scores of others across the state has decided it is time to study the issue anew motivated by the prospect of soaring electric bills repeated blackouts and Pacific Gas and Electric Co.'s bankruptcy filing. ??All their citizens are screaming said Yvonne Hunter a lobbyist for the League of California Cities. ??The highest visibility fight will likely come in November when San Franciscans go to the polls to decided whether to create their own utility in a city that houses PG&E's corporate headquarters. ??We will take it very seriously PG&E spokesman John Nelson said. ??Shortly after deregulation in 1996 several drives for ratepayer-owned utilities stumbled or stalled. An effort in the far north state to create a multicounty public power agency was rejected by state regulators because some local governments objected. ??Now with a bill to create a state power authority moving through the Legislature some believe the climate may be changing. ??One of the things this crisis has proved is the value of local control said Jerry Jordan head of the California Municipal Utilities Association. ??Since January the cities of Hercules in the Bay Area and Corona in Southern California have formed utilities to deliver electric service to new neighborhoods - a strategy that sidesteps potential condemnation fights with the existing utility. The county of San Diego is trying to get special legislative authority to create a regional power agency without a popular vote. ??We could produce power better cheaper and faster than the private sector county Supervisor Dianne Jacob said. ??Not so say PG&E and Southern California Edison. ??There's been much more talk of it but as soon as most folks sit down and take a look at the realities ... they realize that they would have to buy on the same market at the same outrageous prices that we and the state have been paying Nelson said. The talk quickly evaporates. ??For-profit utilities have long argued that government shouldn't usurp the role of private industry in delivering electricity. PG&E contends that the factors that once made public power attractive - such as access to low-cost electricity from federal dams - have evaporated. ??In addition cities that try to withdraw from PG&E or Edison now probably would still have to funnel money their way for years to come to pay off still-unsold state bonds that will stretch out a single year's power costs for up to 15 years. ??With so many unknowns the next few years are likelier to produce more studies than new utilities said a number of city officials who attended a seminar in Sacramento this week sponsored in part by the American Public Power Association. ??Former New York state Sen. Al Coppola told the group the session should have been titled: Independence from the greedy robber baron utilities. ??Public power backers share three key beliefs: ??* They can charge customers less because they don't have to pay dividends to investors or pay taxes on their sales they can respond to local preferences on issues like which customers pay the lowest rates and how blackouts are staged and existing utilities will do everything in their power to oppose them. ??Edison did the right thing - (use) fear to discourage Culver City from creating an electric arm in 1995 Vera the city's former mayor told the group. ??And Glenn Prentice head of the newly created Corona electric utility said in an interview that a half-dozen other cities have contacted him for more information but he declined to name them. ??If I do Edison will start the attack on them. We're talking about a lot of money he said. We're here to serve the public. They're here to make money. ??PG&E sees new utilities as competition for our business and it has a policy of lobbying hard against them Nelson said. ??Less than 18 months ago it warned residents of the Placer County town of Lincoln that a city power enterprise would be costlier and less dependable than PG&E and its officials labeled the effort a tax dodge. ??But by January of this year PG&E barely blinked when Hercules set up a utility to deliver power and telecommunications service in new neighborhoods. ??We got more resistance from AT&T and PacBell said Raj Pankhania assistant to the city manager of Hercules. ??Pankhania has been researching utility drives across the state and has seen no groundswell for public power although he believes it can bring cities added revenue and more local control. ??That could change this summer Prentice said. ??It really depends on how bad the blackouts are. ??A blackout that left one city councilmember's daughter at a darkened school was part of what led the Riverside County city of Corona to vote April 4 to form its own electric arm he said. Heavy industry became anxious too. ??They said to the city council 'Do something!' Prentice said. ??Skipping detailed studies Corona quickly decided to create a utility that will build small power plants under 50 megawatts to serve city operations and new neighborhoods in the city of 127000 east of Disneyland. ??In time said Hercules' Pankhania cities like his could become the living laboratory for whichever system can deliver better service and lower rates. ??Hercules' plans calls for the older two-thirds of its homes and businesses to retain their PG&E service and the newest third to be served by the city utility. ??The existing homeowner will definitely compare five to 10 years down the road he said. Then let the people decide which way they want to go. ??* * * ??The Bee's Carrie Peyton can be reached at (916) 321-1086 or cpeyton@sacbee.com. LOAD-DATE: April 29 2001 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Letter to President on Energy Efficiency - Immediate Review Reque sted Body:: Decline. Rosalee Fleming 09/21/2000 05:29 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Letter to President on Energy Efficiency - Immediate Review Reque sted Is this something we want to do? ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CONFIDENTIAL - Residential in CA Body:: I like the idea particularly if we can time any decision to turn the customers back so it falls after the failure to get some action out of Sacto (instead of after our earnings release). The only problem I see is that we would need a decision from the top that we're not going to turn the customers back if we get direct access (so we can end the debate). I don't think it helps us if we get lucky get direct access back then make a decision to return customers to the utility. Karen Denne@ENRON 04/13/2001 10:30 AM To: James D Steffes/NA/Enron@Enron cc: Jeff Dasovich/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Sandra McCubbin/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Mark Palmer/Corp/Enron@ENRON Susan J Mara/NA/Enron@ENRON Peggy Mahoney/HOU/EES@EES Harry Kingerski/NA/Enron@Enron Dan Leff/HOU/EES@EES Subject: Re: CONFIDENTIAL - Residential in CA Before any decision is made I think we really need to weigh in with EES on the ramifications (both PR and legislative) of turning back 16000 residential customers. I strongly believe that the public hit we will take will be far greater than our actual out-of-pocket losses. We will be crucified by the public media consumer groups legislators governor attorney general etc. and this action will reaffirm our reputation of packing up and leaving when it's not in our interest. The impact of this action would be exacerbated since it is on the heels of UC/CSU. I would also argue that this hurts our national dereg efforts. If we're advocating that competition and choice benefits consumers and then we turn around and pull out of a market and abandon customers when we're not profiting we'll kill any chances we have of ever serving retail customers in California -- or in any other state. We look foolish advocating for direct access when we're not willing to serve our existing -- let alone future customers What about a preemptive strike that engages these 16000 customers to weigh in on direct access -- i.e. a letter that says Enron may be forced to cancel its contract -- call/write/send the enclosed postcard to your legislator and tell them you want to keep your right to choose your energy service provider. Our credibility is on the line. Before we take this action we need to be cognizant of all the long-range strategic implications and we need to seriously weigh the negative impact this will have on our corporate reputation on our legislative abilities and on our commercial success going forward. kd James D Steffes 04/12/2001 09:05 PM To: Jeff Dasovich/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Sandra McCubbin/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Mark Palmer/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON Susan J Mara/NA/Enron Peggy Mahoney/HOU/EES@EES Harry Kingerski/NA/Enron@Enron cc: Dan Leff/HOU/EES@EES Subject: CONFIDENTIAL - Residential in CA In the meeting today no decision was made about what to do with Enron's 16000 residential customers. Each of the contracts gives a basic 30 day out right to Enron. That being said I think that we have a short window to push for DA before any public action impacts us in Sacramento. I realize that the ultimate action (which I think is inevitable) makes it harder for our advocacy on DA but real $ are flowing out of the company. EES will give us notice when a decision is reached. Thanks Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Astros Body:: Yes please. From: Elizabeth Linnell on 05/16/2001 12:02 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Astros I noticed that several groups within your overall organization charged tickets or our suite to their cost centers this month. I know of the business purpose for a couple but not all. Let me know if you're interested in this info and I'll get more data from Greg. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request from Bob Frank Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions Body:: How important is this fight to us now (see attached article on ExIm)? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: USG overtures on Dabhol Body:: Thanks for the update. From: John Hardy@ENRON_DEVELOPMENT on 05/10/2001 09:48 AM To: Rebecca McDonald/Enron@EnronXGate cc: Ben Glisan@ECT Steven J Kean/NA/Enron@Enron Rob Walls/ENRON@enronXgate Subject: USG overtures on Dabhol Rebecca At a meeting yesterday at OPIC on Trakya another of our problem projects Dabhol was raised. A representative from the White House transition team joined the conversation. I was asked the terms under which we were prepared to negotiate and I told them at a minimum upon a commitment by the Indian authorities to serious negotiations which would include full compliance with the terms of the contracts and progress in the reform of the MSEB. I made clear that we do not see the Godbole Committee as the basis for such a discussion. I think the USG wants to be on record politically encouraging the Indian Govt. to engage in discussions all parties consider to be meaningful in hopes of working things out before it is too late even while through OPIC and EXIM it is supporting the move towards PNT. The administration may be concerned that without such a diplomatic overture on its part it could be concluded that the USG has politically taken a position on the project. In Trakya for example the USG has been quite proactive in pressing the Turkish govt on the payments issue and even in discussing the payment concerns with the IMF so that the payments issues for the BOTs (two of the four in Turkey are US sponsored) are taken into account as the IMF program moves forward. So I anticipate that the USG will shortly be meeting with the Indian ambassador here and the US Charge in Delhiwill likely be directed to make the rounds and meet with senior government officals on the project. I wanted you to be aware of this also any guidance you can provide would be helpful. Thanks John What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Job Titles and Job Banding Body:: Thanks for your message. I do think we need to talk this through. In the meantime though let's not make anymore VPs until this is resolved. As I said in my original message I am not looking to undo what has been done but to make sure we don't do it again unless the process is followed. I understand that there are significant title differences across the regions we operate. In fact one of the people in my organization who did not make VP is Dennis Vegas who has done an extraordinary job in Latin America. Notwithstanding his regional focus (and the significance of a VP title in his region) he was put through the company wide process and he David Haug and I submit everyone else on the Exec Comm understood that every new VP would go through the same process regardless of regional assignment (with the exception of certain joint venture companies). But I maintain that we need some consistency in the VP title in particular -- i.e. that it remain an Enron-wide title granted only through the PRC process. Though I don't personally feel this way for many people in the organization the VP title means something separate from the compensation structure it implies something like making partner in a legal or consulting firm. Making that cut should not vary based on where you live or what region you support. I also understand the point about needing a certain title for external purposes. In my organization we are dealing with very title-conscious elected officials and media. I can make the case for every one of my directors and senior directors that they would be more effective externally if they carried a more senior title regardless of any change in compensation. As an executive committee we elected to make such an exception only for legacy title holders -- i.e. people who had previously made VP outside the process. Everyone in my organization To: Cindy Olson@ENRON Steven J Kean@EES cc: Sanjay Subject: Job Titles and Job Banding From reading the e-mails on the issue regarding Regional Vice President at Enron India it sounds like there will be more discussion on this issue. I know that issues like this generally come up at the Enron ExCom level. There are a few issues that need to be kept in mind and although Cindy and I have discussed these in the past I have not had an opportunity to pursue them further (but would be happy to help out on this). I have noticed these not only in India but also in the other international settings where I have worked for Enron during the past several years. 1. International job titles and domestic job titles do not correlate. For example in India the title Director implies a very senior person within the organization (well above VP) whereas in the Enron domestic world it is a position below VP. Managing Director within Enron is below the most senior levels but in India a MD is the Ken Lay equivalent. For this reason I cannot use Managing Director in my title or on my business card although this is my title for Enron Houston purposes. 2. Job titles are much more important in an international setting than in a domestic setting. For example in Houston we have people at the director (and probably manager) level who lead deal teams and bring deals to successful closing. In an international setting particularly India to get to the decision-makers in your counterpart organization an officer title of VP or above is very often required. To a certain degree this is form over substance but that's what works over here. 3. To solve some of these problems Enron should consider doing what some other international companies have done (and I think Cindy and her team may already be working on this). A job banding study should be done and based on responsibilities everyone globally should be placed in a band. It would not be a title band of VP or director or manager but rather a band with a non-title classification. I hate to suggest a band with numbers such as 1 through 15 because that sounds way too much like the government but something like that would work. Once this is done communication is made to employees that the band is what is key in determining their compensation and level within the organization. Then the business units can rely on their particular market dynamics or on what their competition is doing to determine job titles. Thus if the Global Origination group needs to have a title of Senior Trader and EECC needs a title of Project Leader and Enron India needs a Regional Vice President all can be accomplished while keeping these same people at a consistent level for global Enron purposes. I will be happy to discuss this further with any of you. Plus I will volunteer to participate in finding a solution that works for all of Enron while taking into account the specifc business unit and/or global function needs. Wade What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Opinion Elite Survey Body:: Have we made this available to the Cheney team? From: Mark Palmer on 04/25/2001 04:02 PM To: Richard Shapiro/NA/Enron@Enron Steven J Kean/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Karen Denne/Corp/Enron@ENRON Joe Hartsoe/Corp/Enron@ENRON cc: Subject: Opinion Elite Survey Here's the Opinion Elite file. It looks very strong for our open access argument. Suggest we update the WH. Any other uses? I have the verbatims and cross tabs. We'll send a sanitized version (although there's not much I wouldn't want everybody to see) to some of the interviewees who requested it. Mark What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: the summary report, I am sorry. Body:: Thanks Vince What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Nick Lampson called and asked for a contribution. I committed to one without knowing about his vote on PNTR. I will keep my word by making an individual contribution but will also communicate to him that in my capacity as Enron PAC chair i cannot authorize the PAC to make a contribution as a result of that vote. Sorry I jumped the gun. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: AP Wire services Tues 3/20: Calif. Officials Order Blackouts Dow Jones News Tues 3/20: California Panel to Order Utilities to Make $1= =20 Billion in Back Payments SF Chron 3/20: As Davis Seeks Money Lawmakers Want Answers=20 Members of both parties angry at lack of dialogue Fresno Bee Tues 3/20: Jones rips state on energy crisis Sac Bee Wed. 3/21: Day 2 -- Battling blackouts: Payment plan sought to= =20 restart small plants Sac Bee Wed. 3/21: Hospitals take hit seek power guarantee Sac Bee Wed. 3/21: Lodi still won't pull the plug San Diego Union Tues. 3/20: Blackouts hit for second day break seen=20 Wednesday San Diego Union Tues. 3/20: State power regulators working on energy=20 rescue=20 San Diego Union Tues. 3/20: Federal regulators scored for not ordering= =20 more California refunds LA Times Wed. 3/21: Second Day of Blackouts Disrupts 500000 Home and= =20 Businesses LA Times Wed. 3/21: Fragile Supply Network Apt to Fail LA Times Wed. 3/21: Elevator Anxiety is Riding High LA Times Wed. 3/21: State says it's accelerating plan to buy Power=20 Utilities' Grid LA Times Wed. 3/21: L.A. Long Beach File Suits Over Gas Companies'=20 Prices LA Times Wed. 3/21: Davis OKs Subsidy of Pollution Fees LA Times Wed. 3/21: As Losses Mount Companies work around outages LA Times Wed. 3/21: Commentary: A Blackout on Answers LA Times Wed. 3/21: Commentary: Rolling Blackouts: Blatant Extortion SF Chron Wed. 3/21: Utilities' Demand Blocks Bailout=20 NEGOTIATIONS HIT SNAG: PG&E Edison want end to price freeze if they sell= =20 transmission lines to state SF Chron Wed. 3/21: Utilities' Demand Blocks Bailout=20 BLACKOUTS ROLL ON: Weather increased consumption blamed SF Chron Wed. 3/21: Manners Go Out the Window=20 Pedestrians in peril as drivers turn darkened S.F. streets into free-for-al= l SF Chron Tues. 3/20: Historic Blackouts in State=20 Bay Area learns to cope SF Chron. Tues. 3/20: Second day of rolling blackouts in power-starved= =20 California Mercury News. Wed. 3/21: Bay Area Residents Learning to roll with=20 Blackouts Orange County Wed. 3/21: Powerless Again Orange County Wed. 3/21: The iceman shunneth effects of hourlong blacko= ut Orange County Wed. 3/21: Traffic officials are seeing red over blackout= s Orange County Wed. 3/21: Alternative power producers cut back or shut= =20 down as payments from big utilities lag Orange County Wed. 3/21: O.C. saves its energy -- for blaming others Orange County Wed. 3/21: Blackout readiness on agenda Dow Jones Energy News Wed. 3/21: Calif To Order Utils To Pay Small=20 Generators Up Front-Gov Dow Jones Energy News. Wed. 3/21: PG&E Says It Is Negotiating With=20 Qualifying Facilities Energy Insight Wed. 3/21: New York at the Crossroads --- Calif. Officials Order Blackouts=20 By PAUL CHAVEZ Associated Press Writer=20 LOS ANGELES (AP) - State power managers ordered rolling blackouts across=20 California for a second straight day Tuesday as demand for electricity agai= n=20 exceeded supply.=20 The same factors that collided to strap California's power supply on Monday= =20 hit again officials with the Independent System Operator said. Those inclu= de=20 reduced electricity imports from the Pacific Northwest numerous power plan= ts=20 offline for repairs and higher-than-expected demand because of warm=20 temperatures.=20 A two-unit Southern California plant that the ISO hoped would be working=20 Tuesday had not been fixed. One of its units might go online at noon to hel= p=20 the situation the ISO's Jim Detmers said.=20 In addition hydroelectric power imports from the Northwest were 800=20 megawatts lower than Monday he said. The ISO oversees most of the state's= =20 power grid.=20 --- California Panel to Order Utilities to Make $1 Billion in Back Payments By Jason Leopold 03/20/2001 Dow Jones Business News (Copyright (c) 2001 Dow Jones & Company Inc.) Dow Jones Newswires=20 LOS ANGELES -- The California Public Utilities Commission will order Edison= =20 International's Southern California Edison and PG&E Corp.'s Pacific Gas &= =20 Electric unit to pay small power generators that are qualified utilities=20 about $1 billion in past-due payments in order to keep the plant owners fro= m=20 dragging the utilities into an involuntary bankruptcy proceedings and to= =20 also ensure the generation units keep pumping out electricity people=20 familiar with the matter told Dow Jones Newswires late Monday. Gov. Gray Davis state Sen. Debra Bowen and Assemblymembers Fred Keeley an= d=20 Robert Hertzberg all Democrats spent most of the day y trying to hammer o= ut=20 an agreement with the so-called qualifying facilities alternative power=20 producers that use the wind sun steam and biomass to generate electricity= =20 for the state on supply contracts and past payments the utilities failed t= o=20 make.=20 The qualifying facilities which represent about one-third of the state's= =20 total power supply and signed contracts to sell power directly to the=20 utilities under a government mandate would then agree to sign power-supply= =20 contracts with the utilities for a period of five to 10 years for about $79= a=20 megawatt hour for the first five years and about $61 a megawatt hour=20 thereafter two sources involved in the negotiations said.=20 The PUC is expected to issue a draft resolution on the issue sometime this= =20 week one source said.=20 The lawmakers wouldn't comment on the details of their talks Monday.=20 Representatives with SoCal Ed (EIX) and PG&E (PCG) said they were unaware= =20 Gov. Davis and his administration were meeting on the issue.=20 The utilities are more than $13 billion in debt and have failed to make=20 payments on their qualifying-facilities contracts since November. PG&E has= =20 paid some of its qualified facilities just a fraction of what they are owed= .=20 Legislation To Restructure QF Rates Stalls In Senate Energy Committee=20 Mr. Keeley had recently drafted legislation along with state Sen. Jim=20 Battin a Republican from Palm Desert that would have restructured the rat= es=20 the qualified facilities charge the utilities from $170 a megawatt hour to= =20 $80 a megawatt hour for five years.=20 The bill SB47X stalled in the Senate Energy Committee of which Ms. Bowen= =20 chairs. SoCal Ed opposed the legislation saying the rates were still too= =20 high. A utility spokesman said the qualified-facilities rates should be=20 reduced to under $50 a megawatt hour.=20 But the lawmakers and the governor is trying to avoid the need for=20 legislation largely because there isn't much support in both houses for su= ch=20 a bill and the chance that it won't be passed in time to keep the qualified= =20 facilities from dragging the utilities into involuntary bankruptcy=20 proceedings the legislative source said.=20 The PUC will take over the issue from the Legislature the source said.=20 Monday about 3000 megawatts of qualified-facilities generation went offli= ne=20 because the companies that operate the power plants can no longer afford to= =20 buy natural gas used to fuel the plants due to the utilities' failure to pa= y=20 money owed to the companies said Jim Detmers vice president of operations= =20 for the state's Independent System Operator.=20 The outages triggered a major shortfall in the state which resulted in near= ly=20 eight hours of statewide rolling blackouts Monday.=20 Many owners of the qualified-facilities said without immediate relief they= =20 would likely force SoCal Ed and possibly PG&E into involuntary bankruptcy= =20 perhaps as soon as Thursday.=20 One such facility CalEnergyOperating Co. wants to be freed temporarily fr= om=20 its contract with the utility and be allowed to sell its electricity to thi= rd=20 parties until the utility is able to pay its bills. CalEnergy is an affilia= te=20 of MidAmerican Energy Holdings Co. which is majority owned by Warren=20 Buffet's Berkshire Hathaway Inc. (BRKA).=20 The company sued SoCal Ed last month and the case is scheduled to be heard= =20 Thursday in Imperial County Superior Court. If a judge delivers an=20 unfavorable ruling CalEnergy and other unsecured creditors would drag SoCa= l=20 Ed into involuntary bankruptcy three executives with the companies involve= d=20 said.=20 CalEnergy is said to be organizing a bankruptcy petition now circulating=20 among six of Southern California Edison's independent power suppliers and= =20 could file the petition very quickly if it fails in its suit Thursday said= =20 executives with three of the six companies.=20 Write to Jason Leopold at jason.leopold@dowjones.com=20 Copyright (c) 2001 Dow Jones & Company Inc.=20 All Rights Reserved --- --- As Davis Seeks Money Lawmakers Want Answers=20 Members of both parties angry at lack of dialogue=20 Lynda Gledhill Greg Lucas Chronicle Sacramento Bureau Tuesday March 20 2001=20 2001 San Francisco Chronicle=20 Sacramento -- The Legislature has warned it may block further state purchas= es=20 of electricity as lawmakers' frustration with Gov. Gray Davis' handling of= =20 the energy crisis increases.=20 A test may come soon because Davis asked yesterday for another $500 million= =20 to continue buying power.=20 Sen. Steve Peace D-El Cajon chairman of the Joint Legislative Budget=20 Committee wrote to Davis' Finance Department on Friday that the committee= =20 might deny further spending requests in the absence any discernable=20 progress from the Public Utilities Commission to ensure that the state wou= ld=20 get its money back.=20 Members of the committee both Republican and Democratic said they support= ed=20 Peace's call for more oversight of the spending given the lack of=20 information from Davis on details of the state's power purchases.=20 He's been holding things close to the chest and that bothers me said Se= n.=20 John Vasconcellos D-Santa Clara. I want to know a lot more.=20 Sen. Dick Ackerman R-Fullerton said the administration has been=20 stonewalling us about how much is being spent and how much power we're=20 getting for it. When the state is spending that kind of money at a minimum= =20 legislators should know for what.=20 The state had spent $2.6 billion on electricity through March 11. Davis'=20 request for more money would put the state at the $3 billion mark by the=20 middle of April. The state is spending an average of $49 million a day.=20 The money is supposed to be paid back through the rates collected from=20 utilities' customers. It is up to the PUC to decide how to divide that mone= y=20 among the state the utilities and the utilities' debtors. The commission i= s=20 scheduled to take up the issue at its March 27 meeting.=20 The problem is that there appear to be more demands on the money than there= =20 is money to go around.=20 The utilities have said they need the money to pay off some of their=20 creditors. Among those looking for cash are alternative-power generators th= at=20 were selling electricity to Pacific Gas and Electric Co. and Southern=20 California Edison. Half of them have shut down because they have not been= =20 paid.=20 Earlier this month the PUC granted the Department of Water Resources whic= h=20 has been purchasing electricity for the state the power to recoup its full= =20 costs through rates.=20 It's unclear whether that can be accomplished without raising electricity= =20 prices though Davis has insisted he can solve the crisis without boosting= =20 rates.=20 Lawmakers said they approved the bill that allowed the state to buy power i= n=20 the belief such purchases would be a stopgap until the Davis administration= =20 could sign long-term contracts with power suppliers. However only about 19= =20 contracts have been signed to date out of 42 agreements. If all the=20 contracts are signed they will account for about 70 percent of the power= =20 California is expected to need.=20 It was our expectation some of these contracts would kick in said=20 Assemblywoman Carole Migden D-San Francisco. This was designed to only be= =20 bridge money to avert a power disaster. We should hold firm and come up wit= h=20 a plan.=20 I recall about three weeks ago when we first asked about one of these $500= =20 million letters Migden said. We said maybe this one is necessary but=20 there won't be carte blanche approval of any future requests. I'm pleased= =20 Sen. Peace is taking that approach.=20 To Assemblyman George Runner R-Lancaster Peace's letter was another way= =20 for the Legislature to send a message we need to be in this loop. We're jus= t=20 getting a small little dribble of information which just creates more=20 questions.=20 A spokesman for the Department of Finance said officials hoped to work with= =20 the committee members about their concerns.=20 --- --- Jones rips state on energy crisis=20 Secretary of state hints that he'll take on Davis in 2002.=20 By John Ellis=20 The Fresno Bee (Published March 20 2001)=20 Officially he's Bill Jones secretary of state for California. Unofficiall= y=20 he's Bill Jones 2002 gubernatorial candidate.=20 The evidence is right there between the lines -- in the subtleties of his= =20 speeches their subject matter and the way Jones carries himself when he's= =20 in public.=20 Monday was no different as Jones addressed a Rotary Club luncheon in Fresn= o=20 full of people who are assuming -- though nothing is official -- that the= =20 Fresno native will soon announce his intention to challenge Gov. Davis next= =20 year.=20 Bill they call me governor Chas Looney a former Rotary Club district= =20 governor quipped to Jones. I look forward to the day we all can call you= =20 governor.=20 Jones then proceeded to deliver a speech to a packed house in the DoubleTre= e=20 Hotel that touched on his accomplishments as secretary of state but quickl= y=20 moved to his main topic: California's crumbling infrastructure and how the= =20 energy crisis is affecting the state.=20 Always in the background but never mentioned by name was Davis. Jones was= =20 careful to hew to the Rotary rule that speeches steer clear of partisan=20 politics.=20 Still Jones looked sounded and acted like a candidate for governor and= =20 near the end of his speech he promised his decision would come soon.=20 The Fresno Republican's speech began by highlighting his work in passing th= e=20 Three Strikes and You're Out initiative in 1994.=20 Jones also talked of his efforts to remove 2 million inactive California=20 voters from the rolls.=20 But it was clearly the energy crisis and its ramifications -- an issue=20 Republicans feel they can pin on Davis and the Democratic-controlled=20 Legislature -- that was the centerpiece of the speech.=20 Today the energy crisis is being driven he said by a lack of power plant= =20 construction. And while billions go to solve the crisis he said the state= =20 faces $100 billion in unmet infrastructure needs -- everything from school= =20 repair to road repair.=20 Doesn't that scare you? Jones asked.=20 He then recounted the warning signs -- ignored by the state he said -- of= =20 the looming energy crisis.=20 He cited the initial warnings that the deregulation bill was flawed last= =20 summer's request by Edison and Pacific Gas & Electric to allow forward=20 contracting and the Republican request for a special session to deal with t= he=20 energy crisis. All ignored Jones said.=20 Now Edison and PG&E are near bankruptcy and the state finds itself steppin= g=20 up as a creditor. And the solution now becomes California getting into the= =20 energy business he said. Or even carrying it to a greater degree not= =20 just in the short term to buy power to keep the lights on. I'm talking abou= t=20 basically socializing the energy business.=20 Jones said he prefers low-interest loans to Edison and PG&E taking the=20 electric grid as collateral.=20 I just do not believe in California getting into something it does not kno= w=20 how to do -- has never done before -- on top of all of our other=20 obligations he said.=20 It really worries me that California will not be able to endure that type = of=20 obligation.=20 Jones said polls now show increasing numbers of residents saying the state = is=20 headed in the wrong direction.=20 I feel obligated to speak out and say there is a better way Jones said. --- --- Day 2 -- Battling blackouts: Payment plan sought to restart small plants By Dale Kasler and Carrie Peyton Bee Staff Writers (Published March 21 2001)=20 Blackouts rolled across California for a second straight day Tuesday=20 snarling traffic darkening businesses and sending state officials scrambli= ng=20 to craft a payment plan to revive the wind farms and other critically neede= d=20 small energy producers that have shut down because of financial woes.=20 On a day when another 570000 customers lost power Gov. Gray Davis said th= e=20 Public Utilities Commission and the Legislature would move promptly to orde= r=20 Pacific Gas and Electric Co. and Southern California Edison to start paying= =20 those small energy producers for their electricity. Davis said the two=20 utilities will face considerable fines if they don't pay up.=20 But several of the producers known as qualifying facilities said they= =20 doubted Davis' plan would go far enough to get them back in operation. And = it=20 wasn't clear whether the plan would keep the increasingly impatient=20 alternative producers from hauling one or both of the big utilities into=20 bankruptcy court as some have threatened.=20 The shortage of power from the qualifying facilities -- plus a near-record= =20 heat wave (downtown Sacramento topped off at 83 degrees one degree short o= f=20 the 84 degree record set in 1960) a lack of hydropower and other problems = --=20 prompted the state's Independent System Operator to order a second day of= =20 blackouts starting mid-morning. But the blackouts hit only about half as ma= ny=20 Californians as Monday's with late afternoon conservation efforts helping= =20 balance supply with demand.=20 The blackouts usually about an hour long hit about 7600 Sacramento=20 Municipal Utility District customers in Elk Grove and south Sacramento=20 County. PG&E customers in suburban counties were affected as well.=20 The order darkened shops in San Francisco's Chinatown and was blamed for a= =20 crash that left two motorists seriously injured in the Los Angeles suburb o= f=20 South El Monte. A Sun Microsystems Inc. factory in Newark had to close for= =20 several hours.=20 Most Californians took the blackouts in stride though. Elk Grove High Scho= ol=20 students filed outside to play hacky sack. Coffee shop patrons in Davis=20 milled outdoors enjoying the unseasonably warm weather.=20 Yet the blackout order was met with outright defiance by one municipal=20 utility. The city of Lodi refused to cut power to its residents Monday or= =20 Tuesday saying it shouldn't have to suffer because of the financial crisis= =20 afflicting PG&E and Edison.=20 The outlook for today and the near future was brighter as several big powe= r=20 plants came back on line after repairs. ISO officials also praised=20 Californians' conservation efforts which had faltered in the morning but= =20 came on strong in the afternoon helping to prevent further blackouts. By= =20 evening the grid was in a relatively mild Stage 2 power alert.=20 But the second day of blackouts -- plus an increasing threat of utility=20 bankruptcy -- pushed Davis to the brink. The governor cobbled together a=20 payment plan to rescue the qualifying facilities -- some 600 wind farms=20 geothermal plants and other alternative-energy generators whose production= =20 has become increasingly vital in recent days.=20 Under Davis' plan the Legislature and the PUC would order PG&E and Edison = to=20 pay the qualifying facilities for power delivered after April 1. The=20 utilities are required to buy power from the qualifying facilities under a= =20 1978 federal law designed to bring cheaper and cleaner forms of electricity= =20 to market.=20 Davis said the PUC would release a proposed order late Tuesday that would= =20 require the utilities to pay the qualifying facilities $79 a megawatt hour= =20 for five-year contracts or $69 for 10-year contracts. The Legislature also= =20 would have to pass a law authorizing the PUC to issue such an order.=20 But the situation was far from resolved late Tuesday and PG&E and Edison= =20 were likely to oppose at least portions of Davis' plan.=20 Edison is willing only to make some kind of partial payments going forward= =20 said Thomas Higgins a senior vice president with parent company Edison=20 International. We have a limited amount of resources available to us in=20 rates ... and that's the constraining factor.=20 PG&E which has been making partial payments to the qualifying facilities= =20 said it could pay them in advance in full for future power deliveries.=20 But PG&E said such payments would eat up half the $400 million it has=20 available each month to buy power -- and unless it gets a rate hike there= =20 wouldn't be enough to pay the qualifying facilities and cover other expense= s=20 including the cost of reimbursing the state Department of Water Resources f= or=20 the power the agency is buying on behalf of the troubled utility.=20 PG&E's proposal could represent a challenge of sorts to state officials:=20 Accept less money for the water department or raise rates.=20 State officials need to resolve who they want to see paid PG&E spokesman= =20 John Nelson said. There is a limited pool of money.=20 For his part Davis insisted that the water department would be first in li= ne=20 to be paid and he said the PUC will issue a proposed order to that effect.= =20 We are getting paid before anybody else Davis said.=20 Hundreds of qualifying facilities are out of commission because PG&E and=20 Edison haven't paid them. The situation has robbed the state of several=20 thousand badly needed megawatts and is a key reason blackouts have been=20 ordered. In normal times the facilities produce more than 20 percent of=20 California's electricity.=20 Some of the qualifying facilities have been threatening to haul one or both= =20 of California's beleaguered utilities into bankruptcy court unless they get= =20 paid soon saying a bankruptcy filing might be the only way they can save= =20 their businesses.=20 You've got to take care of the QF problem or the whole thing blacks out= =20 said Jerry Bloom a lawyer representing one group of qualifying facilities.= =20 (State officials) are starting to understand.=20 One thing that was fairly certain about Davis' still-sketchy payment plan: = It=20 wouldn't cover PG&E and Edison's existing debt to the qualifying facilities= =20 estimated at more than $1.48 billion.=20 In their current financial state the utilities say they can't afford to pa= y=20 the existing debt. In addition paying the debt would create a major=20 complication: Other creditors including the big power generators would=20 surely haul Edison and PG&E into bankruptcy court on the grounds that they= =20 weren't being treated fairly.=20 You can't give preferential payment treatment to one class of creditors ov= er=20 another PG&E's Nelson said. You virtually assure that (the other=20 creditors) have to file an involuntary bankruptcy proceeding against you.= =20 But without full payment it wasn't clear how many of the qualifying=20 facilities would be able to restart.=20 Executives at several plants -- the ones that run on natural gas -- said=20 they're not sure their gas suppliers will deliver unless the existing debts= =20 are cleared up.=20 We need to convince a gas company to supply us said Ed Tomeo of UAE Ener= gy=20 Operations Corp. which had to shut off its 40-megawatt Kern County plant= =20 Tuesday. We're a company that already owes millions of dollars for gas=20 supplies. How do you coax them to sell you millions more?=20 It's wishful thinking ... that the gas suppliers are going to sell us gas= =20 Robert Swanson of Ridgewood Power said.=20 I>Bee Capitol Bureau Chief Amy Chance and staff writers Stuart Leavenworth= =20 Bill Lindelof Pamela Martineau and the Associated Press contributed to thi= s=20 report. --- --- Lodi still won't pull the plug By Carrie Peyton Bee Staff Writer=20 (Published March 21 2001) In a growing rebellion against blackouts the city of Lodi has twice refuse= d=20 to cut power to its residents despite an order from Pacific Gas and Electri= c=20 Co.=20 The small city-run electric system is among many disgruntled utilities=20 including the Sacramento Municipal Utility District that believe their=20 contractual pledges to cut back during emergencies were never meant for tim= es=20 like this.=20 It's been a philosophical debate up to this point. Now I guess we've drawn= a=20 line in the sand said Lodi utility director Alan Vallow.=20 PG&E said it is reviewing its interconnection contract the agreement that= =20 links Lodi to the grid through PG&E-owned high-voltage lines to determine= =20 what action it will take next.=20 It's unfortunate that while the city of Lodi has received the benefit of= =20 this agreement for years they are unwilling to bear the burden of this=20 statewide energy shortage said PG&E's Jon Tremayne.=20 One utility coalition the Northern California Power Agency believes that= =20 PG&E has already violated that agreement by not lining up enough power for= =20 customers.=20 The agency wrote PG&E on Friday saying that its members -- municipal=20 utilities and irrigation districts -- believe they aren't required to=20 participate in blackouts prompted by financial disputes.=20 And SMUD which has been considering dropping out of future blackouts will= =20 be watching the response to Lodi said SMUD board President Larry Carr.=20 Some SMUD directors say they're ready to go to court to force the issue. So= =20 is Lodi population 58000 said Vallow.=20 I've heard an Edison executive describe this as a natural disaster akin to= =20 an earthquake. That's crap. This is a man-made event he said.=20 Lodi said it will still help in genuine emergencies such as fires or toppl= ed=20 transmission lines. But it decided that on Monday and Tuesday that wasn't t= he=20 case.=20 You have 3000 megawatts of QFs (qualifying facilities) offline because=20 their bills haven't been paid. Well guess what? Somebody ought to pay thos= e=20 ... bills Vallow said. --- --- Blackouts hit for second day break seen Wednesday=20 By Audrey Cooper ASSOCIATED PRESS=20 March 20 2001=20 SACRAMENTO =01) Rolling blackouts hit California for a second straight day= =20 Tuesday closing souvenir shops in San Francisco's Chinatown snarling=20 traffic and plunging schools and offices around the state into darkness.=20 Roughly a half-million homes and businesses from San Diego to the Oregon=20 border faced outages blamed on the same factors that collided to force=20 blackouts Monday =01) unseasonably warm weather reduced electricity import= s=20 from the Pacific Northwest numerous power plants offline for repairs and= =20 less power provided by cash-strapped alternative-energy plants.=20 Five rounds of outages in San Diego affected about 74000 customers. State= =20 power grid officials expected to have enough electricity to avoid further= =20 outages through at least Wednesday although the supply remained tight.=20 State power regulators working on energy rescue=20 Federal regulators scored for not ordering more California refunds=20 ?=20 Gov. Gray Davis blamed the blackouts in part on the failure of Southern=20 California Edison and Pacific Gas and Electric Co. to pay millions of dolla= rs=20 they owe qualifying facilities power suppliers that use cogeneration =01= )=20 steam from manufacturing plus natural gas =01) or solar wind and other=20 renewable energy to generate electricity.=20 State power grid officials say California this week has lost about half the= =20 electricity QFs normally provide. Several cogeneration plants say they=20 haven't been paid by Edison and PG&E for weeks and can't afford to buy=20 natural gas to fuel their plants.=20 Davis said the utilities are taking in money from customers but still faili= ng=20 to pay the QFs. The state has been spending about $45 million a day since= =20 January to buy power for customers of Edison and PG&E which are so=20 credit-poor that suppliers refuse to sell to them.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators Davis said at a Capitol news conference Tuesday evenin= g.=20 They've acted irresponsibly and immorally and it has to stop.=20 Southern California Edison officials said in a written statement that the= =20 utility is intent on paying creditors and working with the PUC to pay QFs f= or=20 future power sales. PG&E representatives were out of the office late Tuesda= y=20 night and didn't immediately return calls from The Associated Press seeking= =20 comment.=20 John Harrison of the Northwest Power Planning Council a consortium that=20 monitors power use in several Western states said blackouts on the first d= ay=20 of spring are an ominous sign of what lies ahead this summer.=20 We're in trouble he said. We will likely be able to meet our needs this= =20 summer but there won't be much to send to California.=20 Tuesday's outages began at 9:30 a.m. PST and continued in 90-minute waves= =20 until about 2 p.m. when the Independent System Operator lifted its blackou= t=20 order.=20 Grid officials credited an influx of power from the Glen Canyon hydroelectr= ic=20 plant on the Utah-Arizona border.=20 The blackouts were blamed for at least one serious traffic accident.=20 Two cars collided at an intersection without traffic lights in the Los=20 Angeles suburb of South El Monte leaving two people with serious injuries= =20 California Highway Patrol Officer Nick Vite said.=20 Ventura Foods in Industry sent its employees out for an early lunch after= =20 blackouts shut down its phones and computers.=20 This is mild weather for this time of year. I don't know what's going to= =20 happen in the summer manager Frank Hynes said. This is going to have a= =20 serious impact on the state's economy. They can't just keep shutting people= =20 down.=20 Statewide demand was higher than expected because of warm spring weather.= =20 Temperatures reached record highs across California on Monday including th= e=20 80s and low 90s in Southern California. They were expected to be somewhat= =20 lower Tuesday but still in the 70s and 80s.=20 The ISO hoped demand would start to subside and conservation would kick in= =20 but that did not happen Tuesday morning.=20 We have not seen the kind of conservation we saw back in January when th= e=20 first blackouts hit ISO spokesman Patrick Dorinson said. If we don't have= =20 conservation efforts that just means that's more power we have to take off= =20 the grid.=20 In San Francisco's Chinatown souvenir shops normally bustling with visitor= s=20 were forced to shut down. Nearby irritated customers waited for a bank to= =20 reopen.=20 It's no good for anybody =01) stores or businesses or people said Yin Su= n=20 Chan among those in line.=20 PG&E the state's largest utility accounted for most of the customers=20 affected.=20 At least 438000 PG&E residential and business customers were affected as o= f=20 early afternoon spokesman Ron Low said.=20 Edison cut power to about 50000 customers. Edison was ordered to cut less= =20 power than PG&E and saved some due to conservation programs including one= =20 that lets the utility shut off air conditioning for 118500 residential and= =20 business customers when the power supply is tight.=20 About 73400 San Diego Gas & Electric customers were hit by the blackouts.= =20 Los Angeles whose municipal utility is not on the grid that serves most of= =20 California wasn't included in the blackout order.=20 More than 1 million homes and businesses statewide experienced outages=20 Monday.=20 California's power crisis is expected to get even worse this summer when= =20 temperatures soar and residents crank their air conditioning.=20 Natural gas supplies are tight water supplies are down and the state is=20 spending tens of millions of dollars each day to buy electricity for Edison= =20 and PG&E who say they are nearly bankrupt due to high wholesale power cost= s.=20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices the state's 1996 deregulation law=20 prevents them from recouping from ratepayers.=20 Adding to the problems the state this week lost about 3100 megawatts from= =20 QFs. One megawatt is enough power to serve about 750 households.=20 The plants say they are owed about $1 billion for past sales to PG&E and=20 Edison.=20 PG&E said it is offering to prepay the QFs starting next month to get them= =20 back in operation. Negotiations were expected to continue Wednesday.=20 California Co-Generation Council attorney Jerry Bloom said he supports=20 proposals that will get the Qfs paid but the promise of future payments ma= y=20 not be enough.=20 PG&E and Bloom said the utility's prepayments hinge on an upcoming Public= =20 Utilities Commission decision on whether the utility's rates are sufficient= =20 to pay its bills and cover the state's power purchases on its behalf which= =20 amount to $4.2 billion since early January.=20 Davis said the PUC planned to issue a draft order late Tuesday directing th= e=20 utilities to pay their future QF bills.=20 It plans to take action on that order next Tuesday Davis said. The=20 Legislature plans to approve a bill in the meantime giving the PUC the=20 authority to issue such an order and fine the utilities if they fail to=20 comply he said.=20 Davis said he is confident the utilities and the state can pay their bills= =20 without further rate increases for Edison and PG&E customers.=20 --- --- State power regulators working on energy rescue=20 By Karen Gaudette ASSOCIATED PRESS=20 March 20 2001=20 SAN FRANCISCO =01) State power regulators continue to delay the release of= =20 guidelines that will determine a portion of the money the Department of Wat= er=20 Resources can recoup from financially troubled utilities for electricity it= =20 has bought on their customers' behalf.=20 These guidelines will help the water department determine whether it must= =20 raise consumer power rates to reimburse the state for the more than $3=20 billion it has committed to buying electricity.=20 Assemblyman Fred Keeley D-Boulder Creek said Tuesday that the Public=20 Utilities Commission would likely have to raise rates by 15 percent to cove= r=20 the state's costs and the utilities' bills.=20 The PUC guidelines were most recently delayed by a letter from DWR Director= =20 Thomas Hannigan asking that the water department receive a percentage of=20 ratepayer money collected by the utilities equal to the percentage of=20 electricity it provides to utilities.=20 The DWR currently buys around 40 percent of the power used by Pacific Gas a= nd=20 Electric Co. Southern California Edison Co. and San Diego Gas and Electric= .=20 Under the DWR's proposal the utilities would have to hand over 40 percent o= f=20 the money they continue to collect from ratepayers.=20 The DWR would then also receive whatever money remains after the utilities= =20 subtract their own generation and long-term contract costs the letter said= .=20 That amount would become the California Procurement Adjustment =01) an am= ount=20 that will help the state retrieve money spent on power purchases and help= =20 establish the size of state revenue bonds that are currently estimated to= =20 total $10 billion.=20 The state plans to issue the bonds in May to help pay off the more than $3= =20 billion Gov. Gray Davis' administration has committed to power purchases=20 since January to help the utilities climb out of debt.=20 Ron Low a spokesman with PG&E said the utility objects to paying the DWR= =20 such a large sum claiming it would interfere with efforts to pay its=20 qualifying facilities =01) power plants that use the sun wind biomass o= r=20 natural gas to generate about one third of the state's electricity.=20 The nearly bankrupt utilities owe the QFs more than $1 billion for=20 electricity they have produced since November said Jan Smutney-Jones=20 executive director of the Independent Energy Producers.=20 Hannigan also said in the letter the DWR intends to use its authority to=20 raise consumer electricity rates to recoup any money not reimbursed through= =20 the CPA and other means.=20 The Public Utilities Commission expected to release the guidelines last wee= k=20 but was delayed by debates over legislation that would slash the rates of= =20 environmentally friendly power plants under contract to provide electricity= =20 to the investor-owned utilities.=20 Without knowing how much ratepayer money the utilities need to pay these=20 qualifying facilities for future electricity it's unknown how much money= =20 they'll have on hand to pay the DWR.=20 In a written statement PUC Administrative Law Judge Joseph DeUlloa said th= at=20 he would issue a temporary decision on the CPA as soon as is practical.= =20 Pacific Gas and Electric Co. and Southern California Edison Co. say they ha= ve=20 lost more than $13 billion since last June to climbing wholesale electricit= y=20 prices that the state's 1996 deregulation law prevents them from recouping= =20 from ratepayers.=20 --- --- Federal regulators scored for not ordering more California refunds=20 By H. Josef Hebert ASSOCIATED PRESS=20 March 20 2001=20 WASHINGTON =01) House Democrats asked federal energy regulators Tuesday why= they=20 are not going more aggressively after alleged overcharges for wholesale=20 electricity in California and ordering more refunds.=20 The Federal Energy Regulatory Commission has asked suppliers to justify $12= 4=20 million in sales during the first two months of the year or refund the mone= y=20 but critics charge that thousands of additional questionable sales are not= =20 being challenged.=20 The three commissioners testifying at a hearing of the House Commerce=20 subcommittee on energy were asked why they limited their refund demands to= =20 only power sales that occurred during so-called Stage 3 alerts of acute pow= er=20 shortages in California.=20 It appears to me a price is unreasonable when it is unreasonable and not= =20 just during a power alert said Rep. Rick Boucher of Virginia the panels'= =20 ranking Democrat.=20 The commission last week ordered six power generators to justify some 1000= =20 transactions during February in the California market whenever the price wa= s=20 above $430 per megawatt hour and occurred during a Stage 3 emergency alert.= =20 But the lawmakers were told Tuesday that 56 percent of another 14168=20 transactions occurring outside a Stage 3 emergency also exceeded the $430= =20 trigger but are not being questioned.=20 The line was drawn to limit the scope of the refund said agency=20 commissioner William Massey a Democrat who strongly opposed the refund=20 actions because he said they were too limited.=20 Chairman Curtis Hebert a Republican defended the way the commission decid= e=20 on what transactions to challenge saying that it sought to replicate market= =20 conditions as they existed at the time of the sales.=20 We deserve a better explanation retorted Boucher.=20 Massey said that agency's investigation of overcharges for January also=20 failed to consider thousands of transactions that exceeded the refund trigg= er=20 because they did not occur during Stage 3 supply emergencies.=20 Managers of California's electricity grid state regulators and utilities= =20 have accused the agency of refusing to aggressively investigate price gougi= ng=20 by wholesalers who have charged from $150 to $565 per megawatt hour as muc= h=20 as 20 times what prices were in 1999.=20 While Hebert and commissioner Linda Breathitt defended the commissioners=20 attempt to investigate whole electricity prices Massey has been highly=20 critical.=20 What message does the agency's scrutiny of prices send to the power=20 companies? he was asked.=20 It makes clear FERC is going to be looking for the wallet under the lamp= =20 post with the lights shining =01) and nowhere else replied Massey.=20 Meanwhile Massey and his two fellow commissioners also disagreed sharply = on=20 whether the energy agency should impose temporary price controls on the=20 wholesale power market in the West to dampen further expected price increas= es=20 this summer.=20 Massey said he fears a disasters in the making if some price restraints a= re=20 not imposed by FERC which regulates wholesale electricity sales. We need = a=20 temporary time out he said.=20 But Massey is in the minority on the commission. Both Hebert and Breathitt= =20 are against price caps arguing they will have long-term detrimental impact= =20 on power supply.=20 The Bush administration has made its opposition to interfering in the=20 wholesale markets well known for weeks. Vice President Dick Cheney's task= =20 force is to unveil an energy plan in about a month that is expected to lean= =20 heavily on energy production.=20 --- --- Second Day of Blackouts Disrupts 500000 Homes and Businesses=20 Power: Grid operators say the shortage should ease in the next few days bu= t=20 officials see a grim summer.=20 By MITCHELL LANDSBERG and ERIC BAILEY Times Staff Writers=20 A traffic signal that stopped working during Tuesday's rolling blackouts le= d=20 to this collision be tween a car and a truck at an intersection in El Monte= .=20 The outages ran from 9:30 a.m. to 2 p.m. AP ?????Electricity blackouts rolled through California for a second straight= =20 day Tuesday disrupting business in one of the world's most technologically= =20 advanced economies and leaving schoolchildren groping in the dark. ?????Jinxed by a combination of bad luck and bad decisions utilities were= =20 forced to cut off power to more than half a million homes and businesses fr= om=20 San Diego to the Oregon border. ?????By day's end there was some good news from the operators of the=20 statewide power grid who said the situation had eased and appeared likely = to=20 improve for the next few days. And Gov. Gray Davis announced a proposed=20 solution to one vexing problem: the utilities' failure to pay the state's= =20 small alternative power generators many of whom have stopped producing=20 power as a result. ?????Davis called the utilities shameful for failing to pay and praised= =20 the alternative power generators which include solar wind and geothermal= =20 energy producers as good corporate citizens who produced power although= =20 they weren't being paid. ?????We are anxious to pay the [small producers] who are dropping like=20 flies Davis said. ?????Despite the progress it was hard for some people to look on the brigh= t=20 side after enduring outages that took place when the state's hunger for pow= er=20 was almost 50% less than at its summer peak. ?????This is a taste almost like an appetizer of a really unpalatable me= al=20 that's going to be served up this summer said Michael Shames of the Utili= ty=20 Consumers' Action Network in San Diego himself a victim of a rolling=20 blackout that hit his office in San Diego early Tuesday. ?????Power officials have warned that this could be a grim summer in=20 California since demand for electricity sharply rises when people turn on= =20 air conditioners. The state has been struggling to meet its power needs in= =20 recent months because of rising prices and a flawed deregulation plan that= =20 has left the two biggest private utilities on the brink of bankruptcy. Stat= e=20 leaders have so far failed to agree on a comprehensive plan to solve the=20 problems. Wally Quirk teaches a business class in a borrowed classroom Tuesday at=20 Sonoma State after the state's rolling blackouts cut the power to his usual= =20 classroom which does not have any windows. SCOTT MANCHESTER / The Press Democrat ?????The latest round of blackouts began about 9:30 a.m. Tuesday when the= =20 California Independent System Operator which runs the statewide grid=20 determined that the demand for electricity was 500 megawatts more than the= =20 supply--an imbalance that meant the state was short on the power needed to= =20 supply electricity to about 375000 homes. ?????Grid operators blamed a confluence of events including warmer weather= =20 outages at several major power plants including one unit of the San Onofre= =20 nuclear power station a reduction in imports from the Pacific Northwest a= nd=20 the shutdown of many alternative energy producers. Similar blackouts Monday= =20 were the first since January. ?????The situation improved somewhat by late Tuesday morning with some=20 supplies restored and Californians conserving energy and Cal-ISO was able = to=20 halt the rolling blackouts at 2 p.m. ?????Once again customers of the Los Angeles Department of Water and Power= =20 were spared although the municipally owned utility said its electrical=20 surplus was smaller than usual. The DWP like Southern California Edison w= as=20 affected by an outage at the huge Mohave power plant in Nevada as well as = by=20 planned outages at several of its facilities. ?????As in the past by far the biggest impact was felt by customers served= =20 by Pacific Gas & Electric the state's largest utility which cut power to= =20 438000 homes and businesses. ?????Edison cut power to 47462 customers in about 40 cities but eventuall= y=20 was able to avoid blackouts by shutting off the air conditioners of some of= =20 the 118500 customers who participate in a voluntary cutoff program. ?????San Diego Gas & Electric cut power to 73400 customers. ?????Innovative Ways of Coping ?????As on Monday most people took the outages in stride as an annoying b= ut=20 ultimately unavoidable inconvenience. ?????In Palmdale four schools lost power during one of the hourlong=20 blackouts but teachers and students pressed on in the sunlight pouring=20 through windows and skylights. At Barrel Springs Elementary Principal Cruz= =20 Earls said the biggest problem came when students had to go to the bathroom= :=20 Hand in hand they made their way through darkened hallways with flashlight= s. ?????All in all it wasn't a terrible experience. Then again the weather= =20 wasn't that hot Tuesday with a high of 79 in Palmdale so the shutdown of= =20 air conditioners wasn't much of a hardship. I don't want to think about th= e=20 conditions this could create in May or June Earls said. ?????Businesses of all kinds complained about the lack of warning for the= =20 outages--and sometimes found innovative ways to get around the problem. ?????Rattled by news reports of Monday's rolling blackouts El Burrito=20 Mexican Food Products in the city of Industry started its Tuesday shift at = 2=20 a.m. to beat the clock in the event of an outage. That hunch paid off.=20 Workers had just finished cooking and packaging the last batches of salsa a= nd=20 masa when the lights went out at 10:20 a.m. ?????Company owner Mark Roth said the firm will continue working odd hours = to=20 avoid further outages. But he isn't buying the line from the utilities that= =20 they can't provide advance warning because of concerns about looting and=20 rioting. ?????We're ready to do whatever it takes to get through this thing he=20 said. But they've got to give us some notification. ?????At Big O Tires in Elk Grove just south of Sacramento owner Daniel Cr= um=20 had his 14 workers take an early lunch break or head to the warehouse to=20 reorganize the goods. Without electricity they couldn't repair brakes or= =20 align front ends. ?????I'd never let them be idle said Crum. ?????At least two minor traffic accidents were blamed on the outages. ?????The blackouts resulted from a convergence of factors. ?????Demand was slightly higher than expected probably because of=20 unseasonably warm weather. Supplies were tighter than usual in part becaus= e=20 of several outages including that at the Mohave plant half of which was= =20 brought back on line by the end of the day. ?????The San Onofre Nuclear Generating Station was still limping along=20 without power from one of its two 1100-megawatt units which was shut down= =20 Feb. 3 after a half-hour fire in a nonnuclear part of the plant. Edison=20 which operates San Onofre initially estimated the unit would be out for=20 several weeks but recently said extensive damage to parts of the turbine= =20 will keep the unit out of commission until mid-June. ?????Shipments from the drought-stricken Pacific Northwest which generates= =20 most of its electricity from large dams were also down. ?????Each time we take a measurement we're closer to the all-time record= =20 for the driest year said Dulcy Mahar spokeswoman for the Bonneville Powe= r=20 Administration the network of federal dams that provides the region with= =20 much of its electricity. We've been doing what we can but we simply don't= =20 have power to sell. ?????Finally there was the problem of the small and alternative energy=20 producers which have shut down plants because they haven't been paid by th= e=20 private utilities since November. Those outages have cost the state about= =20 3000 megawatts of electricity enough for about 2.3 million homes. ?????You're seeing the system freeze up said David Sokol chairman and C= EO=20 of MidAmerican Energy Holdings Co. which runs eight geothermal plants in t= he=20 Imperial Valley through its subsidiary CalEnergy. His company hasn't shut= =20 down yet but Sokol said smaller companies couldn't continue to sell their= =20 energy to utilities for free. ?????Why should we fund Edison? he asked. That's just ridiculous. ?????A Choice of 2 Rate Plans ?????Davis joined lawmakers in the Capitol on Tuesday to outline his plan t= o=20 get the producers running again. He said utilities have had no right to=20 collect money from ratepayers and then not use the funds to repay the small= =20 producers. The state has spent billions to buy power from large conventiona= l=20 producers on behalf of the utilities but has refused to pick up the tab for= =20 alternative energy. ?????The utilities acted in a shameful manner by putting money in their=20 pockets that was designed to pay the [small producers] Davis said. ?????The plan outlined by Davis would allow the generators to choose betwee= n=20 two rate plans. They could decide to be paid 7.9 cents per kilowatt-hour ov= er=20 five years or 6.9 cents a kilowatt-hour over 10 years. ?????The utilities must begin paying the generators the new rates beginning= =20 April 1 or face fines Davis said. ?????The question of how the companies will get paid the about $1.5 billion= =20 they are owed remains unresolved. That issue will be decided in coming week= s=20 as Davis' negotiators continue to work on rescue plans for the state's=20 financially hobbled private utilities. ?????PG&E spokesman Ron Low said the state's largest utility did not take= =20 kindly to Davis' criticism and noted that the governor's plan is similar t= o=20 a proposal that PG&E made last week to producers. ?????Jan Smutny-Jones executive director of a trade group that includes so= me=20 of the small generators described the plan as a positive step. ?????The governor got it right in that it's not acceptable for small power= =20 producers to continue to generate and not be paid Smutny-Jones said. But= =20 we'll need to see what the order says the devil will truly be in the=20 details. ?????Grid operators said the state's overall energy situation eased by midd= ay=20 Tuesday because of repairs at the Mohave plant and another large plant at= =20 Ormond Beach and because the Western Area Power Administration came up wit= h=20 300 megawatts of electricity from Glen Canyon Dam. ?????Also grid spokesman Patrick Dorinson said conservation savings spiked= =20 upward after earlier complaints that Californians weren't conserving. ?????We saw the people of California probably conserve 900 megawatts today= =20 he said. That was probably the difference. ---=20 ?????Times staff writers Andrew Blankstein Jose Cardenas Marla Dickerson= =20 Noaki Schwartz Nicholas Riccardi Doug Smith Rebecca Trounson and Richard= =20 Winton in Los Angeles Miguel Bustillo and Julie Tamaki in Sacramento Mari= a=20 La Ganga in San Francisco Stanley Allison Matt Ebnet Scott Martelle=20 Dennis McLellan Monte Morin Jason Song Mai Tran and Nancy Wride in Orang= e=20 County and Richard Simon in Washington contributed to this story. --- --- Fragile Supply Network Apt to Fail=20 By JENIFER WARREN and ERIC BAILEY Times Staff Writers=20 ?????A lot of people were caught off guard by the blackouts that swept over= =20 California this week. Debra Bowen wasn't one of them. ?????As chairwoman of the state Senate Energy Committee she is=20 intimately--and painfully--familiar with the state's energy supply. And she= =20 is willing to share a secret: It's a fragile system capable of collapse at= =20 any time. ?????That knowledge keeps Bowen awake at night particularly with the=20 approach of summer when power demand surges as Californians get reacquaint= ed=20 with their air conditioners. ?????I sound a bit less like Chicken Little today don't I? Bowen said=20 Tuesday as chunks of the state once again were forcibly darkened. I know = a=20 lot of people don't feel we have a problem. But we have a very very big=20 problem. ?????With the recent slowdown in Stage 3 emergencies a sense of calm had= =20 settled over the energy debate and even some legislators were speaking wit= h=20 guarded optimism about the hot months ahead. ?????On Tuesday however a creeping sense of doom was almost palpable amon= g=20 energy watchers and previous supply forecasts--which predict that the stat= e=20 may yet escape summer blackouts--were being given a second look. ?????The outages of the last two days are something that Californians are= =20 going to have to get used to for July and August said Michael Zenker=20 California director of Cambridge Energy Research Associates. The=20 Massachusetts consulting firm is predicting about 20 hours of blackouts thi= s=20 summer. ?????At the California Independent System Operator which manages 75% of th= e=20 statewide power grid officials said the energy cushion the state had in=20 recent weeks was in some ways a phantom caused by heavy imports of power. ?????Cal-ISO spokesman Patrick Dorinson said people may have been deluded= =20 into a false state of comfort: Maybe there is a tendency to think things= =20 have improved he said. In fact they haven't. ?????More than anything this week's events illustrate the delicate balance= =20 of factors that keep California illuminated from the multitude of supply= =20 sources to the weather. ?????Temperatures were higher than usual. Alternative-energy suppliers--who= =20 haven't been paid in months by the cash-strapped utilities--cut their outpu= t.=20 Suppliers in the Northwest--which faces a drought--slashed exports. Equipme= nt=20 breakdowns and maintenance at power plants--much of it unanticipated--took= =20 13000 megawatts offline. A utility-run program that gives businesses=20 discounts in exchange for cutting power during emergencies is all but dead. ?????The fragility of the system is such that a small perturbation can tur= n=20 everything upside down very easily said Gary Ackerman executive director= =20 of the Western Power Trading Forum a group of electricity generators and= =20 traders. ?????One factor receiving particular attention is the dip in supply caused = by=20 unscheduled maintenance. To help officials predict available supply=20 generators provide an annual maintenance plan that is updated regularly. ?????In addition however facilities sometimes shut down for unexpected=20 reasons: leaking tubes burnt-out transformers cracked turbines and faulty= =20 feed pumps. At one point Tuesday about 8200 megawatts were unavailable=20 because of unscheduled shutdowns. That's enough to supply about 6 million= =20 households and up from 5700 megawatts a week ago. ?????The huge 1400-megawatt Mohave power plant near Laughlin Nev. which= =20 supplies Southern California Edison and the Los Angeles Department of Water= =20 and Power was felled Monday by a transformer problem. That was enough to= =20 push the state into blackouts. ?????A growing number of skeptics however question whether those reasons= =20 are always valid accusing generators of withholding power to shrink supply= =20 and drive up prices. ?????There's no way to verify it so you've got to take their word for it= =20 said Frank Wolak a Stanford University economist who studies California's= =20 electricity market. And given that it's very profitable for these things t= o=20 occur you start to wonder if they're creating an artificial scarcity. ?????Tom Williams of Duke Energy said the Houston-based company is working= =20 hard to keep its California power plants which are capable of producing=20 3351 megawatts of electricity in operation after months of near-continuou= s=20 operation. ?????It's like riding a moped across the country he said. They're just= =20 not meant to run this hard. ?????Last week the state Senate formed a committee to investigate charges = of=20 market manipulation by power suppliers. The chairman state Sen. Joe Dunn= =20 (D-Santa Ana) says the issue of unscheduled plant shutdowns is on his agen= da. ?????The problem is: How does one prove that a particular outage was part = of=20 a deliberate strategy to deprive the state of kilowatts rather than a resu= lt=20 of normal business operations? Dunn said. ---=20 ?????Times staff writer Nancy Rivera Brooks contributed to this story. --- --- Elevator Anxiety Is Riding High=20 Emergencies: Workers in skyscrapers worry about blackouts trapping them in= =20 their buildings. Some take the risk in stride others make plans to take th= e=20 stairs.=20 By JOHN M. GLIONNA and JOE MOZINGO Times Staff Writers=20 ?????SAN FRANCISCO--In Susan Clifton's highly placed opinion sunny Tuesday= =20 would have been a picture-perfect day to work atop one of the tallest=20 buildings in San Francisco a scenic city littered with soaring skyscrapers= . ?????But Clifton--like many other high-rise office dwellers in blackout-pro= ne=20 parts of California--couldn't help but feel some high anxiety at the prospe= ct=20 of being stranded by electrical outages that were sweeping across the state= =20 for a second day. ?????I think about it all the time said Clifton a 21-year-old=20 receptionist at Deutsche Bank's offices on the 48th floor of a tower in the= =20 city's financial district who recently moved from rural Virginia. The way = I=20 see it Californians take a lot of things on faith working atop tall=20 buildings with all these earthquakes and power outages. ?????For Long Beach office worker Dave Suhada the anxiety has taken the fo= rm=20 of elevator phobia: a fear of getting stuck on an 80-degree day crammed in = a=20 pod of sweating heavy-breathing humans with no way out. ?????I'm just eyeing the buttons to see which one I could push as fast as = I=20 can if the power goes out he said.=20 ?????For 20-year-old Lisa Riley it means entering the elevator each day in= =20 her Long Beach office building with a prayer. I just could not get stuck f= or=20 an hour and a half she said nodding nervously. Often she now opts for th= e=20 stairs. ?????In San Francisco emergency services officials say that most of the=20 city's office buildings are equipped with backup generators to run elevator= s=20 and security equipment in the event of a blackout. ?????Fire Department spokesman Pete House said the city has 19 trucks with= =20 experts trained to extricate people trapped in elevators. Firefighters=20 handling blackout-related emergencies rescued a person trapped in a downtow= n=20 building Tuesday and handled five elevator mishaps Monday. ?????Christopher Stafford didn't get caught inside an elevator Monday but= =20 suffered the next-worst thing: being stranded in his 15th-floor apartment= =20 after the power failed when he went home for lunch. ?????So the 41-year-old real estate worker trooped down the stairs to the= =20 lobby and even made some new friends along the way helping a few elderly= =20 women who were struggling down the stairs. ?????It was a pain he acknowledged. But I have to tell you: I really li= ke=20 my panoramic view so it's worth the hassle. ?????Nowadays Sherrie Tellier makes sure her cellular phone is in hand whe= n=20 she gets in the elevator. She got trapped once before and the emergency=20 phone didn't work. It's amazing she said how small an elevator seems when= =20 you can't get out. It's like a broom closet.Now there's a sigh of relief= =20 every time the door opens. ?????Some high-rise office workers said Tuesday that they preferred not to= =20 think about the perils of going without power and being vulnerable and=20 isolated so high up. ?????But on the 42nd floor of San Francisco's Transamerica Tower Sasha=20 Monpere wasn't fazed by the chance that during a blackout her building's= =20 backup generators wouldn't kick in. ?????Hey I'm young and I'm healthy. I can always walk down the stairs= =20 said the 29-year-old receptionist. I've done the Statue of Liberty. It can= 't=20 be any worse than that. And walking down 42 flights is a lot easier than=20 walking up all those stairs. ?????Likewise with Phil Ip who works on the 52nd--and top--floor of San=20 Francisco's tallest skyscraper. The 25-year restaurant veteran says he has= =20 the utmost faith in modern technology. ?????We're safe even up here said Ip assistant general manager of the= =20 Carnelian Room a restaurant atop the Bank of America building. You should= =20 see the engineer's room in this building. It's like a big steamship. They'r= e=20 equipped for anything that could happen. ?????One floor below Cheryl Martin hears every day about people's fear of= =20 heights. In the year since she began answering phones in a law office she= =20 has often escorted clients afraid of express elevators that shudder and ris= e=20 so fast that passengers' ears pop from the altitude gain. ?????Everybody and I mean everybody asks 'So what happens during a pow= er=20 outage?' she said. ?????Rory Thompson said he believes in karma and is sure that if the rollin= g=20 blackouts come calling his office will be spared. In July 1993 Thompson's= =20 building was the site of an incident known as the 101 California St.=20 massacre in which gunman Gian Luigi Ferri killed eight people and wounded= =20 six before killing himself. ?????This building has already had its bad day he said. They say that t= he=20 day after a crash is the safest day to ride an airline. So I'll take my=20 chances with the rolling blackouts. --- State Says It's Accelerating Plan to Buy Power Utilities' Grid=20 Government: Talks with Edison are reported near completion but agreement= =20 with heavily indebted PG&E has a way to go.=20 By RONE TEMPEST and DAN MORAIN Times Staff Writers=20 ?????SACRAMENTO--As blackouts hit California for a second day Tuesday a ke= y=20 consultant to Gov. Gray Davis said negotiations to buy the power grid owned= =20 by the state's largest utilities are proceeding at an accelerated pace. ?????Wall Street consultant Joseph Fichera said talks with Southern=20 California Edison could be wrapped up within days although those with PG&E= =20 are much less advanced.=20 ?????The administration and PG&E have not reached even an agreement in=20 principle he said. PG&E which has more debt than Edison says its=20 transmission lines are more extensive than those of its Southern California= =20 counterpart. ?????The state wants to buy the utilities' transmission lines and other=20 assets for about $7 billion to provide cash to the utilities help stabiliz= e=20 the electricity supply and ease the power crunch that has plagued Californi= a=20 for months. To research the grid purchase Fichera said the state has had = to=20 pore over 80000 documents just to assess the utilities' liabilities. ?????We are working at a good pace said Fichera chief executive of the= =20 New York firm Saber Partners. . . . If we get to a deal-breaker it might= =20 be longer. ?????By making Fichera who is also a consultant to the Texas Public=20 Utilities Commission available to reporters Tuesday the Davis=20 administration was clearly trying to reassure the public that progress is= =20 being made on the governor's plan to pull the state out of the crisis. ?????Since mid-January when the big utilities' credit failed and suppliers= =20 stopped selling to them the state has spent nearly $3 billion buying=20 electricity from a handful of large suppliers in Texas Oklahoma Georgia a= nd=20 North Carolina. Not a cent has gone to the hundreds of alternative energy= =20 suppliers in California who provide about a quarter of the state's=20 electricity. ?????The Monday and Tuesday blackouts occurred partly because many of the= =20 cash-strapped alternative suppliers including solar biomass and wind powe= r=20 units cut their normal supply to the system in half. They say Edison and= =20 PG&E have not paid them since November the utilities say they are out of= =20 cash. ?????Assemblyman Fred Keeley (D-Boulder Creek) said the plight of the=20 alternative suppliers has dragged on because of the complexity of dealing= =20 with almost 700 individual contractors. ?????Another delaying factor said Keeley who with state Sen. Jim Battin= =20 (R-La Quinta) worked for almost three months to come up with a legislative= =20 plan to lower the small producers' prices was the huge enmity . . .=20 manifested between the utilities and the qualifying facilities. These peopl= e=20 just don't like each other. ?????This week's blackouts provided two painful lessons for the Davis=20 administration: ?????* When it comes to electricity size doesn't matter--every kilowatt=20 counts. During peak use a small wind power facility in Riverside County ca= n=20 make the difference between full power and blackouts. ?????* There is no such thing as a partial solution. Unless the whole energ= y=20 equation is balanced the parts don't work. ?????For the Davis plan to work several key elements need to come together= =20 or utility customers will almost certainly face rate increases above the 19= %=20 already set in motion: ?????* The cost of power purchased by the state must be reduced through=20 long-term contracts with the big out-of-state producers. ?????These contracts the details of which the Davis administration has kep= t=20 confidential are still being negotiated by Davis consultant Vikram Budhraj= a=20 of the Pasadena firm Electric Power Group. The administration says it has= =20 concluded 40 contracts with generators about half of which have been signe= d. ?????According to the most recent statistics released by the Department of= =20 Water Resources which buys power for the state current prices are still= =20 well above the rate state Treasurer Phil Angelides says is necessary for a= =20 planned $10-billion bond offering to succeed. ?????The bonds set for sale in May will be used to reimburse the state fo= r=20 the money it will have spent by that time to buy electricity. The state is= =20 currently spending at a rate of $58 million a day to buy power. If prices= =20 stay high the $10 billion in bonds will not cover the state's power=20 purchases by the end of the summer. ?????Angelides says he cannot proceed with bridge financing for the bonds= =20 until the Public Utilities Commission devises a formula to guarantee that a= =20 portion of utility bills will be dedicated to bond repayment. Angelides has= =20 estimated that under the January law that put the state in the power buyin= g=20 business the state must be reimbursed $2.5 billion annually and that $1.3= =20 billion is needed to service the debt. ?????PUC Administrative Law Judge Joseph R. DeUlloa is expected to announce= =20 his ruling on the reimbursement rate later this week leading to a PUC vote= =20 on the matter as early as next week. ?????* The rates charged for electricity by the alternative producers know= n=20 as qualifying facilities must be cut at least in half down from an averag= e=20 of more than 17 cents per kilowatt-hour. In his news conference Tuesday=20 Davis said he will ask the PUC to set QF rates at 6.9 cents for 10-year=20 contracts and 7.5 cents for five-year contracts. ?????Meanwhile PUC Chairman Loretta Lynch a Davis appointee said Tuesday= =20 that the commission will vote next week on a proposed order requiring=20 Southern California Edison and Pacific Gas & Electric to pay the QFs for=20 electricity in the future. Lynch said a recent PUC assessment showed that t= he=20 utilities have enough cash on hand for that. ?????We are trying to make sure the folks providing the power get paid= =20 Lynch said. The qualified facilities have demonstrated that they haven't= =20 been paid and that it is impairing their ability to provide power. ?????The utilities contend that if they pay the small providers what they o= we=20 them there will not be enough money left to pay other creditors. ?????There is not enough money in the current rate structure to pay the=20 [alternative producers] pay the [Department of Water Resources] and pay th= e=20 utilities for their generation said John Nelson a spokesman for PG&E. ?????* The utilities must sell to the state the power they produce=20 themselves mainly from hydro and nuclear sources at a rate only slightly= =20 above the cost of producing it. This is tied to the ongoing negotiations=20 between the Davis administration and the utilities to restore the=20 near-bankrupt utilities to solvency. ---=20 ?????Times staff writers Julie Tamaki Miguel Bustillo and Tim Reiterman=20 contributed to this report. --- L.A. Long Beach File Suits Over Gas Companies' Prices=20 Energy: Separate actions allege a conspiracy and gouging. Suppliers blame= =20 rising demand and a fluctuating market.=20 By TINA DAUNT and DAN WEIKEL Times Staff Writers=20 ?????Seeking damages that could reach into the billions of dollars the= =20 cities of Los Angeles and Long Beach on Tuesday filed separate lawsuits=20 alleging that a coalition of gas companies illegally conspired to eliminate= =20 competition drive up natural gas prices and discourage the construction of= =20 electricity generating plants in California. ?????Officials from the two cities alleged that Southern California Gas Co.= =20 San Diego Gas & Electric and El Paso Natural Gas Co. violated the state's= =20 antitrust law and engaged in unfair and fraudulent business practices that= =20 caused gas prices to skyrocket. ?????The cities are the first California municipalities to take action=20 against the gas companies. A number of similar lawsuits filed by antitrust= =20 attorneys state regulators and private citizens are pending elsewhere. ?????The energy companies deny any impropriety. They contend that Californi= a=20 is the victim of its own soaring electricity demand and overreliance on=20 fluctuating spot markets for natural gas. ?????The conspiracy theories that have been promoted have no basis in=20 reality said Denise King spokeswoman for Southern California Gas' parent= =20 company Sempra Energy which also was named in the suits. Southern=20 California Gas continues to look out for the best interest of its customers= . ?????The lawsuits filed in Los Angeles County Superior Court accuse the=20 companies of conspiring to manipulate the price of natural gas by agreeing = to=20 kill pipeline projects that would have brought ample supplies of cheaper=20 natural gas to Southern California. ?????They allege that executives for the energy companies made the pact=20 during a meeting in a Phoenix hotel room five years ago to discuss=20 opportunities arising from the state's newly deregulated electricity mark= et. ?????The fulfillment of the illicit plan has had devastating effects on=20 Southern California gas consumers according to Los Angeles' suit. Gas=20 prices in the Southern California market have skyrocketed and the Southern= =20 California gas consumers are paying the highest prices in the nation. ?????In recent months natural gas prices have tripled across the nation fo= r=20 a number of reasons including a shortage of supplies to meet demands for= =20 home heating. Prices have increased far more in California where natural g= as=20 is a central factor in the state's energy crisis. The state relies on the= =20 clean-burning fuel to generate half its electrical power. ?????This not only led to price-gouging of all natural gas consumers from= =20 homeowners to government to industry but it contributed to the current=20 electrical power crisis in California said City Atty. James K. Hahn a=20 mayoral candidate who urged the City Council to pursue the case. ?????Chris Garner Long Beach's utility director said that since November= =20 the average residential bill for gas in Long Beach has more than doubled t= o=20 $175 a month. Some customers he said have seen rate increases of 500%. ?????The people of Long Beach are being gouged by energy conglomerates who= =20 are artificially manipulating the supply of natural gas and reaping excess= =20 profits at the expense of the public said City Attorney Robert Shannon. ?????Holding a special meeting the Los Angeles City Council voted 12 to 0= =20 Tuesday to file the suit. ?????If the allegations are true they are extremely serious said=20 Councilman Mike Feuer who is a candidate to succeed Hahn as city attorney.= =20 And there appears to be some important evidence that substantiates the=20 allegations in the complaint which means that this lawsuit is I think mo= re=20 than a viable lawsuit. ?????Councilman Mark Ridley-Thomas added: We cannot tolerate this and we= =20 must use the full weight of the law to try to correct it. ?????A growing number of lawsuits around the state are targeting California= 's=20 natural gas suppliers. El Paso Corp. which owns the main pipeline=20 transporting out-of-state gas to Southern California has been targeted=20 repeatedly by utility companies state regulators and antitrust attorneys.= =20 ?????Some of the first antitrust lawsuits were filed against Sempra Energy = in=20 December. They were brought by Continental Forge Co. a Compton-based=20 aluminum forging business and Andrew and Andrea Berg who own a business i= n=20 San Diego. ?????The cities' lawsuits request that the defendant companies be barred fr= om=20 such conduct in the future and they seek civil penalties and damages. ?????Shannon estimates that Long Beach could collect more than $100 million= =20 in damages including triple penalties for antitrust violations. ?????We are filing this for our citizens Shannon said. They include the= =20 poor the elderly people living on fixed incomes and small business owners= . ?????The Los Angeles suit was filed on behalf of all Californians. Official= s=20 place damage estimates in the billions.=20 ?????Hahn however warned council members that it could take the city a ye= ar=20 or more to resolve the suit. ?????Lawsuits take time Hahn said. We are hopeful we can enter into=20 meaningful discovery to disclose what's been going on. --- Davis OKs Subsidy of Pollution Fees=20 Smog: As part of secret deal to get long-term energy contracts state would= =20 pay for some of the credits that allow excess power plant emissions. Critic= s=20 renew call for full disclosure.=20 By DAN MORAIN Times Staff Writer=20 ?????SACRAMENTO--As part of his closed-door negotiations to buy electricity= =20 Gov. Gray Davis has agreed to relieve some generators from having to pay=20 potentially millions of dollars in fees for emitting pollutants into the ai= r=20 Davis said Tuesday. ?????Davis announced two weeks ago that his negotiators had reached deals= =20 with 20 generators to supply $43 billion worth of power during the next 10= =20 years. ?????However the Democratic governor has refused to release any of the=20 contracts or detail various terms contending that release of such=20 information would hamper the state's ability to negotiate deals with other= =20 generators and therefore ultimately would raise prices Californians pay for= =20 electricity. ?????Sources familiar with the negotiations speaking on condition of=20 anonymity said the agreement reached with Dynegy Inc. a power company bas= ed=20 in Houston is one that includes language requiring that the state pay the= =20 cost of credits that allow emissions. Dynegy spokesman Steve Stengel declin= ed=20 to discuss the company's deal with the state. ?????We couldn't get them to sign contracts it was a sticking point Dav= is=20 said of the decision to pay the fees of some generators. We had to lock do= wn=20 some power so we were not totally dependent on the spot market. ?????The fees in question are part of an emission trading system known as= =20 RECLAIM. Under the system companies are allotted a certain amount of=20 allowable pollution. If their operations pollute more companies are requir= ed=20 to purchase credits on an open market. Currently the credits cost about $45= =20 per pound of pollution--an amount that can lead to a bill of well over $10= =20 million a year for a power plant. ?????The South Coast Air Quality Management District which regulates=20 pollution in the Los Angeles Basin is considering steps to significantly= =20 lower the cost of the system--a step that could considerably cut the state'= s=20 potential cost Davis said. ?????Senate Energy Committee Chairwoman Debra Bowen (D-Marina del Rey)=20 defended the decision to cover the power company's costs. ?????It is a question of whether it brings down the price of power she= =20 said. If it brings down the price of power I don't have a problem with it= . ?????Nevertheless word that the contracts could bind the state to pay=20 pollution fees caused some critics of Davis' policy to renew calls for Davi= s=20 to reconsider the secrecy surrounding the power negotiations. The payment= =20 provision underscores the fact that the contracts involve more than merely= =20 the prices the state will pay for its megawatts the critics note. ?????The Legislature should have known about it said Senate President Pr= o=20 Tem John Burton (D-San Francisco). It is going to cost taxpayers money. It= =20 makes you wonder. . . . This was a policy issue that was never discussed wi= th=20 the Legislature. ?????V. John White a lobbyist for the Sierra Club who also represents=20 alternative energy producers called the contract proposal a horrible=20 precedent. ?????Until we know exactly what the state has agreed to and how much of a= =20 subsidy this represents we can't determine how serious the breach of=20 principle this is White said. ?????Another critic of the secrecy of the negotiations Terry Francke=20 general counsel for the California First Amendment Coalition said the=20 provision in question raises the possibility that there are other=20 [concessions] that have not yet come to light. ?????In the summer when demand for power is highest some generators=20 probably will exceed pollution limits set by regional air quality managemen= t=20 districts. ?????To avert blackouts state officials might ask the companies to keep=20 plants running. In such cases some sources familiar with aspects of the=20 contracts said the contract language could be interpreted to suggest that= =20 the state would cover any fines--although Davis said Tuesday the state will= =20 not cover the cost of fines. ?????A recent Dynegy filing with the Securities and Exchange Commission=20 underscores the rising cost of pollution-related measures. The company whi= ch=20 is partners with NRG Energy in three California plants in El Segundo Long= =20 Beach and Carlsbad in San Diego County said its aggregate expenditures fo= r=20 compliance with laws related to the regulation of discharge of materials in= to=20 the environment rose to $14.3 million in 2000 from $3.6 million in 1999. ?????A South Coast Air Quality Management spokesman said Dynegy's facilitie= s=20 appear to be fairly clean--although Sierra Club lobbyist White said Dynegy= =20 has been seeking a permit at one of its plants to burn fuel oil which is= =20 dirtier than natural gas. ?????Davis said he intends to make this information public but he added= =20 that we do not want to put the public's interest in jeopardy by asking the= m=20 to pay higher prices. ?????Nobody likes the notion that [the administration is] not being fully= =20 forthcoming Davis said. But I also have a corollary responsibility that = I=20 don't stick these generators with a higher rate. --- As Losses Mount Companies Work Around Outages=20 By MARLA DICKERSONJERRY HIRSCH and NANCY CLEELAND Times Staff Writers=20 ?????As blackouts moved from theory to reality many Southern California=20 businesses spent Day 2 assessing their losses and digging in for what they= =20 expect to be a long hot summer. ?????An hour without electricity may be an inconvenience for most residents= .=20 But for manufacturers and many other businesses even a brief loss of power= =20 can generate tens of thousands in losses. ?????Whether shaping metal or making salsa businesses of all kinds=20 complained Tuesday about the lack of warning of impending outages even as= =20 they sought sometimes creative ways to work around the loss of power. ?????Rattled by news reports of Monday's rolling blackouts Industry-based = El=20 Burrito Mexican Food Products started its Tuesday shift at 2 a.m. Workers h= ad=20 just finished cooking and packaging the last batches of salsa and masa when= =20 the lights went out at 10:20 a.m. ?????We dodged a bullet said El Burrito founder Mark Roth. Losing a day= 's=20 production of salsa would have cost me $15000 to $20000. ?????But other companies weren't so fortunate. ?????Long Beach-based Delco Machine & Gear was still totaling up its losses= =20 from Monday's blackout which amounted to at least $30000 in lost wages an= d=20 production said Nick Campanelli vice president of manufacturing. The=20 company a division of Florida-based B/E Aerospace Inc. makes parts for th= e=20 aerospace industry. The sudden loss of power caused its sophisticated metal= =20 cutting and grinding machines to crash ruining precision parts in producti= on. ?????But the losses don't end there. He said employees will need to spend= =20 hours resetting the equipment. Campanelli is particularly irked that the=20 company received no warning. ?????Five minutes' notice he fumed. That's all I needed. ?????Although businesses such as Campanelli's typically receive no warning= =20 that they are about to lose power insurance companies count the rolling=20 blackouts as planned events a determination that in most cases=20 disqualifies a business from making a claim. ?????I know it must be frustrating for businesses who have the power go of= f=20 suddenly but these outages are planned by the grid operators said Pete= =20 Moraga of the Insurance Information Network of California. That means it= =20 would not be a covered peril in a traditional business insurance policy. ?????Typically business insurance covers loss of profit and damage from=20 unforeseen events such as fires or windstorms. The component of the policy= =20 that covers interruptions in business kicks in after a given amount of time= =20 elapses usually 24 to 48 hours. ?????Business polices can be written to include unusual coverages Moraga= =20 said but he has never heard of a policy that covers losses from a rolling= =20 blackout. ?????Some companies are taking measures not to get caught in a situation=20 where a blackout can hurt them. ?????The region's largest steel supplier shut down for two hours Monday aft= er=20 Southern California Edison called to warn of tight supplies. ?????We just can't take a chance said Lourenco Goncalvez president of= =20 California Steel Industries Inc. in San Bernardino County. We have a lot o= f=20 safety issues. People could get hurt. ?????Goncalvez said the plant has multiple 20-ton and 25-ton overhead crane= s=20 that operate with electromagnetic devices which would fail if they lost=20 power suddenly. Falling materials could injure workers below he said. We= =20 have been asking to be exempt from rolling blackouts he said. ?????Goncalvez said he couldn't put a price on the lost production at the= =20 24-hour plant and said he worried more about the long term. ?????Two hours is nothing he said. My concern is this thing will start = to=20 happen almost every day. If it will be like this all summer you can be sur= e=20 it will have dramatic consequences for the entire economy. . . . We're goin= g=20 to have a shortage of steel products in California. Maybe the government do= es=20 not consider this is serious. We'll see. ?????At Sport Chalet a La Canada Flintridge-based chain of 22 sporting goo= ds=20 stores in Southern California an administrative assistant monitors the sta= te=20 power situation hoping to warn any stores that are in danger of losing=20 power said Craig Levra the company's chief executive. ?????Levra said the assistant was assigned the monitoring duties last year= =20 when rolling blackouts were still only a threat. ?????The chain put in place an emergency plan--similar to what it would do = in=20 a major earthquake. Backup power will kick on emergency lights and allow th= e=20 cash registers to complete transactions. Employees are instructed to escort= =20 customers from the building safely Levra said. ?????Other businesses however have plans to remain open during the 60- to= =20 90-minute blackouts. ?????When power went out at two Cheesecake Factory restaurants in Orange=20 County on Monday afternoon the eateries switched to serving cold dishes su= ch=20 as sandwiches and salads said Howard Gordon senior vice president of the= =20 Calabasas Hills-based chain. ?????The restaurants had enough backup power to operate emergency lights an= d=20 cash registers. Large windows provided the rest of the light Gordon said. ?????So far the 99 Cents Only Stores chain has missed the shotgun pattern = of=20 the blackouts. But with nearly 100 stores in California company President= =20 Eric Schiffer believes it is only a matter of time before the lights go out= =20 at one of its outlets. ?????Though the stores have some backup power the chain has systems in pla= ce=20 to operate without it. Its cash registers can open mechanically Schiffer= =20 said. Because an item sells for a multiple of 99 cents sales clerks are=20 equipped with blackout sheets that calculate a customer's tab including= =20 tax. All the clerk has to do is count the number of items in the shopping= =20 cart and check the tables on the sheet. ?????This week's power crunch has been exacerbated by the fact that so-call= ed=20 interruptible electricity customers no longer face large penalties if they= =20 decline to shut down their operations when supplies get critically low. ?????The Public Utilities Commission suspended the fines in January to ease= =20 the burden on about 1400 businesses that found themselves bearing the brun= t=20 of the crisis to prevent rolling blackouts in the rest of the state. ?????According to Edison about 10% of its interruptible customers are=20 complying with requests to curtail electricity usage during crunch time. Bu= t=20 Scott Keller isn't among them. ?????The owner of Chino-based STC Plastics Inc. said he was forced to shut= =20 down more than 20 times since September costing him as much as $10000 in= =20 lost production per day. He ignored requests Monday and Tuesday to curtail= =20 usage and said he doesn't feel a twinge of remorse. ?????If I'm shut down I can't pay my workers he said. I'd feel more=20 guilty about that. ?????But this is one area where insurance eventually might help. Moraga sai= d=20 some carriers are developing plans that would cover penalties for continuin= g=20 to use power after they have been asked by a utility to cut back. --- Wednesday March 21 2001=20 A Blackout on Answers=20 Davis needs to do a better job in communicating to Californians about the= =20 electricity crisis. In the absence of that cynicism grows.=20 ?????The oil shocks of the 1970s from the Arab oil embargo to the Iran-Ira= q=20 war were dead simple compared with the California power shortage. Then th= e=20 problem was a lack of imported oil and the chief symptom was long lines and= =20 high prices at gas stations. Politicians urged conservation: Turn down the= =20 heat drive fewer miles buy more efficient cars. People understood the cau= se=20 of the crisis and the benefit of their actions. Today it's a different stor= y=20 and a damnably complicated one that gives consumers no place--or actually= =20 too many places--to focus their anger.=20 ?????The last two days of rolling blackouts including previously exempt=20 Southern California have not reduced power demand or at least not enough.= =20 Consumers are suspicious: Are out-of-state power companies holding back=20 production? Did utilities really not have enough money to pay alternative= =20 energy producers--the little guys who combined could produce enough power= =20 to prevent the blackouts? And what happened to long-term power contracts t= he=20 state-bargained deal that was supposed to stabilize the crisis?=20 ?????The frustrations are vast and there are too many gaps in the story. I= f=20 it's just a pack of thieves creating an artificial shortage as even some= =20 consumer organizations charge why should anyone sacrifice to conserve? Tha= t=20 in a nutshell is the problem that Gov. Gray Davis the state Legislature a= nd=20 the Public Utilities Commission face.=20 ?????Davis for one has to level with the public and stop acting as if he= =20 can fix the crisis. He has proved he can't at least not without reductions= =20 in usage and most likely rate increases. If Davis who is notoriously=20 averse to delivering bad news had leveled with the public about the=20 fragility of the current system the last two days of blackouts statewide= =20 (except in places with full municipal power like Los Angeles) might not ha= ve=20 come as such a shock.=20 ?????The Legislature tried and failed earlier to solve the alternative ener= gy=20 producers' nonpayment problems with a very complicated bill. Tuesday night= =20 Davis and legislators announced a simpler plan that would set lower more= =20 flexible rates for alternative power but also force the utilities to pay fo= r=20 future purchases.=20 ?????Which leads to the utilities themselves. With the state shelling out= =20 billions for power from the major generators how could Southern California= =20 Edison and Pacific Gas & Electric still not have the cash flow to pay the= =20 alternative producers? That motley collection of biomass solar wind and= =20 cogeneration companies has been shutting down for nonpayment--some of them= =20 because natural gas suppliers have cut them off. PG&E has made some payment= s=20 but SCE has paid zilch though a spokesman says it hopes to strike a deal t= o=20 start paying this week.=20 ?????Without enough honest information conspiracy scenarios fill the holes= .=20 Bad news is better than no news something Davis seems not to quite realize= .=20 By today or Thursday the weather will cool and some plants taken down for= =20 repair will come back online. The blackouts may cease but the crisis will b= e=20 just as deep as it was Monday and Tuesday. It is up to Davis to do a better= =20 job of persuasively explaining why. Otherwise the cynicism grows.=20 --- Wednesday March 21 2001=20 Rolling Blackouts: Blatant Extortion=20 ?????* Re Rolling Blackouts Hit Southland for First Time as Production=20 Falls March 20:=20 ?????So here we are 22 years after the notorious gas shortage having=20 another gun held to our head by an opportunistic energy consortium. Back in= =20 1979 we all had to wait in long lines just to pay more for gasoline. Now = we=20 have to face food in our freezers thawing and simmering in our homes during= =20 hot summer days just to earn the honor of paying more for electricity.=20 ?????Of course as soon as the rates are up and the environmental concerns= =20 are shoved aside watch how plentiful power will be. When is somebody in=20 government going to stand up for the consumer and stop this blatant form of= =20 extortion?=20 ?????JOHN JOHNSON=20 ?????Agoura Hills=20 * * * ?????So customers of PG&E and Edison are shielded from soaring wholesale= =20 prices? Some shield: turning off all our power without so much as a moment= 's=20 notice endangering lives and disrupting businesses just to keep our=20 electricity prices unreasonably low. Let's lift the rate caps to get the=20 lights back on. And if I need to be shielded from soaring prices I'll turn= =20 my own lights off.=20 ?????ANDREW LOWD=20 ?????Claremont=20 * * * ?????This state needs adequate reliable electricity to run a diverse=20 economy. Both political parties and business interests are at fault. This= =20 crisis demands top priority aimed at lasting solutions.=20 ?????The most immediate solution is fast-tracking of added generating=20 capacity. Freeway bridges were rebuilt in record time after the Northridge= =20 quake so we know it can be done. That is the type of effort that is needed= =20 immediately.=20 ?????Since Democrats hold the governorship and control both state legislati= ve=20 houses they are in the driver's seat. If the lights go out the Democrats = go=20 out. If this state government can't solve the problem we need a new=20 government that can.=20 ?????STEVE ANDERSON=20 ?????Huntington Beach=20 * * * ?????The alleged energy crisis in California is entirely contrived to relax= =20 environmental pollution standards and to raise energy rates. It's curious= =20 that the L.A. Department of Water and Power which was not deregulated is= =20 not currently experiencing an energy crisis. PG&E and Edison are both part = of=20 national and multinational corporations. Why should utility customers have = to=20 pay for their economic problems or gross mismanagement?=20 ?????Several power plants were taken off-line for routine maintenance=20 which may not have been so routine. Energy is a vital necessity if these= =20 companies can't provide it at a reasonable affordable rate then they shoul= d=20 be replaced by companies that can be taken over by the government or=20 de-deregulated. There is an abundance of solar energy in California of whi= ch=20 only a small fraction is being utilized. There is no shortage of energy in= =20 California only a shortage of intelligence will and honest politicians.= =20 ?????CHARLES B. EDELMAN=20 ?????Los Angeles=20 --- Utilities' Demand Blocks Bailout=20 NEGOTIATIONS HIT SNAG: PG&E Edison want end to price freeze if they sell= =20 transmission lines to state David Lazarus Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N114450.DTL=20 California's near-bankrupt utilities are demanding that higher electric rat= es=20 be a part of any deal to sell the state their power lines The Chronicle ha= s=20 learned.=20 A rate increase -- perhaps of more than 50 percent according to earlier=20 industry estimates -- would certainly draw a firestorm of protest from=20 consumer groups and force Gov. Gray Davis to backtrack from earlier pledges= =20 that rates would remain unchanged.=20 Nevertheless sources close to negotiations on the deal said Pacific Gas an= d=20 Electric Co. and Southern California Edison are attempting to make higher= =20 rates a condition for agreeing to a bailout scheme in which they would sell= =20 the state their transmission systems and some land.=20 The sources said the talks hit a new snag this week when state officials=20 realized that fine print sought by the companies could require the Public= =20 Utilities Commission to pass along all of the utilities' costs to ratepayer= s.=20 The sources said this would end a rate freeze that shields consumers from= =20 runaway wholesale electricity prices.=20 The inclusion of potential rate increases in the talks reflects the growing= =20 complexity of a deal originally intended by Davis to stabilize the finances= =20 of PG&E and Edison so banks would resume loans to the cash-strapped=20 utilities.=20 The negotiations subsequently have expanded to involve a state purchase of= =20 the utilities' transmission networks and acquisition of utility-owned land= =20 including spectacular coastal property near PG&E's Diablo Canyon nuclear=20 power plant.=20 Now they also have embraced further deregulation of California's=20 dysfunctional electricity market.=20 Clearly one of the terms being discussed is the regulatory environment= =20 said Joseph Fichera head of Saber Partners a New York investment bank tha= t=20 is advising Davis in the talks.=20 The past situation has not worked well he added. The utilities want som= e=20 certainty about their future.=20 TENTATIVE DEAL WITH EDISON To date the governor has announced a tentative agreement with Edison for t= he=20 state to buy the utility's power lines for almost $3 billion. Discussions= =20 with PG&E for a similar accord have dragged on for weeks.=20 An Edison official asking that his name be withheld acknowledged yesterda= y=20 that an end to the rate freeze is an expected result of the power- line sal= e.=20 Once the details of the pact are complete dominoes will fall the offici= al=20 said. One of the dominoes is the rate freeze.=20 A PG&E spokesman declined to comment.=20 In fact both Edison and PG&E have been aggressively seeking an end to the= =20 rate freeze for months.=20 The two utilities have a lawsuit pending in federal court demanding that th= e=20 PUC immediately raise rates so the utilities can recover almost $13 billion= =20 in debt accrued as a result of the freeze.=20 They have been trying a lot of things to get the rate freeze ended in=20 various forms said Carl Wood who sits on the PUC. Adding it to the=20 present talks is consistent with past behavior.=20 Wall Street has taken note that the negotiations no longer appear to be=20 making progress.=20 Paul Patterson an energy industry analyst at Credit Suisse First Boston= =20 told clients on Monday that the discussions may have lost some momentum in= =20 recent days. He did not give a reason.=20 For his part the governor sounded unusually cautious about the course of t= he=20 talks when asked late last week if a breakthrough was imminent.=20 SECRET STICKING POINTS We are going to take the transmission systems and the land that's deeded= =20 and we will work out an agreement Davis said at an appearance in San Jose= .=20 But there are a number of sticking points in the talks with PG&E that I'm= =20 not going to reveal.=20 One of those sticking points apparently is an insistence that the sale of= =20 utility assets include a long-sought lifting of the rate freeze.=20 Sources said lawyers from both PG&E and Edison had inserted the related ter= ms=20 into draft accords affecting each utility and that the full impact of the= =20 additions was not realized by state officials until this week.=20 One source said the language was just convoluted enough to slip beneath the= =20 radar screen of state negotiators. But the upshot once the words had been= =20 parsed was that the PUC effectively would lose control over power rates.= =20 CREDITWORTHINESS ON THE TABLE In Edison's case the terms of the tentative deal include the governor aski= ng=20 the PUC to support the creditworthiness of the utility.=20 This would ensure that future investments in both utility distribution and= =20 utility generation plants are provided fair returns of and on capital=20 consistent with current authorized returns and capital structure provisions= =20 it says.=20 Sources said the provision could be interpreted as a guarantee from the sta= te=20 that Edison would be permitted to recoup all outstanding costs from=20 ratepayers.=20 There may be some assumptions about this language that the rate freeze end= s=20 if it is adopted the Edison official said adding that he saw no reason t= o=20 disagree with such assumptions.=20 But Fichera Davis' adviser in the talks insisted that nothing is set in= =20 stone and that the negotiations are proceeding without a hitch.=20 This is a very complex transaction he said. God and the devil are in th= e=20 details.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Utilities' Demand Blocks Bailout=20 BLACKOUTS ROLL ON: Weather increased consumption blamed=20 David Lazarus Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N156508.DTL=20 Hundreds of thousands of Californians went without electricity for a second= =20 day yesterday as unusually warm weather and a high number of idle power=20 plants prompted blackouts throughout the state.=20 State officials said electricity usage rose yesterday even though condition= s=20 were largely unchanged from a day before. They surmised that fewer=20 Californians were conserving power.=20 We need people to really focus on that implored Patrick Dorinson a=20 spokesman for the Independent System Operator manager of the state's power= =20 grid. The more people can do the better it will be.=20 Rolling blackouts were ordered by the ISO about 9:30 a.m. and were suspende= d=20 at 2 p.m. after several plants that had been down for repairs returned to= =20 service. Additional power also was obtained from a plant in Arizona.=20 Utilities estimated that about 560000 customers were affected yesterday= =20 compared with more than 1 million a day earlier.=20 This week's blackouts marked the first time that people in Los Angeles shar= ed=20 the pain with those in San Francisco. Blackouts in January were confined to= =20 the northern part of the state.=20 FEWER AFFECTED IN SOUTH However Southern California Edison's burden was considerably lighter=20 yesterday than that of Pacific Gas and Electric Co.=20 Karen Shepard-Grimes a spokeswoman for the Southern California utility sa= id=20 only about 50000 customers went without power compared with nearly 440 0= 00=20 for PG&E.=20 Affected areas in the south included Palm Springs Santa Monica Long Beach= =20 and Pomona.=20 We're not in the business of turning customers' lights off Shepard- Grim= es=20 said. We're in the business of keeping lights on.=20 In PG&E's case things were tougher because low rainfall means that less=20 power is currently available from dams throughout the Pacific Northwest.=20 Ron Low a spokesman for the utility said blackouts were experienced by PG= &E=20 customers from Eureka to Bakersfield.=20 Our goal was to carry out the ISO's order with minimal impact on customers= =20 he said.=20 For its part San Diego Gas & Electric said about 75000 customers were=20 darkened.=20 Yesterday's blackouts began with PG&E customers in Block 12 and halted midw= ay=20 through Block 14. Customers in each block -- defined by power circuits rath= er=20 than geography -- typically will lose power for about 90 minutes before the= =20 service interruption rolls elsewhere.=20 Some cutoffs can last more than two hours however because of technical=20 problems switching individual blocks on and off.=20 NEXT UP: BLOCK 14 If additional blackouts are ordered today they will commence with the=20 remaining portion of Block 14 customers. (PG&E customers can determine thei= r=20 block by looking at the bottom left-hand corner of their monthly bill.)=20 The ISO's Dorinson said it is hoped that cooler weather and increased=20 generation will help avert further cutoffs this week.=20 Units are coming back into service that have been out he said. That wil= l=20 help a great deal.=20 Roughly 15000 megawatts of generating capacity was offline yesterday=20 including half of the alternative-energy plants which are unable to afford= =20 natural gas to run their turbines.=20 Many of the plant owners say they have not been paid by PG&E and Edison sin= ce=20 November. They are asking federal regulators for permission to sell their= =20 electricity elsewhere.=20 At the same time one of two units at the Mohave Generating Station in Neva= da=20 damaged in a fire Monday returned to service yesterday easing the load on= =20 California's grid.=20 The plant partly owned by Edison is not expected to return to full output= =20 until tomorrow.=20 PROBING SHUTDOWNS Nearly a third of California's generating capacity is currently down for=20 scheduled or unexpected maintenance. State regulators are investigating=20 whether some plant owners might be deliberately shutting down to drive pric= es=20 higher or reduce operating costs.=20 Loretta Lynch president of the Public Utilities Commission on Monday call= ed=20 the number of idle plants highly suspicious.=20 Dorinson at the ISO said that about 12000 megawatts of mainstream capacity= =20 was offline yesterday compared with roughly 10000 megawatts last year at= =20 this time.=20 --=20 Tell Us What You Think=20 Can you save 20 percent on your energy usage? Gov. Gray Davis is offering= =20 rebates for Californians who save on power starting in June and if you've= =20 got a strategy for conserving The Chronicle wants to hear it. We'll be=20 writing about the hardest-working energy savers in a future story. To get= =20 involved Write to the Energy Desk San Francisco Chronicle 901 Mission St= .=20 San Francisco 94103 or e-mail --=20 THE ENERGY CRUNCH -- Blackouts: About 560000 Californians including 440000 in Northern=20 California lost electricity yesterday for 90 minutes at a time.=20 -- Areas affected: Blackouts hit parts of blocks 12 and 14 and all of block= =20 13 yesterday. In the event of further blackouts the remainer of block 14= =20 would be next followed by block 1.=20 -- Outlook: Officials say blackouts are less likely today as temperatures a= re=20 expected to cool and power plants that have been offline for maintenance=20 resume generating electricity.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Manners Go Out the Window=20 Pedestrians in peril as drivers turn darkened S.F. streets into free-for-al= l=20 Steve Rubenstein Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N173178.DTL=20 Nobody got plowed into yesterday at Fifth and Howard streets in San=20 Francisco. Many came close.=20 The power outage that darkened the traffic lights at the frenetic South of= =20 Market intersection for more than an hour also darkened the souls of untold= =20 numbers of drivers sending motoring manners into the toilet.=20 The law says motorists are supposed to treat an intersection with=20 nonfunctioning traffic lights as a four-way stop. That means everyone stops= =20 then takes turns -- one by one -- creeping through the intersection.=20 Tell that to the two people in motorized wheelchairs who were nearly creame= d=20 by two eastbound SUVs.=20 Or to the young Swedish couple who had traveled halfway around the globe= =20 only to scamper through the intersection barely ahead of an office supply= =20 truck.=20 Or to the New Jersey tourist who proclaimed that California drivers during= =20 power outages were proof positive that the Chaos Theory lives and breathes.= =20 Some motorists stopped and took turns but many didn't. Some sped into the= =20 intersection immediately behind the vehicle in front without themselves=20 stopping at the white line. Some sailed through with a rolling stop and a= =20 warning honk. Some blasted through without stopping or honking.=20 I'm scared to death said Brian Walters of Dorchester N.J. after making= =20 it across Howard Street. This is organized madness. I subscribe to the Cha= os=20 Theory and this is what it looks like.=20 Sydney Freedman a tourist from Sydney walked briskly across the darkened= =20 crossroads smiling grimly.=20 I'll chance it he said.=20 He looked back and saw a woman in a motorized wheelchair nearly get squishe= d=20 by a westbound Chevy.=20 You have to be authoritative in this town when you cross the street he= =20 said. Especially that lady.=20 Therese Anderson and Andreas Sandstrom from Sweden raced across as quickl= y=20 as their backpacks would allow.=20 In this country everyone is in such a hurry said Anderson.=20 Everybody drives like a madman added Sandstrom. They say 'I want to be= =20 home right now and I don't care what happens to anyone else.' =20 The couple paused to gaze in wonder at the intersection learning more abou= t=20 America in five minutes than a pile of guidebooks could tell them.=20 This intersection said Sandstrom reminds you not to take life for=20 granted.=20 A few minutes later Parking Control Officer Tom Butz arrived in his meter= =20 minder wagon and pulled his orange vest and whistle from the saddlebag. He= =20 strode brave and true into the center of the bullring planted himself=20 between the whizzing cars and began waving his arms as if conducting The= =20 Rite of Spring.=20 I'm all by myself he said. I know it's a little risky. I'd better keep = my=20 angels with me.=20 At that moment the angels were on duty in Menlo Park where a blacked-out= =20 intersection at El Camino Real and Santa Cruz Avenue backed up traffic so f= ar=20 that it stretched into neighboring Atherton.=20 It's a large intersection and traffic is slow anyway but now it is severe= ly=20 impacted said Police Sgt. Terri Molakides. We don't get any warning=20 either. When the power is out the power is out. It's not like we can make= =20 any plans.=20 In general motorists seemed more likely to obey the four-way-stop rule on= =20 the Peninsula and in the East Bay than in San Francisco.=20 In San Mateo County some police departments have stopped trying to make=20 advance plans to cover darkened intersections. San Mateo Police Sgt. Kevin= =20 Rafaelli said putting up signs and posting officers sometimes caused proble= ms=20 rather than solving them.=20 If people just follow the law (and) stop at the intersection they can=20 handle it better than we do if we're out there he said. People are sort = of=20 getting used to it and are dealing with it.=20 In Berkeley and Emeryville motorists stopped one at a time at temporary st= op=20 signs with no apparent problems. At University Avenue and Sacramento Stree= t=20 in Berkeley Officer Matt Meredith said motorists were behaving themselves.= =20 That wasn't the case a while back when a driver who didn't stop at an=20 intersection during a blackout was broadsided by someone who did Meredith= =20 said.=20 The thing to remember is to stop and look he said.=20 TRAFFIC TIPS To avoid a collisions during blackouts the California Highway Patrol offer= s=20 this advice to motorists:=20 -- Treat any intersection with inoperative traffic lights as a four-way sto= p.=20 Each vehicle must stop when arriving at the white limit line then proceed= =20 only when safe taking turns.=20 -- If two vehicles arrive at the intersection at the same time the motoris= t=20 on the left must yield to the motorist on the right.=20 -- Never insist on taking the right of way even if you are entitled to it.= =20 -- Follow the directions of a police officer or traffic control officer=20 whose directions take precedence over lights or signs.=20 Chronicle staff writers Henry K. Lee and Matthew B. Stannard contributed to= =20 this report. / E-mail Steve Rubenstein at 2001 San Francisco Chronicle ? Page?A - 8=20 --- --- Historic Blackouts in State=20 Bay Area learns to cope=20 Jonathan Curiel George Raine Justino Aguila and Matthew B. St Tuesday March 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/M N219412.DTL=20 Today's rolling blackouts caused concern throughout the Bay Area including= =20 Colma where the sudden lack of power apparently caused a fire.=20 A light fixture at the Home Depot store in Colma caught fire around 10:45 a= .=20 m. 15 minutes after Pacific Gas and Electric Co. ordered blackouts for the= =20 area. No one was hurt.=20 I was in the back of the store when the power outage started said Dave= =20 Cole a consultant from Pacifica who was shopping for bolts and screws. We= =20 lost maybe 90 percent of the lights then maybe 10 percent of the lights ca= me=20 up. Then I heard a guy saying 'Get a ladder get a ladder!'=20 One of the lights on the ceiling had caught on fire and a couple of peopl= e=20 were getting ladders and fire extinguishers.=20 Store managers whisked everyone out of the store and Colma firefighters=20 arrived to make sure the blaze was extinguished.=20 At 11 a.m. Cole was waiting to get back into the store which was still=20 closed.=20 I need my bolts he said.=20 Elsewhere the San Francisco Fire Department had to rescue people stuck in = an=20 elevator at 2001 Embarcadero North said fire department spokesman Pete=20 Howes.=20 Scores of residents and businesses near the Embarcadero including the Levi= =20 Strauss & Co. headquarters were affected by the blackout.=20 At Levi Strauss this morning Phil Marineau the president and chief=20 executive officer led his 1300 employees by example using only minimal= =20 lighting for a meeting in his office at 10 a.m.=20 Employees were sent e-mails minutes after PG&E's 9:30 a.m. notification tha= t=20 a blackout was possible. The e-mails said workers should frequently save wo= rk=20 on their computers and that they should remain in the building and stand b= y=20 for further instructions.=20 Emergency lighting in hallways and stairwells were operated by generators.= =20 All elevators descended to the ground floor but one remained operating=20 through a generator.=20 Worked nicely said Jeff Beckman a company spokesman.=20 Yesterday -- the first day that rolling blackouts returned -- Shannon=20 Cashman's home in Walnut Creek was a difficult place to be.=20 Cashman's 4-year-old daughter Madison suffers from a brain defect that=20 stops her from breathing during sleep. The girl depends on a ventilator tha= t=20 runs on electricity.=20 Recently hospitalized and with a weakened immune system Madison badly need= ed=20 a nap yesterday afternoon. But when the Cashmans' power went out about noon= =20 it meant reading and coloring instead of rest for the girl and a little mor= e=20 anxiety than normal for her mother.=20 If this was a major earthquake or something like that and we couldn't use= =20 the ventilator we'd take her to the hospital said the 33-year-old Cashma= n.=20 Otherwise we'll just wait for the power to come back on.=20 In a stroke of irony yesterday the lights went out and computer screens we= nt=20 dark at the San Francisco offices of the state Public Utilities Commission= =20 the agency some people blame for the energy crisis and others look to for t= he=20 solution.=20 At a Petco animal store in Redwood City nocturnal leopard geckos that=20 weren't familiar with the state's power woes thought it was night and awoke= =20 from their routine daytime slumber.=20 The geckos clung to the glass of their cages as manager Sally Daine and her= =20 employees misted lizards and watched frozen mealworms melt.=20 The worst thing is some of the reptiles need heat but it's so hot I don'= t=20 think it will matter she said.=20 At Auto Pride Car Wash a few blocks away Dan Giudici watched as the team o= f=20 employees he supervised washed cars the old-fashioned way -- with buckets a= nd=20 hoses. The company's big mechanical car wash went unused.=20 Customers didn't seem to mind the manual wash said Giudici who was chargi= ng=20 half-price. But he was running out of towels.=20 Even those who hoped they were immune to power problems were affected.=20 Palo Alto runs its own utility but the electricity began winking out about= =20 12:30 p.m.=20 The city depends on a distribution line of the state grid so it is=20 vulnerable to blackouts said Linda Clerkson public relations manager for= =20 Palo Alto Utilities. In addition the city relies on PG&E for some of its= =20 power she said.=20 Businesses were caught by surprise.=20 Well at least it happened in a better time than the morning said Nick= =20 Badiee owner of the Lytton Roasting Co. coffee house. My toaster went out= =20 and the coffee began getting cold so I lost three or four people who walke= d=20 out the door. I'm not angry yet but I would say I am concerned.=20 For one Milwaukee woman visiting San Francisco the blackout was an=20 unexpected lesson in the problems of electricity deregulation.=20 Cindy Wilburth a financial consultant who advises Wisconsin utilities cam= e=20 to the Bay Area for vacation but left yesterday with important research for= =20 her job.=20 This has been a huge learning lesson for Wisconsin Wilburth said as she= =20 waited for a bus outside the powerless Comfort Inn by the Bay in Cow Hollow= .=20 Wilburth said her state and others that once eyed deregulation are now=20 backing off.=20 It just makes me realize how we've gotten ourselves in a pinch in a free= =20 economy she said.=20 As she mused about the predicament in which the state has found itself her= =20 friend was just thankful to get out of here.=20 I love the cold compared to this said Cindy Stuckey of Milwaukee. At= =20 least I know I can stay in my home secure and warm.=20 Across the street at the Travelodge By the Bay Rolando Gutierrez had=20 already lost three guests just an hour into the blackout.=20 This is the richest state and this is a rich city -- plenty of people want= =20 to come here he said. We shouldn't be suffering these blackouts.=20 Chronicle staff writers Jaxon Van Derbeken Mark Martin Henry K. Lee=20 Michael McCabe Bernadette Tansey and Marshall Wilson contributed to this= =20 report.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Bay Area residents learning to roll with blackouts=20 Posted at 9:58 p.m. PST Tuesday March 20 2001=20 JOHN=20 WOOLFOLK=20 AND STEVE=20 JOHNSON=20 Mercury News=20 As rolling blackouts swept the state for a second straight day Tuesday=20 Californians already seasoned by droughts and earthquakes were learning to= =20 live with yet another upheaval: periodic power outages.=20 Blackouts are still a novelty in Southern California -- hit for the second= =20 time Tuesday -- but they're almost routine for Bay Area residents who have= =20 seen four days of outages this year and now expect many more as temperature= s=20 rise. Toting flashlights avoiding certain roads and even shutting off thei= r=20 coveted hot tubs they're adjusting to life in California's new Dark Age.= =20 ? ? Karen T. Borchers--Mercury News When the lights went out at Grant Elementary School in San Jose on Tuesday= =20 morning teacher Renee Johnson took her second-grade students out to the la= wn=20 to read to them. Marjorie Meagher now looks at her clock before taking the elevator she need= s=20 to get around her two-story San Jose home fearing she'll get stuck during= =20 rolling blackouts.=20 ``They tend to happen on the hour or half-hour so I try not to use it=20 then'' said Meagher 74 who is disabled. ``I'm very careful. My own=20 personal fear is getting stranded in the elevator.''=20 From 750000 to about 1 million customers lost power for an hour or so in= =20 stages Tuesday as a rash of power plant outages and record temperatures in= =20 San Jose and elsewhere triggered a critical shortage.=20 As was the case Monday when 1.2 million to 1.8 million customers were=20 affected Tuesday's outages were split between the northern and southern=20 parts of the state. Blackouts began at 9:30 a.m. and lasted until 2 p.m. wh= en=20 authorities obtained extra power from other Western states. Outages were=20 considered less likely today.=20 But people are preparing anyway. Like low-flow toilets and earthquake kits= =20 flashlights and generators may be emerging as another fact of life in the= =20 Golden State.=20 In San Francisco's Inner Sunset district Han Yong Park had the satisfied= =20 smile of a well-prepared man having bought a portage generator for his Park= 's=20 Farmers Market five months ago.=20 Tuesday morning the generator churned loudly on the sidewalk positioned= =20 between the tomatoes and green beans. Inside clerks tallied purchases on= =20 electric cash registers.=20 Park motioned down the street where neon signs were dark and some=20 restaurants closed. ``No one else in the area has a generator'' he said.= =20 Energy officials say such equipment will come in handy this summer. Power= =20 supplies are expected to be so strained that Californians should expect man= y=20 more rolling blackouts.=20 ``I don't want to kid anybody'' said Patrick Dorinson spokesman for the= =20 California Independent System Operator which manages the power grid for mo= st=20 of the state. ``Supplies are very very tight. When you look at such a big= =20 state and such a large shortfall I think we have to prepare ourselves. It'= s=20 very possible that going into this spring and summer we're going to see som= e=20 very difficult days.''=20 Combination of factors=20 The multiple causes that conspired to darken California on Tuesday=20 underscored the difficulty officials face in keeping the lights on.=20 The thermometer shot to record-breaking levels at some locations in the Bay= =20 Area driving up power demand. San Jose hit 83 compared with an average 66= =20 degrees for March 20 and breaking the record high of 80 set in 1960.=20 What's more 12000 megawatts of power were unavailable because plants had= =20 shut down for maintenance or because cash-strapped utilities haven't paid= =20 them.=20 And consumer conservation has been spotty. While state energy officials say= =20 conservation rose from 5 percent in January to 8 percent in February grid= =20 managers said this week Californians weren't saving enough energy. They eve= n=20 revised their estimate of how much homes a megawatt can power down from=20 1000 homes to 750 to reflect greater consumption.=20 Improved conservation later in the day helped stave off a second wave of=20 outages they said.=20 Many shrug off the threat of rolling blackouts.=20 ``I think I've gotten used to it'' said Mary Carlson 58 of San Jose who= =20 took her granddaughter for a walk and read the paper during blackouts in=20 January. ``I just go with the flow. I'm not going to get too excited about= =20 it. If they turn the power off it's no big thing.''=20 Erica Finn secretary at Acacia Glass in San Francisco said she wasn't too= =20 upset when blackouts shut down the credit card machines electric sanders a= nd=20 phones. She bought coffee pulled a chair into the sun and popped Madonna= =20 into her portable CD player.=20 ``I have to brush up on my tan and get paid for it'' she said.=20 But for others the consequences are potentially serious.=20 At a Palo Alto dental office the blackouts interrupted root canals for thr= ee=20 patients. Dentists Darrell Dang Robert McWilliams and Kurtis Finley insert= ed=20 temporary fillings by hand rescheduled the procedures and went to lunch.= =20 The receptionist used a cell phone to cancel the afternoon's appointments= =20 frustrated that there's no way to prevent a repeat of Tuesday's fiasco if t= he=20 blackouts continue.=20 A new routine=20 Others have taken everyday steps to cope with the threat of losing power.= =20 Stephen O'Reilly a 34-year-old San Jose engineer who often drives to see= =20 clients said he avoids side streets because blackouts could darken signal= =20 lights and tie up intersections.=20 ``I used to take back roads to avoid traffic but I'm trying to use the=20 freeways more because there are no lights'' said O'Reilly adding that he'= s=20 shut down his electric hot tub to help conserve power.=20 At Pasta Primavera in San Mateo manager Chris Harris has stocked up on=20 candles and has plans to buy a generator for his restaurant. When blackouts= =20 arrived just before the lunch crowd Tuesday and cut power to ventilation=20 fans he even considered revising his menu replacing smoke-producing chick= en=20 and shrimp with simple marinaras and alfredos.=20 ``I don't know if you'd want to dine with the smell of smoke'' Harris said= =20 as customers trickled into his darkened restaurant on Fourth Avenue. ``If= =20 this is going to continue through the summer it's going to affect our=20 pockets.''=20 San Francisco International Airport which agreed months ago to shut down i= ts=20 massive air conditioners to save power during shortages is now routinely= =20 stuffy.=20 On Tuesday the temperature reached a steamy 85 degrees inside the airport's= =20 North Terminal which serves most of United Airlines' flights.=20 ``It's become uncomfortable if not intolerable'' said Ron Wilson airport= =20 spokesman. ``It's like getting in a car that's been left in the sun all day= .=20 It's much hotter inside. .?.?. We've turned on the fans but they're just=20 moving the hot air.''=20 Hospitals cut off=20 Several hospitals complained they lost power Tuesday saying they thought= =20 they were exempt. PG&E said hospitals with sufficient backup generation to= =20 power themselves can be turned off. But state regulators said they could no= t=20 confirm that statement and hospital officials scoffed at the suggestion.= =20 ``Every hospital has backup power generation but it only covers 30 to 40= =20 percent of the hospital'' said Roger Richter a senior vice president with= =20 the Hospital Council.=20 Nonetheless hospitals are coping with the situation.=20 ``Our patients are concerned for sure'' said Jackie Floyd head nurse at= =20 the Satellite Dialysis Center South in San Jose which lost power. ``But=20 while it's a pain we can handle the blackouts. We're kind of getting the= =20 idea here that this a problem and we have to adjust.''=20 But while Californians may be adjusting they're not at all pleased.=20 ``I'm frustrated with this power thing'' said Ana Rivera who manages the= =20 Wash Club in San Francisco where washers and dryers had stopped mid-cycle.= =20 ``Who do you blame? No one wants to accept blame.'' Sara Neufeld Ann Marimow Kim Vo Frank Sweeney Barbara Feder Aaron Davi= s=20 Gil Duran and Dave Beck contributed to this report.=20 --- --- Powerless again=20 Outages were lighter after generators came back online and conservation=20 efforts kicked in. Blackouts may be averted today.=20 March 21 2001=20 By TONY SAAVEDRA JOHN HOWARD CHRIS KNAP and JEFF COLLINS The Orange County Register=20 The Ridgewood Power methane-burning plant at the Olinda Alpha landfill in= =20 Brea is producing 3.3 megawatts down from five because Edison owes it $1.= 5=20 million and cranking up to full power is no longer a priority Photo: H. Lorren Au Jr. / The Register ? ? A second day of statewide blackouts ratcheted up the frustration level=20 Tuesday on the streets of Orange County and in Sacramento as consumers=20 demanded solutions from politicians unable to give them.=20 There was a bit of good news though: Blackouts may be averted for the rest= =20 of the week after temperatures moderated two stalled generators came back= =20 online and conservation efforts kicked into gear.=20 ?=20 Some Orange County residents took the blackouts in stride. In Mission Viejo= =20 above the West Coast Football Club's under-16 boys team scrimmages under= =20 gas-powered lights Tuesday. The club has been running to conserve energy=20 Photo: Kevin Sullivan / The Register ? ? Consumers were able to save 900 megawatts - enough to light about 675000= =20 homes - by cutting power usage said Patrick Dorinson spokesman for the=20 Independent System Operator which oversees 75 percent of the state's=20 electricity grid. That helped the ISO halt the blackouts Tuesday afternoon.= =20 Californians are back on the conservation trail and we appreciate it=20 Dorinson said.=20 Power regulators Tuesday morning predicted there would be twice as many=20 outages as Monday when more than 1 million consumers statewide lost power = in=20 one-hour to 90-minute increments.=20 Luis Pagan an assistant at the Santa Ana Animal Shelter waits out the=20 blackout Tuesday with one of the shelter's dogs up for adoption Photo: Paul E. Rodriguez / The Register ? ? Beginning at 9:30 a.m. Tuesday blackouts tangled intersections in Costa=20 Mesa forced Huntington Beach students to study by flashlight and stilled= =20 cash registers in Santa Ana. About a half-million homes and businesses were= =20 unplugged statewide before 2 p.m. Power was restored to most of Southern=20 California by 11:30 a.m. Outages affected more than 9200 consumers in Oran= ge=20 County.=20 The ISO had expected more severe outages to hit at the peak hour of 7 p.m.= =20 but was able to keep the lights on as downed power plants came back online= =20 and imports from other states increased.=20 While outages were lighter than Monday the blackouts aggravated consumers= =20 who doubted that Gov. Gray Davis lawmakers and electricity officials are= =20 doing enough to keep the power flowing in California.=20 ?=20 Zulema Avarez left and Erica Ramirez said they were caught off-guard when= =20 the power went out so they closed the fashion store in Santa Ana where the= y=20 work Photo: Paul E. Rodriguez / The Register ? ? I think this is insane said Charlee Lang 63 of Costa Mesa. Gray Davis= =20 didn't do his job for a long time he didn't get serious until November. We= =20 need to demand immediate action be taken.=20 Bill Brannick 65 of Costa Mesa added: There's a lot of complicity here= =20 and we're just innocent victims.=20 Davis in a Sacramento news conference said he inherited California's fail= ed=20 experiment with electricity deregulation enacted in 1996 under former Gov.= =20 Pete Wilson.=20 I think a fair assessment of this situation is that we were dealt a pretty= =20 bad hand here Davis said. No (new power) plant was approved in the 12=20 years prior to my being governor.=20 With summer peak demand expected to be 16000 megawatts higher than Monday= =20 and Tuesday more days of blackouts are forecast for coming months. Though= =20 Davis has signed long-term contracts to provide California with reliable=20 energy the deals haven't yet taken effect. Some suppliers won't start=20 providing electricity until the state reaches a so-far elusive agreement to= =20 help the utilities pay off billions in debt by buying their transmission=20 lines.=20 Assembly Republican Leader Bill Campbell R-Villa Park said that the effor= t=20 to resolve the state's energy crisis was floundering in the midst of unpai= d=20 bills stalled negotiations and rolling blackouts.=20 Tuesday began with 29 percent of California's power supply off line mostly= =20 from generating plants suddenly down for unscheduled maintenance. About 30= 00=20 megawatts was missing from so-called qualifying facilities or small power= =20 producers who have not been paid $1.8 billion by cash-strapped utilities an= d=20 say they can't afford to operate. Davis said he would ask the PUC to order= =20 utilities to begin paying the qualifying facilities for any energy supplied= =20 beginning April 1 but the payments would not apply to the outstanding debt= .=20 Some smaller producers threatened to force Edison into involuntary bankrupt= cy=20 if they are not paid soon.=20 Blackouts began Tuesday two hours earlier than on Monday as the ISO called= =20 on utilities to dump 500 megawatts. It was only the second day of blackouts= =20 for Southern California but the fourth for Northern California since=20 January.=20 The Disney Resort which includes Disneyland and the new California=20 Adventure voluntarily cut back one megawatt of electricity on Monday and= =20 again Tuesday said Anaheim Public Utilities.=20 All of the reductions were in backstage areas not seen by guests said Disn= ey=20 spokeswoman Chela Castano-Lenahan.=20 In other workplaces people tried to make do.=20 Flashlight beams bobbed in aisles at a Target in Santa Ana where the power= =20 stopped at 10:30 a.m. Workers escorted customers who continued shopping an= d=20 made their purchases at battery-powered cash registers. Customers were=20 eventually asked to leave when the batteries ran low.=20 Oh well no soda no sunglasses said one woman as she headed back to her= =20 car.=20 The Metro Pointe shopping center in Costa Mesa also went dark.=20 I was in the middle of making a reservation when everything went out sai= d=20 Peggy Thomas a sales executive for Travel of America along South Coast=20 Drive. All of us here went 'Oh no it's happened to us.' =20 Said one Costa Mesa police officer as he headed for his motorcycle and a= =20 blackout-related fender bender: You can thank the governor for that one.= =20 At Hawes Elementary School in Huntington Beach Principal Marie Smith was= =20 demonstrating to her third-grade class what would happen in a blackout. But= =20 before she could flip off the light switch the power died.=20 The kids thought she was joking.=20 Register staff writers Tiffany Montgomery Sarah Tully Tapia Nancy Luna J= im=20 Radcliffe Binh Ha Hong Theresa Salinas Eric Johnson and Danielle Herubin= =20 and the Associated Press contributed to this report.=20 --- --- The iceman shunneth effects of hourlong blackout=20 March 21 2001=20 By JIM RADCLIFFE The Orange County Register=20 Ken Ackerman owner of ABC Ice House in Laguna Niguel checks on his frozen= =20 inventory during Tuesday morning's rolling blackout. The ice managed to=20 endure the hourlong power outage Photo: Jebb Harris / The Register ? ? Ken Ackerman didn't sweat much when a blackout struck his Laguna Niguel ice= =20 business at 10:30 a.m. Tuesday.=20 The walk-in freezer at ABC Ice House held 8 tons of ice. And for an hour t= he=20 temperature in there rose from 20 degrees to 45 degrees.=20 But very little melted.=20 Ackerman said most refrigerators can handle blackouts as long as outages ar= e=20 less than two hours.=20 I think people are going to get used to one-hour blackouts and realize it'= s=20 not a problem'' Ackerman said.=20 The blackouts actually were profitable for Ackerman.=20 An Irvine laboratory struck by a power outage bought 100 pounds of dry ice = to=20 preserve human tissue.=20 More blackouts through the summer could be a boon for the ice business - or= a=20 bust.=20 It could mean more ice sales -- or that his supplier has trouble filling hi= s=20 orders.=20 It's going to be an interesting summer'' Ackerman said.=20 I have no idea if we'll make more or less.''=20 Traffic will be the biggest problem if blackouts continue Ackerman said.= =20 On Monday a nearby Costco that had lost power ordered 200 pounds of ice to= =20 keep its refrigerated goods cold.=20 But dead traffic lights and congested roads made it impossible to deliver t= he=20 ice before the outage ended. Costco canceled the sale.=20 We pride ourselves on getting our deliveries made in an hour Ackerman=20 said.=20 --- --- Traffic officials are seeing red over blackouts=20 Battery backups are planned by several cities to aid confused drivers.=20 March 21 2001=20 By HEATHER LOURIE The Orange County Register=20 Traffic backs up Tuesday at Crown Valley Parkway at Forbes Road in Laguna= =20 Niguel as drivers had to navigate their own way Photo: Jebb Harris / The Register ? ? Toby Tran approached an Aliso Viejo intersection and wasn't sure what to do= .=20 Ahead of him the traffic signal was dark a casualty of the rolling=20 blackouts that struck Orange County on Monday and Tuesday.=20 So Tran kept driving smacking into an oncoming car at the corner of Aliso= =20 Creek and Enterprise.=20 It just happened a shaken Tran 29 said from his Aliso Viejo home. I= =20 tried to stop and I couldn't. There was no light. Nothing.=20 Tran's accident Monday afternoon and several others like it underscore on= e=20 of the most significant dangers looming in the threat of future blackouts.= =20 Traffic signals that fade to black when the power goes out instead of=20 converting to flashing red make wrecks far more likely because drivers=20 become confused and frustrated traffic engineers and experts said Tuesday.= =20 I didn't know what to do said Tran who was on his way to a high school= =20 jogging track. Luckily I'm alive but I'm very scared.=20 On Day 2 of Southern California's power outages worried city officials=20 across Orange County hunted for ways to respond to paralyzed intersections= =20 when state regulators pull the plug.=20 We need to be ready said Hamid Bahadori traffic engineer in the city of= =20 Orange. This thing is only going to get worse in July and August.=20 One popular idea: installing emergency battery-backup units at traffic=20 signals to keep lights flashing red during blackouts. Several Orange County= =20 cities including Irvine Laguna Niguel and Orange are already moving to= =20 install the devices as early as this summer.=20 In our minds (a flashing light) is a vast improvement over a blacked-out= =20 signal said Dave Rogers Laguna Niguel traffic engineer. On Tuesday night= =20 his city was expected to approve the purchase of the battery packs for all = 74=20 of its traffic signals.=20 Timing in this case seems to be everything Rogers said. A lot of citi= es=20 had contemplated it. We just took it that extra step.=20 John Thai an Anaheim traffic engineer cautioned that cities need to do=20 adequate research and testing before they launch into such projects.=20 There is nothing that is foolproof Thai said. All this is new territory= .=20 Some cities are also considering rolling out temporary stop signs and sendi= ng=20 police officers to more intersections.=20 Although the state's vehicle code requires motorists to treat dead traffic= =20 signals like a four-way stop motorists often blow through the intersection= s=20 police said.=20 It's dangerous said Tustin police Lt. Mike Shanahan after several=20 near-wrecks in his city during Monday's outages. People are not very good = at=20 reacting to changes in their conditions.=20 Flashing red is something that catches your eye. It's a warning that=20 something is amiss but the absence of all lights is worse.=20 RELATED STORIES=20 =01=07 How to contact your Representatives =01=07 'Current' events =01=07 The iceman shunneth effects of hourlong blackout =01=07 Powerless again =01=07 Alternative power producers cut back or shut down as payments from b= ig=20 utilities lag =01=07 O.C. saves its energy -- for blaming others =01=07 Blackout readiness on agenda --- --- Alternative power producers cut back or shut down as payments from big=20 utilities lag=20 That is a factor in blackouts=20 March 21 2001=20 By HANH KIM QUACH The Orange County Register=20 Every megawatt of electricity counts in this deregulated energy market -=20 including the five megawatts generated from the Olinda Alpha landfill in=20 Brea.=20 The methane-burning plant is producing only 3.3 megawatts now because=20 Southern California Edison owes it $1.5 million and cranking up to full pow= er=20 is no longer a priority said Martin Quinn executive vice president of=20 Ridgewood Power which runs the plant.=20 We're doing maintenance now when we ordinarily wouldn't do it. Because we'= re=20 not being paid it was a good time to cut back'' Quinn said.=20 That scenario has been playing out across the state in the past two weeks a= nd=20 was a major factor in Monday's and Tuesday's blackouts.=20 Those who provide electricity through alternative means - burning methane o= r=20 wood chips or using cleaner-burning technology with traditional fossil fue= ls=20 - are not being paid for what they sell to the big utilities. So they eithe= r=20 can't afford to produce energy or see little incentive to do so.=20 On Monday their absence from the statewide electricity grid created a=20 1300-megawatt shortfall -- enough to power 1.3 million homes.=20 Taking that much power offline meant that any burp in the system would put= =20 the state under the minimum amount of electricity needed to avoid blackouts= .=20 When one conventional Southern California plant went down because of a=20 transformer fire Monday the blackouts began.=20 If all of California's (alternative) generators were operating yesterday a= nd=20 today rolling blackouts would have been avoided'' Quinn said Tuesday.=20 Within the next couple of weeks as the weather warms and alternative energ= y=20 producers continue to try and operate without money California could see= =20 twice as many of those producers go offline further increasing the potenti= al=20 for blackouts said Jan Smutny-Jones executive director of Independent=20 Energy Producers.=20 The alternative energy producers which provide about a third of the state'= s=20 energy are deemed so crucial that Gov. Gray Davis wants the Public Utiliti= es=20 Commission to order the utilities to pay them. As drafted though the orde= r=20 would only include payment on future sales it doesn't address existing deb= t.=20 The Legislature has been working since January to halve the rates that=20 alternative producers charge utilities and to require utilities to pay for= =20 November's energy by April 1. But that bill is still moving through the=20 Legislature.=20 Small plants threaten Edison with bankruptcy=20 Smutny-Jones said that if the small generators are not paid promptly sever= al=20 will attempt to force Edison into bankruptcy probably within a week.=20 Unlike the large natural-gas generators that have been paid by the state=20 Department of Water Resources alternative energy producers are locked into= =20 contracts with utilities. Collectively Pacific Gas & Electric and Edison o= we=20 alternative energy producers about $1 billion.=20 PG&E has paid about 15 cents for each dollar it owes.=20 Obviously they're a source of generation and looking at how much load ou= r=20 customers need they're a source that has provided energy'' said Jon=20 Tremayne Pacific Gas & Electric spokesman. We've been trying in good=20 faith to make payments on energy.''=20 But Edison has not paid any money. Edison's alternative energy director La= rs=20 Bergmann said the company will not pay until larger reforms are made in ho= w=20 the producers' rates are calculated.=20 But the company recognizes that its nonpayment is causing problems.=20 To the extent that there are hundreds of megawatts that are idled here it= =20 just exacerbates the (energy) problem. ... They're facing similar problems = to=20 what we faced - they don't have sufficient (income) coming in the door''= =20 Bergmann said.=20 Plants go into mothball mode=20 Millenium Energy in Kern County is owed $40 million total by PG&E and Ediso= n.=20 On March 1 the company shut down both of its coal and petroleum coke-burni= ng=20 plants and doesn't plan to bring them back up until it is paid.=20 Millenium's plants which use a special technology to reduce emissions=20 generate 150 megawatts of energy.=20 We've gone into mothball mode our machinery just sits there on cold=20 standby'' said President Mike Hawkins. We've been delivering free electro= ns=20 to the system in the hope that the system would resolve itself. But we can'= t=20 do that anymore.=20 One biomass plant in Lassen County has scaled back from 31 megawatts to=20 eight. Burney Forest Power burns wood chips to produce energy and has only = a=20 couple weeks' supply of chips left.=20 When you don't even know what you'll get paid it's hard to say 'Let's go= =20 out and get a bunch of fuel''' said Milt Schultz the plant's general=20 manager.=20 The sad thing is (the state) really can't afford to lose us.''=20 --- --- O.C. saves its energy -- for blaming others=20 March 21 2001=20 By RICHARD CHANG The Orange County Register=20 Darkened stores were forced to turn away customers as stock manager=20 Bridgette Kelly left does here at a Linens 'n Things in Costa Mesa. The= =20 store closed for 45 minutes Tuesday morning Photo: Michael Kitada / The Orange County Register ? ? Orange County residents are making efforts large and small to conserve=20 electricity as they face rolling blackouts and surging energy bills.=20 Reactions to the early spring crisis - with blackouts throughout the state= =20 Monday and Tuesday - are ranging from confusion to rage.=20 Many residents have taken practical steps such as turning off lights they'= re=20 not using waiting until off-peak hours to do their laundry and opening=20 windows instead of using air conditioning.=20 My house is full of Philips energy-saving light bulbs said Ray Rutledge= =20 48 of Buena Park. Our light bill has dropped 7 1/2 percent. We use=20 low-voltage outdoor lighting. We've got an energy-saving thermostat. It's s= et=20 back to 65 (degrees) in the wintertime.=20 Kim Wilson who lives in an unincorporated area of Orange County near Santa= =20 Ana and Tustin said he has cut down on lighting in his house and has reduc= ed=20 by half the time his pool cleaner runs. Still his energy bill remains abou= t=20 $400 a month.=20 I don't know what ... to do Wilson 57 said. We've cut back.=20 Wilson added that he is not pleased with the way government or the energy= =20 companies have handled the crisis.=20 I think it's disgusting. It's such political garbage. Who was it that made= =20 these decisions? Who got us into it?=20 'TRYING TO CONSERVE'=20 Jenny Hann 60 of Costa Mesa said her workplace has devised an emergency= =20 plan for conservation and future blackouts.=20 We're definitely trying to conserve as much as we can the bank=20 administrator said. Hann expressed frustration with the energy companies.= =20 When you see these executives that have been running the show and the mone= y=20 they're making it's bothersome she said.=20 Jennifer Souto 27 of Tustin said even though she's a stay-at-home mother= =20 she keeps the lights off all day. She doesn't use her air conditioning=20 either.=20 Souto said she was locked out of her house for 90 minutes Monday because a= =20 blackout cut power to her garage door. She says she's not sure who to blame= .=20 Paul Finch 38 of Westminster blames Edison and Gov. Gray Davis.=20 I don't believe info I get from Edison or from our illustrious governor= =20 Finch said. There's more to it than how they've represented it.=20 --- --- Blackout readiness on agenda=20 O.C. companies braced for outages Tuesday in different ways. Not all were= =20 struck but they felt the effects.=20 March 21 2001=20 By TAMARA CHUANG The Orange County Register=20 In case of a power failure Tuesday the Fluor Corp. in Aliso Viejo stocked= =20 elevators with homemade blackout kits filled with cookies flashlights and= =20 bottles of water.=20 They're in the elevators although we've been told not to use the=20 elevators said Lori Serrato a company spokeswoman. We're using the=20 stairwells waiting for our time of darkness.=20 Tales of anxious preparation were more common than actual blackouts for=20 Orange County businesses Tuesday.=20 Edison told some companies as special power users who've agreed to cut bac= k=20 when asked to expect to do so. Conexant Systems Inc. got a warning from=20 Edison and immediately shut down air conditioning and equipment not in use= =20 and stopped production. The blackout never came.=20 Kingston Technology Co. when notified by Edison on Tuesday morning=20 broadcast the warning on the company intercom. The company also e-mailed=20 employees a guide explaining the blackout.=20 It's already affected productivity. We've been busy getting all our e-mail= s=20 out before it happens said Heather Jardin a spokeswoman for the Fountain= =20 Valley computer memory maker.=20 Kingston still had power by day's end but in an emergency the company's= =20 manufacturing plants revert to Kingston's own power generators Jardin said= .=20 Heart valve maker Edwards Lifesciences turned on its backup generators=20 Tuesday morning because of the potential for there to be a blackout in ou= r=20 area said company spokesman Scott Nelson. But (as of 3:30 p.m.) the=20 blackout didn't materialize Nelson said.=20 At the regional office in Irvine Verizon Wireless implemented conservation= =20 efforts such as motion sensors that shut off lights after 30 minutes of=20 inactivity and separate heating and air conditioning units on all floors.= =20 Some of the company's cell sites in Orange County and Los Angeles did lose= =20 power Monday and Tuesday but they automatically switched to backup battery= =20 sources.=20 Other companies - PacifiCare ICN Pharmaceuticals Beckman Coulter and=20 Allergan - said they took precautions turning out some hallway lights and= =20 communicating safety procedures to employees.=20 Disneyland Ingram Micro in Santa Ana and Western Digital Corp. in Lake=20 Forest all were prepared.=20 But none reported blackouts by day's end.=20 Some county businesses did get hit.=20 Businesses along the 900 block of South Coast Drive - including 14 stores a= t=20 the Metro Point shopping center in Costa Mesa - went dark about 10:20 a.m.= =20 All of a sudden it was dark said Henry Gonzalez manager of Boudin Baker= y.=20 We ran out of coffee. We couldn't bake anything. We tried to accommodate a= s=20 best as we can.=20 Other stores simply closed during the blackout frustrating shoppers.=20 We walked over to (Marshalls) and it was dark and there was a sign on the= =20 door that said 'Due to the blackout we're closed' said shopper Roberta= =20 Allison a West Virginia tourist. Don't they warn people here? Do they jus= t=20 whack the power off?=20 Marshalls employees escorted customers out of the store when the power went= =20 out. Other stores including Nordstrom Rack and Best Buy were not affected= .=20 Across the street from the center employees spilled out of office building= s=20 cheering and waving their hands in victory as power outages forced them to= =20 halt work.=20 Lots of people just walked out of the office to run errands said Amy=20 Bateman a loan officer at Capital Funding Group in Costa Mesa.=20 She said her office building at 940 South Coast Drive went dark for about= =20 70 minutes. Like dozens of others in the building she was working at her= =20 desk when the computers and lights went dark.=20 We've just been sitting around. We can't do anything said Bateman.=20 The blackout hit other businesses on Monday.=20 Buy.com employees spent their hour without power using their wireless=20 Blackberry pagers to answer and send e-mail.=20 The Crazy Horse Steakhouse in Irvine lost power after the lunch rush said= =20 Donna Mulkey the restaurant's manager. Since the broilers remained hot th= e=20 cooks kept cooking and the customers kept eating. When they finished waite= rs=20 calculated the bills by hand.=20 At Broadcom Corp. in Irvine the power went out just before Rep. Christophe= r=20 Cox was to tour the facility.=20 It struck me as particularly ironic Cox told members of the House=20 subcommittee on energy and air quality Tuesday that Broadcom's co-founder= =20 Henry Samueli spent the hour before the meeting using a letter opener to= =20 open his paper mail and sitting by the window so he could get some sunlight= =20 to read.=20 Cox R-Newport Beach told the panel which was holding a hearing on=20 California's electricity crisis that the entire company could not functio= n=20 during this period of time and the same was true for more than a million=20 people he said. It's a Third World experience in California.=20 Register reporters Chris Farnsworth Dena Bunis Bernard Wolfson Nancy Lun= a=20 Eric Johnson Elizabeth Aguilera and Jennifer Hieger contributed to this=20 story.=20 --- --- Calif To Order Utils To Pay Small Generators Up Front-Gov 03/21/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 SACRAMENTO Calif. (AP)-- California regulators will order the state's two= =20 largest utilities to pay small independent power generators in advance a= =20 move Gov. Gray Davis hopes will bring a quick end to the blackouts that=20 darkened California this week.=20 Davis accused PG&E Corp. (PCG) unit Pacific Gas & Electric Co. and Edison= =20 International (EIX) unit Southern California Edison of taking in money from= =20 customers while failing to pay the generators known as qualifying=20 facilities which produce up to one-third of the state's power. As a result= =20 he said the utilities are partly responsible for this week's blackouts.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators the governor said at a Capitol news conference Tuesday= =20 evening. They've acted irresponsibly and immorally and it has to stop.=20 The state lost about 3100 megawatts or enough electricity to power 3.1=20 million homes on Tuesday from alternative energy plants that say they can'= t=20 afford to keep operating because the utilities haven't paid their bills in= =20 weeks. The utilities which are near bankruptcy owe the QFs about $1=20 billion. Pacific Gas & Electric has made partial payments.=20 As reported by Dow Jones Newswires Southern California Edison met with=20 representatives of the governor Tuesday to discuss plans to begin making=20 partial payments to the QFs. Pacific Gas & Electric which called Davis'= =20 statements inappropriate and unjustified said it has informed the QFs an= d=20 the governor's office that it plans to begin paying the QFs in full going= =20 forward.=20 Davis said the PUC planned to issue an order next week directing the=20 utilities to prepay future bills to the QFs.=20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices which the state's 1996 deregulation= =20 law prevents them from passing on to ratepayers. California has been spendi= ng=20 about $45 million a day since January to buy power for the utilities'=20 customers but hasn't included QF-generated power in its purchases.=20 Keepers of the state's power grid were cautiously optimistic that Californi= a=20 might get through Wednesday without another day of rolling blackouts after= =20 two idle plants were returned to service. A Stage 1 power alert the mildes= t=20 of three forms of alerts was called around 6 a.m. Wednesday as power=20 reserves fell to around 7 percent.=20 About a half-million customers were hit by Tuesday's blackouts which snarl= ed=20 traffic and plunged schools and businesses into darkness from San Diego to= =20 the Oregon border. Tuesday's outages began at 9:30 a.m. and continued in=20 90-minute waves until about 2 p.m. when the ISO lifted its blackout order.= =20 They were blamed for at least one serious traffic accident.=20 The blackouts were caused by a combination of problems including=20 unseasonably warm weather reduced electricity imports from the Pacific=20 Northwest numerous power plants being shut down for repairs and the loss o= f=20 power from QFs.=20 Meanwhile a leading lawmaker on energy issues said the PUC may soon have t= o=20 raise rates by about 15% to cover the state's costs and its utilities' bill= s.=20 My sense is that people will appreciate having some certainty and being ab= le=20 to plan for it said Assemblyman Fred Keeley. They don't have to like it= =20 but I think they'll appreciate it.=20 Davis has said he is confident the utilities and the state can pay their=20 bills without further rate increases.=20 --- --- PG&E Says It Is Negotiating With Qualifying Facilities 03/21/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 (This article was originally published Tuesday)=20 =20 LOS ANGELES -(Dow Jones)- PG&E Corp. (PCG) unit Pacific Gas and Electric Co= .=20 said Tuesday it is offering small generators or qualifying facilities= =20 prepayment of $200 million per month so they will have the funds to return = to=20 the state power grid.=20 But high level sources at the qualifying facilities who are involved in the= =20 negotiations said PG&E's proposal is incomplete and doesn't address the iss= ue=20 of past due payments.=20 The sources said PG&E had discussions with some qualifying facility operato= rs=20 last week regarding the plan and it wasn't accepted at that time.=20 About 3000 megawatts of power from qualifying facilities or QFs have bee= n=20 off the state's grid since Monday because the generators weren't being paid= =20 by utilities and couldn't afford to continue operating. The QFs unavailable= =20 power was partly responsible for Monday and Tuesday's statewide rolling=20 blackouts.=20 Also Tuesday California Gov. Gray Davis will hold a press conference to=20 discuss progress made in negotiations with the QFs to revise their contract= s=20 with the state's two nearly-bankrupt utilities so that the utilities pay le= ss=20 for power.=20 Edison International (EIX) unit Southern California Edison also said Tuesda= y=20 it intends to make partial payments on an ongoing basis to some QFs.=20 Edison executives met with Gov. Gray Davis' negotiating team Tuesday to=20 discuss how and when SoCal Ed can begin to make payments and a spokesman= =20 said they hope to have a plan in a matter of days.=20 Pacific Gas & Electric Co. has made partial payments of about $51 million t= o=20 the QFs it contracts with but owes much more. Edison owes the QFs hundreds= =20 of millions of dollars and hasn't paid the QFs since November. Together th= e=20 two utilities owe QFs about $1 billion.=20 PG&E said it has been collecting about $400 million per month from ratepaye= rs=20 to pay QFs and other generators with which it has bilateral contracts the= =20 state grid operator for spot power purchases and costs of its own=20 generation.=20 The average combined bill for those costs exceeds $1.4 billion per month= =20 PG&E said.=20 This mismatch between revenues and costs requires tough choices. Since the= re=20 isn't enough money in rates to cover all these costs the Public Utilities= =20 Commission decision on how this $400 million will be allocated going forwar= d=20 will determine our ability to make advance payments to QFs said Gordon R.= =20 Smith the utility's president and CEO.=20 The PUC is responsible for implementing the legislation which allows the=20 state to buy power and will decide how much of utilities' ratepayer revenue= =20 will go to the state for power purchases and how much will go to the=20 utilities.=20 For several weeks a number of QFs have taken their generating units offlin= e=20 because they can no longer afford to buy fuel needed to run their units.=20 QFs supply California with one-third of its total power supply.=20 PG&E and SoCal Ed have almost $13 billion in purchased power undercollectio= ns=20 because they cannot collect full costs from customers protected by a=20 state-mandated rate freeze.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 -(Jason Leopold contributed to this article.)=20 --- -------------------- Wednesday March 21 2001=20 By Dave Todd=20 dtodd@ftenergy.com=20 U.S. Energy Secretary Spencer Abraham declared this week that the Big Apple= =20 is on the verge of being bitten hard by power cuts and rising energy prices= . Delivering the keynote address at the U.S. Chamber of Commerce's national= =20 energy summit in Washington Monday Abraham said California is not the on= ly=20 state facing a mismatch between supply and demand what with electricity= =20 shortages predicted for New York City and Long Island this summer and low= =20 capacity margins threatening electricity reliability elsewhere across the= =20 country. But how likely is it that New Yorkers will face blackouts of the= =20 sort confronting Californians?=20 Not very says energy trade specialist Edward Krapels managing director of= =20 Boston-based METIS Trading Advisors. Krapels a consultant helping major=20 Northeastern utilities such as Consolidated Edison design market-hedging= =20 programs adamantly decried what he said are facile comparisons between=20 conditions in New York and California there being more differences than= =20 there are similarities between those two industrial cornerstones of the=20 country's economy in respect to energy security management.=20 First of all New York has a more varied portfolio of energy generation=20 sources than California he said. California has hydro nuclear and gas b= ut=20 when it lost a lot of hydro the state needed gas to pick up the slack and= =20 the capacity just wasn't there. In New York's case the state has oil and= =20 coal still in the mix and its overall dependence on gas is much lower than= =20 California's Krapels added.=20 New York avoids making same mistakes Portfolio diversity is one pillar of any effective plan to help New York=20 avoid the same errors made in redesigning California's marketplace. New=20 York's Independent System Operator (ISO) in a new report warning that the= =20 state is at an energy crossroads in terms of its capacity adequacy in the= =20 immediate future argues that a concerted effort is required to arrest=20 declining in-state generation capacity reserve margins and a strategy must= =20 be put in place whether or not new generation comes on-line in accordance= =20 with current anticipated scenarios.=20 A measure of New York's essential difficulty is that between 1995 and 2000= =20 statewide demand for electricity grew 2700 MW while generating capacity= =20 expanded by only 1060 MW. With no major new generating plants in downstate= =20 New York fully approved the gap is expected to continue to widen. To avoid= =20 a replication of California's market meltdown the New York ISO calculates= =20 the state's daily generating capacity needs to grow by 8600 MW by 2005 wi= th=20 more than half of that located in New York City and on Long Island.=20 Expressing concern this may be too big a burden for the current bureaucrati= c=20 process to bear the ISO wants to see a state-appointed ombudsman named to= =20 help would-be merchant power plant investors plow through red tape.=20 Increasing New York's generating capacity will also lessen the state's=20 escalating and risky reliance on out-of-state sources of electricity the= =20 ISO added. Since 1999 New York State has been unable to cover its reserve= =20 requirements from in-state sources.=20 Not everyone agrees with that analysis insofar as it argues for circling t= he=20 wagons inward. Some analysts believe the ultimate solution lies not in tyin= g=20 in more inwardly dedicated power but in expanding the marketplace by=20 breaking down inter-jurisdictional barriers. In any case New York energy= =20 regulatory authorities and those responsible elsewhere in the U.S. Northeas= t=20 such as PJM (Pennsylvania-New Jersey-Maryland) Interconnection and the New= =20 England Power Pool are in vastly better shape in terms of cross-border= =20 cooperation than California and its neighbors in that efforts are being mad= e=20 among various authorities toward developing an integrated regional=20 electricity market. In California by contrast the state's focus=01*for=20 example in the case of new gas-fired power plant development=01*has been t= o=20 ensure dedicated supply to the California market alone rather than on a=20 regional marketplace.=20 The New York ISO's new broad-based analysis of market-restructuring needs= =20 argues that the relatively stronger health of its reformed environment is= =20 due in large part to the ability of New York's utilities to enter into=20 long-term power contracts.=20 What needs to be done most it says is to move aggressively to build some = of=20 the more than 29000 MW of proposed new generation in the siting pipeline.= =20 In the meantime the 30200 MW of electricity New Yorkers used on a peak da= y=20 last summer shouldn't be eclipsed on too many days this coming summer (give= n=20 early long-range weather forecasts). Demand however is expected to increa= se=20 at an annual average rate of up to 1.4%.=20 So while New York City the rest of the state and adjacent parts might=20 breathe easy this year it could be a brief rest from the fray. Meanwhile = a=20 4% shortfall is still being planned for this summer that is not yet provide= d=20 for as authorities hurriedly seek to arrange new generation plants around= =20 Manhattan on Long Island and even on barges offshore.=20 One way or another whether it is the weather or the politics of siting new= =20 energy facilities it's going to be a hot time in the city.=20 Long-term solutions hit brick wall Meanwhile attempts at longer-term solutions continue to run into trouble.= =20 Last week Connecticut state regulators came out against a proposal to run = a=20 new underwater cable under Long Island Sound that Hydro-Quebec subsidiary= =20 TransEnergie U.S. Ltd. wants to build to pump more juice into Long Island= =20 Power Authority's load pocket. Despite strong promises from TransEnergie to= =20 be diligent in avoiding damage to oyster beds in Long Island Sound the=20 proposal failed to convince authorities who were persuaded the pipeline=20 project could lead to diversion of electricity from Connecticut.=20 In similar fashion private companies wanting to build 10 small independent= =20 power plants and temporary generators offshore New York City are running in= to=20 intense opposition from environmental groups and citizen organizations=01*s= ome=20 of whom have taken their cases to the state assembly in Albany.=20 The David vs. Goliath nature of such controversies has further alerted ener= gy=20 companies to the difficulties of addressing complex energy supply issues th= at=20 may ultimately devolve to people not wanting things in their backyard=20 regardless of what the alternative might mean to their fellow citizens or t= he=20 greater public good.=20 But suddenly in New York California's troubles=01*while still distant in = their=20 intensity=01* may not be so far away. By some estimates this summer's bill= s for=20 Consolidated Edison customers could be up as much as one third or more over= =20 last year's charges.=20 Letting the time slip when it comes to building new infrastructure isn't=20 going to make the pain go away.=20 =20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - JS5/8/2001 Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Crisis Update (No. 10) Body:: We have been pulling together these weekly(sometimes more often) summaries for internal purposes. Would you find it helpful to be on the distribution list? Hope you are doing well. Look forward to touching base soon. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: BLM/Forest Service Right-of-Way Update Body:: Preliminary congratulations!. Looks like a good plan. Keep me posted. Stephen D Burns@ENRON 07/19/2000 01:47 AM To: Richard Shapiro/HOU/EES@EES James D Steffes/HOU/EES@EES cc: Scott Bolton/Enron Communications@Enron Communications Joe Hillings/Corp/Enron@ENRON Chris Long/Corp/Enron@ENRON (bcc: Steven J Kean/HOU/EES) Subject: BLM/Forest Service Right-of-Way Update The Senate voted on the Interior Appropriations Bill late yesterday. Our amendment passed which prevents either BLM or the Forest Service from enacting new fiber optic federal lands rights-of-way policies. The BLM made a last ditch effort to defeat this in the Senate but we had reached key Senators and staff and they got nowhere. Action now moves to Conference which for us means a focus on the House Conference members. Scott and I will spend the next 2 days meeting with the key Republicans in the House. We've already recruited the important Democrats. Interior Approps Subcommittee Chairman Regula remains opposed at least publicly but we think we can get other Members to swing him. We trust he'll come up with a sensible face saving compromise on his own eg formally beginning a review process with his Subcommittee having oversight -- at this point our language literally forbids BLM or Forest Service from even meeting to discuss the issue. We continue though on several other fronts: 1. We have the New Dems writing OMB on the issue and several Senators and Congressmen writing BLM and USFS 2. We've increased the pressure on the White House and are letting them know through very senior back door channels that in our opinion BLM/Forest Service have not gotten the message. Our position is that we'll be satisfied that they've changed their evil ways when the new assessment on the Mt. Hood EBS build is retracted. 3. We're preparing both Senate and House authorizing Committees for the longer-term issue next session. We have no trouble finding champtions eager to own the issue 4. We're engaging the Western Caucus for same 5. Our adhoc coalition continues to grow in numbers and clout with over 20 companies and associations now actively engaged. Enron chairs this initiative with a tangible side benefit being much increased visibility and stature as a serious communications player. 6. Scott is successfully engaging state and local officials to weigh in from the end-user perspective BLM is on the retreat and has asked for a meeting which we've refused. We don't think they've given up though and it's likely an issue of pride at this point. So until the Approps process concludes we're continuing with the full court press. Steve What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Hold for EES budget meeting. Body:: You speak at 1:10 Central time. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Merger on FERCs Agenda Body:: Wow! Was this expected? Sarah Novosel@ENRON 07/19/2000 03:52 PM To: Fullenweider Keith cc: J Mark Metts/HOU/ECT@ECT Mitchell Taylor/Corp/Enron@ENRON Ann Ballard/Corp/Enron@ENRON Steven J Kean/HOU/EES@EES 'rshapir@enron.com' Joe Hartsoe/Corp/Enron@ENRON Tim Belden/HOU/ECT@ECT Mary Hain/HOU/ECT@ECT Paul Kaufman/PDX/ECT@ECT Adam jrutkows@llgm.com 'mmelnyk@llgm.com' 'sbehrend@llgm.com' 'mike@tonkon.com' JAY DUDLEY/ENRON Pamela Lesh/ENRON Subject: Merger on FERC's Agenda The Sierra/PGE merger is on FERC's agenda for FERC's July 26 meeting. Please call me if you have any questions. We'll keep you posted. Sarah Fullenweider Keith on 11/29/99 06:12:51 PM To: J Mark Metts/HOU/ECT@ECT Mitchell Taylor/Corp/Enron@ENRON Ann Ballard/Corp/Enron@ENRON Steven J Kean/HOU/EES@EES 'rshapir@enron.com' Sarah Novosel/Corp/Enron@ENRON Joe Hartsoe/Corp/Enron@ENRON Tim Belden/HOU/ECT@ECT cc: Paul Kaufman/PDX/ECT@ECT McWilliams Douglas E. Wenner Adam Bruner Becky Decker John 'jrutkows@llgm.com' 'mmelnyk@llgm.com' 'jklauber@llgm.com' 'sbehrend@llgm.com' 'mike@tonkon.com' Subject: FW: Granite Update Attached is an update memo from Paul Kaufman on state issues. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: ENE Officer Elections Body:: No. We have reallocated some of the responsibilities but Cindy has a significant part of the HR organization and continues to manage Community Relations so her title is accurate. Thanks From: Kelly Johnson/ENRON@enronXgate on 07/19/2001 01:06 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: RE: ENE Officer Elections Thanks Steve. Do we need to change Cindy Olson's title? Let me know. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Technical Corner for today Body:: Sam We can use a piece written by Rakesh on liquidity. I shall ask him to send it to you. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Luntz Focus Groups (1 of 4) Body:: We don't have revised versions yet. when we do we will probably only want to put some (not all) of the documents on the intranet. Gavin Dillingham@ENRON_DEVELOPMENT 08/24/2000 02:06 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: RE: Luntz Focus Groups (1 of 4) Have we received the newly revised principles facts and statements for the Luntz Focus Groups? I was hoping to place these on the California power issue database. Thanks Gavin ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Draft of Organizational Announcement Body:: I'm not sure yet. I think we are going to be sending two memos -- one that I am working on and on that Andy is working on. It looks to me like the message below fits better into Andy's memo. I don't think they will be combined into one but I'll know more tomorrow. From: Sherri Sera/ENRON@enronXgate on 06/11/2001 04:51 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: FW: Draft of Organizational Announcement Steve Kevin Garland sent this to me hoping to get Jeff's approval to send it out from the office of the chairman. Would it make sense to incorporate it into the memo you're working on? Please advise. Thanks SRS What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: thank you Body:: fyi What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: AGA Body:: What have they done for us? Terence H Thorn@ENRON_DEVELOPMENT 10/03/2000 08:30 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: AGA Steve I need your help. Twice in the last three months I have run into the Chairman of AGA who has taken my head off for Enron not renewing its AGA dues. I understand that the dues had been paid by Stan Horton who had decided that the pipeline group with INGAA representing it had no need for and received no benefit from the membership. I guess a few years back when AGA kicked the pipelines out they renegotiated the dues into some type of sub membership for around 85K. AGA approached the gas marketing team and talked to Mike Roberts about renewing the membership and maintaining relations with his customers and later to Jeff Shankman who passed them off to some other person and never got back to them as promised. This is a heads up to tell you that Bob Catell of Brooklyn Union fame- one of Enron's oldest customers and friends will be calling Lay. It seems to me that pro rating the dues among ENA and EGM and maybe GPG might be a solution. Anyhow I promised to pass on the complaint. Thanks. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Our Will Body:: no objection Robert Kean on 04/30/2001 10:00:52 AM Please respond to To: Phil Kean \(E-mail\) Doug & Karen Reiman \(E-mail\) Kathy Wedig \(E-mail\) Steve & Melissa Kean \(E-mail\) cc: Diane Kean \(E-mail 3\) Subject: Our Will Phil Karen Kathy Steve Diane and I are finally getting a will written. I would like to ask all of you if you have any objections to being named in the will as executors OR executing an Advanced Health Care Directive. An AHCD is document inwhich Diane and I will state what our wishes are regarding life support. I have attached a sample copy for review. If anyone objects please reply to me in the next 10-14 days. We will be meeting with the lawyer sometime around the 15th or 16th. Rob - Advance Health Care Directive.pdf What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Sandy Fain Body:: Randy Rich in town What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: DRAFT - AA PRC MEMO Body:: Looks fine to me. I have not cross checked the lists but I assume you have included everyone who was designated to serve on the PRCs per the original memo (in addition to the new bus unit additions) Billy Lemmons 04/30/2001 06:41 PM To: Steven J Kean/NA/Enron@Enron John Sherriff/LON/ECT@ECT cc: Ted C Bland/Enron@EnronXGate Teresa Bosien/Enron@EnronXGate Subject: DRAFT - AA PRC MEMO Attached is a draft memo (including attachments) outlining the modifications we discussed last week. We can communicate changes by email or I'll be happy to arrange a short conference call. If possible I would like to distribute this by Wednesday or Thursday of this week. After the four of us reach consensus I suggest we preview Cindy (and maybe the HR heads) prior to distributing. You will note that based on conversations I had with Skilling last week (where he emphasized his desire that we have one program rather than a fractured program by business unit) I have added a review of the business unit distributions to the final meeting where we discuss the top perfomers. I've also added Janet Dietrich (tent.) and another EES person (tbd) to the AA Committee since they have a large group of AAs and no representation on the committee. Please let me know if you have any questions or comments and thanks for your help. Ted and Terry did all the hard work. Regards Billy Click Print Preview or print a hard copy - it's easier to read. We do not have the Europe groups included. Should probably include or note in the memo itself that info is forthcoming. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Digital Power Demand: JP Morgan Report Body:: Please post the JP MOrgan doc. on our site What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Town Hall Los Angeles Body:: mo - calendar Rob - fyi upcoming speech ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RESUME Body:: ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: AW: Houston-Frankfurt Body:: Another bit of background re Frankfurt (see below). I would be a little bi= t=20 more insistent on German Consulate support than Herr Sturm suggests=20 (otherwise this could become a black hole for your time). ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Rice Team Mtg. Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Contact data and RFI Body:: Kevin I just got the attached e-mail returned with your new address. Let me know if this one makes it thru Fred Confidential Kevin I know you are quite busy but I wonder if you could get your lead trader to look the following forecast for NEEPOOL. This may result in you getting the lead for a large block of the power so be conservative but have enough in there so it is a win win if you know what I mean. Have him fill in what he can. The client will be looking long 10 year with maybe a series of 2 and 5 year deals. Should be putting out around 500 to 700 Mwe. Do not disclose the plant eh ? Call me at 864-370-0217 or 864-235-5607 or mobile 864-275-3193 Thanks Fred What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Regulatory Roundtable, in 49C2 Body:: PFI -- Clement TVA 2024672778 Christa Donahue Cong BURR NC 202 383 2260 Maya Weber Mcgraw Hill Martin Wenzel What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: INVITATION Body:: Molly Thanks. I shall join you. I assume it's Ninfa's on West Dallas. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: CONFIDENTIAL - Disclosure Schedules Body:: Attached please find a draft of the financial schedules prepared by Enron Corp. Please call or email me if you have questions. Mike McGown <> - Summer financials sent to V&E 8_2_00.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: In Washington DC - Breakfast with Jim Bayless at 8:00 in Willard Coffee Shop, then 3 interviews set up by Carolyn, approx. one hour each. Body:: Lunch with Joe Hartsoe at 12:00 Return to Houston on 5:20 flight. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I have opened a new Lotus file California - working group where I am keeping the contact information but I am assuming you have picked everybody up already. If in doubt check out the file. thanks What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - Job Description Body:: FYI...I'll keep you informed. dave ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: UC/CSU press release Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Enrons PaineWebber Service Body:: Thanks for getting on top of this. Please get the word out to the HR team leaders as soon as you know more. From: Aaron Brown/ENRON@enronXgate on 07/13/2001 11:36 AM To: Steven J Kean/NA/Enron@Enron Mary Joyce/ENRON@enronXgate cc: Subject: Enron's PaineWebber Service Rocky Emery the Dowd family Kim Bowden and another 15 or so employees of UBSPaineWebber (our stock tracking provider...options restricted stock etc) left yesterday evening without any warning. They went to 1st Union. I've set up a meeting at 2pm today for us to go over to UBSPW and make sure they understand the special needs of Enron and to make sure our service will not be affected. I am reviewing the contract in place between PW and Enron to understand the affects of this move by Emery and his staff on the agreement. Also I'm going to see about getting 2 providers of the stock tracking service from the following list: (in case this happens again we'll have a solid back-up immediately) UBSPaineWEbber (our current provider) 1st Union (where Rocky Emery went) Solomon Smith Barney (way ahead of the competition from a technology standpoint...and has done the two provider thing before) Prudential (another option with internal connections) let me know if you think I should include any others or would like to discuss. Thanks Aaron What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Expatriates in India Body:: John Brindle David Cromley and others in the Corporate Business Controls group (formerly part of EBS) have been working over the last several weeks to make sure that we can get our people out of Dabhol if there are threats to their safety. While no plan is perfectly reliable (particularly during monsoon season) we believe that we are as ready as we can be. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Interview Request Body:: Thanks for the referral. We definitely want to get our story out to these guys. Just for future reference Meredith Phillipp is handling New Media for us. Thanks Janel Guerrero@ENRON 07/19/2000 05:52 PM To: Steven J Kean/HOU/EES@EES Mark Palmer/Corp/Enron@ENRON cc: Subject: Interview Request Hi guys. My friend Polly Traylor is an editor at the Industry Standard in San Francisco. One of her colleagues -- Michelle Rafter -- sent me the email below requesting an interview for an Enron story she is working on. I have not spoken with this writer and am forwarding it to you for follow up. Hope all is well. Call me if you have any questions. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Idea Body:: If you think this is worth pursuing get in touch with Christie. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION Body:: For you to add the wire instructions which are in my out box. Mark What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EFET paper on acceleration of energy liberalisation in the EU Body:: Please forward to public affairs group. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Daily Update / Legislative Update - 8/23/00 Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Expertfinder - The Power of Who Body:: FYI - this email will go out to employees tonight. The Enron Corporate Policy Committee introduces Expertfinder. Expertfinder allows you to locate people within the Enron community by organization structure skills reporting relationships languages school attended and prior work experience. Expertfinder is a secured HR application that is available upon completion of your Certificate of Compliance. Expertfinder can be accessed on the Enron Intranet by typing the following URL at the Internet Explorer command line and Log In using the HRGIS Id provided below: https://hrglobal.enron.com Your HRGIS Id: Your Password: Date of Birth (Format YYYYMMDD) *Current users of the Global Launch Zone will maintain the same password. If you don't remember your password click on Forgot ID/Password below the Log In button. Should you have any questions regarding access or data issues in Expertfinder contact the HRGIM Line (HR Global Information Management) at 713-853-5666. Expertfinder is only as good as the data provided. Does your personal data need updating? Go to eHRonline.enron.com or (Eastern Hemisphere only) to update your data today. Or contact your HR Generalist for business unit related updates. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Job candidates for Enron Body:: Thanks for the note. I am forwarding it on to our analyst and associate recruiting program leaders. We may have already filled the summer spots (we also cut down the number a bit this year to ensure a higher quality experience) but we will be out looking for a large number of permanent hires in the Fall. Severin Borenstein 03/31/2001 06:00 PM To: Steve Kean cc: James Bushnell Subject: Job candidates for Enron Dear Steve: Jim Bushnell and I are teaching a course called Energy Market Strategies and Policies this semester. The course is cross-listed between the Haas School of Business and the Energy & Resources Group at UC Berkeley. The syllabus for the course is attached. We have 43 graduate students in the course most pursuing a masters degree in business or energy & resources though there are also a few PhD students. These are very smart students -- many of whom already have experience in the energy industries -- and we believe the course puts them in a position to immediately contribute to any energy-related organization that they would join. Many of these students are interested in either summer or permanent employment starting as early as May. If Enron has openings that you would like to advertise to these students please send me the job description (or the URL for it)and I can forward it to the class list. Jim and I think this is a very strong class and many of the students are interested in making a career in either the business or the public policy side of the energy industry. We're hoping to provide the connections to help make sure they find the best job matches possible. Sincerely Severin Severin Borenstein E.T. Grether Professor of Business Administration and Public Policy Director Haas School of Business U.C. Energy Institute University of California 2539 Channing Way Berkeley CA 94720-1900 Berkeley CA 94720-5180 (p) 510-642-3689 (p) 510-642-5145 (f) 707-885-2508 http://www.ucei.org Email: borenste@haas.berkeley.edu WWW: - EnergyMarketsSyllabus.pdf What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Proposed Ad for the Ontario Market Body:: looks good. Rosie you may want to include this in ken's file for the toronto trip Eric Thode 03/16/2001 08:56 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: Proposed Ad for the Ontario Market I sent this to Rick Shapiro and Mark Palmer as well. This is an ad created for use in the Ontario market and would include the logos of the signatory companies (rather than individual signatures).Aleck Dadson worked with GPC on its creation. It is part of the total plan which includes Ken Lay's visit to Toronto April 4 to meet with media and government leaders. Give me your thoughts. Eric ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: BY MARK GOLDEN A DOW JONES NEWSWIRES COLUMN NEW YORK (DOW JONES)--THE CALIFORNIA SENATE IN SACRAMENTO PASSED A WINDFALL-PROFITS TAX ON SALES OF ELECTRICITY INTO THE STATE'S WHOLESALE ELECTRICITY MARKET MONDAY AFTERNOON AT 4:50 P.M. PDT. AT ALMOST EXACTLY THE SAME TIME CALIFORNIA INDEPENDENT SYSTEM OPERATOR INITIATED ROLLING BLACKOUTS FOR THE FIRST TIME SINCE MARCH. COINCIDENCE? PROBABLY BUT THE CONNECTION SHOULDN'T BE IGNORED. THE POLICY DECISIONS THAT HAVE BEEN ADOPTED IN CALIFORNIA TO DATE HAVE ACCELERATED AN ALREADY SERIOUS MARKET COLLAPSE SAID A HARVARD UNIVERSITY STUDY OF CALIFORNIA'S ENERGY CRISIS LATE LAST MONTH. THIS WEEK'S WINDFALL-PROFITS TAX BILL IS THE LATEST BLUNT INSTRUMENT WIELDED WITH POTENTIALLY DISASTROUS RESULTS. GOV. GRAY DAVIS WANTED IT AS A STICK WHEN (CONT) MEETING WITH EXECUTIVES FROM THE STATE'S MERCHANT POWER COMPANIES WEDNESDAY. THE MANEUVER WAS LESS THAN ADROIT AND THE GENERATORS WEREN'T IMPRESSED. AFTER THE MEETING WITH DAVIS RELIANT ENERGY'S (REI) JOHN STOUT SAID THAT IF THE TAX WERE IMPLEMENTED IN CALIFORNIA IT WOULD INSTANTLY BLACK OUT ALL THE GENERATION IN THE STATE. THE STATE'S LEADERS MIGHT KEEP IN MIND WHO WIELDS THE BIGGER STICK AT THIS POINT. CALIFORNIA SET UP A MARKET IN WHICH SELLERS HAVE BEEN ABLE TO CHARGE VERY HIGH PRICES FOR ELECTRICITY SINCE SUPPLIES STARTED GETTING TIGHT A YEAR AGO. SELLERS SAY THEY HAVE PLAYED BY THE RULES THEY WERE GIVEN AND NOBODY HAS PROVED OTHERWISE WITH THE ONE EXCEPTION OF A FINE PAID BY WILLIAMS COMPANIES (WMB) FOR ONE PARTICULAR INSTANCE OF VIOLATING A CONTRACT. IT'S LIKE SOMEBODY INVENTED A NEW GAME INVITED YOU OVER TO PLAY AND THEN CHANGED THE RULES A COUPLE OF TIMES IN THE MIDDLE OF THE GAME. THEN AFTER YOU BEAT THEM THEY INSIST YOU CHEATED SAID ONE WESTERN ENERGY TRADER. ALMOST EVERY ATTEMPT BY THE BUY SIDE - THE UTILITIES THE ISO AND NOW THE (CONT) STATE TREASURY - TO LOWER PRICES HAS RESULTED IN HIGHER PRICES OR BLACKOUTS OR BOTH. THE WINDFALL-PROFITS TAX IDEA IS THE MOST RECENT EXAMPLE BUT THOSE WHO INSIST ON PRICE CAPS SHOULD KEEP THIS IN MIND: THE ISO HAS HAD PRICE CAPS SINCE IT BEGAN OPERATION MORE THAN THREE YEARS AGO. OBVIOUSLY PRICE CAPS HAVEN'T WORKED JUST AS THEY HAVE NEVER WORKED EXCEPT DURING WARTIME. IN FACT PRICE CAPS HAVE BEEN A QUESTIONABLE MEDICINE PRESCRIBED FOR THE WRONG DISEASE. AT BEST PRICE CAPS MIGHT RESTRICT PRICE SPIKES. CALIFORNIA'S PROBLEM IS PERPETUAL HIGH PRICES. IT CAN'T AFFORD THE GOING RATE AT NIGHTTIME LET ALONE THE HIGHER MARKET PRICES DURING THE AFTERNOONS IN A HEATWAVE. CALIFORNIA MUST FIGURE OUT HOW TO PLAY BETTER THE GAME IT INVENTED. THE INSANELY COMPLICATED COMPUTER-BASED PURCHASING OF POWER ENDED A FEW MONTHS AGO AFTER THE CALIFORNIA POWER EXCHANGE WAS CLOSED DOWN BY FEDERAL REGULATORS AND THE ISO LOST ITS FINANCIAL ABILITY TO BUY POWER. THE MATCH BETWEEN THE PROGRAMS AND THE ENERGY TRADERS WASN'T EXACTLY IBM'S BIG BLUE VERSUS GARRY KASPAROV. ALMOST EVERYONE IN THE MARKET AGREES THAT THE UTILITIES' HUMAN TRADERS COULD (CONT) HAVE BOUGHT NEEDED POWER FOR BILLIONS OF DOLLARS LESS THAN THE PROGRAMS THAT THE UTILITIES WERE REQUIRED TO USE BY STATE LAW. SINCE THE DEMISE OF PROGRAMMED PURCHASING THE COMPUTERS HAVE BEEN REPLACED BY HUMANS BUT WITHOUT MUCH BETTER RESULTS. THE TEAM ASSEMBLED TO BUY TENS OF MILLIONS OF DOLLARS WORTH OF SPOT POWER EVERY DAY CONSISTS MOSTLY OF FORMER EMPLOYEES OF THE POWER EXCHANGE AND ISO AS WELL AS EXPENSIVE CONSULTANTS WITH NO ENERGY TRADING EXPERIENCE. ONE OF THE LEADERS OF THE TRADING TEAM FOR EXAMPLE IS A FORMER PUBLIC RELATIONS DIRECTOR FOR THE POWER EXCHANGE WITH NO TRADING EXPERIENCE PRIOR TO THE CURRENT JOB. AS ONE ISO EMPLOYEE WAS WONT TO SAY: IT'S LIKE WATCHING A FOOTBALL GAME BETWEEN NOTRE DAME AND ST. MARY'S SCHOOL FOR UNWED MOTHERS. AND THE SIGNING OF TENS OF BILLIONS OF DOLLARS OF FIVE- AND 10-YEAR CONTRACTS IS BEING EXECUTED MAINLY BY FORMER EXECUTIVES OF SOUTHERN CALIFORNIA EDISON - PEOPLE THAT LEFT THE UTILITY YEARS AGO TO BECOME CONSULTANTS AND ALSO DON'T HAVE TRADING EXPERIENCE. GOOD IDEAS MEANWHILE HAVE LANGUISHED. (CONT) WE ARE GOING TO INSTALL METERS IN EVERY MAJOR COMMERCIAL CONCERN IN THE STATE THIS SUMMER AND GO TO REAL-TIME PRICING DAVIS TOLD WALL STREET ANALYSTS ON FEB. 28. THAT PROPOSAL WAS GREETED BY MANY OBSERVERS AS THE MOST CONSTRUCTIVE IDEA FROM THE GOVERNOR'S OFFICE TO DATE. WHAT HAS HAPPENED TO REAL-TIME PRICING FOR CALIFORNIA'S BIG BUSINESSES SINCE THEN? NOTHING. THE PROBLEM IS THAT EVERYBODY IN CALIFORNIA IS 'SPECIAL' SAID STANFORD ECONOMIST AND CALIFORNIA ISO CONSULTANT FRANK WOLAK. EVERY INDUSTRY FROM OIL REFINERS TO INTERNET SERVER FARMS HAS HAD LOBBYISTS IN SACRAMENTO SUCCESSFULLY SECURING EXCEPTIONS TO THE RULE. MY POINT HAS BEEN THAT IF WHAT THEY DO IS SO VALUABLE THEN THEY SHOULD BE ABLE TO HANDLE THE HIGHER PRICES. BUSINESSES WITH ABOUT 10000 MEGAWATTS OF LOAD HAVE REAL-TIME METERS. EVERY ONE OF THEM SHOULD BE GETTING MARKET PRICES SAID WOLAK. (CONT) ONE OF THE GREATEST ADVANTAGES THAT SELLERS OF ELECTRICITY TO CALIFORNIA HAVE HAD IS THAT CONSUMERS HAVE FIXED PRICES SO DEMAND IS INFLEXIBLE. SELLERS KNOW EXACTLY HOW MUCH ELECTRICITY THE UTILITIES MUST BUY BASED ON TEMPERATURES AND THE TIME OF DAY WOLAK SAYS AND THEY SIMPLY SUPPLY THE MARKET JUST ENOUGH POWER AT HIGH MARGINAL PRICES. REDUCING OVERALL CONSUMPTION THROUGH HIGHER RATES WILL HELP THE STATE SOME BUT MAKING 25% OF DEMAND FLEXIBLE BASED ON PRICE WOULD GIVE THE STATE A FIGHTING CHANCE IN THE MARKET ACCORDING TO WOLAK. BUT THAT APPARENTLY IS TOO COMPLICATED OR POLITICALLY DIFFICULT. PRICE CAPS A WINDFALL-PROFITS TAX AND POLITICAL PATRONAGE JOBS FOR BUYING BILLIONS OF DOLLARS OF POWER MAY NOT SAVE THE STATE FROM BANKRUPTCY BUT THEY ARE EASIER TO SELL - OR SLIP THROUGH - IN SACRAMENTO. -BY MARK GOLDEN DOW JONES NEWSWIRES 201-938-4604 MARK.GOLDEN@DOWJONES.COM What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: expertfinder - The Power of Who Body:: I would'nt have it introduced by the corporate policy committee. I would say Enron is introducing or there is a new tool available to you. I am anxious to see how this goes over it's a great tool. From: Karen Moore/ENRON@enronXgate on 04/16/2001 05:34 PM To: Karen Denne/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron cc: Andrea Yowman/Corp/Enron@ENRON Subject: FW: expertfinder - The Power of Who Karen and Steve Could you take a quick peek at this and let me know if you have any thoughts or concerns? Thanks Karen What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: DEnron Engineering and Operational Services - DRAFT Announcement Body:: Drop the first comma in the first sentence of the third paragraph. Otherwise good to go. Mark Frevert/ENRON@enronXgate Sent by: Nicki Daw/ENRON@enronXgate 03/16/2001 08:42 AM To: Steven J Kean/NA/Enron@Enron Greg Whalley/HOU/ECT@ECT David W Delainey/HOU/EES@EES Dan Leff/HOU/EES@EES cc: Maureen McVicker/NA/Enron@Enron Liz M Taylor/HOU/ECT@ECT Kay Chapman/HOU/EES@EES Kathy Dodgen/HOU/EES@EES Barbara Keith Dodson/NA/Enron@ENRON Brian Stanley/EU/Enron@ENRON Subject: DEnron Engineering and Operational Services - DRAFT Announcement Please find attached draft announcement for your review and comment. I would like to release this on Monday (March 19th). Thanks Mark What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Palmisano left a couple of months ago to start his own business. Jeff Keeler (in our DC office) is covering John's issues. To: Steven J Kean/HOU/EES@EES cc: Subject: Thanks for the call this morning. The convention sounds interesting. On another note I was wondering is John Palmisano still works here? for you? I got a call from a conference organizer about an emissions meeting in Cologne Ger. and I think he has spoken at this gathering. I'll forward the email to you and to the emissions/coal group as well to determine our interest. Regards. Jeff What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Tax Review of California Assembly Bill No. 128 Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: test What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EnronOnline Management Report for August 1, 2000 Body:: more detailed information ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Camisea Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: EPMI protests AEPs continuation of MBRs Body:: Isn't our primary problem with AEP's internal merchant function rather than with the marketing affiliate (I realize we have problems with the affiliate too)? Can we protest continued market based rate authority for AEP until they have surrendered native load priority? Christi L Nicolay@ECT 09/25/2000 09:16 AM To: David W Delainey/HOU/ECT@ECT Ben Jacoby/HOU/ECT@ECT Ozzie Pagan/HOU/ECT@ECT Janet R Dietrich/HOU/ECT@ECT Dennis Benevides/HOU/EES@EES Raymond Bowen/HOU/ECT@ECT cc: James D Steffes/HOU/EES@EES Richard Shapiro/HOU/EES@EES Joe Hartsoe/Corp/Enron@Enron Steven J Kean/NA/Enron@Enron Subject: EPMI protests AEP's continuation of MBRs On 9/21 EPMI filed a protest (Below) against AEP/CSW's 3 year update request to continue market based rates for power marketing. The filing includes examples of discriminatory behavior on OASIS (for ATCs etc.) that potentially benefitted AEP's marketing side. EPMI has already protested Entergy's request for continuation of MBRs earlier this year and plans to protest other large utility-based power marketer MBR filings this fall. Let me know if you would like the list. Thanks. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Lous $50,000 Body:: Lou -- you may be maxed out on Franks now. Don't write a check for the August fundraiser until you have talked to Eliz Labanowski ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Interesting Idea for Enron? Body:: Interesting idea but hard to see any near term benefit. I would decline. Amy Lee@ENRON 08/02/2000 09:30 PM To: Steven J Kean/HOU/EES@EES cc: Stacy Walker/Enron Communications@Enron Communications Subject: Interesting Idea for Enron? Steve - Cindy and I discussed this and we agree there is no interest to move forward from a Community Relations/HR standpoint. We wanted to pass this along to you to see if you had any interest. Thanks! amy ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Curve Validation Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Presidential Gala, May 22nd Body:: Stay in touch with linda ro the recommendation. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Agreement Revisions -- Rio Bravo Pipeline Open Season Body:: Attached is Enron North America Corp.'s suggested revisions to your pro forma confidentiality agreement. Please review and let us know if the suggested revisions are approved. Thanks for your help Ruth Concannon Telephone: (713) 853-1667 Fax: (713) 646-8453 e-mail: ruth.concannon@enron.com What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Thanks. Look forward to seeing you. Sorry I left Jimmy off the note I know he must be doing a good job. John Ambler@ENRON_DEVELOPMENT 03/23/2001 10:11 AM To: Steven J Kean/NA/Enron@ENRON cc: Maureen McVicker/NA/Enron@Enron Subject: Re: Steve Thanks for sending this note to Wade. I'm certain that the NYT story is infinitely better because of Wade's involvement. It was a team effort but you should know that Jimmy Mogal also was very involved. Of course Wade wants to avoid damaging the company and your note helps to keep him up for these risky/must do requests. Along these line I'd like to be able to give you a brief update on activities and issues. I'll check with Maureen about scheduling 15-20 minutes. John From: Steven J Kean@ENRON on 03/20/2001 09:06 AM To: Wade cc: Johan John Subject: I just saw the NYT article. Nice job. It's nicely positioned as an issue about India's resolve to encourage foreign investment and live up to contracts. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: FYI. From today's Post. Davis seems to continue to put distance between himself and the contracts. Best Jeff Financial California Changes Stance on Refunds Two Sides Far Apart In Energy Talks Peter Behr 07/06/2001 The Washington Post FINAL Page E01 Copyright 2001 The Washington Post Co. All Rights Reserved California officials have abruptly shifted tactics in their attempt to recover billions of dollars in alleged overcharges for electricity saying they may reduce their demands for huge refunds if generators renegotiate $43 billion in long-term electricity contracts that the state signed this year. Gov. Gray Davis (D) said part of the $8.9 billion in refunds the state is seeking could be offset by reductions in energy prices in the long-term contracts whose costs have become a growing political embarrassment for Davis. We've made suggestions we've offered various ways in which people could get us $8.9 billion Davis told the San Jose Mercury News in a report yesterday. You can renegotiate our existing contracts and save us money. However you want to do it it's just got to net out close to $8.9 billion. The new offer was introduced this week into the closed negotiations over a California settlement being conducted in Washington by Federal Energy Regulatory Commission Judge Curtis L. Wagner Jr. according to sources close to the negotiations. Yesterday Wagner said he may issue his own preliminary finding today on the amount of overcharges if California officials and the generators cannot reach a compromise. What I'm trying to do is get people in a settlement mood Wagner told reporters. In the event we're unable to do that [Friday] at some point I may offer a preliminary assessment. The settlement conference is set to conclude on Monday. Wagner FERC's chief administrative judge has been trying to push both sides toward a compromise that would resolve the huge energy pricing controversy. Mountainous energy prices have bankrupted California 's largest utility drained billions of dollars out of the state treasury and put Davis at sword's point with generators that help keep the state's lights on. Last Friday Wagner rebuked Davis's chief representative Michael Kahn chairman of California Independent Grid Operator -- the state's power grid manager -- indicating that the state's demand for nearly $9 billion in refunds from power generators and marketers was too high sources said. Wagner's settlement conference which has involved more than 100 lawyers for all sides is closed to the public and media. Wagner complained last month that Kahn was following a political agenda and his lack of independence in the negotiations was such a joke that the parties might as well wear clown suits according to a Dow Jones report confirmed by sources close to the talks. But he has also criticized the generators and power marketers led by Reliant Energy Inc. Williams Energy Services Duke Energy and Southern Co. for failing to make serious settlement offers these sources said. The suppliers have offered to refund $600 million provided the state is able to call off various California lawsuits demanding far larger refunds sources said. Wagner's leverage is his ability to propose his own refund figure to FERC's commissioners. FERC has tentatively called for $124 million in refunds but now is taking a harder line on preventing a new escalation of California 's electricity prices this summer and is likely to be receptive to a higher refund figure some energy analysts believe. Davis's tactical change offering to make the long-term contracts part of an overall settlement comes amid growing criticism of what the state will have to pay for energy under those deals. California 's energy calamity stemmed in large part from its failed deregulation plan which relied heavily on short-term power purchases at volatile spot market prices. When energy costs shot upward last summer so did the state's electricity bills. In response Davis's aide S. David Freeman and his staff began negotiating long-term power contacts with suppliers. The $43 billion in deals signed so far would require the state to pay about $70 per hour for a megawatt of power for a large part of the electricity it will need over the next 10 years. That's well under the average of $250 per megawatt-hour that the state was paying at the beginning of this year but above current power prices -- and considerably higher than what electricity may cost in the next decade energy analysts say. A new agreement to lower those contract prices could relieve political pressure on Davis and focus settlement negotiations away from the state's controversial demand for the $8.9 billion refund. Davis will argue that reducing future power charges that his administration negotiated should count as a refund because the deals were reached under commercial duress according to sources close to Wagner's negotiations. Industry supporters say Davis's refund figure is impossible to justify. There's no benchmark for what a fair and reasonable price should be said Michael Zenger California director of Cambridge Energy Research Associates. The state's advocates counter that if FERC enforced a just and reasonable standard for power prices based on operating costs and a generous profit the overcharges by all sellers could easily reach the $9 billion figure. It's not rocket science but it does require the regulators to regulate said Frank Wolak a Stanford University economist who heads an oversight committee for the California grid. Those polar-opposite views have left both sides in Wagner's conference room billions of dollars apart as the talks approached their final weekend sources said. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - RS050901 Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: I couldn't open link. I s this something new for me to sign or have I already complied? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Gray Davis meeting Body:: I think the meeting is on Wednesday but if you can be there (Sacremento I expect) you should. As I mentioned in my voicemail I think the meeting will not be particularly substantive more likely it is a photo op for the governor to show how tough he is on the pirate generators. Based on your message below should we still plan to send somebody? I still think we should if we can manage the legal risk. Mike: would you be able to attend as well? From: Richard B Sanders@ECT on 05/06/2001 10:45 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: Gray Davis meeting As I indicated in my VM I will be in LA early Tues morning. Would you like to talk about the isuues before your meeting--or would you like me to go? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Report On EPSA Legislative Affairs Committee Meeting Body:: The EPSA leg. affairs cmt. met today during the fall meeting. The speakers were Howard Useem Republican counsel to the Senate Energy Committee and Jimmy Glotfelty senior policy advisory to the Secretary of Energy. Useem said Senate Energy Committee Republicans were meeting later this morning to finalize their energy proposal. (We later learned that they opted against including any electricity provisions not even the PURPA PUHCA and reliability issues that Howard thought might be included when he spoke before the senators met this is good news since it makes it less likely that anti-FERC provisions will be added.) (Howard said now is the best time to legislative on electricity because the Supreme Court has not yet acted on the bundling/unbundling issue.) On RTOs in some what of a surprise Useem said that there is general support among Senate Republicans for RTOs including consolidating them into a few RTOs of large scope (surprising since this is not what we have heard in meetings with individual Senate offices). While he said that he also said that support is stronger in the abstract than in specifics. He said the biggest opposition was coming from very vocal state regulators (EPSA staff did a good job of pointing to state regulators mainly in the Midwest who support larger RTOs). Most importantly Howard said none of the senators on his committee take a not over my dead body approach to RTOs. Jimmy Glotfelty explained to several EPSA members who asked questions just why it is that the Administration wants Congress to be silent on RTOs. He said while they would prefer a sentence or two affirming FERC's authority they do not believe this is what would come out of the legislative process. They are not willing to run that risk. He stressed that the president wants to include other electricity issues. He said they were very close to an agreement with Western governors on regional transmission siting. Jimmy further said that the Administration also wants silence on incentive rates another issue where FERC can act now. They continue to talk to Barton and his staff in an attempt to get them to back away from the restrictive approach to RTOs in the Barton discussion draft. (He said Pat Wood spent several hours with Barton and other House committee staff yesterday.) Of concern Jimmy said something like could be 4 RTOs could be 8 RTOs what is important is getting standard design. He also said DOE will make sure that PMAs are included in RTOs. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Jim Noles Named CEO of Enron Wind Body:: Congratulations! ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Expatriates in India Body:: John Brindle David Cromley and others in the Corporate Business Controls group (formerly part of EBS) have been working over the last several weeks to make sure that we can get our people out of Dabhol if there are threats to their safety. While no plan is perfectly reliable (particularly during monsoon season) we believe that we are as ready as we can be. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Utilities, Electric: Deregulation: Electricity Crisis Cools Down a Bit in San Diego County, ... Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Follow up -- Council of Energy Advisors Body:: I doubt that this is worth the trouble (i.e. running it through a conflict of interest check ensuring no liability for actions taken on the advice etc). From: Sherri Sera/ENRON@enronXgate on 06/21/2001 10:13 AM To: Steven J Kean/NA/Enron@Enron cc: Joannie Williamson/ENRON@enronXgate Subject: FW: Follow up -- Council of Energy Advisors Steve we have no record of receiving the original invitation but is this anything you would recommend? Please advise. Thanks SRS What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: LEAK Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: AG letter - privileged and confidential: request for legal advice. Body:: The letter looks good. A couple of comments for your consideration: On page three we describe the change to the definition of Public Utility an= d then argue that we don't fit into it. Would it be worth explaining why t= hat makes sense? Specifically the New Jersey restructuring law like most= efforts of its kind in other markets is designed to separate the competit= ive from monopoly elements of the power (and gas) businesses. Economic reg= ulation would then be restricted to the remaining monopoly elements of the = business (eg distribution). The competitive market can not be solely relie= d upon to regulate the behavior of monopoly asset owners such as distrib= ution utilities. Therefore regulators continue to be called upon to set p= ricing and other terms of service. What those regulators decide matters a = great deal to those monopoly utilities and it consequently makes sense for = lawmakers to be concerned about attempts by such entities to use campaign c= ontributions to tacitly influence decision makers. The same public policie= s simply do not apply to that portion of the market which is competitive. = The generation and sales business has a competitive structure (i.e. relativ= ely low barriers to entry multiple competitors etc.). These components of= the power and gas business can be regulated by the market with respect t= o rates and terms of service. They do not require economic regulation any = more than grocery stores department stores appliance sellers or other re= tailers (who presumably are not prohibited from making contributions. Com= petition and markets discipline behavior and establish competitive prices a= nd terms of service. Because regulators don't set the prices and terms of = service for such sellers there is no reason to be concerned about campaign= contribuitions from such organizations. Indeed the legislation and the = legislative history clearly conform to this underlying policy rationale. As a former practicing lawyer I certainly understand the value of pleading= in the alternative. But I question how certain of our arguments woud be = perceived by the public if they ever came to light (which these documents h= ave a habit of doing).. . I can just see the press seizing on Enron's clai= m of ignorance or mistake or the fact that we pled for the favorable exer= cise of prosecutorial discretion. I suggest that we add whatever we feel= is necessary to the very solid looking intent argument not make specific = reference to ignorance or mistake and not plead for the favorable esxerc= ise of PD. If we feel we need to write about this last item perhaps we co= uld suggest that it would be a waste of the public's resources to pursue a = claim under such circumstances. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: pipeline aftermath Body:: In case you had not heard Lou Pai has done some fundraising for Franks and both he and his(Lou's) sister know him fairly well. Keep it in mind if at some point we need to get in to see him. From: Jeffrey Keeler 08/23/2000 03:44 PM To: Clayton Seigle/HOU/ECT@ECT cc: Steven J Kean/NA/Enron@Enron Richard Shapiro/HOU/EES@EES Michael Terraso/OTS/Enron@ENRON David L Johnson/OTS/Enron@ENRON Shelley Corman/ET&S/Enron@ENRON Joe Hillings/Corp/Enron@ENRON Cynthia Sandherr/Corp/Enron@ENRON Allison Navin/Corp/Enron@ENRON Subject: Re: pipeline aftermath Clayton: Here are some preliminary answers to your questions (and I have copied GPG and Government Affairs folks as well to share this information): 1) I am currently assessing the situation regarding pipeline safety legislation. This week has been very quiet on Capitol Hill as all of the members are back in the states on August recess running for re-election and it is a big vacation week for staff...but here's what I am hearing: As you may or may not know we have been been very active this year trying to temper pipeline safety legislation that was fairly reactionary in the wake of last summer's liquid pipeline accident in Bellingham WA. SENATE: In June Senators John McCain (R-AZ) and Slade Gorton (R-WA) led the charge to pass a pipeline safety bill (S. 2438) out of the Senate Commerce Committee and that bill is awaiting floor action in the Senate. Because of the hasty way in which S. 2438 was drafted and passed there was a realization by both Republicans and Democrats in the Senate that the bill could not make it to the floor for a vote until some serious changes were made -- mostly things that were deal breakers for industry. Enron and El Paso were leading the charge and we had a number of Senators backing our efforts to negotiate changes including Majority Leader Trent Lott (R-MS) Kay Bailey Hutchison (R-TX) John Breaux (D-LA) and Sam Brownback (R-KS). From what I've learned since the accident these Senators are not changing their strategy and are still asking for the same improvements. Fortunately most of the changes we were looking to make were fairly technical and not the types of things that would be seriously compromised by the accident. Industy was already in the position of having to accept a number of things they never would have if not for he Bellingham incident...the El Paso incident just reinforces those. The biggest potential effect I see from the El Paso accident is an increased effort to pass something before the Congress adjourns in early October. The New Mexico Senators are already calling for a floor vote on the McCain/Gorton legislation and I there will certainly be greater pressure on leaders to wrap up negotiations get agreement from all sides on a bill and move it unanimously through a vote on the Senate floor. HOUSE: The House is moving a bit more slowly but again I'd expect the El Paso situation to expedite things somewhat. There were several bills introduced in the House that were not moving anywhere including an identical copy of the McCain legislation introduced by Rep. Bob Franks (R-NJ). Franks is now anxious to move legislation as he is running for Senate and would love to take credit for helping out on an issue of national visibility. Before the accident House Tranportation Committee leaders on both the Democrat and Republican side were working on a consensus bill that they could introduce in early September and move quickly through the Committee and to the House floor. I'm told that negotiations on that legislation are moving forward and a draft bill will be produced shortly. Unlike our experience in the Senate we have had significant input into the bill in advance and expect something that we can live with -- and something more reasonable than the McCain bill. With that said there may be an effort to expand the bill in a few areas because of the El Paso accident so we'll have to see what kind of hand we're dealt in the next few weeks. Overall I'd expect pipeline safety legislation to be given higher priority when Congress returns after Labor Day. In the absence of this accident I would have given it slim odds of passing in the few short weeks until adjournment with appropriations bills taking up most of Congress' precious time. Now there will be greater pressure to come to consensus and move bills through by an expedited process so that everyone running for election in November can show that they've done something about this terrible tragedy. With that said there's still not that much time to get legislation through so I'd say that there's still a chance it may not get done this year. If I had to attach a number to it I'd say that the El Paso accident improves the chances of legislation going all the way to probably 50-60%. 2) Gas supply to California: I'll have to do some more checking in this area and get back to you. All I've heard so far is that the safety questions that remain may slow the speed of restarting flow on the line notwithstanding that El Paso thinks it can have things running again fairly quickly. I'm sure the power crunch in California will put some counter-pressure on but I just don't have good intelligence on this yet. With all this said I'm on vacation this week and parts of next week finishing up some leave I've taken for the birth of our new baby daughter so I may not have an additional report for you until early to mid next week. If you have questions please respond by e-mail or leave a message on my voice mail at 202-466-9157. Regards Jeff Keeler From: Cynthia Sandherr 08/23/2000 09:48 AM Sent by: Allison Navin To: Clayton Seigle/HOU/ECT@ECT cc: Jeffrey Keeler/Corp/Enron@ENRON Cynthia Sandherr/Corp/Enron@ENRON Subject: Re: pipeline aftermath Jeff Keeler in our office handles pipeline safety issues and I am copying him on this e-mail so that he may reply to you directly. Also Cynthia is out of the office through the end of the week but will be reachable tomorrow and Friday. Thanks. Allison Clayton Seigle@ECT 08/22/2000 06:29 PM To: Cynthia Sandherr/Corp/Enron@ENRON cc: Subject: pipeline aftermath Hi Cynthia: The commercial officers here are very concerned with the El Paso pipeline explosion in New Mexico. We would love to get some input from your group on the following questions if possible: 1. What is the status of pipeline safety legislation on the Hill and what is the outlook for action between now and the end of the year? 2. What are people from California saying about the added pressure on gas supplies and what are people from New Mexico saying about restarting the flow of gas while safety questions remain? These questions come straight from the top and any information you could provide would be very helpful. Please write me back or call and let me know if/when you think we might be able to get some initial answers. Thanks very much! Clay What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I love you. Call me. What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ATTORNEY CLIENT PRIVILEGDE - Draft FERC Brief on Settlement Process Body:: see below. Federal price limits backfire=20 Some generators withhold power rather than abide by rate caps=20 David Lazarus Chronicle Staff Writer=20 Wednesday July 4 2001=20 ?2001 San Francisco Chronicle =20 URL: 01/07/04/MN186091.DTL =20 Officials in California and Nevada after months of lobbying for federal re= gulators to cap Western power prices warned yesterday that the newly impos= ed limits have had the unintended consequence of increasing a threat of bla= ckouts in the two states.=20 The warnings were issued as California came within minutes of rolling black= outs yesterday afternoon and one day after the first-ever rolling blackout= s in Las Vegas forced energy-hungry casinos to shut off fountains and reduc= e air conditioning.=20 The two states are asking the Federal Energy Regulatory Commission to take = a closer look at the so-called price mitigation plan and come up with revis= ions that would deter power companies from withholding electricity during s= hortages.=20 We need some clarity to this order said Oscar Hidalgo a spokesman for t= he California Department of Water Resources which is spending billions of = dollars to keep the state's lights on.=20 Generators need to be held accountable he said.=20 The crux of the problem is that price limits kick in during shortages yet = power companies say these caps force them to sell power at below-market rat= es during periods of high demand.=20 Some companies have responded by holding back power rather than face the ex= pense of shipping electricity from state to state. Each mile that electrici= ty must be transmitted adds to the overall cost.=20 No one's going to pay for transmission if the cost is near the caps said= Gary Ackerman executive director of the Western Power Trading Forum an e= nergy-industry association in Menlo Park.=20 Ackerman said several companies in his organization decided that there was = no economic advantage to offering power in regional markets when price cont= rols are in effect.=20 This means individual regions like California or Las Vegas could end up no= t having enough Ackerman said. It increases the threat of blackouts.=20 BLACKOUT ALERT CANCELED California authorities issued a blackout alert at 1:45 p.m. yesterday when = power reserves dipped to dangerously low levels. They canceled the alert ab= out an hour later after finding additional supplies.=20 Everyone in the West is fighting for megawatts said Stephanie McCorkle = a spokeswoman for the California Independent System Operator which oversee= s the state's power network.=20 The Golden State's latest brush with lights-out conditions came a day after= Nevada experienced its own rolling blackouts for the first time prompting= heavy power users such as the MGM Grand and Caesars Palace to dim their li= ghts.=20 Don Soderberg chairman of the Nevada Public Utilities Commission said tha= t the sudden power emergency took state authorities by surprise and that th= ey are investigating to see what role the federal price limits may have had= in exacerbating Monday's shortage.=20 We're looking very closely at this he said. There seems to be a potenti= al for unintended consequences.=20 Specifically Soderberg said Nevada is focusing on operators of older less= - efficient plants who would find profit margins shrinking if not vanishin= g under capped prices.=20 We're going to see how the caps might have played into this he said.=20 The federal ceiling in 10 Western states excluding California is about $9= 2 per megawatt hour. In California a 10 percent surcharge is added because= of the state's credit risk bringing the price to just over $101.=20 Ackerman at the Western Power Trading Forum said regional price controls ha= ve extended California's power crisis to neighboring states.=20 California sneezed and the rest of the region caught the virus he said.= =20 'LAWYERS LOOKING FOR LOOPHOLES'=20 California and Nevada officials however said that they still have faith t= hat price limits can stabilize Western electricity markets but that federal= regulators may have to tweak the system so that power companies cannot wit= hhold output.=20 The generators have banks of lawyers looking for loopholes (in the plan)= said Hidalgo at the Department of Water Resources.=20 Unfortunately it may take some time for the regulators to revisit an issue= that they took up only with the greatest reluctance. For months federal r= egulators refused to impose price controls preferring instead to let suppl= y and demand determine costs.=20 Hidalgo said that when it appeared that power companies were throttling bac= k on output Monday California officials immediately dialed the hot line nu= mber provided by the Federal Energy Regulatory Commission in case of emerge= ncies.=20 No one answered he said. They were closed.=20 State officials tried again yesterday and this time were told that the com= mission would look into the matter. They were not given a time frame for wh= en the commission might come up with a response.=20 E-mail David Lazarus at dlazarus@sfchronicle.com .=20 ?2001 San Francisco Chronicle Page A - 1=20 Out-of-state generators pull plug over uncertainty on price controls By Dale Kasler Bee Staff Writer (Published July 3 2001)=20 Confused by the federal government's new controls on electricity prices ge= nerators withheld so much power from California on Monday that the state wa= s nearly plunged into rolling blackouts state officials said.=20 The confusion began when the state's electric grid operators declared a Sta= ge 1 power alert in the early afternoon triggering the price caps for the = first time since they went into effect June 21.=20 Out-of-state generators pulled about 1500 megawatts of electricity off the= table at midafternoon enough to power about 1.1 million homes because of= uncertainty about how much they could charge under the new Federal Energy = Regulatory Commission pricing system said Oscar Hidalgo spokesperson for = the state Department of Water Resources. The department buys electricity fo= r the state's financially distressed utilities.=20 They didn't understand what they were going to be paid there was confusio= n over the FERC order Hidalgo said. We saw 1500 megawatts disappear.= =20 The problem was exacerbated by a heat wave across the West which forced Ca= lifornia to compete with other states for scarce electricity he said. Roll= ing blackouts hit southern Nevada.=20 Most California officials credit the FERC system which is based on a varia= ble price cap with reining in what had been a runaway wholesale power mark= et. But power generators have complained that the price caps by limiting p= rofits could discourage the production of critically needed electricity. A= nd as Monday's episode suggested even the uncertainty about where the cap = will fall could lead to unexpected shortages.=20 That's the risk that you run (with price controls) said Arthur O'Donnell= editor of the newsletter California Energy Markets. People want any kind= of certainty at all.=20 Hidalgo said the state avoided blackouts only because of last-minute import= s from the Bonne=07ville Power Administration the federal agency that mark= ets government-produced hydroelectric power in the Pacific Northwest. The s= tate went into a Stage 2 power alert the next-to-last level before blackou= ts are ordered. The alert was canceled in late afternoon.=20 The blackouts would have been the first in California since May 8.=20 FERC imposed a round-the-clock ceiling on power throughout the West. The pr= ice fluctuates and is tied to the production costs of the least-efficient p= lant operating in California during a power alert declared by the Indepen= dent System Operator which runs the state's power-transmission grid. When = there's no alert prices can't exceed 85 percent of the cap that was establ= ished during the latest alert.=20 Until Monday the maximum price held steady at about $101 a megawatt-hour i= n California. But when the ISO declared a Stage 1 power alert in early afte= rnoon signifying that reserve supplies had dwindled to less than 7 percent= of demand confusion set in Hidalgo and others said.=20 Because of a steep drop in the price of natural gas which fuels many Calif= ornia power plants suppliers knew the cap would fall. But no one knew by h= ow much until the price was posted by the ISO.=20 The ceiling for California fell to about $77 at 3 p.m. but was back up to $= 98 in two hours according to the ISO. Those prices include the 10 percent = premium that sellers can charge California because FERC said there's a cred= it risk in selling to the state.=20 O'Donnell said it's likely suppliers will pull back from the market every t= ime the ISO declares a power alert.=20 In-state generators have to operate their plants if summoned by the ISO. Bu= t out-of-state suppliers can withhold supplies and on Monday it was the ou= t-of-staters that were pulling back Hidalgo said.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m .=20 Power Sales Halted by New Pricing Curbs=20 Electricity: Confused suppliers unsure what they will be paid refuse to s= ell to state which asks FERC for a ruling but doesn't get it.=20 By NANCY VOGEL Times Staff Writer=20 SACRAMENTO--Confusion over new federal price restrictions prompted sev= eral electricity sellers to back away from sales to California on Monday af= ternoon pushing the state closer to blackouts energy officials said. The state lost sales that would have provided enough electricity to su= pply more than 1 million homes said Ray Hart deputy director of the Calif= ornia Department of Water Resources which has been buying much of the stat= e's electricity since January. At least five companies producing or marketing power are telling us t= hat since they don't know what they're going to get paid they're not going= to take the risk and so they're not going to sell the energy Hart said. The electricity sales fell through after power consumption soared in s= ummer heat and grid operators were forced to declare a Stage 1 emergency m= eaning reserves had dipped below 7%. It was the first such emergency since = May 31. Under a June 19 order by the Federal Energy Regulatory Commission inte= nded to bring down wholesale electricity markets across the West a power e= mergency in California triggers the setting of a new price limit that appli= es to power plant owners from Washington to Arizona.=20 The new price is supposed to be based upon whatever it costs to run th= e most inefficient expensive power plant selling electricity to California= grid operators during the first full hour of a Stage 1 emergency. But much uncertainty remains about exactly how and when the new price = is supposed to be established under the commission's order and that appare= ntly drove away sellers Hart said. Shortly after the state issued the Stage 1 alert at 1:30 p.m. putting= the old price limit of $90 per megawatt-hour in question companies that h= ad committed to provide the state electricity hour by hour Monday afternoon= backed out Hart said. The companies include TransAlta Energy Marketing of= Oregon Constellation Power of Baltimore and Sempra Energy Trading a unit= of the San Diego-based energy conglomerate. Forced to dip even deeper into the state's power reserves and declare = a Stage 2 emergency water agency officials called the federal energy commi= ssion's hotline for clarification about what the new price should be and wh= en it should take effect. They got no answer. Hart said commission officials reached at home promised to try to clar= ify their order today. One outstanding question is what obligations power s= uppliers have to deliver electricity to California in an emergency. Both buyers and sellers in the market agree that the new price when i= t is set will probably be lower than $90 per megawatt-hour because the pri= ce of natural gas the main fuel in California power plants has dropped la= tely. Temperatures soared several degrees higher Monday than grid operators = had anticipated. But they said they expected to avoid rolling blackouts in = part because the Bonneville Power Administration in Portland Ore. had agr= eed to provide several hundred megawatts of Pacific Northwest hydropower ea= ch hour in exchange for a return of electricity from California later this = summer. Bonneville is giving us emergency power to get us through Hart said= .=20 Copyright 2001 Los Angeles Times=20 James D Steffes 07/06/2001 10:04 PM To:=09Jeffrey T Hodge/Enron@EnronXGate Robert C Williams/Enron@EnronXGate cc:=09Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda R= obertson/NA/Enron@ENRON Alan Comnes/Enron@EnronXGate Jeff Dasovich/NA/Enr= on@Enron Susan J Mara/NA/Enron Robert Frank/NA/Enron@Enron Ray Alvarez/N= A/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON dwatkiss@bracepatt.com=20 Subject:=09ATTORNEY CLIENT PRIVILEGDE - Draft FERC Brief on Settlement Proc= ess The attached is a rough draft of a potential filing Enron would make in to = Judge Wagner in the Settlement process (it is unclear if this would remain = confidential per the gag order). Please provide Ray Alvarez your comments. This would be filed as early as = Monday am. Jim =20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Granite Update Body:: What are our chances of final approval at FERC at the JUly meeting. Jeff still thinks this is a third quarter close. Do we have any chance of making that happen? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Neptune -- merchant transmission Body:: Ed I am sure I shall screw up sooner or later (given my aging brain and amount of work). This guy will have to change his name to Ed Krapels to stay employed. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FREETRIAL - Enron Corporation News Alert: KEANSTEVEN_J_ENRON_COPORATIONS 9 new stories. Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Daily Update / Legislative Update - 8/23/00 Body:: It's hard to formulate a position without more of the specifics but I think our message should generally be: We support providing immediate rate relief to small residential customers. We believe that relief is best provided by giving San Diego the ability to procure power on a fixed price basis from the market. San Diego has offers in front of it now those should be evaluated and the legislature and the commission should give San Diego the flexibility to accept one or more of them. This is sounder than running huge deferrals (deficits) to be later recovered from consumers. Rate relief should be accompanied by real reform. Rate caps have bad long term consequences: they cause shortages. Combining short-medium term rate relief with expedited siting of new facilities will address the near term problem while laying the proper groundwork for a long term solution. Bruno Gaillard@EES 08/24/2000 11:08 AM To: Edward Hamb/HOU/EES@EES Jennifer Rudolph/HOU/EES@EES Chris Hendrix/HOU/EES@EES Greg Cordell/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Martin Wenzel/SFO/HOU/EES@EES Douglas Condon/SFO/EES@EES James M Wood/HOU/EES@EES Gary Mirich/HOU/EES@EES Dennis Benevides/HOU/EES@EES Roger Yang/SFO/EES@EES David Parquet@ECT mday@gmssr.com SF Directors Paul Kaufman/PDX/ECT@ECT Marcie Milner/Corp/Enron@ENRON Mary Hain@Enron Harry Kingerski/HOU/EES@EES James D Steffes/HOU/EES@EES Richard Shapiro/HOU/EES@EES Peggy Mahoney/HOU/EES@EES Karen Denne@Enron Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Christopher F Calger/PDX/ECT@ECT cc: Subject: Daily Update / Legislative Update - 8/23/00 This email reflects today's events in Sacramento. The information provided is subject to change because of constant flux. However it is important for us to provide this information for feedback and to caution as to new regulations that may affect some deals in the making . Governor Davis Assembly Women Susan Davis and Senator Alpert had a press conference. They will introduce a rate/bill stabilization plan for SDG&E and an expediting siting bill. There is no language as of yet. Although there is no specific language the following elements may be included: The stabilization plan will be applicable to residential and probably commercial customers in SDG&E The bill cap may be set at $68 for residential. The cap will be in place until the end of 2002 There will be language on expediting siting for generation plants Sam Wehn and Sandra McCubbin have been talking with the CEC executive director and several legislators about the siting portion of the bill. Any comments as to the bill cap proposal? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Revised Enron Comments on NERC Bill Body:: Attached is revised draft of Enron comments on the NERC bill. The helpful editorial revisions came from Charles and Sarah. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: From Michael L. Kirby, Esq. Body:: Bonnie: Please forward to Michael Kirby. I think the draft looks good. Could you also prepare a draft of the letter we discussed yesterday to convey the proposal to the committee? Bonnie Hugyez on 07/17/2001 12:34:20 AM To: cc: Subject: From Michael L. Kirby Esq. Attached is a draft Nonwaiver Agreement per our telephone conferences of yesterday after the meetings with Senator Dunn. I am available in my office for a conference call to discuss this. The information contained in this e-mail message and any accompanying documents is subject to the attorney-client privilege and/or the attorney work product rule and is confidential business information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient or representative of the recipient you are hereby notified that any dissemination of this communication is strictly prohibited. If you have received this communication in error please notify Kathryn A. Pugh at kpugh@pkns.com and immediately delete this message from your system. - 289271_1.WPD What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: request to CERA Body:: Your understanding was correct. In light of recent changes in the California regulatory environment (eg the recent rate order) I don't think it makes sense for us to distribute the document at this time so you can ignore the request. Thanks Peter Augustini 03/29/2001 06:18 PM To: 'skean@enron.com' cc: David Gibbons Subject: request to CERA Steve: Thanks for your note sorry I missed you. From your message I think there may be some miscommunication between your PR guys and us. We understood that your PR people wanted to reprint the Op-ed and redistribute it to as-yet-undetermined people along with various Enron material. They also wanted to post it on Enron's public web site. But your message seemed to indicate you just want to post the op-ed on your intranet - for educational use only for your internal folks. If this is correct we would have no problem with it. In fact we have posted the op-ed on the CERA web page - which is theoretically available to every Enron employee for internal use only. If you want you could just post a link to the CERA web site so your people could get direct access to all our research on the topic. If I misunderstood you and you do want to redistribute the piece to third-parties -- that is a much bigger issue because it involves our intellectual property and branding issues. Obviously we would need to talk some more about this. I hope this helps. On a somewhat-related note we are also getting sucked more and more into the California vortex and being asked to help in areas that are not our traditional business such as expert witness testimony and policy issues. While we are not afraid to take a point of view (as you know!) we must maintain a neutral and independent posture. This is sometimes a difficult path to navigate but we are exploring two areas that may also interest Enron: 1. We have examined Joskow and FERC's analysis on the price gouging issue and we believe there are several major flaws in their methodologies. We are considering how best to broadcast our assessment without impinging on our core business or becoming an expert witness. We think a workshop similar to the Monday event at CERAWeek could work where we would present our findings and issue a report. 2. We are also looking into the economic impact of power outages in the West - especially linked to the overall fragile state of the US economy. This would be a collaborative effort with a major economic forecasting firm or university. Again the reults would go to our clients but could be released to a wider audience and a workshop might help highlight the release. Please let us know if either topic would be of interest to Enron. We would need to raise funding from various clients to help underwrite the effort but the work would be CERA's independent research and we would stand fully behind it. Hope all is well. ...Peter . What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Public Policy Contacts for California Body:: Jeff and Steve ? As you requested I have prepared a list of my preferred public policy contacts?for California.? It is composed of professionals from an array of public private and non-profit backgrounds.? I have worked in some capacity with?each of these people?and most I know quite well.? ? Please call me for further background. ? Kevin 213-926-2626 ? Attachment - Kevin Scott - Preferred Contacts - 6-20-01.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Protecting Confidential Information: New European Restricted List Procedure Body:: As you probably all know we are on the verge of launching credit derivatives trading in Europe and North America both on Enron Online and off-line. This will involve quoting prices for buying and selling bankruptcy protection in respect of reference entities many of whom are our counterparties in a variety of different commercial and financial contexts. This exciting cocktail of credit derivatives and Enron Online raises significant novel legal risks for Enron. Probably the most significant risk arises where Enron has confidential information about a reference entity and wrongfully uses that information in pricing the credit derivative on that entity. This could well result in legal proceeding against Enron. In practice an allegation of misuse of confidential information can be very difficult indeed to defend without adequate procedures in place to safeguard that information. Against this background is the ever-present risk of insider dealing. This crime - which carries a maximum prison sentence of 7 years and an unlimited fine - is committed where a person (or member of their family etc) deals in the securities (shares or bonds) of a listed company on the basis of unpublished (confidential) price-sensitive information. In addition SFA rules require the safeguarding of confidential information the misuse of which is a serious disciplinary matter. In order to ensure the success of this new business we are now introducing new policies and procedures (attached) which include a simple Restricted List procedure. In essence they require you - to take prudent steps to safeguard confidential information within Enron to notify Michael Brown Mark Elliott or myself if you become aware of confidential information (or circumstances) about a counterparty which you think might make it appropriate for that counterparty to be placed on the Restricted List. To make life easier numerous examples of the types of information which might be relevant are set out in the attached procedures so please familiarise yourself and anyone else in your group you think appropriate with them. As you will see you are not expected to make difficult determinations about whether an entity should or should not be added to the Restricted List just to let us know if you think there is a possibility that it should be added. We will also provide quick briefing sessions to ensure that each of you is comfortable with these new procedures. Many thanks for your co-operation. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Performance Review-Washington Office Support Staff-Germain Palmer Body:: Fine Richard Shapiro 07/21/2000 10:43 AM To: Gwendolyn Petteway/HR/Corp/Enron@ENRON cc: Steven J Kean/HOU/EES@EES Subject: Performance Review-Washington Office Support Staff-Germain Palmer Can we change- I'm not opposed ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: California Power Issues Database Body:: Add Mona Petrochko peggy mahoney and Rob Bradley Gavin Dillingham@ENRON_DEVELOPMENT 08/25/2000 04:55 PM To: joe Hartsoe@ENRON Sandra McCubbin@EES Susan Mara@EES Paul Kaufman@ECT Karen Denne@ENRON Jeff Dasovich@EES Mark Palmer@ENRON James D Steffes@EES Richard Shapiro@EES Elizabeth Linnell@EES Jeannie Mandelker@ECT Steven J Kean/NA/Enron@Enron Mark A Schroeder@ENRON Peter Styles@ECT cc: Subject: California Power Issues Database We have developed an intranet site/database for information tracking purposes for the California Power Issue. The intranet site will be placed on the home.enron.com webpage by Tuesday morning for all Enron employees to access. However today this comprehensive database is available to you for your California Power Issue needs. The database has been populated with the latest information that I have received concerning this topic and has been broken down in three categories: California Power Issues National Power Issues and Secured Documents. It has then been broken down further into subcategories. The secured documents sections will only be accessible to those that are receiving this e-mail. Please let me know if you believe others should have access to this information. The secured document section contains all the information that I have received that Luntz Consulting has helped us develop i.e. principals statements speeches and facts as well as talking points and other statements developed internally. These documents can be easily switched to open access to all Enron employees if you believe that these documents should not be restricted. To access the intranet site you must be logged on to the network and then go to this link: (It is best if you copy this link and paste it in your internet Explorer or Netscape browser.) Once you are at this site you will be able to access all articles and information that I have collected/received concerning the California Power Issue. You can navigate the site by using the links on the left hand side of the screen. While navigating this site keep in mind that the actual interface will be changed before we go live on Tuesday morning. To access the secured documents click on secured documents and type in your user name which is the same as if you are logging onto the network and then type in your password which is the same as if you are logging onto the network. However if you have difficulties entering this site you will need to change your Lotus internet password. Which is very simple to do and which you will need to do regardless if you decide to use this site or not it is all part of the current computer migration. To change your internet password go to this link and then hit the edit person key. Go to the last field that says internet password and type in whatever password you would like preferably your current network login password. (In the internet password section you will see a bunch of numbers and letters delete those and enter your new network password.) There are still some bugs that will be worked out by Tuesday but I thought since this is such a fast moving issue it was best to get this tool out so it could be used when needed. If you have any questions please call me at 713-853-4382. Thanks Gavin What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meet with Skilling in his office. Project Body:: Balboa and PGE filing - Cancelled for the time being - per Vanessa Bob - They'll call us when he gets back What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: SMethodist Presentation Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: So you will know . . . Body:: Thanks I hope we get there soon. Mary Clark 09/26/2000 01:55 PM To: Steven J Kean/NA/Enron@Enron cc: Karen Denne/Corp/Enron@ENRON Mark Palmer/Corp/Enron@ENRON Subject: So you will know . . . Steve I'm leading a team with Beth Tilney that will roll out communications to employees worldwide after our stock price closes at $100. We will keep you posted on our plans as they materialize. Mary What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Information for Jeff Skilling from Kevin Scott Body:: Confirming 1:00 p.m. meeting on June 12 at the Venetian Resort in Las Vegas. Thanks Joannie Williamson 713-345-7774 Kevin Scott on 04/25/2001 04:46:18 PM Please respond to To: Jeff Skilling cc: Sherri Sera Subject: Information for Jeff Skilling from Kevin Scott April 25 2001 Dear Jeff Thank you for setting aside time to meet with me. I have attached my resume to help bring you up to date on my career. As you will see I have been providing advisory services since 1995. During these years I have done some of my best work. I am proud of the service that I have rendered as an independent consultant. Now I feel it is time to move to a new chapter in my career. I look forward to sitting down with you to think through ways to apply my experience intellect and energies to new professional challenges. I respect you tremendously and wherever the next part of my career may lie I know that my search and choice will benefit significantly from your perspective. Finally I am attaching the recommendation to HBS that you wrote in 1981. I found it during a profoundly challenging period in my life. Your historic words of support helped me keep fighting and successfully moving forward. If you would like to reach me before our meeting please call (213) 926-2626 or email kevinscott@onlinemailbox.net . Thank you again. Sincerely [IMAGE] Kevin Attachments (2) - image001.png - image002.gif - Resume of Kevin Scott.doc - Skilling HBS Recommendation.doc What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FERCs marketing affiliate conference Body:: I heard you were a big hit. Leslie Lawner 03/20/2001 08:45 AM To: James D Steffes/NA/Enron@Enron Shelley Corman/Enron@EnronXGate Rebecca W Cantrell/HOU/ECT@ECT cc: Richard Shapiro/NA/Enron@Enron Harry Kingerski/NA/Enron@Enron Steven J Kean/NA/Enron@Enron Subject: FERC's marketing affiliate conference Becky and I attended FERC's gas marketing affiliate conference last week. Non-affiliated competitors continue to build straw men and describe abuses with no real evidence to back them up (the funny money argument and capacity hoarding are two examples. The funny money argument assumes marketing affiliates will bid above market rates for capacity because they excess payment is going to the corporate bottom line. Hoarding capacity to drive up price may be an issue but it is not a marketing affiliate issue as anyone can do it). FERC staff did not seem terribly sympathetic to the points made but at least one FERC staffer seemed to believe that one solution would be to require the pipelines to offer capacity in smaller blocks to let smaller entities put together bids. FERC also indicated they were in fact auditing compliance but in a non-public way. There were some concerns voiced which I agree with and there is an opportunity to file additional comments on Apr. 30. I would like to put the following in these comments: Evidence of affiliate abuse/preference is just not there. The best folks can do is make up stuff. We welcome FERC monitoring if that is needed to bring confidence to the marketplace that abuse is not occurring. But the issue is really whether we do have a crisis of confidence or merely a bunch of disgruntled competitors who are just seeking to neutralize the affiliated competitors). The FERC rules and the information reported (with a caveat) under those rules are adequate for detection and enforcement and deterrence. That said the definition of marketing affiliate should be expanded to include affiliated electric generators who are siting plants along affiliate pipelines. The pipeline 637 reporting and internet systems should allow users to download and manipulate transportation related data which is not currently the case. We also need to address a deal on Northern where ENA took capacity at a discount albeit after other parties had an opportunity to match our bid. This was a deal brought up in the conference. Let me know how this sounds. Thanks. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: White House Talking Points and Abraham Mtg with EPSA Body:: Linda - as we discussed adding a sentence on open access is key. Also I would delete the sentence about the transmission system not being designed for the way it's being used today. Richard Shapiro 04/02/2001 04:23 AM To: Linda Robertson/NA/Enron cc: Steven J Kean/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON Joe Hartsoe/Corp/Enron Subject: Re: White House Talking Points and Abraham Mtg with EPSA It would be nice to get a one sentence mention made of open access just to show they care....I say this in part because of Scott Miller's e-mail pleading for more focus on this issue. Thanks. Linda Robertson 03/30/2001 12:31 PM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON cc: Subject: White House Talking Points and Abraham Mtg with EPSA 1. I am faxing to you a bootleg copy of the draft talking points Ed received this morning at the White House energy messaging meeting. These are very close hold. Ed asked that we not circulate these to anyone. Ed asked us to give him feedback of any concerns we have with the talking points (he will be giving them comments). After glancing at the TPs the obvious missing point is open access. However I am not sure we should be alarmed about that. There really isn't any policy in the TPs. This is a typical WH message document. Let me know if you think it is imperative to insert open access. Also Ed would like to position us as the coalition leader of the White House outreach effort. Any thoughts? 2. I am faxing to you EPSA's summary of the generators meeting with Secretary Abraham. I am glad I did not attend this meeting. As you will see from the summary there were three parts to the meeting: a) an exchange of policy views both long and short term b) discussion of how to maximize generator output in Calif and c) a request that industry participate in a DOE reliability group. I don't see any follow up for Enron outside of our normal course of activities and independent interchange with DOE officials. Let me know if you have additional thoughts. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Translation - Nikkan Kogyo 5/21 (Enron Mentioned) Body:: I think we need to keep the pressure on. I liked the way our basic message= =20 was evolving over the course of last week. As you pointed out the Japanes= e=20 utilities view us as just another annoying US company who is going to come= =20 in bang its head against the wall for a few months and then leave. We nee= d=20 to continue to reinforce the message that not only are we not going away w= e=20 are starting other businesses here to keep us going while we continue to=20 agitate for reform in the electricity sector. Nicholas O'Day 05/21/2001 04:37 AM To: Mark Palmer/Corp/Enron@ENRON Jackie Gentle/LON/ECT@ECT Vance=20 Meyer/NA/Enron@ENRON cc: Steven J Kean/NA/Enron@Enron John Sherriff/LON/ECT@ECT Mika=20 Watanabe/AP/Enron@Enron=20 Subject: Translation - Nikkan Kogyo 5/21 (Enron Mentioned) To date reports on Enron's role in California have been limited to a repri= nt=20 of a Sacramento Bee article appearing in the Denki Shimbun - a limited=20 circulation publication sponsored by the Japanese utilities. Last Friday Mr= =20 Ohta President of Chubu Electric and Chairman of the Federation of Electri= c=20 Power Companies made some uninformed comments at a regular energy press cl= ub=20 briefing about Enron's commitment to its Californian customers . Ohta will = be=20 retiring from both positions in two weeks.=20 In the past both Chubu Electric and the Federation of Electric Power=20 Companies have distanced themselves from Mr Ohta's public comments which ar= e=20 generally considered to be ultra conservative and unsupported by facts. As = a=20 result we have tended to ignore his comments. However on this occasion I= =20 think we need to set the record straight on Enron's role in California. I= =20 would welcome your thoughts on whether we should let the comments pass or= =20 respond. Over the past few months we have received various statements from Houston= =20 (for both internal and external consumption) explaining Enron's role in=20 California. Most recently (May 10) we received from Peggy Mahoney (via Vanc= e)=20 an EES statement dated 1 February entitled Media Statement about EES=20 Resourcing California Customers. It would be helpful if there is a=20 comprehensive statement that has recently been put together that we could= =20 distribute here. If not we can put something together here tomorrow and=20 email it across to you for approval with the aim of getting something out= =20 Wednesday. As an aside we had a record 3766 visitors to the EJ website last Friday= =20 the day the Brattle paper appeared on the website. kind regards =20 ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Job well done Body:: nan What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Congratulations on your appointment by Fox. That's great news. I continue to be impressed by the way Fox is handling things. Let me know what I can do to help. As you know we are looking for a replacement for the unreplaceable Ricardo Charvel. I know you and he have discussed some possibilities. Rick Shapiro has met several candidates and will be bringing two to Houston in the next week or so. Dr. Kean continues to improve her golf game while I slave away at Enron to cover the greens fees. Let me know when you are coming to town next. What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Restructuring Today quotes Jeff at length on retail vs wholesale price caps. He does talk about protecting small customers with retail caps and highlights the more destructive nature of wholesale caps. If you need a copy let me know. kmagruder@newpower.com on 09/09/2000 11:39:55 AM To: Steven.J.Kean@enron.com cc: rshapiro@enron.com glockhart@newpower.com mmanly@newpower.com Subject: Re: Thanks Steve. The message we received was that Jeff had said he'd take retail price caps to avoid wholesale price caps. I know the press and listeners will distort things so I take the reports with a grain of salt. We just hope that you and Dasovich will find a way if asked to stress the right way to take care of small customers - enhance competition and create a robust retail market. I know we all want the same result. We just hope that with our roadshow beginning next week Gene doesn't have to explain away any other perceived Enron slams on retail competition. P. S. I can't think of two better spokesmen for the cause of competition than you and Dasovich. Steven J Kean@ENRON 09/08/2000 06:03 PM Sent by: Steven J Kean@ENRON To: kmagrude@enron.com cc: Richard Shapiro/HOU/EES@EES Subject: Got your message. I'm testifying at the Congressional hearing and Dasovich is covering FERC. I think Jeff's comments were taken out of context. He said policymakers do need to take care of small customers whose bills are tripling. Frankly we'd get slaughtered if we said anything else. But he also said there is a right way and a wrong way to do it. Enron and others had provided a market based answer by offering a fixed price deal to SDG&E (which would have enabled them to cap rates to those who had not switched. California elected instead to cap rates and deficit spend (ie create a deferral account). I don't think we can stand for anything that doesn't protect the small customers but we can continue to emphasize the market based solutions. One of the messages in my testimony will be: customers should be encouraged to choose. Those who did are doing fine. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Andy Zipper Body:: Andy Zipper What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Meeting with Debra- Rice Professor Body:: Anne I shall brief you on the meeting. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meet with Ralph Reed in EB49c5 Body:: With Rick Mark Lou and possibly Hillings What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Dates for Emerson Meeting Body:: I think I can recommend that the time be set aside but it would be helpful if we pointed out to Emerson that it must be clear that there is a clear opportunity for Enron before we schedule the meeting. Maybe you could use this to get some progress on a bundled outsource deal. Nate Ellis@EES 02/28/2001 03:05 PM To: Marty Sunde/HOU/EES@EES Jeremy Blachman/HOU/EES@EES Michael Mann/HOU/EES@EES Troy Henry/HOU/EES@EES cc: Martin Wenzel/SFO/HOU/EES@EES Micah Hatten/HOU/EES@EES Joannie Williamson/Corp/Enron@ENRON Sherri Sera/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Subject: RE: Dates for Emerson Meeting Gentlemen: Situation: Emerson is aggressively seeking at least a three hour time slot for a meeting with Jeff Skilling in April or May 2001. Mr. Skilling's office is hesitant to allocate more than two hours without your recommendation. Emerson is being persistent. The key players from Emerson are David Farr newly appointed CEO and James Berges President and effectively the leader of Emerson's strategic development effort. It is anticipated that both would attend the meeting. Emerson execs want to (i) get to know Mr. Skilling and other senior management (ii) discuss mutual business opportunities and (iii) hold a discussion about the transformation of Enron from a pipeline company to its current form. The last point has to do with Emerson's continuing self-transformation effort and how Enron achieved its transformation. I need your advice and recommendation. Please respond by e-mail or telephone (x5-4040). Background: Emerson initiated this latest round of contact with Enron in November 2000 when Mike Train and Mark Proudfoot both Emerson VPs of Corporate Development visited the Enron building hosted by Steve Kean. I met them at that time. Since that initial meeting Emerson has aggressively pursued a business joint venture as preferred supplier with Martin Wenzel and the distributed power business I believe with promising results. My sense is that Emerson is uniquely positioned as EES' partner in that business. I am waiting to receive an update from Martin. Emerson is also interested in becoming a preferred supplier for EES's DSM business. While we generally support that idea we are pressing Emerson to reciprocate by becoming a customer of our bundled outsource business. Emerson is highly decentralized and our efforts to date have been unsuccessful. I want to use the meeting as an opportunity to press Emerson to consider a proposal from EES's bundled outsource business. Please let me know your recommendation on this matter. Thanks Nate ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Meeting w/Sempra Body:: sounds good. I think we should not talk about the conversations with the governor . . . I'd rather not prompt them to go to the gov (presumably to object to the gov talking to us without talking to them at the same time). Jeff Dasovich Sent by: Jeff Dasovich 10/11/2000 02:54 PM To: Richard Shapiro/NA/Enron@Enron skean@enron.com Sandra McCubbin/SFO/EES@EES Paul Kaufman/PDX/ECT@ECT James D Steffes/NA/Enron@Enron Harry Kingerski/NA/Enron@Enron Susan J Mara/SFO/EES@EES Mona L Petrochko/SFO/EES@EES mpalmer@enron.com Karen Denne/Corp/Enron@ENRON cc: Subject: Meeting w/Sempra FYI. Recently Chris Calger has asked me to set up a meeting with Sempra. ENA's seeking deals with the two big CA gas IOUs (PG&E and SoCalGas) that would give ENA access to their assets. In short ENA wants to offer a complete outsource deal for the IOUs' core gas load (i.e. rez and small commercial customers). ENA would take responsibility for providing service for delivery at the city gate and in return would manage all of core's assets (upstream of the city gate). We're meeting with Sempra's Chief Regulatory Office (Bill Reed) and Sempra's CFO next Thursday to discuss. Given the fact that Sempra's primarily focused on electricity the plan is to lead off the meeting with a couple of electricity solutions as a bridge to the gas offer. For electricity the plan has two pieces: 1) a commodity offer that beats the 6.5 cent cap (i.e. nothing fancy) and 2) Deal Bench services with the intent of establishing a procurement mechanism for SDG&E that the California PUC could pre-approve (thereby eliminating some of the immense regulatory risk SDG&E now faces). Wanted to run this by folks to gauge reactions. We'll distribute the slides we're putting together as soon as they're drafted--hopefully by COB Friday. Best Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Electricity Issues Body:: Thanks. We are preparing a memo (John has seen it) to go out to each of our offices telling them about this incident (and the related ones that occurred the same day) and including some tips on how to handle such confrontations in the future. John_Presley@enron.net on 05/23/2001 02:14:25 PM To: SKean@enron.com Mark.Palmer@enron.com cc: John_Brindle@enron.net David_Cromley@enron.net Subject: Electricity Issues Steve/Mark I have looked into the demonstration by the ACORN group which occurred on 5/21 at our New York Office (780 3rd Ave). I believe you are well aware of the incident as the office there immediately contacted Mark Palmers group. I will respond to the building management to discuss security issues and to gain a better understanding of the security posture of the facility. If you have any questions or require further follow-up please let me know. - John P. John Presley Business Controls Enron Corp (EB4646) Ext. 58208 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EES QBR - in 30c1 Body:: Lunch will be served at 11:30 QBR starts at 12:00. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Im Leaving Enron Body:: Congratulations on your new position! This all came up rather suddenly at least as far as I can tell. If you have any interest I would like to talk to you sometime. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: followup to telephone conversation of 3-7-01 Body:: Excerpts by email are fine. Also as I mentioned I am very impressed with your background and accomplishments but I would like to have you meet a couple of other people in my group before making a final offer. Thanks and stay warm! Kim Amy 03/09/2001 08:44 AM To: 'skean@enron.com' cc: Subject: followup to telephone conversation of 3-7-01 Dear Mr. Kean: Thank you for your call. I am looking forward to working for you. I will be available as of June 1 2001. I will have the writing samples and resume ready for you on Monday March 1 2001. Should I fax it to you? Also my dissertation is quite lengthy. Would you like for me to forward you one chapter or just a couple pages? As discussed I will be available to come down to Houston between March 30 and April 6 2001. More snow (as in 6 inches) is expected today and tomorrow. I'm only 5'6. Pretty soon I will be buried in it since it's snow upon snow. HELP!! I look forward to seeing you again. Regards Amy What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: GREAT NEWS ****FERC Order on Morgan Stanley Complaint Against ISO Body:: See below. This would have presented a bigger problem than price caps. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Ken Lay spoke with several California CEOs this morning and urged them to get personally involved in pushing for a comprehensive set of reforms. Three expressed willingness to help. Scott McNealy (Sun): contact person - Piper Cole (piper.cole@sun.com) scott.mcnealy@engeng.sun.com. Mcnealy wants by close of business today a cheat sheet of the talking points to use with politicians (the 8 or 10 elements of the solution) with the expected comeback he may hear from the political leaders and our response to that comeback. He says he hasn't spent time working on issues in Sacremento so we may also want to include a list of suggested contacts. Kevin Sharer (Amgen): contact person - Sarah Jensen VP of Engineering and Operations (805.447.6785) ksharer@amgen.com. Sharer wants the same information as McNealy and he and McNealy both indicated their willingness to call a meeting of other California CEOs. Sharer will also be having breakfast with Hertzberg one week from today. Robert Day (Trust Co of the West): said that he is very close to the mayor of Los Angeles. He urged Ken to call the mayor (mentioning Day). Ken would like some talking points for that call. Jeff - please put these items together. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: DRAFT Comments on Barton RTO Draft Body:: Attached for review and comment is a draft set of talking points on the Barton RTO discussion draft. I went through the testimony at the recent hearing and parsed the legislative language of the discussion draft. You will see that the talking points are designed to respond to two basic points being raised by our opponents: (1) that FERC is rushing and being heavy-handed and (2) that the only interests involved are those of the transmitting utilities (i.e. no mention of discrimination as being what RTOs will remedy). Please let me have your thoughts in the next few days. Once Capitol Hill is up and running again we will distribute the final talking points to our consultants and to members/staff of the Barton Subcommittee as we continue our efforts against the discussion draft's treatment of RTOs. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Frank Thanks. I have given your name to the employee Energy and Power Risk Management magazine who organizes Power2001 Conference in Houston (May of 2001). Vince Frank A. Wolak on 11/28/2000 09:04:42 AM To: Vince.J.Kaminski@enron.com cc: Subject: Vince Sorry about the delay in responding. It's the end of the quarter and I'm teaching 3 courses so things are very busy plus I had to work on a response to the FERC Proposed Order for California. Here is my student's CV. Please let me know if you need more information. Frank Wolak - jmyan_cv_new1.pdf What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Telephone Interview with The Enron Corp. Research Group Body:: Marshall: Thanks for responding so quickly. I have scheduled the following intervie= w: Wednesday December 6 - 1:00 PM Houston time. It will last approximately 1 hour. We will call you at (605) 497-4045 unless otherwise instructed. If you have any questions please feel free to contact me at 713/853-5290. Best regards Shirley Crenshaw Jingming 'Marshall' Yan on 11/28/2000 12:59:55 PM To: Shirley.Crenshaw@enron.com cc: Vince.J.Kaminski@enron.com=20 Subject: Re: Telephone Interview with The Enron Corp. Research Group Ms. Crenshaw Thank you very much for the message. I am very interested in the opportunity to talk to personnel from the Research Group at Enron. Between the two days you suggest I prefer Wednesday 12/6. Considering the two-hour time difference between California and Texas 11:00 am Pacific time (1:00 pm your time) seems to be a good slot. However I am open most of the day on 12/6 so if some other time slot is prefered on your end please let me know. Thanks again. I look forward to talking to you and your colleagues. Jingming On Tue 28 Nov 2000 Shirley.Crenshaw@enron.com wrote: > Good afternoon Jingming: > > Professor Wolak forwarded your resume to the Research Group and > they would like to conduct a telephone interview with you sometime next > week at your convenience. The best days would be Tuesday 12/5 or > Wednesday 12/6. > > Please let me know which day and what time would be best for you and > they will call you. Let me know the telephone number that you wish to be > contacted at. > > The interviewers would be: > > Vince Kaminski Managing Director and Head of Research > Vasant Shanbhogue Vice President Research > Lance Cunningham Manager Research > Alex Huang Manager Research > > Look forward to hearing from you. > > Best regards > > Shirley Crenshaw > Administrative Coordinator > Enron Research Group. > 713-853-5290 > > > Jingming Marshall Yan jmyan@leland.stanford.edu Department of Economics (650)497-4045 (H) Stanford University (650)725-8914 (O) Stanford CA 94305 358C Economics Bldg If one seeks to act virtuously and attain it then what is there to repine about? -- Confucius _?OO??OOo? ?T=15xO-?? -- =14?? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Request Submitted: Access Request for maureen.raymond@enron.com Body:: I cannot access the system to approve the request. I get a message that the page is not available on-line. Vince Kaminski What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL BUSINESS PROPOSAL Body:: And another..... What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Body:: Frank Thanks for your message. What about a meeting on Tuesday September the 4th. We could meet at your office let's say at 4 p.m. We would be delighted if you could join us for dinner later in the evening on the same day. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Test Body:: testing What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: eBiz article on Bush energy plan Body:: Looks good to me. I'm glad you had the chance to work with Linda. Jeannie Mandelker@ECT 05/23/2001 03:31 PM To: Karen Denne/Corp/Enron@ENRON Linda Robertson/NA/Enron@ENRON Steven J Kean/NA/Enron@Enron cc: Subject: eBiz article on Bush energy plan Linda thanks for making time for me today. This is the eBiz article we'd like to run Friday. I need your comments by noon tomorrow. You can e-mail them back or reach me at 3-6305. Thanks Jeannie What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Stella Chan /Project Summer transfers Body:: How are we handling these now? Last time I talked to Jeff we weren't going to lift the restrictions until next week (assuming we do lift the restrictions). Any word? ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - Robert L Bradley Jr Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: AP Wires Thurs 3/22: Report: Power wholesalers overcharged California $5.= 5=20 billion Dow Jones Newswires Thurs 3/22: Reliant To Appeal Fed Judge Ruling To Sel= l=20 Pwr To Calif Sac Bee Thurs 3/22: Federal judge orders major power wholesaler to sell t= o=20 California San Jose Mercury News Thurs 3/22: State falling short on pacts that provi= de=20 low-cost energy Contra Costa Times Thurs 3/22: Crisis saps state surplus Sac Bee. Fri 3/23: Bill to pay small energy firms stalls Sac Bee Fri. 3/23: House panel ends energy hearings -- will it step in? Sac Bee Fri 3/23: Dan Walters: Crisis deepens: politicos panic San Diego Union Fri. 3/23: Report says power wholesalers overcharged=20 state $6 billion San Diego Union Fri 3/23: Disappearing state surplus sparks alarm San Diego Union Fri. 3/23: Outages darken economic outlook in state so= me=20 say San Diego Union Fri. 3/23: Out-of-state generators question power=20 regulators' authority San Diego Union Fri. 3/23: Allegheny Energy makes big California=20 connection LA Times Fri 3/23: Judge Frees Small Firm From Edison Contract SF Chron Fri 3/23: Lodi Defies Order for Blackouts=20 Utility tells PG&E to 'pay the bills' SF Chron Fri 3/23: Coming Down to the Wire=20 State legislators battle over alternative energy bills SF Chron Fri 3/23: Grid Operators Push to Prevent Overcharging=20 They say regulators must be aggressive to stop billing abuses=20 Mercury News Fri. 3/23: State's bill for energy could double this year Mercury News Fri. 3/23: Plan for alternate power plants stalls --- --- Report: Power wholesalers overcharged California $5.5 billion=20 DON THOMPSON Associated Press Writer Thursday March 22 2001=20 2001 Associated Press=20 (03-22) 11:41 PST SACRAMENTO Calif. (AP) -- Electricity wholesalers have= =20 overcharged California more than $5 billion since May by manipulating the= =20 energy market according to a report prepared for power grid managers.=20 The Independent System Operator will file the findings with federal=20 regulators and ask for a refund ISO spokesman Patrick Dorinson said.=20 The state auditor also said Thursday that the state's 1996 deregulation law= =20 encouraged both buyers and sellers of electricity to ``manipulate wholesale= =20 prices to their advantage'' by underestimating supply and demand.=20 The auditor's report lays out what it calls ``a complex combination'' of=20 deficiencies and misjudgments it says led to the state's power problems.=20 According to the ISO report five in-state power suppliers and 16 importers= =20 frequently offered electricity at prices higher than it cost them to produc= e=20 -- effectively withholding supplies -- or didn't bid at all when they were= =20 able to generate power.=20 ISO Director of Market Analysis Anjali Sheffrin presented the findings at a= =20 conference in Berkeley last week.=20 The companies have denied overcharging California and have said they expect= =20 the Federal Energy Regulatory Commission will determine their prices were= =20 justified.=20 The commission has recently stepped up scrutiny of power companies' behavio= r=20 during California's power crisis asking suppliers to justify $124 million = in=20 sales during the first two months of the year or refund the money. Critics= =20 claim thousands of additional questionable sales are not being challenged.= =20 California has been spending about $45 million a day -- $4.2 billion since= =20 January -- to purchase power for Pacific Gas and Electric Co. and Southern= =20 California Edison. Both utilities the state's largest have been cut off b= y=20 electricity wholesalers because their credit is almost worthless.=20 Edison and PG&E say they are nearly $14 billion in debt due to soaring=20 wholesale power costs. The state's deregulation law blocks them from=20 recovering the costs from customers.=20 State Controller Kathleen Connell said Wednesday that the state's=20 power-buying is gutting its budget surplus.=20 Since the state started making emergency power buys the surplus has fallen= =20 from $8.5 billion to about $3.2 billion she said.=20 Connell ordered an audit of the power buys saying Gov. Gray Davis is=20 withholding key financial information from her office and the Legislature.= =20 She said she would refuse to transfer $5.6 billion into a ``rainy day fund'= '=20 she said was set up to impress Wall Street as the state prepares to issue $= 10=20 billion in revenue bonds to cover its power buys.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routin= e=20 and required by law.=20 ``The law says she has to do it. The law does not give her the power to=20 demand that kind of audit information'' Harrison said.=20 Davis spokesman Steve Maviglio said the administration has released the=20 financial information it can without jeopardizing negotiations for long-ter= m=20 power contracts with wholesalers.=20 Also Wednesday a federal judge ordered a major wholesaler Reliant Energy= =20 Services to continue selling power to California despite its fear that it= =20 will not be paid.=20 The ISO buys power from companies like Reliant on behalf of utilities in=20 attempts to fend off rolling blackouts like those that hit the state this= =20 week and during two days in January.=20 --- Reliant To Appeal Fed Judge Ruling To Sell Pwr To Calif 03/22/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LOS ANGELES -(Dow Jones)- Reliant Energy Inc. (REI) said Thursday it will= =20 immediately file with the 9th Circuit Court of Appeals in San Francisco in= =20 response to a federal judge's ruling late Wednesday that the company contin= ue=20 selling power to California regardless of whether it is paid.=20 U.S. District Court Judge Frank Damrell granted California's Independent=20 System Operator which makes last minute power purchases in the spot market= =20 a preliminary injunction against Reliant saying Californians were at risk = of=20 irreparable harm if Reliant stopped selling power to the state. The ISO manager of the state's electricity grid said the judge's ruling= =20 will allow the agency to keep the lights on in California.=20 Reliant which is owed more than $300 million from the state's cash-strappe= d=20 utilities supplies California with about 3000 megawatts of electricity fr= om=20 power plants it owns in the state.=20 Reliant spokesman Richard Wheatley said the state Department of Water=20 Resources the agency that buys California's bulk power needs on behalf of= =20 PG&E Corp. (PCG) unit Pacific Gas & Electric Edison International (EIX) un= it=20 Southern California Edison and Sempra Energy (SRE) unit San Diego Gas &=20 Electric should back the ISO's last minute power purchases.=20 In a filing with the Securities and Commission Reliant said it is owed $10= 8=20 million by the DWR for last minute power purchases the ISO made during the= =20 six weeks prior to the agreement Reliant made with the DWR.=20 Damrell dismissed Reliant's claim saying he does not have the authority to= =20 force the DWR to pay for that power.=20 We're going to immediately appeal Judge Damrell's order Wheatley said.= =20 Clearly the judge understands the implications of his order. We are requir= ed=20 to do business with creditworthy entities. Unfortuantely the judge did not= =20 force the ISO to post a surety bond which would allowed us to do business= =20 with the ISO.=20 Gov. Gray Davis has said the state is not responsible for the last minute= =20 power purchases the ISO makes despite a law passed authorizing the DWR to= =20 buy power on behalf of the utilities.=20 Wheatley added that the company will also seek relief on the issue at the= =20 Federal Energy Regulatory Commission. Damrell's ruling remains in effect=20 until the Federal Energy Regulatory Commission rules on the matter.=20 Separately Wheatley said a short-term power supply contract that Reliant= =20 signed with the DWR expired Monday and the DWR has not renewed the contract= .=20 A spokesman for the DWR would not comment on the issue.=20 -By Jason Leopold Dow Jones Newswires 323-658-3874=20 jason.leopold@dowjones.com --- --- ----------------------- Federal judge orders major power wholesaler to sell to California Updated: March 21 2001 - 8:23 p.m.=20 A federal judge issued a preliminary injunction Wednesday ordering a major= =20 electricity wholesaler to continue selling to California despite its fear= =20 that it will not get paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant Energy Services stopped selling power to the=20 Independent System Operator which oversees the state's power grid. The ISO= =20 buys last-minute power on behalf of utilities to fill gaps in supply to try= =20 to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The state has been spending about $50 million a day on power for Pacific Ga= s=20 and Electric Co. and Southern California Edison both denied credit by=20 suppliers after amassing billions of dollars in debts. The judge said he had no authority to force the DWR to pay for that power.= =20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 Damrell denied the ISO's request for preliminary injunctions against three= =20 other wholesalers Dynegy AES and Williams who agreed to continue selling= =20 to the ISO pending the FERC ruling.=20 Spokesmen for Reliant Dynegy AES and Williams were out of the office=20 Wednesday night and didn't immediately return calls from The Associated Pre= ss=20 seeking comment on the ruling.=20 The ISO went to court in February after a federal emergency order requiring= =20 the power sales expired. The judge then issued a temporary restraining orde= r=20 requiring the sales but dropped it after the suppliers agreed to continue= =20 sales to California pending his Wednesday ruling.=20 The ISO said it would lose about 3600 megawatts if the suppliers pulled ou= t=20 enough power for about 2.7 million households. One megawatt is enough for= =20 roughly 750 homes.=20 Grid officials said Reliant's share alone is about 3000 megawatts. Reliant= =20 said the amount at issue actually is less than a fourth of that because mo= st=20 of the power is committed under long-term contracts.=20 Reliant which provides about 9 percent of the state's power worries it=20 won't get paid due to the financial troubles of PG&E and Edison.=20 PG&E and Edison say that together they have lost about $13 billion since Ju= ne=20 due to soaring wholesale electricity costs that California's 1996=20 deregulation law bars them from passing onto customers.=20 At the same time the state has faced a tight electricity supply due in pa= rt=20 to California power plant shutdowns for maintenance and to a tight=20 hydroelectric supply in the Pacific Northwest.=20 Managers of the state power grid imposed rolling blackouts across the state= =20 Monday and Tuesday as supply fell short of demand. Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts. State Controller Kathleen Connell said Wednesday that the energy crunch als= o=20 imperils California's financial health. Connell said the state's power-buying on behalf of Edison and PG&E is is=20 gutting its budget surplus. Since the state started making emergency power= =20 buys in January the surplus has fallen from $8.5 billion to about $3.2=20 billion she said.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is refusing a request by Davis and the Legislature to transfer $5.6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its=20 power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism. Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 Also Wednesday a report by Davis' chief power negotiator appears to show= =20 that as much as 75 percent of the state's power purchases will have to be o= n=20 the expensive short-term market this summer said Sen. Debra Bowen D-Marin= a=20 del Rey chairwoman of the Senate Energy Committee.=20 The prices may be phenomenol she said particularly given predicted=20 hydroelectric shortages due to drought in the Pacific Northwest.=20 The report by David Freeman who is negotiating the state's long-term power= =20 contracts shows California has finalized 19 contracts and has 25 agreement= s=20 in principle. Freeman said DWR is continuing to negotiate other contracts. Bowen said FERC should impose short-term price caps or let generators to=20 charge enough to make a reasonable profit or we could be subject to enormo= us=20 price-gouging this summer.=20 -- Associated Press --- State falling short on pacts that provide low-cost energy=20 Published Thursday March 22 2001 in the San Jose Mercury News=20 BY CHRIS O'BRIEN AND JOHN WOOLFOLK=20 Mercury News=20 The state has signed low-cost contracts for just a third of the energy it= =20 needs this year raising the prospect that California could be forced to bu= y=20 much of its electricity this summer on the expensive spot market.=20 A spokesman for Gov. Gray Davis conceded Wednesday that the state will be i= n=20 trouble without more contracts but insisted California will meet its needs= =20 through conservation and additional long-term deals for cheap electricity.= =20 The state according to a report released Wednesday has fallen far short o= f=20 the governor's goal of filling almost all its electricity needs through suc= h=20 deals. In fact the state has lined up contracts for about half the amount= =20 Davis had projected earlier this month.=20 If the state has to rely heavily on the volatile spot market where the pri= ce=20 of electricity this summer could reach five times the state's contract pric= e=20 pressure could mount to raise the cap on the electricity rates consumers pa= y.=20 But Steven Maviglio the governor's spokesman said ``The governor has sai= d=20 he's committed to work this in the existing rate structure so that's the= =20 plan.''=20 In the report sent to state lawmakers the state Department of Water=20 Resources indicated that it had secured just more than 20 million=20 megawatt-hours for this year leaving it far short of the 60 million=20 megawatt-hours needed.=20 ``This is just a progress report'' Maviglio said. ``They did all this in= =20 three weeks which is pretty amazing when you think about it and we have a= =20 lot more to do.''=20 The state got into the power buying business in January supplying it to th= e=20 state's nearly bankrupt utilities.=20 The state negotiated long-term contracts with generators to supply that pow= er=20 at a reduced rate. Based on the report the state will pay an average of $6= 8=20 per megawatt-hour over the next 10 years -- significantly less than in=20 December when prices spiked higher than $300 per megawatt-hour but not as l= ow=20 as the $55 Davis hoped to reach.=20 Most of this power however won't be delivered until 2004. From 2004 to=20 2006 the Department of Water Resources estimates it has enough power unde= r=20 contract. Until then the amount falls short.=20 In 2001 it appears the state has about one-third of the power it needs. Th= e=20 gap closes to about half in 2002 and two-thirds in 2003.=20 At a news conference in Los Angeles two weeks ago Davis said the state wou= ld=20 have to buy only 30 to 45 percent of the power it needs this summer on the= =20 open market.=20 At the time critics said with only two-thirds of the power under contract= a=20 rate increase was almost inevitable. Even Davis' chief negotiator S. David= =20 Freeman offered a bleak assessment for the summer saying that all availab= le=20 electricity has already been sold.=20 ``We'll be subject to extremely high prices'' said Frank Wolak a Stanford= =20 professor who sits on a market committee for the Independent System Operato= r=20 the agency that runs the state power grid.=20 Wolak said there are two main hopes for avoiding a price increase this=20 summer: Federal officials could cap the wholesale price a step they've=20 resisted or Californians can conserve an unprecedented amount of power. --- --- ----------------------- Crisis saps state surplus POWER CRISIS=20 Controller moves to block a transfer of funds saying the $8.5 billion=20 surplus has been cut more than half since January=20 By Mike Taugher TIMES STAFF WRITER=20 The energy crisis has bled California's once-touted budget surplus by more= =20 than half since taxpayers began buying electricity two months ago leading = a=20 top state finance official Wednesday to order an audit of the power purchas= es=20 and block Gov. Gray Davis' plan to transfer funds into a reserve account.= =20 A booming economy last year produced a budget surplus that totaled $8.5=20 billion in January. But that figure now stands at about $3.2 billion=20 according to Controller Kathleen Connell.=20 We started this year with a generous budget surplus Connell said in a=20 statement announcing her decision to block what Davis administration=20 officials described as a routine transfer of surplus money. The energy=20 crisis has taken much of that away and this transfer on top of the=20 electricity purchases would put the fund at risk.=20 Meanwhile the Davis administration released a report by David Freeman the= =20 governor's chief negotiator on power purchases on the progress of executin= g=20 long-term agreements meant to stabilize the power buys.=20 According to the report only about 40 percent of the electricity needed fr= om=20 the open market this year has been lined up. That means the state could be= =20 forced to continue buying a substantial amount of power on the highly=20 expensive spot market and further drain its coffers.=20 And a key regulatory panel is scheduled next week to issue a ruling that=20 would determine how quickly state funds will be replenished when it decides= =20 what portion of electric bill payments should be allocated to the state=20 treasury a decision that could include a rate increase to fully repay=20 taxpayers without further crippling the state's two largest electric=20 utilities.=20 The Public Utilities Commission also will consider whether it will force th= e=20 utilities to pay alternative energy producers whose shutdowns this week=20 contributed to blackouts.=20 Connell's action underscores a growing nervousness over the sheer volume of= =20 money that is being poured into energy buys despite the fact that state=20 officials plan to replenish the treasury with up to $10 billion in loans th= at=20 will be repaid by electricity consumers.=20 The state has committed to spending $4.2 billion to date to keep lights on= =20 since taxpayers were forced in mid-January to take over electricity buys fr= om=20 the financially crippled utilities Pacific Gas & Electric Co. and Southern= =20 California Edison. Tax money is going out at a clip of about $50 million a= =20 day.=20 High prices already have brought PG&E and Edison to the brink of bankruptcy= =20 and now the state's surplus is at risk according to Connell.=20 In addition to requesting an audit and announcing her intention to delay th= e=20 transfer to the reserve account Connell said she wanted the administration= =20 to send her office more information about the electricity purchases.=20 Davis' representatives questioned Connell's authority in trying to block th= e=20 funds transfer which they called a routine accounting procedure and accus= ed=20 her of making political hay.=20 It is not helpful to the taxpayers or ratepayers or the people who just wa= nt=20 to keep the lights on it isn't helpful to have the situation muddied like= =20 this said Sandy Harrison a Finance Department spokesperson. We're sorry= =20 it came up in this manner.=20 Connell and the administration have butted heads in recent weeks. The=20 controller wants to post details of the state's electricity purchases on he= r=20 Web site a plan that have been delayed under pressure from Davis because o= f=20 the governor's concerns that releasing those details will allow power=20 generators and traders to sell at higher prices.=20 Harrison said administration officials believe Connell lacks the authority= =20 either to block the funds transfer to a reserve account or to audit the sta= te=20 water resources department.=20 Two days of widespread blackouts this week show how vulnerable the power gr= id=20 is to financial glitches. Although several factors combined to produce the= =20 blackouts state power officials say the outages could have been avoided if= =20 the utilities were paying their bills to alternative energy producers.=20 Many of those producers including clean-burning natural gas power plants= =20 wind solar and geothermal energy developers shut down enough production t= o=20 spell the difference between grid reliability and blackouts Monday and=20 Tuesday.=20 Davis called the utilities' failure to pay bills to those producers known = as=20 qualifying facilities immoral. The QFs were either unable to buy gas fro= m=20 their suppliers or were frustrated with the utilities' failure to pay them.= =20 The utilities hoarded billions of dollars since November without paying an= y=20 money out said Davis spokesman Steve Maviglio. They've got the money --= =20 we're pulling the trigger to make them pay it.=20 The utilities however say they are doing all they can to conserve enough= =20 cash to continue operating. Together they owe the QFs about $1.5 billion.= =20 Next week the PUC is scheduled to consider whether to force the utilities = to=20 heed Davis' demand to pay the QFs and it might also decide how much of=20 ratepayers' bill payments will be used to refund taxpayers for power buys.= =20 PG&E says that under a formula proposed by the administration the water=20 resources department would receive about 40 percent of the money collected= =20 from ratepayers for power purchases.=20 The rest of that money about $240 million would have to be divided among= =20 QFs existing power contracts operating PG&E's nuclear and hydroelectric= =20 plants and what hour-by-hour purchases the utility still must make on the= =20 spot market according to PG&E spokesman John Nelson.=20 There isn't enough to do that he said.=20 That is making it increasingly likely that electric bills will be hiked=20 according to a growing chorus of officials and experts.=20 Unless rates are raised Nelson said the only entity that can absorb a lac= k=20 of payment or a partial payment is the state treasury. Cutting off any othe= rs=20 will lead to electricity becoming unavailable and more blackouts he said.= =20 If they do it under existing rates -- given that the existing pool of mone= y=20 is not enough -- who doesn't get paid or who gets a partial payment? Nelso= n=20 said. What's the only entity left with wiggle room? The state.=20 Rate hikes are also a sticking point in negotiations to bail out the=20 utilities through purchase of their transmission lines and other assets=20 Maviglio said.=20 They want rate increases of significant magnitude and we're not going=20 there he said.=20 WE CAN TRIM STORY HERE IF NECESSARY BUT KEEP TAGLINES AT BOTTOM=20 About one-third the electricity needed by the customers of California's thr= ee=20 major utility companies is produced by the companies themselves one-third= =20 comes from alternative producers who use environmentally friendly technique= s=20 and one-third is bought on the open market.=20 The state stepped in to buy the one-third needed from the open market after= =20 the utility companies ran out of cash and credit in January to make the=20 purchases themselves.=20 But that electricity has proven to be enormously expensive and Davis has= =20 planned to lower those prices by committing to long-term purchases.=20 Freeman's report on the progress of those long-term purchases dated March = 15=20 but released this week said the state has finalized 19 contracts with seve= n=20 suppliers and reached 25 additional agreements.=20 Mike Taugher covers the environment and energy. Reach him at 925-943-8324 o= r=20 mtaugher@cctimes.com.=20 Staff writer Andrew LaMar contributed to this story. --- --- ----------------------- Bill to pay small energy firms stalls By Kevin Yamamura Dale Kasler and Jim Sanders Bee Staff Writers (Published March 23 2001)=20 A quickly melded proposal that would assure payments for alternative energy= =20 suppliers whose money woes contributed to power blackouts this week stalled= =20 Thursday in a divided Legislature.=20 The state Senate passed the bill AB 8x but with Republicans balking it w= as=20 rejected in the Assembly along party lines. Assembly leaders said they may= =20 try again today.=20 For most of Thursday lawmakers scrutinized legislation they had overhauled= =20 the night before to include Gov. Gray Davis' plan to force utilities to pay= =20 solar wind and small gas-fired suppliers. Such providers called qualifie= d=20 facilities or QFs provide more than 20 percent of California's=20 electricity and their shutdowns were partly to blame for rolling blackouts= =20 Monday and Tuesday.=20 Under the Democratic governor's plan the state Public Utilities Commission= =20 would determine prices at which alternative generators may sell power but= =20 legislation is needed to authorize the PUC action.=20 Lawmakers faced time pressures Thursday. They wanted to pass the bill quick= ly=20 so the PUC could act next week and legislators could embark Monday on an=20 annual three-day lobbying trip in Washington D.C.=20 Assembly Speaker Robert Hertzberg D-Sherman Oaks said the Republicans'=20 rejection of AB 8x could jeopardize more than $4 billion the state has spen= t=20 or allocated for electricity during the energy crisis.=20 Hertzberg said producers of alternative energy which are owed more than $1= =20 billion have threatened to drag debt-ridden utilities into involuntary=20 bankruptcy if the Legislature failed to pass the measure.=20 They said it and I believe it Hertzberg said. If such bankruptcies occu= r=20 he added the state with its multibillion-dollar debt would become just=20 another creditor in a pile of creditors.=20 But Assembly Republican leader Bill Campbell of Villa Park said the=20 finger-pointing is unfair. Passage of AB 8x would not necessarily prevent= =20 bankruptcies he said.=20 One alternative energy provider won a crucial court ruling Thursday that=20 staved off at least for a while threats by some creditors to haul one or= =20 both big utilities into bankruptcy court for nonpayment of bills.=20 CalEnergy Co. Inc. won the right to sell its geothermal power which was=20 contracted to Southern California Edison on the open market. CalEnergy sai= d=20 it is owed $45 million by Edison.=20 If the Imperial County judge hadn't ruled in CalEnergy's favor the company= =20 and seven other QFs were fully prepared to file an involuntary bankruptcy= =20 petition against Edison this morning said David Sokol chief executive of= =20 CalEnergy's parent MidAmerican Energy Holdings Co. of Des Moines Iowa.=20 That is currently off the table.=20 An involuntary bankruptcy proceeding would take California's energy crisis= =20 into uncharted territory although a bankruptcy judge would have the leeway= =20 to reject the filing.=20 Freed from its contract with Edison CalEnergy will move to sell its=20 electricity to people who will pay for it Sokol said.=20 Besides calming the bankruptcy movement temporarily the ruling also could= =20 prompt other alternative energy providers -- hundreds of which have shut do= wn=20 because of nonpayment by Edison and Pacific Gas and Electric Co. -- to foll= ow=20 CalEnergy's example and find other buyers for their electricity said Gary= =20 Ackerman of the Western Power Trading Forum an association of generators.= =20 Assembly Republicans said they felt the Senate's decision to package three= =20 important energy issues into a single bill was an attempt to ramrod=20 legislation through both houses.=20 We have to stand and say no Campbell said during floor debate.=20 Besides determining alternative generator payments the bill would change a= n=20 earlier law by capping the value of bonds the state may sell for power=20 purchases at $10 billion. It also would extend to large businesses an=20 existing rate cap in the San Diego Gas and Electric Co. service area.=20 And it would earmark a portion of rates paid by utility customers to fund t= he=20 state's ongoing power purchases. Within a week the state will have spent= =20 $4.2 billion on power since January.=20 Without the bill some legislators fear Pacific Gas and Electric and=20 Southern California Edison would be reimbursed before the state.=20 They have got (some) gall to go to the PUC and say they're going to go to= =20 court to keep our money -- to keep our money to pay off their creditors= =20 said Senate President Pro Tem John Burton D-San Francisco.=20 Most of the bill's controversy however centered on how the PUC would trea= t=20 gas-fired alternative generators.=20 The commission issued a revised draft decision Wednesday that would impose= =20 prices for qualifying facilities at $79 a megawatt-hour for five-year=20 contracts or $69 a megawatt-hour for 10 years.=20 But those producers that use natural gas -- representing about two-thirds o= f=20 the alternative energy providers in California -- spent Thursday arguing th= at=20 Davis' plan to rescue them would all but guarantee that they would go out o= f=20 business instead.=20 The plan -- ordering Edison and PG&E to pay them a fixed price for their=20 power -- would set rates well below the cost of natural gas they said.=20 Democratic lawmakers tried to assure such producers that the PUC would set= =20 prices that make business sense even obtaining a letter to that effect fro= m=20 Loretta Lynch who heads the commission.=20 Davis has vowed to fine Edison and PG&E if they don't pay alternative=20 producers for future deliveries. But Sokol said his company isn't convinced= =20 that Edison will pay.=20 Calling Edison a confrontive in-your-face nasty organization Sokol sai= d=20 the utility was sitting on $2 billion and not paying its bills. Edison i= n=20 a Securities and Exchange Commission filing Thursday said its debts outwei= gh=20 its cash reserves by $722 million.=20 The Senate sent the Assembly two other bills that deal specifically with=20 supply and demand. The first SB 5x would spend about $1 billion on energy= =20 conservation and low-income assistance programs. The other SB 28x would= =20 streamline siting procedures for power plant construction.=20 In separate energy-related matters Thursday the Assembly approved:=20 AB 21x which would allow businesses industries or other electrical=20 customers to negotiate private contracts with energy providers.=20 Nine energy bills designed to generate or save 665 megawatts of electricity= =20 -- including 345 megawatts this summer. One megawatt is enough electricity = to=20 light about 1000 homes.=20 The state put power emergencies behind it after dropping out of a Stage 1= =20 alert late Wednesday. The California Independent System Operator which=20 manages the state's power transmission grid was predicting no further aler= ts=20 this week. It expected cooling temperatures and a regular dropoff in=20 electricity use on Fridays to lessen demand at the same time that more pow= er=20 plants were returning to service.=20 Bee staff writer Carrie Peyton contributed to this report.=20 --- House panel ends energy hearings -- will it step in? By David Whitney Bee Washington Bureau (Published March 23 2001)=20 WASHINGTON -- A key House panel wrapped up a series of hearings on the=20 California electricity crisis Thursday and now will decide whether to come = to=20 the state's aid with legislation.=20 But the panel's Texas chairman made clear that West Coast price controls=20 won't be on the table.=20 Caps will not be in anything I am submitting said Rep. Joe Barton=20 chairman of the House Energy and Commerce Committee's energy and air qualit= y=20 subcommittee.=20 Some form of federal controls to hold down escalating wholesale prices this= =20 summer because of power shortages has been the most frequent appeal of=20 witnesses who testified before the panel during roughly 30 hours of hearing= s=20 over five days.=20 Such controls have been sought by the governors of California Oregon and= =20 Washington. As power shortages are forecast for other regions states like= =20 New York also have appealed for temporary price controls to halt gouging.= =20 But the Federal Energy Regulatory Commission which is responsible for=20 enforcing reasonable wholesale rates under the Federal Power Act has refus= ed=20 to impose them and the Bush administration is bolstering that decision by= =20 opposing any legislation that would compel such action.=20 Barton in a brief hallway interview declined to say what other legislativ= e=20 remedies he might propose to address the worsening California situation.=20 He said he expects to submit a list of ideas to the White House today and= =20 after receiving comment on it sit down with other committee Republicans an= d=20 Democrats next week to see if any legislation is in order.=20 If we are going to do anything to help California or the West this summer= =20 we have to make it law within the next month or six weeks Barton said.=20 Even the panel's senior Democrat Virginia Rep. Rick Boucher was urging a= =20 careful and deliberate approach to the California crisis which he said w= as=20 largely of the state's own making.=20 There are steps Congress might take to provide some help to the West such = as=20 more money for conservation and relaxed federal regulation of air quality= =20 standards. That would permit older more polluting generators to operate=20 through a long hot summer when electricity demand could exceed supply by= =20 about 3000 megawatts roughly the amount needed to power 3 million homes.= =20 But Alan Lloyd chairman of the California Air Resources Board said power= =20 production already is being maximized without sacrificing air quality.=20 Simply put no essential electricity generation has been curtailed due to= =20 air emission limitations he said. California's programs to protect publi= c=20 health are not major factors in the electricity shortages experienced to=20 date.=20 The concern is that as shortages turn into more rolling blackouts wholesal= e=20 prices will jump even higher and steadily bleed the economies of California= =20 and the West Coast.=20 William L. Massey the lone member of the energy regulatory commission who= =20 supports price controls said at a Tuesday hearing that without them the We= st=20 Coast faces economic catastrophe this summer.=20 It was evident from the comments of some Republicans that they think their= =20 party could capitalize politically from a difficult summer.=20 If they had a bad summer it could show up in the polls said Rep. Charli= e=20 Norwood R-Ga. And sometimes that's not a bad idea.=20 One of the most dramatic exchanges during the weeklong hearings came Thursd= ay=20 with S. David Freeman the former general manager of the Sacramento Municip= al=20 Utility District who now heads the Los Angeles Department of Water and Powe= r.=20 He recently was named Gov. Gray Davis' chief negotiator with power generato= rs=20 for long-term contracts to stabilize future deliveries.=20 Don't feel sorry for California Freeman said. We're going to come out o= f=20 this stronger than ever.=20 But Freeman said it will be a year or two before all the fixes are in place= =20 and in the meantime the region desperately needs Congress' help to force th= e=20 FERC into controlling wholesale prices which witnesses said are likely to= =20 rise from $7 billion last year to as much as $70 billion or more this year.= =20 We recognize that the current administration and various legislators have= =20 their own opinion as to the California situation Freeman said. But my=20 personal plea is that if the federal government is not going to help us th= e=20 least it should do is refrain from legislation that attempts to tell us wha= t=20 to do.=20 Barton perked up at that idea.=20 Leave California alone huh? Barton said. That might be a good motto.= =20 --- --------------------- Dan Walters: Crisis deepens: politicos panic (Published March 23 2001)=20 That choking sound you hear is California's political class shifting into= =20 near-panic mode as it realizes that the energy crisis is on the verge of=20 becoming a full-scale meltdown with utilities forced into bankruptcy and= =20 consumers hammered by severe and prolonged power blackouts and soaring=20 electricity bills.=20 The Legislature which had been content to allow Gov. Gray Davis to handle= =20 the crisis on his own suddenly came to life Thursday jolted by this week'= s=20 unexpected rolling blackouts and threats by creditors to force the utilitie= s=20 into bankruptcy court. Lawmakers quickly fashioned a basketful of legislati= on=20 aimed -- or so they hope -- at increasing power supplies promoting=20 conservation and relieving the financial pressure on utilities and=20 electricity generators. But it may be too little too late -- and Davis and= =20 other politicians are already pointing fingers of blame aware that a=20 political price will be paid if the apocalypse strikes.=20 While Davis chants his mantra that he inherited a fatally flawed utility=20 deregulation scheme from predecessor Pete Wilson Republicans are blaming= =20 Davis for moving too slowly after the crisis first surfaced last summer an= d=20 even some of Davis' fellow Democrats are distancing themselves from the=20 governor.=20 Deregulation was a product of a Republican governor a Republican author a= nd=20 a Republican PUC (Public Utilities Commission) that was unduly impatient= =20 Davis said at one point this week as the Capitol buzzed with private=20 negotiations and public posturing.=20 A day later however state Controller Kathleen Connell a Democrat issued= a=20 warning that Davis' power purchases running at $50 million a day had=20 already drawn down state budget reserves by nearly two-thirds and she=20 refused to authorize additional transfers. It was a direct shot by Connell = at=20 Davis an old rival and came just a day after the governor had endorsed a= =20 Connell foe Antonio Villaraigosa in the duel for mayor of Los Angeles.=20 Other Democrats didn't join Connell's direct challenge to Davis but there= =20 is nevertheless a growing concern among Democratic legislators that the= =20 power purchases are costing many billions of dollars more than the governor= =20 had projected and could place the state budget in jeopardy. They're nervous= =20 because Davis has refused to reveal even to legislators exactly how much= =20 power the state is buying each day and how much it is paying.=20 From the few details that have been disclosed it's clear that the state is= =20 spending about $1.5 billion a month which would wipe out the state's=20 reserves by midsummer. It's also becoming increasingly clear that Davis=20 probably can't make good on his promise to avoid major consumer rate=20 increases unless the state is willing to plunge deeply and semi-permanentl= y=20 into debt to underwrite wholesale costs or unless federal authorities orde= r=20 huge refunds from power suppliers.=20 Rates in areas served by private utilities have risen only slightly while t= he=20 costs first to utilities and later to the state soared. Data from the=20 administration and utilities when collated indicate that the state is in= =20 line to collect just 20 cents for every dollar it's spending on power=20 purchases and the gap will increase as summer heat drives up demand.=20 Privately some economists say that private utility rates will have to rise= =20 33 percent to 50 percent to cover costs of current power supplies plus=20 utilities' past debts to generators and the state's purchase of the=20 utilities' transmission system if that deal is made final.=20 It's ultimately going to break down and the ratepayer is going to pay for= =20 it one way or the other Republican Sen. Jim Battin said during one of=20 Thursday's many committee hearings on utility legislation. No one disagreed= =20 with him.=20 DAN WALTERS' column appears daily except Saturday. Mail: P.O. Box 15779= =20 Sacramento CA 95852 phone (916) 321-1195 fax: (781) 846-8350 E-mail: dwalters@sacbee.com Recent columns: --- Report says power wholesalers overcharged state $6 billion=20 By Don Thompson ASSOCIATED PRESS=20 March 22 2001=20 SACRAMENTO =01) Electricity wholesalers have overcharged California more th= an=20 $6.2 billion by manipulating the energy market according to a report by an= =20 economist working for power grid managers.=20 The Independent System Operator planned to file the findings with federal= =20 regulators Thursday and ask for a refund said ISO spokesman Patrick=20 Dorinson.=20 In a related development the state auditor said Thursday that the state's= =20 1996 deregulation law encouraged both buyers and sellers of electricity to= =20 manipulate wholesale prices to their advantage by underestimating both=20 supply and demand.=20 Disappearing state surplus sparks alarm=20 Outages darken economic outlook in state some say=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 The auditor's report lays out what it calls a complex combination of=20 deficiencies and misjudgments it says led to the state's power problems.=20 The ISO's filing came a day after the state controller complained that a=20 relentless energy crisis is jeopardizing California's financial future.=20 Since May the companies manipulated the market by bidding at excessive=20 prices effectively withholding supplies or by not bidding at all when they= =20 had generation capability available according to the ISO study.=20 ISO Director of Market Analysis Anjali Sheffrin presented the findings at a= n=20 energy conference at the University of California Berkeley last week.=20 The companies have denied overcharging California and have said they expect= =20 the Federal Energy Regulatory Commission will determine their prices were= =20 justified.=20 In a burst of activity after weeks of delay both houses of the Legislature= =20 approved bills Thursday designed to ease the energy crisis.=20 The state Senate approved measures to encourage energy conservation and spe= ed=20 up power plant construction.=20 Topping that the Assembly sent the Senate 14 energy-related bills includi= ng=20 $455 million in loans and grants to encourage energy efficiency and=20 conservation and alternative energy projects by this summer.=20 One of the Assembly bills would require new energy plants approved by the= =20 state to sell their power within California before they offer it to other= =20 states.=20 The (California) Energy Commission says for every day we delay this bill= =20 there are 20 megawatts that could be saved that we're not saving said sta= te=20 Sen. Byron Sher D-Stanford as senators voted 28-10 to send his conservati= on=20 measure to the Assembly.=20 Senators also approved another Sher bill speeding up the siting of power=20 plants. It went to the Assembly on a 37-1 vote.=20 Meanwhile a federal judge issued a preliminary injunction Wednesday orderi= ng=20 one of the companies named in the ISO filing Reliant Energy Services to= =20 continue selling to California despite its fear that it will not be paid.= =20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant stopped selling power to the ISO which buys at= =20 the last minute on behalf of utilities to bolster supplies and try to fend= =20 off blackouts.=20 Such blackouts struck the state twice this week shutting off power to=20 hundreds of thousands of people from San Diego to Oregon snarling traffic= =20 and shutting down businesses.=20 The state remained free of any power alerts Thursday morning as power=20 reserves stayed above 7 percent.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= =20 Southern California Edison and Pacific Gas and Electric Co.=20 The judge said he had no authority to force the DWR to pay for that power.= =20 The utilities have been denied credit after amassing billions of dollars in= =20 debt paying high prices for power that the state's energy deregulation law= =20 prevents them from passing on to consumers.=20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power the ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 In another development Wednesday state Controller Kathleen Connell=20 complained that the energy crunch is imperiling California's financial=20 health.=20 Connell said the state's power buying on behalf of Edison and PG&E is gutti= ng=20 its budget surplus. Since the state started making emergency power buys in= =20 January the surplus has fallen from $8.5 billion to about $3.2 billion sh= e=20 said.=20 Connell ordered an audit of the state's power buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is also refusing a request by Davis and the Legislature to transfer $5.= 6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its power= =20 buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Connell is a candidate for mayor of Los Angeles in next month's election.= =20 The ISO study meanwhile covered five major in-state power suppliers =01)= =20 Reliant Dynegy Williams/AES Duke Energy and Mirant as well as 16 power= =20 importers. All deliver power to customers of Edison PG&E and San Diego Gas= &=20 Electric Co. the state's three largest investor-owned utilities.=20 All overcharged but some excessively and some by moderate amounts said= =20 ISO's Sheffrin.=20 According to the report the overcharging took place beginning last May wh= en=20 the energy crisis began and continued through last month.=20 During that time according to the report energy suppliers commonly offere= d=20 their electricity at twice the amount it cost them to produce.=20 FERC member William L. Massey said he wasn't shocked to hear the amount=20 overcharged added up to more than $5 billion.=20 Prices over the past 10 months in California have greatly exceeded the=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said.=20 Chuck Griffin spokesman for Atlanta-based Mirant said the company would=20 justify their charges to FERC officials.=20 I think we're missing sometimes just how basic the problem is in Californi= a.=20 Supply and demand are out of whack and some basic rules of economics kick i= n=20 when that happens he said.=20 --- ------------- Disappearing state surplus sparks alarm=20 Controller puts hold on transfer of $5.6 billion to reserve funds By Karen Kucher and Ed Mendel=20 UNION-TRIBUNE STAFF WRITERS=20 March 22 2001=20 The state's general fund surplus has dropped to $3.2 billion from $8.5=20 billion since January largely because California's power purchases are=20 devouring the money state controller Kathleen Connell said yesterday.=20 Connell said she wants to see more documentation about state power spending= =20 before approving the transfer of $5.6 billion from the general fund to a=20 special reserve fund requested by Gov. Gray Davis.=20 Connell said the state would have to borrow $2.4 billion to cover the=20 transfer.=20 Report says power wholesalers overcharged California $5.5 billion=20 Outages darken economic outlook in state some say=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 We started this year with a generous budget surplus. The energy crisis has= =20 taken much of that away and this transfer on top of the electricity=20 purchases would put the (general) fund at risk Connell said in a statemen= t.=20 Her action came on a day when state power supplies improved. After two days= =20 of forced outages this week no rolling blackouts were ordered yesterday.= =20 Several power plants came back on line and imports from the Pacific Northwe= st=20 provided enough electricity to meet demand yesterday said Stephanie=20 McCorkle a spokeswoman with the California Independent System Operator=20 which manages most of the state's power grid.=20 Gradually more (electricity) generation comes on every day McCorkle said= .=20 By Monday we should see somewhere around 2200 megawatts back in service= =20 that was not on this Monday. That's if no other generation falls off.=20 Meanwhile Connell's move took some by surprise.=20 A spokesman for the state Department of Finance said Connell is denying a= =20 routine transfer that is required by law. It was just a routine accounting= =20 measure that we didn't anticipate becoming controversial Sandy Harrison= =20 said.=20 Connell announced the denial of the transfer a day after Davis endorsed one= =20 of her opponents former Assembly Speaker Antonio Villaraigosa in the race= =20 for Los Angeles mayor.=20 Connell who monitors California's cash flow said she was deeply concerne= d=20 about putting the state's general fund in a deficit situation in light of t= he=20 energy crisis.=20 About two months ago the state began spending about $50 million a day to b= uy=20 power after Pacific Gas and Electric and Southern California Edison nearly= =20 went bankrupt. It is also purchasing power for customers of San Diego Gas a= nd=20 Electric.=20 The Davis administration said earlier this week it soon will begin spending= =20 an additional $500 million on power purchases bringing the total to $4.2= =20 billion.=20 As that staggering sum continues to grow the state won a court battle with= =20 an electricity supplier yesterday. A federal judge in Sacramento sided with= =20 the state and ordered the wholesaler to continue selling to California=20 despite its fear that it will not get paid.=20 Judge Frank C. Damrell Jr. said Californians were at risk of irreparable ha= rm=20 if Reliant Energy Services stopped selling power to the Independent System= =20 Operator. The ISO acquires last-minute power on behalf of utilities to fill= =20 gaps in supply to try to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The judge said he had no authority to force the DWR to pay for the power.= =20 Davis has said the state isn't responsible for purchasing the costly=20 last-minute power the ISO buys for Edison and PG&E despite a law authorizi= ng=20 state power purchases on the utilities' behalf.=20 Meanwhile those who manage the power grid say the forecast for power=20 supplies this week looks good although conditions can change quickly.=20 ISO managers continue to stress the importance of conservation. Utility=20 customers across the state conserved about 900 megawatts of power Tuesday= =20 which kept blackouts from being ordered that night.=20 As the power crisis worsened this week ISO managers wished aloud that they= =20 still could rely on business customers to shut down in exchange for lower= =20 energy rates.=20 Such interruptible customers saved as much as 2100 megawatts last spring= =20 a figure that dropped to about 1700 last summer and 1400 at the end of th= e=20 year. But in January the state Public Utilities Commission told utilities= =20 they could no longer impose fines on business customers who refuse to shut= =20 down when asked.=20 ISO managers realize the program was harming businesses with frequent=20 interruptions of service -- but they still miss having that option McCorkl= e=20 said.=20 It would have made an enormous difference but at the same time we=20 understand the impact it was having on businesses McCorkle said. --- -------------- Outages darken economic outlook in state some say=20 By Dean Calbreath? UNION-TRIBUNE STAFF WRITER=20 March 22 2001=20 Until this week the San Diego Regional Chamber of Commerce was predicting= =20 that the county was well-insulated from the growing threat of economic=20 recession.=20 But that was before the lights went out in the chamber's downtown=20 headquarters Monday.=20 Working by window light in his darkened office chamber economist Kelly=20 Cunningham rapidly erased his previous projections for 3.5 percent growth f= or=20 San Diego County. Cunningham now feels the local economy could fall into a= =20 recession thanks to its shaky supply of energy.=20 Report says power wholesalers overcharged California $5.5 billion=20 Disappearing state surplus sparks alarm=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 Blackouts are very disruptive to the economy Cunningham said. A busines= s=20 can absorb rising energy prices by cutting costs or raising its own prices.= =20 But an energy shutoff is much less predictable. It cuts into productivity.= =20 Those sentiments are being echoed throughout California as business leader= s=20 and economists worry that rolling blackouts will darken the state's=20 previously glowing economy.=20 At the University of California Los Angeles for instance leading financia= l=20 theorists will meet April 4 to discuss the question Can California grow in= =20 the dark? Although the topic was chosen before the recent string of power= =20 outages the blackouts have given the issue new urgency.=20 These blackouts are not just a single episode said UCLA economist Tom=20 Lieser. They are a bridge to what will happen this summer. If we don't fal= l=20 into a recession in the second half of the year we will fall pretty close.= =20 Tapan Munroe an economist formerly with Pacific Gas and Electric this wee= k=20 crossed out his projection for 2 percent statewide growth. After blackouts= =20 rolled toward his consulting offices in the Bay Area city of Moraga Munroe= =20 decided the state will be lucky if it manages zero growth.=20 I'm a pretty optimistic guy by nature but this has been sobering Munroe= =20 said. On Tuesday one restaurant alone in San Francisco lost $20000.=20 Multiply that by all of the businesses that lost power in the state and=20 you've got a serious problem.=20 Two days of blackouts in San Diego County have hurt businesses large and=20 small. Among the industries under threat is the local biotechnology sector= =20 which requires a steady supply of electricity to power areas of laboratorie= s=20 that must remain temperature-controlled and sterile.=20 Continued blackouts could have a huge impact not only in dollars but=20 multiple millions of dollars said Tom Oster vice president of operations= =20 for BioCom the leading trade organization for the more than 200 biotechs i= n=20 San Diego County.=20 Idun Pharmaceuticals a biotech near La Jolla Village Drive that has 67=20 employees had its power cut for about 40 minutes Tuesday. Though the compa= ny=20 has a back-up generator some segments of its laboratories and lab equipmen= t=20 were not supported by it. Chemists also had to turn off some sensitive lab= =20 equipment to avoid the possibility of a damaging power surge once the=20 blackout was over.=20 We're not in a position as a small company to back up the whole facility= =20 said Steven Mento Idun's chief executive. We haven't done a survey yet to= =20 determine whether we had losses either in experiments or equipment damaged= =20 -- but we're hoping because the blackout was so short that damage will be= =20 minimal.=20 Mento said rolling blackouts coupled with continuing high energy costs=20 could cripple many small biotechs -- and even take a bite out of bigger mo= re=20 established companies.=20 We generate new compounds in controlled environments on a daily basis and= =20 when power goes off you can lose samples because of contamination and other= =20 issues Mento said. We are fortunate that our losses would be in having t= o=20 repeat an experiment -- but this could be really critical for companies wit= h=20 drug manufacturing and issues of quality control.=20 The wireless firms along Sorrento Valley have not been immune from blackout= s.=20 The lights went out at Qualcomm early this week although executives declin= ed=20 to comment about the impact.=20 No blackouts hit the big shipbuilding operations on the waterfront this wee= k.=20 But the National Steel and Shipbuilding Co. -- one of San Diego's largest= =20 employers -- already experienced a voluntary loss of power this year its= =20 first since World War II. Since the shipyard does not have its own power=20 supply NASSCO executives fear the effect of unplanned outages.=20 Our average payroll totals half a million dollars a day said NASSCO=20 spokesman Jim Scott. When you have a day's work disrupted that can be=20 pretty serious. We're currently in discussions about the possibility of=20 buying from independent power suppliers or setting up a power plant of our= =20 own.=20 Small businesses which constitute the bulk of employment in San Diego=20 County were hurt by disruptions as well -- costing them vital revenue at a= =20 time when their power bills have skyrocketed.=20 At Fantastic Sam's a hair salon in Chula Vista Angelica Alcala estimated= =20 that business dropped 60 percent when the blackouts hit Tuesday. Among othe= r=20 things Alcala had to alter her planned haircuts because she was relying on= =20 scissors instead of electric clippers.=20 At the Family Fun Center in El Cajon the management gave vouchers or refun= ds=20 to the 15 or so video-game players who were in the midst of killing aliens = or=20 fighting ninja warriors as the power went down.=20 Papa John's Pizza estimates that it may have lost several thousand dollars = in=20 business after six stores were blacked out Monday and four others lost powe= r=20 Tuesday. Brian Mills who runs 23 Papa John's stores in the county said hi= s=20 main concern was shutting down the computers so they would not be damaged b= y=20 a power surge when the electricity was restored.=20 Paul Ecke III a member of the West Coast advisory panel for the Federal=20 Reserve said the potential impact of the energy crisis is worse than any= =20 downturn in the stock market.=20 Ecke who runs the Paul Ecke Ranch flower operation in Encinitas said the= =20 crisis could be particularly harmful for the state's agricultural sector= =20 since farmers need electricity to pump water and natural gas to heat=20 greenhouses.=20 What I'm really worried about is the energy thing is going to cast a shado= w=20 on California he said. If you're a business person thinking about moving= =20 to California right now you're probably not going to do it because you're= =20 not sure you're going to have your lights on this summer.=20 Besides the disruption to businesses the energy crisis is also hurting the= =20 pocketbooks of hourly workers who have been sent home during the crisis.=20 Under state law employers are free to send hourly workers home without pay= =20 during such emergencies although salaried workers must still be paid.=20 Susan Kemp an attorney with the California Chamber of Commerce said there= =20 are ways of minimizing the impact on hourly workers.=20 You have to look at what time it is when the blackout occurs and how long= =20 you think it's going to last Kemp said. If it's around a meal time you= =20 might send the workers out for a longer meal period if you think it's going= =20 to be an hour or hour and a half delay.=20 But the potential for losing wages doesn't sit well with the hourly workers= .=20 When you get sent home early and lose your wages you have even less money= =20 to pay your inflated energy bills said an hourly worker who was sent home= =20 during Monday's blackout.=20 --- ---------- Out-of-state generators question power regulators' authority=20 By Karen Gaudette ASSOCIATED PRESS=20 March 22 2001=20 SAN FRANCISCO =01) At least three major out-of-state electricity generators= are=20 challenging the authority of the California Public Utilities Commission to= =20 investigate whether they deliberately reduced power supplies to drive up=20 prices.=20 The PUC has asked for power plant maintenance records as it tries to=20 determine whether Duke Energy Dynegy Inc. Mirant Corp. and other=20 wholesalers have manipulated the energy market at California's expense.=20 At issue is who ultimately controls oversight of in-state plants that provi= de=20 most of California's electricity. The plants once owned by the state's=20 largest utilities were sold off as part of the state's 1996 attempt at=20 deregulation.=20 Report says power wholesalers overcharged California $5.5 billion=20 Disappearing state surplus sparks alarm=20 Outages darken economic outlook in state some say=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 PUC President Loretta Lynch said the public deserves to know whether=20 generators have unnecessarily taken plants off-line to create artificial=20 shortages forcing the utilities and now state bureaucrats to buy much high= er=20 priced power on the spot energy market.=20 What I do know is we have historically high levels of outages across the= =20 board Lynch told The Associated Press. Dynegy and Duke have been fightin= g=20 the PUC in the PUC's quest to obtain documents about these outages.=20 The PUC has the authority to regulate facilities within its borders she=20 added. It doesn't matter where the headquarters of the company is.=20 Duke based in North Carolina says it does matter =01) and that since it a= nd=20 other wholesalers aren't headquartered in California the PUC can't require= =20 it to turn over the maintenance records.=20 We have not given them proprietary information because they do not regulat= e=20 us said Duke's spokesman Tom Williams.=20 Dynegy did not return calls for comment Wednesday.=20 The PUC also faces a new challenge in the legislature. A bill sponsored by= =20 Assemblywoman Carole Migden D-San Francisco which would have granted the= =20 PUC greater inspection authority over out-of-state generators was amended= =20 this month to grant the authority to Independent System Operator instead.= =20 The ISO has managed the delivery of energy through most of the state's powe= r=20 grid but historically has done little regulating and has had no policing=20 authority.=20 This board created during the state's 1996 attempt at deregulation was=20 redesigned in January. Now it has a five-member board appointed by Davis= =20 replacing a 26-member ISO board composed of utility executives marketers= =20 power plant owners and others.=20 The latest version of Migden's bill requires wholesalers to report monthly = to=20 the ISO about any plants that are off-line or working at reduced capacity= =20 and gives the ISO power to audit these reports.=20 But because the ISO board historically has made key decisions behind closed= =20 doors and is exempt from certain open-government regulations government=20 watchdogs are outraged by the switch.=20 The PUC's been no friend of ratepayers but at least under the constitutio= n=20 and state law they're required to conduct their process in the open and the= =20 public can intervene said Harvey Rosenfield of the Foundation for Taxpaye= r=20 and Consumer Rights.=20 Davis ordered last month that the ISO take the lead among state agencies to= =20 ensure adequate energy supplies. Alan LoFaso an aide to Migden said the= =20 amendment follows Davis' lead.=20 Both LoFaso and the governor's spokesman Steve Maviglio downplayed the=20 change. I don't know if we have a preference as to which state agency get= s=20 the authority to continue the probe Maviglio said.=20 The challenge by Duke Energy Houston-based Dynegy Inc. and Mirant Corp. of= =20 Atlanta came in filings March 12 asking for a rehearing of the PUC's Februa= ry=20 resolution reasserting its legal authority to examine the books accounts= =20 memoranda contracts and records of generators selling energy to utilities= =20 already subject to PUC regulation.=20 Those utilities include Pacific Gas and Electric Co. and Southern Californi= a=20 Edison Co. which have been nearly bankrupted buying power from wholesalers= =20 as well as the financially troubled San Diego Gas and Electric -- Allegheny Energy makes big California connection=20 ASSOCIATED PRESS=20 March 22 2001=20 HAGERSTOWN Md. =01) Allegheny Energy Inc. said Thursday it has agreed to s= ell=20 $4.5 billion worth of power to California's electricity-purchasing agency= =20 over the next 10 years.=20 The company said the contract call for Allegheny to provide up to 1000=20 megawatts that the Hagerstown-based company has secured from western=20 generating plants through its new energy trading division Allegheny Energy= =20 Global Markets =01) formerly Merrill Lynch Global Energy Markets.=20 This is a win-win for both the state of California and Allegheny Energy. I= t=20 provides a long-term source of fixed-price energy and should help to=20 stabilize prices in California said Michael P. Morrell president of the= =20 Allegheny Energy Supply division.=20 --- ----------- Judge Frees Small Firm From Edison Contract=20 By KEN ELLINGWOOD and DAN MORAIN Times Staff Writers=20 ?????EL CENTRO--California's balance of electrical power shifted slightly= =20 Thursday when an Imperial County judge temporarily freed a small geothermal= =20 energy producer from its contract with Southern California Edison allowing= =20 it to sell power on the open market. ?????The ruling by Superior Court Judge Donal B. Donnelly could lead to a= =20 mass exodus by hundreds of small energy producers that have been selling=20 power to the state's financially troubled utilities for months without=20 getting paid. ?????At the same time it may have staved off plans by a group of the small= =20 generators to send Edison into involuntary bankruptcy as early as today. ?????In Sacramento energy legislation pushed by Gov. Gray Davis passed in= =20 the state Senate but foundered in the Assembly. The measure was intended to= =20 ensure that the state gets repaid for the electricity that it has been buyi= ng=20 on behalf of Edison and Pacific Gas & Electric which say they lack the cas= h=20 and credit to purchase power. The bill also was supposed to guarantee that= =20 the small alternative energy producers--which together provide nearly a=20 third of the state's power--get paid. But Assembly Republicans opposed it= =20 saying it hadn't been given sufficient scrutiny. ?????The impact of the small producers was made clear in Imperial County= =20 where Edison's failure to pay CalEnergy the county's biggest property=20 taxpayer had outsize implications. CalEnergy had put county officials on= =20 notice that it was about to miss a $3.8-million property tax payment. The= =20 uncertainty had prompted the tiny Calipatria Unified School District to=20 postpone a bond issue for badly needed school repairs. ?????Among CalEnergy Chairman David Sokol's first acts after the judge's=20 ruling Thursday was to promise Imperial County Supervisor Wally J. Leimgrub= er=20 that the company would pay its property taxes on time. ?????That is great news Leimgruber said. ?????Within hours of its court victory CalEnergy had stopped transmitting= =20 geothermal power to Edison and begun selling it to El Paso Energy a=20 marketing company that purchased the energy at prevailing rates and resold = it=20 on the spot market. ?????Some of the more than 700 other small energy producers in the state sa= id=20 they were considering similar action against Edison and Pacific Gas &=20 Electric. ?????We absolutely need the right to sell to third parties said Dean=20 Vanech president of Delta Power a New Jersey company that owns five small= =20 gas-fired plants in California and is owed tens of millions of dollars by= =20 Edison. ?????Sokol praised the Imperial County judge and said his company simply=20 wanted the authority to sell its power to a credit-worthy company that in= =20 fact pays for the power. ?????An Edison spokesman said the company was disappointed with the ruling= =20 but sympathized with CalEnergy and other small producers because=20 California's power crisis has placed [them] in financial distress just as= =20 it has placed utilities in financial distress. ?????Edison expressed concern that the ruling would prompt CalEnergy and=20 other small producers to sell their power out of state. Sokol said CalEnerg= y=20 had specifically told El Paso Energy that it hoped its power would remain i= n=20 California but if someone wants to pay a higher price out of state we=20 can't stop them. ?????Sokol said that Edison still owes CalEnergy $140 million and that the= =20 company--along with seven other small producers--had been prepared to file = a=20 petition in federal bankruptcy court in Los Angeles today forcing the utili= ty=20 into involuntary bankruptcy. He said his company no longer intends to do so= =20 and he believed--but wasn't certain--that the other companies would shelve= =20 their plans. ?????Edison filed papers Thursday with the federal Securities and Exchange= =20 Commission showing that it owed $840 million to various small electricity= =20 producers many of which rely on renewable energy sources such as geotherma= l=20 steam solar energy or wind. ?????The alternative energy producers--and utilities--strenuously objected = to=20 the legislation considered in Sacramento on Thursday. The bill spelling ou= t=20 how the utilities are to pay the state and the small producers passed the= =20 Senate on a 27-9 vote the exact two-thirds margin required. But it stalled= =20 in the Assembly on a 46-23 party-line vote well short of two-thirds. ?????When I was a citizen back in Lancaster I heard these stories about= =20 pieces of legislation that were cooked up late at night that . . . were cu= t=20 and pasted together and were rammed through by the Legislature Assemblyma= n=20 George Runner (R-Lancaster) said. That's exactly what we have before us. ?????The alternative electricity generators including oil companies warne= d=20 that they would lose money under the Davis proposal while representatives = of=20 Edison and PG&E which have amassed billions in debt in the worsening energ= y=20 crisis said the legislation would push them deeper into the hole. ?????There isn't enough money Edison attorney Ann Cohn testified at a=20 Senate hearing on the bill Thursday. It is a very simple question: Dollars= =20 going out cannot be greater than dollars coming in. ?????The bill AB 8X combined several proposals. First it sought to clari= fy=20 earlier legislation by spelling out that Edison and PG&E must pay the state= =20 all money collected from consumers for electricity that the state has been= =20 buying. ?????Additionally the bill would turn over to the California Public=20 Utilities Commission the thorny issue of how much to pay alternative energy= =20 producers for their electricity. ?????Wind solar and geothermal producers might agree to the prices offered= =20 by the administration. But most of the alternative energy producers=20 including Chevron and British Petroleum use natural gas to generate=20 electricity through cogeneration a process of creating steam for both=20 electric generation and heat. With natural gas prices high they contend= =20 they would lose money at the prices Davis is offering. ---=20 ?????Ellingwood reported from El Centro Morain from Sacramento. Times staf= f=20 writers Mitchell Landsberg in Los Angeles and Jenifer Warren Nancy Vogel a= nd=20 Carl Ingram in Sacramento contributed to this story. --- ------------------- Lodi Defies Order for Blackouts=20 Utility tells PG&E to 'pay the bills'=20 Alan Gathright Chronicle Staff Writer Friday March 23 2001=20 2001 San Francisco Chronicle=20 URL:=20 /23/M N171303.DTL=20 Let history show that the rebellion against rolling blackouts started when= =20 the Central Valley town of Lodi defied PG&E and refused to unplug its=20 customers this week.=20 Like several cities that own their own utilities Lodi saw the energy crunc= h=20 looming last fall and spent millions for long-term power contracts in an=20 attempt to avoid blackouts.=20 Now Lodi and a Northern California municipal utility cooperative that=20 includes Palo Alto Santa Clara and Alameda are telling Pacific Gas and=20 Electric Co. that it's unfair to force their customers to endure blackouts= =20 triggered by the near-bankrupt utility's failure to pay its debts.=20 The problem is not paying bills so pay the bills said Alan Vallow=20 director of the utility serving Lodi's 58000 residents. I won't arbitrari= ly=20 screw my customers . . . so 5000 PG&E customers can turn on their lights= =20 somewhere else.=20 When PG&E relayed an order from state power regulators Monday and Tuesday f= or=20 Lodi to black out some of its customers a strategy intended to keep the=20 West's power grid from collapsing Lodi said no.=20 So far other cities in the Northern California Power Agency say they will= =20 continue to participate in rotating outages.=20 But in a letter last Friday to PG&E members of the agency and four other= =20 utility districts including Sacramento's warned they didn't believe long-= =20 standing agreements that allow them to use PG&E transmission lines to conne= ct=20 to the grid obliged them to endure rolling blackouts because of PG&E's=20 failure to pay its power obligations.=20 They say the agreements require them to reduce power demand only in respons= e=20 to natural disasters or malfunctions damaging power lines or plants.=20 The agencies asked for a meeting with PG&E President Gordon Smith before=20 anticipated summer blackouts hit to develop a more rational program for= =20 allocation of risks associated with (power demand) load shedding before you= =20 call on us to participate in load shedding again.=20 REFUSING TO SHARE BURDEN PG&E officials accused Lodi of selfishly refusing to share the burden of th= e=20 statewide energy crisis.=20 It is regrettable that after reaping the benefits of the (power grid)=20 interconnection contract for many years Lodi is suddenly unwilling to bear= =20 their share of the burden of the statewide energy crisis said PG&E=20 spokesman Ron Low. When cities like Lodi do not follow the (state=20 Independent System Operator's) order to curtail power it hurts all of=20 California and jeopardizes the entire power grid.=20 Low also disagreed with accusations that this week's blackouts were trigger= ed=20 by PG&E's failure to pay its bills noting that the ISO stated that 12000= =20 megawatts of power were offline because of plant maintenance.=20 But ISO spokeswoman Lisa Szot confirmed assertions by the municipal utiliti= es=20 that power generators had kept an additional 3000 megawatts offline becaus= e=20 they feared PG&E couldn't pay.=20 Lodi's Vallow said he was legally obliged to serve city customers. Lodi=20 residents are facing rate increases of as much as 15 percent under a power= =20 contract that the city secured in hopes of avoiding blackouts. The contract= =20 required Lodi to pay a $10 million premium above its typical $23 million=20 annual energy bill.=20 'THAT'S NOT FAIR'=20 I've been hearing (PG&E say) 'Gee that's not fair. Where's the equity if= =20 everybody is doing rolling blackouts and you're not?' Vallow said. Well= I=20 put my customers at financial risk to the tune of $10 million. And if they'= re=20 not going to get to use that power they paid for then by God give us that= =20 money back.=20 Vallow said he was willing to sell PG&E some of Lodi's power surplus knowi= ng=20 Lodi might not be paid.=20 But I'm not willing to turn off 5000 customers so 5000 customers=20 somewhere else can turn their lights on Vallow said. The objective here= =20 people is to keep as many lights on as possible.=20 Other city-owned utilities while annoyed with the rolling blackouts aren'= t=20 going as far as Lodi.=20 WEATHERING BLACKOUTS I certainly understand the frustrations of utilities like Lodi and actuall= y=20 share those frustrations in many cases said John Roukema assistant=20 director of Santa Clara's utility.=20 But he stressed that his agency had been able to weather blackouts without= =20 hurting residents or small business because 17 major industrial power user= s=20 had agreed to curtail demand during energy alerts.=20 The prudent thing to do at this time is to continue to do our share and=20 participate in rolling blackouts because a single problem could cause a=20 catastrophic failure in the statewide system Roukema said.=20 In Alameda residents endured blackouts this week despite the fact that cit= y=20 has secured reliable power supplies said Matt McCabe spokesman for Alamed= a=20 Power & Telecom.=20 It was in the best of interests of Alamedans to maintain the stability and= =20 integrity of the grid he said. Now if it becomes evident that the syste= m=20 is being jeopardized for financial reasons then we should not have to=20 subject Alamedans to rolling blackouts.=20 In Palo Alto which also had blackouts this week utility officials told th= e=20 City Council they were expecting a 30 to 40 percent rate hike this spring t= o=20 pay new contracts guaranteeing a stable power supply said Councilman Bern= =20 Beecham. The city hopes to avoid giving customers the double whammy of rate= =20 boosts and more blackouts with a program that gets industrial users to cut= =20 demand voluntarily during alerts.=20 When there's not enough generating capacity in the state to protect the=20 integrity of the grid that is in fact everybody's problem Beecham said= =20 but that doesn't mean Palo Alto is willing to endure blackouts to prop up= =20 PG&E's ailing finances.=20 We need to have some very frank discussions with PG&E about mutual=20 obligations Beecham said.=20 Energy Tips=20 With Californians facing electricity and natural gas shortages PG&E has=20 several tips to help conserve both:=20 -- Set the furnace thermostat at 68 degrees or lower health permitting.=20 -- Wash only full loads in a dishwasher. If operating instructions allow= =20 turn dishwasher off before the drying cycle and let dishes dry naturally.= =20 -- Use low-wattage or fluorescent lights.=20 -- Fix defective plumbing and dripping faucets which waste water and=20 increase the gas or electric bill for heating the water.=20 -- Plug gaps around pipes ducts fans and vents that go through walls=20 ceilings and floors.=20 -- Keep furnaces clean and clean or replace the filter regularly.=20 -- Turn heaters down when using a fireplace and close the damper when not= =20 using the fireplace.=20 -- On sunny days open drapes on windows facing south and let the sun shine= =20 in. At night close the drapes to retain indoor heat.=20 Source: www.pge.com=20 E-mail Alan Gathright at 2001 San Francisco Chronicle ? Page?A - 1=20 --- Coming Down to the Wire=20 State legislators battle over alternative energy bills=20 Greg Lucas Robert Salladay Chronicle Sacramento Bureau Friday March 23 2001=20 2001 San Francisco Chronicle=20 URL:=20 /23/M N113351.DTL=20 Sacramento -- After several weeks of slow to no progress in attacking the= =20 state's energy mess the Legislature erupted yesterday into a frenzy of=20 energy activity.=20 The sudden action on a series of energy bills -- including one to let=20 businesses buy power directly from generators -- stemmed initially from the= =20 fear of bad publicity lawmakers might receive for a planned three-day junke= t=20 next week to Washington D.C.=20 When a key bill bogged down in the Assembly late yesterday Speaker Bob=20 Hertzberg D-Sherman Oaks announced the trip was canceled.=20 Another reason for the flurry of action was recognition that time is runnin= g=20 out.=20 Several alternative energy producers -- like wind farms and biomass plants = -=20 - said they were one day away from forcing the state's two biggest utilitie= s=20 into bankruptcy because they were owed more than $1 billion.=20 The Legislature's action and a court ruling that could free alternative=20 producers from unpaid contracts.=20 This is triage members of the Senate said Sen. Jim Costa D-Fresno. Th= is=20 is crisis activity we're engaged in.=20 The Senate approved a bill aimed at helping state regulators get cash to so= me=20 alternative energy producers. Most of them have been paid little or nothing= =20 since November by the utilities they sell electricity to.=20 Senators passed a bill to help the Public Utilities Commission order=20 utilities to pay solar wind and other alternative energy producers who sig= n=20 lower-priced contracts with the utilities.=20 The bill failed in the Assembly because of GOP opposition fanned in part b= y=20 price concerns by the oil industry a major co-generation producer. The=20 Assembly is set to meet again today to try again pass the bill which the P= UC=20 needs to issue its final order.=20 The PUC's proposed order offers the first hint of financial relief for=20 hundreds of alternative energy producers known as ''qualified facilities = in=20 the energy industry who have been paid just pennies on the dollar by cash-= =20 strapped Pacific Gas & Electric and Southern California Edison.=20 Lack of payments has caused many alternative generators to shutter their=20 operations.=20 The PUC's proposal which will be considered at the commission's meeting=20 Tuesday offers generators a choice of agreeing to a five-year contract at= =20 $79 per megawatt or a 10-year deal at $69 per megawatt Davis said. The goi= ng=20 rate now is about $150 a megawatt hour.=20 The order does not address money already owed to the more than 600=20 alternative energy producers.=20 Under the order utilities would have to pay any generator who signed the n= ew=20 contracts within two weeks.=20 But PG&E said it might not be able to afford do that.=20 Operators of co-generation facilities say the contracts contemplated by the= =20 PUC don't cover their cost of producing energy because the sale price no=20 longer would be pegged to the the price of natural gas.=20 In a significant court decision affecting generators one geothermal energy= =20 supplier in Imperial County won a lawsuit yesterday against Edison allowing= =20 the company to escape a contract requiring it to sell electricity to the=20 utility.=20 A superior court judge said CalEnergy operator of the geothermal plant=20 could suspend deliveries to Edison and sell the 268 megawatt hours it=20 generated on the open market.=20 CalEnergy is owed $75 million by the utility.=20 The court victory may ease mounting pressure from some qualified facilities= =20 including CalEnergy to drive one or both of the utilities into involuntary= =20 bankruptcy.=20 The Assembly and Senate meanwhile rushed through a series of bills aimed = at=20 increasing energy conservation and rushing the building of new power plant= s.=20 Most significant for bigger residential and commercial utility customers is= a=20 measure passed by the Assembly to allow energy customers to buy power=20 directly from generators.=20 That right was eliminated in January when the state began buying power for= =20 the cash-strapped utilities.=20 The bill approved unanimously yesterday would impose a yet to be determined= =20 exit fee on customers who leave the power grid to help cover the state's=20 financial exposure.=20 Tell Us What You Think=20 Can you save 20 percent on your energy use? Gov. Gray Davis' administration= =20 is offering rebates for Californians who save on power starting in June an= d=20 if you've got a strategy for conserving The Chronicle wants to hear it.=20 We'll be writing about the hardest-working energy savers in a future story.= =20 To get involved write to the Energy Desk San Francisco Chronicle 901=20 Mission St. San Francisco CA 94103 or e-mail energysaver@sfchronicle.com= .=20 E-mail the reporters at glucas@sfchronicle.com and bsalladay@sfchronicle.co= m.=20 2001 San Francisco Chronicle ? Page?A - 14=20 --- State's bill for energy could double this year=20 Posted at 9:34 p.m. PST Thursday March 22 2001=20 BY=20 STEVE=20 JOHNSON=20 AND=20 JOHN=20 Warning that California is imperiled by the prices it is paying for=20 electricity a report Thursday said the state's annual power tab could wind= =20 up being 10 times what it was two years ago.=20 At the current rate of spending the report estimated that the total=20 electricity bill in California this year could hit $70 billion which is mo= re=20 than twice what it was last year and about 10 times what was paid in 1999 a= nd=20 1998.=20 ``The California electricity market has gone from being `dysfunctional' to= =20 precipitating a crisis'' according to the report from the Independent Syst= em=20 Operator.=20 It added that the price being charged ``threatens any semblance of just and= =20 reasonable consumer rates the financial viability of California's=20 investor-owned utilities the financial stability of California of its=20 neighboring states and of the nation.''=20 While power suppliers denied any wrongdoing the report said the state=20 appears to have been hit with ``excess'' charges totaling $6.87 billion sin= ce=20 May based on an assessment of the typical operating costs of power plant= =20 owners. Out of that total $6.2 billion appeared to be excessive charges=20 during times when power was not in particularly short supply the agency=20 said.=20 The cost of power has become a growing concern now that the state has stepp= ed=20 in to buy it on behalf of Pacific Gas & Electric Co. and Southern Californi= a=20 Edison which claim to be so strapped for cash that they are on the verge o= f=20 bankruptcy.=20 In making public the report which was sent to the Federal Energy Regulator= y=20 Commission officials at the Independent System Operator were careful not t= o=20 accuse any power companies of price gouging. While the prices appeared to b= e=20 unreasonable they said the state needs to learn more about the specific= =20 operating costs of power plant operators before they could determine whethe= r=20 California was cheated.=20 The officials said they were considering asking the federal agency which= =20 oversees power wholesalers to order the suppliers to make refunds. In the= =20 past two weeks the federal agency has warned a number of suppliers that th= ey=20 may have to refund $135 million in apparent overcharges during January and= =20 February.=20 But many experts question whether the federal agency is serious about=20 demanding such refunds so California officials also are reviewing the=20 possibility of suing the suppliers or seeking criminal charges against some= =20 of them. ``We're working very closely with a number of agencies to review t= he=20 information we currently have to determine what remedies may be available'= '=20 said Charles Robinson the Independent System Operator's general counsel.= =20 The report's suspicions were partly bolstered by another study made public= =20 Thursday by the state auditor. It said California's market structure=20 encouraged bidding gamesmanship by both utilities and power sellers ``in an= =20 effort to manipulate wholesale prices to their advantage.'' But it stopped= =20 short of accusing power generators of profiting illegally.=20 ``There's clearly some evidence of market abuse'' said state Auditor Elain= e=20 Howle. Even so she added ``that's not to say it's anything illegal. We=20 hired consultants they looked at some of the bidding and they weren't=20 comfortable going that far.''=20 Although no power companies were named in either report officials with=20 several suppliers insisted they have done nothing wrong.=20 ``We've conducted our business legally and ethically'' said Richard=20 Wheatley spokesman for Reliant Energy which runs five major California=20 power plants. ``The ISO report appears to be nothing more than just another= =20 attempt to put blame at someone else's doorstep when there's been very=20 little action out of Sacramento to resolve the problems in the California= =20 marketplace.''=20 Duke Energy spokesman Jeremy Dreier said the company which runs plants in= =20 Moss Landing and Morro Bay sold most of its power last year and this year = in=20 relatively low-cost long-term contracts and was among the first to offer= =20 such deals to the state. He added that Duke increased production from its= =20 aging plants to meet surging demand.=20 ``The fact that we were among the first to bring long-term contracts to the= =20 table speaks volumes about how we're trying to serve this market'' Dreier= =20 said.=20 John Sousa of Dynegy Inc. which co-owns three major California plants add= ed=20 that ``given the market conditions the rates we charged were just and=20 reasonable.''=20 --- Plan for alternate power plants stalls=20 Posted at 10:03 p.m. PST Thursday March 22 2001=20 BY DION NISSENBAUM AND JENNIFER BJORHUS=20 Mercury News=20 SACRAMENTO -- The state's prospects for plugging a critical electricity gap= =20 dimmed Thursday when the state Assembly rejected a rescue plan for=20 alternative power companies and a state judge ruled that one such firm coul= d=20 stop selling energy in California.=20 Both actions threaten the plan Gov. Gray Davis announced just Tuesday to ke= ep=20 these companies running and stave off more blackouts. With the state's=20 troubled utilities failing to pay for their electricity many alternative= =20 energy plants have been shutting down.=20 The dual blows came on a day when tempers flared in the Capitol as lawmaker= s=20 jarred by back-to-back blackouts launched bipartisan attacks on Pacific Gas= &=20 Electric Co. and Southern California Edison which aren't paying wind sola= r=20 biomass geothermal and small gas-fired plants for their electricity.=20 After Republicans shot down the measure meant to keep alternative energy=20 companies in business Assembly Speaker Robert Hertzberg D-Van Nuys warne= d=20 that the restless companies might act on their threat to force the utilitie= s=20 into bankruptcy.=20 ``They said it and I understood them to mean it'' he said.=20 The failure overshadowed a burst of action in Sacramento where lawmakers=20 approved a host of other measures. The Senate approved two key bills: one= =20 that would spend more than $1 billion to encourage Californians to conserve= =20 energy and one that would make it easier to build power plants. The Assembl= y=20 approved 14 incremental bills.=20 Six votes short=20 But the Assembly fell six votes short of passing a hastily prepared bill=20 meant to help prop up the nearly 700 alternative energy companies many of= =20 which are now idle.=20 Those closings sapped California of energy this week and helped cause two= =20 days of rolling blackouts -- the first since January.=20 In response Davis and lawmakers cobbled together a plan to set new lower= =20 rates for alternative power and to fine the utilities if they refuse to pay= =20 these companies which supply up to a third of the state's power.=20 But Republicans refused to back the measure and said it contained too many= =20 complex parts that needed more time to analyze.=20 ``Everyone in this room knows that this piece of legislation has not had a= =20 good look'' said Assemblyman George Runner R-Lancaster.=20 Assemblyman Fred Keeley D-Santa Cruz castigated the Republicans and=20 implored them to accept an imperfect solution.=20 ``Ladies and gentlemen: Welcome to the NFL'' he said. ``Welcome to the wor= ld=20 where large complex issues don't have a simple solution.''=20 Approval is needed before state regulators at the Public Utilities Commissi= on=20 can vote on the fine points of the plan. That was supposed to happen Tuesda= y.=20 Much of the criticism focused on concerns raised by power plants that use= =20 natural gas to produce energy. Administrators from those plants said the=20 Davis price caps would make it impossible for them to break even.=20 The derailment came hours after the measure narrowly won approval in the=20 state Senate.=20 Hertzberg plans to search for a compromise today and canceled plans for the= =20 Assembly's annual trip to Washington.=20 Thursday's actions were highlighted by angry attacks on the utilities by=20 frustrated lawmakers.=20 ``I hope they do go bankrupt'' shouted Senate President pro tem John Burto= n=20 D-San Francisco during a debate on the energy crisis. ``Let them go belly= =20 up. I don't care any more.''=20 Legal decision adds twist=20 The legislative failure was compounded by a legal decision in Southern=20 California that further complicated the picture.=20 A Superior Court judge in Imperial County cleared the way for CalEnergy=20 Operating Corp. to break its contract with Edison and sell its 268 megawatt= s=20 of power on the open market. The judge concluded that Edison had breached i= ts=20 contract by failing to pay CalEnergy since November.=20 That ruling could pave the way for hundreds of others to follow suit and=20 drain off power California needs to prevent blackouts.=20 ``It's not good'' said V. John White director of the Center for Energy=20 Efficiency and Renewable Technologies. ``This is potentially going to chang= e=20 the dynamics of the situation and probably not for the better.''=20 Jan Smutny-Jones executive director of the Independent Energy Producers=20 Association said it was unclear whether other companies would sue.=20 ``I think this is a very significant development'' he said. ``We're sort o= f=20 at a period where the industry's reaching the end of the rope.''=20 The ruling did have one silver lining: CalEnergy Chairman David Sokol said= =20 his company and seven others had planned to force Edison into bankruptcy if= =20 they lost in court.=20 But he also warned ``You stick a sharp stick in enough people's eyes and= =20 they get pretty tired of it.''=20 The situation with generators supplying PG&E isn't as dire since the compan= y=20 has been making partial payments.=20 Kent Burton senior vice president for Covanta Energy Corp. in New Jersey= =20 said ``They've tried to be responsive.''=20 Mercury News Staff Writer Mark Gladstone contributed to this report. Contac= t=20 Dion Nissenbaum at dnissenbaum@sjmercury.com or (916) 441-4603 or Jennifer= =20 Bjorhus at jbjorhus@sjmercury.com or (408) 920-5660. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request for Confidential Information by the US GAO Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enrons natural gas policy positions Body:: coule you get Jeannie copies of the slides or other write ups you have on this. Jeannie -- I don't know how far it is prudent to take a position on this as a co. It has already become a key battleground (garnering some discussion in the Gore-Lieberman debate). I think we stay away from it as a co. but we at least ought to put the information in front of anyone we are asking to do an oped so that they can make a reasoned judgement. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Questions for Executive Business Review- URGENT Body:: I share your perceptions of Jose though I don't have as much contact as you do. I know also from some recent discussions with Rick (who has also had a fair amount of contact with Jose) that he has very positive views on Jose's work. I think we should make a concerted effort to get the feedback and have a good discussion about Jose at year end to ensure that he is properly ranked. James M Bannantine@ENRON_DEVELOPMENT 10/03/2000 07:13 PM To: Steven J Kean@EES cc: Subject: Re: Questions for Executive Business Review- URGENT ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: Another agenda item I got a call today from Bob Pease Attorney with Market Oversight and Enforcement at FERC 202-208-0131 to invite Enron to a meeting called by Chairman Wood at the CAISO offices on 24-25 Sep 01. The purpose of the meeting is to try to get the FERC CAISO DWR and other market participants to work out issues related to reliability that have arisen in recent months. Issues include those that that affect operations and reliability such as the must-offer requirements ramping etc. He was not clear as to whether they would address creditworthiness issues. From the FERC staff non-decisional employees will attend. He invited solutions/proposals in advance of the meeting. Enron needs to decide who to send. Alan Comnes What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL - ATTORNEY WORK CLIENT PRIVILEGE ASSERTED Body:: Paul -- Can we have a phone call with our Reg team on Friday to make sure that everything is a-ok? I want one final run through. If yes please let me know by phone and I'll ask Linda Noske to set up the call. Also I owe you a call on Sue / Jeff. Are you in Thurs? Jim What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Report on Senate Energy Hearing Today Body:: Earlier today the Senate Energy Committee held the first of two days of hearings on Chairman Bingaman's white paper on electricity and the electricity provisions of other pending bills. The hearings will continue tomorrow with all of the five FERC commissioners as witnesses plus private sector witnesses. Today's hearing went well from our perpective with support for Super RTOs and general support for expanding the grid both physically and from an access view point voiced by Senators and witnesses. Sen. Craig Thomas even said four RTOs were too many -- there should be one national RTO to run a national grid. Today's witnesses represented the Dept. of Energy EPSA EEI NRECA APPA IBEW union Alliance to Save Energy ELCON NERC NARUC NASUCA and the State of New Mexico. We will provide a more detailed analysis after completing a review of the lengthy written testimony but a summary of the DOE testimony and the first panel of private sector witnesses follows. 1. DOE said they are working on electricity legislative language. Should be done soon. Chairman Bingaman said they needed to get it done in time for the Committee to consider it when the Committee takes up electricity as early as the second week in September. Deputy Sec. Blake implied that their proposal was or would soon be shared with other Administration agencies for review. 2. In response to questions Blake said that legislative action on jurisdiction questions (fed v. state) would be useful but he stressed that they view any new legislation as clarifying that FERC has authority they feel already exists. He said that while states have an important role to play Congress must recongize the interstate character of the market and the need for open access to the interstate grid. (In response to a question Blake later said that FERC had largely addressed the access issue or would do so.) 3. On reliability he was given a chance to say that DOE supports th NERC consensus language but instead repeated that the Administration favors enforceable reliability standards but wants to work with the Committee on the exact language. I took this as confirmation of what we have heard informally from DOE in terms of key players there not being enamored of the NERC consensus approach at least as it exists in its old long form. 4. Sens. Craig and Cantwell pushed Blake on why the Administration has not fully supported BPA's request for a debt limit increase to finance expansion of the BPA grid. Blake said they support the BPA expansion projects but that OMB feels BPA has enough borrowing authority through 2003. This did not sit well with Craig and Cantwell. I spoke with Sen. Craig in the hall following up on a conversation I had with him the other evening about BPA and he stressed that he is committed to getting BPA the debt limit it needs. As you know commercial has asked us to help BPA given matters pending between Enron and BPA. 5. On the first private sector panel even John Rowe the Co-CEO of Exelon and past EEI chairman (testifying for his company and EEI) said several times that there should be strong RTOs that each cover a wide idea. He said his board voted yesterday to sell its transmission assets IF a strong independent operator could be found. Rowe also said that RTOs should be encouraged (implying not mandatory?). The APPA witness was strong on RTOs saying that all entities will be part of RTOs even without legislation. NRECA said that co-ops would oppose federal jurisdiction over them and that they favor voluntary RTOs. EPSA made the usual case for competition open access RTOs etc. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Draft letter to Paul Joskow for Ken Lay Body:: I think this letter looks fine. For the hororarium I suggest we use whatever we paid Kudlow for his participation (I believe Ken also entered into a consulting contract with Kudlow but I'm referring only to the one-time payment for the advisory council meeting he attended). ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Economic Espionage Act Presentation - August 15th Body:: calendar -- FYI ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential Folder to safely pass information to Arthur Andersen Body:: Good idea. Is there a way to monitor usage of this folder is insure that everyone has read and complied with your message? From: Beth Apollo/ENRON@enronXgate on 04/10/2001 08:52 AM To: Shona Wilson/NA/Enron@Enron Jeffrey C Gossett/HOU/ECT@ECT Stacey W White/HOU/ECT@ECT D Todd Hall/ENRON@enronXgate Sheri Thomas/HOU/ECT@ECT Brenda F Herod/ENRON@enronXgate cc: Sally Beck/HOU/ECT@ECT Georgeanne Hodges/ENRON@enronXgate Vanessa Schulte/ENRON@enronXgate Bob M Hall/NA/Enron@Enron Leslie Reeves/HOU/ECT@ECT Brent A Price/ENRON@enronXgate Subject: Confidential Folder to safely pass information to Arthur Andersen We have become increasingly concerned about confidential information (dpr/position info curves validations/stress tests etc) being passed to Arthur Andersen for audit purposes over the Web to their Arthur Andersen email addresses. (necessary now they no longer have access to Enron's internal email system) Please use the folder described below when passing any info (that you would have concerns about if it was picked up by a third party) via the shared drive that has been set up for this specific purpose. Note: AA should also use the shared drive to pass info back if there are questions or the data needs updating. We should also consider the sensitivity of audit findings and special presentations if they are being distributed electronically. Please pass this note to others in your groups who have the need to pass info back and forth. Details on how to access for those who will use this method to pass info: A secured folder has been set up on the o drive under Corporate called Arthur_Andersen Please post all confidential files in this folder rather than emailing the files to their company email address. If you need access to this folder submit an eRequest through the IT Central site: Arthur Andersen will be able to retrieve these files for review with their terminal server access at the Three Allen Center location. Please contact Vanessa Schulte if you have any problems or questions Beth Apollo What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Price Cap Media--DRAFT Body:: I agree that we need to add our customer contacts to the list. This gives them a great opportunity to look smart -- we went to the market and got price protection. On the messages we need to include Mark's top three: 1) price caps cause shortages (Rob Bradley: let's put some historical examples together) Mona L Petrochko 07/18/2000 01:26 PM To: Jeff Dasovich/SFO/EES@EES cc: James D Steffes/HOU/EES@EES Steven J Kean/HOU/EES@EES Mark Palmer@EES Richard Shapiro/HOU/EES@EES Paul Kaufman@EES Peggy Mahoney/HOU/EES@EES Karen Denne/Corp/Enron@Enron Jeff Brown/HOU/EES@EES Susan J Mara/SFO/EES@EES Sandra McCubbin/SFO/EES@EES Subject: Re: Price Cap Media--DRAFT I have a couple of suggestions on parts of the draft. Media Action: In addition to doing behind the scenes editorial board meetings and the like I would suggest that we get our coalition lined up and ready to release statements for certain key events which are likely to occur over the next several weeks such as: 1. SDG&E's selection of the winning bid to their RFP. Even if Enron isn't selected as the winning bid the coalition should trumpet the market-based solution and the enormous market response to SDG&E's RFP. 2. The Commission vote on UCAN's Emergency Motion. We should be prepared to issue a statement whether the Cmmn votes with us or against us. With us the market can and did provide reasonable expedient solutions to SDG&E's customers and protection from price spikes. Against us despite the overwhelming market response the Cmmn chose to ignore the market solutions and impose more regulation. 3. Potential for ARM members to surface a Provider of Last Resort proposal within the next couple of weeks. 4. ISO Bd. Mtg-keep up pressure against reducing price caps. Coalition Members: Agree that those groups listed should be contacted although the CMA CRA CIU CLECA have been luke-warm in their advocacy. I would add our customers (UC/CSU (especially the San Diego branch) PacTel etc.) NewEnergy has indicated that Kroger/Ralph's grocery stores San Diego-based would give testimonials. I could solicit the members of ARM to identify a key customer contacts for interviews. We could check with our lobbyists and see who they would recommend (wine growers dairy industry etc.) We should also consider the water agencies and the rural counties and the City of Pittsburg. While the immediate message is responding to San Diego's situation this latter group of potential coalition members would go to the larger message (keeping benefits of competitive markets) from a state-wide perspective. What about the City of Pittsburg? Jeff Dasovich on 07/18/2000 10:07:00 AM To: James D Steffes/HOU/EES@EES Steve Kean Mark Palmer Richard Shapiro/HOU/EES@EES Paul Kaufman@EES Peggy Mahoney/HOU/EES@EES Karen Denne/Corp/Enron@Enron Jeff Brown/HOU/EES@EES Mona L Petrochko/SFO/EES@EES Susan J Mara/SFO/EES@EES Sandra McCubbin/SFO/EES@EES cc: Subject: Price Cap Media--DRAFT Here's a draft. Given sense of urgency I tried to develop a target for folks to shoot at rather than The Perfect One-pager. So please fire at will. In particular need PR to fill in Media Approaches and Key Message Points. Best Jeff What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: http://www.ssrn.com/ What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: May 15 conference Body:: Joe -- could you see if someone at FERC -- Hebert or Madden might be available -- or suggest a suitable alternative? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: You probably saw the announcement that Mike Mcconnell is now CEO of Enron Global Markets. EGM will be focussing on a number of new and existing markets (including coal LNG crude and products interest rates agricultural commodities equities weather etc). One of the markets Mike's group is actively considering is transport capacity. I mentioned your work in the area. He is anxious to see it and meet with you after he has had a chance to review it. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Report on Calif. Electricity Price Spikes by CPUC and EOB Body:: As we discussed. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Privileged and Confidential Communication to my Attorney Body:: Hoyt If GSP LLC would assume the liability at the time of return why would it risk bringing them back for light duty work? Why not wait until they are fully released particularly if one of them is going to sue under workers comp scheme? Also Hoyt you need to be careful about revealing conversations with GSP counsel to MG -- I noticed you had cc'd someone from Media General in the prior email. We don't want to waive any privileges. Michelle HThomas@gspcorp.com on 11/15/2000 06:10:00 PM To: peter.del.vecchio@enron.com david.howe@enron.com cc: michelle.cash@enron.com LFaucheaux@media-general.com MParker@gspcorp.com Subject: Privileged and Confidential Communication to my Attorney Peter we have two long-term worker's comp cases whose accidents happened before Enron bought GSP. We would like to bring them back to do light-duty work to get them in the swing of working again and also to get some adminstrative work done. I am concerned that bringing these employees back to work on light duty will cause these cases to become an Enron liability rather than an MG liability. I discussed this with Pat McCarthy the labor and employment law attorney we are using in NJ and he said that the liability would typically not transfer to GSP just because we brought them back . . . it would still be an MG liability UNLESS THE EMPLOYEE HURT HIMSELF AGAIN. In which case GSP owns it. However Pat said that a lot of what determines the ownership of the worker's comp cases is written into the purchase and sale agreement. He said that there may be language that addresses an employee's return to work from worker's comp. I know that we have an ongoing dispute about worker's comp with MG at this point. What would be your recommendation on bringing these employees back to work? As a bit of additional info one of the two employees seems eager to come back . . . the other one does not. An employee told me that the second employee actually has a lawsuit filed against MG/old GSP about his injury. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: House Energy Committee Passes First Energy Package Body:: Late this morning the House Energy and Commerce Committee adoped the committee print as amended of an energy package that addresses conservation clean coal renewables hydro nuclear and boutique fuels. The vote was 50 to 5 to report the bill. Other committees -- Ways and Means Science and Resources -- also moved their energy bills this week. Thus the House is on track to consider a merged package before the start of the August Recess on August 3rd. As to electricity during the several days of debate this week both Chairmen Tauzin and Barton reaffirmed their intention to next move to electricity issues. Mr. Barton's staff advised me this morning that the subcommittee he chairs will hold a hearing on Friday July 20th on all electricity issues other than transmission. While Mr. Barton has publicly held out hope of marking up an electricity bill this month sources on and off the committee do not see this timetable as realistic. On the Senate side the majority staff is working on an electricity white paper that may be circulated for comment next week. Below is a recap of action on amendments of interest to Enron: 1. Last night on a largely partisan vote (with Democrats Hall Green and John voting with the Republicans) the Committee rejected an amendment by Rep. Jane Harman (D-CA) (that was to have been offered by Rep. Anna Eshoo (D-CA)) that would have retroactively amended the FERC refund date and essentially ordered refunds regardless of amounts owed to power sellers. 2. First thing this morning the Committee again on a largely partisan basis (with Democrats Hall Green John and Towns) rejected a Waxman amendment to impose cost-of-service rates on all power in the West (other than generation added after 1/1/01). (Originally Mr. Waxman was going to offer amendment to impose cost-of-service rates only on those who do not supply all available power during an emergency but he ended up offering basically what he had pursued in subcommittee on the old Californa Only bill.) 3. The Committee adopted an amendment by Rep. Shadegg to amend the Natural Gas Act to make it clear that a natural gas transportation facility shall not be added to the National Register of Historic Places until FERC has abandoned the facility. Apparently there have been some instances of old pipelines being considered as historic places under federal law. The House Resources Committee added a similar amendment to its package yesterday. 4. By voice vote the Committee rejected a Waxman Amendment to require the president to propose and implement a plan to bring U.S. greenhouse gases down to 1990 levels. There was strong opposition voiced by many Republicans and Democrats to this amendment. 5. By mixed vote of 24 to 29 the Committee defeated a Waxman Amendment to set cost and performance goals for renewables including wind power and authorize federal funds to assist with commercial project costs (up to 50 percent). What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Restructuring (Confidential Communications) Body:: At the right time it would be helpful to discuss what we may want to consider as Core Assets (unrelated to trading activities) for purposes of emerging from bankruptcy as a going concern. As you know we are in the process of organizing and formatting in an asset matrix the assets/businesses we currently own (or otherwise have an interest in) that may be potentially for sale separating out potential core assets will be instructive as part of this process. Please let me know your thoughts/suggestions over the next few weeks. Thanks. Jordan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FERC Presentation on California/West Wholesale Market Body:: Per our discussion What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Wolaks report Body:: Joe Attached find the report you requested. Alan - Governor Davis offered a highly discounted forward contract ($45-50/MWh) at the FERC settlement conference today. As usual California is trying to get its refund with or without FERC requiring it. Alan - Tim and Joe will likely need your assistance with this settlement negotiation. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Nov. 13 UC summit conference on electricity Body:: I've got a few too many speeches coming up. You are probably in the best position to address this crowd (time for the student to teach the teacher) but I'd understand if you think it would be awkward (the we should just decline). Jeff Dasovich 10/05/2000 01:23 PM To: Tim Belden/HOU/ECT@ECT skean@enron.com cc: Subject: Re: Nov. 13 UC summit conference on electricity Steve: Let me know if you'd like to discuss. I like Tim's idea re: maybe you should take the slot. But in my view definitely not Skilling. I think you saw my thoughts about this conference in a previous email exchange with Schroeder re: Littlechild. Also they're breaking my arms and legs about sponsoring ($3-5K range). I had a thought that maybe EBS could stream the conference as an in-kind contribution---the PR that EBS gets out of streaming might outweigh the cost of providing gratis. I had only raised it as a thought though and am surprised to see it turn up in print. Tim and I had both had Lee as a professor and I've been talking him about this conference alot and have no problem delivering whatever the news is. In fact I had already told them that they shouldn't count on us for this one but that we're always interested in working together. Best Jeff Tim Belden@ECT 10/05/2000 01:00 PM To: Jeff Dasovich/NA/Enron@Enron Steven J Kean/NA/Enron@Enron cc: Subject: Nov. 13 UC summit conference on electricity Jeff I sent this e-mail to Kean last night. I am fine with your recommendation for Skilling to pass on this event. Do you want to deliver the news to Lee. Do we want to offer you Steve Kean or me as an alternative? Personally I would like to attend but don't have much interest in speaking (assuming that they would allow low lifes like you or me to speak). Your call on all of this. Call bob Badeer with questions about the BEEP as I am heading out of town in a couple of hours. Tim: I've worked hard with these guys to try to make this conference the best that it could be but it ain't quite there. So I'd rather keep our powder dry and use Skilling at another time. Not top-shelf enough in my view. If you want to discuss further let me know. Also one question: Is the BEEP stack the constrained supply curve post-adjustment bids? I have that right? ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: organizational announcement Body:: I talked with Ken yesterday. He would like to keep David on until May 15 to finish up some things he is working on for Ken. Enron Capital & Trade Resources Corp. From: Sherri Sera 04/09/2001 08:45 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Re: organizational announcement Just out of curiosity did this ever get resolved? Apologies if I'm being too bold! SRS From: Steven J Kean on 03/14/2001 07:33 AM To: Sherri Sera/Corp/Enron@ENRON cc: Subject: Re: organizational announcement Ken was meeting with him the day before yesterday. I'm just waiting to hear back. Sherri Sera 03/13/2001 10:07 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: organizational announcement Just saw the memo about Sanjay Diomedes and Jim. Guess David Haug is still around? SRS What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Senate passes Alper/Davis Bill 30-0 Body:: what does the siting bill provide for? Mona L Petrochko@EES 08/29/2000 04:38 PM To: Douglas Condon/SFO/EES@EES Martin Wenzel/SFO/HOU/EES@EES James M Wood/HOU/EES@EES Dennis Benevides/HOU/EES@EES Greg Cordell Roger Yang Edward Hamb/HOU/EES@EES Peggy Mahoney/HOU/EES@EES Karen Denne@Enron Mark Palmer/Corp/Enron@ENRON cc: James D Steffes/HOU/EES@EES West GA Richard Shapiro/HOU/EES@EES Steven J Kean/NA/Enron@Enron Mary Hain@Enron Subject: Senate passes Alper/Davis Bill 30-0 AB 265 passed through the Senate a few minutes ago. It now must go to the Assembly where there is still a lot of uncertainty about what changes the Assembly will want to the bill. We still haven't seen the latest republican language. Also AB 265 is double joined to AB 970 controversial siting bill. To the extent one or the other fails they both fail. AB 265 (Davis/Alpert) has: 1. a 6.5 cent/kWh energy rate cap through 2002 with potential extension through 2003. 2. Applicable to residential small commercial (up to 100 kW) 3. Opt-in provision for large industrial/agricultural customers at 6.5 cents with an annual true-up 4. Use of revenues from utility generation assets (including PPA) to offset undercollections. 5. Reasonableness review for San Diego G&E Will update with more information as available. No news about SCE. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: US Visit for GoodCorporation Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Special Comp Committee Meeting Notice - May 1st Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Barton Bill Body:: Thanks for the explanation. I agree though I may not have explained the context adequately to Ken. Linda Robertson 05/11/2001 04:32 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Barton Bill You seemed troubled by the call to Barton. This bill may or may not be subsumed by the comprehensive energy bill that Congress undertakes this summer. Both bills have a very difficult if not nearly impossible path ahead given that the Democrats are in no mood for compromise. The call to Barton was to: a) repair relationships (and with the Wall Street Journal calling Barton about his troubled past with Enron repair is needed) b) proclaim victory even of a limited nature (something I think Enron has not done much of) c) build a further bond with Barton so we would have more input at full Committee (something we will need given the chances that this will go off the track are real) and d) allow Enron to get significant credit for the defeat of price caps. I hear from lots of DC sources that we have not had any success in the House Energy and Commerce Committee. Numerous folks at the markup noted in private conversations that this was Enron's first real role in the Committee. Thus even though this is a very limited bill the call made sense. I do not think that this means we should call the White House to push the bill with them. The bill itself still has lots of obstacles and many potential threats ahead. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: IEP News 5/29 Body:: Today's IEP news ... Los Angeles Times May 27 2001 Sunday Home Edition Page 7 615 words ????The State ?Who Let the Hot Dogs Out? Rhapsodic Lawmakers Legislature: ????Speaking frankly officials have used the wiener as an easily digestible ????metaphor for the state's energy crisis. JULIE TAMAKI MIGUEL BUSTILLO ????TIMES STAFF WRITERS SACRAMENTO (Quotes Smutny on behalf of IEP) The San Francisco Chronicle MAY 26 2001 SATURDAY FINAL EDITION NEWS ????Pg. A1 835 words Davis asks U.S. to limit firms' prices ???RATE SWINGS: ????Governor argues 2 generators manipulated market Lynda Gledhill Sacramento (Quotes ??????? ???Smutny on ?behalf of IEP) The Wall Street Journal Power Drain: The U.S. Energy Crisis California Officials Say State Will ?? ???Enter A Recession Without Energy Price Caps By JOHN R. EMSHWILLER Staff Reporter of THE ?? ???WALL STREET JOURNAL AP Online May 29 2001 Tuesday 9:11 AM Eastern Time Domestic ????non-Washington general news item 770 words AP Top News at 9:10 a.m. EDT ????Tuesday May 29 2001 JEROME MINERVA The Dallas Morning News May 29 2001 Tuesday DOMESTIC NEWS K7523 1046 ????words Bush begins visit in hostile California By G. Robert Hillman Los Angeles Times May 29 2001 Tuesday Home Edition Page 1 1178 words ????Governor to Stress Price Caps to Bush Power: In a meeting today with the ????president Davis will present a letter from economists backing cost controls ????and demand federal assistance. DAN MORAIN JAMES GERSTENZANG TIMES STAFF ????WRITERS Los Angeles Times May 29 2001 Tuesday Home Edition Page 1 1541 words ????THE ENERGY CRISIS Kern County Basks in Role as State's Blackout-Buster ????Electricity: Six new plants will bolster its status as energy center. ????MITCHELL LANDSBERG TIMES STAFF WRITER McKITTRICK Calif. The New York Times May 29 2001 Tuesday Late Edition - Final Section A ????Page 12 Column 1 National Desk 1078 words For Crucial California Trip ????Bush Calibrates How Best to Handle State's Energy Crisis By DAVID E. SANGER ???? LOS ANGELES May 28 The Orange County Register May 29 2001 Tuesday DOMESTIC NEWS K7500 ????825 words California's power crisis generating lots of heat By John Howard The San Francisco Chronicle MAY 29 2001 TUESDAY FINAL EDITION NEWS ????Pg. A1 1291 words Crisis no sweat to some offices ???Many offices keep ????cool in crisis ???Air conditioners blast in state's energy centers Steve ????Rubenstein The San Francisco Chronicle MAY 29 2001 TUESDAY FINAL EDITION NEWS ????Pg. A1 1238 words Bush facing Davis' heat over energy ???In first visit ????to state as president he'll hear governor's plea for help Carla Marinucci ????Lynda Gledhill USA TODAY May 29 2001 Tuesday FIRST EDITION NEWS Pg. 3A 426 words ????Davis to urge Bush to back electricity price cap Laurence McQuillan LOS ????ANGELES The Washington Post May 29 2001 Tuesday Final Edition A SECTION Pg. ????A02 639 words Energy Chief Moves To Aid California Transmission Plan ????Precedes Bush Visit Mike Allen Washington Post Staff Writer LOS ANGELES ????May 28 The Washington Post May 29 2001 Tuesday Final Edition A SECTION Pg. ????A03 1936 words It's Still Dawn for Solar Power in L.A. Despite City ????Subsidies Homeowners Hesitate to Install Expensive Alternative Energy ????Source William Booth Washington Post Staff Writer LOS ANGELES The Washington Times May 29 2001 Tuesday Final Edition PART A NATION ????INSIDE POLITICS Pg. A6 1264 words Greg Pierce THE WASHINGTON TIMES The Washington Times May 29 2001 Tuesday Final Edition PART A NATION ????Pg. A4 809 words Bush faces tough sell on visit to California ?Davis ????likely to be rebuffed on price caps Joseph Curl THE WASHINGTON TIMES LOS ????ANGELES Chicago Tribune May 29 2001 Tuesday NORTH SPORTS FINAL EDITION News ????Pg. 6 ZONE: N 514 words Bush backs WW II project From Tribune news ????services. LOS ANGELES The Associated Press May 29 2001 Tuesday BC cycle 7:55 AM Eastern Time ???? Domestic News 604 words Bush announcing low-income aid but no price ????caps By SCOTT LINDLAW Associated Press Writer LOS ANGELES The Associated Press State & Local Wire May 29 2001 Tuesday BC cycle ????7:31 AM Eastern Time State and Regional 594 words Stakes are high for ????Davis meeting with Bush By GARY GENTILE AP Business Writer LOS ANGELES ABC NEWS WORLD NEWS NOW (2:00 AM ET) May 28 2001 Monday 447 words ????PRESIDENT BUSH VISITS CALIFORNIA WHERE POLITICIANS ARE CRITICAL OF HIS LACK ????OF ACTION FOR THEIR ENERGY CRISIS DEREK McGINTY JOSH GERSTEIN Los Angeles Times May 27 2001 Sunday ?Home Edition SECTION: California Part 2 Page 7 Metro Desk LENGTH: 615 words HEADLINE: The State Who Let the Hot Dogs Out? Rhapsodic Lawmakers Legislature: Speaking frankly officials have used the wiener as an easily digestible metaphor for the state's energy crisis. BYLINE: JULIE TAMAKI MIGUEL BUSTILLO TIMES STAFF WRITERS DATELINE: SACRAMENTO BODY: ??Every crisis has its symbol. ??Watergate had Deep Throat. The S&L scandal had Charles Keating. O.J. did--or didn't--have a bloody glove. ??Here in the Capitol the hot dog has become an unlikely metaphor for the state's energy crisis. ??In packed news conferences and heated Assembly floor debates lawmakers from both parties have evoked images of the ordinary dog to help explain an extraordinary mess. ??The genesis of this statehouse trend is difficult to determine. Assemblyman Fred Keeley appears to be the first to have tossed the hot dog into the political fire. ??During a crucial Assembly discussion in January the Boulder Creek Democrat recited the lyrics to a familiar Oscar Mayer jingle as a way of admitting that a controversial bill to have the state buy electricity to avoid blackouts was unpalatable but necessary. ??It's the dog kids love to bite said Keeley of the jingle. Well this is the bill people love to hate. ??A bizarre partisan hot dog duel ensued. Assemblyman John Campbell (R-Irvine) responded by likening the unpredictable financial consequences of the Keeley legislation to biting recklessly into mystery meat. ??Before I bite into it I see what's on the outside but I can't see the inside Campbell said. If nobody can tell me what's on the inside it may be bitter it may be bad it may make me sick. ??Assemblywoman Carole Migden (D-San Francisco) angrily fired back wanting to know why Campbell a professed hot dog eater was suddenly so critical of its unknown contents. ??It's OK to eat a hot dog that's full of animal bones and hair Migden said. That's a hot dog that's OK with you but this kind of hot dog isn't. ??Yet it was Senate leader John Burton who made it the key ingredient in a Capitol catch phrase. ??Burton described a plan to purchase the electrical power grid from the state's private utilities as a fair swap saying: I give you a dollar you give me a hot dog. ??The sound-bite quickly took on a life of its own. With the cost of the energy crisis growing faster than the price of ballpark franks critics doubted the public's appetite for a multibillion-dollar hot dog. ??Do you really want a hot dog? That is the question said Jan Smutny-Jones executive director of the Independent Energy Producers a trade group for power generators. ??Not content to let a dog lie in its bun lawmakers such as Assemblyman Bill Leonard (R-San Bernardino) kept the hot dog in public discourse. ??When Pacific Gas & Electric Co. filed for bankruptcy protection Leonard was one of a chorus of legislators who questioned the merits of purchasing the remaining portion of the power lines calling it not even half a hot dog. ??Added Assemblyman Bill Campbell (R-Villa Park): It's like paying Mercedes prices for a broken down hot dog cart. ??In recent weeks the hot dog rhetoric appeared to have gone cold. Then Assemblyman Juan Vargas (D-San Diego) revived it. ??After enduring hours of testimony on details of the deal to purchase Edison's power lines Vargas said his opinion of the dollar-equals-hot-dog deal had diminished. ??They're trying to charge us for a hot dog Vargas said of the utility but it looks like we're only going to be getting a wienie. ??Reliant Vice President John Stout also recently weighed in with his own hot dog analogy as he tried to explain why his company's income had jumped so much during the crisis. ??If you have a hot dog stand and you go out and buy five to six more hot dog stands Stout said referring to his company's purchase of power plants then naturally you would expect the operating income to go up. ??Alas the dog days of summer have yet to begin. LOAD-DATE: May 27 2001 of 4 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????MAY 26 2001 SATURDAY FINAL EDITION SECTION: NEWS Pg. A1 LENGTH: 835 words HEADLINE: Davis asks U.S. to limit firms' prices RATE SWINGS: Governor argues 2 generators manipulated market SOURCE: Chronicle Sacramento Bureau BYLINE: Lynda Gledhill DATELINE: Sacramento BODY: Gov. Gray Davis pursued a new strategy yesterday to control wholesale electricity costs by demanding that federal regulators ban two generators from selling power in California at market rates arguing that they have manipulated the market to their advantage. ???Meanwhile the Davis administration lambasted a federal plan to implement temporary price controls scheduled to go into effect Tuesday. State officials said the measures would do nothing to tame California's out-of-control costs for electricity. ???Davis whose calls for broader price limits on wholesale electricity have been rejected repeatedly by the Federal Energy Regulatory Commission is scheduled to meet with President Bush next week to ask Washington to do more to help California. ???Federal regulators said that prices were 'unjust and unreasonable' nearly nine months ago but they have been AWOL ever since Davis said in a statement. ???The California Independent System Operator managers of the state's electrical grid asked energy regulators yesterday to revoke the authority they have given Williams Energy and AES Inc. to sell power at market-based rates. Instead the Davis administration wants the companies to be forced to sell at cost-plus rates which would ensure a reasonable but limited profit. ???Market-based rate authority is not an entitlement the ISO said in a filing with federal regulators. ???The ISO asked regulators to act by June 15 saying that any delay places California consumers and the state's economy at extreme peril. ???Similar filings against other companies such as Mirant Duke and Reliant are being considered said Charles Robinson general counsel for the ISO. ???Robinson said the ISO has a well developed record of price manipulation by the two companies. He said information previously given to federal regulators proved the prices charged to California were excessive. ???'GRANDSTANDING' ACCUSATION ???Aaron Thomas a spokesman for Virginia-based AES said the administration is grandstanding. ???This is akin to the rhetoric the governor has used for the past several months he said. We are well below the index FERC uses to establish concerns about market power. ???As to this rhetoric about these companies abusing the marketplace -- check the facts. We lost money last year Thomas said. ???A spokeswoman for Williams said the company would not comment because it had not seen the filing. ???Earlier this month Oklahoma-based Williams agreed to pay $8 million to settle charges with FERC that the company was purposely withholding electricity from California's power market. The company admitted no wrongdoing and officials said a full hearing would have cleared the company. ???If the regulatory commission denies the state's requests or doesn't act in the time frame we believe is necessary to prevent harm the state can appeal to a circuit court Robinson said. ???BUSH VISIT POSTURING CHARGE ???Jan Smutny-Jones head of the Independent Energy Producers Association said the move is posturing by Davis ahead of Bush's visit. ???This is an interesting welcome mat for President Bush he said. Do we want a dialogue or a diatribe? ???In advance of Bush's visit Vice President Dick Cheney said yesterday that nothing more can be done to help solve California's power problems this summer. ???He also rejected price controls saying that previous efforts have contributed to a supply shortage. ???A spokesman for Davis rejected that notion and denied that the timing of yesterday's announcements were connected to the Bush-Davis meeting. ???Davis aides expressed hope that Bush's two new FERC commissioners Pat Wood III a close Bush ally expected to take over the chairmanship of the board and Nora Mead Brownell a state utility regulator in Pennsylvania would hear California's pleas. The two new commissioners were confirmed yesterday by the U.S. Senate. ???Among the things Davis wants changed is the regulatory commission temporary price relief plan scheduled to take effect Tuesday. ???The regulators would limit wholesale prices during power alerts in California when reserves drop below 7 percent of available capacity. ???Many state officials believe that doesn't go far enough. The state Assembly in documents to be filed Tuesday said price controls should cover all hours -- not just power emergencies. ???And there is a chance the controls will be in effect for just a few days. Under the regulatory commission plan the state and the three investor-owned utilities must file a proposal to join a regional transmission organization by June 1. If they do not to do so the price controls disappear. ???Davis administration officials expect to file another response dealing with the regional transmission organization by Friday Robinson said. The Assembly filing rejects joining such an organization which federal officials favor as a means to better manage and improve grid capacity in the West. E-mail Lynda Gledhill at lgledhill@sfchronicle.com. GRAPHIC: PHOTO Vice President Dick Cheney said nothing more can be done to help solve California's power problems. / New York Times LOAD-DATE: May 26 2001 May 29 2001 Power Drain: The U.S. Energy Crisis California Officials Say State Will Enter A Recession Without Energy Price Caps By JOHN R. EMSHWILLER Staff Reporter of THE WALL STREET JOURNAL On the eve of a meeting Tuesday between President George Bush and California Gov. Gray Davis top advisers to the governor said the state could be pushed into recession unless the federal government imposes temporary price caps to contain soaring wholesale electricity costs. President Bush has consistently opposed price caps. The governor's team called a Memorial Day news conference to highlight what they saw as the dangers to the economy of the state and possibly the nation from the tens of billions of dollars being spent this year to purchase electricity. The governor's aides estimated that statewide wholesale electricity purchases this year could hit $50 billion compared with about $7 billion in 1999. Some estimates for this year's power expenditures are even higher. If California were a separate nation an energy shock of that magnitude would be expected to cause a significant recession said Alan Blinder a former vice chairman of the Federal Reserve at the conference. While being part of a broader national economy could somewhat mitigate the impact the higher power costs are a recipe for stagflation in California added Mr. Blinder. Stagflation refers to stagnant economic conditions and inflation -- a condition that struck the nation when energy prices soared in the 1970s. Though the advisers painted perhaps the dreariest outlook yet to come from the governor's office they said that the Davis plan for financing the state's electricity purchases remains intact. As reported the state plans to sell about $12.5 billion in bonds later this year. The state has been purchasing electricity since January when its failed utility-deregulation plan left California's two biggest utilities financially unable to continue buying power. If price caps were instituted the state might have to borrow less money than anticipated or at least face a decreased danger of having to borrow more if the power situation gets worse said Joseph Fichera chief executive of New York-based Saber Partners LLC and an adviser to Mr. Davis. The governor plans to press his case for price caps over the next six to 18 months as supplies are increased with new power plants due to come into operation the advisers said. However Mr. Bush and other federal officials have repeatedly said that they believe price caps would be counterproductive and discourage the building of new power plants. Write to John R. Emshwiller at john.emshwiller@wsj.com1 Copyright 2001 Associated Press AP Online ?????????????????May 29 2001 Tuesday 9:11 AM Eastern Time SECTION: Domestic non-Washington general news item LENGTH: 770 words HEADLINE: ?AP Top News at 9:10 a.m. EDT Tuesday May 29 2001 BYLINE: JEROME MINERVA BODY: ??NATO Won't Back U.S. Missile Plan ??BUDAPEST Hungary (AP) ??NATO's top policy-making body stopped short of endorsing the Bush administration's plan for a national missile defense today preparing to offer only to ''continue substantive consultations'' with Washington. The North Atlantic Council does not portray the possibility of missile attack as a common threat faced by allies as the Bush administration had hoped it said in a statement. Secretary of State Colin Powell had hoped to persuade skeptical NATO allies to be more supportive of U.S. missile defense plans. ??Pakistan Accepts India Offer to Talk ??ISLAMABAD Pakistan (AP) ??Pakistani military ruler Gen. Pervez Musharraf today accepted India's offer to hold peace talks on the disputed Kashmir region and other issues. ''I accept your invitation ... to visit India with great pleasure'' Musharraf said in a letter to Indian Prime Minister Atal Bihari Vajpayee. ''We wish to see a stable prosperous India at peace with its neighbors.'' Musharraf's letter came four days after Vajpayee broke a two-year lull in high-level talks between the two rival nuclear powers by inviting the Pakistani leader to India. ??Consumers' Spending Incomes Rise ??WASHINGTON (AP) ??Consumers spent on services in April but cut back on cars and other big-ticket items. Incomes also rose. The Commerce Department reported today that consumer spending rose by 0.4 percent in April following a 0.2 percent increase the month before. April's rise marked the biggest increase since January. Consumer spending accounts for two-thirds of all economic activity and has been a main pillar propping up the country's fragile economy. Personal incomes rose 0.3 percent. ??Bush Won't Cap Electricity Prices ??LOS ANGELES (AP) ??President Bush says he won't force down soaring electricity prices that have cost California nearly $8 billion since January. The Republican president and embattled Democratic Gov. Gray Davis arranged a meeting today to talk about the state's energy crisis but there was no indication they would break their stalemate. Bush opposes price limits on wholesale electricity that utilities buy arguing they do nothing to address supply-and-demand issues at the heart of the crisis. ??Tornado Injures 18 in Colorado ??ELLICOTT Colo. (AP) ??Dozens of residents of a sparsely populated town in southern Colorado spent the night in a church after a tornado crushed trailer homes sprayed hail and injured 18 people. ''We just hit the floor in the living room and covered the kids and the tornado hit'' said Trish Davidson whose mobile home was lifted into the air and dropped 10 feet from its foundation. Davidson and about 30 other people spent last night in the basement of a church. Power was out to the church and much of the surrounding area. ??Israeli Motorist Killed ??JERUSALEM (AP) ??An Israeli motorist was killed in a West Bank drive-by shooting today as Israeli and Palestinian officials after two rounds of U.S. mediation spoke of resuming security talks aimed at reducing the violence. The motorist died of head wounds shortly after he was shot on by Palestinian gunmen from a passing car near the West Bank city of Nablus the army said. Two Israeli settlers were shot and injured one seriously in another West Bank ambush last night. ??Record-Breaking DJ Still on Air ??JERSEY CITY N.J. (AP) ??Now you can't get disc jockey Glenn Jones off the air. As of 6:30 a.m. EDT today the DJ had been talking for about 93 hours easily shattering the record for the longest continuous radio broadcast. And he was still talking. ''It's been a test of wills a test of determination'' Jones said. ''The first day was the hardest but we're still going strong.'' Jones said he wanted to remain on the air until he hit the 100-hour mark which would be about 1 p.m. EDT and would then decide whether to continue. ??Nikkei Adds 36 Points ??TOKYO (AP) ??Tokyo stocks rose moderately today in light trading following holidays in the United States and Britain. The Nikkei Stock Average gained 36.12 points to close at 13773.89. ??Agassi Capriati Open With Wins ??PARIS (AP) ??Andre Agassi and Jennifer Capriati began their bids for a second consecutive Grand Slam title winning in straight sets today on the second day of the French Open. Agassi who won the French Open in 1999 beat Sweden's Thomas Johansson 6-2 6-3 7-6 (5). Capriati seeded fourth overcame seven double faults in defeating France's Emilie Loit 6-2 7-5. Both Agassi and Capriati won Australian Open titles earlier this year. LOAD-DATE: May 29 2001 of 98 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service Dallas Morning News 29 2001 Tuesday SECTION: DOMESTIC NEWS KR-ACC-NO: ?K7523 LENGTH: 1046 words HEADLINE: Bush begins visit in hostile California BYLINE: By G. Robert Hillman BODY: ??LOS ANGELES _ President Bush landed in hostile territory Monday night beginning his first presidential visit to California amid a pressing energy crisis that he says he cannot ease in the short term. ??We welcome him to California said California Gov. Gray Davis a Democrat who has waged a long-distance war with the Republican president over the high cost and short supply of electricity in the nation's most populous state. ??I hope he has an opportunity to talk firsthand to some of the people who are adversely impacted by the very high rates we're paying for electricity. ??But the president's carefully scrubbed schedule for the next two days provides little time for such an opportunity although he will confer privately with business leaders to discuss high-tech solutions to the state's energy problems. ??Arriving on a cross-country flight that touched down in Arizona for a Memorial Day tribute Bush headed off to prepare for an early-morning stop Tuesday to promote energy conservation at the Marine Corps' Camp Pendleton and a luncheon address to the Los Angeles World Affairs Council. ??On Wednesday he'll visit Sequoia National Park near Fresno Calif. to launch a new drive to clean up and fix up national parks. ??He'll also meet privately Tuesday afternoon with Davis in what the Los Angeles Times characterized as a peace summit. But no major shifts in policy are expected. White House aides suggest that the meeting will be a success if the governor even temporarily tempers his sometimes-harsh words for the administration. ??The president's focus is going to be on solving problems. He's not interested in finger-pointing White House press secretary Ari Fleischer said. ??Whether people agree or disagree with the specifics of his energy plan I think most Americans and most Californians are very pleased to see a president who is leading and taking action in addressing the issue head on. ??However recent public opinion polls show the president and the governor taking hits for the energy crisis in California. ??The Field Poll finished a week ago found that 54 percent of those surveyed believed Bush had handled the energy problems poorly with Davis faring somewhat better at 38 percent. The margin of error for the 1015 California interviews was 3.2 percentage points. ??An earlier survey by the Public Policy Institute of California found Davis' job approval rating plummeting from 63 percent in January to 46 percent in May as the state's energy troubles escalated. Bush's overall approval rating was higher at 57 percent but still just as many of those surveyed gave him low marks for his handling of energy issues. That margin of error for 2001 interviews was 2 percentage points. ??In short political analyst Sherry Bebitch Jeffe said Bush's visit to the state _ in his 19th week as president after already visiting more than half the other states _ is long overdue. ??His not responding or not being perceived to respond to the short-term needs of California has allowed Davis' arguments to resonate _ that the federal government is uncaring is insensitive Jeffe said. ??In his national energy policy unveiled nearly two weeks ago Bush offered a series of mostly long-term recommendations to conserve energy find more of it and substantially upgrade and expand the nation's oil refineries and transmission systems for natural gas and electricity. ??Davis complaining that Texas energy companies in particular are gouging Californians has urged Bush to embrace price controls for wholesale electricity but the president has steadfastly refused. Vice President Dick Cheney who oversaw development of the White House energy policy emphasized as recently as Friday that there's no quick fix on the way for California. ??Long term the answer is to build more power plants and that's exactly what they're doing Cheney told the U.S. Chamber of Commerce. But they're not going to have enough new capacity online this summer to avoid blackouts. ??So the energy woes continue to fester in California. It's not just electricity and rolling blackouts. Gasoline prices of $2-and-more-a-gallon have become commonplace as well. ??The gas bothers me more than the electric said Tait Kmentt who runs a legal process serving business in Irvine Calif. Gas prices are killing me. ??At $2.25-a-gallon for premium gasoline he says it costs him more than $40 to fill up his new Mercedes _ with no relief in sight. ??A newcomer to the state Kmentt voted for Bush last fall and said he's glad the president is finally visiting California. But Kmentt cautioned This will be a big test to see how concerned he is. ??Kmentt said he understands the state's energy troubles are a huge problem that can't be fixed overnight and right now he's blaming the power companies for the high price of electricity. ??I just think the public is being lied to he said. ??Still this is not good news for Bush who has been increasingly portrayed by Democrats as a Texas oilman still beholden to the industry. California which he lost last fall to Al Gore by 12 percentage points has become increasingly a political headache. ??Where his predecessor Bill Clinton seemed politically and personally comfortable Bush is not suggests Jeffe a senior scholar in the School of Policy Planning and Development at the University of Southern California. ??An ego cannot be buoyed by losing the state by 12 points she said. We are the state that was responsible for giving Al Gore his popular vote victory. ??With the Senate now headed for Democratic control Jeffe said Bush's visit to California _ and others that will surely follow _ are essential to help Republicans hold their base in the House. ??If the energy crisis persists in California further punishing its economy the ripple effects will certainly spread she said. ??George Bush remembers the influence of the economy on the career of an incumbent president Jeffe said pointing to Bush's father who was defeated by Clinton during an economic slump in 1992. ??It took a while she said but people are beginning to get angry. ??(c) 2001 The Dallas Morning News. ??Visit The Dallas Morning News on the World Wide Web at http://www.dallasnews.com/ JOURNAL-CODE: DA LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 / Los Angeles Times Angeles Times ??????????????????????May 29 2001 Tuesday ?Home Edition SECTION: California Part 2 Page 1 Metro Desk LENGTH: 1178 words HEADLINE: Governor to Stress Price Caps to Bush Power: In a meeting today with the president Davis will present a letter from economists backing cost controls and demand federal assistance. BYLINE: DAN MORAIN JAMES GERSTENZANG TIMES STAFF WRITERS BODY: ??Gov. Gray Davis will present a letter to President Bush today from top economists advocating wholesale electricity price controls warning Monday that a failure by Bush to help California solve its energy crisis could signal to other regions that he may ignore their pleas. ??Bush making his first trip to California has set aside 20 minutes this afternoon to meet with Davis in Century City. In an interview with The Times the Democratic governor vowed to repeat his request that the federal government move to cap wholesale power prices. Failure to act swiftly threatens the state and national economy Davis said. ??I want him to understand Davis said that if California has to pay 700 times more for electricity in 2001 than it did just two years ago it could well drag our economy into a recession and could conceivably trigger a national recession. That is not good for anyone. ??In the letter 10 economists including Cornell professor emeritus Alfred Kahn a major proponent of airline deregulation told of their deep concern about the failure of the Federal Energy Regulatory Commission to stabilize wholesale electricity prices in California. The economists faxed the letter to the White House on Friday afternoon and provided the governor with a copy to present to Bush today. ??FERC's failure to act now will have dire consequences for the state of California and will set back potentially fatally the diffusion of competitive electricity markets across the country the economists led by Frank Wolak of Stanford University wrote. Moreover this negative experience with electricity restructuring could delay or reverse current efforts to introduce competition into other formerly regulated industries. ??Davis called the letter very significant validation of what we've been saying: The marketplace is not working and FERC has an obligation to act. ??We're not pleading for relief we're entitled to it Davis said. ??Bush and Vice President Dick Cheney repeatedly have said such controls never work. In California caps might worsen the situation by limiting supply they have argued resulting in more blackouts this summer when demand for electricity is highest. ??The Bush-Davis meeting has had all the buildup of the political equivalent of a title fight: On one side the Democratic governor of the nation's most populous state which Bush lost by more than 1 million votes in November. On the other the new president coming off a roller coaster week of political defeat (the shift in control of the Senate) and victory (passage of his tax-cut plan) whose work in the Texas oil industry gives him a special history in the topic at hand. ??From afar Davis has battled the Bush administration's energy policy. But said Dan Bartlett one of the president's chief communications advisors The president has some interesting views on this topic as well with some experience himself. ??Bush's Energy secretary Spencer Abraham took steps Monday to increase electricity transmission capacity in California. He ordered the Western Area Power Administration a division of the Energy Department that is responsible for marketing electricity from federal water projects in 15 Western states to finish its planning for extra transmission capacity. ??At issue is so-called Path 15 an 84-mile stretch of power lines with insufficient capacity to carry the necessary load between Southern California and the northern part of the state especially during peak hours. The central question is whether financing is available for a new transmission line. ??Davis lauded the action but said the president needs to do more. ??If I have any advice to him of a political nature it is take a chapter out of President Clinton's book. ?? [Clinton] was very attentive to California and as a result did better in 1996 than he did in '92. People felt he was here for us when we needed help. We need help. ??Davis said that on a recent trip to Chicago officials there worried that if Bush won't offer California some relief he may not offer us relief in a catastrophe. ??Among the facts and figures Davis intends to show the president is a chart showing that California paid $1.2 billion for electricity in the first quarter of 1999 $1.8 billion for the same period last year and as much as $10.3 billion for electricity in the first three months of this year--at a time when conservation efforts had been taking hold and demand was down. ??I hope the president will be as stunned as I am said Davis who is watching as the state spends more than $55 million a day to buy electricity that private utilities can no longer afford. ??Davis said that though he is trying to speed construction of power plants encourage conservation and return the private utilities to financial stability the federal government has control over wholesale power prices. ??Therein lies the final piece of this puzzle Davis said. If it falls into place we're on the way to putting this issue behind us. If it doesn't fall into place it could create real economic havoc here and across the country. ??Davis said that if Bush refuses to impose price controls he should find some way to help us consistent with his own belief. ??Turning a deaf ear not only won't be well received here Davis said. It likely won't be received well elsewhere. ??The state's energy crisis has posed a ticklish dilemma for Bush's busy travel schedulers: Had he visited earlier it would have been awkward not to focus on energy issues. But until 11 days ago when a task force led by Cheney produced energy proposals there would have been little Bush could say. ??Karen Hughes the president's counselor made it clear that regardless of the pressure Bush will not yield on price caps. ??We want to help. The president is very concerned about the energy situation and blackouts she said. But limiting the wholesale price of energy would only discourage its production Hughes said. ??California is the 30th state Bush has visited since taking office Jan. 20. His staff said the delay had to do not with energy issues but with politics and geography. ??With the administration focused in its first months on winning approval of the tax cut the president's travels were largely dictated by that effort his aides said. ??Besides the president confided recently even with Air Force One at the ready it just takes too long to fly from Washington to California. ??Still Hughes said the president is not ignoring California. Condoleezza Rice the president's national security advisor and a former Californian sits next to Hughes every morning at the daily meeting of the White House senior staff she said. ??What's more the president has many friends in California Hughes said adding: Ernie has a home in California these days. Ernie is the Bush family cat that is living with a friend in Brentwood while the First Family lives in the White House. ??* ??Times Staff Writer Massie Ritsch contributed to this story. LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 / Los Angeles Times Angeles Times ??????????????????????May 29 2001 Tuesday ?Home Edition SECTION: Part A Part 1 Page 1 Metro Desk LENGTH: 1541 words HEADLINE: THE ENERGY CRISIS Kern County Basks in Role as State's Blackout-Buster Electricity: Six new plants will bolster its status as energy center. BYLINE: MITCHELL LANDSBERG TIMES STAFF WRITER DATELINE: McKITTRICK Calif. BODY: ??You could think of this as California's own little slice of west Texas. ??Here in the scruffy brown hills of western Kern County oil rigs grow more easily than trees pickups are more common than cars and chicken fried steak is the most popular dish at Mike and Annie's McKittrick Hotel. ??The hotel--which no longer offers lodging just food and drink and plenty of it--is bustling these days with the roustabout energy of a Lone Star construction camp. Just down the road a mammoth electrical power plant is rising out of the sagebrush its generators housed in four boxy buildings the size of airplane hangars. ??It is one of six new major gas-fired power plants expected to be built in Kern County over the next several years an electrical construction boom unmatched anywhere in California. Kern which already has a large surplus of electricity is cementing its place as California's energy capital assuming far more than its share of the burden in recharging the state's drained power supplies. ??Over the next several years the county will add nearly 5000 megawatts of power to the statewide grid. That is more than California now imports on average from out-of-state suppliers. It's enough to supply about five counties the size of Kern which fills the dusty southern rim of the San Joaquin Valley and has a population of 662000. ??In some parts of the state a proposal to build a new power plant is a call to throw up the barricades. In recent months intense community opposition has forced developers to pull back proposals to build major plants in South Gate and San Jose although Gov. Gray Davis has tried to revive plans for the San Jose plant. ??You don't hear a lot of not-in-my-backyard talk in Kern County. ??There should be power plants in everybody's backyard said Paul Gipe chairman of the Kern chapter of the Sierra Club which did not oppose any of the new plants. If people are concerned about having too many power plants they should think twice when they flip on the light switch. ??New natural gas-fired power plants Gipe reasoned are relatively clean and will not add significantly to the county's serious air pollution problems. Ideally he said they will allow the state to close some older dirtier plants that cause considerably more environmental damage. ??If environmentalists don't oppose the plants it's not too much of a leap to guess that some people might be positively thrilled about them. ??Just try for instance asking somebody in Taft an oil center south of McKittrick. It's more money coming into Kern County--that's the way I look at it said Pamela Dunlap who runs a downtown thrift shop. ??An Economy Rooted in the Oil Industry ??She stood in the twilight outside her shop on a street that embodies many of the most attractive attributes of small town Americana--with one small difference. Where some towns might have statues of their founders or war heroes in prominent public places Taft has erected small oil rigs and other pieces of drilling machinery a reminder of its economic roots. ??That Kern County has stepped up as California's blackout-buster is perhaps not surprising. ??To begin with there's geography. Kern stands astride California's major north-south electrical transmission lines at precisely the spot at which they divide between the service areas of Pacific Gas & Electric which serves Northern California and Southern California Edison. That spot can be pinpointed as the Midway substation a vast jungle of humming wires transformers and circuit breakers that lies a short distance west of Interstate 5 in the town of Buttonwillow. ??Already massive new circuit-breakers--they look like Frankenstein helmets sprouting 5-foot-long sparkplugs--are being erected at Midway to handle the power from two major plants that will be revving up in the coming months: PG&E National Energy's La Paloma plant the one near McKittrick and Edison Mission Energy's Sunrise plant just south of Taft. ??The county is served by two major natural gas pipelines which will be tapped to run the plants. In fact Kern contains the state's largest known reservoirs of natural gas. ??Another of Kern's geographic advantages? ??You look around and you'll see there aren't a lot of people living around here observed Stephen Whaley who is overseeing construction of the Sunrise plant. In the surrounding hills an orchard of oil rigs bobbed in the morning haze. Dirt roads cut crudely across the landscape bisecting a crisscross of steam pipes fuel lines and electrical wires. ??This area is all about oil Whaley said. Casting a glance at the modular 560-megawatt plant rising behind him he added with a wry smile You know I guess you could look at this from the road and you could make the argument that it improves the looks. ??The Sunrise plant a relatively simple single-cycle plant is expected to fire up 320 megawatts of its total output by Aug. 1 a scant nine months after construction began. The other plants--more complex and efficient dual-cycle operations--will be opening over the next several years assuming all receive final approval. ??The lack of major opposition to the plants is of course another reason developers see Kern County as a good place to build. The county has long had a more intimate relationship with energy--oil gas electricity--than most places. To people here the link between a natural gas well and a lightbulb or an oil derrick and a gas pedal is neither theoretical nor especially threatening. They're comfortable with energy. ??Kern produces more crude oil than any other county in the United States outside Alaska. Property taxes from oil companies have helped build handsome new schools in Bakersfield the county seat and largest city. The companies' big payrolls have helped populate elegant subdivisions with names that sound vaguely Houstonian: Seven Oaks River Oaks Landmark Estates. ??Which brings us to the Texas connection. ??It's hard to overlook it in a county that runs on oil and cotton and boasts a country music scene to rival Austin's. Conversations in the finer Bakersfield restaurants are filled with references to trips to Texas of colleagues in Midland and Odessa. A Bakersfield radio station was running a contest recently: The winners would be flown to a bull riding championship in Houston. ??Until December 1999 American Airlines offered direct jet service between Bakersfield and Dallas. It stopped after Occidental Petroleum moved its headquarters from Bakersfield to Houston. ??This is a county where President Bush received more support in the November election than he did in Texas his home state. But then Bush already had a Bakersfield connection: He lived there briefly as a child when his father former President George Bush worked in the Kern oil fields. ??You look at the topography around Bakersfield and the county's morals and ethics--that predominantly conservative attitude that we have around here--and you look at the oil and you could be in Midland said John Allen the general manager of Occidental of Elk Hills which is developing a power plant in tandem with Sempra Energy of San Diego. ??A lot of people in Kern County will tell you they don't mind being an energy farm for the state. It's a living after all. ??It's good to be working at home said Joe Ryan a Bakersfield pipe welder who has spent years on the road seeking the heavy construction work that seemed to have vanished in his hometown. Now he's working at the La Paloma plant a 1048-megawatt behemoth that will come online in phases beginning in December. ??About 800 people are at work on the plant and several hundred more will be employed in the coming months. And after that plant is done there will be others to build. ??This is a good job here I tell you what said Ryan 47 who has been banking his overtime on six 10-hour days a week--sometimes more. ??County Sees Itself as 'Part of the Solution' ??But there are some signs of simmering resentment especially among county leadership. After all if every other county produced just half the electricity that Kern generates California wouldn't have an energy crisis. And people in Kern County are getting hit with the same spring-loaded electricity bills the same rolling blackouts as everybody else. ??I think the people of California are either going to be part of the solution or part of the problem said Assemblyman Roy Ashburn (R-Bakersfield). And in Kern County we have a long history of being part of the solution especially when it comes to energy issues. ??Elsewhere in the state Ashburn sees a lot of arrogance--people who enjoy the benefits of a very high quality of life enjoy the benefits of electric power for jobs and for their personal life but with an exclusivity that it's someone else's problem to create that for them. We don't have that attitude in Kern County. ??Power Buildup in Kern County ??Six new major gas-fired power plants are expected to be built in Kern County over the next several years making the county the power capital of the state. ??* ??RELATED STORY ??Letter to Bush: Gov. Davis will ask for wholesale energy price caps. B1 GRAPHIC: PHOTO: Tom Romesberg general manager of La Paloma plant being built in Kern County stands next to the unit's cooling tower. PHOTOGRAPHER: AL SEIB / Los Angeles Times PHOTO: From rigs and pipelines like these near Taft Kern pumps more crude oil than any other county in the U.S. outside Alaska. With several gas-fired power plants coming online in the next several years the county will solidify its place as California's energy capital. PHOTOGRAPHER: AL SEIB / Los Angeles Times GRAPHIC: Power Buildup in Kern County Los Angeles Times LOAD-DATE: May 29 2001 of 98 DOCUMENTS ??????????????????Copyright 2001 The New York Times Company New York Times ?????????????????May 29 2001 Tuesday Late Edition - Final SECTION: Section A Page 12 Column 1 National Desk LENGTH: 1078 words HEADLINE: For Crucial California Trip Bush Calibrates How Best to Handle State's Energy Crisis BYLINE: ?By DAVID E. SANGER DATELINE: LOS ANGELES May 28 BODY: ??Days after he suffered the biggest political setback of his four-month-old presidency and then won the tax cut that he staked his campaign upon President Bush traveled tonight to California carefully calibrating how to deal with the state's energy crisis. ??After Memorial Day celebrations in Washington and Mesa Ariz. Mr. Bush began his first visit as president to the most populous state which he lost by roughly 12 percentage points in November's election. The visit seems likely to showcase the clash between two very different energy strategies and political strategies. ???Mr. Bush will meet briefly on Tuesday with Gov. Gray Davis who will insist as he did again today that the federal government impose price caps on wholesale electric power. ??The White House says Mr. Bush will refuse again. He will argue that such caps would only discourage increased production of electric power. We think that's a mistake Vice President Dick Cheney said on Friday talking about why he rejected those options when he prepared the energy policy the administration made public 10 days ago. ??But Mr. Bush knows that how he handles the California energy crisis could prove critical to his political fortunes especially now that his party's loss of control in the Senate seems bound to slow or derail passage of major elements of his energy plan. ??Moreover the president can no longer argue that the best cure for high energy prices is a tax cut because that is now legislative history. As one of his aides said this weekend after Congress approved the $1.35 trillion tax cut that will be phased in over the next 10 years we will have to turn now to the other arguments. ??Most of those arguments involve urging the rest of the country not to follow California in a partial deregulation of the market with disastrous results. ??Repeatedly Mr. Bush has chastised California's politicians and by implication Mr. Davis himself for ignoring politically unpalatable choices to avert the state's power-generating crisis. Ten days ago standing in front of a hydroelectric plant in Pennsylvania Mr. Bush used the state as Exhibit A for his argument about what happens when population rises when over-regulation freezes the construction of new power plants and the stringing of new transmission lines and when politicians fail to plan for the long term. ??The problems in California shows that you cannot conserve your way to energy independence Mr. Bush said then. ??At the same time his aides were pointing to polls showing Mr. Davis's approval ratings plunging. They did not mention that Mr. Bush's ratings in the state were hardly any better. A series of recent polls show that roughly two-thirds of Californians believe Mr. Bush should be doing far more to help the state though it is unclear exactly what kind of help they have in mind. ??So Mr. Bush's aides have been struggling for days to choreograph the two-day visit here trying to find ways to differ with Mr. Davis without seeming callous about the problem or in conflict with the state. ??The betting is that Mr. Bush will focus on long-term solutions in contrast to Mr. Davis's call for the quicker fix of price caps. ??The effort started today. Energy Secretary Spencer Abraham issued an order of chiefly symbolic importance saying his department would move quickly to determine whether investors were interested in financing and co-owning a new transmission line that could bring more power to the state. ??The level of interest will be a factor in the decision to build the line later this year the Energy Department said. It said that it would proceed with studies of how the land could be acquired by eminent domain if necessary and that it would speed ahead with environmental reviews. ??But Mr. Abraham left wide open the question of whether Washington would go ahead with the project even if no private financing was available. ??The Bush administration is taking a leadership role in addressing a long-neglected problem in California's electricity transmission system Mr. Abraham said. California's electricity problems developed over a period of years and cannot be solved overnight. However we can move now on actions that will help avert the same types of problems from recurring year after year. ??The statement was clearly intended as a prelude to the meeting with Mr. Davis which will be closed to the press. So will a meeting with energy entrepreneurs. (Mr. Bush passed on Mr. Davis's suggestion of a forum with small-business owners and residents who have seen the lights go out.) ??Few expect Mr. Bush or Mr. Davis to change his mind about energy caps after their meeting. ??But for Mr. Bush it will not all be tough love. On Tuesday morning Mr. Bush is scheduled to travel to Camp Pendleton to repeat his call for the military and other federal users of power in California to flip off their switches whenever possible. But given his own comments and Mr. Cheney's about the limited utility of conservation that order could strike some Californians as a little hollow. ??Later he will give a trade speech in Los Angeles underscoring the message that if California hopes to remain the world's greatest exporter of high technology -- if it were a nation California would be the world's sixth-largest economy -- it must find new ways to produce and deliver electricity. ??Already leading Silicon Valley companies are threatening to build their next-generation chip fabrication plants elsewhere probably in Texas which has a surplus of generating capacity a move that would further undermine Mr. Davis's stewardship. ??In fact Mr. Bush's Texas roots will never be far from the political battlefield here. Mr. Davis has accused Texas energy companies of profiteering at California's expense. To press the case he has hired two political operatives from the Clinton White House Marc D. Fabiani and Chris Lehane who are being paid tens of thousands of dollars a month to make the case for price caps. ??California's attorney general Bill Lockyer also a Democrat suggested to The Wall Street Journal last week that some time in jail would be the best way to deal with one of Mr. Bush's biggest supporters -- Kenneth Lay who heads the Enron Corporation and has sought to influence the selection of members of the Federal Energy Regulatory Commission. ??The comments may have been partly facetious but they were not interpreted that way here. ??http://www.nytimes.com LOAD-DATE: May 29 2001 of 98 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ??????????????????????????The Orange County Register 29 2001 Tuesday SECTION: DOMESTIC NEWS KR-ACC-NO: ?K7500 LENGTH: 825 words HEADLINE: California's power crisis generating lots of heat BYLINE: By John Howard BODY: ??SACRAMENTO Calif. _ Detectives would seem to be tripping over each other to discover who did what to whom and why in California's energy crisis. ??While electricity may be scarce investigations are plentiful. A dozen major probes are afoot many overlap and more loom. The atmosphere is heated the rhetoric strong. State federal and local investigators along with court officers financial experts and special investigators are poring over thousands of pages of documents from government agencies and private companies. ??At the top of the swarming heap is the $10 million investigation mounted by the state Attorney General's Office to answer the core question: Did a handful of power sellers fix prices to bilk Californians of billions of dollars? ??But it's not just the government that is busy. The companies themselves _ which have categorically denied any wrongdoing _ are overwhelmed by the scrutiny. ??We are supplying reams and reams of documents. ... It is a distraction from our day-to-day work there's no question said Tom Williams of North Carolina-based Duke Energy which operates several power plants in California. It affects our employees and their families this barrage of innuendo. I don't know what more we can do. ??Accompanying the investigations are at least a half-dozen lawsuits against the companies by individuals. Like the probes the suits contend the companies improperly manipulated the market. Legislative leaders meanwhile have sued the federal government contending it has failed to protect consumers from price-gouging. ??This all permeates our business in so many ways said Gary Ackerman of the Western States Power Forum a group that represents power sellers and buyers in the West. It even affects my ability to talk to the newspapers because we're afraid statements may turn up later and be used as evidence. We're not sure what we're dealing with whether a suit or even a grand jury if the (attorney general) decides to take criminal action as he said he might. ??The state's top prosecutor said that indeed criminal charges are a possibility. ??There is an investigation under way that involves potential criminal conduct said Sandra Michioku a spokeswoman for Attorney General Bill Lockyer. It could be at least eight weeks before that probe is completed she said. ??Other investigating agencies include the Federal Energy Regulatory Commission the California Public Utilities Commission the city attorneys' offices in Long Beach Los Angeles and San Francisco California's grid manager the Independent System Operator the obscure Electricity Oversight Board which oversees the ISO and the state Senate and Assembly. ??The state has even considered asking two more federal agencies the Department of Energy and the Federal Trade Commission to get into the act. Some offices are conducting multiple investigations. In the case of at least two agencies the PUC and the Attorney General's Office the investigations are being at least partly coordinated. Some agencies are examining the same issues. The PUC the attorney general and ISO for example all are looking at whether power plants were shut down to drive up demand and prices. ??There is a lot of overlap and there probably are problems of coordination said Nettie Hoge of The Utility Reform Network of San Francisco a grass-roots watchdog group. ??With so many agencies trying to extract information Hoge said even those who have done no wrong are concerned about talking freely because of the greater likelihood that proprietary information will leak to competitors. ??Others feel the overlap is beneficial. ??When you're up against an industry as wealthy and powerful as the energy industry it's probably better to double-team them said Doug Heller of the Foundation for Taxpayer and Consumer Rights. ??Hoge believes that if any investigation is going to produce results it will be Lockyer's because the governor has thrown all the resources that way. ??Investigators have requested mountains of paperwork. Transaction and maintenance documents market reports financial records even e-mails _ all have been sought. ??Martin Wilson a spokesman for Texas-based Reliant contends the intensity of the probes could have negative long-term effect on California's business climate. ??There is a climate of instability and uncertainty that makes companies rethink their decisions about investments (in California) he said. ??But for consumer groups the goal of all these investigations is straightforward. ??Certainly we're really hopeful that these investigations will lead to refunds for customers said TURN's Mindy Spatz. There is a widespread belief among people who follow these issues that widespread gaming and manipulation has occurred in the market. ??(c) 2001 The Orange County Register (Santa Ana Calif.). ??Visit the Register on the World Wide Web at http://www.ocregister.com/ JOURNAL-CODE: OC LOAD-DATE: May 29 2001 of 98 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ?????????????????????MAY 29 2001 TUESDAY FINAL EDITION SECTION: NEWS Pg. A1 LENGTH: 1291 words HEADLINE: Crisis no sweat to some offices Many offices keep cool in crisis Air conditioners blast in state's energy centers SOURCE: Chronicle Staff Writer BYLINE: Steve Rubenstein BODY: Some very cool places to be during the dog days of spring and summer turn out to be the places with their fingers on California's air conditioning switch. ???If only the entire state could cram itself into the cavernous control room in Folsom of the Independent Systems Operator where the air is a comfortable 69 degrees and receptionists wear sweaters at high noon -- when it's upwards of 90 degrees outside. ???Or the Pacific Gas and Electric Co. lobby in downtown San Francisco where the air is an even chillier 65 degrees which admittedly isn't much of a bounty considering it's usually that cool outside anyway. ???Other cool places to be are the state Capitol where legislators who promulgate energy edicts hang out and the headquarters of the state Public Utilities Commission where bureaucrats who promulgate energy edicts hang out. ???Armed with a high-tech digital thermometer The Chronicle made the rounds of the energy crisis poohbahs to make sure they are practicing what they are preaching. ???Some were some weren't. Those that weren't blamed it all on that most familiar of modern scapegoats the computer. ???Computers must be kept cool -- in the 60s for big mainframes and a bit more for the smaller units most folks use though some can go into the 80s without hiccuping. So generally people who work alongside the computers get to keep cool by association although it's the computer that counts. ???The ISO headquarters located in an industrial park 20 miles east of Sacramento is a delightfully cool and comfortable place when the outside temperature soars into the 90s and 100s. ???The reception area the only room accessible to the outraged public is a fairly stiff 76 degrees -- only two degrees cooler than the 78 degrees recommended by President Bush and the federal energy crisis czars and czarinas. ???But take a step past the lobby security doors and the temperature plummets. In the main hallway the temperature is 73 degrees. And in the control room where two dozen engineers and technicians sit at consoles and monitor the flow of California electricity on a giant diagram of state power lines so they can order blackouts for everyone else -- the temperature is 69 degrees. ???NO SWEATING AT ISO ???Some managers do not take off their sports coats and jackets. ???We want these people to be comfortable explained Tony Capasso facilities manager for the ISO complex. We don't want these people sweating bullets in the middle of a crisis. ???Inside the state Capitol where legislators and the governor preach compliance with federal guidelines calling for 78-degree thermostats the temperature dips into the high 60s. The coolest spots are the press briefing room and the treasurer's old office. ???GOVERNOR'S OFFICE ???The governor's suite is in the mid-70s apparently because folks are often coming by with thermometers and it wouldn't do not to set an example. Press secretary Steve Maviglio said Governor Gray Davis is a practice-what-he-preaches kind of guy who keeps corridors dark shades drawn air conditioners idle. His personal secretary works in short sleeves with a cheap plastic fan humming nearby. ???It's so dark in the hall that we're always bumping into things said one aide. ???Even so the temperature in the governor's suite of offices is three degrees cooler than the 78 degrees recommended by President Bush -- not the first time the two men have failed to agree. ???THE LEGISLATURE ???The Assembly chamber is 71 degrees while the Senate chamber -- with 40 fewer legislators spewing forth -- is 73 degrees. But the Senate chamber has a southern exposure one Capitol guide explained. ???Hot air from the people sitting inside has nothing to do with it he said. ???In San Francisco the temperature inside cavernous City Hall dips in spots to the mid-60s. College student Jasmine Westbrook who dropped by with her art class on a project to sketch the interior of the building was doing her sketching while wearing a windbreaker to keep warm. ???I want to stay comfortable she said. It think it's supposed to be hotter in here isn't it? ???The mayor's office at 73 degrees was eight degrees warmer than another office down the hall even without the mayor sitting in it. ???63 AT THE PUC ???At the headquarters of the state Public Utilities Commission which is supposed to be keeping an eye on the self-declared bankruptcy of the utility that mails out the bills the lobby temperature is 63 degrees. ???Chief engineer David Omosheyin eyeing The Chronicle's thermometer nervously insisted the 63-degree reading was caused by the lobby's proximity to the front door where the outside temperature at the moment was in the low 60s. He invited the thermometer to visit the upper floors where the temperature was 70. ???As for San Francisco's federal buildings: Bush would probably not frown. ???His orders appeared to be followed during The Chronicle's visits so much so that it was actually hotter inside than out. Though that wouldn't be hard considering it was in the low 60s outside. And the places measured happened to be courtrooms and tax offices where the body heat from anxiety alone could probably melt the paint some days. ???San Franciscans Omosheyin said are losing their perspective when it comes to things like electricity energy alerts and rolling blackouts. In his native country of Nigeria he said the electricity runs sporadically if at all. ???There the power can go off for a week he said. The world goes on. Here people take a lot of things for granted and electricity is one of them. ???As for the offices of the places that report on such matters they fared about the same. ???The Walnut Creek bureau of The Chronicle where the sun sizzles into the 90s with regularity in the summer is kept at 67 degrees because of all the computers. The main newsroom of The Chronicle is kept at 71 degrees because of all the computers. But the reception room was 71 degrees too and there aren't any computers there not a one. ???Some offices keeping their cool Place ????Outside ?temperature Control Room California Independent Systems Operator (Folsom) ?????????????????69 ??????90 Governor's office Capitol (Sacramento) ???75 ??????94 Press briefing room Capitol (Sacramento) ?68 ??????94 Caltrans headquarters (Sacramento) ????????70 ??????94 Chronicle bureau newsroom (Walnut Creek) ??67 ??????90 Mayor's Office San Francisco City Hall ???73 ??????63 Calif. Public Utilities Commission lobby (San Francisco) ???????????????????????????63 ??????63 State Building (San Francisco) ????????????69 ??????63 Courtroom 19th floor Federal Building (San Francisco) ???????????????????????????70 ??????63 Lobby Pacific Gas and Electric headquarters (San Francisco) ??????????????65 ??????65 IRS office Federal Building (San Francisco) ???????????????????????????69 ??????63 Main newsroom San Francisco Chronicle (San Francisco) ???71 ??????64 ???E-mail Steve Rubenstein at srubenstein@sfchronicle.com. GRAPHIC: PHOTO (2):CHART: SEE END OF TEXT (1) It's too warm for jackets in the chief clerk's office in the state Capitol building in Sacramento. (2) Jane Malison of Millbrae needed a fan while touring a warm section of the state Capitol but other parts of the building are kept below 70 degrees. / Photos by Kat Wade/The Chronicle LOAD-DATE: May 29 2001 of 98 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ?????????????????????MAY 29 2001 TUESDAY FINAL EDITION SECTION: NEWS Pg. A1 LENGTH: 1238 words HEADLINE: Bush facing Davis' heat over energy In first visit to state as president he'll hear governor's plea for help SOURCE: Chronicle Political Writers BYLINE: Carla Marinucci Lynda Gledhill BODY: President Bush wasn't on California soil for more than five minutes yesterday when he was drawn into his first debate on the state's power crunch. ???Rep. Brad Sherman a Democrat from Thousand Oaks who met Air Force One on the tarmac at Los Angeles International Airport along with a group of high school students wasted no time button-holing the president for what appeared to be an animated conversation. ???I brought up . . . the idea that after his meeting with our governor I hoped he would be in favor of wholesale regulation (of energy prices) Sherman said later. He disagreed with me. ???Sherman -- who two weeks ago suggested that the headline to the president's national energy policy should be Bush to California: Drop Dead -- didn't seem optimistic yesterday about Bush's 48-hour visit to the state. I think that the president's policies show either a lack of understanding of what's really going on in California or a lack of concern he said. ???That vignette underscored some of the challenges facing Bush who arrived in California as protesters geared up and Democratic Gov. Gray Davis prepared to press him for federal action on the state's power troubles. ???Besides Sherman Bush was greeted by a crowd of cheering Republicans including Secretary of State Bill Jones and Los Angeles Mayor Richard Riordan the former a declared GOP candidate for governor in 2002 the latter a rumored one. ???But today Bush will sit down with the present governor who lately has been blistering in his criticism of the president. ???The last time I looked California was still part of the United States of America Davis told reporters this weekend. We have contributed disproportionately to the economic growth of this country. There's no reason why a president should not respond to a legitimate request from the chief executive of the largest state in the union. ???In his first visit to California since just before the election Bush plans to emphasize the energy crisis -- but will focus on it through the lens of his own energy plan. ???ENERGY SECRETARY ACTS ???Just hours before the president landed Energy Secretary Spencer Abraham ordered a speedup in planning to relieve a notoriously overloaded electricity transmission line in California. ???Abraham's holiday action was timed to provide a bit of positive news for Bush to announce in California. He ordered the Western Area Power Administration a 15-state marketing arm of the Energy Department to complete planning and seek outside financing to reduce the transmission bottleneck on California's Path 15 which connects the northern and southern parts of the state. ???This morning Bush will visit the Marine Corps base at Camp Pendleton near San Diego to underscore his conservation order for a 10 percent cut in energy usage in federal buildings and military facilities. ???In Los Angeles he will deliver a wide-ranging talk before the World Affairs Council and lead a discussion among business leaders about technological advances in energy conservation. ???Then he will head to Fresno and Sequoia National Park to press his initiative to improve national parks. Along the way protesters have vowed to provide a vocal commentary on Bush's energy and environmental policies. ???But the real drama of the trip will no doubt be the sit-down between Bush and Davis today. The governor pushed for a lengthy open meeting with Bush that would include testimony from officials and consumers affected by the energy crisis. Bush's camp announced Friday the meeting would be 20 to 30 minutes -- in private. ???Davis plans to outline steps the state has taken to alleviate the energy crisis and what it wants the federal government to do -- including implementing price caps on the wholesale cost of energy cost-based pricing and the possibility of ordering refunds. ???DAVIS THREATENING SUIT ???The governor has said he will consider suing the Federal Energy Regulatory Commission -- the agency charged with overseeing energy prices -- if it does not impose temporary price caps. ???And the state Legislature has already filed a suit saying the commission has failed to stop what it has determined are unjust and unreasonable prices. ???With California's energy woes worsening and a summer of rolling blackouts predicted the Bush-Davis session holds potentially deep political pitfalls for both leaders both of whom are suffering in state polls as a result of their handling of the energy crisis. ???Bush needs to demonstrate his concern for California a state that gave a 12-point margin of victory to Al Gore in the presidential election. ???But even as Bush adviser Karen Hughes told state reporters this week that the president had arrived to show he cares Vice President Dick Cheney again chastised state officials for delaying their response to the energy crisis because all of the action was potentially unpleasant. ???And Cheney signaled that the administration would resist long-term price caps saying We think that's a mistake. ???Such talk drew fire from Davis' senior political adviser Garry South who charged that Cheney's words demonstrated insensitivity to California's troubles and only underscored the perception of an all-oil all-the-time ticket. ???Davis whose campaign for re-election next year will depend on his handling of the crisis has stepped up his criticism of Bush and profit-hungry energy firms particularly those from Texas in recent weeks. ???And yesterday signaling no letup Davis' supporters made an unusual holiday conference call to again press his case for federal action. They argued that without immediate intervention from the Bush administration the economy of California -- and potentially the entire nation -- was at risk. ???'THIS ENORMOUS SHOCK' ???We have this enormous shock in prices that needs to be addressed and not ignored said Joseph Fichero head of Sabre Partners and a consultant to Davis. ???Alan Blinder a Princeton economist and former vice chairman of the Federal Reserve warned that energy woes in California alone would take almost a half a percent of the gross domestic product off of the national economy. ???Blinder and others argue that short-term relief -- for about 6 to 12 months -- is necessary while new power plants are being built. ???Most times and most places I agree price caps are not the long-run solution but they can be part of a short-term solution Blinder said. There really is a case for temporary price caps to shield consumers and the California and national economy from the full force of the energy shock. ???Limited new price caps approved by the Federal Energy Regulatory Commission on the sale of wholesale electricity begin today in California. But the temporary caps which go into effect when the electricity reserves dip below 7.5 percent have been lambasted by Davis as ineffective and inadequate. ???Political analysts say Bush's resistence on the issue could cost him in California -- and elsewhere. ???(California) is probably an area where he is criticized more than any other region in the country said Mark DiCamillo director of the statewide Field Poll. Californians are looking to Bush for some relief -- and to the extent they don't get it Bush may be in some jeopardy here.Chronicle news services contributed to this report. / E-mail the writers at cmarinucci@sfchronicle.com and lgledhill@sfchronicle.com. GRAPHIC: PHOTO (2) (1) Rep. Brad Sherman (left) D-Thousand Oaks buttonholed President Bush as he arrived at Los Angeles International Airport to discuss the state's energy crisis. (2) President Bush signed autographs for students from El Camino High School at Los Angeles airport. Bush is to meet with Gov. Davis today. / Photos by Carlos Avila Gonzalez/The Chronicle LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 Gannett Company Inc. TODAY ?????????????????????May 29 2001 Tuesday FIRST EDITION SECTION: NEWS Pg. 3A LENGTH: 426 words HEADLINE: Davis to urge Bush to back electricity price cap BYLINE: Laurence McQuillan DATELINE: LOS ANGELES BODY: LOS ANGELES -- California Gov. Gray Davis will urge President Bush today to back a 2-year cap on electricity costs as the best way to keep his power-starved state -- and possibly the U.S. economy -- from sinking into recession. ???The Democratic governor and Republican president who have been sparring from afar over energy policy will meet here to discuss their differences. The White House has said repeatedly that it opposes price caps as a way to deal with energy shortages in California. ??In an interview with USA TODAY Davis said a limit on wholesale electricity costs is needed while the state attempts to build 15 new power plants. He said that would still allow a 30% profit margin. ??While the president didn't create this problem he is uniquely situated to solve it Davis said. I'll make clear that he has an opportunity to relieve the pain and give California the breathing space to put more plants online. ???Bush making his first visit to California as president unveiled a long-term energy policy this month that calls for increased production and to a lesser extent conservation. The president will promote conservation steps being taken by the federal government during a visit today to the Marine Corps base at Camp Pendleton. ??The president believes that imposing price caps will only make the problem worse White House spokesman Dan Bartlett said. ??Davis whose popularity has plummeted as Californians cope with blackouts to offset electricity shortages said his state's problems could hurt all Americans if they are not dealt with quickly. I'm asking for some form of relief that reduces the outrageous prices we're currently bearing he said. Without that relief lots of people will lose their businesses and California could well be dragged into a recession. Since we're about one-eighth of the national economy that doesn't bode well for America. ???The California Public Utilities Commission has announced rate increases of up to 50% for businesses and 37% for homes. ??Bush has sidestepped California after losing the state by 12 percentage points to Democrat Al Gore last year in the presidential election. But with Democrats targeting several GOP House members in next year's elections Republicans must go on the offensive or risk losing control of the closely divided House of Representatives. ??Davis a possible presidential candidate in 2004 said he wants to avoid rancor with Bush: I'm saying 'Look we got into this in a bipartisan way. We should get out of it in a bipartisan way.' LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 The Washington Post Washington Post ?????????????????????May 29 2001 Tuesday Final Edition SECTION: A SECTION Pg. A02 LENGTH: 639 words HEADLINE: Energy Chief Moves To Aid California Transmission Plan Precedes Bush Visit BYLINE: Mike Allen Washington Post Staff Writer DATELINE: LOS ANGELES May 28 BODY: ???President Bush landed at ground zero of the nation's energy worries tonight hours after Energy Secretary Spencer Abraham speeded up planning to relieve a notoriously overloaded electricity transmission line through California. ???Abraham's holiday action was timed to provide a bit of news for Bush to announce during his first presidential trip to California where he is to hold a politically charged private meeting with Gov. Gray Davis (D) on Tuesday. Bush's aides said he will pledge to cooperate with California but will stick to his position that no action by the federal government can prevent the rolling blackouts expected this summer. ???Abraham ordered the Western Area Power Administration a 15-state marketing arm of his department to complete planning and seek outside financing for an increase in transmission capacity that he said would be a big step in the right direction and a big step forward for Californians. ???California's electricity problems developed over a period of years and cannot be solved overnight Abraham said in a news release. However we can move now on actions that will help avert the same types of problems from recurring year after year. Today's action is designed to reduce the bottleneck on California's Path 15 which connects the northern and southern parts of the state. ???Davis who is seeking reelection next year has seen his poll ratings plummet as electricity prices soared utilities hit dire financial straits and homes and businesses were surprised with blackouts. ???Bush has taken several steps to try to encourage additional power generation in the state but has maintained since before he took office that California's problems were created here -- through a troubled effort at electricity deregulation and public opposition to construction of additional power plants -- and would have to be solved here. ???Davis plans to use the meeting to lobby Bush once again to endorse a cap by the Federal Energy Regulatory Commission on the wholesale price of electricity. Again and again the administration has said it will not take that step. ???This administration does not and will not support energy price controls Bush told a business audience in March. Price controls do not increase supply and they do not encourage conservation. Price controls contributed to the gas lines of the 1970s. And the United States will not repeat the mistake again. ???Davis energy advisers told reporters on a conference call today that without the cap California energy costs could be $ 50 billion higher this year than two years ago. Alan S. Blinder the Princeton University economist and former Federal Reserve Bank vice chairman said on the call that California's energy crisis should be enough to get the attention of policymakers in Washington. ???The visit by Bush who flew here after making a Memorial Day speech at a fighter aircraft museum in Mesa Ariz. is being carefully managed to avoid contact with the general public. After speaking to military families at Camp Pendleton on Tuesday morning he plans to address a luncheon meeting of the Los Angeles World Affairs Council which has sold out of tickets at $ 75 for members or $ 85 for guests. ???Afterward Bush will hold a closed-door session with business people and then meet with Davis for 20 minutes. As Bush departs Davis plans to make an immediate statement for cameras. ???Although Bush says he has taken more than a dozen steps to help California Davis says price caps are essential and has said he may sue the federal government in an effort to get them if Bush does not go along. ???He has been helpful on a number of small matters and I appreciate his assistance Davis said during a telephone interview on Friday. But the big enchilada is the price of electricity. LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 The Washington Post Washington Post ?????????????????????May 29 2001 Tuesday Final Edition SECTION: A SECTION Pg. A03 LENGTH: 1936 words HEADLINE: It's Still Dawn for Solar Power in L.A. Despite City Subsidies Homeowners Hesitate to Install Expensive Alternative Energy Source BYLINE: William Booth Washington Post Staff Writer DATELINE: LOS ANGELES BODY: ???One year ago this city announced its intent to become the Solar Capital of the World with 100000 roofs covered with solar electric panels by the end of the decade an audacious goal to transform the homes of this smoggy but sunny metropolis into miniature power plants. ???To fulfill what is perhaps the nation's most ambitious solar campaign the Los Angeles Department of Water and Power began offering substantial buy down subsidies that would reimburse rate payers for half the price of each new solar energy system. For the average home a photovoltaic package costs between $ 10000 and $ 20000 parts and labor included before the rebate. ???How many have been installed? ???At last count about 40. ???That leaves only 99960 rooftops to go. ???The Bush administration and especially Vice President Cheney architect of its energy plan have been criticized for skepticism regarding alternative energy sources. But a close examination of the Los Angeles solar experiment and a review of similar programs suggest the former oilmen in the White House have a point: Solar at least has not proven ready for prime time. ???For all of Los Angeles's good intentions and for all of solar's many positive attributes the problems of harnessing its power remain. Some of those challenges are economic and some technological others are more mundane but often ignored such as finding a qualified contractor a homeowner can trust to drill dozens of holes in the roofs to mount the things. ???In a reprise of the 1980s solar again is hot. The price of photovoltaics is dropping and interest is growing. Other states such as New York Arizona Florida and Washington are moving to join California in major efforts to wire homes to draw power from the sun. ???But as many Americans are beginning to understand the delivery of energy is like a complex interconnected assembly line and the devil lurks in the details. ???The Los Angeles experiment tells the story shared by other locales. In L.A. for example the city's lone solar panel manufacturer has not been able to supply enough systems to meet demand. ???The systems too are often oversold by solar proponents. In the real world most do not pay for themselves in a few years as some advocates claim but take 20 years or more to return their initial cost in the form of reduced utility bills. ???Nor are the systems maintenance-free: At a minimum the rooftop panels must be routinely cleaned of pollution dust and leaves. ???They cannot be installed efficiently on homes without shade-free south-facing roofs the shadow from a neighbor's palm tree can frustrate the system's photovoltaic cells. ???Nor will the most common systems allow buyers to live off the grid unless they want to purchase a large bank of batteries. Even with the batteries homeowners probably would not be able to run their washing machines and air conditioners at the same time. ???It is not an economic proposition at this point conceded Terry Peterson a solar expert at Electric Power Research Institute in Palo Alto Calif. But one day Peterson predicts 100 years from now solar energy will provide a substantial percentage of the world's energy needs. In a decade or two the cost of solar will likely be competitive with other energy sources such as natural gas nuclear or coal. ???But now? It is still a luxury item. Like buying a swimming pool Peterson said. ???I really like the idea of running my house with solar power said Andrew Chin a potential customer in Los Angeles who has been researching a purchase. But they're still pretty expensive even with the rebates and so I gotta ask myself what am I doing this for his conscience or his wallet. I'm thinking I might wait until they work the kinks out. ???The most knowledgeable and experienced solar contractor in Los Angeles is probably Graham Owen the founder owner and single full-time employee of Go Solar Co. ???His installation of a one-kilowatt solar electric system on a home in the San Fernando Valley was the first to be awarded a rebate by the Los Angeles power department in March. ???How many systems has he installed as part of the rebate program? Three. ???But Owen is a true believer and over the next year he plans to cover hundreds of roofs with solar panels. On his shelf Owen still has an unreturned library book The Coming Age of Solar Energy published in 1963 and checked out from his high school in Lennox Hills Ill. in 1979. I guess we're still stuck in the coming age of solar energy he said smiling. He recalled that the buzz about solar water heaters in the 1980s led to disappointment with shoddy workmanship and less than spectacular energy savings. ???Until recently there has been little widespread interest in solar electric power. Since 1998 the California Energy Commission has been pushing its own program to encourage homeowners to erect photovoltaic panels on their roofs offering to subsidize about one-third of the cost. ???Across a state with a population of about 35 million only 450 solar energy systems have been installed on homes. ???Then the California energy crisis struck with its power interruptions and steep rate increases and the phone calls began to overwhelm Owen's voice mail. ???On days with rolling blackouts? I get a hundred calls maybe more Owen says. His Web site www.solarexpert.com is now receiving 3000 hits a day. Customers are begging him to do jobs. ???The Los Angeles power department reports a similar surge in interest since the energy crisis began six months ago. Customer demand has shot through the roof says Angelina Galiteva executive director for strategic planning at the Department of Water and Power. She estimates that her department receives 1000 calls on some days about its solar subsidy program. ???Yet while the reliability and cost of solar electric technologies continue to improve solar power today accounts for only a sliver of the national pie chart of energy production -- less than 1 percent. The country produces about 300 megawatts of electricity with solar -- about the same amount produced by a single mid-sized traditional power plant. ???The current trend for photovoltaics is not to erect large centralized solar farms in the desert an experiment that withered in the 1980s but to pursue distributed generation or individual units on scattered rooftops. ???The problem has consistently been the cost of the solar panels which has been too steep to justify them except for customers who are committed environmentalists or techies who like the elegance of the systems. ???Los Angeles began its solar experiment after Sacramento legislators mandated that utilities spend about 3 percent of their revenue on efficiency conservation and renewable energy. For solar the power department committed $ 75 million over the next five years -- enough to subsidize panels on 7500 homes. ???The power department will pay $ 5 for each watt of solar installed on a residence or business. Homeowners typically purchase a one-kilowatt or two- kilowatt (1000 or 2000 watts respectively) solar electric system meaning that the municipal utility would pay between $ 5000 and $ 10000 of the cost up front -- an enticing tax-free offer. ???For many years I wanted to do solar but it was so expensive said LaWanda Geary in the San Fernando Valley who in April had Owen install 32 panels for a two-kilowatt system on her sunny roof. The rebate really got me going. I don't know many times when the government offers to pay half of anything. ???The systems that are eligible for rebates must be tied into a utility's electric power grid meaning that during the day when the sun is shining the panels are adding a stream of electrons used by the home to run its lights and appliances. ???If there is a surplus of solar power that electricity goes back into the power lines and is passed along to a neighbor and the electric meter at the house actually runs backward. Homeowners however are not selling their excess electricity -- they're giving it away to the utility company. ???On cloudy days and at night the home is not being powered by solar energy but getting its electricity the traditional way from the power lines. ???Calculations on savings vary. A two-kilowatt solar system can supply an average-sized home with 20 to 80 percent of its electrical needs depending on how many lights appliances and air conditioners are running and how efficient they are. ???After the subsidy and depending on how the system is paid for (in cash or with borrowed funds) a solar system can pay for itself in as little as six years and as much as 36 years. Owen assumes about 20 years. ???Potential solar clients moreover often mistakenly assume that going with the sun will take them off the grid which is not possible without a large bank of batteries that costs several thousand dollars more. Because the solar panels are still wired to the power grid if there is a blackout the power in a solar house goes off just like everyone else's. If uninterrupted power is needed Owen suggests a diesel generator. ???Galiteva does cite one real advantage of solar: It reduces the electricity that must be purchased from power companies and protects to some degree a solar home from the full brunt of upwardly spiraling rate increases. Unfortunately for solar enthusiasts the L.A. Department of Water and Power which was not deregulated along with the three other major utilities in California has perhaps the cheapest and most stable supply of electricity in the state making the economic argument harder to make. ???To receive the full $ 5 per watt subsidy the L.A. Department of Water and Power requires a homeowner to purchase solar panels from a manufacturer based in the city. The idea is not only to become the solar capital of the world but also to encourage local growth of an emerging industry and create jobs. ???One hitch is that no solar panel makers were located in Los Angeles. ???After lengthy negotiations Siemens Solar Industries based in Camarillo Calif. an hour's drive to the north announced in February that it would open a solar panel manufacturing plant in Los Angeles. But it is not a complete facility: The L.A. plant does only some final assembly and then the units must be returned to Camarillo for final testing and shipping. ???Tina Nickerson a spokeswoman for Siemens Solar estimates her company has sold a couple dozen to L.A. homeowners for the rebate program. But she too reports that the interest from consumers is sometimes overwhelming and that supply has been a problem. Most U.S.-manufactured units are shipped overseas to places such as Germany Japan and Scandinavia which have had generous subsidies in place for years. ???LaWanda Geary had to call Siemens herself to push them to deliver panels for her house -- and she was eligible for the rebate because of a stopgap compromise that allows to Siemens to ship solar panels from Camarillo until its L.A. plant is fully operational. ???Everyone involved concedes there have been bottlenecks. Siemens now says it has enough panels to begin to meet demand and Owen and the city are hoping things will sort themselves out especially if more solar manufacturers are drawn to Los Angeles. But proponents worry about what will happen when the subsidies run out. ???Selling solar is now the easy part Owen says. I could sell a hundred a week. It's getting them up on the roof that's the hard part. LOAD-DATE: May 29 2001 of 98 DOCUMENTS ????????????????Copyright 2001 News World Communications Inc. Washington Times ?????????????????????May 29 2001 Tuesday Final Edition SECTION: PART A NATION INSIDE POLITICS Pg. A6 LENGTH: 1264 words BYLINE: Greg Pierce THE WASHINGTON TIMES BODY: ??TAKING YOUR MEDICINE ??Oakland Mayor Jerry Brown who was once governor of California likens current Gov. ?Gray Davis' handling of the electricity crisis to his own bungling of the medfly crisis. ??Here's an analogy to the medfly crisis Mr. ?Brown said in an interview with the Los Angeles Times' Douglas Foster. ?When I first heard about the medfly I said 'Well it's just a few flies maybe they'll go away. ?Maybe they won't keep reproducing.' And the winter came and they stopped reproducing. ?And then somewhere around February or March I learned about something called 'spring emergence.' As the ground got warmer the larvae turned into flies and more medflies started appearing. It got out of hand and ultimately I had to order malathion spraying. ?It would have been better had I taken forceful action at the first notice of the medfly. ??Mr. ?Foster asked: Are you saying that the governor missed opportunities to act early in the same way? ??Mr. ?Brown replied: There's an analogy there. ?I didn't want to spray because I knew the people in Santa Clara County didn't want to have helicopters spraying malathion over their homes. ?It didn't sound good. ?As governor I wouldn't have wanted to see rate increases either. ?But sometimes you have to take your medicine early. ?It's less bitter than if you postpone it. ??Mr. ?Davis served as Mr. ?Brown's chief of staff when the latter Democrat was governor. ??ENERGETIC CRITICISM ??President Bush's energy plan already under fire from Democrats and environmentalists is dismissed by National Review the conservative magazine as so much political posturing. ??The hyperbolic attacks on the Bush plan by environmentalists (as an attempt to poison the air and kill the caribou) shouldn't trick conservatives into an exaggerated sense of its merit the magazine says in an editorial in its current issue dated June 11. ??The basic thrust of the administration's thinking on energy is sound: a growing economy requires more energy which in turn entails more production. But the Bush plan itself is a political document meant to placate corporate interests environmentalists and everyone in between and so is festooned with an embarrassment of subsidies and incentives that will at best prove an irrelevance. ??As Jerry Taylor of the Cato Institute writes in this issue the phantom energy crisis is already healing itself. ?Power plants are being built at a rate that outpaces Dick Cheney's benchmark of one plant a week. Altogether almost 100000 new daily megawatts of electrcity capacity are scheduled to be available nationwide by next year. ?This is twice the amount of electricity that California now uses on an average day. ?While Cheney has been sitting with his advisers around a White House conference table investors and entrepreneurs have been digging building and refining his energy problem into oblivion. ?By the time all the Bush plan's tax credits have kicked in there may well be an energy glut. ?All of this is thanks to the most efficient energy plan known to man: market pricing. ??WRONG ON BOTH COUNTS ??The buzz in the media after Sen. ?James Jeffords' switch put Democrats in control of the Senate was that President Bush must change his ways. ?He has to become more moderate. ?Why? ?Because only that will prevent more Republican defections and it's the president's one hope for getting his agenda through Congress. ?This is wrong on both counts Fred Barnes writes in the Weekly Standard. ??Bush and GOP congressional leaders bent over backwards to accommodate Jeffords and liberal Democrats on education the senator's top priority. Jeffords bolted anyway. ?On taxes Bush stuck with his conservative tax cut until nearly the end when he compromised just enough to assure passage. Jeffords voted with him Mr. ?Barnes said. ??The truth about the impact of Jeffords' move is that no political earthquake has occurred. ?The Senate is ideologically unchanged. ?The swing votes in the Senate including John McCain are important but they already were. ?There's no clear path to victory for the Bush agenda after taxes and education but that was always true. ?To pass a patients' bill of rights a prescription-drug benefit or missile defense a bipartisan coalition of some sort will be essential. ??Yes there's one big change with Democrats taking over: judges. ?Bush will have a harder time getting conservative nominees through a Senate Judiciary Committee run by Patrick Leahy perhaps the most partisan Democrat on Capitol Hill. ?One more downbeat side effect: Jeffords' announcement overshadowed Bush's tax-cut victory denying him any political momentum he might have gotten from it. ??INCOHERENT REBEL ??Before liberals put James Jeffords on Mount Rushmore can we please stop and note how he's already betrayed Democrats and his own avowed principles by deciding that his defection won't take effect until after President Bush's wrongheaded tax cut has been signed into law? syndicated columnist Matthew Miller writes. ??Any traitor (I mean 'man of conscience') worth his salt shoves the knife in to the hilt - otherwise what's the point? ?Machiavellis throughout history have wisely advised that when you move against the king you'd better finish him off Mr. ?Miller said. ??Yet Jeffords took pains to make sure his switch wouldn't derail the centerpiece of Bush's agenda the very agenda that inspired Jeffords' move and which Jeffords had the power to stop via his action. ??We are dealing in other words with a deeply incoherent rebel. ?This would be a private matter for Jeffords to sort out with his therapist were not his cowardice in this moment of 'courage' so consequential for the country. ??THE LONELY VERMONTER ??In the final analysis Vermont Sen. ?James M. ?Jeffords was out of step with his party making his departure appropriate if politically inconvenient. ?Those who argue that it was the party out of step with Jeffords some political analysts are saying are those who wish the Republicans no good. UPI political analyst Peter Roff writes. ??The conservative low-tax minimal-government Republican Party enjoys national parity with the Democrats something the Northeastern liberal GOP could not achieve. ?Jeffords is in that regard these observers say out of step with victory. ?One GOP consultant went so far as to say 'If the Republicans were doing better in New England Jeffords would not have been so lonely. ?Why is it that the people from states where the GOP usually doesn't win think they can tell the rest of us how to run the party and what we all should believe? ?It doesn't make sense.' (spade) ??There are those in the GOP who regret the loss of the majority that Jeffords' defection brings but very few if any are mourning the loss of the lonely Vermonter Mr. ?Roff said. ??LAST WORDS ??Brill's Content asked PR pros how they would handle Vice President Richard B. Cheney's heart problems. ??It's inconceivable that Mr. ?Cheney can put in the kind of time we're led to believe he is without putting himself at risk one public relations man John Scanlon told the magazine. ?My recipe for controlling the situation would be photo-ops access to his schedule and a couple of exclusive articles. ?He's got to convince people he's fit for the job. ??Unfortunately Mr. ?Scanlon did not live to see his quote in the magazine's June issue the New York Post reports. ?He died of a heart attack. ??* Greg Pierce can be reached at 202/636-3285 or by e-mail at gpierce@washingtontimes.com. LOAD-DATE: May 29 2001 of 98 DOCUMENTS ????????????????Copyright 2001 News World Communications Inc. Washington Times ?????????????????????May 29 2001 Tuesday Final Edition SECTION: PART A NATION Pg. A4 LENGTH: 809 words HEADLINE: Bush faces tough sell on visit to California Davis likely to be rebuffed on price caps BYLINE: Joseph Curl THE WASHINGTON TIMES DATELINE: LOS ANGELES BODY: ??LOS ANGELES - Twenty minutes - that's how long Gov. ?Gray Davis who has accused the Bush administration of ignoring California's energy crisis will have to sway President Bush in a meeting today to consider imposing federal price caps on wholesale power prices. ??His plea likely will fall on deaf ears. ??That's simply not going to happen said one senior Bush official. Both Mr. Bush and Vice President Richard B. ?Cheney who on Friday again blamed the state government of California for the energy crunch oppose cap measures. ??In his first visit to California since the presidential election where he lost the state to former Vice President Al Gore by 54 percent to 41 percent Mr. Bush hopes to sell his national energy policy to a vocal group of opponents. But the hue and cry has been muted of late since residents have battled rolling blackouts and sky-high gasoline prices. ??A new poll released Friday shows 59 percent of Californians many of whom have been longtime foes of nuclear energy now believe the non-polluting energy source may be the way to solve the state's problems. ??Mr. ?Davis' popularity has plummeted. ?The Democrat facing re-election next year and often mentioned as a presidential candidate is viewed as having poor job performance by 60 percent of Californians according to a survey by the Public Policy Institute of California. ??In a small gesture to California Energy Secretary Spencer Abraham yesterday announced plans to increase transmission capacity in California which he said would be a big step in easing rolling power blackouts. ??Abraham ordered the Western Area Power Administration - an Energy Department arm responsible for marketing electricity from federal water projects in 15 Western states - to wrap up planning for building extra transmission capacity. ??The governor has repeatedly blamed Mr. ?Bush who took office four months ago for the energy crunch in California. ?He points the finger of blame far outside the state's boundaries primarily at Washington and Mr. Bush's home state. ??The people that have dropped the ball are the federal government Mr. Davis said last week. ?They need to reimpose a price cap because we're being obscenely gouged by price gougers out of Texas and the Southwest. ?. . . There's a massive transfer of wealth going on from ordinary citizens in California to Texas. ??Mr. ?Davis has also charged that utility companies are withholding power in order to drive up prices a claim the Federal Energy Regulatory Commission has investigated and dismissed. ??Mr. ?Bush and Mr. ?Cheney have often pointed out that California is second only to Rhode Island in conservation efforts but the state is on the brink of an energy supply collapse. ??Still despite the state's failure to build new power plants Mr. Davis says California is entitled to a federal bailout approved by Mr. Bush. ??I'm going to keep asking him to do it because we're part of America. The state the last three years has led American economic growth. ?. . . We're doing everything we can out here he said. ??In the Democratic response to the president's weekly radio address Mr. Davis accused the president a former oil man of being concerned only with the petroleum magnates. ??With all due respect I urge you to stand up to your friends in the energy business and exercise the federal government's exclusive responsibility to ensure that energy prices are reasonable he said. ??Many analysts however blame the state's deregulation scheme and failure to construct adequate electrical generating capacity. ?The price wholesale power providers can charge utilities is not capped but the fee those companies can charge users is capped - resulting in massive debt for providers. ??The state was slow to respond to increased demand the analysts say even though the state is building 10 new power plants four of which will come on line this summer. ??In his national energy policy Mr. ?Bush lays out 105 proposals that focus on increasing domestic supply improving the nation's ability to move energy between regions and increased conservation. ?But the policy is geared more toward long-term solutions - such as decreasing America's reliance on foreign oil - than short-term relief for Californians and motorists nationwide. ??Mr. ?Cheney who heads the president's energy task force and said Friday that California knew for more than a year about the impending energy shortage has promoted nuclear power as essential to America's energy needs. ?He said that at least some of the 65 power plants that need to be built annually to meet future electricity demand ought to be nuclear. ??A poll by the Field Institute last week found many Californians now agree. Although nuclear energy produces 20 percent of the nation's energy California has just two nuclear plants. GRAPHIC: Photo Gov. ?Gray Davis LOAD-DATE: May 29 2001 of 98 DOCUMENTS ????????????????????Copyright 2001 Chicago Tribune Company Tribune ???????????????May 29 2001 Tuesday NORTH SPORTS FINAL EDITION SECTION: News Pg. 6 ZONE: N LENGTH: 514 words HEADLINE: Bush backs WW II project BYLINE: From Tribune news services. DATELINE: LOS ANGELES BODY: ??President Bush promised World War II veterans a Washington memorial that will stand for the ages and paid Memorial Day tribute to America's fallen soldiers before embarking on a three-day West Coast swing to try to ease his political problems in California. ??Bush landed at ground zero of the nation's energy worries Monday night hours after Energy Secretary Spencer Abraham speeded up planning to relieve a notoriously overloaded electricity transmission line through California. ? ??Abraham's action was timed to provide a bit of news for Bush to announce during his first presidential trip to California where he is to hold a politically charged private meeting with Democratic Gov. Gray Davis on Tuesday. Bush's aides said he will pledge to cooperate with California but will stick to his position that no action by the federal government can prevent the rolling blackouts that are expected this summer. ??Abraham ordered the Western Area Power Administration a 15-state marketing arm of his department to complete planning and seek outside financing for an increase in transmission capacity that he said would be a big step in the right direction and a big step forward for Californians. ??California's electricity problems developed over a period of years and cannot be solved overnight Abraham said in a news release. However we can move now on actions that will help avert the same types of problems from recurring year after year. Monday's action is designed to reduce the bottleneck on California's Path 15 which connects the northern and southern parts of the state. ??Davis who is seeking re-election next year has seen his poll ratings plummet as electricity prices soared utilities hit dire financial straits and homes and businesses were surprised with blackouts. ??For most of Monday however Bush focused on U.S. veterans and the solemn ceremonies in two states honoring those who never returned from America's wars. ??Their losses can be marked but not measured Bush said at the traditional Memorial Day ceremonies at Arlington National Cemetery in Virginia. We can never measure the full value of what was gained in their sacrifice. We live it every day in the comforts of peace and the gifts of freedom. ??Bush also laid a wreath at the Tomb of the Unknowns. ??Later he traveled to Mesa Ariz. to pay tribute to veterans at the Champlin Fighter Aircraft Museum. He asked the crowd to observe a nationwide moment of silence at 3 p.m. Arizona time. ??Any foe who might challenge our national resolve will be repeating the grave error of defeated adversaries the president said. ??Bush opened the day at the White House where he signed legislation to construct a World War II monument on the National Mall a setting criticized by some. Bush said the monument between the Washington Monument and Lincoln Memorial will stand for the ages. ??I will make sure the monument gets built the president told an audience of veterans in the yellow-curtained East Room among them former Sen. Bob Dole (R-Kan.) who has supported the memorial. ??. GRAPHIC: PHOTOPHOTO (color): President Bush and Maj. Gen. James T. Jackson attend Monday's wreath-laying at Arlington National Cemetery's Tomb of the Unknowns. AP photo by Ron Edmonds. LOAD-DATE: May 29 2001 of 98 DOCUMENTS Associated Press The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????May 29 2001 Tuesday BC cycle AM Eastern Time SECTION: Domestic News LENGTH: 604 words HEADLINE: Bush announcing low-income aid but no price caps BYLINE: By SCOTT LINDLAW Associated Press Writer DATELINE: LOS ANGELES BODY: ??President Bush traveled across the country to deliver news Gov. Gray Davis doesn't want to hear: He won't force down soaring electricity prices that have cost California nearly $8 billion since January. ??The Republican president and the embattled Democratic governor arranged a 20-meeting Tuesday to talk about California's energy crisis but there was no indication they would break their stalemate. ??Bush opposes price limits on wholesale electricity that utilities buy arguing they do nothing to address supply-and-demand issues at the heart of the crisis. ??Davis contends federal energy regulators are ignoring their mandate to ensure just and fair electricity prices. ??With no sign of a break in the deadlock each side maneuvered for maximum advantage from Bush's first full day in California as president. ??Davis in an interview Tuesday on ABC's Good Morning America defended his record on licensing more power plants. ??We've licensed 15 plants. Ten are under construction four will be online this summer four next summer and by the end of 2003 we will have built our way out of this problem. But between now and then we are getting gouged unbelievably Davis said. ??The Bush administration timed positive energy announcements to coincide with the president's visit. ??At the Marine Corps base at Camp Pendleton Bush was announcing the expansion of a program that provides federal money to help low-income residents pay for power. ??Bush was proposing $150 million in addition to $300 million already budgeted for a component of the Low Income Home Energy Assistance Program to provide special help to cash-strapped residents of California and certain Midwest areas such as Chicago a senior administration aide said. ??Bush was also reminding state residents of his order that military facilities in the state cut peak-hour usage by 10 percent. ??To alleviate an electricity bottleneck on a crucial south-north transmission path the Department of Energy announced that the Western Area Power Authority will try to raise money from a variety of private and public entities to finance a crucial additional lines. ??The Bush administration is taking a leadership role in addressing a long-neglected problem in California's electricity transmission system said Energy Secretary Spencer Abraham. California's electricity problems developed over a period of years and cannot be solved overnight. However we can move now on actions that will help avert the same types of problems from recurring year after year. ??Davis had a letter for Bush from top economists who maintain price caps are justified and necessary. ??Aides to the governor expressed amazement that Bush would travel all the way to California with no major announcement in hand and predicted Davis would respond with polite rage. ??Mindful of the national stage he commanded Davis planned a news conference to air his grievances. And he convened a panel of families he said have been victimized by the energy crisis in the same hotel where Bush was staying. ??Davis wants Bush to pressure the Federal Energy Regulatory Commission to impose stiff price caps. ??Tuesday limited caps ordered last month by FERC go into effect in California but only when electricity reserves fall below 7.5 percent in the state - a step Davis called inadequate. ??Protesters planned demonstrations in Los Angeles and at Camp Pendleton in San Diego County. ??Bush also arranged a speech on energy and trade to the Los Angeles World Affairs Council and planned to president over a closed-door energy round-table discussion. GRAPHIC: AP Photos DSM106 KDJ102 LOAD-DATE: May 29 2001 of 98 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????May 29 2001 Tuesday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 594 words HEADLINE: Stakes are high for Davis meeting with Bush BYLINE: By GARY GENTILE AP Business Writer DATELINE: LOS ANGELES BODY: ??With California facing a summer of outages Gov. Gray Davis was to meet President Bush to press for a federal cap on energy prices. ??But Davis wasn't expected to win any concessions during the 20-minute Tuesday meeting where he's expected to point to Texas energy makers. ??Davis has appeared on national news programs attacking Bush for opposing price controls on wholesale electricity and suggesting the president has ignored price-gouging by Texas-based electricity generators. ??The president did not create this problem but he is uniquely situated to solve it Davis said Monday. What I'm going to ask him to do with all respect is to enforce federal law. The money that leaves this state goes directly to energy companies in Texas and the Southwest. ??If Bush refuses to administer price controls as expected Davis can use that as ammunition in his sparring with the administration. ??Bush has blamed California officials for the state's power woes and said price controls won't solve shortages. Instead they said Bush plans to stress his efforts to conserve energy in federal buildings and will bring one or two new initiatives to the table. ??One of them commits the federal government to helping organize a consortium to build more power lines for the state. ??Energy Secretary Spencer Abraham directed the Western Area Power Administration a federal agency to take the first steps to clear the way for building more transmission capacity between southern and northern California. That would help relieve a transmission bottleneck in the central part of the state. ??While this will not help this summer Abraham said in a statement the line improvements when completed will help avert the same types of problems from recurring year after year. ??The stakes of the meeting are high for both politicians. ??Davis who has been mentioned as a Democratic challenger to Bush in 2004 wants federal help to solve an energy crunch that threatens rolling outages this summer and has cost state taxpayers nearly $8 million since January - the price of buying power for two cash-starved private utilities. And his plan to rescue one of those companies reportedly is faltering. ??Leaders of both the state Senate and Assembly oppose a $3 billion-plus plan to bail out Southern California Edison by buying its power lines the Los Angeles Times reported Monday. ??Bush meanwhile needs to mend fences in vote-heavy California. The Republican president lost badly here in November and polls show most Californians dislike his handling of their energy crisis. ??Bush's Tuesday agenda was heavy on energy issues. At the Marine Corps base at Camp Pendleton near San Diego Bush was to highlight his order that federal agencies and installations cut back energy use. Then it was on to Los Angeles to discuss his energy plan in a speech to the Los Angeles World Affairs Council. ??Bush was confronted by the issue virtually as he stepped off the plane Monday in Los Angeles. Rep. Brad Sherman D-Los Angeles escorted the Academic Decathlon national championship team from El Camino Real High School in Woodland Hills to meet Bush. He told the president California needs regulation of electric generators. ??The president seems to believe just by instinct that rate regulation reduces supply and also by instinct that all those in the energy industry are fair people who are not trying to game the system Sherman said. Anyone who studies the facts in California knows that power is being withheld in order to drive up the price. LOAD-DATE: May 29 2001 of 98 DOCUMENTS ????????????????Copyright 2001 Burrelle's Information Services NEWS ??????????????????????SHOW: WORLD NEWS NOW (2:00 AM ET) 28 2001 Monday TYPE: Newscast LENGTH: 447 words HEADLINE: PRESIDENT BUSH VISITS CALIFORNIA WHERE POLITICIANS ARE CRITICAL OF HIS LACK OF ACTION FOR THEIR ENERGY CRISIS ANCHORS: DEREK McGINTY REPORTERS: JOSH GERSTEIN BODY: ??DEREK McGINTY co-anchor: ??When Air Force One touches down in California today it will mark President Bush's first visit to the Golden State since taking office. Now that fact has not been lost on Governor Gray Davis who has accused the president of ignoring his state's power crisis. ?As ABC's Josh Gerstein tells us Mr. Bush's visit could have major ramifications for his presidency and his party. ??JOSH GERSTEIN reporting: ??(VO) Since taking office President Bush has visited 28 states but until this week he had not found time on his schedule to visit the nation's most populous state California. ??Mr. DAN SCHNUR (GOP Political Consultant): Because the state is going through such extraordinary times right now because of the energy crisis his absence has been much more noticeable and the discussion about it's been much more heightened. ??GERSTEIN: (VO) Democrats have begun an aggressive effort to paint the president and other Republicans as obstacles to resolving the energy crisis. ??Offscreen Voice: (From TV Commercial) President Bush has offered no relief to hard-pressed rate payers. ??Text: ??The President...believe(s) that the issue is mostly a California matter... ??GERSTEIN: (VO) On Tuesday Mr. Bush meets with California Governor Gray Davis. ?He and other Democrats want the federal government to impose caps on wholesale prices for electricity. ??Representative ANNA ESHOO (Democrat California): Our people are hurting. We're bleeding in the sand. ?We need a tourniquet and the president is the one that can do this. ??GERSTEIN: (VO) During his trip President Bush plans to highlight the federal government's conservation efforts but aides say he will not endorse price caps. ??Mr. TUCKER ESKEW (Director White House Media Affairs): The president believes that capping wholesale prices would do nothing to lower demand or increase supply the two fundamental solutions to any energy problem such as this. ??GERSTEIN: Holding the line against price caps may have political costs. Most analysts give Mr. Bush little chance of winning California in 2004 but Republican congressmen there face re-election next year. ?So far five of them have endorsed some kind of limit on electricity pricing. ??Representative RANDY CUNNINGHAM (Republican California): We're in an extreme emergency right now. ?It takes extreme measures. ??Unidentified Woman: We are in rolling blackouts. ??GERSTEIN: (VO) While electricity may be in very short supply in California this summer the president and politicians of all stripes are likely to find there's more than enough voter anger to go around. ?Josh Gerstein ABC News the White House. LOAD-DATE: May 29 2001 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: TX Legislative Materials Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Protecting Confidential Information Body:: The exciting cocktail of credit derivatives and Enron Online raises significant novel legal risks for Enron. As most of you will by now know probably the most significant risk would arise in a situation where Enron has confidential information about a reference entity and wrongfully uses that information in pricing the credit derivative on that entity. This could well result in legal proceeding against Enron. In practice an allegation of misuse of confidential information can be very difficult indeed to defend without adequate procedures in place to safeguard that information. In fact Enron's credit trading will as you know rely strictly on publicly available financial information and will not involve the use of confidential information unless the reference entity has specifically consented. Nevertheless to avoid the appearance of impropriety we are taking additional steps to consider confidentiality agreements we have in place with potential reference entities before deciding whether or not we will quote prices on such entities. Against this background is the ever-present risk of insider dealing. This crime - which in the UK carries a maximum prison sentence of 7 years and an unlimited fine - is committed where a person (or member of their family etc) deals in the securities (shares bonds or derivatives on them) of a listed company on the basis of unpublished (confidential) price-sensitive information. We do not expect at this time to deal in publicly traded bonds as part of EnronCredit.com but insider dealing is relevant to the conduct of Enron staff and could affect other parts of our business. In addition SFA rules in the UK require the safeguarding of confidential information the misuse of which is a serious disciplinary matter. In order to ensure the success of this new business and that confidential information is not misused either by Enron or its staff we are now introducing important new policies and procedures in Europe and in the US. These procedures have been drawn up specifically for your credit trading group by lawyers in London Houston and New York and are attached. Please familiarise yourself and any future member of the group with these procedures. Once you have read and understood the attached procedures each one of you is required to confirm this to me in writing (or by note mail). Please note that similar procedures have been distributed to the key business heads in Europe who may have confidential information about reference entities (similar procedures are being disrtibuted to US business heads). This requires them to safeguard confidential information and to abide by the Restriced List procedure described below. Nevertheless you should treat your group as being within a Chinese Wall and see it as your personal responsibility not to solicit or accept from anyone in Enron information about reference entities which may be confidential. Thank you for your co-operation in implementing these important new procedures. I look forward to receiving your confirmation mentioned above (which is also described in the procedures). Best regards Paul What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential A&A PRC Results Body:: Hi got your message. We will have it to you before 4pm. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: WPTF Friday Deliver Unto Us A Burrito Body:: THE FRIDAY BURRITO ...more fun than a fortune cookie and at least as accurate. =01&Are those folks smoking crack?=018 he asked in an outrage. My friend = Ol=01 Dave in Houston has trouble understanding the workings of our power business here in California. In fact so do I. Yesterday=01s Joint Senate/Assembly Committee on Energy and Natural Resources did nothing to improve either Dave=01s or my understanding of the national embarrassment California is perpetrating with electricity deregulation. =01&The next thing you know they will be taking property and forcing utilities to build power plants and transmission=018 he mused between sips of Dixie longneck beer and chomps of jalapeno peppers. =01&Come to think of it Dave they did say something about that. Yeah=018 I recalled =01&Senator Peace was expounding on his favorite idea which is forcing the ISO or the utilities to build peakers and not let the market build them. I can=01t remember if that was before or after he suggested to EOB Chairman Kahn that the ISO and the PX should be folded into State agencies under the direction of the Electric Oversight Board.=018 I know what you are thinking right now. The next thing you know California will have regulated retail rates. That recipe should be out of the PUC=01s oven sometime next week. =01&Well the power marketers are jigging the system bidding up to the ISO=01s bid cap. There is no way you can tell me that a generator planned to make $750/MWH in its pro forma=018 Dave added. =01&So you agree with Herr (Hair) Peace! You don=01t believe in markets=018 I retorted. = =01&Oh I believe in them but I remember when I was short on a 300 MW trade and without any notice or advanced warning the price in the Midwest market went against me=018 Dave recalled. =01&I called everyone who I tra= ded with and they had nothing. I finally called XXXXX and I asked what will it cost for 50 MW?=018 =01&Why didn=01t you ask for 300?=018 I wondered. =01&I didn=01t want to= show him my position. You get hosed when you show the buyer your position. Ask for 50 first=018 Dave chided. =01&What happened?=018 =01&Oh they offered to sell for $150/MWH. I said I= =01d take it and then said I needed another fifty. He asked $300. I took that and he priced the next 50 MW at $600=018 lamented Dave. =01&He just wanted to see how far he could push me. That=01s what I mean when I say the traders are jigging it.=018 =01&But Dave you old communist your forgetting the trading function is what mitigates the risk. The traders are the in between people who guess at the price. Sometimes they guess right and sometimes they guess wrong. But the damage or the reward is on their book not passed on to the ultimate consumer. It has nothing to do with the marginal cost of a generating plant.=018 And there you have it. Put in a price cap and the traders have a target for which to shoot. I can=01t prove the following yet but I=01l= l wager with any of you that as the price cap level dips down the average trading price climbs even as the so-called =01&dysfunctional=018 price spik= es are eliminated. Consumers get hosed and the fundamental economic principle is upheld which is one can never be made better off with the imposition of an additional constraint. I feel better already. Here is what is on our short agenda this week. >>> Things in the Mailbag >>> Things in the People=01s Republic of California @@@ The ISO Replies to the EOB Report @@@ Reflections on a Day of Senate Hearings @@@ PUC Issues OII on Functioning of Wholesale Market >>> Odds & Ends (_!_) >>> Things in the Mailbag It has been awhile since we put the mail feedbag on and had a munch. Here is what my friends have been writing me. FPL Energy=01s Steve Ponder was only too quick to tell me =01&Please Gary= no more whining about your computer. How old are you?? Is this the year you get the AARP letter??? A very depressing moment. Do you really not know how to spell Morro Bay??? Please let us know what is going on with your son's hockey team?? Don't forget the cigars for Moron??? Bay!!!!=018 It is good to have friends like Steve. They make the pain of separation so much easier. And Steve when you FPL guys get that Entergy merger sorted out in a dozen years or so you let us know. I want to participate in the name selection for the new entity. How about Fentergy PLus? Next from the PX=01s Mark Hoppe who writes =01&As you've heard from others I don't know quite how you manage to knock out all this material each week. The burrito is informative humorous and usually contains a sprinkle of irony tragedy (ISO Drama). Though you are usually neutral regarding the PX you are not unduly negative which I appreciate. I think we do a pretty good job over here and so often people in the industry forget the amount effort and challenge it took the PX to successfully open this market.=018 Thanks Mark. I just want you to know that my ability to write this stuff every week is not constrained by the facts or evidence. I have learned from watching Herr (Hair?) Peace that as long as you can talk (write too) fast and have conviction in your statements regardless of how groundless they may be you will have a willing and eager audience. A few weeks ago I received from the PX=01s Jennifer Sherwood a note which she wants you to know are her opinions not necessarily the PX=01s. It=01s okay Jennifer. I paid Georgeyesterday the $20 I owed him for that sham Rose Bowl bet (remember? Stanford lost) and your opinions are cool with us. =01&Just curious - has anyone been comparing high unleaded prices to high CA electricity prices? What I mean is we are up in arms about how we should protect the unfortunate San Diego consumer who can't afford to keep the AC on. But what about the inflated unleaded gas prices the whole country has seen over the last few months? No effort is made by the government to shield the consumer from how much it costs to fill their gas tank. No mention is made of those who can't afford to drive to the grocery store because they can't afford the extra 15 or 20 cents a gallon. The costs are passed along to the consumer without pause. Granted there are differences between the unleaded market and the electricity market in terms of demand-side responsiveness but then again is it that much different to say =01+I can't drive today because gas is too expensive=01 vs. =01+I can't turn up the AC today because it's too expensive.=01=018 Finally from one of our [secret] Washington readers and I am not telling who I received the following: =01&I ... broke down and listened to the [ISO Governing Board] discussion and vote. Ugh! I too noted that the speak fast was applied to everyone but Herr Peace. My goodness what a mess we have. I loved Jerry's picture in USA Today -- it spoke volumes. My sources at FERC tell me though that we should keep an eye out for {FERC Chairman] Hoecker to do something really ... [Censored] ... for political reasons. Given no Commission meetings til September the only way to act is by unanimous consent so I would hope he can't do all that much.=018 >>> Things in the People=01s Republic of California @@@ The ISO Replies to the EOB Report Several of you people commented to me that the ISO=01s reply to the PUC/EOB report was very good. I decided to excerpt the best sections of it for the Burrito. The full document can be found on the ISO=01s website. =01&... the [PUC/EOB] Report asserts that the suspected activities of certain generators on June 13 created frequency instability leading to the Bay Area blackouts the following day. In fact the events of June 13 and June 14 were completely independent of one another. The voltage instability on June 14 was caused by system conditions on that day alone -- exceptionally high loads insufficient generation in the specific local area and transmission constraints that prevented the import of generation from outside the area. =01&The Report states that the ISO =01&never tried=018 to call upon consume= rs to reduce demand in order to avoid the Bay Area blackouts. In fact the ISO had in place on June 14 a number of demand response programs designed to reduce load including the Summer 2000 Demand Response Program under which customers have agreed through a prior solicitation to curtail energy use in exchange for a fee =01&The Report makes a number of assertions concerning the prices paid by =01+purchasers=01 of energy as a result of the recent price spikes (e.g. $= 1.2 billion in the month of June alone). These assertions leave one with the mistaken impression that these prices reflect amounts actually paid by the UDCs and/or passed through to customers. However in determining the total cost of energy one must determine the impact of any forward contracts entered into by the UDCs in advance of the wholesale energy markets. These contracts which are designed to =01&lock-in=018 a specific price in advance of real-time or near real-time market activities are specifically designed to mitigate the impact of price volatility and are standard in all commodities markets. We have reason to believe that some of the UDCs were substantially hedged during the period of the recent price spikes. =01&In a similar vein the reports asserts that California =01&might well= =018 have saved $110 million dollars had a $250 price cap been in place in May and June. This assertion assumes that all energy purchases would have been made at or below the $250 bid cap. In fact during times of peak demand when all of the state=01s generation has been exhausted the ISO competes with neighboring regions for available generation. In order to secure the necessary power the ISO must purchase on a bilateral basis this energy from resources located outside of the ISO=01s control area. =01&The Report asserts that California power markets =01&are not now competitive=018 and implies erroneously in our view that this is the normal state of affairs. It is not. The Market Surveillance Committee has noted that =01&market power in the California energy market appears to arise primarily during periods of peak demand=018 and warned that demand growth would increase the incidence of market power during the summer of 2000. =01&The Report asserts that the ISO is answerable only to a self-interested board and not to the citizens of California. This simply is not the case. The ISO is subject to the provisions of the Federal Power Act and to the rules and regulations of FERC which dictate in part that wholesale energy rates must be just and reasonable and in the public interest. The ISO further operates under a detailed tariff reviewed and approved by FERC. Every change to our market design and virtually every aspect of the ISO=01s business is subject to review and scrutiny by FERC. The FERC process provides substantial opportunities for input by the state agencies and such agencies have in fact been active participants in the FERC proceedings. =01&The Report asserts that California supply conditions have been affected by restructuring and that somehow the restructuring choices have made California more vulnerable to supply shortages. This assertion is unfounded. Significant load growth in California and neighboring states coupled with a lack of significant infrastructure investment in both generation and transmission have caused this vulnerability. Restructuring has increased proposed power plant applications many fold. Only by immediate and sustained attention to streamlining approval and siting processes for both of these critical infrastructure elements will this significant shortage be addressed.=018 >>> Things in the People=01s Republic of California @@@ Reflections on a Day of Senate Hearings If you want to imagine a scary sight imagine then twelve California legislators gathering together in one hearing room to rectify the wrongs of electric restructuring. Also imagine as if you are in the Twilight Zone witnesses that are slow on their feet and reckless in their facts. Then you get a glimpse of what yesterday=01s Joint Senate/Assembly hearing was like. It started over two hours late. The Senate was busy congratulating one of their own who is term-limited out next session and they wanted to heap on the glory. That said the show began with CEC Commissioner Bill Keese. Mr. Keese has one story and regardless how well he tells it and he does it is always the same story. It is the heat storm story. One can imagine in the heat storm story a lead character who is a single-mom call her Lady-Bird Bowen who travels across an angry land with her precocious pre-teen child Stevie Wonderboy. They are searching for electric power plants in the dessert which by the grace of God have been shipped to other countries which have more liberal returns on investment. Being the first speaker Mr. Keese took at least half the heat (storm) of the day. The rage of the Energy Fuhrer was palpable. Last week San Diegans shed 350 MW of load last week to save the entire system and did not receive one penny of compensation (I=01m not making that up ... He said it). He is sick of hearing about demand management as being a solution for the problem over the last five years and he is about done listening. People in San Diego are depressed by the sudden price hikes. Yikes! Keese did mention that the California reserve margin has sunk to 7% but in neighboring Arizona the reserve margin is -1% or -2%!! Mr. Keese correctly pointed out that electric power is not solely a California problem it is a regional problem. One member of the Committee asked what the legislature could do to speed up the power plant siting and construction process? Keese referred to Governor Gray Davis=01 Executive Order issued last week to which the CEC plans to respond soon date uncertain that lays out a 6 month permitting time line. The six months are enough if the applicant has the land secured zoning okayed transmission access and air offsets. Hmmmmmm. That alone might take six months before you get to the CEC. The next panel included Mr. Kahn of the EOB and Ms. Lynch. I went too hard on her last week calling her Let=01s Do Lynch. That was a 0.8 TPC. Sorry. I promise to be nicer starting now. The Energy Fuhrer instructed Ms. Lynch to use her authority to order SDG&E to divert the pass through of funds from the customers to the PX until the dysfunction of the market is cured. Put it in an escrow account. Ms Lynch promised to review this option at her August 21 PUC Meeting where she will enact SDG&E rate caps (told you). The star of the day I thought was FERC General Counsel Doug Smith. Mr. Smith comes to Sacramento. Isn=01t that a switch? Mr. Smith came in place of Mr. Hoecker thank the Lord. Mr. Smith put into FERC-eese what these 12 legislators could not get through their heads any other way. The 12 angry legislators were looking for a way for FERC to declare the wholesale market as non-competitive and then ask the generators to give back the money they over collected. When can we do that? Mr. Smith answered as only a FERC attorney can answer. There is a process. It takes time. You must have evidence. FERC uses a three-part criteria for assessing whether or not market based rates are allowable. It=01s based on market concentration and dominance not the existence of high prices. You would have to sue FERC in federal court and the best you could hope for is for FERC to reconsider its decision upon remand from the US Court of Appeals. Slowly the wind came out of the sails of the gang of 12. They were stumped. Herr (Hair?) Peace screamed couldn=01t you Mr. Smith of FERC today use your authority to declare the markets non-competitive that generators who had market based rates have exercised market power and retro-actively implement a $250 rate cap across the Western region? Like a wheezing accordion Mr. Smith played back and forth the familiar strains of music like a solo street musician on the corner. Back and forth: the process the process the process. There have been times in the past I hated the process at FERC. Today I have a renewed respect for what process affords me and you ... Freedom from the tyranny of a mob. For the remainder of the hearing they focused on remedies that could be undertaken by the PUC. >>> Things in the People=01s Republic of California @@@ PUC Issues OII on Functioning of Wholesale Market Well the official title is =01&Order Instituting Investigation into the Functioning of the Wholesale Electric Market and Associated Impact on Retail Electric Rates in the Services Territory of San Diego Gas & Electric Company=018. I like my title better. This Order or OII was issued at the last business meeting of the Commission on August 3. It calls for an investigation of the wholesale markets responses from the three UDCs and a pre-hearing conference in San Diego on August 29 at the San Diego Convention Center. Here are the questions the PUC wishes us to address: =01=07 What bill payment options should be provided to assist residential a= nd small commercial customers? (What does this have to do with the functioning of the wholesale market?) =01=07 Should SDG&E be authorized to participate in bilateral contracts or other supply procurement activities? How should the Commission assess reasonableness? Are SDG&E=01s purchasing activities serving its customers on just and reasonable terms? =01=07 What is SDG&E=01s obligation to minimize energy costs for its curre= nt customers? =01=07 How should the Commission Attorney General EOB ISO and PX coordinate to investigate wholesale market events behaviors and irregularities? How should state/federal concerns be addressed? =01=07 What are the causes of the price increases? Are anticompeititve practices causing some of the price increases? Are there mechanisms the Commission can employ to make ratepayers whole? >>> Odds & Ends (_!_) As promised last week I have a message from our event coordinator Barb Ennis regarding the upcoming WPTF General Meeting on October 5 and 6. Listen up! She writes: Hi Folks...... Well it is almost that time again....WPTF's October General Meeting will be held at the Inn at Morro Bay Sixty State Park Road Morro Bay California 93442. Their phone numbers are: 800-321-9566 or 805 772-5651. The dates are October 5th and 6th Thursday and Friday. The Inn at Morro Bay will also honor the same room prices if you choose to also stay WednesdayFriday or Saturday. We have blocked 24 rooms for October 5th. Which range in prices: Petite Room with Queen Bed $89. (16 rooms) Pool and Garden View with King Bed and Private Hot Tub $152. (4 rooms) View of Bay rooms with two (2) Double Beds $152. (4 rooms) All these rooms are on a First come basis. SHUTTLE Information: The San Luis Obispo Airport is about 25 to 30 minutes by shuttle NOTE: FOG CAN BE THICK AT THIS AIRPORT..FLY IN THE AFTERNOON ....... Ride-On Shuttle (805) 541-8747 Rates Door to Door are $22.00 per person for the 1st person and ONLY $2.00 per person afterwards....SO if some planning can be done on the Airline Arrival times through Barb and one person books the Shuttle for a Group....the cost is substantially lower. Now for(e) our Golfers....Tee times have been booked for Thursday October 5th starting at 8.07am 8.15am and 8.22am (space for 12 Golfers)..Sorry for the early morning start. The Golf Course has a Group going out from 8.30 am until 11.30am. The Golf Course is across the Inn at Morro Bay and your contact at the Course is Pat (805) 471-4360. For folks that may want to tour Hearst Castle is located only 30 minutes from the Inn at Morro Bay. Within walking distance of the Inn is a Natural History Museum a marina with kayak and canoe rentals. Shopping and dining along the Embarcadero and some great hiking. World class wineries and tasting rooms numbering over 40 are located within a short drive from the Inn. If you choose to drive it is 3-hours from San Jose American Eagle Skywest and United Express all serve the local Airport in San Luis Obispo. Duke Energy is willing to conduct a Plant Tour (A woman=01s only plant tour will be led by Duke=01s Carolyn Baker) if some may wish to do so. The sooner we can do the booking the better. So bring the Family and we are looking forward to seeing you at WPTF's General Meeting. Agenda for October General Meeting Thursday October 5 3:30 pm - 5:30 pm All Member=01s Meeting 7:00 pm - Dinner Reception (We are still working on the details) Friday October 6 9:00 am Opening Remarks and Program Irene Moosen - Distributed Generation Case at the PUC Bill Freddo - Confessions of a Merchant Plant Operator in New England ISO Dr.Frank Wolak - Topic of his choice Open Session - Everyone Gets a Chance to Speak Lunch provided at Noon. The object of humor notwithstanding and seeing how the flow of new material has slowed a bit my wife provided this week=01s laughter. She didn=01t have to attend the Senate hearing. Subject: The Brilliance of Women There were 11 people hanging onto a rope that came down from a helicopter. Ten were men and one was a woman. They all decided that one person should get off because if they didn't the rope would break and everyone would die. No one could decide who should go so finally the Woman gave a really touching speech saying how she would give up her life to save the others because women were used to giving up things for their husbands and children and giving in to men. All of the men started clapping. Have a great weekend y=01all [applause] gba What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Services briefing 8:30 at the Hyatt contact: Tom Schoeve x4830 Body:: You speak from 8:30 - 10:00 - Dogwood Room on the 3rd floor. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Dates for Emerson Meeting Body:: I'm suggesting that we make progress on it before we agree to a CEO summit Nate Ellis@EES 03/02/2001 02:01 PM To: Steven J Kean/NA/Enron@ENRON cc: Subject: RE: Dates for Emerson Meeting Agreed. It's great that these guys want to sell us product but what's in it for Enron? I'm already pushing that point with Emerson and will continue to do so. I definitely want to bring it up at the CEO summit. Thanks for your input Steve. Nate From: Steven J Kean@ENRON on 03/02/2001 01:16 PM To: Nate Ellis/HOU/EES@EES cc: Subject: RE: Dates for Emerson Meeting I think I can recommend that the time be set aside but it would be helpful if we pointed out to Emerson that it must be clear that there is a clear opportunity for Enron before we schedule the meeting. Maybe you could use this to get some progress on a bundled outsource deal. Nate Ellis@EES 02/28/2001 03:05 PM To: Marty Sunde/HOU/EES@EES Jeremy Blachman/HOU/EES@EES Michael Mann/HOU/EES@EES Troy Henry/HOU/EES@EES cc: Martin Wenzel/SFO/HOU/EES@EES Micah Hatten/HOU/EES@EES Joannie Williamson/Corp/Enron@ENRON Sherri Sera/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Subject: RE: Dates for Emerson Meeting Gentlemen: Situation: Emerson is aggressively seeking at least a three hour time slot for a meeting with Jeff Skilling in April or May 2001. Mr. Skilling's office is hesitant to allocate more than two hours without your recommendation. Emerson is being persistent. The key players from Emerson are David Farr newly appointed CEO and James Berges President and effectively the leader of Emerson's strategic development effort. It is anticipated that both would attend the meeting. Emerson execs want to (i) get to know Mr. Skilling and other senior management (ii) discuss mutual business opportunities and (iii) hold a discussion about the transformation of Enron from a pipeline company to its current form. The last point has to do with Emerson's continuing self-transformation effort and how Enron achieved its transformation. I need your advice and recommendation. Please respond by e-mail or telephone (x5-4040). Background: Emerson initiated this latest round of contact with Enron in November 2000 when Mike Train and Mark Proudfoot both Emerson VPs of Corporate Development visited the Enron building hosted by Steve Kean. I met them at that time. Since that initial meeting Emerson has aggressively pursued a business joint venture as preferred supplier with Martin Wenzel and the distributed power business I believe with promising results. My sense is that Emerson is uniquely positioned as EES' partner in that business. I am waiting to receive an update from Martin. Emerson is also interested in becoming a preferred supplier for EES's DSM business. While we generally support that idea we are pressing Emerson to reciprocate by becoming a customer of our bundled outsource business. Emerson is highly decentralized and our efforts to date have been unsuccessful. I want to use the meeting as an opportunity to press Emerson to consider a proposal from EES's bundled outsource business. Please let me know your recommendation on this matter. Thanks Nate ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Eeegads... Body:: I'll be there as will Sandi McCubbin. Are you interested in going? I thought not. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: NARUC Summer Committee Meeting Body:: Is Jeff available? ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: CONFIDENTIAL Information Request for Henry Bath US Body:: I do not have any of this information -- Cathy is the Metals plan the same as Enron domestic? If so then I would suggest that Chris Rahaim participate in this process. Feel free to work with me on it but I just don't have any data. Thanks. Michelle What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Crisis Update (No. 10) Body:: We have been pulling together these weekly(sometimes more often) summaries for internal purposes. Would you find it helpful to be on the distribution list? Hope you are doing well. Look forward to touching base soon. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: reply Body:: Michael It looks like we have sponsorship. Jeff Dasovich at Enron (GSPP ~'90) thinks he can get commitments from his company and others. He's excited about the idea. Severin Borenstein of Haas and UCEI and Frank Wolak at Stanford are very interested. When you return from vacation could we have a conference call with you me Jeff and whoever at the school might be involved to proceed with the plan? We were thinking perhaps a one day session in October with dinner the evening prior with a few panels featuring widely varying points of view. We'll need to figure out how to get press attention among other things if/when we talk. Enjoy your vacation. Thanks. Rob > What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Advisory board meeting Body:: While the more-open gas market may have more tools available than in electric markets market solutions have been proposed as an alternative to legislated rate caps in the hard hit San Diego market. Gavin -- please send Irwin copies of the articles on the offers made in San Diego. Stelzer@aol.com on 08/25/2000 03:14:04 PM To: skean@enron.com cc: Subject: Advisory board meeting The WSJ report of 8-23 on the power/price situation in Con Ed's territory contains the following: And the tools to hedge prices such as those that exist in other commodities markets aren't fully developed yet for th fledgling deregulated electricity industry. That might be worthy of comment in my talk. Anything I should see on the subject? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Follow up for Ken Body:: Rep Scott McGinnis (colo) told Ken that he would like to be briefed on the California and broader energy situation so that he can speak out on the issue. Also don't forget that we need to go see your buddy Newt! What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Markets Body:: nan What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL - Disclosure Schedules Body:: > Attached please find copies of the following schedules and annexes to the > Purchase and Sale Agreement: > > 1) the Master Parent Disclosure Letter > > 2) the schedules for India > > 3) the schedules for EGEP > > 4) the schedules for APACHI and > > 5) Annex G listing the contracts that have been excluded for > confidentiality reasons. > > Please note that the schedules for the SoCal assets will follow shortly > under a separate cover. In addition we plan to circulate copies of the > CALME and Wind schedules tomorrow. > > If you have any questions or any problems opening any of the attachments > please do not hesitate to contact either Gray Sasser at (713)758-3425 or > Donnie Roark at (713)758-3374. > > > > > > <> <> > <> <> < > > > +++++++++++++++++++++++ > CONFIDENTIALITY NOTICE > +++++++++++++++++++++++ > The information in this email may be confidential and/or privileged. This > email is intended to be reviewed by only the individual or organization > named above. If you are not the intended recipient or an authorized > representative of the intended recipient you are hereby notified that any > review dissemination or copying of this email and its attachments if > any or the information contained herein is prohibited. If you have > received this email in error please immediately notify the sender by > return email and delete this email from your system. Thank You > > - WORD v1 Summer Disclosure Letter.DOC - 00 India Schedules.DOC - 285641_1.DOC - Lightning-Schedules3.wpd - Annex G -- Excluded Information Based on Confidentiality Requirements.DOC What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: IHI Arbitration: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT COMMUNICATION Body:: Thanks. I have no idea why Enerson is being so panicky. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: House Energy Committee Passes First Energy Package Body:: Late this morning the House Energy and Commerce Committee adoped the committee print as amended of an energy package that addresses conservation clean coal renewables hydro nuclear and boutique fuels. The vote was 50 to 5 to report the bill. Other committees -- Ways and Means Science and Resources -- also moved their energy bills this week. Thus the House is on track to consider a merged package before the start of the August Recess on August 3rd. As to electricity during the several days of debate this week both Chairmen Tauzin and Barton reaffirmed their intention to next move to electricity issues. Mr. Barton's staff advised me this morning that the subcommittee he chairs will hold a hearing on Friday July 20th on all electricity issues other than transmission. While Mr. Barton has publicly held out hope of marking up an electricity bill this month sources on and off the committee do not see this timetable as realistic. On the Senate side the majority staff is working on an electricity white paper that may be circulated for comment next week. Below is a recap of action on amendments of interest to Enron: 1. Last night on a largely partisan vote (with Democrats Hall Green and John voting with the Republicans) the Committee rejected an amendment by Rep. Jane Harman (D-CA) (that was to have been offered by Rep. Anna Eshoo (D-CA)) that would have retroactively amended the FERC refund date and essentially ordered refunds regardless of amounts owed to power sellers. 2. First thing this morning the Committee again on a largely partisan basis (with Democrats Hall Green John and Towns) rejected a Waxman amendment to impose cost-of-service rates on all power in the West (other than generation added after 1/1/01). (Originally Mr. Waxman was going to offer amendment to impose cost-of-service rates only on those who do not supply all available power during an emergency but he ended up offering basically what he had pursued in subcommittee on the old Californa Only bill.) 3. The Committee adopted an amendment by Rep. Shadegg to amend the Natural Gas Act to make it clear that a natural gas transportation facility shall not be added to the National Register of Historic Places until FERC has abandoned the facility. Apparently there have been some instances of old pipelines being considered as historic places under federal law. The House Resources Committee added a similar amendment to its package yesterday. 4. By voice vote the Committee rejected a Waxman Amendment to require the president to propose and implement a plan to bring U.S. greenhouse gases down to 1990 levels. There was strong opposition voiced by many Republicans and Democrats to this amendment. 5. By mixed vote of 24 to 29 the Committee defeated a Waxman Amendment to set cost and performance goals for renewables including wind power and authorize federal funds to assist with commercial project costs (up to 50 percent). What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT COMMUNICATION Body:: Jeff & Sue -- We need to discuss at 9am your time (as well as other things). Jim What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: EES Video Body:: I am interested but it's probably more important that Jeff Dasovich and Sandi Mccubbin (in our SF office) know so that they can keep the politicos informed (and keep them from doing something stupid). Thanks Enron Energy Services From: Harold G Buchanan 08/03/2000 07:53 PM To: Steven J Kean/HOU/EES@EES cc: Kim Frumkin/HOU/EES@EES James M Wood/HOU/EES@EES Martin Wenzel/SFO/HOU/EES@EES Subject: EES Video Steve - I just saw your video and it is great - I think it will be released Wednesday on our web site and will be available to a very large group - Your comments will put the issues in SD in perspective. We have a team of six now calling the market in SD. If you'd like us to review our market plan in SD with you let me know. Thanks again for your time. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions - 09/17/01 Body:: What Now? --- Solutions Solutions: How California might get out of the mess it's in The Wall Street Journal 09/17/01 What Now? --- Looking to Washington: What can the feds do to make deregulation a less bumpy process? The Wall Street Journal 09/17/01 What Happened? --- Lessons From Across the Seas: Deregulation is working pretty well in Britain But it has taken a long time The Wall Street Journal 09/17/01 What Now? --- On Second Thought: In the wake of California's power problems many states are taking a wait-and-see approach to deregulation The Wall Street Journal 09/17/01 German Deal for U.S. Water Utility The New York Times 09/17/01 Germany's RWE Agrees to Buy American Water Works for $4.6 Billion Plus Debt Dow Jones Business News 09/17/01 INDIA: UPDATE 1-Enron's Dabhol says needs cash to pay lenders. Reuters English News Service 09/17/01 UK: INTERVIEW-Screen trading enhances metals market. Reuters English News Service 09/17/01 French Electricity Bourse To Run Tests Before Launch Dow Jones Energy Service 09/17/01 RWE to Buy American Water Works for $7.6 Billion (Update6) Bloomberg 09/17/01 Enron India Unit Serves Second Notice to Cancel Power Contract Blomberg 09/17/01 Energy (A Special Report) What Now? --- Solutions Solutions: How California might get out of the mess it's in By Jason Leopold 09/17/2001 The Wall Street Journal R14 (Copyright (c) 2001 Dow Jones & Company Inc.) Just about everyone has an opinion about how to solve California's energy problems. From building more power plants to capping prices to doing away with deregulation federal regulators consumer advocates economists and energy companies all have weighed in with plans for ending the electricity shortages and financial distress that have troubled the state over the past year. Here is a look at what some say California should do now: LEVEL THE PLAYING FIELD For many the solution to California's energy woes is to increase the supply of power in the state by building more power plants. A greater supply from more sources would bring wholesale prices down. And two California economists Severin Borenstein at the University of California's Energy Institute in Berkeley and Peter Navarro at the University of California at Irvine argue that the impact would be particularly pronounced in areas where electricity generators now have monopoly or near-monopoly power. We need to build more power plants in close proximity to the ones where companies have market power says Mr. Borenstein. The problem the economists say is that some areas of the state have only one power plant so the energy suppliers can manipulate the price by reducing output at a certain plant when demand is high in order to boost prices. California does get some power from generators in the Northwest and Canada. But because demand is so great in the state and throughout the entire region and supply is limited what is brought in doesn't make much of a dent. The economists add that because suppliers including Williams Co. Duke Energy Mirant Corp. and Enron Corp. have this freedom to charge whatever the market will bear they can take unfair advantage of consumers. For instance in Carlsbad a community in San Diego only one power plant owned by Duke Energy provides electricity to utilities in that area. The company has no competition so it has the ability to set the price for its power according to state Sen. Joseph Dunn a Democrat from Santa Ana who has set up a Senate committee to investigate manipulation in the wholesale power market. If you need electricity and there's only one place to buy it and everyone wants it you're going to pay through the nose says Frank Wolak an economics professor at Stanford University and the director of a power-market monitoring committee which monitors the wholesale electricity market to identify anticompetitive behavior. Is this fair? No. Something must be done about it. Duke Energy spokesman Tom Williams says the company denies that it has ever done this and rejects allegations that it has manipulated the price of electricity. Spokespeople for the other companies also deny such allegations saying prices have surged because demand has outstripped supply. Partly to prevent possible abuse of market power by suppliers the Independent System Operator which runs California's grid contracted with energy companies to have them operate some power plants as reliability must-run units. In return for a fixed annual payment from the state the companies agreed to make these plants available at a moment's notice to balance supply and demand. Electricity from the plants was priced based on the price of natural gas and other variable operating costs. In 1999 the ISO canceled two-thirds of the RMR contracts because the units were rarely called upon due to a steady supply of power in the state and the expense of the contracts to the state. When power prices surged in 2000 however the ISO didn't use the remaining contracts to help keep supply in balance and power costs down. An ISO spokesman says the agency doesn't have a reason to explain why the RMR contracts weren't utilized. He declined to comment further. CAP PRICES While many including Gov. Davis see more power plants as a long-term solution to the state's energy woes they advocate capping the prices of energy sold on the spot market as an interim solution to keep the market stable while the plants are being constructed. In the short term we need price caps Gov. Davis has said to state legislators. That means that [power generators] get all their costs back and a 40% or 50% profit which in this economy is pretty darn good. Robert Glynn chief executive officer of PG&E Corp. unit Pacific Gas & Electric which sold some of its generating plants during deregulation adds that price caps will keep wholesale prices low while new power plants are built. For more than a year the governor had urged the Federal Energy Regulatory Commission to place a temporary cap on electricity sold in the spot market saying the move would save the state's consumers billions of dollars on their energy bills while new power plants are being built. In May after many months of rejecting the idea the agency imposed an initial cap on prices in California during emergencies. In June it extended the cap to other Western states and established that it would remain in effect at all times. Wholesale electricity prices at first fell in response to the caps but surged again during a spate of hot weather in early July. FERC has been forced to make a number of adjustments to the cap as a result. These price caps however will expire in September 2002. Gov. Davis believes the caps need to stay in effect longer -- for three years -- to allow for the construction of new plants. RESTORE CREDIT-WORTHINESS Rebuilding a financial base for utilities is key to putting California's power market back on track. One way to do this some experts say is to let the utilities sell bonds to help them pay off debts and recoup the billions of dollars they've lost buying power at prices they couldn't afford. This would then allow the utilities to get investment-grade ratings. All California has to do is to ensure the utilities are credit-worthy again via the bond sale says John Bryson president and chief executive officer of Edison International the Rosemead Calif. parent of Southern California Edison Co. So far the California Assembly and Senate have proposed that Southern California Edison sell $2.9 billion in revenue bonds backed by a surcharge tacked onto the bills of the state's largest businesses to pay off its commercial paper holders and alternative-power producers such as wind and solar generators. The utility has a contract with the alternative-power producers and the price it pays for power is fixed. But the utility has defaulted on those payments. The state believes that Edison International needs to help rescue its struggling utility. A $400 million tax rebate that Edison International is expected to receive from the federal government also could be applied to help the utility out of its financial crisis. The state needs to provide some stability to Edison so we can get back in the power business again says Mr. Bryson. It's a pretty straightforward solution. While utilities still continue to deliver electricity to consumers the state has had to step in to buy the power on their behalf. Energy companies are currently refusing to sell power to the utilities fearing they won't get paid because the utilities have defaulted on prior payments and have no credit. California's 1996 deregulation law uncapped wholesale power prices but froze the rate the utilities could charge consumers. When wholesale prices surged in both the spot and day-ahead markets running well above what the utilities could charge customers the utilities couldn't do anything about it because the state deregulation law didn't allow them to sign long-term supply contracts. Restoring the utilities' credit-worthiness however may not be as quick as Mr. Bryson makes it sound given the huge sums that Southern California Edison and Pacific Gas & Electric owe the energy companies that sold them electricity. Pacific Gas & Electric filed for bankruptcy-court protection in April and is trying to write a reorganization plan in just six months pay off all of its creditors in full and return to the power business says the company's Mr. Glynn. CONSERVE ENERGY A massive conservation effort that busts the energy cartel by reducing demand and thus lowering the price of wholesale power is the only way to save the state in the short term says Harvey Rosenfield who heads the Foundation for Taxpayer and Consumer Rights a consumer-advocacy group in Santa Monica Calif. Only if demand falls so greatly that members of the energy cartel are forced to break ranks and lower prices will conservation solve the short-term problem. Gov. Davis says Californians already are conserving at a record rate. For example in July Californians boosted conservation efforts during the day by 11% compared with the same time last year. Conservation efforts have been suggested from the use of halogen light bulbs to running washing machines in the evening to setting the thermostat at 78 degrees. REREGULATE Nettie Hoge executive director of the Utility Reform Network a consumer-advocacy group based in San Francisco believes the state should return to the days when utilities monopolized the power market. Back then she says power supplies were abundant and prices preset. It was working just fine back then Ms. Hoge says. It's not until we opened this state up to so-called competition that everything started to go in the toilet. Look at us now: We're like a Third World country. We can barely keep the lights on. She says regulation would let consumers know what the price of electricity is and that price would stay the same regardless of fluctuations in supply and demand. California wouldn't be held hostage by out-of-state energy companies that not only control the price of electricity but also control the supply Ms. Hoge says. But some experts say that under federal law it might be impossible for states to reclaim authority over power plants that fall under the jurisdiction of the federal government. And it would cost billions of dollars to construct new government-owned generators or buy back with public funds old utility plants. LEAVE MARKETS ALONE Others believe that California's electricity markets should be left alone to evolve and become more competitive. The state should resist putting in constraints like price caps a number of Wall Street firms have advised the state. Merrill Lynch & Co. Credit Suisse First Boston and Goldman Sachs & Co. are among companies that helped the state and its utilities try to come up with financial solutions earlier this year to help ease the energy problem. None of the plans were implemented however. The state needs to get out of power business says Richard Cortwright an energy analyst at Standard & Poor's Corp. The goal of any new plan should be to eliminate what's left of regulation says Susan Abbott an executive director at Moody's Investor Service Inc. State regulators restricted the utilities from signing forward contracts [locking in power supply at a fixed price] they capped retail rates and never encouraged retail choice says Ms. Abbott. That's the antithesis of a competitive market. Until the state understands competition this energy crisis will just continue to fester for years to come. --- Mr. Leopold is chief of the Los Angeles bureau for Dow Jones Newswires. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. Energy (A Special Report) What Now? --- Looking to Washington: What can the feds do to make deregulation a less bumpy process? By Vasugi V. Ganeshananthan 09/17/2001 The Wall Street Journal R13 (Copyright (c) 2001 Dow Jones & Company Inc.) WASHINGTON -- Before California's energy problems began support was building for congressional action on national electricity deregulation. But this year says Sen. Frank H. Murkowski a longtime proponent support for deregulation is not there in my opinion. Still even without a comprehensive package the federal government could take some crucial partial steps toward more-open power markets. Some in Congress have backed measures that would lead to restructuring as opposed to deregulation. That could involve such steps as settling more authority on the Federal Energy Regulatory Commission to ensure reliability and access to the transmission grid. Another target for Congress will be the remaining antiquated laws and regulations designed for the days of monopolies when each utility had its own borders. The aim is to fix troubled wholesale markets to set the stage for states to elect to deregulate at the retail level. I think it would be in the industry's best interest for this Congress to deal with some of the issues that have been hanging out there for some time says Rick Shapiro managing director of local and governmental affairs at Enron Corp. the Houston-based energy giant. In Congress so far this year several bills have been introduced. The energy bill the House passed in early August offered some modest measures to foster competition such as tax breaks to utilities joining regional transmission organizations or RTOs which FERC has asked energy companies to create to operate the power grid. Rep. Joe Barton a Texas Republican and chairman of the House Energy and Air Quality Subcommittee plans to introduce even more restructuring legislation this fall. His bill may address reliability transmission and incentives for building power plants among other issues. And Sen. Jeff Bingaman of New Mexico chairman of the Senate Energy and Natural Resources Committee has plans for a bill of his own: His main point is to enhance FERC's authority to address power-market problems like reliability and fair access to the grid. But among other issues he is making the latest of several pushes over the past few years to repeal the Public Utility Holding Company Act of 1935 which was designed to prevent large national companies from dominating the industry. Though Congress in 1992 passed the Energy Policy Act permitting competition among wholesale electricity suppliers the 1935 law still limits certain investments by utility holding companies. And many say it impedes competition. Sen. Bingaman also wants to repeal the parts of 1978's Public Utility Regulatory Policies Act that mandate the use of renewable energy though he has said he still supports promoting renewable energy. Of course there are longstanding thorny issues that make federal action on energy markets a tough sell. While some Democrats like Mr. Bingaman are interested in the topic the party in general is less in favor of deregulation than are Republican lawmakers. Thus the recent Democratic takeover of the Senate is widely considered a setback. And while some regions strongly favor change others don't. For instance many Western states -- including Washington whose Democratic Sen. Maria Cantwell is a member of the Senate Energy and Natural Resources Committee -- are feeling the ill effects of deregulation in California and are thus leery. Naysayers point to what they say was FERC inaction regarding inadequate power supplies and controversial pricing auctions. From California's perspective FERC failed miserably by doing nothing for month after month after month says Rep. Henry Waxman a Democrat from California. I fear we might make the same mistake at the national level that California made at the state level. But deregulation advocates think nationwide deregulation is inevitable. Would you like to be in an airport where there is one airline from here to Atlanta? Or an airport where there are three airlines including a low-cost option? says Marc Yacker director of government and public affairs for the Electricity Consumers Resource Council a Washington D.C. group of large industrial electricity users. If regulated states see that residents in Pennsylvania and Texas have a well-functioning electricity system . . . they will change. Here are some of the main issues currently being hashed out in Washington: -- WHOLESALE MARKETS: Before any serious discussion of consumer deregulation can take place Mr. Bingaman thinks wholesale markets need to be fixed. Among his main points: clarification of FERC and state jurisdiction. A recent white paper from him outlining his planned legislation calls for Congress to clarify that FERC is the ultimate authority over all transmission issues with the power to overrule states. The paper adds Legislation should affirm FERC's authority to order utilities to join regional transmission organizations. Such powers the thinking goes would allow FERC to ensure that power transmission is fair and that access is free of any favoritism among affiliated utilities. And that would go a long way toward fixing wholesale markets and paving the way for retail deregulation should individual states choose to participate. To leave electricity legislation for another day would be to ensure that the problems faced now in the West will be replicated across the country he wrote in the paper. -- FEDERAL AUTHORITY: The extent to which a federal entity should have authority over power markets is a contentious issue. Mr. Bingaman desires far-reaching powers for FERC. And power suppliers favor having federal regulators hold sway over transmission issues. Eugene Peters of the Electric Power Supply Association a Washington D.C. trade group for competitive power producers says FERC has a role here in that they can essentially create a national template. Democratic Sen. Dianne Feinstein of California has also said she will push to get more authority for FERC in order to ensure that all power prices are reasonable -- for instance by assessing civil penalties to power suppliers who engage in unfair pricing. But some in the energy industry say FERC already has plenty of authority -- it's just that the commissioners haven't exercised it properly. Opponents of extending FERC's role fear a tangle of federal bureaucracy reaching a local level. I think that if FERC exercises the authority that I believe that they have in many of these areas legislation is not necessary says Dave Penn executive vice president of American Public Power Association a trade group of public utilities based in Washington D.C. FERC itself isn't arguing strenuously for more authority. Chairman Pat Wood says additional affirmations of authority would probably save the agency time in court later. And he says he wouldn't mind having the ability to assess penalties on utilities that fail to provide reliable service. But he adds While I welcome any authority they want to give us what we've got in the statute now is plenty good enough. -- TRANSMISSION: Transmission is an industrywide beef it's widely acknowledged that with electricity now being sold over greater distances the current system is overtaxed risking bottlenecks and reliability problems. So the nation needs more lines. But who decides where to put them? Plus with the same people selling power and running transmission lines there's a natural inclination for those controlling the transmission lines to want to sell their own electricity first. FERC has ordered the industry to institute RTOs to run the transmission system to ensure fair access to transmission lines no matter who owns them. Sen. Bingaman's proposals would affirm that power for FERC. And Mr. Wood says the RTOs can also handle siting of new transmission lines. But many states are unhappy with FERC's strategies. Some fearing federal interference with the states' authority over siting are taking steps to form their own multistate councils that would ensure regional cooperation while leaving control in state hands. And Maryland the District of Columbia and Virginia are requesting a rehearing of a FERC order that they join RTOs saying that federal regulators are moving with undue haste even in areas where transmission isn't a problem. -- INTERCONNECTION: In a competitive system the growing number of new electricity generators must be able to connect to the power grid. But the interconnection of new generators with the old utilities that own the grid's transmission lines can raise two kinds of problems. On the technical side newer generators can have different types of systems with different generating capacities raising concerns of overloads and other problems. On the competitive side utilities can make it difficult for new generators to connect to the grid. So many in the industry are calling for uniform technical standards to allow equal access to the grid -- once a generator meets the standards a utility would have no basis to deny a hookup -- and to ensure that interconnection doesn't risk the safety and reliability of the system. As we've moved into deregulation there are more entities that want to connect to the system says Ken Rose a senior economist at the National Regulatory Research Institute at Ohio State University. There must be some means he says to ensure that access for all these new players remains fair. FERC's Mr. Wood says interconnection is a top priority for the agency. He has officially asked utilities to file their interconnection rules and FERC will issue a policy on interconnection this fall. Chris Mele legislative director of the National Association of Regulatory Utility Commissioners in Washington D.C. says that interconnection rules need to be flexible. NARUC supports Congress requiring the establishment of national interconnection and power-quality standards that would be developed and adapted by an appropriate technical-standards organization says Mr. Mele. However the states need to have the flexibility to adapt these rules or to adapt their own rules. --- Ms. Ganeshananthan is a staff reporter in The Wall Street Journal's Washington bureau. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. Energy (A Special Report) What Happened? --- Lessons From Across the Seas: Deregulation is working pretty well in Britain But it has taken a long time By Geoffrey T. Smith 09/17/2001 The Wall Street Journal R9 (Copyright (c) 2001 Dow Jones & Company Inc.) LONDON -- For all those who just can't understand why electricity deregulation is worth bothering with: Look abroad. It has to be admitted that Europe's deregulation experience looks better than the U.S.'s largely because of the relative starting positions. Europe is the 300-pound couch potato who feels more of a difference after a month in the gym than the guy who is already quite fit. For decades the European electricity industry was run by engineers patronized by politicians. The result: a hugely overbuilt system with rows of underused power plants and legions of unnecessary staff paid for by sky-high regulated rates. Deregulation is starting to put an end to all that. Electricity prices have fallen in most European markets especially in Germany since a European Union deregulation directive took effect in 1999. And in the United Kingdom deregulation has gone further than in most of Europe. Electricity prices are down by around a third for families and businesses and there are few problems with supply. But there is a catch -- an important one for an American public already weary of the pain of deregulation: In Britain it has taken more than a decade to make deregulation start to work. Britain started out with a few advantages that places such as California don't have. Its policy is in the hands of a single central government committed to deregulation while U.S. state and federal regulators often disagree on what needs to be done. It started out owning the whole energy business and could carve it up as it pleased. As it deregulated it didn't have to face the problem of exploding demand due to Silicon Valley and rapid population growth. And Britain unlike California started from a position of significant oversupply and for years was liberal in allowing still more plants to be built because they would be fueled by cheaper and cleaner North Sea natural gas instead of coal. Despite all this British electricity deregulation has had its share of false starts. For 10 years up until 1998 the whole process seemed to be bringing little in the way of concrete gains. For much of the decade the government was a timid pioneer relying on the blunt policy instrument of price controls to bring prices down when its fancy new market models didn't work. But Britain was also willing to try different approaches if its first choice failed -- perhaps a lesson for the U.S. Like California Britain set up a wholesale pool for day-to-day power purchases Britain scrapped the pool when it failed to bring prices down. Britain also allowed power buyers and sellers the crucial freedom to lock in their prices for months ahead insulating them from the price zigzags that have crippled California's two largest investor-owned utilities and sent the biggest PG&E Corp.'s Pacific Gas & Electric Co. unit into Chapter 11 bankruptcy proceedings. The U.K. has got the balance about right but competition has been a long time in coming says Richard Lewis U.K. managing director of Enron Corp. Houston. The seeds were sown in 1988 when then-Prime Minister Margaret Thatcher decided to extend her free-market ideology to the electricity sector. The British government had a clear idea what it wanted to do. New laws were passed. Deregulation began. By contrast Germany's federal government which started the process at the end of 1998 has had to negotiate electricity deregulation with two other tiers of government and more than 800 electricity companies. Britain split the electricity sector into three parts: power generators completely separate regional suppliers and National Grid PLC to which it gave ownership and control of the country's high-voltage power lines. By separating the grid from the companies that actually sell and produce electricity this structure ensured that no seller could keep others out of the market. The government sold majority stakes in all 12 English and Welsh regional electricity suppliers to the public in December 1990. Six months later it had sold 60% each of National Power PLC and Powergen PLC giving to those two companies almost all the coal-fired power plants in England and Wales. The sale of nuclear generator British Energy PLC followed in 1996. Managers across the sector started cutting cut costs agressively especially for labor. With privatization the design of new plants was increasingly influenced by economic factors such as natural gas's cost advantage over coal rather than political ones. Back in 1988 Britain's old Central Electricity Generating Board had wanted to build expensive new coal plants and nuclear reactors despite the presence of vast untapped natural-gas reserves right on the U.K.'s doorstep in the North Sea. But thanks to privatization almost all the new power plants built in the next 10 years were gas-fired. In fact so many were built that the government slapped a moratorium on new plants in order to cushion if not stop the decline of the domestic coal industry. The moratorium was lifted last November. In the early 1990s a model evolved in which the companies that distributed power to homes and businesses -- known as regional suppliers -- were allowed to charge a specified amount for getting the power to the customer if a company could find a way to do it for less it got to pocket most of the difference. Customers got lower bills and the companies' shareholders were happy -- a little too happy in fact as the public started to resent the fat cat bosses who were seen as skimming off fat profits for little improvement in service. Deregulation really got going in 1994 when the government allowed industry to shop around for its power. A year later it gave up its rights to veto foreign takeovers of suppliers starting a wave of U.S.-led takeovers. But within a few years most of the U.S. firms had either sold or said they intended to although Dallas's TXU Corp. stayed and thrived. For much of the 1990s it wasn't market forces that brought British electricity prices down. Almost all of the cuts in prices to consumers came from [our] price controls on monopolies says Steve Smith head of trading arrangements at the Office of Gas and Electricity Markets the regulator that has implemented government policy under one name or another since 1990. Most of a household's bill comes from the cost of running the distribution network not from producing the power. It was this distribution part of the business that bore the brunt of the price controls. The failure to bring down the price of power itself threatened to provoke a crisis in 1998 when the government finally extended competition to the household and small-business sectors. Nine years after the Electricity Act got the ball rolling the market for customers was 100% open. But something still had to be done about the power generators' prices which weren't falling as expected. In theory British power generators had had to bid into a wholesale pool each day since 1990 telling the National Grid at what price each plant could supply power. The Grid would then buy as much power as needed from each plant starting with the cheapest. But the pool didn't work. There were too few players in it. The generators' prices to resellers -- the regional suppliers -- stayed stubbornly flat. Accusations of market manipulation abounded but could rarely be made to stick. The answer was NETA -- the New Electricity Trading Arrangements which were the centerpiece of last year's Utilities Act. Under the new rules which took effect March 27 electricity has become as close as it is ever likely to be to being a market like any other. Producers consumers and intermediaries now all trade electricity directly with each other up to 3 1/2 hours before they have to deliver or use it -- rather than buying power through an intermediary pool that buys from the generators. The grid operator still manages the physical flow of electricity but intrudes only inasmuch as buyers and sellers have to notify it how much they intend to put into or take out of the grid at each half-hour of the day. NETA has galvanized competition. Prices for electricity have fallen 15% since March according to British regulator Ofgem and they continue to fall. But it's not a question of forcing prices down -- more of allowing the market to set the price of power. More than 7.8 million customers have switched suppliers since 1998. And the Electricity Association a trade group for companies in the electricity business reckons that households can cut almost GBP 30 ($43) or about 12% off their annual bills by switching. At last deregulation is working. NETA has definitely been the right framework to foster competition says Brian Count the new chief executive of Innogy PLC a power generator and supplier that is one of two companies created last year by the breakup of the generation company National Power. But even as the free-marketers lean back and congratulate themselves on a job well done storm clouds gather on the horizon. The Labour government re-elected in June has ordered the U.K.'s first national energy policy review in 20 years. The government is signaling that it wants more control over future investment decisions. The nuclear industry and renewable sources such as wind power look likely to benefit as the British government tries to reduce greenhouse-gas emissions. As Britain's own natural-gas reserves run out in the middle of this decade it will become like the rest of Europe -- uneasily dependent on countries such as Algeria and Russia for supplies. Hence the support for nuclear power. The industry accepts all this but Innogy's Mr. Count speaks for many when he says: For goodness' sake don't let us now get dragged back to central planning and regulation. --- Mr. Smith is an assistant news editor for Dow Jones Newswires in London. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. Energy (A Special Report) What Now? --- On Second Thought: In the wake of California's power problems many states are taking a wait-and-see approach to deregulation By Eileen O'Grady 09/17/2001 The Wall Street Journal R13 (Copyright (c) 2001 Dow Jones & Company Inc.) California's energy crisis has a lot of people wondering whether it's really such a good idea to let consumers shop for electricity. No one wants to repeat California's mistakes. So while 12 states and the District of Columbia already offer residential and commercial energy consumers a choice of providers and a handful are pressing ahead with plans to fully deregulate next year some 20 others are either delaying deregulation plans or taking a hard look at whether they ought to move toward competition. And no state has started a new deregulation effort since California's blackouts and price spikes were first reported. But while the fervor for deregulation definitely has cooled not all of the blame can be laid at California's doorstep. Indeed in virtually all of the states that deregulated before California's troubles began -- particularly in Pennsylvania Massachusetts and New Jersey -- consumers have seen for themselves that many of the new entries in the power market haven't delivered on one of the new system's key promises: lower prices. Texas Michigan and Virginia are expected to stick to their plans to open their electricity markets fully next year. But industry sources agree that a lot more states would be about to do the same if California's electricity troubles hadn't given them second thoughts. The advance of retail competition has definitely stalled says Ken Rose a senior economist at the National Regulatory Research Institute at Ohio State University in Columbus a research arm of a national trade group for state utility regulators. The question is whether it reverses Mr. Rose adds. You would expect bumps in the road maybe a slow start but for the past year and a half it's not been going in the right direction. While no state has repealed an electricity-deregulation law in the wake of California's troubles seven states have altered their deregulation laws mostly to delay the start of consumer choice by a few months or a few years -- until state regulators and legislators can see how deregulation plays out elsewhere. Oklahoma one of those states pushed its shopping start date back to 2004 or later from July 1 2002 worried that deregulation might jeopardize its below-average electric rates. California has slowed down the restructuring effort but hasn't stopped it says Oklahoma state Sen. Kevin Easley a Democrat and an early supporter of deregulation. Long term we think it's still a positive thing for Oklahoma. As a major producer of natural gas Oklahoma has attracted a large number of new power plants that run on natural gas. Deregulation its local supporters say thus could help the state create new jobs by encouraging more local power plants that export electricity adding value to the state's natural resources. Nevada where electricity demand is growing dramatically used an emergency measure in April to delay the start of consumer choice for a third time. The measure also froze electricity rates until early next year and placed a moratorium on utility sales of power-generating plants. That effectively undid a customer-choice law passed in 1997 although the state will allow some large customers to shop for power next year. Wisconsin has no deregulation law but its utilities were beginning to propose ways to divide their power-generation assets in order to create a competitive market. When California's problems emerged however Wisconsin Public Service Corp. a unit of WPS Resources Corp. Green Bay withdrew a proposal that would have urged state regulators to allow the company to transfer some of its power plants to a separate company -- a first step toward deregulation. Wisconsin has been set back by California says Larry Weyers chairman of Wisconsin Public Service. Any talk of deregulation is met with a lot of opposition and anything seen as changing the system is dead on arrival. Our plan could have been successful but attitudes became cautious. So much for the states that got cold feet. How are the pioneers faring? Not very well. Most electricity customers in fully deregulated states have seen few competitive options. Figures from regulators indicate that after an initial burst of consumer interest new energy providers in New Jersey New York Massachusetts and Pennsylvania have seen significant reductions in numbers of customers. When New Jersey started letting consumers shop in 1999 about 2.2% of residential consumers switched to a new provider. Now only 1.1% are still buying electricity from a company other than their incumbent utility. Even Pennsylvania which was seen as the biggest deregulation success is beginning to look more ordinary says Mr. Rose the regulatory economist. Some electricity retailers that pulled out of the state blamed a climate of fear arising from California's troubles. But rising wholesale power prices have taken their toll as well says state consumer advocate Irwin Popowsky. In 1998 Pennsylvania residential customers had a choice of at least 30 alternative power providers. Today there are fewer than 10. The reason: The new entries proved unable to compete with the lower capped rates offered by the incumbent utilities industry sources say. Initially Pennsylvania's biggest utility Peco Energy Co. a unit of Chicago-based Exelon Corp. lost 44% of its industrial customers and 30% of its commercial clients to new suppliers according to data published by the state consumer advocate's office in July 2000. One year later however many of those customers had returned to Peco leaving the utility with a loss of only 4.7% of its industrial customers and 5% of its commercial clients. For residential power customers the story's the same: Around the state initially about 10% selected a new supplier before California's problems erupted. Today six of the state's seven original power companies have regained residential customers as competing suppliers leave the market and savings offered by those remaining shrink Mr. Popowsky says. The number of residential customers being served by new suppliers dropped to 574661 as of late June 2001 down 18% from March. It's a price issue says Sharon Reishus associate director at Cambridge Energy Research Associates Cambridge Mass. Though wholesale power prices have fallen since the first part of the year they remain unpredictable she says. A competing provider might be able to make profits say 10 months of the year but could still get killed in the spot market if prices spike Ms. Reishus says. One of the biggest new competitors in Pennsylvania is New Power Co. a subsidiary of NewPower Holdings Inc. Purchase N.Y. New Power bid for and won 250000 Peco Energy customers around the time of Peco's 1999 merger with Unicom Corp. to become Exelon. But New Power's plans extend well beyond the borders of Pennsylvania. It has plans to sell natural gas and electricity to residential consumers and businesses around the U.S. We have seen some volatility in the Pennsylvania market due to the rise in wholesale prices says H. Eugene Lockhart president and chief executive officer of New Power. But he adds we remain committed to serving our customers there and hope to step up our marketing efforts in the near future. But Houston-based Shell Energy Services a unit of Royal Dutch/Shell Group's Shell Oil Co. cited the slowing pace of retail access around the country for its recent decision to drop out of the hunt for new electric customers in Texas and Ohio -- even before markets in those states are fully open. Shell Energy Services had already signed up 40000 residential customers in Texas and 30000 in Ohio but officials said that given the slow progress of deregulation it was unlikely the company would reach the size needed to be profitable in a reasonable length of time. The prospects for selling power to residential customers remain difficult but the opportunity for marketing to business is brighter. Small businesses are seen as key for electricity suppliers seeking new customers says Scott Gahn managing director of commodity management at Enron Corp.'s Enron Energy Services unit which markets power to business. Each month that goes by we're adding gas and power customers in Maine Massachusetts New York New Jersey Illinois Ohio and Texas Mr. Gahn says. He even goes so far as to say that California's impact on deregulation hasn't been all bad. For energy markets in many states he says the California crisis has gotten the issue [of being able to choose your own provider] onto their radar screen in a way that you'd have to pay an advertising agency to do. State officials in Texas Michigan and Virginia where consumers will start shopping next year vow not to repeat California's mistakes. Everyone asks me will we have California's problems? says Tom Noel chief executive of the Electric Reliability Council of Texas which runs the state's power grid. No we won't have their problems but we will have some of our own. The Texas electricity market is very different from that of California. Texas has a copious supply of electricity thanks to extensive construction of power plants powered by natural gas which also is in plentiful supply locally. One reason California got into trouble: Its utilities had to import a lot of electricity and high-priced natural gas to meet the state's growing demand for power. Texas has attracted about two dozen companies to compete for consumers' business through a 1999 deregulation law that carved existing utilities into separate generating transmission and retail units. It has been running a customer-choice pilot program ahead of its Jan. 1 2002 debut of full deregulation. We're in this for the long haul says New Power's Mr. Lockhart. With the opening of the market in Texas there will be a national example of getting it right -- saving consumers money and giving them choices to help manage their energy use. --- Ms. O'Grady is a reporter for Dow Jones Newswires in Houston. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. Business/Financial Desk Section C German Deal for U.S. Water Utility By ANDREW ROSS SORKIN 09/17/2001 The New York Times Page 6 Column 3 c. 2001 New York Times Company In the first deal in the United States since the terrorist attacks of last week American Water Works of Voorhees N.J. has agreed to be sold to RWE a German utility for more than $5 billion executives close to the transaction said yesterday. The deal which is expected to be announced today before the markets open will be a crucial test of investor confidence in mergers and acquisitions in the wake of the calamity. One executive said the transaction was being announced now partly as an effort to demonstrate the resolve of businesses worldwide. ''We discussed holding off for obvious reasons'' the executive said. ''But we decided that we should press ahead. The markets need to know that business will continue as usual. And by that I mean business -- the commerce of life -- will not stop in the face of terrorism.'' For RWE the deal represents its latest effort to expand through acquisitions. Last year RWE acquired Thames Water of Britain and the E'town Corporation of New Jersey. American Water Works the largest publicly traded water utility in the nation with annual revenue of $1.4 billion has been acquisitive itself. It recently announced an agreement to buy the Azurix North America Corporation the water utility of the Enron Corporation and is about to complete a deal to buy the water assets of the Citizens Communications Company of Stamford Conn. Spokesmen for American Water Works and RWE could not be reached for comment last night. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. Germany's RWE Agrees to Buy American Water Works for $4.6 Billion Plus Debt 09/17/2001 Dow Jones Business News (Copyright (c) 2001 Dow Jones & Company Inc.) ESSEN Germany -- German utility RWE AG said it has agreed to buy American Water Works Co. the largest publicly traded water utility in the U.S. for $4.6 billion plus $3 billion in debt in attempt to expand internationally. RWE said it would offer $46 per outstanding share of American Water Works a 37% premium to American Water Works' share price in the past 30 days. The offer values American Water Works (AWK) at a total $7.6 billion as RWE will offer $4.6 billion for the shares and assume $3 billion in debt it said. Discussions between RWE and American Water had broken down late last month. When the transaction is complete RWE plans to bundle American Water Works which has a market capitalization of $3.3 billion with its Thames Water operations in the U.K. RWE said. RWE is looking to expand internationally to close the gap with competing global utility firms Vivendi SA and Suez SA both larger in size by market capitalization. Last year RWE bought Thames Water PLC of Britain and also acquired E'town Corp. of New Jersey. American Water Works Voorhees N.J. is an aggressive buyer in its own right. It recently announced the purchase of Azurix North America Corp. the North American water-services division of Houston's Enron Corp. for $141.5 million including $8.3 million of debt and tax savings of $13 million for an enterprise value of $136.8 million. It scrapped a planned acquisition of water utility SJW Corp. San Jose California earlier this year after repeated regulatory delays. And it is expected to complete soon a nearly two-year-old deal to buy the water and waste-water assets of Citizens Communications Co. Stamford Connecticut. RWE said shareholders representing 24% of American Water shares have already entered binding agreements to support the transaction. In addition to providing us with a top position in the U.S. the acquisition of American Water will further establish RWE as a global leader in the position of water services RWE Chief Executive Dietmar Kuhnt said in a statement. The development of RWE's world-class water business in turn will provide greater balance to our core utility portfolio and allow us to deliver enhanced growth and shareholder value he added. The deal is expected to be completed within 18 months to two years. The transaction will require shareholder and cartel authority approval. RWE's supervisory board and the board of American Water Works have approved the offer. Copyright (c) 2001 Dow Jones & Company Inc. All Rights Reserved Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. INDIA: UPDATE 1-Enron's Dabhol says needs cash to pay lenders. By Sriram Ramakrishnan 09/17/2001 Reuters English News Service (C) Reuters Limited 2001. BOMBAY Sept 17 (Reuters) - U.S. energy firm Enron Corp's Dabhol Power Co said on Monday it has sought urgent funding from its foreign lenders to repay interest on past loans and preserve a $2.9 billion power plant that is lying idle. Dabhol which is 65 percent owned by Houston-based Enron said monthly interest payments to its lenders have to be made in September but it does not have enough cash. It has about 25 foreign lenders which include ABN AMRO Citibank US Exim and Bank of America. The company has funds in its account to make certain payments and anticipates that some of those will be made. It has requested disbursement from banks towards the rest the spokesman told Reuters. He did not disclose details of the interest payments nor the cash it wants. The project has been funded 70 percent by debt. Dabhol has not been earning any income after its sole customer the Maharashtra State Electricity Board (MSEB) in May stopped buying any more power from its plant citing high tariffs. MSEB was buying the entire output from the plant's first phase of 740 MW and had committed to buy the second phase output of 1444 MW when it was ready. Following the cancellation foreign and local lenders stopped disbursals of around $400 million forcing complete stoppage of work on the second phase. They have also declined to provide funds to preserve expensive equipment from being damaged by natural elements. Without funds for preserving the facility the physical assets will begin to deteriorate almost immediately which in turn will further add to the overall cost of completion the spokesman added. Dabhol now wants at least a portion of this $400 million amount disbursed to help it meet its interest payments and take care of the plant. The development is likely to put further pressure on India's federal government to solve the contentious dispute which has affected the country's efforts to attract foreign investment in the power sector. Three foreign power companies have already pulled out including French giant Electricite de France . Analysts believe that a quick solution to the problem is key to restoring investor confidence. UGLY SPAT Once considered the showpiece of India's liberalisation programme the Dabhol project is now being dubbed an example of political and bureaucratic bungling. Enron has announced its decision to sell its equity in the project to the federal government or any other company. It says MSEB is yet to pay bills worth $185 million. On Monday Dabhol further upped the ante by slapping MSEB with two preliminary notices of termination. One is for not paying bills for the months of June and July and the other for MSEB's decision in May to cancel the power purchase agreement the contract that governs the state board's purchase of power from Dabhol. This is the third such notice from Dabhol. In May it served the first notice for non-payment of bills for December and January. The two fresh notices are a body blow for MSEB analysts said as it means the state utility could end up fighting three separate arbitration battles. According to the power purchase agreement all disputes will have to be settled by the International Court of Arbitration in London. As per this agreement serving preliminary notice is followed by a six-month cooling off period. If the dispute is not settled by then Dabhol can issue a final notice and the dispute automatically goes for arbitration. The six-month period for the first notice which was issued in May ends in November. If there is no settlement by then MSEB will have to answer Dabhol's charges of non-payment of bills for December and January. The same procedure will be followed in the case of the other two notices. But efforts to solve the issue so far through arbitration have been delayed by domestic litigation. MSEB wants the dispute to be heard by local courts while Dabhol is pressing for arbitration in London. The Bombay high court which began hearing this dispute on Monday is expected to give a final verdict soon. ($1=48.83 Indian rupees). Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. UK: INTERVIEW-Screen trading enhances metals market. By Martin Hayes 09/17/2001 Reuters English News Service (C) Reuters Limited 2001. LONDON Sept 17 (Reuters) - The emergence of electronic screen systems alongside existing open-outcry and telephone markets has enhanced trading in base metals Paul Shuman LME desk manager at Cargill Investor Services (CIS) said. From our perspective because we are brokers and do not run a proprietary position we are bound and always will be to try and get the best price for our customers. The more platforms there are for us to trade on the better for our customers Shuman told Reuters. The London Metal Exchange (LME) the world's leading non-ferrous metals market introduced an automated trading system (ATS) known as Select in February and unveiled a more sophisticated phase last week. The LME's system joined rival platforms managed by Spectron Metals and Enron Online part of Enron Corp. These systems have improved market liquidity and increased price transparency throughout the day Shuman said. Instead of being restricted to the ring and the telephone market where you have to ring around you have instant access to bids and offers all through the day. Now when we give our customers a market we can do that on the basis of the best bid and offer on the screen. From our company's perspective it has been very helpful he said. Spreads between bids and offers have narrowed and access to the market has become faster. It is certainly a tighter market a quicker market and probably a more liquid market he said. SCREENS NOT PARAMOUNT However the LME's ATS is not designed to replace open-outcry on the 124-year-old exchange. Rather it will complement the current mix of inter-office phone trading and open-outcry. Screens do not replace the ability to talk to one another he said. There are instances when customers needs to transact a highly complex multi-legged carry or spread trade and it is unlikely that any system will be able to replicate that. You phone up another broker and say what you want to do. You either have to do it face-to-face or on the phone - you cannot do it on the screen - speed is important. He said there may well be a fall-off in volume at one or other of the current platforms but the screens and the telephone market are likely to run in tandem while the LME plans to continue open-outcry ring trading as well. For the customers they are going to get the best of all worlds he added. LME SCREENS GAINING ACCEPTANCE On the screens the dust has still to settle between the rivals but there are signs that LME Select is being used more by the market. In the last few weeks Select has done better as more people have become used to it and it (Select) is free whereas some others are not Shuman said. And now the Select system is much more capable after the release of the second more sophisticated phase. It is very ambitious and it will be interesting to see how it works he said. The second release incorporates a unique request-for-quote function. This allows traders to direct enquiries such as market size and depth to as many or as few respondents as required and whether or not to be anonymous. It also covers all the LME's contracts - the initial release was confined to the basic cash three months and cash-to-threes spread contracts. It is going to take a while for Select Two to become the tool for the industry. But Cargill is in favour of anything that allows us to give a better service to our customers Shuman said. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. French Electricity Bourse To Run Tests Before Launch 09/17/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) PARIS -(Dow Jones)- French electricity bourse Powernext SA took one step closer to its imminent launch with the announcement Monday that it will host a series of simulations from Sept. 25. Powernext will stage three sets of simulations the first from Sept. 25 to Sept. 27 the second on Oct. 2-4 and the third on Oct. 9-11 Powernext said in a press statement. Close to 20 companies will participate in the tests including electricity suppliers traders the exchange's investors industrial consumers and traders. TXU Europe Energy Trading and Enron will be among the participants. The exchange is also holding seminars this week for participants to get acquainted with the ElWeb electronic trading system also currently used by Nord Pool in the Nordic region the market model and Clearnet the exchange's financial guarantor. Jean-Francois Conil-Lacoste Powernext's director-general said the exchange is still on track for its official launch later this autumn although a date hasn't been set yet. Euronext Paris SA and HGRT a financial holding for European electricity grid operators hold 34% and 17% of Powernext respectively. Currently Electricite de France (F.EDF) is the sole shareholder in HGRT although the long-range plan envisions Dutch grid operator TenneT and Belgian counterpart Elia as potential investors. Powernext aims to expand its activities in the Benelux region dovetailing newly created Euronext formed through a merger of the Paris Brussels and Amsterdam stock exchanges. Powernext will also announce later this autumn the addition of new investors. Currently the remaining 49% is divvied up among French banks BNP Paribas (F.BNP) and Societe Generale (F.SGF) plus state-owned EDF oil giant TotalFinaElf (TOT) and Belgian utility Electrabel (B.ELE) which each hold 9.8%. These stakes will fall to 5.0% with the entry of the new investors the threshold necessary to hold one seat on the board of directors. The exchange plans to initially offer physical electricity in hourly blocks for delivery the next day. Separately EDF Trading the London-based trading joint venture of EDF with commodities trader Louis Dreyfus will start trading in the French wholesale market Oct. 1. EDF's Director of Client Services Loic Caperan said last week. EDF Trading is barred by the European Union Competition Authority from trading in the French retail market. The trading arm isn't allowed to assist EDF to structure contracts for France's energy-intensive industrial consumers the group eligible to choose suppliers representing about one-third of domestic power consumption. But the entry of EDF Trading into the wholesale market is viewed by some traders as crucial to injecting necessary liquidity for electricity trading to flourish in France. The pace of power market deregulation is slowly starting to pick up in France. Powernext is the second project to launch this autumn aimed at kick-starting trading. Last week EDF auctioned options on close to 1200 megawatts of local power production. As the E.U.'s second-largest power market which shares its borders with five countries and is connected to the U.K. via an under-water electricity interconnector France is key to the eventual formation of a pan-European traded market. -By Sarah Wachter Dow Jones Newswires 331-4017-1740 sarah.wachter@dowjones.com -0- 17/09/01 09-56G Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. RWE to Buy American Water Works for $7.6 Billion (Update6) 2001-09-17 07:02 (New York) RWE to Buy American Water Works for $7.6 Billion (Update6) (Adds where American Water is based in second paragraph moves stock drop to seventh adds context in third paragraph.) Essen Germany Sept. 17 (Bloomberg) -- RWE AG Europe's No. 4 power company agreed to buy American Water Works Inc. the biggest publicly traded U.S. water utility for $7.6 billion in cash and assumed debt in a bid to catch up with larger rivals. RWE is offering $46 in cash per share 35 percent more than last Monday's close for the Vorhees New Jersey-based company. Germany's RWE will assume $3 billion of American Water's debt said Chief Financial Officer Klaus Sturany on a conference call. The purchase will add more than 10 million U.S. customers to RWE's water unit and further reduce its reliance on the German electricity market. It will also help RWE narrow the gap to Suez SA and Vivendi Environnement SA a year after Chief Executive Dietmar Kuhnt spent $9.8 billion on Thames Water Plc of the U.K. ``RWE has said it wants to expand in water and this is another step in that direction'' said Ulf Moritzen who helps manage 100 million euros ($93 million) at Nordinvest. ``In the current situation it makes sense to buy a defensive business.'' The planned purchase isn't cheap. Including debt RWE will pay about 5.4 times sales for the U.S. company compared with 4.9 times sales for Thames Water. In the U.S. buyers paid about 4 times sales for the 15-plus takeovers in the country's water industry over the past two years according to Bloomberg data. Stock Drops Including pending acquisitions by the U.S. company the price will rise to about $8.4 billion by closing said Sturany. RWE will sell an unspecified amount of new bonds to finance the purchase he said without giving a time frame. RWE shares fell as much as 2.27 euros or 5.5 percent to 38.90 euros in Frankfurt. They've declined 17 percent this year. American Water shares closed at $34.12 last Monday the last day U.S. markets were open before the terrorist attacks. The acquisition is the biggest announced since terrorists attacked the World Trade Center and the Pentagon last Tuesday. Sturany said the companies reached an agreement last week though they decided to delay the announcement because of the disaster. ``We have enormous confidence in the U.S. economy'' Sturany said. ``Despite the enormity of the events we expect the U.S. market to prevail.'' He said the contract with American Water doesn't include any special clauses related to the attack. After the purchase which may take as long as two years to complete the Essen Germany-based company will have 56 million water customers worldwide according to spokesman Bill McAndrews. Suez and Vivendi each serve more than 100 million people. More Purchases Sturany said American Water which will become a unit of Thames Water will expand further in the U.S. by using the German company's ``strong balance sheet.'' The Thames Water purchase last year gave RWE New Jersey-based utility E'town Corp. RWE said the new acquisition will make it the largest water company in the U.S. the world's biggest single market. American Water has customers in 23 U.S. states the German company said. The U.S. market with more than 54000 local utilities is ``ripe'' for consolidation he said. RWE today said the latest purchase will help boost earnings before goodwill in the first year after completion. The company had sales of $1.35 billion last year and employs 5000 people throughout the U.S. RWE's total debt will rise to about 8 billion euros ($7.4 billion) after the purchase Sturany said. RWE's debt-to- equity ratio was about 2.8 before the purchase compared with 41 times for Vivendi Environnement according to Bloomberg data. The yield on RWE's outstanding 6.5 percent 20-year bond rose 0.1659 or 0.2 percent to 100.0455 after the announcement. RWE in April sold 3.46 billion euros worth of bonds to help pay for Thames Water including 350 million pounds in 20-year bonds. RWE has an ``Aa3'' rating from Moodys' Investors Service and a ``AA-'' rating from rival agency Standard & Poor's. Merrill Lynch & Co. and Morgan Stanley Dean Witter advised RWE on the U.S. purchase. Goldman Sachs advised American Water. RWE said 24 percent of American Water's shareholders are already backing its takeover offer which has also been approved by the German and the U.S. companies boards of directors. Enron India Unit Serves Second Notice to Cancel Power Contract 2001-09-17 08:50 (New York) Mumbai Sept. 17 (Bloomberg) -- Dabhol Power Co. Enron Corp.'s Indian unit said it has served a second notice on the state-owned Maharashtra State Electricity Board stating that it will start proceedings to cancel its power supply contract because its waiting to be paid past dues. Enron owns 65 percent of Dabhol Power Co. which runs the $3 billion power plant India's biggest foreign investment. It is owed $64 million by the Maharashtra State Electricity Board its sole customer in unpaid bills for 9 months. The board in May stopped buying power saying it's too expensive. ``Little progress has so far been made on reaching a fair and reasonable solution'' to the payments dispute the company said in a statement. Enron on May 19 issued the first notice to cancel the power supply contract with the board. It began looking to sell its stake in the project after the negotiation panel failed to get other buyers for its power. Eight Indian states said they would buy electricity but at less than half the price charged by Dabhol. Enron said it has invested $875 million in the project and is ready to sell to the government its stake at cost. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I am having lunch on Monday with Michael Isikoff a newsweek investigative reporter. He is doing yet another Ken Lay/Enron political influence story. One of the things he wants to talk about though -- and I think this is a good sign -- is Enron's climate change policy and how it compares to the administration's. What I need from you as soon as possible is a timeline (what the Administration said when -- doesn't have to be down to the day) the Administrations position and our position (and how they differ). Borrow heavily from existing materials. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FERC course on for Thurs, July 26, 1-4 p.m. Body:: Great news. With respect to the Commissoners I think it makes sense to go back through Ellen and ask if she could set up meetings with a few commissioners ater the staff briefing. wgramm on 07/17/2001 03:23:19 PM Please respond to To: Jerry Ellig Steve Kean cc: Susan Dudley Subject: FERC course on for Thurs July 26 1-4 p.m. Susan got it done -- it'll be Thursday July 26 1-4 p.m. at FERC (a room on the 3rd floor?). Susan has talked with Bill Albrecht. He'll probably be coming in on Wed. p.m. Steve any ideas about a Commissioner strategy? (invite them to attend if the FERC folks agree ask the FERC folks to do the inviting ask the FERC folks to help set up meetings afterwards or a follow on if they like what we do and think it useful for Commissioners try to do a walkaround -- that is offer to have Jerry Bill Susan visit commissioners individually Friday a.m. after the course or Thursday a.m. before the course?) Wendy Wendy Gramm Regulatory Studies Program Mercatus Center George Mason University 703-993-4884 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Moving foward at a good clip Body:: Steve Good news. As you indicated would happen Kalen Pieper called me mid-week. We had a very good conversation about EES and Dave Delainey's leadership. She explored my views about doing business with government. Shortly thereafter Dave's office called to invite me to Houston on Thursday July 26. Kay Chapman explained that Dave's schedule would keep him out of pocket until August 16. In order to move forward Janet Dietrich will be meeting with me when I go to Houston next Thursday. (I must confess that after all the great things I have heard about the man I do look forward to meeting Dave himself.) Is there a time next week that I can speak with you by phone to fine-tune my thinking / preparation for Thursday's meeting with Janet? Thank you for your all of your help. I am pleased and appreciative that things are moving forward at a good clip. Kevin Contact Information E-mail kevinscott@onlinemailbox.net Phone (213) 926-2626 Fax (707) 516-0019 Traditional Mail PO Box 21074 ?Los Angeles CA 90021 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Enron Mentions Body:: Thanks for the note. Jim Hughes asked the same question you did. Here is my (and John's) response. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Comments on NERC Legislation Body:: Attached below are the Enron comments submitted to NERC and the other parties involved in the NERC-led discussions on reliability legislation. The comments indicate that Enron does not support the final version on which comments were requested by today. The comments as submitted were reviewed by Jim Sarah and Charles and reflect their suggested changes. Thanks to them for their assistance. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Risk 2001 Australia Body:: Philip Please try Frank Wolak from Stanford University. He is the best expert on California right now. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: New Orleans - ""Day of the Trader"" - McGraw Hill conf - Ron Dionne is the contact - Kathleen is doing this Body:: Sunday through Tuesday What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: MEC Body:: Start with Joe hillings in DC To: Steven J Kean/HOU/EES@EES cc: Subject: MEC Steve What are your thoughts on public subsidies/tax breaks for MEC? Who should I contact to discuss the possibilites for some tax advantages on new facilities? Thanks Mark What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EES Staff Meeting, in 746 Body:: Ralph Reed--get back to him (second week of Oct) Paul Carrier 202-586-5659 Phil Sharp 617-495-1363 496-6335 617- 495 1364 Slides for QBR re project Balboa What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Thanks for your time this morning. Body:: Aruna No address was attached. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Alhamds Presentations Body:: Offer him the job. Rob Bradley@ENRON 07/25/2000 12:40 PM To: Steven J Kean/HOU/EES@EES cc: Andrew Miles/HOU/EES@EES Subject: Alhamd's Presentations FYI--go to the Internet Strategy one for what you need. I am pretty sure he will work out with me and Jeff--you can pull the trigger and hire him with my concurrence if you feel comfortable enough. - Rob ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ENE Officer Elections Body:: We should include David Oxley -- VP of human resources. From: Kelly Johnson/ENRON@enronXgate on 07/18/2001 11:13 AM To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Subject: ENE Officer Elections Steve: Please review the attached ENE Officer list for your direct reports and approve. Thank you. Kelly M. Johnson Enron Corp. Executive Assistant Tel: (713) 853-6485 Fax: (713) 853-2534 E-Mail: kelly.johnson@enron.com What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: DPC - strictly confidential and privileged Body:: In the three years I have been here I am unaware of an ENA/ECT bad faith claim against any insurance company. Anyone else? If so please contact Michelle. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: DRAFT EDITORIAL: Enron is Committed to Floridas Energy Future Body:: I think it starts off a bit too hot. I would pull up some of the arguments you make about the need for additional supply and the importance of electricity to our way of life. I'd then go into a discussion of the debacle in the West (and how they are now playing catchup - with loud polluting diesel generators ... as was reported today). Then I'd go into how our plants in Florida represent a very reasonable inobtrusive solution for Florida. From: Eric Thode/ENRON@enronXgate on 05/24/2001 09:07 AM To: Steven J Kean/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON cc: Subject: DRAFT EDITORIAL: Enron is Committed to Florida's Energy Future In support of of our three power plant proposals in South Florida I have written an editorial for distribution to South Florida newspapers including the Sun Sentinel and Miami Herald. Additionally we would distribute it to a number of small city papers including the Pompano Pelican Deerfield Times Pompano Times Deerfield Observer etc. Needless to say no decision has been made regarding releasing it. I would like your input on the subject. If we decide to proceed our goal would be placement during the first week in June leading up to the next round of Commission hearings which are scheduled for June 6 8 and 12. Please provide comments to me at your earliest convenience. If you have any questions please call me at ext. 3-9053. Thanks. Eric What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Firsst article attached refers to the 1946 Nebraska case I mentioned to you= =20 in DC What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Conference call with Stan Horton, Terry Thorn, Joe Hartsoe, Cynthia Sandherr - Re: Democratic opening for FERC Commisssioner, in Stans office, EB 5023 Body:: Ashok? Maureen Palmer -- Voltage upgrade issue What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EGEP Sale Announcement Body:: print What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Speaking Engagement Body:: MARC Conference per Iowa Commissioner Emmett George 8:30 Sue Landwehr will meet you at the hotel for breakfast 10:30 - 12:00 Power Supply and Transmission Lunch at 12:00 at conference Irene Baeg 515-281-8644 Afternoon fly to DC What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - Calif Peaking Plant Body:: Phil-- Enron is currently evaluating the possibility of installing an NGL peaking facility with appurtenant storage and rail facilities near Needles California. Ideally the plant would inject / vaporize normal butane at the rate of 18750 gallons per hour into a high pressure natural gas transmission system. Current gas pipeline specs are as follows: Operating pressure - 850 - 1000 psig worst case 750 normal range 800-900 Gas Volume - 650000 - 750000 MMBtu/day Expected normal butane (GPA spec) requirement - 450000 gallons/day (18750 gal/ per hour) My questions are: 1) Is anyone currently using butanes for peaking service and if so where? 2) Do we need to blend with air (how much) or can we inject straight normal butane? 3) At what line pressure point do the butanes re-liquefy further downstream of the injection point as the pipeline pressure falls? 4) Is this peaking plant configuration feasible and if so at what price (ball park here don't go way out of your way)? (If it's not what would your suggestion be for a design). I will fax you the normal butane specs as soon as I get them (please email back your fax number). As always we're on a pretty tight time frame. After you've had a chance to review the above I'd like to get together and discuss this with you. I can meet you in Ohio if it fits your schedule better just let me know. Thanks for the help and I look forward to talking with you soon. Kevin Hyatt 713-853-5559 kevin.hyatt@enron.com What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Presentation at ETS HR Employee Meeting Body:: Thanks. I was glad to do it and would do it again... next time my computer will work. I benefitted a great deal from what I heard from the group especially regarding the PRC. Roger Sumlin 03/23/2001 09:34 AM To: Steven J Kean/NA/Enron@Enron cc: Gary P Smith/OTS/Enron@ENRON Wilson Barbee/HR/Corp/Enron@ENRON Brian Schaffer/Corp/Enron@ENRON Ann Vaughn/HR/Corp/Enron@ENRON Fran Fagan/OTS/Enron@ENRON Subject: Presentation at ETS HR Employee Meeting Steve . . . FYI -- we conducted a post-event survey on opinions about the HR employee meeting held last month and the HR management team thought you should know that participants rated your presentation very high. When asked what should be kept the same next time participants commented as follows about your presentation: I think a presentation from Corporate HR is of great value. Keep the presentations by the officers . . . to talk about the business. I liked having other people from ETS/Enron there to better understand the big picture and where Enron is going. Continue to bring in invited guests to keep the group apprised of Corporate activities. I liked the opportunity to hear both Stan and Steve--the field staff don't get as many opportunities to hear from corporate management. Visits by Steve Kean and Stan Horton. Their perspectives are very good . . . Clearly your participation provided much value to the group and we appreciate very much your taking the time to come meet with us and share information. You should expect that we'll be asking you to come back again! Regards - Roger What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: RGA request Body:: Just a heads up ... Ken may get a call from Gov Gilmore regarding the Republican Governors' Association. Below are Sue Landwehr's recommendations (with which I concur). Let me know if he calls and let us know if you need any additional information. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Portland General called. They have heard that Defazio is going to propose in a press release that the state of Oregon should buy PGE. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Some Background on California Gas Price Spikes--The Other Side of the Story Body:: We need to communicate with Massey before he gets completely carried away blaming the interstate pipeline business for gas price spikes. We need to get him the information regarding Cal LDCs failure to fill storage and their opposition to additional pipeline construction in the state. Shelley -- could you forward copies of the LDC filings to the group. Should Joe or I (or both) try to see massey when I am in town next week? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Job Description Revised Body:: I'm afraide this leaves too much room to manuever. Having duties related to setting legislative affairs strategy and developing a plan for contacts on the Hill will give Cynthia the idea that she can run all aspects of those duties not just those related specifically to her substantive area. I think it is also worth covering the heavy emphasis on teamwork and supporting rather than directing others in the organization. Richard Shapiro 08/02/2000 04:17 PM To: Gwendolyn Petteway/HR/Corp/Enron@ENRON cc: Steven J Kean/HOU/EES@EES Subject: Re: Job Description Revised Good to go. Gwendolyn Petteway@ENRON 08/02/2000 04:07 PM To: Richard Shapiro/HOU/EES@EES cc: Subject: Job Description Revised See attached email with revised job description for Cynthia Sandherr. ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Thanks & Questions Body:: I enjoyed talking with you the other day and am happy to answer your questions: both the Texas position and the Washington DC position report to Rick Shapiro. From a government affairs standpoint I've divided the world between Rick's group (the Americas) and Mark Schroeder's group (Europe and Asia). Both Rick and Mark report to me. Joe Allen continues as part of the Texas legislative team working for the head of that group (formerly Kathleen Magruder). Terry Thorn has taken a commercial position in Enron and no longer works on government affairs issues for the company (except to the extent we call on various executives to help from time-to-time). Untermeyer Chase on 08/31/2000 04:53:09 PM To: 'skean@enron.com' cc: Subject: Thanks & Questions STEVE: I very much appreciate your call the day before yesterday and your asking if I would like to compete to succeed Joe Hillings as head of Enron's Washington office. Although until that moment I hadn't thought of returning to Washington except to serve again in national office I would be pleased to talk further about this opportunity with you or your recruiter. In recalling our conversation I realize that twice you asked if I had any questions and if I had been quick to take advantage of your offer I would have asked how government relations are handled at Enron. To whom does Joe Hillings report: to you or to Terry Thorne? You mentioned a woman who currently has responsibility for government relations in Texas and some neighboring states but is leaving for another job at Enron to whom does she report? Then there is Joe Allen whom I have known since our days in the Legislature doesn't he (also) handle Texas affairs? I am sorry I didn't ask you all this on Tuesday. Whatever the answers it's clear that government relations are much more central to the work of Enron than at Compaq which is why it would be a very exciting place to work. Thanks again for your call your courtesy and your indulgence with this tardy line of questioning. With best wishes CHASE. CHASE UNTERMEYER Director of Government Affairs Compaq Computer Corporation P.O. Box 692000-110706 Houston Texas 77269-2000 Tel: (281) 518-1093 Fax: (281) 518-1106 chase.untermeyer@compaq.com What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Decision 00-08-037 (Signed 8/21/00) Body:: ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EPSA Meeting On RTO Legislation Body:: We had a positive result in the EPSA Legislative Affairs Committee meeting yesterday afternoon. The EPSA staff draft of a letter to Barton on his RTO discussion proposal will be significantly strengthened and EPSA staff will start by incorporating the comments I sent over earlier in the week. The original draft said the Barton RTO language only needed technical corrections. EPSA staff reiterated that some member co. or cos. think Barton's draft could have been worse. My reply was this logic was like saying we should be grateful he shot us in the head instead of hanging us -- one method may be more humane but either way we are dead (OK the analogy may be too rough -- but it made the point.) (I subsequently confirmed that Reliant is the soft member -- their rep. told me they support the discussion draft although they wouldn't object if it is strengthened.) A stronger EPSA letter with more specific reasons why we oppose the Barton discussion draft will be circulated among EPSA members today or Monday with the goal of sending the letter first thing Tuesday when Congress returns. Some wanted a general letter requesting a meeting and deferring specific comments until the meeting. I pointed out that Barton is speaking to subcommittee members right now and that we needed to copy them on a more detailed letter ASAP so they hear from us before Barton gets to them. We will make the same contacts ourselves. In fact we have already started. Spoke to Reps. Chip Pickering and Rep. Greg Walden both subcommittee Republicans this week (did same with staff to Rep. John Shimkus). Key task when House staff return to work on Tuesday will be finding out where Ranking Member Rick Boucher is on the Barton RTO draft. Barton implied at a conference earlier this week that he and Boucher are in agreement on RTOs. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Washington DC - Council of the Great City Schools Body:: 2:00 - 5:00 Secretary Reilly will speak just before you. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Dinner Body:: Steve I am in London this week. Let's connect when you come back. Vince What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I got a voicemail response from Jeff - he is fine with me substituting for him on the Japan trip. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FERC investigation Body:: Have we suggested to FERC staff that they force the ISO and PX to open the blackbox to show how they determine dispatch? In addtion if you are not on the distribution list for Belden's memo on utility behavior in California this summer I will forward it to you. It suggests some other areas FERC ought to be looking into. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Revised Merger Release & Q&A Body:: fyi What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Western Interstate Energy Board Body:: Committee on Regional Electric Power Cooperation in Tempe AZ What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Management Conference - Hyatt Hill Country Resort, San Antonio Body:: Fly to New York late. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Washington DC to meet with Northwest Delegation. Starts at 9:30, should be over at 11:30. Body:: 2:30 - 3:30 Jim Ciconni - Enron 4:45 Fly to Houston What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: NewPower Withdrawal Notes Body:: How about inserting the attached (after the explanation about the relationship between New Power and Enron)? Binky Davidson@EES 03/15/2001 05:35 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: NewPower Withdrawal Notes Mark Muller sends the attached for your information and comments. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Recap of House Action Last Night on Energy Package Body:: Late last night the House on a 240-189 vote passed as amended H.R. 4 -- the Securing Amerca's Future Energy (SAFE) Act of 2001. Here is what happened on the three amendments of interest to Enron: 1. The House overwhelmingly defeated (154 to 274) a Waxman Amendment (D-CA) to impose cost of service rates on wholesale sales of electricity in the WSCC for 18 months. Only three House Republicans supported the amendment (all from California -- Gallegly Issa and Hunter) 57 Democrats opposed the Waxman Amendment including all of the Texas Democrats EXCEPT Frost Hinojosa Rodriguez and Doggett (these four SUPPORTED the Waxman Amendment). Thus our collective lobbying efforts in recent months focusing on California Republicans Texas Democrats and other moderate Democrats worked out in the end. 2. The House also overwhelmingly defeated the Cox Amendment (R-CA) to grant California a waiver of the Clean Air Act's oxygenate requirement for reformulated gasoline. The vote was 125 to 300 (44 Republicans 80 Democrats and 1 independent voted for the amendment 173 Republicans 126 Democrats and 1 independent) voted against it. 3. The House also defeated the Green Amendment (D-TX) to repeal the Natural Gas Act's Hinshaw Exemption as it applies to California's intrastate natural gas pipelines. The vote was 154 to 275 (123 Republicans and 31 Democrats voted for it while 95 Republicans 178 Democrats and 2 independents voted against the amendment). Please call or e-mail with comments or questions. The Senate Energy Committee is starting its work this week on an energy package with consideration of an R&D title (other issues will be taken up in September including electricity). The House Energy and Commerce Committee will now turn to electricity issues with staff drafting during the August Recess hearings in September and votes on legislation in September or early October. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Video for Management Conference Body:: I'd love to but I'll be in London Marge Nadasky@ECT 10/11/2000 12:01 PM To: Robert Horton/HOU/ECT@ECT Mark Frevert/NA/Enron@Enron Andrew S Fastow/HOU/ECT@ECT Ken Rice/Enron Communications@Enron Communications Kevin Hannon/Enron Communications@Enron Communications Karen S Owens@ees@EES Thomas E White/HOU/EES@EES John Sherriff/LON/ECT@ECT Steven J Kean/NA/Enron@Enron Mark Koenig/Corp/Enron@ENRON Cliff Baxter/HOU/ECT@ECT Cindy Olson/Corp/Enron@ENRON cc: Cindy Stark/Corp/Enron@ENRON Karen Owens/HOU/EES@EES Bridget Maronge/HOU/ECT@ECT Maureen McVicker/NA/Enron@Enron Dorothy Dalton/Enron Communications@Enron Communications Carol Ann Brown/Enron Communications@Enron Communications Jennifer Burns/HOU/ECT@ECT Susan Skarness/HOU/ECT@ECT Joannie Williamson/Corp/Enron@ENRON Judy G Smith/HOU/EES@EES Bobbie Power/Corp/Enron@ENRON Subject: Video for Management Conference You recently received an e-mail from Terrie James regarding a video we are working on for the upcoming Management Conference. We have been able to lock in a date and time to do this taping on Thursday October 19th from 4-6 p.m. We are still working on the location for this taping but plan on this taking place in close proximity to the Enron Building. Can you please let me know if you will be available to participate in this group session? If not we will be following up with some individual taping the week of the 23rd. If you have questions feel free to contact Terrie James on Ext. 37727 or myself on Ext. 36631. Marge Nadasky What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Video Tape Body:: I'll send it back on Tuesday. Jose Bestard@ENRON_DEVELOPMENT 02/18/2000 08:02 PM To: Steven J Kean/HOU/EES@EES cc: Maureen McVicker/HOU/EES@EES Subject: Video Tape Steve. Did you get a chance to look at the video tape I gave you? I would like to have it back to show it in Brazil Thanks Jose What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Body:: Anne Thanks. I shall join. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: WSP: Market Ripe for Manipulation... Body:: Cc list suppressed... Public opinion is the pendulum that swings law...dsg August 4 2000 Deregulation Leaves Electricity Market Ripe for Manipulation by Power Firms By REBECCA SMITH and JOHN J. FIALKA Staff Reporters of THE WALL STREET JOURNAL It's a market ripe for manipulation: surging demand for an indispensable commodity weak oversight and a chaotic new set of rules amid a transition from heavy regulation to open competition. This is the state of the U.S. electricity business in the summer of 2000. And sure enough there's growing evidence that some power companies are finding lucrative ways to exploit the system -- at consumers' expense. The tactics include manipulating wholesale electricity auctions taking juice from transmission systems when suppliers aren't supposed to and denying weaker competitors access to transmission lines. None of this is illegal and much of it might be considered basic competition. But as an electricity shortage plunges sweltering California into an energy crisis and fears of even worse shortages rattle the Northeast the practices of power suppliers face more scrutiny than ever. (See related article.) Steamy Conditions A hot summer day last year shows one kind of manipulation. On July 28 1999 wholesale electricity prices in the Middle Atlantic states hit $935 per megawatt hour. That was seven times what it costs to generate power at the most expensive plant in the region. An analysis of trading data from that day shows that PECO Energy Corp. and PPL Corp. the old Philadelphia Electric Co. and Pennsylvania Power & Light made the most of steamy conditions. In the region's power market deregulated in 1997 a new corporation called PJM Interconnection LLC runs the transmission system once operated piecemeal by eight utilities. It also operates a daily electricity auction that sorts the hourly bids of 540 generating plants. The cheapest plants are called on first but when the weather is hot and demand is acute higher offers are taken as well. To attract as many bidders as possible the highest bid each hour sets the price for the entire market for that hour. Grid and Bear It Rise in average wholesale electricity prices at key transmission-interconnection points for the month of May from 1997 to 2000. TRANSMISSION-INTERCONNECTION POINT % CHANGE 1997-2000 Texas +293% +216 Tennessee Valley Authority +165 California-Oregon border +162 New York-West +138 Chicago area +130 New England +117 New York-East +101 Upper Midwest +99 Florida +89 Mid-Atlantic region +80* *Includes only years 1999-2000 Source: Federal Energy Regulatory Commission RDI Power What PECO and PPL did was offer much of their output at low prices so that the majority of their plants would be called into service. But knowing demand was so high they offered power from their tiniest plants at vastly higher bids in a way that often set the peak price for a number of hours. Consumers that day ended up paying millions of extra dollars for power. Cases like this show that during the transition to deregulation there's a good argument the system has broken down says William Massey a commissioner at the Federal Energy Regulatory Agency. FERC which polices the nation's bulk power markets began the deregulation movement in 1996. It wasn't supposed to be this way. In the old days utilities generated electricity and delivered it to customers in exclusive territories. To protect consumers from gouging rates were regulated. But while supply had to be able to meet peak demand at all times demand varied widely within regions between regions and from one season to another. The result was tremendous reliability but also inefficiency and waste. Deregulation now under way in half the country and functioning nationally at the wholesale level allows new players -- some affiliated with utilities some not -- to build power plants and sell electricity. Prices are supposed to be set by competitive markets. Risks are borne by investors not ratepayers. At the same time utilities are surrendering control of long-haul transmission lines to new nonprofit operators like the one in the Middle Atlantic region which are supposed to ensure fair access to the grid -- the multistate system of high voltage lines. Under this new regime energy prices should have dropped as companies raced to compete with one another. But the massive U.S. energy infrastructure wasn't designed to serve as the backbone of a free market. On hot summer days when there's little or no surplus electricity in the nation's most populous regions generators can charge prices far in excess of their production costs and be confident they'll get tapped for service by grid operators who must keep the lights on at any cost. Utility holding companies that still control transmission lines have an added advantage: They can effectively lock out cheaper competitors. California Cuts Price Cap for Electricity Once Again (Aug. 2)Price Cap Is Set for Electricity That Is Sold in New England (July 27)PPL KeySpan Say Earnings Surpassed Wall Street Targets (July 27)Energy Trading Internet Operations Help Enron's Net Income Jump 30% (July 25)PG&E Posts 36% Rise in Net to $248 Million (July 21) The new regional grid operators called independent system operators or ISOs eventually will be in charge of preventing manipulation. But as nongovernmental organizations they won't have basic investigative tools like subpoena powers or the ability to impose significant penalties. FERC which does have those powers rarely uses them preferring to let the market discipline itself. A Strange Drop Sometimes it's difficult to know what constitutes an abuse of the market. In July 1999 engineers noticed that a substantial amount of power was being taken from the grid for which there was no explanation. They contacted the North American Electric Reliability Council the industry group charged by Congress with overseeing the grid since the late 1960s. After a lengthy investigation NERC determined that Cinergy Corp. a utility holding company had surreptitiously taken enough power over a three-day period about 9600 megawatt hours to light a small city for a month. Cincinnati-based Cinergy had underestimated power demands. Rather than buy electricity on the open market at ferociously high prices or cut power to Cincinnati it quietly borrowed power from the system when demand was peaking and later replaced it in the cool of the night when demand wasn't so high. James E. Rogers Cinergy's chief executive received a letter from A.R. Garfield the chairman of NERC's regional power-coordination center accusing his company of showing blatant disregard for the rules and of using the grid as a supplemental resource without regard to the reliability or integrity of the system. But Cinergy paid no fine. That's because it runs its own transmission control area and is trusted to enforce NERC's voluntary rules even when it is the violator. Smaller utilities in Cinergy's area by contrast face contractual penalties of as much as $35000 per megawatt for unilaterally borrowing from the grid a practice known as leaning on the ties. Dancing on the Edge? Mr. Garfield is still steamed about Cinergy's actions which he said removed part of the system's essential reserve needed to avoid cascading blackouts or a chain of uncontrollable outages that could darken whole sectors of the country. How fair is it that someone can dance on the edge like that and get away with it? he asks. Mr. Rogers points to old rules that permit utilities to temporarily borrow small amounts of power during emergencies. We were very careful to make sure when we leaned on the ties ... we didn't bring the whole system down he says. Nevertheless he concedes in a competitive world those rules need to be changed. The region's regulators have since gone to FERC for authority to charge borrowers for the market value of the electricity they take off the grid. Leaning on the ties is only one way fair competition is being frustrated on the country's transmission system a vast web of connections that resembles the nation's highway system before the construction of the interstates. While there are plenty of routes to get electricity from outlying power plants directly to big cities there are relatively few routes connecting regions. That makes it possible for some big companies to shut out competitors. A Snag in Transmission St. Louis-based Aquila Energy hit that snag when it tried to use a transmission corridor owned by New Orleans-based Entergy Corp. to move electricity to a buyer in East Texas. Entergy granted the request initially but then it canceled saying it didn't have sufficient space on its lines. Aquila didn't buy it. After analyzing transmission-capacity data the company argued to FERC that Entergy did have enough space on its lines and so was in effect breaking a rule that required it to provide transmission-line access when possible. Without access to Entergy's lines Aquila was forced to compensate the buyer and lost nearly $300000 on the deal. From whom did the Texas customer end up buying the power? A unit of Entergy -- and for a higher price than it would have paid Aquila. FERC said Entergy had been within its rights to restrict access in this case because it had transmission problems. But FERC found that Entergy on other occasions had hoarded transmission capacity that should have been made available to the market. Entergy declines to comment. Such scenarios are costly for consumers and they are among the reasons the electricity industry is enjoying flush times. In the second quarter just ended companies ranging from AES Corp. in Arlington Va. to Enron Corp. in Houston reported huge profit increases some as much as 50%. To be sure a lot of those profits are coming from extraordinary demand growth and a pickup in energy trading. But Sean Murphy president of Southern Energy New England a unit of Southern Cos. Atlanta Ga. worries that the industry has gotten too greedy and risks retribution. Pigs get fat but hogs get slaughtered he says. Tremendous Volatility New federal data show that average wholesale power prices have more than doubled at 14 of 17 key pricing points across the country in the past three years. By May of this year prices had risen across a broad range -- by 89% in Florida for example and by 294% in Texas. But even these increases mask the tremendous volatility that has struck all the major wholesale markets during the past year. In the case of the Midwest where prices in July 1999 hit $9000 per megawatt hour it was as if a $1.89 gallon of gas suddenly sold for $567. Prices like these have prompted growing calls for investigations into whether electric companies are gouging their customers. Some consumer groups lukewarm to deregulation in the first place now are agitating for re-regulation. Residential electricity bills have doubled in San Diego which is notable because it's the first city in the nation to be served by a utility that's buying all of its energy on the competitive market. Politicians are sounding the alarm in the Pacific Northwest. There wholesale prices peaked at a record $1300 per megawatt hour during the last week in June. Energy-intensive industries like mines and aluminum smelters are cutting back on production and temporarily laying off workers. We may be seeing too much opportunism in the market says Montana Gov. Marc Racicot. Demands by Mr. Racicot and his counterpart in Washington Gary Locke were instrumental in prompting FERC to open a national investigation in late July into possible market abuses. A Six-Month Lag One big premise on which deregulation rests is that a free flow of information will let markets police themselves and operate efficiently. But a key tool for market monitoring the data on utility Web sites used to book transmission orders is often unreliable. There's a six-month lag on the release of bidding data which are coded to mask the identities of bidders. What's more the four FERC-controlled ISOs operating in California the Middle Atlantic states New England and New York don't have the authority to compel market participants to give them internal documents like bilateral contracts and other information they don't want to hand over. Without such documents there's a lot more looking than finding says Bill Museler chief executive of the New York ISO. Even if the ISOs do find something problematic there isn't much they can do about it. The tariffs contracts and bylaws under which they operate generally prohibit them from releasing company-specific data and so exposing wrongdoers. And with the exception of California the ISOs' own board meetings are closed to the public. The reality is confidentiality rules protect the guilty says Frank Wolak a professor of economics at Stanford University and chairman of the California ISO's Market Surveillance Committee. And there are no codes of conduct to instill a sense of fair play. That can be a huge problem on hot days. In California an independent exchange runs a daily forward auction in which it tries to match the next day's anticipated demand to bids by generators. But this summer generators often have offered less power than they know will be needed so that they can submit higher bids later when the ISO is forced to pay stiffer prices for emergency power. On occasion ISO engineers have had just 40 minutes to frantically phone around and nail down suppliers knowing that if they fail they could be forced to begin rolling blackouts. The bidding strategy while legal undermines reliability and forces the ISO to do some real gymnastics says Kellan Fluckiger chief operations officer for the California ISO. Generators say they aren't to blame for the mad scramble. Utilities buying power for their customers often order less power than they really need for fear that a big order will drive up the overall market price to prohibitive levels. The only real recourse available to the ISOs is to rewrite the rules governing their local markets. But FERC is reluctant to let them meddle too often because generators are investing billions of dollars based on existing market rules. There's another reason too says Ron Rattey a veteran FERC economist who in June wrote a 10-page internal memo criticizing the agency for not doing more to ferret out unfair conduct. Every single ISO has identified strategic abuses he says. And every time the ISOs make adjustments to the rules the market participants find new ways around them. Write to Rebecca Smith at rebecca.smith@wsj.com and John J. Fialka at john.fialka@wsj.com What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Congressman Ose loved your letter to Sen. Dunn Body:: ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: HR Functional - Mid-Year 2001 PRC Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: First Cut at High Tech Messages Body:: Looks good. I think you implicitly say this but I think you should make it more explicit: The continued growth of the new economy is threatened by our electricity infrastructure more than anything else. The high tech industry requires market driven solutions to reliability and pricing not the old style command and control regulated monopoly approach. Let's start getting the word out! Jeff Dasovich Sent by: Jeff Dasovich 09/26/2000 02:06 PM To: skean@enron.com Richard Shapiro/HOU/EES@EES Sue Nord/NA/Enron@Enron Margaret Carson/Corp/Enron@ENRON Rob Bradley/Corp/Enron@ENRON mpalmer@enron.com Karen Denne/Corp/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON James D Steffes/NA/Enron@Enron cc: Subject: First Cut at High Tech Messages Attached is a first rough cut. Work continues but wanted to distribute for feedback. All is welcome and appreciated. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: European Trip Report 22-30 Jan 2000 Body:: Is Catherine working on environmental policy related to sustainability or is she working on greenhouse gas transactions . . . or both? ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: The Dutch power market situation: STRICTLY PRIVATE & CONFIDENTIAL - ATTORNEY - CLIENT PRIVILEDGE Body:: Richard Following our coversation of yesterday I set out for you below the following: 1. An explanation (in draft) of the Dutch power market and the events leading up to the current market squeeze by certain players which we have produced and discussed for our external lawyers. 2. A schematic of arguments which we produced for external lawyers before Christmas just relating to the mis-application of capacity by TenneT. 3. A copy of our e-mail to Clifford Chance of last Wednesday summarising the issues in order of priority for their advice. Please note that purely on the swap element of this jigsaw we are attempting to arrange a conference with a Queen's Counsel for next Monday afternoon. Hence it may be better for our meeting (with Jeff patched-in) to take place next Tuesday - clearly the advice on all the elements involved (as set out in 3) in toto will not be complete until we have had the conference with the QC. I am due to receive tomorrow however from Clifford Chance their legal strategy report on all the other issues raised in my e-mail (item 3) and shall forward you a copy on receipt. Kind regards Mark ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: Western Wholesale Activities Conference Call - Gas & Power Date: Today and Every Thursday Time: 1:00 pm Pacific 3:00 pm Central and 4:00 pm Eastern time Number: 1-888-271-0949 Participant Code: 936022 In Ray's absence I am facilitating today's call. The proposed agenda (Item numbers refer to the proceedings document row number): Electric 1. Responses to ISO and CA utility RTO filings due June 19 (item 9a) 2. ATC Complaint - next steps (item 20) 3. RTO Seams Conference 6/19/01 and request to speak due tomorrow 6/8/01 (item 37) 4. ISO withholding of as-bid and OOM price data 5. Generator data requests - (Hatsoe) Gas 6. Response to FERC to Re-Impose Transportation Price Caps (item 36) 7. Quarterly reporting requirements (item 35) 8. Gas-related data requests (item 33) What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: EBR Mtg and Pre-Mtgs. Body:: You should plan to be there. Michael Terraso 09/22/2000 06:12 PM To: Steven Kean cc: Subject: EBR Mtg and Pre-Mtgs. Steve am I not to attend the meeting with Lay and Skilling on Oct 4? Mike ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Talking Points For Rep. Barton On Tauzin RTO Letter Body:: Linda requested some background and talking points on the pending RTO letter from Chairman Tauzin to FERC that is sitting on Chairman Barton's desk TODAY for his decision whether to co-sign the letter. While we have not seen the text we are told that it is anti-RTO and may go so far as to state or imply that FERC does not have authority to do what is doing with RTOs. (We know this is the view of one of Chairman Tauzin's counsels who formerly worked for Southern Co.). Chairman Tauzin has been contacted by Entergy and the Louisiana Public Service Commission to send the letter. I spoke to Chairman Barton's staff Andy Black this afternoon and relayed our concerns. The Barton Subcommittee is now expected to mark up an electricity bill in December (per a Republican Member meeting held this morning). ACTION ITEM: Call Rep. Joe Barton (202/225-2002) TALKING POINTS: 1. Should start with something about the Dynegy/Enron transaction (it will be strange if Mr. Lay or Steve calls Chairman Barton and does not start the conversation with some reference to the transaction). 2. Mentioning the transaction naturally leads into the importance of competitive wholesale markets for power both for consumers and for the largely Texas-based marketing trading and merchant power industries. 3. We understand that Chairman Barton has been approached by Chairman Tauzin about a letter to FERC on the RTO issue. We know Chairman Barton is well aware of Enron's strong support for FERC's RTO initiatives. We respect Chairman Barton's interest in seeing to it that Congress does not abdicate its responsibility to make energy policy. 4. If as we have been lead to believe the letter states or implies that FERC does not have authority to act in the RTO arena this will be seen as a potentially destabilizing development since FERC is so far down the road of creating RTOs. 5. While we understand some in Congress and elsewhere were concerned that FERC was moving too fast as of the last FERC meeting earlier this month that is no longer true even if it ever was true. While we think RTOs should be created sooner rather than later FERC is listening to state regulators and others who had concerns. 6. A letter from congressional leaders questioning FERC's authority goes too far in the direction of those who oppose any RTOs. Furthermore it is wrong as a matter of law. The D.C. Circuit held in the gas cases and in the power cases on Order 888 that FERC has authority to address systemic discrimination which is in large part what the RTOs are all about -- a remedy for discrimination. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Refund Cases Timelines--Confidential Atty Client Work Product Body:: The prehearing conference in the CA case was an interesting proceeding. It= became very apparent that the ISO was primarily responsible for the delay = in producing data. The parties complained that they had not received what = the ISO had promised. The PX complained that they had received NO reliable= data from ISO (it was riddled with errors) and that they were at the same = point as at the beginning of the entire proceeding. The PX needs the ISO d= ata in order to commence generating the data that the PX itself needs to pr= oduce. In any event the new delayed schedule is a positive development. = It is noteworthy that we were able to group consideration of refunds issue= s and offsets to refunds on the same date- October 26 (previously refund te= stimony was considered first and testimony related to possible offsets to = refunds was considered on a subsequent date). This is very positive since = it reduces the chance that the proceeding will be only about refunds and th= at the offsets issue will be marginalized. Ray Alvarez What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Telephone Interview with The Enron Corp. Research Group Body:: Ms. Crenshaw Thank you very much for the message. I am very interested in the opportunity to talk to personnel from the Research Group at Enron. Between the two days you suggest I prefer Wednesday 12/6. Considering the two-hour time difference between California and Texas 11:00 am Pacific time (1:00 pm your time) seems to be a good slot. However I am open most of the day on 12/6 so if some other time slot is prefered on your end please let me know. Thanks again. I look forward to talking to you and your colleagues. Jingming On Tue 28 Nov 2000 Shirley.Crenshaw@enron.com wrote: > Good afternoon Jingming: > > Professor Wolak forwarded your resume to the Research Group and > they would like to conduct a telephone interview with you sometime next > week at your convenience. The best days would be Tuesday 12/5 or > Wednesday 12/6. > > Please let me know which day and what time would be best for you and > they will call you. Let me know the telephone number that you wish to be > contacted at. > > The interviewers would be: > > Vince Kaminski Managing Director and Head of Research > Vasant Shanbhogue Vice President Research > Lance Cunningham Manager Research > Alex Huang Manager Research > > Look forward to hearing from you. > > Best regards > > Shirley Crenshaw > Administrative Coordinator > Enron Research Group. > 713-853-5290 > > > Jingming Marshall Yan jmyan@leland.stanford.edu Department of Economics (650)497-4045 (H) Stanford University (650)725-8914 (O) Stanford CA 94305 358C Economics Bldg If one seeks to act virtuously and attain it then what is there to repine about? -- Confucius _?OO??OOo? ?T=15xO-?? -- =14?? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Draft of California Contact List Body:: Please respond to kevinscott Steve This is a draft of the contact list I promised you. There are still some typos in it. I will clean them up and get send you a draft in the morning that is ready for circulation. This list is made up of people that I know and trust. By an large I have excluded sitting pubic officials. In cases where a given organization has several useful contacts with similar knowledge I have listed just one person for now. Give me a call at your convenience and we can discuss this in great detail. Kevin 213-926-2626 - Kevin Scott - Key Contacts - Draft.doc What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: ticket Body:: 6011 3000 5062 8237 12/02 What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: confidential (client-attorney) Body:: ----------------- What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: One more thing... Body:: Please handle ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: See natural gas price article below. Our buddy Paul Carpenter has turned o= n=20 us (not to mention that he seems to be talking nonsense). How about giving= =20 him a call? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Amendment of the CPUC subpoena for production on June 4 with mont hly updates, and clarification on confidential treatment Body:: This one is due Monday! Lots of notice. Sue Mara Enron Corp. Tel: (415) 782-7802 Fax:(415) 782-7854 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Request Confidential Information by FERC Body:: Thanks. I'm on top of it. Christian Yoder 09/11/2000 08:06 AM To: Richard B Sanders/HOU/ECT@ECT Elizabeth Sager/HOU/ECT@ECT cc: Mary Hain/HOU/ECT@ECT Tim Belden/HOU/ECT@ECT Subject: Request Confidential Information by FERC Since Mary has been handling the ISO investigation I am assuming she is the point person for this one too. ---cgy ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CFTC Reauthorization Body:: Please go ahead with preparation of the talking points. I'll give Ken a heads up. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Have you seen this? Body:: Yes Thanks a lot. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Texas energy exec says, I told you Body:: Jeff FYI ?From the Contra Costa Times (East San Francisco Bay Area) Kevin Published Friday June 22 2001 Texas energy exec says 'I told you' POWER CRISIS ? Enron's Skilling gets pied before his speech blaming lawmakers but says he understands Californians' anger By Rick Jurgens TIMES STAFF WRITER SAN FRANCISCO -- A Texas energy executive who said his warnings were ignored by regulators who restructured California's electricity industry came to the Bay Area on Thursday to say in effect I told you so. Jeffrey Skilling chief executive of Houston-based Enron Corp. said that California wouldn't be in its current mess if regulators had followed his advice in 1994 and 1995. Regulators erred by forcing wholesale electricity transactions into the spot market so that deals could more easily be monitored Skilling said in a speech to about 100 people at the Commonwealth Club of California. They created a flawed marketplace in the name of regulatory expediency. Enron is a broker that buys and sells contracts to deliver power. Such bilateral transactions shouldn't have been banned Skilling said. Skilling said that's what he said six years ago. I probably made a pest of myself (in the restructuring hearings called by regulators) because I told them they were doing it wrong he said. They finally told me to keep quiet. On Thursday night it was Skilling's turn to be pestered. A woman threw a chocolate pie into his face before the event began. Police said Francine Cavanaugh of Oakland was arrested on suspicion of battery and released. Skilling tried to ignore protesters but said he understood why Californians facing blackouts and rising power costs were angry. He even had kind words for Gov. Gray Davis who he said was dealt a very difficult hand. Skilling became Enron's chief executive in February replacing company founder Kenneth Lay an early proponent of electricity deregulation who is close to President Bush. Enron a global energy giant with roots in the natural gas industry owns some power plants but its influence in the electricity industry reflects the rapid growth of its energy trading operation. Enron's only California generators are small wind facilities. However the company has developed power plants. Enron initiated two 750-megawatt projects that were sold to Calpine Corp. including a Pittsburg plant due to go online next month. Enron has announced plans to seek regulators' approval for a 750-megawatt power plant in Roseville in Placer County. During the first three months of 2001 Enron posted a huge jump in revenue to $50.1 billion from $13.1 billion a year ago but a much smaller gain in net income to $425 million from $338 million. Skilling himself cashed an $850000 paycheck and got a $5.6 million bonus last year. But the energy crisis has taken its toll on Enron's stock price and on Skilling who owned or held options to buy 1.9 million shares of Enron common stock at the time of the company's February proxy filing. At Thursday's closing price of $44.05 a share the stock was down more than 50 percent from its 52-week high of $90.75 in August. That proved that Enron wasn't the villain in California Skilling said. This thing in California has been bad for everybody he said. If we had anything to do with this we're the stupidest people in the world. Contact Information E-mail kevinscott@onlinemailbox.net Phone (213) 926-2626 Fax (707) 516-0019 Traditional Mail PO Box 21074 ?Los Angeles CA 90021 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Fwd: DRAFT RELEASE Body:: Minor changes shown on the attached (gotta get the big guy's title right). Lisa Connolly@EES 05/06/2001 08:17 AM To: Steven J Kean/NA/Enron@Enron Maureen McVicker/NA/Enron@Enron cc: Subject: Fwd: DRAFT RELEASE Please see attached press release with Skilling quote in red and on top of second page. The press conference is scheduled for 3:30pm on Monday May 7. The City will need our comment by 10am Monday morning. Thanks Lisa X54840 cell - 713-569-9563. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: Per last week's call I am circulating updated FERC staff talking points to the entire Western Wholesale group. This version of the talking points incorporates comments from Steffes Walton and Perrino. Phillip Allen: people on the call were wondering if there are any informal messages the West gas desk would like to relay to FERC staff. Notes however that ex parte contacts such as these generally must avoid issues that are being currently litigated by the FERC. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Test Message Body:: Shirley Please send me my SAP #. I need it to approve the expense report. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: P+ pricing/hedging Body:: Zimin I shall be in California on Thu. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I mentioned the need to call Gramm in the exec committee meeting today and Ken is willing to do it. The talking points ISDA sent looked fairly generic. Given Ken's relationship and the fact that he has talked to Gramm previously on the subject what should we ask Ken to cover? I'd like to give him a background document and talking points like we did last time. I will send it by fax to you Chris and would appreciate it if you could update it as appropriate. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Hi Daddy Body:: I love you baby. Study hard. Kean_Nora on 05/04/2001 01:09:47 PM To: 'skean@enron.com' cc: Subject: Hi Daddy Hi Daddy. I love you!! - Nora What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Mark Freverts column for ENAs Exchange Magazine Body:: I think it looks fine will defer to Jeff's edits. Jeannie Mandelker@ECT 09/21/2000 05:05 PM To: Steven J Kean/NA/Enron@Enron Jeff Dasovich/SFO/EES@EES Yvette Parker/Corp/Enron@ENRON cc: Subject: Mark Frevert's column for ENA's Exchange Magazine Steve this is the column I mentioned to you Monday. We do a column under Mark's name for ENA's customer magazine Exchange. This month's topic is California. I'd like you to read it and see if we are getting the message right. Jeff please let me know if there are errors. Once we get your comments we'll show it to Mark. Thanks Jeannie What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: RTO Orders - Grid South, SE Trans, SPP and Entergy Body:: I'm still a junkie .... please email copies of the orders. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Trip to California Body:: Liz Greg: Frank Wolak from Stanford will be back in the office on Tuesday August 7. I hope to set up a meeting with him and then to finalize the meeting with Prediction Co. I shall be shooting for August 23 - 24 in view of Greg's trip on the 15th and 16th. I left a message for Norman Packard telling him that I should be able to get back to him regarding the trip to Santa Fe by Tuesday this week. The first draft of the non-disclosure agreement will be ready by Tuesday or Wednesday. Have a good trip. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meeting with Bill Hogan, Mr. Lay, and Mr. Skilling, Irwin Stelzer and Richard Tabors will sit in as well, in 50M03 Body:: (Connie Burns in Bill Hogan's office 617-495-1318) Lunch will be served. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Oakland Trib Wed 3/7: Breakthrough made in rescue of PG&E Bakersfield Californian Wed 3/7: El Paso Energy closes six valley power plants Contra Costa Times Wed 3/7: Still undecided: Who'll pay DWR for electricity SF Chron Wed 3/7: State Taxpayers In Dark on Details Of Energy Deal Sac Bee Wed 3/7: Lawmakers pitch fixes for region's energy woes Orange Co. Register Wed 3/7: Power plan called wrong LA Times - Wed 3/7: Bill to Cut Some Power Prices Stalls Sac Bee Wed 3/7: PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts SF Chron Wed 3/7: PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service San Jose Mercury Wed 3/7: Power prices could soar during the summer SF Chron Wed 3/7: Power Plant Plans Cause Conflicts East county residents blast supervisors Contra Costa Times Wed 3/7: Supervisors set search for power plant sites Sac Bee Wed 3/7: Peter Schrag: California's $90 billion infrastructure gap Contra Costa Times Wed 3/7: PG&E power plan debated at hearing SF Chron Thurs. 3/8: State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August WSJ Thurs. 3/8: Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals ------------------------ Breakthrough made in rescue of PG&E State ready to pay $7 billion for lines By Steve Geissinger SACRAMENTO BUREAU SACRAMENTO -- Signaling a breakthrough in secret energy crisis talks the Davis administration disclosed Tuesday it may announce the framework of a pact to rescue the teetering Pacific Gas and Electric Co. next week. Things are going very well said Steve Maviglio a spokesman for Gov. Gray Davis. The state appears to be poised to pay at least $7 billion -- and possibly billions more -- for PG&E's high-voltage transmission lines as part of a deal to financially renovate the north-state utility according to sources familiar with the negotiations. But consumer advocates insisted that even the $7 billion price is too much to pay. And experts warned that a deal with PG&E will be more complex than with other utilities. PG&E representatives declined comment in keeping with their policy on the talks even though the Davis administration said an announcement could come as early as next week or the following week. The new timetable for an announcement was substantially sooner than in Davis' original forecast. Until late last week PG&E was still resisting the sale of its power grid despite the fact that Davis had announced the framework of an agreement with Southern California Edison. Davis expects to soon announce a similar deal with the San Diego Gas and Electric Co. However any such deal still would need federal approval. The investor-owned utilities trapped between high wholesale costs and lower regulated retail rates amassed nearly $13 billion in debts and were unable to buy electricity this winter. With the onset of rolling blackouts the state began brokering billions of dollars in emergency short- and long-term power purchases. Davis' strategy to ease the energy price and supply crisis includes bolstering both conservation and generation while fiscally refurbishing the nearly bankrupt utilities. As part of the rescue deal the utilities would have to drop legal actions seeking dramatically higher electricity bills environmentally shield wildlands they own sell power from their generators to Californians for the next decade and secure help with their debts from their parent companies. Together with the cash infusion from the sale of their power 26000-mile power grids the utilities would be allowed to sell bonds to raise funds and use customer money to pay them off. The state would upgrade the high-voltage lines and lease them back to the utilities for operation. In a reflection of the negotiations with the three utilities a Davis administration official said the deal with PG&E is proving to be more complex than with the other firms. Though PG&E finally agreed late last week to sell its transmission grid the utility apparently wants more than the $7 billion that Davis has offered according to sources. The figure is more than twice the book amount or the value placed on the system for purposes of accounting. And that's the markup that lured Edison into an agreement to sell its smaller portion of the transmission grid for $2.8 billion. But PG&E which fears an erosion of its economic base may be asking as much as $10 billion. Due to complexities in the state's 1996 deregulation of the industry PG&E is more likely to lose revenue than Edison as a result of selling its transmission lines according to experts. Big customers might be able to bypass the utility's remaining local distribution lines thereby eroding its customer base. Therefore the utility may view bankruptcy and sale of its transmission lines to the highest bidder as a potentially attractive alternative to selling its share of the grid to the state at too low a price. ---- El Paso Energy closes six valley power plants Filed: 03/07/2001 By CHIP POWER Californian staff writer e-mail: ppower@bakersfield.com El Paso Energy citing non-payment from Pacific Gas & Electric Co. said it has shut down six cogeneration plants this week. The smaller plants produced about 175 megawatts of electricity and are located primarily in the San Joaquin Valley said company spokesman Mel Scott. A megawatt can supply power to 1000 homes. At least 10 plants have closed in the past two weeks as a result of non-payment according to the state Independent System Operator which manages most of the state's electrical distribution. The El Paso Energy plants are operated with various partners and had not been compensated for December January and February deliveries said Scott. He said he did not know the total amount due but said the plants would be closed until PG&E's credit worthiness is improved. A cogeneration plant common in oil fields simultaneously produces heat energy and electrical or mechanical power from the same fuel in the same facility. Typically it produces electricity and steam which can be deployed to enhance oil recovery. Kern County is the state's leading oil-producing county. El Paso owns or has interests in more than 40000 miles of interstate and intrastate pipeline connecting the nation's principal natural gas supply regions to the five largest consuming regions in the United States namely the Gulf Coast California the Northeast the Midwest and the Southeast. El Paso closed up 99 cents on Tuesday or 1.4 percent at $71.49. The Houston-based company's stock price has ranged between $36.31 and $75.30 in the last 52 weeks. ---- Still undecided: Who'll pay DWR for electricity By Karen Gaudette ASSOCIATED PRESS SAN FRANCISCO -- The price tag is $3.2 billion and counting for electricity bought by the state Department of Water Resources for the customers of two nearly bankrupt utilities. Pacific Gas and Electric Co. Southern California Edison and the state disagree over how the DWR eventually will be reimbursed for its purchases on the expensive last-minute power market. So do the state power regulators who have the final call over who gets the money when. Under a recent law the DWR went into the electricity-buying business to help keep the two utilities from sinking further into their $13 billion debt. The state plans to retrieve the money by selling $10 billion in revenue bonds. The utilities continue to collect ratepayer dollars on that electricity which the bill's author Assemblyman Fred Keeley D-Boulder Creek says is meant to help them begin paying down their debt. In a recent letter however DWR officials requested that the state Public Utilities Commission order that a portion of that money be diverted to the state. But after the utilities subtract the costs of generating electricity payments to environmentally friendly power plants and other expenses there is no money left from ratepayer dollars to give to the DWR without sinking further into debt PG&E spokesman Ron Low said Tuesday. If it passed along money to the DWR our undercollection would grow by about $2.4 billion by the end of the year Low said. The commission unable to agree on the best course of action left the issue untouched at its last meeting but expects to revisit the issue when it meets this morning. Commissioner Richard Bilas is proposing an alternate plan that would have the DWR set its own revenue requirements that would be passed on to ratepayers. The PUC also is expected to respond to complaints from laid-off workers and customers that layoffs by utilities to cut costs have been hurting service. Commissioner Carl Wood warned at the last meeting that failure to provide safe and reliable service could mean fines for the utilities. Representatives from electrical workers unions the PUC and the utilities were to discuss the issue Tuesday afternoon. I don't think we believe that utilities can find a way out of their problems by laying off workers said Mindy Spatt a spokeswoman with the Utility Reform Network. We think consumers deserve safe and reliable service and we think they deserve it at a reasonable price. ---- State Taxpayers In Dark on Details Of Energy Deal David Lazarus Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle Few people would purchase a car simply because the dealer said ''Trust me it's a great deal.'' Yet Gov. Gray Davis essentially is telling Californians just that about dozens of long-term power contracts. Because of confidentiality agreements with power companies the governor has revealed only scant details about the state's multibillion-dollar contracts for electricity over the next 10 years. Gov. Davis has our money and we can't see how he's spending it said Doug Heller a spokesman for the Foundation for Taxpayer and Consumer Rights in Santa Monica. We've been locked out of the room. Neither Davis nor power companies would divulge specific details about the price duration or scope of individual contracts. Each cited secrecy clauses that the governor's office said had been desired by both sides. What consumers do know is this: -- California has signed 40 contracts and tentative accords valued at about $40 billion to secure enough power to light 9 million homes over the next decade. -- The average purchase price of each deal is $69 per megawatt hour -- well above the $30 to $40 charged by power generators before California's energy market went haywire last summer. -- If as is widely expected wholesale power prices fall in years ahead the state nevertheless will be locked into paying above-market rates for electricity. But it is not known which generator agreed to part with the most power at the cheapest level or the full range of the prices in concocting the $69 average. Moreover it is unclear how shrewdly the state negotiated with taxpayer money in securing power on behalf of cash-strapped utilities. These agreements are the bedrock of our long-term energy policy Davis said Monday in announcing the deals. The governor's office defended the murky nature of the contracts yesterday. It's a business transaction in which private corporate information is included said Steve Maviglio a spokesman for Davis. That's the kind of information that never gets revealed. While additional elements of the contracts will be publicized in coming months he said the contracts themselves will remain a secret. You'll never see all the details Maviglio said. This did not sit well with many observers. It's a breach of public trust said Daniel Bacon a San Francisco attorney specializing in business law. A public servant spending public money shouldn't be able to keep the spending secret. But Gary Ackerman executive director of the Western Power Trading Forum an energy-industry association in Menlo Park called confidentiality agreements a necessary evil in transactions like this. He explained that no power company would agree to a long-term contract if rival firms could learn the terms of the accord. The company would be losing too much of its competitive edge in the marketplace Ackerman said. At the same time he noted that secrecy allowed the buyer -- in this case California taxpayers -- to secure more favorable terms with individual sellers. A high price with one generator would not necessarily be sought by all power providers. Still the fact that public funds are being used makes confidentiality in this case a different matter than say Cisco Systems' quietly negotiating to take over yet another tech rival. The public is in a very awkward position said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. It has to rely on the good word and expertise of the governor and he has yet to demonstrate that he has expertise or good word in this field. Shames likened consumers to passengers in a plane being flown by a pilot without a license to fly. But what choice do we have? he asked. I don't see many other options available right now. There's the rub. No matter how bad a deal California may have cut to help meet its energy demands the alternative -- blackouts disruptions economic catastrophe -- is far far worse. On the other hand it already appears that the new contracts will not shield Californians from the threat of daily outages this summer when demand surges. Davis said only about 60 percent of the state's summertime electricity needs so far had been met. Part of the reason is that many power companies already have contracted for their output this year. Duke Energy said this was why it would not begin its nine-year contract with California until 2002 while Williams Cos. said it would only gradually increase the amount of available wattage in its 10-year contract. Both companies meanwhile will continue to profit this summer by selling into the volatile spot market where wholesale power went for as much as $1 500 per megawatt hour last year. You can't sell all your power into long-term contracts said Paula Hall- Collins a Williams spokeswoman. You save some for the spot market. Consumer groups worry that consumers will be hammered again this summer with sky-high power prices and then get nailed down the road by contracts for above-market rates. If we could look at the terms of the deals we'd see that California is being gouged for 10 years said Heller of the Foundation for Taxpayer and Consumer Rights. But the governor doesn't want us to see that. Ackerman of the Western Power Trading Forum said the state had gotten the best rates it could under current market conditions. California went for long-term contracts when everyone else moved in as well he said. Californians are paying a price for not acting sooner. ---- Lawmakers pitch fixes for region's energy woes By David Whitney Bee Washington Bureau (Published March 7 2001) WASHINGTON -- California members of Congress pleaded for everything from wholesale price caps to extending daylight-saving time an extra hour to help the region cope this summer with its persistent electricity shortage but none of the ideas seemed to catch fire at a House hearing Tuesday. People will die in California because of this crisis Rep. Brad Sherman a Los Angeles-area Republican warned the House Energy and Commerce Committee. Sherman testified that his idea for saving lives is to extend daylight-saving time by an extra hour so that there would be more daylight at the end of the day when power consumption surges. One of the peak demand periods for electricity occurs between 5 p.m. and 8 p.m. when the sun sets and people come home from work Sherman testified. If people come home and it is light out there is less of an inclination to turn a light on. Sherman said the state Legislature has called for congressional approval for states to be given authority to extend daylight-saving time and he cited analyses by the California Energy Commission and other agencies suggesting that it could cut power consumption by 1 percent to 2 percent. Sherman who was one of about a dozen California lawmakers presenting their views on the energy squeeze drew no questions from committee leaders about what his legislation might do to everything from airline schedules to television programming if West Coast states didn't agree on the same time standard. Most of the committee's questioning was on the more popular idea proposed by several California and Western lawmakers primarily Democrats to require the Federal Energy Regulatory Commission to impose caps on wholesale electricity prices that have gone wild because of a regional power shortage. Rep. Bob Filner D-San Diego charged that the price spiral has little to do with power shortages but a lot to do with a small cartel of generators bilking ratepayers. Rep. Jay Inslee D-Wash. said he brought up the idea of regional price caps with President Bush who was initially skeptical. But Inslee said that Bush warmed to the idea after being told that protections could be built into the caps so as not to discourage construction of new power plants. Upon hearing that Inslee said Bush invited him to meet with the president's Cabinet-level task force led by Vice President Dick Cheney on a national energy strategy. But Inslee said he can't get the group to meet with him. It's very disappointing Inslee said. Tuesday's hearing was part of a series the panel is holding on the California crisis so far without any emerging consensus on what if anything Congress should do. ---- Power plan called wrong Wall Street analysts say the governor's approach to the problem avoids the issue that caused the imbalance. March 7 2001 By DON THOMPSON The Associated Press SACRAMENTO California's scramble to insulate consumers from the soaring price of electricity may add to the state's power problems this summer Wall Street analysts said Tuesday. Gov. Gray Davis' emphasis on buying utilities' transmission lines and negotiating long-term power contracts to help ease their debts skirts the deep imbalance between wholesale and market rates that led to the state's power problems in the first place they said. In the long run it doesn't solve anything said Michael Worms an industry analyst for Gerard Klauer Mattison & Co. In the long run you need to send the right price signals to consumers which will create its own conservation signals. Unfortunately customers were shielded from that in California. Davis said Monday that the state's first contracts to buy electricity for two financially struggling utilities will provide only about two-thirds of the power needed on a typical summer day forcing Californians to cut power use at least 10 percent to avoid blackouts. Since early January the state has been buying one- third of the power Southern California Edison and Pacific Gas and Electric Co. customers need. The two utilities denied credit by suppliers say they have lost nearly $14 billion due to soaring wholesale electricity prices that the state's industry-deregulation law says they cannot pass on to consumers. The keepers of the state power grid had enough electricity Tuesday to avoid declaring an electricity alert but have faced an almost-daily scramble for weeks due to a tight supply and high wholesale prices. Several wholesale and retail rate proposals are circulating. Among them: Free-market advocates such as Worms want an immediate end to the deregulation-imposed retail rate freeze on Edison and PG&E that will expire next year. Davis wants a Western price cap of $100 per megawatt hour on power generators he says have been prof iteering from California's short energy supply. The Bush administration and Federal Energy Regulatory Commission are cool to that idea. In December FERC imposed a soft cap of $150 per megawatt hour on wholesale rates in the state and required suppliers to justify any higher prices they charge. Consumer groups such as The Utility Reform Network or TURN want regulated rates for residential and small-business customers but free-market rates for large industrial customers which sought deregulation in the first place. TURN also advocates a tiered rate structure with higher rates for consumers who use more than a reasonable amount of electricity each month. Assembly Republicans say electricity and natural-gas prices will fall naturally if the state increases supply mainly by making it easier to build plants and pipelines. Right now you're sort of sitting partially with regulation and part with the free market said Paul Fremont an analyst with Jefferies & Co. Both these systems work. It's sort of that in-between system that you have in Califor nia that doesn't appear to be working. The system discourages generators from building new power plants because they aren't guaranteed a profit and it doesn't do enough to discourage power use by consumers because the price they pay doesn't reflect the true cost of power Fremont said. I don't think people here have much faith in the market and why should they? countered TURN's Mindy Spatt. I think there are probably better ways of encouraging consumers to conserve than by gouging them. Davis insists the crisis can be resolved without raising rates for Edison and PG&E customers beyond the existing rate structure. In January state regulators imposed temporary rate hikes of 7 to 15 percent on Edison and PG&E customers. The Legislature and Davis extended the increases for up to a decade to help pay back the estimated $10 billion in power buying the state expects to do for Edison and PG&E over the next several years and finance its purchase of the power lines owned by the two companies and San Diego Gas & Electric. Rates were already scheduled to increase next year for Edison and PG&E customers. Under the 1996 deregulation law the pair's ratepayers saw a 10 percent rate reduction but only until early 2002. That rate cut will likely expire as planned Davis spokesman Steve Maviglio has said. Davis wants those rates to cover not only the traditional cost of generating transporting and distributing power but the added cost of paying off the two utilities' massive debt and buying their transmission lines said Assemblyman Fred Keeley D-Boulder Creek the Assembly's chief power negotiator. Yet Davis has indirectly addressed the rate imbalance by signing legislation that will let regulators raise consumer rates if necessary Keeley said. The governor and lawmakers are in effect spreading out rate increases over a decade by using long-term revenue bonds to buy power for the nearly bankrupt utilities said Severin Borenstein director of the University of California Energy Institute. At some point we have to deal with the reality that all of the power that we buy has to be paid for by somebody - it's either going to come from taxpayers or it's going to come from ratepayers Bor enstein said. Raising rates now would get us a lot of conservation. Davis also wants financial incentives for conservation and power-plant construction in time to make a difference this summer. Our mouths were agape at the rapid timetable Keeley said. Legislators are rushing to pass those incentives by month's end he said allowing three months for consumers and suppliers to act before the heat of summer. Among bills considered Tuesday the Senate Energy Committee approved legislation to accelerate the siting of power plants. It also was considering a proposal to restructure rates for generators that use renewable energy to provide about 30 percent of the state's electricity. ---- Bill to Cut Some Power Prices Stalls Energy: Democrats balk at varying payment levels for alternative generators. By DAN MORAIN JULIE TAMAKI Times Staff Writers SACRAMENTO--Legislation aimed at cutting prices for more than a fourth of the power consumed in California stalled Tuesday as Democrats questioned why a few alternative energy generators--some of them campaign donors--stood to receive higher payments than others. Lawmakers working to unravel California's energy mess have been negotiating for weeks in an effort to cut the price paid to more than 600 generators of alternative power by more than half to below 8 cents a kilowatt-hour. Those alternative generators' contracts with utilities have shot up in recent months because of a rise in the price of natural gas. The cash-strapped corporations have suspended or made partial payments to the generators over the last few months causing many to shut down or reduce their outputs. But even as the lawmakers reached agreement that pushed the average price to near the 8-cent level per kilowatt-hour some generators would have received higher prices under the bill by state Sen. Jim Battin (R-La Quinta). Some of the generators that stood to benefit had donated to Battin's campaigns. One--Windtec Inc.--gave Battin a $20000 campaign donation in 1999. Others contributed from $3000 and $5000 last year. Battin acknowledged that he has received campaign contributions from some wind power generators but said there is no connection between the donations and the bill's provisions. It is illegal it is unethical and it's not how I do business he said. Battin noted that 25% of the state's alternative energy producers are in his district. As Democrats on the Senate Energy Committee blocked the bill Battin warned that some alternative energy producers might react to the delay by trying to force Southern California Edison and Pacific Gas & Electric into bankruptcy. We will be the cause of bankruptcy Battin said. That prompted Energy Committee Chairwoman Debra Bowen (D-Marina del Rey) to retort: I'm really tired of being threatened with bankruptcy. Alternative energy producers including those that use wind solar power biomass and other means produce 27% of the energy used in California. They sell the electricity to the utilities which in turn transmit it to retail consumers. But with the utilities facing multibillion-dollar debts the alternative energy producers under contract with Edison have not been paid since November. Scores of alternative energy producers supported the measure. Edison International and the San Francisco-based consumer group the Utility Reform Network opposed it. Michael Florio of the Utility Reform group said the deal could result in higher consumer prices an Edison representative said the same thing. Battin and Assemblyman Fred Keeley (D-Boulder Creek) worked out an arrangement with many of the generators. Keeley took the lead in the early negotiations and then turned to Battin to introduce the legislation SB 47X. Rather convoluted language would have allowed higher payments to a select few generators that produce electricity from wind and biomass. Most of California's wind suppliers for instance would have received about 6 cents per kilowatt-hour. But a handful of them about half a dozen wind farms--mostly in the Palm Springs area represented by Battin--would have received 7.8 cents. Battin contends that other wind producers receive additional payments that boost them to the same level as Windtec and others that would get the higher payments. They get the same deal Battin said of the handful of generators that would benefit from the provisions he added to the bill. In California's overall energy market the amount of money that would have flowed to the favored generators is minor. But the added prices that would have been paid to the generators would have translated to at least $19 million in the next five years to be absorbed by Southern California Edison customers according to one analysis. Also Tuesday more details were disclosed about another leg of the state's effort to escape from the energy crunch--the deals with large power generators to supply electricity to California for as long as 10 years. Those arrangements were announced by Gov. Gray Davis Monday as the bedrock of California's energy policy. But some consumer advocates warned that the deals could lock the state into excessively high-priced contracts. S. David Freeman the general manager of the Los Angeles Department of Water and Power and Davis' negotiator said that the state guarded against that by varying the time spans of its deals. About 6000 megawatts are expected to be available this summer about one-third of the energy needed by the state Freeman said. The amount of power under contract swells until more than 9000 megawatts are contracted in 2004 half of the needed amount before dipping to 8000 megawatts in 2010. What we're doing here is what everybody said had to be done Freeman said. We deliberately bought 50% so we'd have a good mix between long-term contracts which may turn out to be somewhat higher or somewhat lower than the spot market and purchases on the spot market. ---- PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts By Carrie Peyton Bee Staff Writer (Published March 7 2001) Sacramento's electric utility wants out of a deal that imposes rolling blackouts locally on PG&E's command. So do a lot of other utilities. They've been writing letters lobbying lawmakers and launching informal talks with Pacific Gas and Electric Co. to get off the hook before summer. Who dodges the blackout bullet is going to play out as a political hot button around the state said George Fraser head of the Northern California Power Agency a coalition of municipal utilities. In Sacramento the next volley is expected soon with the Sacramento Municipal Utility District reportedly poised to notify PG&E that it will no longer black out homes and businesses on the larger utility's command. We are absolutely trying to fight off the requirement for rolling blackouts for the Sacramento area said Linda Davis one of seven elected members of the SMUD board of directors. Saying they don't want to be dragged down by somebody else's problems two Southern California utilities have written grid operators asking to be exempted from any blackouts caused by PG&E's or Southern California Edison's financial woes. But in PG&E's view California is in an energy crisis (and) ... we're all in this together said spokesman John Nelson. The maneuvering comes amid bleak forecasts for power supplies this summer. Although Gov. Gray Davis has said conservation new power plants and moderate weather could avert blackouts officials at the Independent System Operator which runs much of California's grid expect frequent rotating outages. One consulting firm Cambridge Energy Research Associates predicts 20 hours of rolling blackouts during July and August and about 200 hours of especially intense calls for voluntary cutbacks. Before blackouts hit the jockeying over just whose lights air conditioners and assembly lines will be shut down is growing. The outcome could affect millions of people statewide. The state Public Utilities Commission is probing rolling blackout programs run by the for-profit utilities it regulates including PG&E and Edison. A PUC analysis has suggested that PG&E's program which currently exempts about 40 percent of its customers should spread the burden more broadly. For example it said 1.9 million homes and businesses are spared just because they share a circuit with a customer deemed essential. But not-for-profit utilities such as SMUD which answer to their own elected boards or city councils have other worries. Many have already lined up their power supplies for summer. Some have raised rates or are considering raising rates. Some have taken extra conservation steps. They think those preparations ought to give them leverage to ease blackout clauses in their contracts with PG&E. SMUD general manager Jan Schori is going to use every avenue ... any avenue to put pressure on including lobbying the ISO the governor and others said utility director Davis. The Northern California Power Agency a joint-powers authority that owns and operates power plants for municipal utilities has begun informal negotiations with PG&E to change blackout rules according to Fraser its top executive. It is preparing to write PG&E asking that its members be exempted from outages altogether. Failing that it wants them to face fewer outages or to be compensated for cutting off power he said. At SMUD the utility board has met in closed session to discuss exactly what it is required to do during electric emergencies under terms of the interconnection contract that links SMUD's lines to PG&E's. The contracts are being inspected with a fine-tooth comb said SMUD director Howard Posner. Schori declined to comment on any specifics. Sources indicated that the main option being considered is notifying PG&E that because of changed circumstances SMUD believes it no longer is required to routinely comply with outage requests. Other options being explored include re-negotiating existing agreements with PG&E. Posner said that ever since two days of rolling blackouts in January constituents have been asking him 'Why are we participating when we're not the problem?' And I don't have a good answer to that. Several directors said SMUD has already spent a lot of money -- and is considering 16 percent rate increases -- to ensure that it has enough electricity under contract to meet its customers' summer demands. They believe PG&E should do the same. We're almost like a David against Goliath here said board vice president Genevieve Shiroma. The huge investor-owned utilities next door have severe problems that they need to get under control. In addition SMUD plans to argue that because it can cut usage through its Peak Corps program which remotely turns off air conditioners at volunteer households it has already done its part without rotating outages director Davis said. PG&E believes the interconnection agreements that govern smaller utilities' ties to its transmission lines have benefits and burdens to both sides said Nelson. It wouldn't be fair or good policy for just one provision to be altered without taking a look at how that affects the entire contract he said. Interconnection contracts generally have clauses that require utilities to help each other out to avert greater emergencies. Sometimes reducing demand -- called load shedding -- can be the only way to stabilize the electric grid in the seconds after a major power plant or transmission line fails. It's been around in the electrical fabric forever said Jim Pope head of Silicon Valley Power Santa Clara's city-run utility. In addition to legal requirements you have a moral obligation so you don't bring the system to collapse. Like other city-run utilities Silicon Valley Power has a contract with PG&E that requires it to shed load during an electric emergency. But its contract allows it to work with big users to reduce their demand so no one has to be completely shut off. Such agreements formed long before deregulation when PG&E ran the north state's grid now are complicated by the 1997 creation of the state Independent System Operator. The ISO today runs pieces of the grid owned by PG&E Edison and San Diego Gas & Electric Co. If it believes power use is about to surge past supply potentially triggering a grid collapse across the western United States the ISO notifies the three utilities that they have to shed a certain number of megawatts. The big utilities meet that requirement two ways. They cut circuits to some of their own customers and they tell smaller connected utilities to cut a proportionate share. In Northern California about 80 percent of the outages are borne by PG&E customers and the rest by customers of SMUD and other municipal utilities and irrigation districts. In one sense we are all in this together. If SMUD were in danger of going down we would hope others would help us out said SMUD's Posner. But that's if we're in danger from circumstances beyond our control not from mismanagement or lack of financial wherewithal. It is unclear what penalties if any a utility would face for violating an interconnection agreement. In the long run the issue would be fought either in the courts or before the Federal Energy Regulatory Commission grid officials said. As a practical matter in the seconds when the risk to the grid is greatest if one utility refused to shed load the ISO would probably solve to problem by calling on PG&E Edison or others who are willing to make deeper cutbacks they said. ---- PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service Bernadette Tansey Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle State regulators are set to decide today whether debt-ridden Pacific Gas and Electric Co. and Southern California Edison can conserve cash by laying off thousands of workers and letting service standards slip. Union officials who protested the layoffs before the California Public Utilities Commission warn that if the cuts go through neighborhoods hit by power outages could stay dark for hours and more customers could face busy signals when they call about their bills. An administrative law judge agreed advising the commission in February to order the utilities to restore 725 positions already cut and block the elimination of an additional 2125 jobs. Judge John Wong said PG&E and Edison have acknowledged the layoffs will not substantially improve their shaky financial condition which arose from skyrocketing wholesale electricity costs the utilities could not pass on to consumers under a rate cap. The savings would barely make a dent Wong said in his draft decision. The two companies together claim that their debt from power purchases amounts to more than $13 billion. PG&E says it has saved $18 million from the first wave of 325 layoffs. Wong's recommendation is already running into resistance on the PUC. Commissioner Richard Bilas said the five-member panel should not be micromanaging the utilities in a time of crisis. Bilas has proposed an alternate ruling that would allow the utilities to make the cuts but provide for PUC monitoring of service in case the commission wants to step in later. We're in a situation where the utilities are not collecting the revenues they need to operate and yet we may be guilty of not letting them cut expenses where they can cut expenses Bilas said. PG&E spokesman Jon Tremayne said savings from the layoffs are helping to keep electricity running and gas flowing. It keeps cash in our accounts so we can keep doing day-to-day business Tremayne said. In addition to the 325 positions dropped so far PG&E is proposing to cut an additional 675 during the next three to six months. The cuts affect temporary and contract workers who read meters handle new service hookups and replace equipment. PG&E has no plans to eliminate permanent positions. The company is struggling to keep up with a higher workload at its call center as customers deluge the lines with inquiries about their rising bills and the effects of deregulation. Calls to PG&E ballooned from 1.3 million in January 2000 to 2.3 million in January 2001. Bilas advocates granting PG&E's request to temporarily relax standards requiring the utility to respond swiftly to customer calls and to read customers' meters once a month. PG&E wants to read meters bimonthly and send bills based on the estimated use between readings. Discrepancies could be corrected later. Wong called those measures unacceptable. He said customers need to know immediately if their efforts to conserve power are working. Wong also said the utilities' own experts have said the workforce reductions will lengthen the time required to restore power after nonemergency equipment failure. Eric Wolfe communications director for the International Brotherhood of Electrical Workers Local 1245 said some customers have already been left without power overnight because PG&E is trying to avoid the use of overtime on nonemergency power outages. It hurts a lineman to walk away from the job leaving a customer without power Wolfe said. Tremayne said PG&E is trying to minimize overtime costs but denied the company has allowed customers to go without power out of financial concerns. He said crews were pulled out when darkness and falling trees made the work too dangerous. ---- Power prices could soar during the summer Posted at 10:35 p.m. PST Tuesday March 6 2001 BY STEVE JOHNSON Mercury News Unless Gov. Gray Davis arranges significantly more long-term electricity contracts or persuades people to turn off a lot more lights California's unpredictable spot market for power could wreak havoc this summer. Even with the 40 long-term deals announced by Davis on Monday experts interviewed Tuesday said up to 43 percent of the state's daily needs may have to come from this highly volatile market in which power is bought within a day of need. That could could prove hugely expensive because some spot market energy has cost five to six times what it would under the long-term contracts. It's widely expected that consumers ultimately would have to pay that tab which could amount to billions of dollars. And because that power won't be locked up in contracts there is no guarantee it will be available when it's needed which could lead to blackouts according to a recent report to the California Independent System Operator which oversees three-fourths of the state's power grid. ``The situation in California could reach catastrophic proportions'' the report concluded adding that unless things change dramatically ``it is a virtual certainty that peak demand will go unmet during many hot summer days.'' Steven Maviglio Davis' press secretary conceded Tuesday that the spot market could be troublesome. ``It's a major concern'' he said which is why the state is trying to line up more power contracts speed up power plant construction and promote conservation. During the normally hot month of August peak daily demand for power in the Independent System Operator's territory is expected to hit about 47700 megawatts -- enough for nearly 48 million homes. The state's three main utility firms generate about 8200 megawatts and have long-term contracts from wind solar and other energy sources for about 11700 megawatts more. That totals about 20000 megawatts. Add in the 7000 megawatts of long-term power that Davis has announced for this summer and the state is still nearly 21000 megawatts short. Costly proposition If all that power has to be obtained on the spot market the price could be high. On Friday last-minute purchases on the market averaged $411 per megawatt-hour compared to about $150 per megawatt-hour for all power obtained by the Independent System Operator and $69 per megawatt-hour on average under Davis' long-term contracts. It's possible that not all 21000 megawatts would have to be purchased on the market. Assuming Davis is successful in getting people to save 10 percent -- which could prove difficult -- conservation could reduce peak demand by nearly 5000 megawatts. California also might be able to trade for another 5000 megawatts with the federal government's Bonneville Power Administration and a hydroelectric operator in British Columbia said Arthur O'Donnell editor of California Energy Markets a trade publication. Under such deals those two outfits often send that much power to California when they don't need it and California returns the same amount or more when its demand is low. But O'Donnell said it wasn't clear whether 5000 megawatts would be available this summer because ``they still haven't gotten the snowpack they need in the Pacific Northwest'' which could limit that region's generating capacity. Still falling short Even if those hydropower imports are available and conservation works as Davis hopes it's likely California would still require the spot market for 11000 megawatts to meet the August demand. That's more than 20 percent of the state's overall power needs. ``All of the surrounding states are buying probably less than 5 percent at most of their energy on the spot market'' said Frank Wolak a Stanford economist who monitors electricity prices for the Independent System Operator. He worries about how much that power could cost and is disturbed that state officials haven't adequately addressed the issue. ``No one has any idea what they are going to do and that is part of the problem'' he said. Officials at Pacific Gas & Electric Co. are particularly concerned. They fear that their company -- which is nearing bankruptcy -- could get stuck for much of the spot market purchases by the Independent System Operator which has threatened to bill the utilities for the cost. Fearing the annual bill for that power could hit $2.4 billion this year PG&E wants the tab sent to the Department of Water Resources which also is buying power on the spot market for the state. But the Department of Water Resources has objected to that idea and the matter is expected to be heard today by the California Public Utilities Commission. ``We're looking for clarity on a number of issues'' regarding how the spot market will work ``and certainly that's one of them'' said Thomas Hannigan the water agency's director. ``I don't think anybody knows the answer of who's going to pay for it'' added PG&E spokesman John Nelson. But Nettie Hoge executive director of the Utility Reform Network in San Francisco said she suspects consumers ultimately will foot the bill. The unfortunate likelihood about spot market purchases is that ``ratepayers are responsible for all of it eventually'' Hoge said. ``It's a very big problem.'' ---- Power Plant Plans Cause Conflicts East county residents blast supervisors Jason B. Johnson Chronicle Staff Writer Wednesday March 7 2001 Industry dreams of building new power plants in east Contra Costa's hills are prompting an angry reaction among residents and elected officials who say they don't want more plants. The conflict was sparked by a vote by county supervisors yesterday to aggressively explore possible sites for new power plants throughout the county. The measure by Supervisors Mark DeSaulnier and Federal Glover which passed on a 4-to-0 vote directs the county administrator and Department of Community Development to compile a report on possible sites within 45 days. Supervisor Donna Gerber abstained after criticizing the plan for potentially repeating the same mistakes that plagued the state's energy deregulation effort by not considering how much energy the state region and county will need in future years and how much power is slated to come online. Gerber said alternative power sources such as solar should also be examined. A site drawing much attention is on top of a deposit of natural gas near the Concord Naval Weapons Station off Highway 4. The owners of 70 acres of land near the station recently formed a company Golden State Power Co. to pursue construction of at least one small peaker plant and a much larger facility capable of producing 600 megawatts. The site could hold up to three small 50-megawatt peaker plants and a larger 15-acre natural gas plant said Steve Thomas managing partner with Golden State. No land use applications have been filed. Thomas said 30 acres could be kept as open space to form a buffer around the project. Both (facilities) are state of the art said Thomas. We believe that the site is ideal. But east county residents at yesterday's meeting blasted the supervisorial measure and the power plant proposal complaining that more plants could put people's health at risk. The region already is home to six power plants. We're going to get a good dose of poor air quality and (negative) health conditions from this said Concord resident Evelyn Frietas. I think we need to stop and think about what we're doing to our quality of life. Dan Torres said the home he bought in 1995 at a new Bay Point development would be alarmingly close to the proposed Golden State site. It will be dragging emissions over our home said Torres. I didn't buy a home on that hill to be surrounded by power plants. There are six power plants in operation in east Contra Costa. Pittsburg already has two power plants and two more under construction. City Council members Frank Aiello and Yvonne Beals said the Antioch-Pittsburg area has done more than its share of energy production. Aiello said Pittsburg will soon produce enough energy to power three million homes in California. When is enough enough? asked Aiello. Pittsburg has shouldered responsibility for a land-fill and two more power plants. At some point you have to say enough. Beals said that while power plants have added millions to the city's general fund the negatives of additional plants could outweigh the benefits. I don't think that Pittsburg or east county should be the dumping ground for energy for California said Beals. ---- Supervisors set search for power plant sites The board also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord By Thomas Peele TIMES STAFF WRITER MARTINEZ -- Contra Costa County supervisors took tentative steps Tuesday toward allowing the construction of at least one small power plant before summer ordering that its staff identify potential sites in unincorporated areas within seven weeks. The board voted 4-0 to search for locations. Third District Supervisor Donna Gerber abstained saying her colleagues lacked a comprehensive context'' to identify sites. I think the board knows just enough to be dangerous'' she said. Gerber said the county should examine the potential for additional power plants within its borders but not investigate individual sites yet. But Fourth District Supervisor Mark DeSaulnier said the action was necessary because of the energy crisis and because of Gov. Gray Davis' call for local governments to help speed the construction of so-called peaker plants before July and August. I wouldn't do this except under an emergency DeSaulnier said after the vote. There are unusual circumstances. We're not talking about putting this in a residential area. Fifth District Supervisor Federal Glover backed DeSaulnier but said he hoped for a location outside his heavily industrialized East County district. There's a lot of concern in East County as to the number of plants he said. DeSaulnier said though that the only logical place for a small plant remains the industrial belt'' stretching along the waterfront from West County to Antioch. He declined to provide specifics but said the only other potential site outside the industrial areas was the Concord Naval Weapons Station property. But he quickly added that he believes the U.S. Department of Defense would never go for it. Also DeSaulnier said he could not rule out the county building the plant itself and entering the electricity-selling market during peak demand times. Board Chairwoman Gayle Uilkema called that idea extremely premature and unlikely. That's a very powerful decision. I do not think we are ready'' she said. The California Energy Commission listed the Equilon refinery in Martinez as one of 32 potential peaker plant sites in the state last week. Peaker plants kick in during peak usage times. Davis called for their quick construction before the height of summer and its energy demand for air conditioning. Plants that generate as much as 50000 megawatts don't need Energy Commission approval. DeSaulnier said he believed a peaker plant could be built about a month after final approval. Supervisors also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord. Walnut Creek commercial real estate developer Steve Thomas announced his intentions for the site north of Highway 4 last week. Construction could take two years. Eric Hasseltine a consultant representing Thomas and what he described as a brand new company for the site the Golden State Power Co. told supervisors that if they intended to speed peaker plant construction they should do what they can to expedite the larger plant. The Thomas site could house a peaker plant until the proposed larger one goes online. A large natural gas line passes under the site. DeSaulnier seemed cautious about the larger proposal which he had described last week as a good site. Uilkema too said she knew too little about it to comment. A resident who lives near the Thomas property asked the board to build it (the larger plant) closer to where you have industrial areas. You have to carefully consider the people who live nearby said Dan Torres 39. Evelyn Freitas of Concord said she lives downwind of the proposed site. Our air quality is going to be worse then it is now she said. Gerber played on the environmental issues saying the county already ranks second statewide to Los Angeles in volume of hazardous materials and amount of electrical generation. ---- Peter Schrag: California's $90 billion infrastructure gap (Published March 7 2001) By now California's surreal energy mess has grown from a crisis to a condition. It may not be quite as permanent as say death and taxes but it's still something that could get a whole lot worse before it gets better. Until there's more realistic pricing no gubernatorial pea-under-the-shell buyout scheme will solve it. Beyond the energy crisis however and in many ways similar to it California faces a whole range of other infrastructure problems -- in transportation in water resources and sewer systems in school and university buildings -- that seem once again to be all but forgotten. The Business Roundtable has estimated the need at roughly $90 billion though no number can possibly be exact. What's certain is that after a burst of high-level investment in public facilities during the 1950s and 1960s California's annual capital investment has sunk precipitously -- from an annual $150 per capita in the 1960s according to a set of recent studies for PPIC the Public Policy Institute of California to about $30 in the 1990s. But you probably don't need to tell anyone driving Bay Area or Los Angeles freeways or looking at the ubiquitous portable classrooms those dreary brown boxes that house a fourth of our public school students. Ever since passage of Proposition 13 in 1978 we have been flying the flag of deferred maintenance. As in the state's electricity crisis however there's no way California can effectively address those problems merely by building or bonding itself out of them. In highway construction in developing water resources in finding enough university space to accommodate the Tidal Wave II of students managing demand is likely to be as crucial to any solution as new construction. In the energy market -- and in electricity particularly -- it's been a familiar principle ever since David Roe of the Environmental Defense Fund first persuaded Pacific Gas and Electric that a dollar invested in conservation may be worth as much as the same investment in new generation. But in most other sectors of California's infrastructure state and local it's a lesson still to be learned. There have been scattered attempts to encourage conservation and reduce demand -- significant reduction in water use for example through the installation of low-flow faucets and low-flush toilets some reduction in traffic by using rush-hour diamond lanes or by adjusting highway or (as in New York) bridge tolls to levels of congestion. But as pointed out by David Dowall an urban economist at Berkeley state policy-makers have not really begun to consider how demand management strategies can be applied to infrastructure service areas or how the more efficient use of facilities and more realistic pricing -- highway tolls say or parking fees -- can reduce demand for scarce infrastructure resources. In any case says Dowall in one of the PPIC reports we should pick which major projects we will build not just according to per capita estimates of how much we need but according to how much consumers are willing to pay for them. To avoid hurting the poor congestion-related highway tolls and other tariffs can be rebated on the basis of income. University fees can be means-tested. In California they also could be adjusted to encourage summer school classes and other off-peak uses rather than (as in the past) making UC summer courses more expensive. Given the political and economic uncertainties there's no way to know how far such demand management can be taken. But there's not much doubt that as Dowall and others point out the state's infrastructure planning is a jumble of uncoordinated agency agendas and wish lists. The Legislature last year passed a bill AB 1473 by Assembly Speaker Robert Hertzberg that requires the governor beginning next year to submit an annual five-year infrastructure plan for state agencies and public schools along with recommendations on how to fund it. In addition Gov. Gray Davis' infrastructure commission is expected to recommend better coordination of infrastructure and land-use planning when it issues its report this spring. That would be a start. As California State Treasurer Phil Angelides has pointed out the state desperately needs to start joint planning -- regional planning -- for housing roads and other resources to reduce the need for long commutes to preserve open space and to bring jobs to where people live and housing to where the jobs are. That would itself reduce demand for more freeway lanes and equally important improve the quality of life. At present most planning for housing roads water systems and other facilities rarely recognizes the regional impact of local decisions. In the East Bay slow-growth forces push well-intended initiatives that would force more development into Tracy or Modesto and further tax the transportation systems to Silicon Valley. In city after city there are beggar-thy-neighbor efforts to grab yet another shopping mall that produces a little extra sales tax revenue for the city that gets it and that often compounds traffic and revenue problems in adjacent communities. In higher education we divide bond proceeds evenly among UC the California State University and the community colleges even though the community colleges serve eight times as many students as UC. We plan road projects according to county not regional priorities. It is all done according to antiquated political and fiscal formulas that often no longer make sense. We don't just need better capital planning we need a whole new planning system. ---- PG&E power plan debated at hearing A PUC meeting on the utility's capacity expansion project for the Tri-Valley follows weeks of protest from officials residents Power upgrade in valley debated By Megan Long TIMES STAFF WRITER SAN FRANCISCO -- Dublin officials and the developer of a Livermore subdivision faced questions Tuesday about their opposition to alternative routes of PG&E's controversial Tri-Valley power upgrade plan -- and answered by restating their long-standing objections. Tuesday's cross-examination came during the third and likely final week of the California Public Utility Commission's evidentiary hearings on the utility's $91 million Tri-Valley 2002 Capacity Increase Project. It has followed weeks of protests of PG&E's upgrade plans by officials and residents of Livermore Pleasanton Dublin and San Ramon. And before the questioning started Dublin Vice Mayor Janet Lockhart reiterated concerns about an alternative route deemed environmentally superior that would place a substation just 1000 feet north of Interstate 580 between Tassajara and Fallon roads. She said that would undermine the results of a 15-year process to plan the eastern development of the city. It's extremely important to the residents of our community to follow a plan we worked hard to produce she said. Dublin officials favor PG&E's proposed placement of the station three miles north of the freeway away from new high-tech company offices and housing developments. Besides the Dublin substation the project calls for construction of a substation in North Livermore expansion of the Pleasanton substation and installation of 23.5 miles of new lines. In response to questions from PUC Administrative Law Judge Michelle Cooke Dublin's public works director Lee Thompson confirmed that the Lin family the owner of the property where the alternative substation would go wasn't interested in selling the land to PG&E. Cooke also asked Thompson to define a discretionary permit which is how city officials said they might treat a permit for a substation. Lee said that type of permit is one the city has the right to approve or not depending on the project's impact. Eddie Peabody Dublin's community development director testified that the zoning for the Lin property accommodates uses such as commercial business research and development and light manufacturing. It would not he said be appropriate for a power substation. He said parcels within the East Dublin area that could host a station would include those zoned for public and semi-public uses including land recently bought by Oracle and Sun Microsystems for new campuses. While Dublin officials testified that one buyer of land in that area paid $86 per square foot others suggested land prices would be inflated to help make a PG&E land buy look prohibitively expensive. An executive of Centex Homes the developer of new houses near Isabel Avenue and Concannon Boulevard objected to an alternative route that would place high-voltage transmission lines overhead along Isabel and Stanley Boulevard. David Barclay president of Centex's Northern California division said that the 80-foot to 150-foot towers would have a severe visual impact on residents of the Prima tract. Ed O'Neill a lawyer for the Kottinger Ranch Homeowners Association pointed out that existing distribution lines on 50-foot poles on Isabel already mar the view for residents. The Foley family has been ranching on land south of Pleasanton city limits for years said their attorney Kennedy Richardson. The utility's project would place overhead lines and a transmission station on rolling hills that the family envisions as one day being public open space with limited development Richardson said. Lawyers for Pleasanton Livermore Kottinger Ranch and Centex are scheduled to cross-examine a PG&E engineer today about the project's routing. That testimony should be the most controversial of the hearings. Judge Cooke is expected to recommend an alignment by July to the PUC which will make the final decision. ---- NEWS State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August Marshall Wilson 03/08/2001 The San Francisco Chronicle FINAL Page A.20 (Copyright 2001) State energy officials yesterday approved plans to build a temporary electrical plant at San Francisco International Airport that should generate enough juice to power 50000 homes by August. Meeting in Sacramento the Energy Commission voted 4-0 to give the green light to the gas-fired plant. It will operate during peak summer and winter demand to help the state avoid Stage 3 power alerts and rolling blackouts. Texas-based El Paso Merchant Energy Co. won approval under a new state law mandating speedy four-month reviews of so-called peaker plants. It was the only one of seven applications statewide to win approval. The other proposals were withdrawn for various reasons. The 51-megawatt plant formally called the United Golden Gate Power Project is scheduled to be built at the northwest corner of the airport near the United Airlines maintenance center. Within the next few weeks El Paso plans to apply to build a 571- megawatt $400 million plant in the same area company spokesman Jesse Frederick said. It would undergo a separate review by state energy officials. The small peaker plant approved yesterday is to generate electricity beginning around Aug. 1 for up to three years. After the end of three years the plant would be closed or converted to a cleaner-burning system. Under state law a temporary peaker plant is permitted to spew more air pollution than a permanent plant. El Paso's temporary plant is to be built next to a co-generation plant operated by United Airlines. It would use existing connections for natural gas and water supplies and tap into existing power transmission lines. Electricity generated by the plant would be pumped into the state's electrical grid Energy Commission spokesman Gary Fay said. It would also serve as a backup for San Francisco Airport in case of a blackout. No one spoke against the proposed plant at yesterday's commission meeting. The proposal however has been criticized by area residents and environmentalists worried about air pollution. Scott Buschman a professional photographer and San Bruno resident said yesterday it was unjust that state officials 100 miles away in Sacramento approved a Texas company's proposal to put a power plant on land owned by San Francisco. The fact that they approved it without considering the public's concerns foremost air quality is very disturbing he said. Fay said the plant complies with clean-air standards. Answering the criticism about the location of yesterday's deliberation he said three hearings and several workshops were held in communities near the airport. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. ---- Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals By Wall Street Journal staff reporters Rebecca Smith Mitchel Benson and John R. Emshwiller 03/08/2001 The Wall Street Journal A1 (Copyright (c) 2001 Dow Jones & Company Inc.) SACRAMENTO Calif. -- Earlier this year Gov. Gray Davis made what may be the biggest bet in the history of the nation's biggest state: that he could tame an out-of-control electricity market and avoid devastating blackouts without busting the state's budget antagonizing its consumers or derailing his own political career. His wager is still on the table but the assumptions that underlie it are looking increasingly shaky these days. The governor has already spent around $2 billion of public money buying hugely expensive wholesale power taking over the role formerly played by the state's near-bankrupt electric utilities. And California will probably be obliged to spend billions more before its electricity market stabilizes and those utilities are restored to some semblance of financial health. Under the governor's plan California aims to recoup the money it is using to buy electricity by issuing $10 billion in bonds. That way it would still have a healthy budget surplus to finance new spending on roads schools and other public services. But there's a potentially big obstacle to this plan. The state Legislature worried about racking up billions in new debt has put limits on the size of any bond offering. In broad terms the Legislature's action would allow the state to borrow only four times as much as it can recover annually from utility customers. Right now that doesn't appear to be much. Under the current rate structure essentially set in place by California's flawed 1996 electricity-deregulation plan consumers pay far less for power than the cost of acquiring it on the wholesale market. Preliminary estimates submitted by utilities last month to the California Public Utilities Commission show the state's share of the proceeds from electricity sales this year could be as little as $241 million -- not enough to support even $1 billion in bond sales under the Legislature's formula. That would leave the state on the hook for much of the money it has already paid for power -- not to mention the billions more Gov. Davis will need to spend. That in turn raises the prospect that California's economy and its credit rating both could deteriorate significantly. But state finance officials say that based on their own projections they will be able to extract enough money to support a $10 billion bond issue. Walking a careful line between fiscal prudence and political survival Mr. Davis and others in his administration are scrambling to come up with ways to get around the legislative restrictions without raising rates for consumers. If I wanted to raise rates I could solve this problem in 20 minutes Mr. Davis says. The governor says he believes that the state can obtain enough affordable power through long-term power-supply contracts to avoid the need for a big rate increase. The billions of dollars the state hopes to borrow would be used to help pay for power until electricity prices drop as they are expected to do when new power plants come online over the next few years. The Davis administration fears that what may be its only other option -- a big increase in retail electric rates -- could prompt angry consumer groups to seek new electricity laws through a statewide ballot initiative during next year's election. That's when Mr. Davis is expected to run for a second term as governor. But trying to save California without rate increases is forcing Mr. Davis to make some colossal gambles with the state's money. State officials estimate that in the next several months California will need to spend as much as $6 billion on power purchases -- equivalent to the state's entire fiscal surplus. Mr. Davis is also looking to spend several billion more to buy the transmission assets of three investor-owned utilities in order to restore two of them to credit-worthiness. He also has announced plans to spend several hundred million dollars more on conservation programs designed to reduce demand while new power plants are being built in the state. In order to limit the state's financial exposure in the meantime the governor and his aides have in some cases ignored state law. They have threatened appointed officials who have stood in the way. And they have sharply restricted the flow of information to the public. None of those steps is expected to do much to reduce state spending on power in the coming months. In a few weeks power usage is expected to begin a sharp seasonal rise as Californians switch on their air conditioners with the coming of warmer weather. By various estimates demand during peak periods this summer could outstrip supply by 10% or several thousand megawatts. That could produce more rolling blackouts like the ones that hit Northern California earlier this year. It is also likely to put strong upward pressure on wholesale electricity prices. Steven Zimmerman managing director of Standard & Poor's Corp. says Mr. Davis and his aides don't have a lot of time to put a cap on the state's financial exposure to the crisis. The credit-rating agency has put the state on credit watch for a possible downgrade which would affect the value of all of California's outstanding public debt. Moody's Investor Service Inc. is also concerned. It said in a recent report that the power crisis could soon seriously threaten the health of the state's economy. Mr. Davis a Democrat and career politician was dealt a bad hand when he took office in 1999. The deregulation plan that sparked the state's electricity crisis was enacted under his predecessor Republican Pete Wilson. But Mr. Davis was slow to react to early signs of trouble this past summer and alarms sounded by members of the state Legislature. By the time Mr. Davis finally sprang into action earlier this year a troublesome power-supply squeeze had escalated into a crisis. In a Jan. 17 declaration of emergency the governor designated the state Department of Water Resources to take the utilities' place as the daily buyer of huge quantities of electricity. His hope: that by making the state the dominant player in California's power sector he would ease electricity producers' concerns about getting paid and give the state enough clout to negotiate lower long-term power prices. Earlier this week Mr. Davis announced final or tentative agreements with 20 power suppliers to furnish the state with a total of 8900 megawatts for periods of as long as 20 years. But the supply situation remains extremely uncertain for this summer when demand probably will top 45000 megawatts. If the state can secure enough power under contract and push down demand through aggressive conservation it might be able to squeak through the summer season. If not it will be forced to keep buying huge amounts of costly power in the cash market. Under deregulation retail electric rates were frozen for several years while wholesale-power costs were free to fluctuate. When the plan was conceived wholesale prices were low and expected to go lower. However a combination of unexpected growth in power demand and a lack of new generating capacity helped produce a supply squeeze. Average wholesale prices more than tripled last year from 1999. And in January those prices were up 10-fold from a year earlier. By then California's two biggest investor-owned utilities -- the Pacific Gas & Electric unit of PG&E Corp. and the Southern California Edison subsidiary of Edison International -- faced imminent financial collapse. They had racked up billions of dollars in wholesale power bills they couldn't afford to pay. As generators began shying away from selling to the two utilities the Clinton administration forced them to sell power into the California market an order left in place during the first weeks of the Bush administration. Still northern California was hit by rolling blackouts on several days in early January. Since then the DWR which does some electricity trading as an adjunct to its main mission of managing the state's giant system of aqueducts and reservoirs has had to learn the ins and outs of power markets on the run. It hasn't been easy. David Mills trading-floor manager for the federal Bonneville Power Administration says the water agency has at times offered to pay $50 to $100 per megawatt hour more than the available market price. They agree to prices that make you wonder says Mr. Mills whose organization markets electricity from federal dams in the Pacific Northwest. You'd at least think they'd check to see what the prevailing price is before throwing out their offer. Mr. Mills says that to cut California some slack he occasionally has instructed his traders to sell at prices lower than the DWR had offered to pay. Ray Hart the water agency deputy director responsible for the power purchasing says he isn't aware of any cases in which the DWR has overpaid. He says his team has been extremely successful by all measures. Ultimately the DWR's trading acumen is far less important than the overall arithmetic of power supply and demand in California. With the price of natural gas that feeds many of the region's generating plants at near record levels and some suppliers reluctant to sell into the troubled California market wholesale electric prices remain stubbornly high and in recent days have again been rising. The Legislature has advanced the DWR about $3 billion from the state's general fund for power purchases. Under emergency legislation passed by the Legislature and signed by Mr. Davis on Feb. 1 the general fund is to be reimbursed from a planned bond sale later this year. But under terms of the emergency law the water agency would have to wrest $2.5 billion a year in revenue from retail electricity rates in order to sell the $10 billion worth of bonds sought by Mr. Davis. Assembly Speaker Robert Hertzberg a Southern California Democrat says the formula was created to ensure that there would be a way to repay the bonds without draining the state's coffers. We didn't want to just open our wallets he says. According to the language of the Feb. 1 law the water agency gets what's left of revenue collected from ratepayers after the utilities pay certain of their own power-supply bills and other expenses. And in their filings with the PUC last month the utilities reckoned under their worst-case scenarios that there would be only $241 million available to the DWR this year. State officials are quietly pushing the PUC to rejigger the formula so that the water department gets more money -- even though that would clash with terms of the Feb. 1 law. Robert Miyashiro deputy director of the Department of Finance says the emergency law was drafted poorly and has led people to believe the DWR only gets the leftover money. He predicts there will be cleanup legislation. At the request of the Davis administration the PUC is considering a plan to use a different revenue-sharing formula than the one in the state law. The proposed new formula was written in close consultation with Mr. Davis's Finance Department says PUC President Loretta Lynch who supports the initiative and is hoping to rush it through. The effort has drawn some opposition. Commissioner Richard Bilas at a recent PUC meeting questioned the legality of the commission attempting to change a formula set by the Legislature. PG&E is even more emphatic since the DWR's extra money could come at the utility's expense. The formula threatens to undo the very financial protections for the utilities that [the new law] attempted to provide the utility said in a recent filing with the PUC. As politicians and regulators wrestle with that issue the Davis administration has taken a step to reduce the outflow of state cash that also seems to conflict with the Feb. 1 law. It was widely assumed that the law required the DWR to buy any electricity the state needed to keep its lights on. However on many occasions the DWR has refused to buy power on the grounds that it was too expensive citing a portion of the new law that urges the agency to hold down costs. The task of covering any remaining shortfall has passed to the California Independent System Operator which manages the state's energy grid and is charged with buying power when necessary to avert shortages. However the ISO doesn't have any power-purchasing money of its own and the major parties it would normally bill are PG&E and Edison whose inability to pay their power bills was the reason the state started buying electricity in the first place. Amid criticism of its stance from generators utilities and Wall Street the DWR says it has started covering more of the utilities' electricity costs. The water agency is now buying 95% to 99% of what California needs in a given day says the agency's Mr. Hart. But increased buying only adds to the uncertainty about the eventual tab. The state's legislative analyst Elizabeth Hill recently recommended that lawmakers hold off considering more than $2 billion in state spending on items ranging from college construction to beach cleanups because of continuing questions about the financial impact of the electricity crisis. Like others Ms. Hill complains that the governor's office and state agencies haven't been forthcoming with information. Indeed the DWR refuses to say precisely how much power it is purchasing and at what prices though it has on several occasions gone back to the Legislature for more money. State officials say that data on its purchasing activities would give suppliers an advantage in continuing electricity-supply contract talks. State Controller Kathleen Connell who is running for mayor of Los Angeles in an April election recently announced plans to post state power-spending information on her department's Web site. But within 24 hours Ms. Connell suspended that plan after discussions with senior Davis administration officials. I feel very strongly that this information should be publicly released says Ms. Connell. I just don't want to do anything that would weaken the state's effectiveness in negotiating. In an effort to more tightly control events the governor obtained legislative approval to abolish the 26-member ISO board which was made up of everyone from utility executives to representatives of consumer groups. He then appointed a new five-member board. To ensure a quick transition the California attorney general threatened the old board members with fines of as much as $5000 each if they didn't immediately relinquish their positions. All did. I was offended at the heavy-handed treatment says Karen Johanson a former ISO board member. One of the first acts of the ISO's new board was to close a meeting about the electricity crisis. The former ISO board routinely held such meetings in public. ISO attorneys say the meeting was largely designed as a private briefing for new board members and that the organization is committed to keeping its deliberations as open as possible. The Wall Street Journal and other news organizations have unsuccessfully challenged the closure in Sacramento state court. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Gine Project- Briefing book sections DRAFT Body:: I agree. I am almost through it -- and while there are improvements per our suggestions from the first draft -- there are both substantive and format problems -- i.e. it does not read very well in places aside from substance. Will fax Amr my comments on the text and leave with DC colleagues as I will be up in the Senate on RTOs this afternoon. Thanks. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Public Policy Contacts for California Body:: I kept your contact list but now I can't find the CV you sent. Would you mind resending? Kevin Scott on 06/20/2001 02:02:00 PM Please respond to kevinscott@onlinemailbox.net To: Steve Kean Jeff Skilling cc: Subject: Public Policy Contacts for California Jeff and Steve ? As you requested I have prepared a list of my preferred public policy contacts?for California.? It is composed of professionals from an array of public private and non-profit backgrounds.? I have worked in some capacity with?each of these people?and most I know quite well.? ? Please call me for further background. ? Kevin 213-926-2626 ? Attachment - Kevin Scott - Preferred Contacts - 6-20-01.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Short Biography for Highlands Forum XVII Meeting Body:: Please update my bio to include Human Resources and add some boilerplate on Enron. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Okay so I didn't know what a DRIP is but now that I do I'm sending this to you. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: Please respond to ANDREW - 7138536278 Enron Wholesale Services - Office of the Chairman From: Mark Frevert Chairman & CEO Greg Whalley President & COO Mark Haedicke Managing Director & General Counsel Subject: Confidential Information and Securities Trading Enron Wholesale Services ('EWS') maintains official Policies and Procedures Regarding Confidential Information and Securities Trading ('Policies and Procedures') which have been revised as of November 15 2000 to reflect the new EWS structure. These policies and procedures are intended to allow us simultaneously to pursue our diverse businesses and to protect confidential information our reputation for integrity and EWS and its employees from legal liability. You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: You must certify your compliance with the Policies and Procedures within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Lance Schuler at extension 3-5419 Mark Haedicke at extension 3-6544 Alan Aronowitz at extension 3-3214 Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Transatlantic meetings Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:HAEDICKE MARK - 7138536544 ? Enron Wholesale Services - Office of the Chairman ? From:??Mark Frevert Chairman & CEO ??????Greg Whalley President & COO ??????Mark Haedicke Managing Director & General Counsel ? Subject:??Confidential Information and Securities Trading ? Enron Wholesale Services ('EWS') maintains official Policies and Procedures Regarding Confidential Information and Securities Trading ('Policies and Procedures') which have been revised as of November 15 2000 to reflect the new EWS structure. These policies and procedures are intended to allow us simultaneously to pursue our diverse businesses and to protect confidential information our reputation for integrity and EWS and its employees from legal liability. ? You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: ? ? You must certify your compliance with the Policies and Procedures within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Lance Schuler at extension 3-5419 Mark Haedicke at extension 3-6544 Alan Aronowitz at extension 3-3214 Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Lockyer Fires Earthy Attack at Energy Exec Body:: Jeff =20 FYI - Strong and colorful words from a powerful man. =20 Given Lockyer's abilities position and and ambition I would advise build= ing bridges and mending fences while this is still at the taunting stage. = He wants your attention. Knowing him I'd say that a direct and friendly= call from you or Ken today followed by a meeting would go a long way. =20 Kevin 213-926-2626 =20 =20 [IMAGE] [IMAGE] [IMAGE] [IMAGE] News Politics Entertainment music = movies art TV restaurants [IMAGE] Business Travel Marketplace jo= bs homes cars rentals classifieds [IMAGE] Sports Commentary Shop= ping [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] California= [IMAGE] [IMAGE] TOP STORIES * Bishop Asked to Quit for Defying Churc= h * Wide-Ranging Debate Reveals Much Accord * Limit on New Sea Wall= s Urged MORE [IMAGE] [IMAGE] [IMAGE] STORIES BY DATE FOR THIS SECT= ION 5/23 | 5/22 | 5/21 | 5/20 | 5/19 | 5/18 | 5/17 [IMAGE] = DAILY SECTIONS Front Page A Section California [IMAGE] Business = Sports Calendar [IMAGE] So. Cal. Living EditorialsLetters Op/Ed W= EEKLY SECTIONS Health Food [IMAGE] Tech Times [IMAGE] Highway 1 = SUNDAY SECTIONS Book Review Opinion Real Estate [IMAGE] Calendar Mag= azine Travel [IMAGE] TV Times Work Place [IMAGE] [IMAGE] [IMAGE] [= IMAGE] [IMAGE] [IMAGE] Marketplace Find a home car rental job = pet merchandise boat plane or RV classifieds Place an Ad [IMAG= E] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] L.A. Times Subscription Ser= vices Subscribe Change of Address Vacation Stops Suspend Delivery = College Discount Gift Subscriptions Mail Subscriptions FAQ [IMAG= E] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Print Ads from the Newspape= r See this week's ads [IMAGE] [IMAGE] [IMAGE] Print Edition Oran= ge County Valley Ventura County National Community Papers [IMAG= E] [IMAGE] [IMAGE] [IMAGE] Books Columnists Crossword Education = Food Health Highway Horoscope Lottery Magazine Obituaries Readi= ng by Real Estate Religion Science So.Cal. Living Special Report= s Sunday Opinion Tech Times Times Poll Traffic Weather Workplace SI= TE MAP [IMAGE] [IMAGE] [IMAGE] SHOP 'TIL YOUR LAPTOP DROPS [IMA= GE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Shopping [IMAGE] Search Prod= ucts Stores [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] = =09[IMAGE]=09[IMAGE] Wednesday May 23 2001 | [IMAGE]Print this story [I= MAGE] Lockyer Fires Earthy Attack at Energy Exec By JENIFER WARREN Ti= mes Staff Writer SACRAMENTO--In a dramatic escalation of energy cr= isis rhetoric California Atty. Gen. Bill Lockyer this week suggested the = chairman of a Houston-based power company should be locked in a prison cel= l with an amorous tattooed inmate named Spike. Lockyer who is inve= stigating whether energy firms have manipulated prices on the wholesale el= ectricity market made the comment in an interview with the Wall Street Jo= urnal that appeared Tuesday. I would love to personally escort [En= ron Corp. Chairman Kenneth] Lay to an 8-by-10 cell that he could share wit= h a tattooed dude who says 'Hi my name is Spike honey' Lockyer said. = Enron spokesman Mark Palmer called the comment counterproductive rh= etoric that does not merit a response. But other industry repres= entatives denounced the remark as outrageous especially because neither= Lockyer's office nor any investigative panel has filed charges against En= ron or other companies. You'd expect that the state's chief legal c= ounsel would file charges first and make public statements second said G= ary Ackerman of the Western Power Trading Forum an association of energy = producers and traders. We're very disappointed with his choice of words = which don't exactly fit the profile of his office. In an interview = Tuesday Lockyer said he decided to ratchet up the commentary to put [e= nergy companies] on notice that we are not afraid of them and have the w= ill to prosecute. What I'm trying to do is let these economic buc= caneers understand that if we catch them they're going to be prosecuted= Lockyer said. Just because they're multimillionaires and run big corpora= tions it doesn't provide them with immunity. The attorney general = is investigating whether power company officials tried to maximize profits= through illegal manipulation of prices on the wholesale energy market. S= everal panels including a state Senate committee and the California Publi= c Utilities Commission are conducting similar probes. On Tuesday L= ockyer announced that three power companies have agreed to turn over docum= ents subpoenaed months ago by his investigators. The attorney general went= to court to obtain the documents after the companies failed to meet a Mar= ch 19 deadline to hand them over. Lockyer said the forthcoming docu= ments would help his office as it sifts through mountains of evidence in s= earch of possible violations of antitrust or unfair business practice laws= . Evidence is accumulating that certainly infers illegal activity= Lockyer said. But we need to make sure it's compelling and clear enough = that you can convince a jury. Lockyer said he singled out Enron's = chairman because the Houston company is the world's largest energy trader. = At least one observer found Lockyer's comments refreshingly candid.= Harry Snyder a senior advocate of Consumers Union said Let Lockyer be= Lockyer. * * * Times staff writer Dan Morain contributed to this s= tory. Search the archives of the Los Angeles Times for similar stories = about: Bill Lockyer Enron Corp Kenneth L Lay Utilitiy Rates En= ergy - California Utilities - California Electricity . You will not = be charged to look for stories only to retrieve one. =09 News Politics Entertainment music movies art TV restaurants = [IMAGE] Business Travel Marketplace jobs homes cars rentals cla= ssifieds [IMAGE] Sports Commentary Shopping [IMAGE] =09[IMAGE]=09 G= et Copyright Clearance Copyright 2001 Los Angeles Times Click for permi= ssion to reprint (PRC# 1.528.2001_000043205) =09 [IMAGE] =09 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ATTORNEY CLIENT PRIVILEGDE - Draft FERC Brief on Settlement Process Body:: My suggestions are attached. Take the gloves off. James D Steffes 07/06/2001 10:04 PM To: Jeffrey T Hodge/Enron@EnronXGate Robert C Williams/Enron@EnronXGate cc: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Alan Comnes/Enron@EnronXGate Jeff Dasovich/NA/Enron@Enron Susan J Mara/NA/Enron Robert Frank/NA/Enron@Enron Ray Alvarez/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON dwatkiss@bracepatt.com Subject: ATTORNEY CLIENT PRIVILEGDE - Draft FERC Brief on Settlement Process The attached is a rough draft of a potential filing Enron would make in to Judge Wagner in the Settlement process (it is unclear if this would remain confidential per the gag order). Please provide Ray Alvarez your comments. This would be filed as early as Monday am. Jim What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Barton,Tauzin letter to Gov. Davis Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FERC course on for Thurs, July 26, 1-4 p.m. Body:: Great news. With respect to the Commissoners I think it makes sense to go back through Ellen and ask if she could set up meetings with a few commissioners ater the staff briefing. wgramm on 07/17/2001 03:23:19 PM Please respond to To: Jerry Ellig Steve Kean cc: Susan Dudley Subject: FERC course on for Thurs July 26 1-4 p.m. Susan got it done -- it'll be Thursday July 26 1-4 p.m. at FERC (a room on the 3rd floor?). Susan has talked with Bill Albrecht. He'll probably be coming in on Wed. p.m. Steve any ideas about a Commissioner strategy? (invite them to attend if the FERC folks agree ask the FERC folks to do the inviting ask the FERC folks to help set up meetings afterwards or a follow on if they like what we do and think it useful for Commissioners try to do a walkaround -- that is offer to have Jerry Bill Susan visit commissioners individually Friday a.m. after the course or Thursday a.m. before the course?) Wendy Wendy Gramm Regulatory Studies Program Mercatus Center George Mason University 703-993-4884 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Bloomberg story Body:: Any follow up questions or India press about the bloomeberg story I sent you yesterday? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential issues Body:: As requested I investigated potential government approvals or potential political interventions if India assets/investments are sold. My understanding from the India CFO (in response to my query about approvals necessary for any sell-down like we are working on for Dabhol) is that it depends to whom we sell. If we sell to an Indian company then the Reserve Bank of India (RBI) must approve taking dollars out of India. If a sale is made outside India no Indian approvals are necessary. There are however many other approvals that would need to be obtained -- specifically from lenders and counterparties pursuant to project documents. I have not analyzed these financial-related approvals. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: executives Body:: Jeff Shankman (COO of Enron Global Markets) is interested in going and would like to see the schedule. I told him you would send it to him. Jeff can also help us get our message across on the problems in California's power markets (Dasovich can fill you in). Also John ( Woody) Wodraska managing director of Azurix is interested in attending. Please get in touch with him. I haven't heard from Stan yet. Susan M Landwehr 08/07/2000 10:26 PM To: Richard Shapiro/HOU/EES@EES cc: Elizabeth Linnell/HOU/EES@EES Steven J Kean/HOU/EES@EES Joe Hillings/Corp/Enron@Enron Carolyn Cooney/Corp/Enron@Enron Subject: executives Rick--just a reminder that I am not aware of anyone from the executive ranks that are interested in attending the democrat convention at this point. I believe that you and Steve Kean had asked the question about both conventions to those folks but I wanted to make sure that we had covered the bases. Stan Horton is the president of INGAA this year and they are having an event on Sunday the 13th but I have not been made aware of whether he will be attending and whether he would be interested in partcipating in any of Enron's other events. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: House and Senate Energy Hearings Today on California/Western Electric Situation Body:: I attended both the House and Senate energy committee hearings today. House hearing was in the Barton Subcommittee (Energy & Air Quality). Senate hearing was on last week's FERC order on a soft price cap and related issues. The House witnesses were dominated by California officials: Cal Energy Commission Cal Air Resources Board Chairman of Gov Davis Generation Implementation Task Force. In addition there were witnesses from the Western Area Power Admin and Bonneville PA. The Senate witnesses were the three FERC commissioners. HIghlights Chairman Barton said it is still his intention to try to mark up the Barton bill H.R. 1647 next week (many on and off the Subcommittee doubt this will happen we are gathering political intelligence on those prospects and will report back with more information and conclusions once that is done) Chairman Barton also said he may go to California next week. There was considerable emphasis at both hearings about the alleged role that higher natural gas prices into California play in the electric power rate increases several witnesses focused on difference in alleged transportation costs for similar differences between California and non-CA states FERC at the Senate hearing said that today the commission announced a staff technical conference for later this month on all aspects of the natural gas market as it relates to California a House member from Southern Illinois coal country attacked California for using only natural gas in its new power plants. The House witnesses primarily BPA but also the California witnesses attacked the negawatt provision in sec. 102 of the Barton bill the criticism was that BPA would be forced to purchase power on the open market at a high price since it is short sell it to the DSIs under contract let the DSI sell it at market rates and capture the difference BPA witness said that thus sec. 102 would make it difficult if not impossible to implement their strategy to avoid as much as a 200 percent rate increase on 10/1/01 BPA testimony will make it tough for Members of Congress from that service region to support sec. 102. Both hearings also touched on how difficult it would be to actually devise a price cap at the House hearing none of those advocating a price cap among the witnesses could answer excellent questions about exactly how this could be done the witnesses just said cost plus a reasonable profit and said leave the details to FERC at afternoon Senate hearing Chairman Hebert had the staff bring in 15 boxes from one FP&L case to show how a price cap would take too long to bring any relief to California this summer he said last week's soft price cap is much better. Also on the price cap Rep. Walden (R-OR) got the Cal Energy Comm chair to admit that if the price caps had been in place earlier California would NOT have taken the conservation and new generation steps that it has taken recently. The interplay among the FERC commissioners was much more contentious than it was a House hearing on Tuesday although it could have been worse when Senate Chairman Murkowski (R-AK) said that help is on the way in the form of the nominees for the two vacancies Sen. Dorgan (D-ND) made a comment that suggested that the confirmation process will not be smooth the same concern came from the interplay among the Senators which was also somewhat contentious at times. Please advise if you have any questions or would like further details. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Something to shoot at--California Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Memo For Thursday Meeting Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: VP Candidate Greg Shea Body:: OK by me. From: John J on 04/30/2001 11:30 AM Sent by: Kimberly Hillis/ENRON@enronXgate To: Wade Joannie Williamson/Corp/Enron@ENRON Cliff Baxter/ENRON@enronXgate James A Hughes/ENRON@enronXgate Steven J Kean/NA/Enron@Enron Mike McConnell/HOU/ECT@ECT Rebecca McDonald/ENRON@enronXgate Mark Metts/Enron@EnronXGate Stephanie Harris/ENRON@enronXgate Maureen McVicker/NA/Enron@Enron Loretta Brelsford/ENRON@enronXgate Dolores Fisher/Enron@EnronXGate Sherri Sera/Corp/Enron@ENRON Jana L Connie Blackwood/ENRON@enronXgate Mrudula Cliff Baxter/ENRON@enronXgate Mark Frevert/ENRON@enronXgate Nicki Daw/ENRON@enronXgate Lucy Marshall/Enron Communications@Enron Communications Kathy McMahon/NA/Enron@Enron Jeremy Blachman/HOU/EES@EES Philippe A Bibi/ENRON@enronXgate Raymond Bowen/ENRON@enronXgate Michael R Brown/LON/ECT@ECT Harold G Buchanan/HOU/EES@EES Rick Buy/ENRON@enronXgate Richard Causey/Corp/Enron@ENRON David Cox/Enron Communications@Enron Communications David W Delainey/HOU/EES@EES James Derrick/ENRON@enronXgate Steve Elliott/Enron Communications@Enron Communications Andrew S Fastow/ENRON@enronXgate Ben Glisan/HOU/ECT@ECT Kevin Hannon/Enron Communications@Enron Communications Rod Hayslett/ENRON@enronXgate Stanley Horton/Corp/Enron@Enron Louise Kitchen/HOU/ECT@ECT Mark Koenig/Corp/Enron@ENRON Kenneth Lay/Corp/Enron@ENRON Dan Leff/HOU/EES@EES Danny McCarty/ET&S/Enron@Enron Jeffrey McMahon/ENRON@enronXgate Mark S Muller/HOU/EES@EES Cindy Olson/Corp/Enron@ENRON Lou L Pai/HOU/EES@EES Ken Rice/Enron Communications@Enron Communications Matthew Scrimshaw/LON/ECT@ECT Jeffrey A Shankman/ENRON@enronXgate Jeffrey Sherrick/ENRON@enronXgate John Sherriff/LON/ECT@ECT Jeff Skilling/Corp/Enron@ENRON Marty Sunde/HOU/EES@EES Greg Whalley/HOU/ECT@ECT Thomas E White/HOU/EES@EES G G Garcia/ENRON@enronXgate Susan Skarness/ENRON@enronXgate Karen K Heathman/ENRON@enronXgate Sharron Westbrook/Corp/Enron@ENRON Kay Chapman/HOU/EES@EES Bridget Maronge/ENRON@enronXgate Inez Dauterive/HOU/ECT@ECT Carol Ann Brown/Enron Communications@Enron Communications Cindy Stark/Corp/Enron@ENRON Rosalee Fleming/Corp/Enron@ENRON Tori L Wells/HOU/ECT@ECT Cathy Phillips/HOU/ECT@ECT Sue Ford/ENRON@enronXgate Karen Owens/HOU/EES@EES Dorothy Dalton/Enron Communications@Enron Communications Mercedes Estrada/Enron Communications@Enron Communications Christina Grow/ENRON@enronXgate Lauren Urquhart/LON/ECT@ECT Laura Taylor/ENRON@enronxgate Judy G Smith/HOU/EES@EES Suzanne Danz/Corp/Enron@ENRON Peggy McCurley/ENRON@enronXgate Marsha Schiller/ENRON@enronXgate Tammie Schoppe/HOU/ECT@ECT Kimberly Hillis/ENRON@enronXgate Jennifer Burns/ENRON@enronXgate Sharon Dick/HOU/EES@EES Beverly Aden/HOU/EES@EES Kathy Dodgen/HOU/EES@EES Leah Rijo/Enron Communications@Enron Communications Kathy Campos/ENRON@enronXgate Julie Armstrong/Corp/Enron@ENRON Kelly Johnson/Corp/Enron@ENRON Rebecca Carter/Corp/Enron@ENRON cc: Subject: VP Candidate Greg Shea I would like to pursue an offer to Mr. Shea prior to the next Executive Committee meeting on May 7 2001. Please forward your comments or questions by Tuesday May 1 2001 so that I can extend the offer by Wednesday May 2 2001. You will find attached the recommendation letter and his resume. Regards John Lavorato Tammie Schoppe on behalf of John Lavorato. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: [Second Delivery: WPTF Friday Amen Burrito] Body:: Sorry about this gang but my new computer messed up the e-mail list. It's 4 am and I think I have fixed it. Maybe. Bear with me if you are getting this for the second time this morning. gba X-Mozilla-Status2: 00000000 Message-ID: <398A81DA.E883D290@idt.net> Date: Fri 04 Aug 2000 01:42:26 -0700 From: Gary Ackerman Reply-To: foothi19@idt.net Organization: Foothill Services X-Mailer: Mozilla 4.74C-CCK-MCD {C-UDP EBM-APPLE} (Macintosh U PPC) MIME-Version: 1.0 To: webmaster Subject: WPTF Friday Amen Burrito Content-Type: multipart/alternative THE FRIDAY BURRITO ...more fun than a fortune cookie and at least as accurate. Everyone is getting into the act. When I started this gig I was the only guy in town writing to folks like you about the power industry in California. I wrote about what?s new what?s happening and all the important stuff. This week Governor Gray Davis decided to write his own Burrito. His epistle got more press than mine but why is he muscling in on my turf? Not to be outdone PUC President Loretta Lynch released a report which looks into every facet of California?s power business. No stone left unturned. I?m telling you there isn?t enough room in this business for all of us. They need to clear out. With people like Herr (Hair?) Peace Governor I?m-Not Mr.-Rogers Davis and Let?s Do Lynch who needs a Friday Burrito? They re-define our reality each week with mind-numbing aplomb. For example starting in early June the PX was ordered to compete for business against other Qualified Trading Vehicles. Then two weeks later the Energy F_hrer legislated that idea to an early death which kept the status quo for at least one year. This week the PUC approved 5-year bilateral deals for PG&E and SCE thereby opening the PX to competition and emasculating the PX?s Block Forward Market. Zip bam boom. I can?t wait to see what next week will bring. I hear Senator Bowen is holding Committee hearings on re regulating the industry and the Governor?s new Energy Security Council will meet to decide six things: What?s for lunch? Who will sit at the head of the table? Does anyone have good seats for next week?s Democratic convention? Is there anyone we haven?t indicted yet in the power industry? Who will crank up the air conditioning in this room? It?s getting too warm. Then they will collect data from innocent businesses under subpoena ignore the facts and publish a report. It makes one want to take a deep breath and inhale the scented fumes of democracy. You know I can?t think about where to begin so let?s start somewhere. >>> Things on the Island of California @@@ Is there anyone left at SDG&E with a brain? @@@ The PUC issues its scathing report @@@ The ISO invokes $250 price caps. Duh! >>> Things at the throne of FERC @@@ Amen for the Morgan Stanley Order >>> Odds and Ends (_!_) >>> Things on the Island of California @@@ Is there anyone left at SDG&E with a brain? Well the answer very clearly is no. I have been astounded by repeated attempts of SDG&E?s most senior people to ape humans but instead they mimic apes. Consider the following. First they waltz their default customers into the summer with little of no protection from price spikes in the wholesale market. Forgivable in that it is human to err. The prices skyrocket in June and they start looking for who to blame. _Must be them damn independent generatorsO say their managers. Gary Cotton informs the ISO Governing Board that hedging SDG&E?s position in the Block Forward Market wouldn?t have made any difference. There?s one nobel laureate who missed his prime. Next under pressure they ask for help from suppliers and anyone else who will assist the utility and their customers. Nine offers show up at their table and they can?t choose any of them. Again Mr Cotton tells his fellow ISO Governing Board members that these things take time and we don?t to rush since there are many legislative barriers and well the surfing was good this week so why spoil it? Now they are in a panic because the Energy F_hrer is visiting old ladies living in trailer parks advising them not to pay their SDG&E electricity bill and to continue to operate their air conditioners. SDG&E puts a full page ad in the local newspaper telling everyone that SDG&E is doing everything it can to lower their electric bills including asking the ISO for a $250 price cap but the public can help by calling the ISO [address and phone number provided in the ad] and urging them to lower the cap. I always thought the location of the ISO was a State secret for security reasons. No secrets in San Diego. But we are not done. No sir we are not. Those buffalo heads who run that company decide they will win a gold star on their collective foreheads and implement one of the four resolutions passed by the Electric Oversight Board. The one they pick is to petition FERC on an expedited basis to cap at $250 the price at which sellers may bid energy or ancillary services into the ISO and the PX. The primary reason is that Western power markets are not workably competitive. In other words they want FERC to set a max price on what generators can sell in addition to the price limit at which the ISO can buy! What I find most astounding about this double talk is that SDG&E continues to collect tons of money from the sales of regulatory must run energy into the PX. These are sales from their stranded assets. Their grief hasn?t abated their greed. So to recap SDG&E missed the boat on price hedging failed to win consumer confidence in public meetings asked for help from suppliers and did nothing in response then filed at FERC to cap the sale price because the wholesale market into which they sell (over-priced?) energy is not workably competitive. Too much time in the direct sun light. >>> Things on the Island of California @@@ The PUC issues its scathing report The PUC report released yesterday is a gem with which I have not spent enough time. I only read the Executive Summary and that only because our counsel Dan Douglass forwarded me a copy. Let me pick out some of the gems in President Lets Do Lynch?s burrito. I would recommend reading the whole text if you have time and if you seek perverse entertainment. _California is experiencing major problems with electricity supply and pricing caused by policies and procedures adopted over the past ten years. _ Since June wholesale prices for electrical power in California have increased on average 270% over the same period in 1999 resulting in over $1 billion in excess payments for electricity. _Hot weather aging power plant and transmission infrastructure and dysfunctional bidding behavior in the wholesale power markets combined to drive prices up ... _Because of serious market defects and tight supply of electricity purchasers of California power will likely pay billions more in electricity costs this year. Moreover these price increases do not necessarily fund new investments in electricity supply or delivery reliability - they may flow solely to power producer profit margins. _Despite the Electricity Oversight Board's legislative mandate to oversee those institutions we have been unable to obtain [bid] data. Nevertheless ... we believe enough evidence of questionable behavior exists that the Attorney General should conduct an investigation into these statewide market practices coordinating with other State agencies including the PUC and the EOB. Such an investigation would provide the factual foundation that California policy makers and regulators need to recover any illegally obtained profits. _A momentous consequence of California's attempt to create a market in electricity is that the federal government now regulates California's electric system. Washington D.C. now controls pricing decisions directly at the wholesale level and indirectly at the retail level and to the extent that supply incentives are correlated to prices Washington D.C. now affects California's ability to attract new investment in power plants. _Past administrations' willingness to cede the State's authority to the federal government combined with the legislative creation of two non-public supervisory organizations that have no duty to protect the public or consider the retail customer. The Independent System Operator (ISO) and the Power Exchange (PX) the nonprofit private corporations that operate the State's transmission system and control wholesale pricing policies are governed by boards whose members can have serious conflicts of interest. Some of these board members or their companies financially benefit from higher prices in electricity markets. Neither of these private organizations is accountable to the State or its consumers .... _Despite the federalization and the fragmentation of the State's electric services the State of California should protect its businesses and consumers from cartel pricing collusive behavior inadequate power plant maintenance and lack of market planning for adequate electricity supplies. _California consumers and businesses deserve to know in advance - as San Diegans did not this summer - how and when the price of an essential service like electricity will double. California is now largely constrained by federal mandates from providing comprehensive retail price relief as long as wholesale prices remain so high. If California tried to re-impose a price freeze in San Diego now federal regulators would likely prevent that action. ... Short-term price relief however cannot resolve market gaming or fundamental wholesale pricing problems controlled by federal regulators. _We have been precluded from obtaining the data necessary to know if the ISO and PX failed to detect manipulation and gaming on several fronts. We do not know how market players acted in price offering and bidding and scheduling. The FERC has just announced an inquiry into national pricing and energy market issues. California should not wait for national findings before it investigates California market practices. We recommend that the California Attorney General immediately subpoena relevant records and data to determine the pricing and offering behavior of market participants the actions of the ISO and its board members and the actions of generators in supplying California's energy needs. _Ten Actions to Consider or Act Upon to Prevent Current Electricity Problems From Spreading in 2001: ... 2. Create a California Energy Council modeled on the National Security Council to unify State action to resolve energy problems and to perform integrated energy planning 3. Ask FERC for extended wholesale price cap authority to moderate California wholesale market pricing 4. Ask FERC to recognize the defects in the California and western regional markets and find that no competitive market exists in California power markets ... 8. Eliminate potential conflicts of interest in ISO/PX stakeholder boards 9. Improve California's ability to obtain ISO and generator data and enhance the State's enforcement capability for power plant maintenance price manipulation and generation gaming consistent with protection of proprietary business information 10. Provide the EOB with effective enforcement ability and additional oversight authority for the ISO and PX. _Ten Issues to Consider or Act Upon Within the Next Six Months: ... 4. Streamline state power plant siting procedures consistent with environmental requirements and prioritize applications to advance clean BACT+ power plant proposals. 5. Institute use-it -or- lose-it permitting power plant licensing and emissions credits rules to ensure power plants get built ... 8. Reform PX pricing protocols and structures to lower wholesale and retail prices and reduce excess profitsO I told you I don?t need to write a Burrito anymore. The Democrats in Sacramento are doing that for me. Welcome comrade. >>> Things on the Island of California @@@ The ISO invokes $250 price caps. Duh! It is really hard to describe the drama of an ISO Governing Board meeting especially when our favorite topic arises. It seems the only time the Board becomes animated is when one of three issues are on the agenda: price caps FTRs and priorities for software enhancements. Otherwise its pretty much hum-drum. %Round and %round we went once again. A few more forced votes tipped the scale in favor of the cap. There were 15 yes votes which included a forced yes vote from our friend Jerry Toenyes by order of Secretary of Energy Mr. Richardson. [Jerry did you realize that the last letters of your name could be re-arranged to spell _NO ET YESO? Kind of a french thing.] I?m sorry about that vote Jerry. You still go in my book as one of the brave and bold for standing up to that sort of intimidation for so long. Your picture in the SF Chron said it all. The brave souls who stood tall and voted NO included David Parquet (Enron) Jan Smutny-Jones (IEP) Barbara Barkovich (CLECA) Caolyn Kehrein (CMA) Dan Kirshner (EDF) and Stacy Roscoe (Procter & Gamble). Now I must admit that Dynegy?s Greg Blue did help by voting a Texas No spelled _A-B-S-T-A-I-NO. I have instructed Dynegy trader Dave Francis in Houston to work with Greg to correct that problem. We?re going to work things out. The Energy F_hrer addressed the Board again. I didn?t mind that I only had a few brief very brief moments to address the Board and Herr (Hair?) Peace got over 20 minutes. That didn?t bother me at all. He did more damage to himself in 20 than I could do in 2. He blasted away at everyone who opposed him. He pined about Camden quitting the Board. He said he knew how prices and markets work that it isn?t the way those academic egg-head FERC-loving economists tell you who pray to the gods of competition. He lambasted WAPA for withholding generation to protect fish and wildlife (what was that all about?). He predicted that on Thursday?s PUC meeting he and all the other powerful Democrats Republicans and angry citizens of San Diego would demand that the PUC impose a rate cap on retail electric rates in San Diego that are just and reasonable (it didn?t happen). And on and on and on. This man is very delusional. He believes that Steve and only Steve Peace can save the world. He believes that political will trumps judicial quasi-judicial or independent Board actions. This man makes relevant all the abstract musings of the philosopher Friedrich Nietzsche (1844-1900) ... The will to power the ?bermensch the transvaluation of values etc. But we are getting under (uber?) his skin with the help of the press. Wednesday afternoon I called Commissioner Dick Bilas to see if he thought whether the next day?s PUC meeting was going to be a roll over. Dick said he got a call from Peace and that Peace said he would not come to the meeting. Apparently Peace had received a lot of press and all of it bad. That?s the thin line of freedom which keeps tyranny at least one step away from our front door. >>> Things at the throne of FERC @@@ Amen for the Morgan Stanley Order And now the good news. You deserve this. FERC gave the California market a little wiggle room last Friday. FERC issued a last minute reply to the complaint by Morgan Stanley Capital Group relating to the ISO?s intent to lower the price cap. FERC denied the complaint but they didn?t waste time with an Order to simply deny a complaint. FERC danced on the head of the ISO and pulled the bite out of the price cap. Here are some excerpts: _We accepted this [Amendment 21] not because it was a cap on sellers? prices but because it would promote order and transparency in the market by clearly telling sellers of the maximum price the ISO was willing to pay and allowing sellers to make informed economic choices on whether to sell in the ISO market or to sell elsewhere... _ ... The ISO has no more or less ability to procure capacity and energy than any other buyer of these services ... If the ISO is unable to elicit sufficient supplies at or below its announced purchase price ceiling (because generators are free to sell elsewhere if they choose) it will have to raise its purchase price to the level necessary to meet its needs. ... Therefore an increase in out-of-market (OOM) calls for generation may be necessary to maintain system reliability. Because the current payment for OOM is not subject to a maximum purchase price the resulting overall payments may be higher. _To the extent the ... ISO Board resolution contemplates implementing a directive that generators must bid their capacity into the ISO markets under any circumstances (e.g. when system load exceeds 38000 MW) such a requirement is not permitted by our ... Order and the ISO tariff. ... Future implementation of the ISO Board resolution with regard to a requirement to sell would require significant revisions to the ISO market rules. Such market changes could not become effective absent a corresponding amendment to the ISO tariff which would have to be filed under section 205 of the FPA.O Well. What do you think about that? Just wait. Here is what the sleeping bear Commissioner Hebert said in his concurring remarks: _Getting to the bottom of the problem in my view requires us to begin a proceeding to rescind our approval of the ISO as the operator of the California grid. The record supports such a move. ... A memorandum to the ISO from a stakeholder who resigned from the governing board eloquently brings to our attention repeated attempts to undermine the independence of the ISO. The memorandum also thoughtfully outlines consequences to the markets of a return to %command and control.? _Because these allegations come from a non-market participant especially should we take heed. We must also take notice of the public pressure on the Board to compromise its independence.O Amen brother amen. >>> Odds and Ends (_!_) As you can imagine this week like an endless string of weeks before this has been interminable. I get about three phone calls a day from press reporters very little of which ever sees print. My shtick is just too complex for casual readers. But I do notice that the reporters are asking better questions. The public is becoming more savvy. The information flow is moving in our favor and will disarm the forces of evil in about 10 years. I have other problems on my mind. I am working on a new computer system. Really it?s just an upgrade of an older computer that is a bit faster than the laptop I tried to upgrade very unsuccessfully. As a result of the all the new hardware and software I purchased my office looks like a war zone with an odd mix of PUC service copies computer documentation and diskettes laying all around. Quite a mess. Prepare for the future. Our next general meeting is scheduled for Thursday and Friday October 5 and 6 at Moro Bay. Barb Ennis will prepare a blurb for us in next week?s Burrito about room reservations timing golf etc. Our guest speakers will include MSC Chairman Professor Frank Wolak who will talk on the subject of his choice Ms. Irene Moosen of Grueneich Resource Advocates who will make a presentation on the distributed generation case before the PUC and William Freddo of PG&E National Energy Group who will give us some education on operating a power plant inside the New England ISO. Now for your daily bread provided this week by Dan Douglass. Last week we had a joke about Catholics. This week it?s agnostics. ===================== An atheist was taking a walk thru the woods admiring all that the accident of evolution had created. What majestic trees! What powerful rivers! What beautiful animals! he said to himself. As he was walking alongside the river he heard a rustling in the bushes behind him. As he turned to look he saw a 7 foot grizzly bear charging towards him. He ran as fast as he could up the path. He looked over his shoulder and saw that the bear was closing in on him. He tried to run even faster so scared that tears were coming to his eyes. His heart was pumping frantically as he tried to run even faster but he tripped and fell on the ground. He rolled over to pick himself up and saw the bear right on top of him raising its paw to kill him. At that instant he cried out Oh my God! And time stopped. The bear froze. The forest was silent. The river even stopped flowing. A bright light shone upon the man and a voice out of the sky said You deny my existence all these years teach others I don't exist and even credit my creation to a cosmic accident and now do you expect me to help you out of this predicament? Am I to count you as a believer? The atheist ever so proud looked into the light and said It would be rather hypocritical to ask to be counted as a believer after all these years but could you make the bear a believer? Very well said the voice. And the light went out the river flowed the sounds of the forest continued and the bear brought both paws together bowed his head and said Lord I thank you for this food which I am about to receive. ================== Amen. And have a great weekend. Oh and thanks to all of you who sent me happy birthday wishes. It was very much appreciated. KSB gba - att1.htm What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Refund Cases Timelines--Confidential Atty Client Work Product Body:: The DC Team (Linda Robertson Ray Alvarez) attended and reported on today's prehearing conference in the California case. The schedule has moved back about a full month mostly due to the time required by PX and CAISO to produce mitigated market clearing prices and to re-run settlements based on those revised prices. Testimony by Enron on what it is owed is now not due until October 26. In addition to adopting this schedule the ALJ reported that the FERC likely not rule on petitions for rehearing of the July 25 order until October 15 2001. A revised schedule is attached. (To see how it has changed you can toggle Track Changes | Hightlight on Screen on and off) The PNW case is moving along on schedule changes attached are corrections rather than actual changes to the schedule. Notably in today's case Seattle and Tacoma waived all cross on TFG witnesses including Enron's. Alan Comnes What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Star Wars Event - Monday, 6/11/01 Body:: Thanks I will attend. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: ticket Body:: Pani Urszulo Czy to jest Air France? Vince What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Please put on my calendar and call to confirm my attendance. thanks ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Organizational Changes Body:: Mary -- see attached Stacy Guidroz@ENRON_DEVELOPMENT 09/22/99 09:36 PM To: Steven J Kean@EES cc: Subject: Organizational Changes The following is a message from Sanjay Bhatnagar: Organizational changes in India (South Asia) Region which includes India Bangladesh and Sri Lanka. The team is lead by Sanjay Bhatnagar CEO. Wade Cline has joined the team as the Chief Operating Officer. Other management appointments include: (1) Bobby Farris will lead all development efforts in the region (2) Raj Thapar will lead the M&A efforts (3) Bangladesh will continue to be managed by David Howe who will report in to Bobby Farris (4) P. Sreekumar leads up the accounting function as Chief Accounting Officer assisted by Carol Hoes in Houston (5) Neil McGregor heads up the Dabhol Power Company as its President and reports directly into Sanjay and Wade (6) Communication is currently being lead by Sanjay (7) Ranabir Dutt leads the Finance Team What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Follow Up On California Information Body:: Alan and I spoke about point #2 on the comparison benchmark. At this point we may be able to just say it is based on a comparison of the contracts with today's forward market and gloss over the exact forward curve we used. Of course if there is a way to come up with a similar number using publicly available data (or if we are willing to provide our numbers if pressed) then all the better. In the mean time should I hold off on using the $13.8 billion number until I hear back from you about the conversation with Steve? Also do I understand correctly from Alan that the $13.8 billion figure is NOT comparing the long term contracts California signed with recent spot market prices but rather is a comparison of the contracts to our present forward pricing curves? From you e-mail it is the latter I take it. As to point #1 on the deal last year we just need a similar back of the envelope calculation on what California could have saved had California taken us up on the offers we and others made. Any guidance on where to get that would be most helpful. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Report for Prof. Duffie Body:: Amitava Let's talk about it on Monday. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EES Associate and Analyst Mid-year 2001 PRC - SAVE THE DATE Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ross Perots EMS company Body:: We can create significant mutual benefit by partnering with a firm which is focussed on developing IT systems for bulk power systems: We need to take our deregulation model to the next level of detail by having IT solutions which will support our view of how the market ought to work. The IT firm would benefit from our access to the policy makers (domestic and international) whose decisions will make the IT firm's systems either successful or obsolete. Call me if you would like to discuss. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enrons Global Asset Management Conference Body:: I think you or someone in your group should cover this. The attendees are operations focussed and may be interested in issues such as siting interconnection and environmental issues. Also from a more macro perspective what kinds of demands the new industry structure may place on operators -- the importance of flexibility in asset operations (ie the premium the market will place on quick response) or the challenges of different scheduling regimes between the gas and power markets. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Senator Dunn Hearing Body:: Can you circulate the link to Cal TV again? Scott Govenar on 07/16/2001 01:58:41 PM Please respond to To: Ban Sharma David Leboe Eric Letke Jennifer Thome Ken Smith Bev Hansen Hedy Govenar Miyung Buster Janel Guerrero Robert Frank Mike Day Leslie Lawner Harry. Kingerski@enron. com Karen Denne Steven Kean Alan Comnes Susan J Mara Paul Kaufman Jeff Dasovich Jim Steffes Rick Shapiro cc: Subject: Senator Dunn Hearing THE SELECT COMMITTEE TO INVESTIGATE PRICE MANIPULATION OF THE WHOLESALE ENERGY MARKET WILL MEET ON WEDNESDAY JULY 18 AT 9:30 A.M. IN ROOM 3191 TO REVIEW COMPLIANCE WITH SUBPOENAS FOR DUKE DYNEGY RELIANT AES NRG AND WILLIAMS. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Angle Master Invention Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - JB 004 Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Speak to DFSC - Sharon Murphy, per Gary von Fischer, in 49C1 Body:: Moved to 11:00 per Larry Trybus Please address issues in 889 OASIS in addition to deregulation material You will have an hour to speak What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL (The Manifesto) Body:: To: Ad Hoc Committee Dear Colleague Several of you have pointed out that the Manifesto is a bit long. We will endeavor to shorten it somewhat which will be possible as there is some duplication however more importantly we plan to add an executive summary which will be the editorial link version that most will read. I hope to get that out by 5:00 PM today. Thanks David David J. Teece Director Institute of Management Innovation and Organization F402 Haas School of Business #1930 University of California Berkeley Berkeley CA 94720-1930 Phone: (510) 642-1075 Fax: (510) 642-2826 What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions Body:: California Adopts Variable Pricing Raising Ire of Generators Traders The Wall Street Journal 10/30/00 Enron Offers Cash To Help Azurix Take Itself Private The Wall Street Journal 10/30/00 Companies: U.S. Companies The Wall Street Journal Europe 10/30/00 Wessex switch likely The Times of London 10/28/00 Enron water unit could go private under loan plan Houston Chronicle 10/28/00 Quietly Bush's team talks about transition Plenty of folks in Austin would love to follow Bush to D.C. Austin American-Statesman 10/28/00 Dynegy: Calif Price Caps Will Compromise Elec Reliability Dow Jones Energy Service 10/28/00 SEC Filing Shows 3rd Parties Contacted Enron About Azurix Dow Jones News Service 10/27/00 Enron offers to buy out Azurix Financial Times October 27 2000 California Adopts Variable Pricing Raising Ire of Generators Traders By Rebecca Smith Staff Reporter of The Wall Street Journal 10/30/2000 The Wall Street Journal A4 (Copyright (c) 2000 Dow Jones & Company Inc.) LOS ANGELES -- In the latest attempt to fix California's troubled deregulated energy market officials adopted a unique variable-pricing plan that already is being criticized by power generators and traders as unworkable and praised by utilities and consumers as much needed protection against gouging. Under the plan adopted late last week by the governing board of the California Independent System Operator or ISO a quasipublic agency responsible for maintaining electricity reliability in the state the cap on wholesale power will be reset hourly from about $65 per megawatt hour at low-demand times to no more than $250 an hour at periods of high demand. It was the third time this year that officials effectively lowered the price cap on wholesale electricity in a bid to contain -- so far unsuccessfully -- soaring total power costs. The move underscores the chaotic atmosphere prevailing in California's power market after a two-year-old experiment in deregulation has come undone. In other deregulated markets such as New York and New England prices are capped at $1000 per megawatt hour which are intended to be low enough to prevent market abuse but high enough to give generators incentive to build new plants. California's system was supposed to work the same way. But because utilities in California divested themselves of the bulk of their plants but weren't allowed to lock in fixed-price supply contracts unlike in the other markets merchant generators have had much greater sway over prices here on the spot market where most power trades. During the first nine months of the year the average price of wholesale electricity was $90 per megawatt hour in California triple the price of a year earlier. Even on cool days in October the price generally has remained above $100 per megawatt hour. California utilities have lost money on those power purchases because their customers' rates are frozen at $54 to $65 per megawatt hour far lower than the average price utilities have had to pay for that power. The deficits exceeded $5 billion in the June-to-September period. California utilities buy the power used by their customers from the state-sanctioned auctions administered by the ISO and a sister organization the California Power Exchange. In New York and New England by comparison less than 20% of power is purchased from the spot markets because utilities there were able to sign the fixed-price contracts which California utilities weren't allowed to do. The price-cap decision passed last week by a vote of 13 to 10 primarily with support from utilities and board members representing consumer interests. It was pushed aggressively by Pacific Gas & Electric Co. and Southern California Edison the state's two big investor-owned utilities that have gotten caught in the price-spike vise this year. Some ISO members say they had no choice but to support the measure to ratchet down price caps. We're going after the windfall profits said S. David Freeman general manager of the Los Angeles Department of Water and Power who voted for the measure. What we've got now is a market accustomed to ripping off the consumer. This can't be allowed to go on. But other experts said the hasty measure may make California's problems even worse. The short-term regulatory fix is always to fix prices said Pam Prairie director of the Institute of Public Utilities at Michigan State University in East Lansing. But there's a real danger you'll set prices too low and make your supply problems even worse. Other economists agreed. At best this is poorly administered cost-based regulation said Frank Wolak an economics professor at Stanford University who sits on an independent market-monitoring committee at the ISO. At worst it creates all sorts of perverse market incentives. For example it may increase the problem of megawatt laundering on hot days in which in-state generators sell power to out-of-state customers who then sell it back into the state effectively bypassing the cap. Likewise it could encourage generators to build new plants outside of California rather than where they are needed near its major cities also to avoid the cap. In the end it could increase stresses to the state's already overburdened transmission system. In fact the decision already has brought to a halt the state's forward electricity market which allows wholesale customers to sign contracts for power they will use in the future. The market had been trading as much as 1000 contracts a week. On Friday there was practically no activity. This decision shows the height of lunacy said Rick Shapiro a managing director at Enron Corp. the giant Houston-based energy trader. Mr. Shapiro said Enron and other generators will file appeals at the Federal Energy Regulatory Commission asking that the new pricing formula be rescinded. It is possible the FERC may throw out the pricing formula anyway. It is expected to issue a major order on Nov. 1 directing changes in California's market structure. That order will include its determination of the effectiveness of price caps. It also is expected to judge the merits of the governance structure at the ISO which has lately been marked by infighting. Recently consumer groups have charged that the ISO board has put the business interests of its members ahead of members' fiduciary duty to California residents. The most recent price-cap measure was approved over the objections of executives at the ISO whose job it will be to implement the formula. ISO Chief Executive Terry Winter said the measure is flawed because it doesn't take into account the amount of power available to the California market. Mr. Winter fears the caps will place the state at a disadvantage relative to neighboring states with no price caps. About 11 states are electrically interconnected in the West meaning power can be moved between them and chase the highest prices. We keep getting accused of making our market too complicated Mr. Winter said. Then along comes this proposal with caps that would adjust repeatedly throughout the day depending on demand. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Enron Offers Cash To Help Azurix Take Itself Private By Rebecca Smith Staff Reporter of The Wall Street Journal 10/30/2000 The Wall Street Journal A12 (Copyright (c) 2000 Dow Jones & Company Inc.) Enron Corp. offered to lend Azurix Corp. an Enron spinoff $275 million so that it could take itself private. Enron which has been frustrated with the global water company's performance suggested Friday that public shareholders receive a cash offer of $7 a share for their Azurix stock. While nearly double the stock's value prior to the offer the suggested price nevertheless was far below the $19 at which Azurix made its debut in 1999. An Azurix spokeswoman said the board on which Enron has seats had not yet decided how to treat the Enron offer. An Enron spokesman said that taking the company private would give us more opportunity to directly affect our investment. In 4 p.m. New York Stock Exchange composite trading Friday Azurix soared $3 to $6.56 in heavy trading. Azurix had hoped to create a splash by doing to the water business what Enron had done to the energy business -- increase competition and provide trading skills capable of creating new financial products out of old commodities. But Azurix stumbled nearly from the outset. Deregulation of the water business and government privatizations of water systems on which it was counting were slow to come crimping growth opportunities and profit. And Enron accustomed to higher faster returns grew impatient with the capital-intensive water business. The company's first chief executive Rebecca Mark a onetime head of Enron's international division resigned in the summer with the agreement of Enron executives who said it was time for new leadership. The incoming chief executive John Garrison said he would look for buyers for some of the company's businesses he was unavailable to comment Friday. Ms. Mark was believed to be considering making an offer for some of those businesses herself. She declined a request for an interview. In its letter to Azurix officers Enron said the water company received four offers from prospective suitors after Ms. Mark's departure the best of which came from an unidentified bidder who offered $7 a share and went through a lengthy due-diligence process before backing down apparently spooked by Azurix's cash flow capital structure tax considerations and some securities litigation. In its proposal letter made public Friday Enron said it concluded that there is no other buyer willing to pay the $7 and so proceeded with its own offer. But Enron said it won't try to limit Azurix's ability to negotiate a better deal with others should they come forward. Finally Enron noted that Azurix had considered various partial or full-liquidation alternatives but said they didn't seem likely to produce more than $7 a share. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Companies: U.S. Companies 10/30/2000 The Wall Street Journal Europe 5 (Copyright (c) 2000 Dow Jones & Company Inc.) Enron Offers Loan to Azurix Enron Corp. offered to lend Azurix Corp. an Enron spinoff $275 million (327.6 million euros) so that it could take itself private. Enron which has been frustrated with the global water company's performance suggested Friday that public shareholders receive a cash offer of $7 a share for their Azurix stock. While nearly double the stock's value prior to the offer the suggested price nevertheless was far below the $19 at which Azurix made its debut in 1999. (Staff) Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Business Wessex switch likely Adam Jones in New York 10/28/2000 The Times of London News International 2W 64 (Copyright Times Newspapers Ltd 2000) Wessex Water's American parent company is likely to be taken private after a disastrous 14-month spell as a quoted company. Wessex which provides water services to the South of England was bought by Azurix in 1998 for Pounds 1.6 billion. Azurix wanted to use Wessex's expertise in privatised water supply to build a global business. However since listing at $19 a share in June last year Azurix stock has gone into freefall closing at less than $4 earlier this week. Azurix slumped because it drastically misjudged the number of privatisation opportunities. It emerged last night that Enron the Texan energy and trading company that is Azurix's biggest shareholder has taken the unusual step of offering to lend Azurix $275 million (Pounds 190 million) to buy its publicly held shares thereby taking it private. The Enron proposal would value Azurix at about $800 million or $7 per share - 63 per cent less than the IPO price. Enron would control Azurix and Wessex Water if it went private. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. BUSINESS Enron water unit could go private under loan plan NELSON ANTOSH Staff 10/28/2000 Houston Chronicle 3 STAR 1 (Copyright 2000) Enron offered Friday to lend Azurix its struggling water affiliate about $275 million so Azurix can go private by purchasing 38.6 million shares that are publicly traded. The deal would have Azurix buying back its stock at $7 per share about double what the shares were trading for Thursday. That's a big comedown for Azurix shares which sold for $19 each when the Houston company went public in June 1999. The maneuver technically can be called a take-under said analyst Carol Coale of Prudential Securities in Houston. She also described it as Enron's least painful solution for what to do with the venture that never lived up its ambitious plans. Nothing about Azurix has been positive for Enron in my view said Coale. This is a solution to a problem. Azurix spokeswoman Diane Bazelides said its board is studying Enron's proposal. She added that it was too early to comment on the offer because the proposal's structure had not been outlined. Enron imposed no deadline for a decision by Azurix but reserved the right to withdraw the offer if Azurix's position with prospective customers and employees deteriorated. One of Enron's conditions is that Azurix not sell any major assets before the buyout. The deal would not change Enron's large stake in Azurix said Palmer. It owns a third while the other third is owned by the Atlantic Water Trust in which Enron owns a 50 percent voting interest. The proposal's advantages include giving public shareholders a premium to the market price said Enron spokesman Mark Palmer. The common stock of Azurix zoomed Friday on the news gaining $3 to close at $6.56 on the New York Stock Exchange. Becoming a private company would give Azurix management greater flexibility in restructuring. Coale said it would reduce Azurix's general and administrative costs helping it to bid against lower- cost foreign competition particularly two big French companies. Azurix's high cost structure has been its primary problem she said. Azurix has been looking at cost and strategies ever since it got a new president and chief executive on Aug. 25 said Bazelides. That was the date that Rebecca Mark resigned as Azurix's high-profile chairman and chief executive. Enron and Azurix have been looking at strategic alternatives for nine months J. Mark Meets Enron's executive vice president for corporate development said in a letter filed with the Securities and Exchange Commission. One alternative was selling the company he said. That didn't work out because the offers from three companies didn't exceed $4 per share. The fourth potential buyer said it would consider offering $7 per share said Meets. But that suitor backed out citing reasons like cash flow complexity of the capital structure tax considerations and pending securities litigation. We are obviously quite disappointed by this most recent turn of events Meets said in the letter. However we strongly believe that there is no other buyer willing to pay the $7 per share initially proposed (but later withdrawn) by the fourth bidder. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Quietly Bush's team talks about transition Plenty of folks in Austin would love to follow Bush to D.C. Ken Herman American-Statesman Capitol Bureau Chief 10/28/2000 Austin American-Statesman A1 (Copyright 2000) Not long ago at a glossy wooden table in a Texas Capitol office two of Gov. George W. Bush's high-level appointees discussed one of the key issues in state government these days. It involved the relative merits of White House posts that could be available to the two appointees if Bush becomes president. Asked this week whether it's a common topic around the Capitol one of the appointees gestured to the anteroom of his office and made a motion indicating that even the midlevel folks have Washington on their minds. Near the banks of the Colorado Potomac Fever is a near-epidemic. And though it is political faux pas to be too open about doing White House transition planning before Election Day be assured it is going on at Bush headquarters where top officials are cognizant of the fine line between looking too confident now and looking too unprepared later. The candidate himself -- as well as his top aides -- steers clear of transition talk. When asked who might wind up in his Cabinet Bush looks backward instead of forward saying that his selection of Dick Cheney as his running mate should offer a glimpse of the kind of people who would wind up in his administration. The transition work such that it is is under the aegis of longtime Bush friend and aide Clay Johnson who began as head of the gubernatorial appointments office and now serves as chief of staff. Johnson said nobody has been interviewed for any Washington post but he has compiled a file of folks who are interested in serving in a Bush administration. Johnson also has been reading up on previous transitions -- ones that went well and ones that didn't. His preliminary conclusion is that the outgoing administrations are generally helpful and supportive even if they were ousted by the incoming administration. It's the incoming administrations that can make the mistakes he said. There is no shortage of think tanks that have think-tanked the topic. Back in August the Heritage Foundation based in Washington issued a transition handbook titled The Keys to a Successful Presidency. Though we really don't expect either campaign to talk about it (and would discourage them from doing so) the message here is it's time to start planning for a possible presidential transition quietly well behind the scenes but with the understanding that the preparation done during the next 70 or so days and the work done in the 70 or so days that follow (between the election and the inauguration) will very well determine the initial success or failure of the next administration Herbert Berkowitz a foundation vice president said in releasing the study. All indications are that the Bush team has been following the advice with Johnson at the helm. Johnson cautions against expectations that a Bush administration would be overloaded with Texans. It's the United States of America not the United States of Texas he said. Despite that caveat there is no shortage of Texans who are considered shoo-ins to fill some of the thousands of slots Bush could offer if he wins. Johnson confirms that he is very interested in a Washington job. Early speculation among Bush aides makes Johnson a potential leading contender for head of personnel at the White House. Karen Hughes Bush's communications director since his 1994 gubernatorial campaign is expected to become Bush's press secretary if he wins the White House. Karl Rove Bush's longtime political guru also will be on board though he could wind up with an out-of- the-White-House post perhaps at the Republican National Committee. Not as certain is the potential future for Joe Allbaugh who is part of the iron triangle of top advisers -- along with Rove and Hughes -- who have been on board with Bush since the 1994 campaign. Allbaugh serves as manager of the presidential campaign and previously served as chief of staff in the governor's office. Capitol speculation indicates Allbaugh could decide to skip a White House post possibly in favor of a lobbying job if he is not tapped as chief of staff. That post could go to Don Evans a longtime Bush friend who headed the megasuccessful fund-raising effort for the presidential campaign. However not everyone has Potomac Fever. For example Terral Smith Bush's legislative director said he will stay in Austin to lobby. In addition to the speculation about appointees the approaching election has sparked talk about when Bush might leave office if he wins. Under the U.S. Constitution he could remain governor until he has to become president on Jan. 20. Much more likely however is that Bush would leave office sooner than that perhaps as soon as two or three weeks after the Nov. 7 election if he wins. That could cause a housing problem for Bush whose main residence is the Governor's Mansion which comes as a free perk of the job. The Bushes have a home under construction at their ranch in Crawford near Waco. The ranch also has a smaller house in which the Bushes now spend weekends. Not out of the question is that Bush could work out an arrangement with Lt. Gov. Rick Perry who would become governor if Bush resigns to remain in the Governor's Mansion for several weeks after he leaves office. If the race among Texas senators to replace Perry as lieutenant governor complicates the timing of the resignation Bush could stay in the governor's office a little longer but no later than the first week of January. After all he will want to give Perry time to bask in his gubernatorial inauguration before the Legislature convenes Jan. 9. No matter when Bush resigns confidantes believe he might use his Crawford ranch for interviews with potential top-level appointees including Cabinet members. You may contact Ken Herman at kherman@statesman.com or 445-1718. Washington buzz A look at Bush allies expected to get appointments in a Bush administration: * Texas Secretary of State Elton Bomer * State Rep. Tom Craddick R-Midland * Public Safety Commission Chairman Jim Francis of Dallas * Texas Railroad Commissioner Tony Garza* Texas Supreme Court Justice Al Gonzales * Former Dallas ISD board President Sandy Kress * Kenneth Lay of Houston chief executive officer of Enron * Ralph Marquez of Texas City member of the Texas Natural Resource Conservation Commission * Vance McMahan of Austin a policy adviser in the governor's office * Harriet Miers of Dallas Bush's personal lawyer and former appointee to the Texas Lottery Commission * Pat Oxford Houston lawyer and member of the University of Texas System Board of Regents * Pat Wood of Austin chairman of the Texas Public Utility Commission * Margaret La Montagne the governor's education adviser Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Dynegy: Calif Price Caps Will Compromise Elec Reliability 10/27/2000 Dow Jones Energy Service (Copyright (c) 2000 Dow Jones & Company Inc.) LOS ANGELES -(Dow Jones)- A Dynegy executive said Friday that the California Independent System Operator's plan to impose hourly price caps on the wholesale power market will compromise reliability by forcing generators to sell electricity out of state. If the ISO says it will not buy above a certain price and generators cannot operate below that price then we have no choice but to find other markets to participate in said Dynegy senior vice president of marketing and trading asset management Lynn Lednicky. That may lead to the ISO not finding the power it needs at a price it wants to pay. The ISO plans to construct hourly price caps each month based on forecast load natural gas prices and generation unit efficiency. The caps will take effect Nov. 3 or soon therafter. Dynegy Inc. (DYN) sent a letter to the Federal Energy Regulatory Commission asking it to address reliability consequences of the price caps before Nov. 3. Dynegy specifically requested that FERC discuss the issue at its Nov. 1 meeting when it will release a report on California's electricity problems. Enron Corp. (ENE) and Southern Company (SO) share Dynegy's concerns about reliability and plan to petition FERC about the issue said a trader listening in to a conference call between the three companies. -By Jessica Berthold Dow Jones Newswires 323-658-3872 jessica.berthold@dowjones.com Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. SEC Filing Shows 3rd Parties Contacted Enron About Azurix By Christopher C. Williams 10/27/2000 Dow Jones News Service (Copyright (c) 2000 Dow Jones & Company Inc.) Of DOW JONES NEWSWIRES New York -(Dow Jones)- Shares of Azurix Corp. (AZX) jumped 84% in heavy trading Friday after parent Enron Corp. (ENE) proposed to take the company private in a $7-a-share buyout. Filings with the Securities and Exchange Commission showed that Enron made the proposal after not being satisfied with offers it had received from four third parties for its stake in Azurix. In a letter to two members of Azurix's board Enron said three potential buyers were unlikely to be willing to pay more than the then-current market price of approximately $4 a share. Enron said a fourth potential buyer indicated it would consider a $7-a-share offer but it said that proposal was recently withdrawn. The reasons given by the bidder included pro forma cash flows the complexity of the capital structure tax considerations and the currently pending securities litigation the letter said. Mark Palmer a spokesman for Houston-based Enron declined to say whether Enron was entertaining current third-party interests or was in any talks with other parties regarding its Azurix stake. In New York Stock Exchange composite trading Azurix ended Friday up $3 to $6.56 on 2.8 million shares compared with average daily volume of 239000 shares. Enron was up $1.38 or 1.8% to $78.88 on 1.6 million shares compared with its daily average turnover of 2.4 million. In the SEC filing Enron saying it's familiar with Azurix's various partial and full liquidation alternatives said its buyout proposal is conditioned upon Azurix not selling any significant assets prior to the buyout. Although we agree that such plans may result in greater value to Azurix's shareholders than the maintenance of the status quo we believe that these options almost certainly will not result on a present value in a greater return to Azurix's shareholders than $7 a share the letter said. Enron also said its buyout proposal doesn't include any breakup fees or other deal protection devices. This frees Azurix's board to pursue an acquisition that might provide greater value to shareholders. Daine Bazelides a spokeswoman for Azurix declined to say whether Azurix is now entertaining offers for the company. She did however confirm the information contained in Enron's filing. The historical information in the filing is factually correct she told Dow Jones Newswires. She said she doesn't know when Azurix board will respond to Enron's proposal. In the filing Enron didn't set a deadline but warned that Azurix's position with customers and employees may deteriorate further. We must therefore reserve the right to withdraw our proposal at any time Enron's letter said. In the letter Enron pointed out that Azurix had retained two internationally recognized investment bankers early this year to evaluate strategic alternatives which included the potential sale of the company to unrelated third parties. Enron said it strongly believes there isn't another buyer willing to pay $7 a share for Enron's indirect interest in Azurix. We believe it is in Azurix's best interest as well as the best interest of its shareholders and employees if Azurix were no longer a publicly traded company Enron said. -By Christopher C. Williams Dow Jones Newswires 201-938-5219 Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Enron offers to buy out Azurix Financial Times By Hillary Durgin in Houston Published: October 27 2000 23:31GMT | Last Updated: October 27 2000 23:36GMT Enron the Houston-based energy and trading group said on Friday it had offered up to $275m in funding to take Azurix private at a buy-out price of $7 per share. The specific structure of Enron's proposal has yet to be determined Enron said. Azurix said its board would now consider the proposal. The timing of any decision was unclear. Enron owns directly and indirectly about 66 per cent of Azurix the troubled Houston water company whose main asset is UK-based Wessex Water. The buyout offer is the latest development in a history of problems at Azurix which was spun off from Enron and taken public at an offering price of $19 per share. But a combination of poor market timing competitive industry conditions and empty promises by the company on Wall Street took their toll on the company whose shares have since plummeted and have been trading most recently around the $3-per-share range. In August Rebecca Mark Azurix chief executive officer resigned both from Azurix and from the board at Enron. Enron's offer came after four unnamed parties approached Enron about buying its stake in Azurix. While three of the four were unwilling to pay more than the then market price of about $4 per share a fourth party who was considering offering $7 per share (before accounting for any dilution for stock options) later declined to pursue the transaction Enron said in Friday's letter to Azurix outlining the buyout proposal. We strongly believe that our proposal is fair to Azurix's public stockholders the letter stated. Our proposed transaction would permit Azurix's stockholders to receive on a timely basis a cash payment for their shares that is significantly above the price at which those shares have traded in several months. Analysts that follow Azurix and had valued the shares at between $6 and $8 per shares said the offer was fair. Analysts that follow Enron said that Azurix's business strategy had proved to be a failure and was characteristic of the hard asset approach that Enron has gradually distanced itself from. Enron's shares closed at $78.88 up $1.38 on Friday. Azurix's shares rose $3 to close at $6.56. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: REVISION - New HR Rep for Public Affairs and Administration Body:: Please do send it out. Thanks for the kind words. I know you know how I feel about your work and I have shared that view widely. I have enjoyed working with you I always valued your insights your responsiveness and your work ehtic. I wish you all the best in your new role. Gwendolyn Petteway@ENRON 07/24/2000 02:47 PM To: Steven J Kean/HOU/EES@EES cc: Subject: REVISION - New HR Rep for Public Affairs and Administration Arquella's last day is Wed. 7/26. ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Request for PR2 Access Body:: OK From: Jo Ann Hill/ENRON@enronXgate on 07/18/2001 04:31 PM To: Steven J Kean/NA/Enron@Enron cc: Kathryn Schultea/ENRON@enronXgate Mary Joyce/ENRON@enronXgate Subject: FW: Request for PR2 Access Steve -- For your approval. As some additional information regarding the request Kathy Diane Taylor and I met with Deana Taylor this afternoon to understand what each person's role was and the specific access needed. For the interim we are recommending that the HR View Basic Data & Org ENTP and View Payroll and Time ENTP role be granted to each of the individuals listed below. Until January 1 this function was performed in the Payroll Department and at that time was transitioned to Karen and Deana's group. The people listed below actually transferred from the Payroll Department. For the long term we are going to look at creating a specific role for this group that would let them access only those data elements needed. I've spoken with Mary Joyce by phone and she has approved so I am requesting your approval as well. These people have basically been prevented from being able to reconcile any of the net pay accounts etc. for the past week. Please let me know if you will approve or if you need any additional information. Thanks. Jo Ann What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: IEP in the News, and other headlines Body:: San Jose Mercury News April 19 2001 Thursday SJ-POWER 593 words ????Testimony Indicates California Electricity Market Was Troubled in 1998 By ????Brandon Bailey (Quotes Smutny on behalf of IEP) The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? 9:55 AM Eastern Time State and Regional 930 words Developments in ????California's energy crisis By The Associated Press (Quotes Smutny on behalf of IEP) The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? 9:32 AM Eastern Time State and Regional 820 words Legislators probe ????possible power natural gas collusion By DON THOMPSON Associated Press ????Writer SACRAMENTO (Quotes Smutny on behalf of IEP) The Associated Press State & Local Wire April 18 2001 Wednesday BC ????cycle State and Regional 833 words Legislators probe possible power ????natural gas collusion By DON THOMPSON Associated Press Writer SACRAMENTO ???(Quotes Smutny on behalf of IEP) The Associated Press State & Local Wire April 18 2001 Wednesday BC ????cycle State and Regional 841 words Developments in California's energy ????crisis By The Associated Press (Quotes Smutny on behalf of IEP) Power bloc blasts seizure idea Producers say talk of bold action fuels crisis ???????By Steve Geissinger SACRAMENTO BUREAU ?-- Oakland Tribune (Quotes Smutny on behalf of IEP) Copley News Service April 19 2001 Thursday State and regional 780 ????words Windfall-profits tax gets Davis' backing Bill Ainsworth SACRAMENTO Los Angeles Times April 19 2001 Thursday Home Edition Page 3 772 ????words CAPITOL JOURNAL ?CALIFORNIA AND THE WEST ??Price Caps Don't Fit in ????Cheney's Head for Figures GEORGE SKELTON SACRAMENTO Los Angeles Times April 19 2001 Thursday Home Edition Page 3 1373 ????words CALIFORNIA AND THE WEST ??DAVIS BACKS SILICON VALLEY POWER PROJECT ????ENERGY: GOVERNOR URGES QUICK APPROVAL OF SAN JOSE PLANT DESPITE OPPOSITION ????BY CITY AND A POWERFUL FIRM. JENIFER WARREN and TERENCE MONMANEY TIMES ????STAFF WRITERS SACRAMENTO The Orange County Register April 19 2001 Thursday STATE AND REGIONAL ????NEWS K7970 275 words Ex-energy chief leery of state buying power lines ????By Kate Berry The San Francisco Chronicle APRIL 19 2001 THURSDAY FINAL EDITION ????NEWS Pg. A18 585 words Alameda public utility rents four backup ????generators ???Extra electricity will be used during summer rolling ????blackouts Matthew Yi Alameda The San Francisco Chronicle APRIL 19 2001 THURSDAY FINAL EDITION ????NEWS Pg. A3 845 words Davis' gouging claims disputed ???Officials say ????no link between PG&E bankruptcy high prices David Lazarus The San Francisco Chronicle APRIL 19 2001 THURSDAY FINAL EDITION ????NEWS Pg. A3 888 words Davis backs San Jose power plant ???He also ????acknowledges bailout for Edison will be uphill fight Lynda Gledhill ????Sacramento The Vancouver Sun April 19 2001 Thursday 731 words B.C. Hydro's credit ????to California firms exceeded 1999 guidelines David Baines The Associated Press State & Local Wire April 18 2001 Wednesday BC ????cycle Business News 348 words Williams again target of overcharging ????allegations from federal regulators TULSA Okla. The Associated Press State & Local Wire April 18 2001 Wednesday BC ????cycle State and Regional 332 words Governor congressman to fight ????proposals for national power deregulation policy By MARGERY BECK ????Associated Press Writer LINCOLN Neb. San Jose Mercury News April 18 2001 Wednesday SJ-POWER-PLANT 1038 ????words California Governor May Back Energy Firm's Proposed Power Plant Scripps Howard News Service April 18 2001 Wednesday DOMESTIC NEWS 588 ????words Davis says Edison agreement may need altering EMILY BAZAR and KEVIN ????YAMAMURA SACRAMENTO Calif. San Jose Mercury News April 19 2001 Thursday KR-ACC-NO: SJ-POWER LENGTH: 593 words HEADLINE: Testimony Indicates California Electricity Market Was Troubled in 1998 BYLINE: By Brandon Bailey BODY: ??SACRAMENTO Calif.--California's electricity market was showing signs of trouble as far back as 1998 the year that it was officially opened to competition members of a special legislative investigating committee were told Wednesday. ??Abnormal price spikes -- far higher than what should have occurred in a competitive market -- were showing up in August 1998 the committee was told by Frank Wolak a Stanford economist and top advisor to the California Independent System Operator which runs the state's transmission grid. ??Appearing on the first day of hearings called by a state Senate select committee to investigate alleged wholesale energy price manipulation Wolak testified that the ISO's economic advisors repeatedly found signs that power suppliers were able to influence prices over the last three years -- even before wholesale prices soared skyhigh last summer. ??By controlling even a relatively small portion of power supply just enough to make a difference in whether the state could meet consumers' needs Wolak said generators have been able to charge prices far higher than their costs. ??All told the ISO has estimated power suppliers collected more than $ 6 billion in unjustified profits last year. ??In his opinion Wolak added that violates the terms by which federal regulators allowed the suppliers to enter the state's newly deregulated market when it opened in 1998. ??The ISO is now filing petitions with the Federal Energy Regulatory Commission asking that agency to revoke the generators' right to charge unregulated prices. ??But Wolak repeatedly told the committee that he had no evidence that the suppliers acted in collusion or that they had violated any federal anti-trust laws. ??When state Senator Joe Dunn D-Garden Grove pressed him on the point Wolak insisted I can't say yes I can't say no. There's a lot of things that certainly look puzzling. It's hard without further information and analysis to say definitively but there's lots of things to seem to be worth looking into. ??Dunn a former consumer attorney is leading the Legislature's efforts to answer a question that a host of other state and federal officials have also posed: have California's electricity prices been the result of any illegal or unethical acts? ??Power suppliers and their representatives have repeatedly said the answer is no. They say their prices are the result of short supplies and natural market swings. ??Eleven investigations into California's electricity market have been conducted or are currently under way said a statement issued Wednesday by Jan Smutny-Jones executive director of the Independent Energy Producers Association. Not one has found or proven any wrongdoing by generators. ??Dunn however said Wednesday's testimony was only the start of what he promised would be a vigorous investigation. He said the committee has already asked several power companies for records and other information and he hinted that subpoenas may be issued in the coming weeks. ??We will try to figure out how to stop these high prices if they are unjustified Dunn said at the beginning of the hearing. ??We're not going to be looking for ways to finance these payments he added. The state is now paying $ 70 million a day to buy power for California consumers after major utilities wracked up billions in debts while buying power on the open market in recent months. ??----- ??To see more of the San Jose Mercury News or to subscribe to the newspaper go to http://www.sjmercury.com JOURNAL-CODE: SJ LOAD-DATE: April 19 2001 of 5 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 930 words HEADLINE: Developments in California's energy crisis BYLINE: By The Associated Press BODY: ??Developments in California's energy crisis: ??THURSDAY: ??- The state remains free of power alerts as reserves stay above 7 percent. ??- Gov. Gray Davis meets with 25 members of the California congressional delegation at the Los Angeles International Airport to discuss the state's power crisis. ??- An Assembly committee continues hearings on the natural gas supply and possible price manipulation. ??-The Public Utilities Commission meets in San Francisco to decide whether to investigate if a key bloc of independent generators are purposely keeping their plants offline. ??WEDNESDAY: ??- Unchecked free-market forces drove up the price of natural gas to Southern California Edison by about $750 million over the last year an industry consultant tells the Assembly Electricity Oversight Subcommittee. ??Meanwhile the Senate's Select Committee to Investigate Price Manipulation of the Wholesale Energy Market begins investigating whether electric generators artificially inflated power prices. ??An industry spokesman predicts the investigations will uncover nothing illegal. ??- The state offers financial backing to Houston-based Dynegy which worried it would not be paid for power generated at its plants in California. Dynegy agrees to sell 300 megawatts of power from 17 small turbine generators in Carlsbad after receiving an offer from the California Department of Water Resources. ??- Gov. Gray Davis urges state regulators to approve the construction of a controversial 600-megawatt power plant in south San Jose to provide electricity to roughly 450000 homes in the Silicon Valley. ??- The Democratic governor lobbies Senate Democrats to support his plan to pay $2.7 billion for the transmission lines owned by Southern California Edison. ??State spending on electricity has jumped by more than 50 percent since Pacific Gas and Electric Corp. declared bankruptcy April 6 thanks in part of surcharges tacked on by power generators worried they won't be repaid Davis said. ??- The Senate Appropriations Committee sends the full Senate a bill creating a public power authority that would loan out up to $5 billion to build or buy power plants that would be required to sell electricity to consumers at low rates. ??- An Assembly committee advances a bill ending the exemption under which utility lobbyists do not have to follow the same reporting requirements as do other lobbyists. The bill now goes to the Assembly Appropriations Committee. ??- A Pacific Gas and Electric Corp. shareholder sues the company claiming it misled shareholders by forecasting annual profits for two quarters last year when the suit says the company knew it was incurring losses. ??-Public Utilities Commission President Loretta Lynch issues a statement late Wednesday saying inaction by the Federal Energy Regulatory Commission forced Southern Caifornia Edison Co. to take a large write-off of debt. The company should not have to shoulder these liabilities and neither should its customers Lynch says. ??- Edison International's stock closes at $11.40 down 48 cents while stock in PG&E's parent closes up 14 cents at $9.04. ??- The state remains free of power alerts as reserves stay above 7 percent. ??WHAT'S NEXT: ??- The Assembly's Energy Oversight Subcommittee plans to resume hearings Thursday in its inquiry into California's highest-in-the-nation natural gas prices with testimony from gas companies. ??- Davis' representatives continue negotiating with Sempra the parent company of San Diego Gas and Electric Co. to buy the utility's transmission lines. Davis says he expects to have an agreement within two weeks. ??- The state Public Utilities Commission will decide Thursday whether to investigate why a key block of power generators is staying off-line despite regulators' order last month that they start getting paid by the state's utilities. Independent Energy Producers Executive Director Jan Smutny-Jones says the generators can't afford to operate because they are still owed more than a billion dollars and because the PUC's rates don't cover their operating costs. ??PUC President Loretta Lynch also wants the commission to decide Thursday to investigate whether PG&E's April 6 bankruptcy protection filing is enough of a threat to the PUC's regulatory authority to prompt more PUC involvement in the bankruptcy proceedings. ??THE PROBLEM: ??High demand high wholesale energy costs transmission glitches and a tight supply worsened by scarce hydroelectric power in the Northwest and maintenance at aging California power plants are all factors in California's electricity crisis. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Electricity and natural gas suppliers scared off by the two companies' poor credit ratings are refusing to sell to them leading the state in January to start buying power for the utilities' nearly 9 million residential and business customers. The state is also buying power for a third investor-owned utility San Diego Gas & Electric which is in better financial shape than much larger Edison and PG&E but also struggling with high wholesale power costs. ??The Public Utilities Commission has raised rates up to 46 percent to help finance the state's multibillion-dollar power-buying. LOAD-DATE: April 19 2001 of 5 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 820 words HEADLINE: Legislators probe possible power natural gas collusion BYLINE: By DON THOMPSON Associated Press Writer DATELINE: SACRAMENTO BODY: ??Southern California Edison was charged about $750 million more this year for natural gas because of unchecked free-market forces an industry consultant testified. ??Paul Carpenter told the Assembly Electricity Oversight Subcommittee on Wednesday the price spikes came after the El Paso Natural Gas Co. contracted first with Dynegy and later with its own marketing affiliate El Paso Merchant Energy to control the pipeline capacity. ??Officials with El Paso and other natural gas suppliers are expected to testify Thursday that they did not illegally manipulate the market. ??The California Public Utilities Commission estimated a year ago that overcharges by the companies that control natural gas flow drove up prices by $ 100 million a year to California gas and electricity customers. ??But PUC attorney Harvey Morris said that was before last summer's price spikes which he blamed on natural gas suppliers using a monopoly to game the system. ??It's way worse than we could possibly have imagined Morris said after testifying before the subcommittee. It's obviously way higher than $100 million. ??Natural gas rates at the California border generally tracked national prices until November when they spiked as high as 11 times higher than the price of natural gas elsewhere in the nation Carpenter said. ??I have never seen gas prices like this anywhere in the world said Carpenter who has been studying the energy market for 20 years for Cambridge Mass.-based consultant The Brattle Group. The Brattle Group was hired by Edison to study the natural gas market. ??The committee is one of two legislative committees exploring whether illegal market manipulation in the electricity and natural gas markets has driven up California's energy costs. ??This is a market that is plagued by the exercise of market power Frank Wolak chairman of the California Independent System Operator's Market Surveillance Committee told the Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market. The ISO runs the state's power grid. ??However there is no law against me saying 'I'm not going to sell to you' Wolak said. Market manipulation only becomes illegal when there is collusion Wolak said and such evidence is hard to find. ??Electricity generators and natural gas suppliers say a severe supply and demand imbalance - not market manipulation - has led to higher prices. ??Everybody's busy doing investigations. They're not interested in solving the problem said Independent Energy Producers Executive Director Jan Smutny-Jones. ??Investigations are wasting everybody's time Smutny-Jones said adding that previous probes and lawsuits have uncovered no wrongdoing. He said the state's power problems came because state regulators denied utilities the chance to sign long-term energy contracts when they had the chance. ??People have been playing by the rules Smutny-Jones said. ??But the Senate committee's first witnesses are ISO officials who authored studies that claim the state paid more than $6 billion too much for power last year. ??Committee chair Joseph Dunn D-Garden Grove also has slated state Auditor Elaine Howell who last month blamed buyers and sellers for skyrocketing electricity costs. Dunn also has scheduled future testimony from state federal academic and private investigators studying the power market. ??He invited five major generators to attend the committee's second hearing next week. All five - Reliant Dynegy Williams Energy Duke Energy and Mirant - say they are eager to cooperate and clear their names Dunn said. ??Dunn asked the five for a total of 86 specific documents. If the companies feel they cannot provide documents because of legal or confidentiality concerns Dunn said he will subpoena them. ??Smutny-Jones said investigators appear to be growing desperate to blame the state's natural gas and electricity price hikes on illegal market manipulation instead of natural market forces. ??He cited Attorney General Bill Lockyer's announcement last week that any informant who helped prove wrongdoing would be entitled to a percentage of the state's recovery he estimated could range from $50 million to hundreds of millions of dollars. ??If the state's offering a $50 million reward they haven't found anything Smutny-Jones said. I don't think you're going to find the fact that anybody did anything criminal here. ??Assemblywoman Jenny Oropeza D-Long Beach said she believes otherwise after Wednesday's testimony: I think it is very clear there was some price manipulation going on. ??But Assemblyman John Campbell R-Irvine isn't sure there was anything illegal. ??There clearly are market forces at work that's evident Campbell said. Whether you make the jump to market manipulation ... I haven't seen conclusive evidence that leads me to make that jump. LOAD-DATE: April 19 2001 of 5 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ?????????????????????April 18 2001 Wednesday BC cycle SECTION: State and Regional LENGTH: 833 words HEADLINE: Legislators probe possible power natural gas collusion BYLINE: By DON THOMPSON Associated Press Writer DATELINE: SACRAMENTO BODY: ??Unchecked free-market forces drove up the price of natural gas to Southern California Edison by about $750 million over the last year an industry consultant testified Wednesday. ??Paul Carpenter told the Assembly Electricity Oversight Subcommittee the price spikes came after the El Paso Natural Gas Co. contracted first with Dynegy and later with its own marketing affiliate El Paso Merchant Energy to control the pipeline capacity. ??The California Public Utilities Commission estimated a year ago that overcharges by the companies that control natural gas flow drove up prices by $ 100 million a year to California gas and electricity customers. ??But PUC attorney Harvey Morris said that was before last summer's price spikes which he blamed on natural gas suppliers using a monopoly to game the system. ??It's way worse than we could possibly have imagined Morris said after testifying before the subcommittee. It's obviously way higher than $100 million. ??Natural gas rates at the California border generally tracked national prices until November when they spiked as high as 11 times higher than the price of natural gas elsewhere in the nation Carpenter said. ??I have never seen gas prices like this anywhere in the world said Carpenter who has been studying the energy market for 20 years for Cambridge Mass.-based consultant The Brattle Group. The Brattle Group was hired by Edison to study the natural gas market. ??Officials with El Paso and other natural gas suppliers have denied illegally manipulating the market. They are scheduled to testify Thursday. El Paso officials did not return telephone calls for comment Wednesday. ??The committee is one of two legislative committees exploring whether illegal market manipulation in the electricity and natural gas markets has driven up California's energy costs. ??This is a market that is plagued by the exercise of market power Frank Wolak chairman of the California Independent System Operator's Market Surveillance Committee told the Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market. The ISO runs the state's power grid. ??However there is no law against me saying 'I'm not going to sell to you' Wolak said. Market manipulation only becomes illegal when there is collusion Wolak said and such evidence is hard to find. ??Electricity generators and natural gas suppliers say a severe supply and demand imbalance - not market manipulation - has led to higher prices. ??Everybody's busy doing investigations. They're not interested in solving the problem said Independent Energy Producers Executive Director Jan Smutny-Jones. ??Investigations are wasting everybody's time Smutny-Jones said adding that previous probes and lawsuits have uncovered no wrongdoing. He said the state's power problems came because state regulators denied utilities the chance to sign long-term energy contracts when they had the chance. ??People have been playing by the rules Smutny-Jones said. ??But the Senate committee's first witnesses are ISO officials who authored studies that claim the state paid more than $6 billion too much for power last year. ??Committee chair Joseph Dunn D-Garden Grove also has slated state Auditor Elaine Howell who last month blamed buyers and sellers for skyrocketing electricity costs. Dunn also has scheduled future testimony from state federal academic and private investigators studying the power market. ??He invited five major generators to attend the committee's second hearing next week. All five - Reliant Dynegy Williams Energy Duke Energy and Mirant - say they are eager to cooperate and clear their names Dunn said. ??Dunn asked the five for a total of 86 specific documents. If the companies feel they cannot provide documents because of legal or confidentiality concerns Dunn said he will subpoena them. ??Smutny-Jones said investigators appear to be growing desperate to blame the state's natural gas and electricity price hikes on illegal market manipulation instead of natural market forces. ??He cited Attorney General Bill Lockyer's announcement last week that any informant who helped prove wrongdoing would be entitled to a percentage of the state's recovery he estimated could range from $50 million to hundreds of millions of dollars. ??If the state's offering a $50 million reward they haven't found anything Smutny-Jones said. I don't think you're going to find the fact that anybody did anything criminal here. ??Assemblywoman Jenny Oropeza D-Long Beach said she believes otherwise after Wednesday's testimony: I think it is very clear there was some price manipulation going on. ??But Assemblyman John Campbell R-Irvine isn't sure there was anything illegal. ??There clearly are market forces at work that's evident Campbell said. Whether you make the jump to market manipulation ... I haven't seen conclusive evidence that leads me to make that jump. LOAD-DATE: April 19 2001 of 5 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ?????????????????????April 18 2001 Wednesday BC cycle SECTION: State and Regional LENGTH: 841 words HEADLINE: Developments in California's energy crisis BYLINE: By The Associated Press BODY: ??Developments in California's energy crisis: ??WEDNESDAY: ??- Unchecked free-market forces drove up the price of natural gas to Southern California Edison by about $750 million over the last year an industry consultant tells the Assembly Electricity Oversight Subcommittee. ??Meanwhile the Senate's Select Committee to Investigate Price Manipulation of the Wholesale Energy Market begins investigating whether electric generators artificially inflated power prices. ??An industry spokesman predicts the investigations will uncover nothing illegal. ??- The state offers financial backing to Houston-based Dynegy which worried it would not be paid for power generated at its plants in California. Dynegy agrees to sell 300 megawatts of power from 17 small turbine generators in Carlsbad after receiving an offer from the California Department of Water Resources. ??- Gov. Gray Davis urges state regulators to approve the construction of a controversial 600-megawatt power plant in south San Jose to provide electricity to roughly 450000 homes in the Silicon Valley. ??- The Democratic governor lobbies Senate Democrats to support his plan to pay $2.7 billion for the transmission lines owned by Southern California Edison. ??State spending on electricity has jumped by more than 50 percent since Pacific Gas and Electric Corp. declared bankruptcy April 6 thanks in part of surcharges tacked on by power generators worried they won't be repaid Davis said. ??- The Senate Appropriations Committee sends the full Senate a bill creating a public power authority that would loan out up to $5 billion to build or buy power plants that would be required to sell electricity to consumers at low rates. ??- An Assembly committee advances a bill ending the exemption under which utility lobbyists do not have to follow the same reporting requirements as do other lobbyists. The bill now goes to the Assembly Appropriations Committee. ??- A Pacific Gas and Electric Corp. shareholder sues the company claiming it misled shareholders by forecasting annual profits for two quarters last year when the suit says the company knew it was incurring losses. ??-Public Utilities Commission President Loretta Lynch issues a statement late Wednesday saying inaction by the Federal Energy Regulatory Commission forced Southern Caifornia Edison Co. to take a large write-off of debt. The company should not have to shoulder these liabilities and neither should its customers Lynch says. ??- Edison International's stock closes at $11.40 down 48 cents while stock in PG&E's parent closes up 14 cents at $9.04. ??- The state remains free of power alerts as reserves stay above 7 percent. ??WHAT'S NEXT: ??- The Assembly's Energy Oversight Subcommittee plans to resume hearings Thursday in its inquiry into California's highest-in-the-nation natural gas prices with testimony from gas companies. ??- Davis' representatives continue negotiating with Sempra the parent company of San Diego Gas and Electric Co. to buy the utility's transmission lines. Davis says he expects to have an agreement within two weeks. ??- The state Public Utilities Commission will decide Thursday whether to investigate why a key block of power generators is staying off-line despite regulators' order last month that they start getting paid by the state's utilities. Independent Energy Producers Executive Director Jan Smutny-Jones says the generators can't afford to operate because they are still owed more than a billion dollars and because the PUC's rates don't cover their operating costs. ??PUC President Loretta Lynch also wants the commission to decide Thursday to investigate whether PG&E's April 6 bankruptcy protection filing is enough of a threat to the PUC's regulatory authority to prompt more PUC involvement in the bankruptcy proceedings. ??THE PROBLEM: ??High demand high wholesale energy costs transmission glitches and a tight supply worsened by scarce hydroelectric power in the Northwest and maintenance at aging California power plants are all factors in California's electricity crisis. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Electricity and natural gas suppliers scared off by the two companies' poor credit ratings are refusing to sell to them leading the state in January to start buying power for the utilities' nearly 9 million residential and business customers. The state is also buying power for a third investor-owned utility San Diego Gas & Electric which is in better financial shape than much larger Edison and PG&E but also struggling with high wholesale power costs. ??The Public Utilities Commission has raised rates up to 46 percent to help finance the state's multibillion-dollar power-buying. LOAD-DATE: April 19 2001 Power bloc blasts seizure idea Producers say talk of bold action fuels crisis By Steve Geissinger SACRAMENTO BUREAU ?-- Oakland Tribune SACRAMENTO -- Outraged by a report in The Oakland Tribune that some lawmakers asked the governor to seize high-priced power contracts a key industry group Tuesday warned the Davis administration and Legislature that such action would worsen the energy crisis. We're publicly saying . . . this kind of rhetoric will have dire consequences on both the reliability and cost of power in California for years to come said Jan Smutny-Jones executive director of the Independent Energy Producers Association. It is the kind of rhetoric one would expect in Indonesia or the Philippines not the sixth largest economy on the planet he said in a teleconference. At the same time Davis administration officials confirmed that seizing contracts of allegedly profiteering brokers is the most likely last-ditch move if options continue to narrow ahead of the previously discussed concepts of seizing California power plants owned by out-of-state firms or passing a windfall profits tax. Davis spokesman Steve Maviglio pointed out the governor already seized power contracts on which California's investor-owned utilities were defaulting in early February. The state trying to buy its way out of the energy crisis with no clear end in sight lost a substantial measure of control over electricity prices and supplies to the courts with the recent bankruptcy filing by the Pacific Gas and Electric Co. Gov. Gray Davis a Democrat employed hard-sell tactics Tuesday in an effort to convince reluctant Democrats that their failure to embrace his plan to financially rescue teetering Southern California Edison could plunge that utility into bankruptcy as well. While most Republicans are flatly opposed to the plan as misguided Democrats who hold a majority in the Legislature worry it's a public bailout of an investor-owned utility and would hand the state control over only Edison's south-state piece of the strategic high-voltage transmission grid in California. Soaring wholesale power costs have financially shattered utilities forcing the state into runaway multibillion-dollar spending that helps keep the lights on but threatens the state budget. The manager of the state's power grid has accused generators and marketers of overcharging Californians more than $6 billion in recent months. Assembly Speaker Robert Hertzberg D-Van Nuys said Monday that members of both legislative houses were interested in seizure of California power plants' contracts with brokers who sell to customers within or outside the state. Sen. Don Perata D-Oakland an outspoken critic of the Davis administration's handling of the crisis said some lawmakers had asked the governor to use emergency or eminent domain powers to seize the overpriced contracts and were awaiting Davis' answer this week. Supporters of the move said seizure would allow the state to control where the power is sold and decrease price markups by eliminating the middleman. But myriad questions remain unanswered including regulatory and interstate commerce issues as well as any state reimbursement of the brokers. Any move to seize power contracts would be overturned by the courts said Gary Ackerman executive director of the Western Power Trading Forum. Instead of trying to do what's legally within their reach they go to extreme measures that are on their very face unlawful and unconstitutional Ackerman said. Moreover industry officials said seizure would not only chill industry investment in California's power system and lead to higher power costs but would be ironic since California has shunned lower-cost long-term contracts industry officials said. It would create a very unstable political regulatory environment Smutny-Jones said. It would have extremely adverse consequences for California in the long term. Even so the talk has worried the industry. Smutny-Jones said his clients are very very troubled by this sudden turn in rhetoric. I assume when senior members of the Legislature make pronouncements about potentially seizing contracts it's designed to get our attention and we obviously take those things seriously he said. The Independent Energy Producers group is in the process of contacting the Davis administration and lawmakers said Smutny-Jones. You'll hear more about this. Copyright 2001 Copley News Service Copley News Service April 19 2001 Thursday SECTION: State and regional LENGTH: 780 words HEADLINE: Windfall-profits tax gets Davis' backing BYLINE: Bill Ainsworth DATELINE: SACRAMENTO BODY: ??Federal regulators' failure to stop what they described as anti-competitive practices in the natural-gas industry added $750 million to Southern California Edison's cost of electricity a consultant estimated yesterday. ??The consultant Paul Carpenter of the Brattle Group spoke to an Assembly subcommittee investigating why California pays the highest natural-gas prices in the nation. Natural gas is a critical part of the electricity crisis because most of the state's generating plants run on natural gas. ??Natural-gas prices have soared throughout the nation but the bench mark price paid at California's border has been double that paid at other bench mark locations throughout the nation for months according to figures released by the Assembly Subcommittee on Energy Oversight. ??Next week Carpenter plans to testify at hearings in Washington D.C. on behalf of Southern California Edison and the California Public Utilities Commission which are asking federal regulators to intervene. ??The giant utility and the state regulatory body contend that a sweetheart deal between El Paso Natural Gas and El Paso Merchant Energy gave the sister companies enough market power to artificially raise the price of natural gas that flows into Southern California from Texas. ??El Paso owns the major pipeline bringing natural gas from fields in New Mexico and Texas to Southern California. El Paso Merchant Energy is an unregulated sister company. ??Carpenter called the prices paid in Southern California ''simply unprecedented'' in the United States. He estimated that the sister companies manipulated the market enough to add $2.60 to the price of a million British thermal units of gas. ??In addition he said El Paso Merchant Energy owns part of 20 smaller power plants ''qualifying facilities'' that get paid based on the price of natural gas in California. The higher natural-gas prices increase the company's revenues Carpenter said. ??El Paso company officials are expected to testify in front of the Assembly subcommittee today but in proceedings before the federal regulators they have denied any sweetheart deal. ??In a report they commissioned the company blamed the higher natural-gas prices in Southern California on increased demand and constraints on pipeline capacity. ??Gov. Gray Davis meanwhile gave his strongest endorsement yet to a windfall-profits tax on generators as a Senate committee chaired by Joseph Dunn D-Laguna Niguel began a series of hearings to probe possible price gouging by generators. ??''I believe the Legislature would be well within its prerogative to insist that generators receive an appropriate reduction whether it's 20 percent or any other number the Legislature hit upon'' Davis said. ??Senate Democrats Davis said will form a special committee to help work on his plan for the state purchase of the transmission system of Southern California Edison for $2.76 billion in exchange for state aid in paying off the utilities' debt. ??The governor said he told Senate Democrats a number of whom are skeptical of the plan that Edison's parent firm has agreed to back a $3 billion upgrade of the neighborhood distribution system retained by Edison and to return a $400 million tax refund to the utility. ??At the natural-gas hearing yesterday state officials said that after El Paso Merchant Energy bought a significant part of the pipeline capacity from its sister company it withheld natural gas to drive prices up. ??''Marketers have gamed the system and figured out how to hoard capacity and undermine competition'' said Harvey Morris an attorney for the California Public Utilities Commission. ??State regulators want the Federal Energy Regulatory Commission which regulates natural gas to open the market to more competitors. ??But the commission has repeatedly rejected similar complaints in the past. On March 28 FERC ruled that the affiliates did not arrange a sweetheart deal. ??''The fact that El Paso Merchant controls a large volume of capacity does not in and of itself render the El Paso contracts unjust unreasonable or unduly discriminatory'' FERC ruled. ??In other cases involving natural gas federal regulators acknowledged that certain contract provisions allowed anti-competitive behavior but they approved those contracts anyway. ??Lawmakers said they were puzzled by the federal regulators' lack of action. ??''It baffles me that we've found the problem anti-competitive behavior and market gaming but there's no cure because federal regulators won't take action'' said Assemblyman Juan Vargas D-San Diego. Staff writer Ed Mendel contributed to this report. LOAD-DATE: April 19 2001 of 63 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 19 2001 Thursday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 772 words HEADLINE: CAPITOL JOURNAL CALIFORNIA AND THE WEST Price Caps Don't Fit in Cheney's Head for Figures BYLINE: GEORGE SKELTON DATELINE: SACRAMENTO BODY: ??Want price caps on wholesale electricity to staunch the bleeding of billions from California? Not going to happen Vice President Dick Cheney insists. Don't waste your energy thinking about it. ??Frankly California is looked on by many folks as a classic example of the kinds of problems that arise when you do use price caps Cheney said in a telephone interview Wednesday. ??The vice president was referring to another type of price cap--the infamous state cap on consumer rates that has left the private utilities billions short of enough revenue to pay their gouging wholesalers. What political leaders in California and the Northwest are pleading for from the Federal Energy Regulatory Commission is a regional cap on wholesale prices. ??Early last year a megawatt-hour was selling wholesale in California for $ 30. By year's end it had risen to an average $ 300 according to state officials. At peak prices have soared to $ 1500. Meanwhile demand increased last year by less than 4%. In fact demand last month was 9% less than in March 2000. ??This is the sorry news for ratepayers/ taxpayers: Californians paid $ 7.4 billion for electricity in 1999. This year the tab--without price caps--is projected at $ 70 billion. Gov. Gray Davis disclosed Tuesday that his administration has been shelling out $ 73 million a day to buy electricity for the pauper utilities. ??The profits of power producers--many of them Texans and Bush backers--have risen 400%-500%-600%. ??* ??But none of this budges the Bush administration. ??Price caps Cheney declares may provide short-term political relief for the politicians. But they don't do anything to deal with the basic fundamental problem. That problem is supply he says price caps discourage investment in new power plants and encourage consumption. ??Counters Garry South Davis' political strategist: The notion by free market zanies that you have to let profits rise 500%-600% is ludicrous. Reasonable profits can be made without bankrupting the system. They're just trying to protect the profits of their friends in the energy business. ??In truth California is building power plants as fast as it can. But not enough new megawatts apparently will be online by summer to prevent blackouts--and the bleeding of billions more into the pockets of out-of-state profiteers. ??How about a temporary price cap? ??Six months? Six years? Cheney replies. Once politicians can no longer resist the temptation to go with price caps they usually are unable to ever muster the courage to end them . . . ??I don't see that as a possibility . . . Any package you can wrap it in any fancy rhetoric you can prop it up with it does not solve the problem. ??* ??The White House clearly understands it has a problem in California--a political problem. A problem with a Democratic-dominated state that voted overwhelmingly for Al Gore. And now a problem with that mythical headline--Bush to California: Drop Dead--which seems to be getting bigger each day. ??There have been several recent California: Drop Dead stories. One was in Sunday's New York Times--Bush Devoting Scanty Attention to California. Tuesday the Sacramento Bee reported that when Cheney met with Northwest members of Congress to discuss West Coast energy he barred Californians from the room. ??Cheney flatly denies it. ??But Sen. Dianne Feinstein (D-Calif.) says she has had trouble making contact with the Bush White House. She has sent two letters to President Bush asking for a meeting on energy. The first time she got back a form letter with her name misspelled. On the second try she got a group meeting with Cheney. ??It was very disappointing she says. He spoke about letting the free market work and drilling in Alaska . That's not going to help California in the short-term. We need price caps until we're able to fix this very broken market. . . ??There seems no interest in really wanting to understand the California situation. ??I asked Cheney whether he sensed an anti-California bias across the country? No more than there's an anti-Texas bias he replied. I wouldn't get paranoid about it. ??The fact is California is one of the leading states in the nation. Often a trendsetter. . . . Well we hope not to emulate your energy policy. Hopefully we'll learn from that. ??His message to California: There's no reason not to be optimistic. The energy crunch obviously is a significant problem. . . . But it too will pass. ??While learning from California the Bush White House also might take a refresher course in the free market Hoover administration. LOAD-DATE: April 19 2001 of 63 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 19 2001 Thursday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 1373 words HEADLINE: CALIFORNIA AND THE WEST DAVIS BACKS SILICON VALLEY POWER PROJECT ENERGY: GOVERNOR URGES QUICK APPROVAL OF SAN JOSE PLANT DESPITE OPPOSITION BY CITY AND A POWERFUL FIRM. BYLINE: JENIFER WARREN and TERENCE MONMANEY TIMES STAFF WRITERS DATELINE: SACRAMENTO BODY: ??Attempting to show that no region in California is safe from sacrifice Gov. Gray Davis on Wednesday called for quick state approval of a controversial power plant proposed for the Silicon Valley. ??The governor's action locks him in combat with the San Jose City Council which has unanimously rejected the plant and Cisco Systems the computer networking giant that wants to build its worldwide headquarters on adjacent land. ??In praising the proposed plant as a model of low-polluting efficiency Davis said all regions of California must share the pain as the state expands its power supply--a key step toward ending blackouts and reducing sky-high electricity prices. ??If approved the plant would be the 14th licensed by the California Energy Commission since Davis took office. The 13th--a 510-megawatt plant near San Diego--was approved unanimously by the commission Wednesday with little controversy. ??Rushing to expand the state's overtaxed energy supply the governor has recently cut in half the approval times for the licensing of some plants. Six are under construction according to Davis and three are scheduled to begin operation this summer. A fourth--the AES Corp. generator in Huntington Beach that is due to be restarted --could add more megawatts to the supply this summer. ??V. John White an energy consultant in Sacramento said the governor's newly active role as an advocate for power plants was a necessary step given the urgency of the supply shortage. ??It's very rare and I wouldn't want him to short-circuit the commission's review process White said. But I think he's trying to reassure folks we're doing everything we can and not just sitting around in our hot tubs. ??Davis urged the Energy Commission--a five-member panel dominated by his appointees--to stop talking about the project and grant it a license. If the commission does so it will mark only the third time the panel has usurped a local government's authority over zoning. ??We are all in this together Davis said flanked by a forest of electric transformers near the Capitol. We are one state and we all have to make the sacrifices necessary to make up for the mistakes of the last 12 years when no major power plants were built. ??The governor said the plant's developers Calpine Corp. and Bechtel Enterprises Holdings Inc. have made numerous concessions to San Jose officials including an agreement to sell power exclusively in the region. ??He added that the $ 300-million plant--expected to supply about 450000 homes--will be equipped with state-of-the-art systems that make it one of the cleanest plants to go up in the nation. ??The commission's staff has recommended licensing the project and some analysts said the governor's intervention--said to be unprecedented--should fuel momentum for approval. ??Commissioner Robert Laurie--one of two members who held evidentiary hearings on the project and is preparing a recommendation for the full commission--would not comment on the plant's prospects. But Laurie an appointee of former Gov. Pete Wilson insisted that the project would receive an impartial review. ??I know the importance of independent decision-making he said. ??San Jose officials say the Calpine project conflicts with the aesthetics of its site in a bucolic valley 15 miles south of downtown. On Wednesday Mayor Ron Gonzales urged the Energy Commission to give serious attention to the city's concerns about the plant's potential impact on residents and the environment. ??As the project has been designed and proposed to operate . . . it would present an unfair burden to our community the mayor said. ??A spokeswoman for the Calpine/Bechtel partnership disagreed and characterized the plant as key to restoring energy stability in the Silicon Valley a region heavily dependent on imported power. ??This is the only project in the pipeline that can help Silicon Valley out of its predicament in the near future said the spokeswoman Lisa Poelle. ??She expressed hope that the governor's comments which cap numerous meetings between the partnership staff and Davis aides would encourage San Jose to soften its stance on the project. ??The 600-megawatt plant is proposed for a swath of open space currently leased to a rancher and occupied by grazing cattle. A preliminary ruling by Laurie and the other commissioner scrutinizing the project is expected by June. The full commission would take a final vote about a month later and if a license were granted the plant would begin operations sometime in 2003. ??From the beginning the plant has been dogged by opposition and the Energy Commission has held more than 20 hearings--an unusually large number--on its fate. ??On Wednesday a spokesman for its heftiest foe San Jose-based Cisco said the company still has serious concerns about health and safety issues. ??Cisco has strongly opposed the plant because the company wants to build a $ 1.3-billion headquarters for 20000 employees nearby. In the past Cisco officials have threatened to relocate to another state if the power plant is built. ??Company spokesman Steve Langdon said the firm's plans to build an industrial campus were not scuttled by the announcement Monday that it is cutting 8500 workers from its payroll because of slumping sales of its Internet networking equipment. ??But he suggested that the plans were flexible enough to be scaled down for a smaller work force and that the campus may not house the company's headquarters. ??It doesn't all get built at once he said. We will build and occupy the site over time in phases as needed. ??Another leading opponent of the power plant argued Wednesday that the Energy Commission lacks authority to override San Jose officials and license the project. The Santa Teresa Citizen Action Group launched by homeowners near the site says the commission may only take such a step if a better plant site hasn't been identified. ??The group charges that the commission is aware of other available sites including one in an industrial part of the East Bay area and lists eight other reasons the plant should not be built among them the noise and emissions it would produce. ??The local Sierra Club chapter however has endorsed the plant largely on grounds that it would run cleaner than existing plants in the area. By offsetting emissions from those older plants the new project would actually reduce air pollution said Kurt Newick of the Sierra Club's Loma Prieta chapter. ??On another front Davis continued to lobby legislators for support for his plan to rescue Southern California Edison from bankruptcy through purchase of the utility's transmission grid. ??Emerging from lunch with state Senate Democrats who are openly wary of the deal Davis said he'd made progress to bridge some of the gaps. It was the governor's third meeting in two days with lawmakers of both parties. ??Some of the toughest skeptics are members of his own party in the Senate. Many fear that the deal Davis struck with Edison will hand the utility too much at the expense of ratepayers and some say bankruptcy might be a better option for the state's second-largest private utility. Pacific Gas & Electric Co. filed for bankruptcy April 6. ??To assuage concerns Davis proposed that a special Senate committee be named to meet with his energy advisors as the administration and Edison finalize details of the deal before it goes to the Legislature for approval. ??Senate leader John Burton (D-San Francisco) who has called the Edison agreement problematic said he may appoint such a committee but continued to suggest that an Edison bankruptcy might be acceptable. ??Many of the Fortune 100 companies have gone into Chapter 11 bankruptcy and it ain't like the end of the world for anybody Burton said. ??* ??Times staff writer Carl Ingram contributed to this story. ??Powering Up California ??Power plant projects recently licensed by the California Energy Commission and when they are expected to go online: ??* ??* Two of four turbines are expected to go online in December 2001 the other two are expected to go online in March 2002. ??Source: California Energy Commission GRAPHIC: PHOTO: (2 photos) Gov. Gray Davis urges California Energy Commission to approve Metcalf Energy Center a 600-megawatt power plant planned for San Jose. Demonstrators greet Davis on his way to news conference in Sacramento. PHOTOGRAPHER: Associated Press PHOTO: (2 photos) Gov. Gray Davis urges California Energy Commission to approve Metcalf Energy Center a 600-megawatt power plant planned for San Jose. Demonstrators greet Davis on his way to news conference in Sacramento. ?PHOTOGRAPHER: ROBERT DURELL / Los Angeles Times GRAPHIC: Powering Up California Los Angeles Times LOAD-DATE: April 19 2001 of 63 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ??????????????????????????The Orange County Register 19 2001 Thursday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K7970 LENGTH: 275 words HEADLINE: Ex-energy chief leery of state buying power lines BYLINE: By Kate Berry BODY: ??ONTARIO Calif. _ Former Energy Secretary Bill Richardson said Wednesday that he is uncomfortable with the state's $2.76 billion purchase of the transmission lines of Southern California Edison because it would derail future plans to fully deregulate the state's electricity market. ??I'm leery of a state purchase Richardson said at an economic conference in Ontario adding that the jury is still out on a plan by Gov. Gray Davis to keep Edison out of bankruptcy. ??He called for a rescue of Pacific Gas and Electric the San Francisco utility that filed for bankruptcy two weeks ago. ??In a half-hour speech Richardson admonished the Bush administration for failing to take a more active role in the California crisis. He backs a one-year regional price cap to calm the volatile wholesale market. ??In the Clinton administration California was gold he said. With the new administration it's another ballgame. ??Richardson also pushed for a bipartisan energy bill with Democratic themes including energy-efficiency standards conservation and environmental regulations. ??We need an energy policy for this country that embraces both parties' proposals he said. ??Energy Secretary Spencer Abraham has sparred with Richardson by trying to rescind new energy-efficiency standards for air conditioners that were approved in the last 30 days of the Clinton administration. ??ARCHIVE PHOTOS available from NewsCom-PressLink: ??Richardson. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 The Orange County Register (Santa Ana Calif.). ??Visit the Register on the World Wide Web at http://www.ocregister.com/ JOURNAL-CODE: OC LOAD-DATE: April 19 2001 of 63 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ???????????????????APRIL 19 2001 THURSDAY FINAL EDITION SECTION: NEWS Pg. A18 LENGTH: 585 words HEADLINE: Alameda public utility rents four backup generators Extra electricity will be used during summer rolling blackouts SOURCE: Chronicle Staff Writer BYLINE: Matthew Yi DATELINE: Alameda BODY: Alameda's public utility announced yesterday that it is leasing four portable diesel electrical generators to avoid the one woe of the state's energy crisis they haven't been able to duck so far -- rolling blackouts. ???The utility's move to provide a backup source of electricity for its customers is part of a trend among city-owned utilities to gear up for expected power shortages during the dog days of summer. ???Healdsburg Santa Clara and Palo Alto -- all with their own electric grids -- are also initiating their own energy backup plans. ???The generators would kick in only during severe energy shortages when rolling blackouts are on the horizon. ???In Alameda four generators -- each the size of a tractor trailer -- arrived last week and are ready to be fired up Alameda Mayor Ralph Appezzato said yesterday. ???We're going to be the masters of our destiny he said. ???Alameda Power and Telecom is one of about 30 municipal utilities in California that opted not to deregulate with the rest of the state four years ago. Consequently its customers' power rates are expected to be stable this year while Pacific Gas and Electric Co. customers face huge rate increases. ???But municipal utilities such as Alameda's are still part of the statewide power grid which is managed by the Independent System Operator and are subject to rolling blackouts like everybody else when the state's energy reserves dip below 1.5 percent. ???Each of Alameda's four diesel generators will produce 1.5 megawatts of power. Each megawatt can light up 1000 homes utility officials say. ???The units leased at a total cost of $68000 a month through the end of the year are parked at Alameda Point. ???Their cost will be paid through the municipal utility's reserve fund and customers' power bills won't be affected said Junona Jonas the utility's general manager. ???I think in the long run we'll see more supply in the state but until that happens there will be communities that'll have to take these short-term drastic measures Jonas said. ???The utility's spokesman Matthew McCabe said the diesel exhaust from the generators won't be an environmental factor. ???Our environmental record is extremely important to us McCabe said. The diesel generators are only for emergency backup. . . . Besides these things are clean -- it's not like standing next to a diesel bus. ???The city is also getting help from the U.S. Maritime Administration which operates more than a dozen ships at the former Navy station in Alameda. When the juice is low those ships will unplug from the port and use onboard generators Jonas said. ???In the North Bay Healdsburg officials are waiting for the arrival of two diesel generators. Combined they are expected to produce 3.5 megawatts of power which can account for about 20 percent of the city's expected summer peak load said Bill Duarte city utility director. ???We're taking matters into our own hands he said. ???Farther south both Santa Clara and Palo Alto are considering leasing portable generators officials said. ???Bill Reichmann senior electric utility engineer at Santa Clara's Silicon Valley Power said the utility is planning to lease eight generators operating them in the southeastern end of town near the San Jose International Airport. ???Palo Alto's municipal utility also has recommended that the City Council approve renting two generators starting next month said spokeswoman Rima Johnson.E-mail Matthew Yi at myi@sfchronicle.com. LOAD-DATE: April 19 2001 of 63 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ???????????????????APRIL 19 2001 THURSDAY FINAL EDITION SECTION: NEWS Pg. A3 LENGTH: 845 words HEADLINE: Davis' gouging claims disputed Officials say no link between PG&E bankruptcy high prices SOURCE: Chronicle Staff Writer BYLINE: David Lazarus BODY: Officials on the front lines of California's energy mess yesterday challenged Gov. Gray Davis' assertion that the state is being gouged by power companies because of PG&E's bankruptcy filing. ???Such dissent from the governor's own subordinates could make it harder for Davis to gain support for his energy measures in the state Legislature. ???Despite Davis' latest claims the Department of Water Resources which is spending about $70 million a day buying power said there is no evidence linking recent price increases to Pacific Gas and Electric Co. filing for bankruptcy protection on April 6. ???It is a seller's market said Viju Patel executive manager of the Department of Water Resources' power systems department. The power companies do not need an excuse to raise prices. ???Critics say Davis' penchant for secrecy on energy issues has come back to haunt him at a time when he needs all the allies he can find. ???People aren't taking his words at face value said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. ???Republican lawmakers -- and even some Democrats -- have challenged a number of the governor's initiatives including a multibillion-dollar bailout scheme for Southern California Edison. ???Nevertheless Davis reiterated his belief yesterday that recent electricity price increases are an aberration driven by the bankruptcy of PG&E. ???He said California's spending on power jumped 40 percent in the week following PG&E's bankruptcy filing because generators say they face a greater risk of not being paid. ???Nothing else in the equation has changed said Steve Maviglio a spokesman for the governor. Everything is the same except the bankruptcy. ???However power companies were quick to challenge this assertion. They insisted that PG&E's bankruptcy actually was seen as a positive development by those in the energy business. ???If anything PG&E provides some solace for traders because the bankruptcy provides an organized mechanism for recovery of payments said Gary Ackerman executive director of the Western Power Trading Forum a Menlo Park energy-industry association. ???On the other hand he acknowledged that power companies are becoming increasingly wary of the state of California's creditworthiness as an energy buyer. ???The Department of Water Resources already has spent nearly $5 billion buying electricity and has yet to recoup a dime from ratepayers. State regulators are still trying to come up with a way to apportion the limited revenues from power rates among the various parties in California's energy picture. ???Rating agency Fitch Inc. said yesterday it may cut the state's credit rating because of questions surrounding recovery of energy costs. ???People are keeping an eye on things Ackerman said. They're watching how California finances things. ???If a premium on electricity sales to the state exists he said it probably has been in place since the beginning of the year well before PG&E's current woes. ???UCAN's Shames agreed. He said power companies added a risk premium to their California power sales late last year when it looked like the state's energy troubles were worsening. ???PG&E's bankruptcy may have increased the uncertainty Shames said but we've been paying a risk premium for months now. ???Richard Wheatley a spokesman for Reliant Energy in Houston insisted that his company's traders are not using questions about PG&E's or California's financial solvency as a fresh excuse for higher prices. ???I haven't seen any evidence of it he said. ???Mark Palmer a spokesman for Houston's Enron Corp. laid blame for recent price increases on low rainfall throughout the West which has cut output at hydroelectric facilities as well as on California's chronic power shortage. ???It's not that there's a premium on prices he said. It's just supply and demand. ???That said Palmer acknowledged that California's firm insistance on blackouts being avoided at all costs leaves the state vulnerable to virtually any price generators choose to demand. ???This means prices will be used to allocate a scarce resource he said. There's no other way it could work. ???Bottom line for consumers: It's going to be a long hot summer and electricity prices will soar even higher as demand surges. ???And despite the best efforts of state officials a daily threat of blackouts remains a virtual certainty as California's beleaguered power grid is stretched to the breaking point. ???At the Department of Water Resources' command center in a Sacramento shopping mall the state's team of electricity traders has moved onto a new high-tech trading floor where they negotiate power deals each day from the crack of dawn. ???The department's Patel said daily blackouts may be averted this summer after consumers see skyrocketing power prices reflected in their bills. ???People will respond to these prices and they are going to conserve like never before Patel predicted.E-mail David Lazarus at dlazarus@sfchronicle.com. GRAPHIC: PHOTO Gov. Gray Davis urged the California Energy Commission to approve construction of the proposed 600-megawatt power plant. / Associated Press LOAD-DATE: April 19 2001 of 63 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ???????????????????APRIL 19 2001 THURSDAY FINAL EDITION SECTION: NEWS Pg. A3 LENGTH: 888 words HEADLINE: Davis backs San Jose power plant He also acknowledges bailout for Edison will be uphill fight SOURCE: Chronicle Sacramento Bureau BYLINE: Lynda Gledhill DATELINE: Sacramento BODY: Gov. Gray Davis urged the state Energy Commission yesterday to approve a controversial power plant in San Jose saying California needs every megawatt it can harness. ???Davis' recommendation runs counter to the wishes of the San Jose City Council and Mayor Ron Gonzales who have come out against the 600-megawatt Metcalf Energy Center in south San Jose's Coyote Valley. It also puts the governor at odds with one of his political allies Cisco Systems chief John Chambers whose company opposes the plant because it would be built near the tech firm's proposed new campus. ???Davis' announcement came the same day he all but admitted he lacks the support he needs in the state Senate for the deal he reached with Southern California Edison to restore the utility to financial health. Davis has portrayed that deal and construction of new power plants as essential to making California's energy market functional again. ???I think when we have an opportunity to put more power on line we should seize it Davis said. I believe we spend too much time talking about Metcalf. It's time to start building it. ???The Energy Commission has been reviewing the proposal by Calpine Corp. and Bechtel Enterprises Inc. for months. The commission's staff recommended in October that the plant be built and a final decision is expected by summer. If it is approved the plant could come on line next year and provide enough electricity for 600000 homes. ???None of the five commissioners could be reached yesterday. Three are Democrats appointed by Davis and two are Republicans appointed by former Gov. Pete Wilson. ???Gonzales and the rest of the City Council rejected the Metcalf plant in November. Until yesterday Davis had sat on the sidelines as the energy crisis deepened and a long line of state and federal officials including four of the five Assembly members from Silicon Valley urged the commission to overturn the council's vote. ???Some neighborhood groups oppose the plant along with computer networking giant Cisco which hopes to build a 20000-worker campus on a neighboring parcel. Cisco chief Chambers donated $50000 to Davis in the first six months of last year. ???Cisco's reaction yesterday was restrained. ???We have great respect for the governor and respect his decision said Cisco spokesman Steve Langdon. ???However Langdon added: We still have serious concerns about health and safety issues related to the proposed power plant. ???Some neighbors were much angrier. ???He's trying to act like he's the big bad tough governor and he's spineless said Issa Ajlouny who lives in the Santa Teresa neighborhood less than a mile from the proposed plant. He knows the approval process isn't working in his favor so he's trying to come out and act like a hero to the state of California. But he's nothing but backstabbing the city of San Jose on the environmental issues. ???Supporters of the plant see the 14 acres of former junkyard as the perfect site -- right next to Pacific Gas and Electric Co.'s largest substation in the South Bay close to major transmission lines and shielded from its neighbors by a 350-foot hill. ???But a housing development is also nearby and residents fear the power plant will belch pollutants in an area already suffering from some of the worst air quality in the Bay Area. ???Mayor Gonzales continued to express his concern yesterday. ???I would support clean power plants that will help us achieve greater energy self-sufficiency for San Jose residents and business Gonzales said. As the Metcalf project has been designed and proposed to operate however it would present an unfair burden on our community. ???That's not what Davis said however calling Metcalf one of the cleanest most efficient plants in the country. ???Davis praised the efforts of Calpine/Bechtel to work with the local community and said he was especially pleased that the venture had agreed to commit all the power to the local region. ???The Silicon Valley is obviously the engine driving our economy but they are very dependent on outside power Davis said. ???Also in Sacramento yesterday after an hourlong session with Senate Democrats -- the toughest legislative sell for Davis' proposed Edison deal -- the governor all but admitted his plan could not win enough votes for Senate approval. ???I think he knew there weren't enough votes going in said Sen. Don Perata D-Oakland. But there may be a way of perfecting a deal people can at least think of supporting. ???Senate Democrats have openly opposed Edison's deal saying the only beneficiaries are Edison shareholders and power generators who would be paid every cent owed them by the utility -- at the expense of customers who would pay more to erase Edison's debt. ???Unlike his meeting with Assembly Democrats after which Davis said he was encouraged the governor said yesterday he wanted the Senate to appoint a special committee to iron out differences over the Edison deal. ???Senate President Pro Tem John Burton D-San Francisco said he was not aware a committee was being set up. He said he favored an up-or-down vote on Davis' current proposal.Chronicle staff writers Greg Lucas Alan Gathright and Maria Alicia Gaura contributed to this report. / E-mail Lynda Gledhill at lgledhill@sfchronicle.com. GRAPHIC: PHOTO Gov. Gray Davis urged the California Energy Commission to approve construction of the proposed 600-megawatt power plant. / Associated Press LOAD-DATE: April 19 2001 of 63 DOCUMENTS 2001 Pacific Press Ltd. Vancouver Sun ????????????????????April 19 2001 Thursday FINAL EDITION SECTION: BUSINESS Pg. F1 / Front LENGTH: 731 words HEADLINE: B.C. Hydro's credit to California firms exceeded 1999 guidelines BYLINE: David Baines SOURCE: Vancouver Sun BODY: ??A confidential document issued in late 1999 shows that B.C. Hydro's power-trading subsidiary Powerex set a credit limit of $100 million US for its California customers. ??However by the end of 2000 Powerex had extended three times that amount of credit to those customers -- the California Independent System Operator and the California Power Exchange. With the California Power Exchange and Cal-ISO's major customer Pacific Gas & Electric under Chapter 11 bankruptcy protection repayment of this debt is now in doubt. ??Powerex spokesman Wayne Cousins noted that the document obtained by The Vancouver Sun which is marked strictly confidential was issued in November 1999. ??That's an old copy of our risk-management policy he said in an interview Wednesday. ??Credit limits have changed since then based on careful assessment of several factors including market conditions risks maintaining long-standing relationships and helping California meet its electricity needs to prevent crisis situations. ??Temporary revisions were only implemented after very diligent review incorporating the best market intelligence available our own due diligence and on-going dialogue with appropriate market participants. ??He refused to say when the credit limits for Cal-ISO and the California Power Exchange were increased. ??That type of information is confidential. You have a copy that I assume was leaked in some way but this is commercially confidential information. ??He said the increase in credit limits helped B.C. Hydro achieve record net income of about $1 billion during the year ending March 31. This figures does not include any write-downs that may occur if Powerex determines that any of its customer accounts are not collectible. ??Cousins however was insistent that all debts will be collected: We continue to pursue monies owing and we expect to be paid for electricity we have sold. ??He noted that Powerex suspended trades to all California entities on Dec. 8 unless those trades were fully secured by creditworthy customers. ??By that time Cal-ISO and California had racked up an unpaid bill of about $ 300 million US or $475 million Cdn -- about half the net income that Hydro has tentatively reported for the year ending March 31. ??The confidential document states that Powerex's policies and procedures are designed to control the risk of financial loss due to changes in market prices or volatility and the risk that a counterparty (customer) in a commodity transaction defaults on delivery and/or settlement. ??It states that the amount of credit to be advanced to any customer depends on its credit rating. An AAA customer for example may be granted credit to a maximum of $20 million. ??Cal-ISO and California Power Exchange are not utilities they are power pools. They purchase power from Powerex and other suppliers and re-sell it to utilities such as Pacific Gas & Electric and Southern California Edison. ??The pools are not rated but are assigned specific credit limits. As of November 1999 Cal-ISO had a credit limit of $40 million US and the California Power Exchange $60 million US. ??The risk-management document notes that the credit-worthiness of these pools depends on that of its suppliers. ??The Powerex credit-risk manager and the treasury manager are responsible for initially evaluating and then monitoring the credit-authorization policies and credit limits for each power pool in which Powerex trades the document states. Significant alterations in the credit policies of a power pool will trigger a mandatory reappraisal of the power-pool credit limit. ??California has been caught in a power vice in recent months. The problem dates back to 1996 when the state developed a plan to deregulate the electricity business. Competition was supposed to lower rates below a price cap that had been imposed. ??However dry conditions cut the ability to generate hydro-electric power and a surge in the state's economy created unprecedented demand for electricity. Prices soared. ??The result was that the California utilities paid record prices for power but weren't allowed to pass along the full cost to consumers. ??Pacific Gas & Electric and Southern California Edison the state's two biggest utilities now owe about $12 billion. ??dbaines@pacpress.southam.ca TYPE: Business LOAD-DATE: April 19 2001 of 63 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ?????????????????????April 18 2001 Wednesday BC cycle SECTION: Business News LENGTH: 348 words HEADLINE: Williams again target of overcharging allegations from federal regulators DATELINE: TULSA Okla. BODY: ??Federal regulators are once against targeting Williams for allegedly overcharging Californians for electricity. ??The Tulsa-based energy company was cited in a notice this week from the Federal Energy Regulatory Commission for allegedly overcharging California customers $25574 in March. ??Two other companies were also cited in the notice from federal regulators Monday. ??Dynegy Power Marketing Inc. of Houston was cited for overcharging California customers $469662 while Mirant California LLC of Atlanta was cited for overcharges of $92620. ??The commission told Williams and the other two companies to either refund the money or justify their prices which exceeded a price of $300 per megawatt hour that was set by the Federal Energy Regulatory Commission because of the California's electricity shortage. ??Williams also was accused of excessive charges of $8 million in January and $ 21.6 million in February for a total of $29.6 million. ??Williams spokeswoman Paula Hall-Collins said while the overpricing allegations against Williams in March were not as significant as in the other months the process of justifying them will be the same as in previous months. ??They determine the price that they feel is fair and justifiable and then we come back and say why we charged what we did she said. ??Hall-Collins said federal regulators haven't said whether they are satisfied with how Williams justified its alleged overcharges from previous months. ??Also in March the commission accused Williams and AES Southland of generating less power to drive up electricity prices in May and June 2000 resulting in alleged overcharging of $10.8 million. ??Williams denies overcharging for electricity it provides. ??In other news Williams Express Inc. a unit of Williams announced Tuesday it was selling 198 MAPCO Express convenience stores to Israel-based Delek Group for $147 million. Most of the stores are in Tennessee and executives expect to close the deal by the end of May. ??Williams will keep 29 MAPCO stores in Alaska. LOAD-DATE: April 19 2001 of 63 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ?????????????????????April 18 2001 Wednesday BC cycle SECTION: State and Regional LENGTH: 332 words HEADLINE: Governor congressman to fight proposals for national power deregulation policy BYLINE: By MARGERY BECK Associated Press Writer DATELINE: LINCOLN Neb. BODY: ??Gov. Mike Johanns and Rep. Lee Terry R-Neb. said Wednesday they will be working to make sure national leaders understand Nebraska's stance on a national energy policy. ??Nebraska's unique status as the only 100 percent public power state in the nation and its reliance on the corn-based fuel additive ethanol make the state's input in the development of national energy policy important Johanns said. ??Public power has worked very well for Nebraska consumers by providing low cost electricity he said adding that the deregulated state of California has suffered through weeks of rolling blackouts. We are committed to protecting public power in this environment of deregulation. ??Terry said he has talked at length to the staff of Vice President Dick Cheney who has been tapped to come up with a national energy policy draft. That draft will end up before the House Energy and Commerce Committee on which Terry serves. ??There will be a discussion about a national deregulation policy Terry said. ??A national deregulation policy would threaten Nebraska's public power system Terry and Johanns said. Terry said he plans to push for a states' rights exemption to any such policy. ??It is absolutely necessary that Nebraska have a voice in that discussion Terry said. ??Terry said he also has pleaded with the Bush administration not to grant a request from California to wave the Clean Air Act's gasoline oxygen requirement. ??Such a move is considered a death knell to ethanol a clean-air fuel additive because other states would be expected to follow suit in requesting - and receiving - similar waivers thereby destroying ethanol's market. ??They did not telegraph their position on the waiver Terry said of White House which is expected to decide on California's request this spring. ??Other energy concerns Nebraska leaders hope to address are rising heating costs and gasoline prices which are expected to top $2 a gallon in Nebraska this summer. LOAD-DATE: April 19 2001 of 63 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune Business News 2001 San Jose Mercury News Jose Mercury News 18 2001 Wednesday KR-ACC-NO: SJ-POWER-PLANT LENGTH: 1038 words HEADLINE: California Governor May Back Energy Firm's Proposed Power Plant BODY: ??Under intense pressure to increase California's energy supply Gov. Gray Davis is expected to announce today his support for Calpine Corp.'s proposed South San Jose power plant -- a move that could ensure the state's most controversial power project is built. ??Davis said for months that he would not interfere in the environmental review of the proposed 600-megawatt power plant. But a source close to the governor said Davis has decided to use Calpine's Coyote Valley project to send a signal that California is ready to build more power plants and is open to business. ??San Jose has strenuously opposed the power plant. But Davis' decision to urge the California Energy Commission to approve it would likely hold sway with the agency which has authority over where plants are located but has almost never overridden local opposition. ??The commission -- three of whose five members were appointed by Davis -- is expected to complete its environmental review and make a decision early this summer. ??A spokesman for the governor declined to confirm the endorsement. But late Tuesday the governor scheduled a press conference for this morning to make an important energy generation announcement. ??San Jose Mayor Ron Gonzales declined to comment. But another of the plant's leading opponents pledged to keep fighting what would be the South Bay's largest power plant. ??An endorsement from Davis would cap a stunning turnaround for the project. ??Five months ago Calpine's Metcalf Energy Center was unanimously rejected by the San Jose City Council which decided that the power plant would be incompatible with the city's plans to develop high-tech campuses in North Coyote Valley. ??Some Calpine officials even considered giving up plans to build the power plant. ??But as California's energy woes intensified the Metcalf plant increasingly became a poster child for the need for more power generation to reduce the skyrocketing cost of electricity and avoid rolling blackouts. Silicon Valley one of the state's largest electricity consumers produces only a fraction of the energy it uses. ??Despite fierce opposition from local residents concerned about the environmental effects of a large power plant a steady stream of state and local organizations lined up behind the project including the Silicon Valley Manufacturing Group the San Jose Silicon Valley Chamber of Commerce and the local chapters of the Sierra Club and American Lung Association. ??The California Assembly voted unanimously in February to urge the energy commission to override San Jose and license the power plant. ??And top officials and attorneys at the energy commission have been working for months to ensure that the project wins approval a Mercury News investigation of the commission's environmental review of the project showed. The officials undermined negative environmental assessments of the Metcalf site and silenced commission analysts who said other sites would be better. ??The energy commissioners are weighing the staff's recommendation to approve the plant. ??Commissioner Robert A. Laurie who oversaw hearings on the project insisted at one hearing two months ago that the commission would complete an independent review. ??Although Davis has stressed his efforts to speed construction of new power plants the governor insisted he would not take a position on the project. ??The governor has repeatedly said he wants the process to play out Davis press secretary Steve Maviglio said last week. The governor believes the energy commission should complete its review. ??But there have been growing signs that Davis would throw his weight behind Calpine's project. ??A senior energy commission official said aides to the governor have been calling the commission for months to urge quick approval of the Metcalf plant. The governor's press secretary said no calls have been made. ??When Davis was looking for a backdrop to hold a press conference earlier this year to announce his plans to speed up approval of new power plants he chose Calpine's new plant in Sutter. ??The company also has actively campaigned for the governor's support. ??Earlier this year Calpine offered to sell the state cheaper power from the plant if it is approved. ??When Calpine and its development partner Bechtel Enterprises were looking for a lobbyist in Sacramento the companies turned to Platinum Advisors whose president Darius Anderson was finance chairman of Davis' 1998 gubernatorial campaign. ??The San Jose-based company gave the governor $ 19000 last year according to state campaign finance reports. ??Maviglio said the governor's ties to Calpine are no different from his relationship with Cisco Systems CEO John Chambers who has opposed the power plant. Campaign finance reports show Chambers gave Davis $ 50000 last year. ??Calpine officials said Tuesday they did not know of the governor's impending announcement. But they said they were not surprised. We've been working with the governor on a number of issues said project manager Ken Abreu. Metcalf is just one of them. ??Meanwhile Calpine's opponents in San Jose City Hall and in the neighborhood nearest the proposed power plant appear more isolated than at any time since the contentious debate over the Metcalf site began more than two years ago. ??Mayor Gonzales refused to comment on Davis' planned announcement. I don't respond to rumors said the mayor who has helped lead opposition to Metcalf. I have not heard anything. If he makes a statement I'll respond. ??But one of Calpine's fiercest local opponents said the nearby Santa Teresa neighborhood will continue to fight. We have a strong case said longtime South San Jose resident Issa Ajlouny. And we will win. ??The Mercury News strives to avoid use of unnamed sources. When unnamed sources are used because information cannot otherwise be obtained the newspaper generally requires more than one source to confirm the information. ??By Noam Levey and Mark Gladstone. Mike Zapler of the Mercury News contributed to this report. ??----- ??To see more of the San Jose Mercury News or to subscribe to the newspaper go to http://www.sjmercury.com JOURNAL-CODE: SJ LOAD-DATE: April 19 2001 of 63 DOCUMENTS 2001 Scripps Howard Inc. Howard News Service 18 2001 Wednesday SECTION: DOMESTIC NEWS LENGTH: 588 words HEADLINE: Davis says Edison agreement may need altering SOURCE: Scripps-McClatchy Western Service BYLINE: EMILY BAZAR and KEVIN YAMAMURA DATELINE: SACRAMENTO Calif. BODY: ??Gov. Gray Davis indicated Wednesday that he may need to alter the agreement to purchase Southern California Edison's transmission lines if he wants legislators to approve the deal. ??Though the Democratic governor declined to discuss particulars he said he asked Senate leaders to appoint a special committee dedicated to resolving disagreements between the administration and lawmakers. ??Many provisions of the memorandum of understanding the document that lays out the terms of the Edison deal must be approved by the Legislature and the state Public Utilities Commission. ??There is a determination to try and solve this problem whether or not it means amending the MOU or trying a slightly different approach Davis said after meeting with Senate Democrats. ??A spokesman for the utility declined to comment on the governor's statements. ??Davis announced the Edison agreement April 9 just three days after Pacific Gas & Electric Co. unexpectedly cut off transmission line negotiations with the governor and filed for bankruptcy protection. ??The deal would require the state to pay $2.76 billion for Edison's transmission lines or 2.3 times book value. In addition a portion of consumer electricity rates would be dedicated to paying off the remainder of the utility's debt estimated at about $5 billion. ??Both Edison and PG&E stockpiled massive debt when wholesale electricity prices soared. Price caps prevented them from passing along the entire cost of electricity to consumers. ??Since the Edison deal was announced however legislators have been critical of certain provisions suggesting that California consumers will receive little in return for relieving the utility of billions of dollars in debt. ??It's clear that the deal as is could well be problematic said Senate President Pro Tem John Burton D-San Francisco. This has to do with what's in the bill what's in it for the people of the state. ??Lawmakers initially believed they would have little ability to change the agreement and referred to it as a take it or leave it deal. ??In fact the memorandum of understanding itself says the deal can be nullified in the event any law is passed adopted or repealed ... (which) would materially impede or frustrate the ability of the Parties to effectuate all of the elements of the plan as a package. ??But in his meeting with Senate Democrats Davis indicated he may be willing to compromise. His goal he said is to keep Edison from following PG&E into bankruptcy. ??We still have some work to do Davis said. I think the appointment of a special Senate committee assuming that happens will let us work through the detail in an appropriate fashion. ??Burton said he has not decided whether to appoint a committee. ??Other senators came out of the meeting guardedly optimistic that they could compromise with the governor. ??It was obvious that there were concerns from members said Sen. Don Perata D-Alameda. He is open and ready to have the proposal perfected as it moves through the legislative process. ??Sen. Jackie Speier D-Hillsborough said she hopes to amend the deal to ensure power generators are penalized for over-charging the utilities and the state for electricity. ??The way it's presently crafted (generators) are being rewarded she said. They are getting a premium for selling electricity at a higher premium than ever conceived of by humankind. ??(Contact Emily Bazar and Kevin Yamamura of the Sacramento Bee in California at http://www.sacbee.com.) LOAD-DATE: April 19 2001 ??? What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Daily Research reports Body:: I would like to see research from all of these sources on areas of interest to enron -- energy and broadband North America and Europe. Thanks Henry Emery on 07/19/2001 12:03:17 PM To: undisclosed-recipients: cc: Subject: Daily Research reports Attached are two research reports that I can send to you on a daily basis. One of our many benefits here at our new location is the availability of various research sources. The two reports I have attached are from : The First Union Securities Equity Marketing Group and Merrill Lynch We also have access to Goldman Sachs research and CS First Boston Research. Please let me know if you would like me to continue sending these reports on a daily basis or if you have any particular companies that you are interested in hearing about. Sincerely Hank Emery - Spotlight071801.pdf.pdf - smith.pdf.pdf What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Dinner Plans Body:: I get in too late tonight but maybe dinner or drinks on Thurs? Linda Robertson 06/19/2001 06:39 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Dinner Plans You are here Wed and Thur nights. Do you have plans? Do you want to do something with some of the DC staff? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: We handed the Oped to DeLay's staff at lunch. I think we're finished for now. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ackerman to talk to Wolak Body:: Gary has been seeing Frank Wolak all over the place on the media scene. I asked him to ask Frank to do something POSITIVE and under the state's own control and push DA. Gary is also speaking to a bunch of CEOs (with Anjali of the ISO and Carl Wood) and he said he would carry our message to them as well. Sue Mara Enron Corp. Tel: (415) 782-7802 Fax:(415) 782-7854 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Board of Directors Meeting - August 14, 2001 Body:: calendar and meeting file ----------------- What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Wolak report Body:: Sue: I'm so impressed that you know how to put the link on the email. I can't figure out how to do that and I think that looks much more high tech than attaching a silly old report. Thanks for the link. We can take it from here. Sarah Susan J Mara 12/22/2000 11:31 AM To: Sarah Novosel/Corp/Enron@ENRON Donna Fulton/Corp/Enron@ENRON cc: Jeff Dasovich/NA/Enron@Enron Subject: Wolak report Call me computer illiterate. I could not figure out how to download the report off the web site so here's the link. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Time Magazine - Enron Plays the Pipes.... Body:: this is fantastic!! ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Refund Proceeding Privileged and Confidential Attorney Work Product Attorney-Client Communication Body:: Dan I need your help to make sure we get the appropriate evidence of these receivables into the record so as to offset refunds deemed to be due (if any after netting purchases and sales). As you will recall we submitted some documentation of the $40MM receivable to Judge Wagner. I expect that we will have to provide quite a bit (more) detail regarding this and the other receivables. Also who do you suggest for a witness on this or will affidavits be sufficient? Need your input on this since we may have to do additional research and now is the time to do it before the August 13 prehearing conference. Thanks! Ray ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Ken Lay/ Jeff Skilling visits Body:: No I had the right date from our previous communications. Nicholas O'Day 08/31/2000 09:25 PM To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/HOU/EES@EES Subject: Ken Lay/ Jeff Skilling visits I have noticed a fairly significant typo in the note below. The correct date for the key note address is 26 October as set out in my first note. Did that impact on the issue of availability? ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Speaking engagement with PUF Conference, on mergers, 9:00 a.m. - 10:00, give a 10-15 minute presentation, then youre on a panel. Body:: In Washington DC. Get Des to set up appointments What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Bahamas LNG Body:: I think it would be a good idea to get together. I would include Eric Thode as he has been living through the PR battles on a daily basis. James D Steffes 05/30/2001 08:31 PM To: Steven J Kean/NA/Enron@Enron cc: Richard Shapiro/NA/Enron@Enron Michael Terraso/OTS/Enron@ENRON Kelly Kimberly/Enron Communications@Enron Communications Subject: Bahamas LNG Steve -- In a discussion today with Mike Kelly etc. it was apparent that the Public Affairs team viewed the Bahamas LNG transaction quite cautiously. Given the recent issues power plant development has had in Florida (big political fights that are going the wrong way) I was wondering if it made sense to bring together a meeting of all of Public Affairs and the deal team to analyze the implications of our development plans. My primary worry is that P/L under water could have severe ecological implications that are not being internalized into the transaction. I would like to try and arrange a meeting to (1) ensure Public Affairs coordination and (2) understand the deal impacts better. Please advise if I'm worrying for no good reason. Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential --CFTC Chair Body:: Hi Steve Folks love Newsome and I think he's very nice and appears to be very free market. Spears the other Republican appointee is not at all free market in my view. I would not like this to mentioned anywhere else but I have found that the farm reps on the Commission may sound deregulatory but are not and have been really troublesome without a good free market person on board. And there are no truly free market persons on board at the Commission (every single other agricultural rep that I worked with on the Commission were trouble even though they claimed to be deregulatory -- and they were far worse before I got there and after I left.) I visited with Newsome a day before Inauguration and I was appalled at what they were planning to do concerning agency structure -- that would have elevated the regulatory lawyers and diminished the role of the economists at the agency. Misguided and showed to me a lack of understanding of how organizational structures can affect what comes out of an agency. I am often at odds with the industry view regarding CFTC issues. I don't think the futures exchanges who have a lot of power necessarily are pro-competition and many of the non-exchange folks who lobby on CFTC issues are Washington or New York (Democrat - which is why they want to involve Ken at this level) lawyers who do not understand markets and who are more interested in being able to claim influence or impact. The CFTC is in awful shape -- the quality of staff is horrendous and the Commission is relying on some of the worst people for their policy work (same folks that Brooksley Born used same folks who have advocated more regulation of the OTC market for years). Many quality folks do not want the job as Chairman because it's been such a backwater. I am looking for some good folks. Have at least one person who would be good at that job. And it's not Newsome. Please do not share this information with the usual folks as they hate me anyway (I'm too free market and have argued against their fixes). Sorry for this scathing review but this is an important appointment. Wendy What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Dinner with Craig Goodman - Cancelled Body:: 202-333-3288 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - ENhome Program Body:: The purpose of this message is to provide key areas (specifically IT Suppor= t=20 and Purchasing Organizations which might receive questions about the new=20 ENhome program) with preliminary information about the ENhome program as we= ll=20 as a standard message to deliver. The goal is to communicate a consistent= =20 message to all of our employees. Please keep in mind that changes are stil= l=20 being made at this time so your discretion is welcomed until the internal= =20 communication has been distributed. At the same time please inform the=20 appropriate individuals within your area that you believe might receive=20 questions. What is ENhome? An OTC approved program that will provide eligible employee= s=20 (active regular full-time and part-time employees whose business units ele= ct=20 to participate) at home with high-end internet devices broadband internet= =20 connection (where commercially available) and an employee-centric portal fo= r=20 personal use.=20 Attached to this message are three documents concerning this new program. = =20 These documents are: ENhome PowerPoint Presentation - High-level presentation provided to all of= =20 the Business Unit=01s Human Resource Departments describing the program. = =20 ENhome Draft of Internal Communications =01) This is a draft of the interna= l=20 communication that will be sent to eligible employees. I will send you the= =20 final copy when it has been approved. ENhome Q&A Draft =01) This is a draft of the Q&A document in case you may= =20 encounter these questions. Please review this document and if you feel the= re=20 are additional questions that need to be addressed let me know and I will= =20 work to get these answered. This program is scheduled to be announced to all eligible Enron employees a= t=20 either the end of this week or early next week. Remember that these=20 attachments are drafts and may be changed. As soon as I receive final=20 copies I will forward them to you. =20 Questions regarding the message from the Office of the Chairman concerning = =01&A=20 Computer for You and Your Family=018 should be responded to as: This program is being sponsored by Enron=01s Office of the Chairman and w= ill=20 be coordinated by Corporate Human Resources. The Global Information=20 Technology unit of Enron Net Works and Global Strategic Sourcing are workin= g=20 in conjunction with Corporate Human Resources to support this endeavor. =20 Details about this program are still being finalized and will be communicat= ed=20 as they become available. An eSpeak session will be scheduled in the near= =20 future where you will have an opportunity to ask questions. If you have any additional questions regarding this program or the=20 communications that will be released please feel free to contact me at=20 713-853-7947. Thanks Susan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: PG&E PX Credit Calculation -- CONFIDENTIAL ATTY CLIENT WORK PRODUCT Body:: Thanks for the thoughts. I fully agree on BF costs and DWR costs. I believe that you are right on Est RT$ = CAISOM Imbalance but I need to check. On the question of retroactive ratemaking it is my understanding that you are correct. PG&E probably won't rebill but will need to put in place an adjustment to the going forward PX Credit to collect the overpayment of Negative CTC. All of this means that the impact of the FERC refund is less than 100c on the $ for the Negative CTC. Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Weekly Retail Meeting, EB 27C1 Body:: John Anderson PTC/NERC Brad Petzold Power Nav -- John Henry (202) 466-0547 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Moving foward at a good clip Body:: Call at 5:00 today (3:00 your time) if you can. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meeting Notice - California Document Production Issues Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION Terminability of Val Verde interconnect agreement Body:: I've looked into whether we can terminate our Val Verde interconnect agreement with Burlington and have determined we may do so only if we take the following steps: 1. Terminate the OBA by giving 30 days notice to Burlington. Paragraph 13 of the 6/1/94 OBA with Burlington (as successor in interest to Meridian) provides that either party may terminate the OBA at the end of the primary term or thereafter by providing thirty (30) days prior written notice to Burlington. (The one-month primary term ended June 30 1994 and has since gone month-to-month.) 2. On the effective termination date of the OBA terminate the interconnect agreement by giving 30 days notice to Burlington. The 12/31/92 Interconnect Point Operating Agreement Paragraph 6 provides that either party may terminate on 180 prior notice after expiration of the primary term. This is of limited use to us since the primary term does not expire until 12/31/02. However the paragraph also provides that the agreement may be terminated by either party upon thirty (30) days prior written notice in the event the OBA between the parties is terminated. As we've already discussed termination of the agreement is an extreme measure from a customer relations standpoint and we probably need to weigh our other options first. Let me know if you have further questions. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Charts from Terry Thorn Body:: ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CHEMICAL MANUFACTURERS BOARD OF DIRECTORS MEETING - CONTACT IS TIM BURNS 703-741-5900 IN NAPLES FLORIDA, WANT TO GET THEM MORE ACTIVE, THEYVE ALREADY JOINED US, HAPHAZARD IN THEIR SUPPORT, DINNER ON THE 14, ASKED FOR SKILLING, CANT DO IT. Body:: Want you to speak from 10:15 - 11:00 ** Will be sending a letter this week (3/19/97) Flew to Austin on company plane What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: GENERATOR ORGANIZATION Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - JB 005 Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Draft Organizational Announcement about Japan Body:: Suggested changes are highlighted below. John Sherriff@ECT 04/24/2001 12:55 AM To: (713) 529-7757 Ken Rice/Enron Communications Kevin Hannon/Enron Communications Mark Frevert/NA/Enron Greg Whalley/HOU/ECT Mike McConnell/HOU/ECT@ECT Steven J Kean/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON Joseph P Hirl/AP/ENRON@ENRON Jeremy Thirsk/AP/Enron@ENRON Morten E Pettersen/AP/Enron@Enron Nicholas O'Day/AP/Enron@Enron Jackie Gentle/LON/ECT Richard Shapiro/NA/Enron@Enron Jeffrey McMahon/HOU/ECT Jeffrey A Shankman/Enron@EnronXGate Raymond Bowen/enron@enronxgate Joe Gold/LON/ECT@ECT Bryan Seyfried/LON/ECT@ECT Jeff Kinneman/HOU/ECT Rebecca McDonald/ENRON_DEVELOPMENT Carey Brian Stanley/EU/Enron Michael R Brown/LON/ECT Mark Evans/Legal/LON/ECT Fernley Dyson/LON/ECT Ted Murphy/LON/ECT@ECT Rick Buy/HOU/ECT Richard Causey/Corp/Enron Mark E Haedicke/HOU/ECT@ECT Drew C Lynch/LON/ECT David Oxley/HOU/ECT@ECT John J Lavorato/Enron@EnronXGate lkitchen@enron.co.uk cc: Subject: Draft Organizational Announcement about Japan May I please have your comments if any on this draft by close of business Wednesday. We hope to have agreed on the Q&A's by then and to send it out the announcement on Thursday. John To be sent to: All Enron Europe all employees in Japan all Global Markets and all VPs and up around the company Enron has established several wholesale businesses in Japan in the last year including Metals Power Plant Development (via our investment in EnCom) Coal LNG & Weather. We see significant opportunities in each of these businesses and we will continue to expand our presence in Japan in order to capture these opportunities. However while Japan continues to make progress towards a liberalized electricity market significant barriers to power trading remain under the current interim market structure. Until further tangible steps are taken to improve third party access for electricity in Japan we will suspend our power marketing efforts and focus on the significant opportunities that currently exist in our other wholesale businesses. [Any statement regarding our existing power sales commitment?] Once the necessary regulatory changes have been completed we expect to aggressively pursue Enron's traditional position as the leading buyer and seller of electricity in every deregulated market. We are making a number of organization changes in order to better align our resources with the opportunities in the Japanese market. [deleted text] Joe Hirl our President of Enron Japan will move to the Global Markets group and lead a team that will focus on developing all our Global Markets opportunities in Japan especially Weather Oil LNG Coal and Shipping. We expect to continue our general recruiting of Japanese nationals and as President of Enron Japan Joe will continue to provide the overall business leadership to both recruiting and the Analyst and Associate program in Japan. The Finance origination team headed by Jeremy Thirsk will continue to report to Joe and also move to Global Markets. Our power trading group led by Morton Erik Pettersen will transition into other roles around Enron. The Equity/FX/Interest rate team which is a part of Global Markets has two employees in the Tokyo office today and they expect to expand their efforts throughout the year. The EnCom group which is our power plant development business (with minority partners) and headed by Carey Sloan will continue its efforts in developing power plants in Japan. We are pleased with the progress we are making on a number of sites and EnCom will continue to report to the Enron Europe Office of the Chairman. Our Metals team headed by Kazunari Sugimoto will continue to report through Enron Metals in London. By May we expect Enron Credit to have two to three employees in Tokyo pursing the Credit Derivative business. These employees remain in Enron Credit a part of Enron Europe. EBS has two employees headed by Jim Weisser and this team expects to expand by year end. The Industrial Markets team also expects to have two employees in the Tokyo office in the next couple of months. In the last seven months the commercial support services for Japan have been transitioned to London for support and this is not changing. Jane McBride heads the legal team and will continue to functionally report to Mark Evans General Counsel in London. The RAC function will continue to report to Ted Murphy head of RAC for Enron Europe. The Risk Management and Accounting team is headed by Jan-Erland Bekeng will continue to functionally report to Fernley Dyson in London. The IT HR Tax and real estate teams will also continue to functionally report to London. Nick O'Day who heads the Public Affairs group (Government & Regulatory Affairs and the Public Relations) in Japan will report to the Enron Europe Office of the Chair with a Public Relations functional reporting to Jackie Gentle in London and a Government Affairs functional reporting to Rick Shapiro in Houston. We anticipate that his team's efforts will be primarily directed to supporting the EnCom power plant development team but they will also continue to provide support for Global Markets EBS & Industrial Markets. We have already made considerable progress in breaking into the Japanese markets across a wide range of Enron businesses and we anticipate that this will provide significant profit growth for years to come. Through these current changes we can demonstrate our ability to be flexible and target our resources where they will realise the most immediate value for the company. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RED Index shows Texas, NY, and Maine advance on retreating Pennsylvania Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Firsst article attached refers to the 1946 Nebraska case I mentioned to you= =20 in DC What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: ticket Body:: Another question. What about a Continental flight to Amsterdam and from Amsterdam to Warsaw? I can also fly Continental through Rome or London as long as I don't have to change airports. Vince What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CPUC Subpoena - Conference call TODAY! Body:: I won't be on the call but will fax my comments to you this am Twanda Sweet@ECT 10/06/2000 09:51 AM To: Steven J Kean/NA/Enron@Enron James D Steffes/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Mary Hain/HOU/ECT@ECT Jeff Dasovich/NA/Enron@Enron msmith1@enron.com david_aamodt@pgn.com mday@gmssr.com Mark Palmer/Corp/Enron@ENRON Mark E Haedicke/HOU/ECT@ECT gfergus@brobeck.com cc: Subject: CPUC Subpoena - Conference call TODAY! Please be advised that there will be a conference call today at 11:30a.m. central standard time to discuss the draft response to CPUC. The dial in number is 800-998-2462 (passcode 4672956). If you have any questions please call me at 713-853-5587. Thanks. Richard Twanda Sweet Enron North America Corp. EB3821 (713) 853-9402 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - General Expenses Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request Confidential Information by FERC Body:: We will be asking for confidential treatment unless and until the FERC requires similar information to be released by all market participants. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:CASH MICHELLE Email:michelle.cash@enron.com - 7138536401 Enron Wholesale Services - Office of the Chairman From: Mark Frevert Chairman & CEO Mark Haedicke Managing Director & General Counsel Subject: Confidential Information and Securities Trading To keep pace with the fluid and fast-changing demands of our equity trading activities Enron Wholesale Services (EWS) has recently revised its official Policies and Procedures Regarding Confidential Information and Securities Trading (Policies and Procedures). These revisions reflect two major developments: (1) our equity trading activities have been extended into the United Kingdom and (2) in an effort to streamline the information flow process the Review Team will play a more centralized role so that the role of the Resource Group is no longer necessary.You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: If you have already certified compliance with the Policies and Procedures during the 2001 calendar year you need not re-certify at this time although you are still required to to review and become familiar with the revised Policies and Procedures. If you have not certified compliance with the Policies and Procedures during the 2001 calendar year then you must do so within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Assoc PRC (4 Seasons) Body:: Hartsoe: PJM HoganSPP WSCCHebertdemocratic nominee ACA Andy Rotherham AAE membership (703)875-0764 Gordon Weil page Maureen Joe Allen Dave Marquart Richard Tabors What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Privileged & Confidential -- Verification Body:: nan What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fantastic Article in wash post on Refunds Body:: - California Changes Stance on Refunds Two Sides Far Apart In Energy Talks By Peter Behr Washington Post Staff Writer Friday July 6 2001 Page E01 California officials have abruptly shifted tactics in their attempt to recover billions of dollars in alleged overcharges for electricity saying they may reduce their demands for huge refunds if generators renegotiate $43 billion in long-term electricity contracts that the state signed this year. Gov. Gray Davis (D) said part of the $8.9 billion in refunds the state is seeking could be offset by reductions in energy prices in the long-term contracts whose costs have become a growing political embarrassment for Davis. We've made suggestions we've offered various ways in which people could get us $8.9 billion Davis told the San Jose Mercury News in a report yesterday. You can renegotiate our existing contracts and save us money. However you want to do it it's just got to net out close to $8.9 billion. The new offer was introduced this week into the closed negotiations over a California settlement being conducted in Washington by Federal Energy Regulatory Commission Judge Curtis L. Wagner Jr. according to sources close to the negotiations. Yesterday Wagner said he may issue his own preliminary finding today on the amount of overcharges if California officials and the generators cannot reach a compromise. What I'm trying to do is get people in a settlement mood Wagner told reporters. In the event we're unable to do that [Friday] at some point I may offer a preliminary assessment. The settlement conference is set to conclude on Monday. Wagner FERC's chief administrative judge has been trying to push both sides toward a compromise that would resolve the huge energy pricing controversy. Mountainous energy prices have bankrupted California's largest utility drained billions of dollars out of the state treasury and put Davis at sword's point with generators that help keep the state's lights on. Last Friday Wagner rebuked Davis's chief representative Michael Kahn chairman of California Independent Grid Operator -- the state's power grid manager -- indicating that the state's demand for nearly $9 billion in refunds from power generators and marketers was too high sources said. Wagner's settlement conference which has involved more than 100 lawyers for all sides is closed to the public and media. Wagner complained last month that Kahn was following a political agenda and his lack of independence in the negotiations was such a joke that the parties might as well wear clown suits according to a Dow Jones report confirmed by sources close to the talks. But he has also criticized the generators and power marketers led by Reliant Energy Inc. Williams Energy Services Duke Energy and Southern Co. for failing to make serious settlement offers these sources said. The suppliers have offered to refund $600 million provided the state is able to call off various California lawsuits demanding far larger refunds sources said. Wagner's leverage is his ability to propose his own refund figure to FERC's commissioners. FERC has tentatively called for $124 million in refunds but now is taking a harder line on preventing a new escalation of California's electricity prices this summer and is likely to be receptive to a higher refund figure some energy analysts believe. Davis's tactical change offering to make the long-term contracts part of an overall settlement comes amid growing criticism of what the state will have to pay for energy under those deals. California's energy calamity stemmed in large part from its failed deregulation plan which relied heavily on short-term power purchases at volatile spot market prices. When energy costs shot upward last summer so did the state's electricity bills. In response Davis's aide S. David Freeman and his staff began negotiating long-term power contacts with suppliers. The $43 billion in deals signed so far would require the state to pay about $70 per hour for a megawatt of power for a large part of the electricity it will need over the next 10 years. That's well under the average of $250 per megawatt-hour that the state was paying at the beginning of this year but above current power prices -- and considerably higher than what electricity may cost in the next decade energy analysts say. A new agreement to lower those contract prices could relieve political pressure on Davis and focus settlement negotiations away from the state's controversial demand for the $8.9 billion refund. Davis will argue that reducing future power charges that his administration negotiated should count as a refund because the deals were reached under commercial duress according to sources close to Wagner's negotiations. Industry supporters say Davis's refund figure is impossible to justify. There's no benchmark for what a fair and reasonable price should be said Michael Zenger California director of Cambridge Energy Research Associates. The state's advocates counter that if FERC enforced a just and reasonable standard for power prices based on operating costs and a generous profit the overcharges by all sellers could easily reach the $9 billion figure. It's not rocket science but it does require the regulators to regulate said Frank Wolak a Stanford University economist who heads an oversight committee for the California grid. Those polar-opposite views have left both sides in Wagner's conference room billions of dollars apart as the talks approached their final weekend sources said. 2001 The Washington Post Company What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Southeast RTO: Southerns Load Body:: The Barton discussion draft says that FERC's hands would be tied and that they would have to approve a proposed RTO as to size and scope if the proposed RTO owns or has operational control over transmission facilities that serve at least 40000 MW of load. Southern's CEO testified in Congress recently that their load is over 35000. I assume the 40000 MW minimum would permit the SeTrans proposal to meet the proposed statutory minimum since it is Southern plus a few munis as I understand it. Is this correct? Who would know how many RTOs there would be if each were just over the 40000 MW minimum? I assume it is much more than 4-5 RTOs -- if so this is a good contrast to use in our Hill efforts. Thanks. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential Attorney Client Privilege - Attorney Work Product Body:: The letter looks fine. Eric H's letter was addressed to market participants. Can we get EPSA or WPTF to file this letter? Alan C. Mary Hain 01/25/2001 04:58 PM To: Christian Yoder/HOU/ECT@ECT steve.c.hall@enron.com Richard Sanders James D Steffes/NA/Enron@Enron Joe Hartsoe@Enron Sarah Novosel/Corp/Enron@ENRON James E Keller/HOU/EES@EES Mike D Smith/HOU/EES@EES Harry Kingerski/NA/Enron@Enron Dennis Benevides/HOU/EES@EES Tim Belden/HOU/ECT@ECT Robert Badeer/HOU/ECT@ECT Jeff Richter/HOU/ECT@ECT gfergus@brobeck.com Alan Comnes/PDX/ECT@ECT Richard Shapiro Roger Yang/SFO/EES@EES Greg Wolfe@ECT Chris H Foster/HOU/ECT@ECT Steven J Kean/NA/Enron@Enron Richard Shapiro cc: Subject: Confidential Attorney Client Privilege - Attorney Work Product I have drafted the attached letter denying the Cal ISO's request to send it (and the EOB) EPMI and EES' cost information for transactions over the FERC's cost cap. Since I believe we are on very firm ground my initial inclination was to send no response to the ISO's letter so there would be nothing to quote in the press. However I drafted this letter at Alan's suggestion for purposes of discussion. We should decide whether to send a letter before distributing this draft more widely in-house to discuss how to parse the message. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Joao Neves Body:: Rita I have postponed all the hiring decisions till late August - early September. We can revisit Joao's case at this point. We shall have better information about the space in the new building we can count on and the time of the move. We appreciate Joao interest in Enron. Vince Kaminski What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Summary of Administration Comments on Bingaman Bill Body:: I have read through the 19 pages of Administration comments on the Bingaman draft electricity bill released last month. Here are the main items in a quick bullet format so you have the flavor of them. Delete provision on federal jurisdiction over bundled/unbundled (they don't offer a reason). We of course agree for tactical reasons. Add a provision to authorize FERC to order wheeling in States that open retail markets. Add a provision to allow FERC to issue wheeling orders on its own motion based on an informal hearing rather than an adjudicatory hearing as under current law. Make it clear that the Federal Power Act does not affect the authority of a State to require retail competition (the comments say some utilities have tried to argue that the FPA prohibits states). The provision giving FERC power to order RTO participation should be deleted. The comments raise drafting question. The changes to the FERC merger review sections of the FPA should be limited. FERC lite should be extended only to state municipal utilities and cooperatives not the Federal utilities. The FERC should authority over the Federal transmission systems equivalent to FERC authority over public utilities (with special BPA rules). No need to legislate on market-based rates (we oppose the Bingaman language anyway so this is helpful). Interconnection language should be limited to transmission facilities not local distribution. No objection to streamlined reliability provision (this is good for us). Remedial measures for market power should be deleted. Administration to provide legislative language on federal transmission siting provisions which they want to retain. Not convinced there is a need for market transparency rules because FERC and DOE already have enough authority. Administration supports even tougher criminal penalties. Recordkeeping under PUHCA repeal should be clarified. Federal purchase requirement for renewable energy should be deleted. No objection to real-time pricing standard. Net metering should be limited to small residential renewable facilities. Do not support federal renewable portfolio standard (but could clarify state authority to adopt same). What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Invitation Body:: Deniese Thanks for the invitation. I shall join you. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Japan Office Opening Ceremony Body:: I would like to do this but I have a speaking engagement the next day -- do the time zones work out so that I can do both or do I need to find a sub for the nov 1 speech? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FERC/SEC Update Body:: please print What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Chairmans Speech Body:: Re-read your reply. Just wondering what it means to possibly add a provision which I understand is a may -- dealing with FERC's authority to change existing RTOs. Depending on what that means it could seriously hamstring FERC's efforts for a 4-5 RTO model as sought and we support by not letting FERC change existing RTOs (particularly if that includes pending but not approved) to change. For example would the language under consideration block a Northeast RTO of PJM NY and NE since PJM is existing and NY has filed? What would be the rationale for such a serious limitation on FERC's authority? Thanks. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Jeff on CNN Body:: fyi -- further distribute this message as you see fit. ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Welcome New Associates - Reception Body:: calendar ----------------- What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Hold for Cynthia - possible meeting with Erskine Bowles (with Dr. Lay) and others Body:: Dept of ag What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Industry News: Charges of Gouging as Power Costs Skyrocket Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CA Price caps Body:: Oops. My computer sent the message before I was finished. I continue to hope that there is more opportunity than risk in this for us. Price volatility is in the news like never before and our main product is price risk management. I know that the inquiries are up I hope EES and ENA can get some sales out of it. More utilities have been approaching TNPC EES and ENA about taking over their merchant functions. On the policy side we are working the issue on both a state and federal level. Whether this country does anything meaningful to deal with the current crisis comes donw to one person ... Linda Breathitt. Ken Lay spoke with Secy Richardson and Sen Schumer about proposing rulemaking initiatives to FERC. We are working the RTO process hard elsewhere in the country and coming up with messages to arm our remaining allies around the country. THis is the biggest time for us on this issue since the very beginnings in California and New Hampshire. In the current panic however we will be decimated if we are associated only with a move to keep price caps from going into effect (I saw your message to Mona). I am going to read the comments next but I start off thinking we need to avoid running headlong into the price cap movement we may be better off trying to co-opt the movement to get broader reform. Hang in there. Susan J Mara 08/11/2000 11:56 AM To: Steven J Kean/HOU/EES@EES cc: Subject: CA Price caps I heard you've been raising a ruckus about our activities on the price caps -- asking us to do more. Thanks. I feel as if I have been a voice in the wilderness for the past six months when I was trying to get people to pay attention to the bad things happening in CA and warning that the problems (mainly a threat of reregulation) will spread elsewhere. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Greetings from London Body:: Hello Darrell I am in London this week looking among other things at our CreditDesk.com operation. I was trying to access your expert report from your web site but it's password protected. Can you send me a copy? Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Wed 6/6: Businesses vie for blackout exemptions:=20 The PUC must decide who should be spared and the applicant list is very lo= ng Sac Bee Wed 6/6: PG&E ISO agree to court order on power bills Sac Bee Wed 6/6: Peter Schrag: Turning up the heat in Houston and=20 Washington (Editorial) SD Union Wed 6/6: Is trading an insider's game? SD Union Wed 6/6: Daily energy costs for state fall in past weeks=20 SD Union Wed 6/6: Five tiers sought in proposed rate boost SD Union Wed 6/6: Port budget large but power bills loom SD Union Wed 6/6: Continuous use urged for planned power plant=20 SD Union Wed 6/6: Rising energy prices threaten Poway troupe=20 SD Union Wed 6/6: Fair to use generators for midway attractions LA Times Wed 6/6: 'Hi My Name Isn't Justice Honey' and Shame on Lockye= r =20 (Editorial) LA Times Wed 6/6: U.S. Probes Alleged Pact Not to Build New Plants Power:= =20 Justice officials focus on Southland operations of two firms which deny=20 wrongdoing LA Times Wed 6/6: Natural Gas Power Prices Drop Sharply Energy:=20 More conservation mild weather are among factors keeping costs down exper= ts=20 say LA Times Wed 6/6: The State Utility Averts $1 Billion in Costs Courts:=20 PG&E and Cal-ISO agree to recognize Department of Water Resources as=20 purchaser of the power SF Chron Wed 6/6: Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited SF Chron Wed 6/6: San Jose council gives green light to generating plant= =20 VOTE REVERSAL: Officials pressured to OK project SF Chron Wed 6/6: Developments in California's energy crisis SF Chron Wed 6/6: California conserves SF Chron Wed 6/6: L.A. power customers awash in cheap energy SF Chron Wed 6/6: PG&E doesn't want to pay for energy to avert blackouts Mercury News Wed 6/6: Metcalf plant gets preliminary approval=20 OC Register Wed 6/6: Feds probe AES Williams Individual.com (PRnewswire) Wed 6/6: Calpine Begins Construction of=20 Peaking Energy Center in Gilroy Calif.=20 Individual.com (PRnewsire) Wed 6/6: Reliant Urges FERC to Drop or Amend= =20 California Price Caps to Avoid Additional Shortages and More Blackouts Energy Insight Wed 6/6: Farm-fresh biopower --- Businesses vie for blackout exemptions: The PUC must decide who should be= =20 spared and the applicant list is very long. By Carrie Peyton and Dale Kasler Bee Staff Writers (Published June 6 2001)=20 Mixes for milkshakes and frozen coffees could spoil at ice cream parlors= =20 sickening customers.=20 Seniors getting their hair done would have to leave their dryers and go hom= e=20 with wet heads risking a chill.=20 Mall escalators could come to a sudden halt endangering shoppers who lose= =20 their footing.=20 Those are among the health and safety risks cited by more than 10000=20 businesses and government bodies asking state regulators to exempt them fro= m=20 rolling blackouts.=20 It is a list that mixes nursing homes and grocery stores outpatient surgic= al=20 clinics and beauty salons dialysis centers and country clubs.=20 A lot of people are treating this like a lottery said Subodh Medhekar of= =20 Exponent Inc. the consulting firm sorting through exemption requests for t= he=20 state Public Utilities Commission.=20 For many Medhekar said the rationale seems to be 'I'm pretty sure I won= 't=20 get exempted but what's the down side? Let's put in an application.' =20 Amid predictions that Californians could face dozens of rolling blackouts= =20 this summer state regulators are trying to update a decades-old list of wh= o=20 should be spared if the lights go out.=20 The Alta Sierra County Club in Grass Valley should be among those whose pow= er=20 stays on Sean O'Brien the club's golf course superintendent told=20 regulators in a nine-page application.=20 The country club telephones could go out making it harder to phone for hel= p=20 if someone has a medical problem while golfing he said in an interview.=20 And if the golf course's irrigation pumps shut down it would lose the=20 ability to quell small blazes -- leaving it to rely on a fire station O'Bri= en=20 said is about one-quarter mile away.=20 Placerville Dialysis wants an exemption too. As many as a dozen people the= re=20 can be having their blood pumped through an artificial kidney that cleans i= t=20 when their own kidneys no longer function properly.=20 When the power goes out everything just stops said manager Shirley=20 Carpenter. There is a way to manually return the blood by hand before it= =20 clots in the line. ... It would just be hectic.=20 It takes about five minutes of manual pumping to fully disconnect someone= =20 from a dialysis machine Carpenter said. And some patients can help by=20 operating their own pumps.=20 But she said I'm sure it would be kind of frightening to have your blood= =20 out in the line and the power off and they're pretty much tied to the=20 machine.=20 Pam Chin a hairdresser at the Loomis Beauty Salon said the owner sought a= n=20 exemption because people could get overheated if the air conditioning went= =20 out and older customers getting their hair set could be chilled if the=20 dryers shut off.=20 With about half the state already exempt from rolling blackouts the questi= on=20 of who else should stay connected has become a delicate one for utilities= =20 regulators and legislators.=20 Carl Wood the PUC commissioner who has taken the lead on blackout issues= =20 estimates that fewer than 1000 more utility customers can be exempted befo= re=20 they overload the rolling outage system designed to take stress off the=20 electric grid.=20 While about 6000 customers are classified as essential by the state's tw= o=20 largest utilities keeping them out of the blackout rotation also spares=20 about 5 million other customers who are served by the same circuits.=20 That multiplier effect will have to be weighed by the consulting firm by= =20 utilities and eventually by PUC commissioners who are scheduled to vote in= =20 early August on who should be added to existing standards.=20 The rules will apply to the state's investor-owned utilities Pacific Gas a= nd=20 Electric Co. Southern California Edison and San Diego Gas & Electric Co.= =20 but not to municipal utilities.=20 The Sacramento Municipal Utility District already rejected pleas for specia= l=20 exemptions from a medical lab a veterinary hospital nursing homes medica= l=20 facilities businesses and residents. SMUD believes they can weather=20 blackouts because they are not critical to public safety.=20 People have counted on having dependable electricity for so long that some= =20 have widely varying ideas of who can do without it safely Medhekar said.= =20 Of the more than 500 Baskin Robbins ice cream parlors that dot California= =20 only five are listed on the PUC Web site as applicants for exemptions.=20 The site cautions that its list of 9239 electronic applicants hasn't been= =20 checked for duplicates -- or fiction. It includes hundreds of outlets of th= e=20 same drug store and supermarket chains dozens of related nursing homes and= =20 more than 400 dentists. Another 1200 commercial power users have applied b= y=20 fax.=20 Among those who have confirmed they want out of outages are the grocery=20 chains operated by West Sacramento-based Raley's which said it took the=20 action as part of united effort with all California grocers who are worrie= d=20 about food spoilage.=20 Others in the mix are Fairfield's Westfield Shoppingtown Solano formerly t= he=20 Solano Mall where officials sought the exemptions out of fear that shopper= s=20 would get injured if escalators came to a sudden halt.=20 The Yolo County Housing Authority asked for an exemption on behalf of its 7= 00=20 dwellings in the belief that the utilities offer exemptions for low-income= =20 Californians Executive Director David Serena said.=20 Serena added that many of the authority's occupants are older or disabled a= nd=20 could be endangered by a blackout.=20 Chevron Corp. acknowledged it couldn't show that a blackout at its refineri= es=20 would present imminent danger to public health or safety but it asked Go= v.=20 Gray Davis to support legislation exempting makers and transporters for=20 critical fuels saying a refinery shutdown would cut into the state's=20 gasoline supply.=20 Some businesses acknowledged that their applications are a long shot.=20 It's probably a stretch said Amanda Leveroni who owns Bacio Catering Co= .=20 of Chico about her request to the PUC. The public wouldn't be in danger.= =20 But we're a catering company -- somebody has planned for a year-plus for a= =20 wedding or some big event she added. I would be in such a huge situation= .=20 I'd have to send out for pizza.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com. PG&E ISO agree to court order on power bills By Claire Cooper Bee Staff Writers (Published June 6 2001)=20 SAN FRANCISCO -- Pacific Gas and Electric Co. and the operator of=20 California's power grid agreed Tuesday to a preliminary court order providi= ng=20 that the utility will continue to receive -- but not pay -- generators' bil= ls=20 for the state's purchases of the most expensive wholesale electricity.=20 The tab has been running at about $300 million a month.=20 The order which U.S. Bankruptcy Judge Dennis Montali said he'll sign will= =20 specify that the Independent System Operator will not procure power except= =20 for a creditworthy buyer who has agreed to pay the generator.=20 In California the only such potential buyer is the state Department of Wat= er=20 Resources. However the department which has avoided PG&E Co.'s bankruptcy= =20 proceedings by claiming sovereign immunity will not be controlled by the= =20 agreement. Montali pointed out that the department still could demand=20 reimbursement from PG&E.=20 Under the agreement the ISO will not press any claims against PG&E on beha= lf=20 of generators if they are not paid.=20 The proposed preliminary injunction was based on an April order by the=20 Federal Energy Regulatory Commission which forbade the ISO from purchasing= =20 power on behalf of any non-creditworthy buyer such as PG&E.=20 The ISO is appealing the FERC order. If the appeal succeeds the injunction= =20 will end.=20 Peter Schrag: Turning up the heat in Houston and Washington (Published June 6 2001)=20 Behind all the palaver about the predictable standoff at last week's energy= =20 summit between President Bush and Gov. Gray Davis one major political=20 development was missed.=20 Put simply in the past month the focus of the California energy crisis an= d=20 maybe the onus as well has moved east: from the state's (and Davis')=20 handling of the mess to the generating companies energy marketers and gas= =20 pipeline companies that have richly profited from it and thus to FERC the= =20 do-next-to-nothing Federal Energy Regulatory Commission and the Bush=20 administration.=20 That wasn't all Davis' doing -- far from it -- though it's been at the hear= t=20 of his message about energy industry pirates and profiteers. Bush's=20 misbegotten energy plan and the administration's political clumsiness also= =20 contributed mightily not least by inadvertently giving Davis the chance to= =20 get media exposure he could only have dreamed about.=20 More important there's the defection of Sen. James Jeffords from the=20 Republican Party and the resulting shift of control in the U.S. Senate whe= re=20 the next chair of the Energy Committee will be Sen. Jeff Bingaman of New=20 Mexico a co-sponsor of Sen. Dianne Feinstein's bill capping wholesale=20 electric rates for the next two years. And chairing the Committee on=20 Governmental Affairs will be Sen. Joseph Lieberman of Connecticut who's=20 already asked for an audit of energy prices.=20 Those changes will draw a lot more attention to recent studies showing that= a=20 handful of big generators -- Duke Power Reliant Mirant Dynegy and the hu= ge=20 energy-marketing firm Enron -- have gamed the market to drive wholesale=20 prices to levels that in the year 2000 sometimes reached 40 times the=20 prices of the year before.=20 The findings come not merely from economists at the California Independent= =20 System Operator the agency that manages the state's grid who estimate=20 overcharges resulting from market power at $6.2 billion for last year alone= .=20 They come also from Severin Borenstein and his colleagues at the University= =20 of California Energy Institute who conservatively calculate the=20 overcharges at $4.5 billion from Paul Joskow a widely respected energy=20 economist at MIT and from Edward Kahn an economic analyst in San Francisc= o.=20 In a recent paper published by the National Bureau of Economic Research=20 Joskow and Kahn conclude that there's considerable evidence that the high= =20 prices experienced in the summer of 2000 reflect the withholding of supplie= s=20 from the market by suppliers [generators or marketers] exercising market=20 power. That those high prices occurred not merely during peak usage but al= so=20 at off-hours when no one had ever seen a price spike before makes those= =20 spikes even more curious.=20 There is in addition the powerful suspicion that the huge increase in=20 natural gas prices that a subsidiary of El Paso Energy Co. now the largest= =20 gas company on Earth was charging on the California side of the=20 California-Arizona border wasn't merely the result of an innocent imbalance= =20 between supply and demand.=20 None of that may be illegal. If there's no collusion there are no violatio= ns=20 of antitrust laws. But it adds plenty of steam to the political argument. I= n=20 the 2000 election cycle alone energy companies kicked in some $64 million = in=20 political contributions 75 percent of it to Republicans. At a time when=20 those companies many of them located in the same Houston neighborhood are= =20 racking up astronomical profits and when their collective coziness with Bus= h=20 and the Republican Party is a lot more than rhetoric their vulnerability t= o=20 a vigorous Senate investigation ought to be obvious.=20 The clincher is Blackout a Frontline program that both symbolizes the= =20 shifting emphasis and reinforces it. (The program is scheduled to be aired = at=20 8 p.m. Friday on Sacramento cable Channel 7.) It isn't another recital of= =20 Californians worrying about their electric bills or about the stupidity of= =20 the state's deregulation scheme or how Davis dithered in addressing the=20 crisis. It is about those generators and marketers in Houston and North=20 Carolina men (and a few women) who regard themselves as the heroes of the= =20 new energy markets.=20 The piece is reported by Lowell Bergman who in working for both Frontline= =20 and the New York Times has already broken major print stories about Duke=20 Power's secret approach to Davis offering unspecified energy refunds in=20 return for an end to state investigations and lawsuits. Bergman also report= ed=20 private conversations between Enron chairman Kenneth Lay a major Bush=20 supporter and FERC chairman Curt Hebert regarding the influence that Lay= =20 could exercise with Bush to allow Hebert to keep his chairmanship if Hebert= 's=20 supported certain decisions Enron badly wants.=20 None of these recent events is likely to end Davis' political woes and the= y=20 may not produce the wholesale rate caps Feinstein wants and that most=20 economists think necessary -- or maybe any significant reduction in the=20 industry's predatory pricing. But they will surely help turn up the heat= =20 both in Houston and Washington. Six months ago FERC found wholesale prices= =20 were not fair and reasonable as federal law requires but did little abou= t=20 them. It will now have a lot more questions to answer.=20 Peter Schrag can be reached at Box 15779 Sacramento CA 95852-0779 or at= =20 pschrag@sacbee.com. Is trading an insider's game?=20 Buying selling of electricity is a growth business but some say deck is= =20 stacked against consumers By Craig D. Rose=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 While Californians decry deregulation's failure to deliver a competitive=20 market electricity wholesalers have quietly developed a vast and rapidly= =20 growing business of buying and selling power among themselves.=20 The deals take place on high-tech trading floors in Houston and elsewhere= =20 around the country as well as on Internet-based trading systems.=20 Some experts say this electricity trading is a key mechanism for raising=20 consumer power prices yet it's largely unregulated.=20 Electricity trading is like buying stock -- when you have ability to chang= e=20 the stock price said Frank Wolak a Stanford University economics profess= or=20 and member of the state grid operator's market surveillance group.=20 Energy companies say the buying and selling of contracts to deliver power= =20 provides risk management allowing plant owners to presell their electricit= y=20 lock in prices and avoid fluctuations. The rough and tumble of the free=20 market they add is the most efficient means of allocating a resource like= =20 electricity.=20 But industry critics say trading is far from a competitive market paradigm.= =20 In their view it's a means of communication -- a way for energy insiders t= o=20 collude and raise prices under the guise of competition.=20 To be sure the trading arms of major energy companies have emerged as star= s=20 in an industry where profit surges of 300 percent or 400 percent are not=20 uncommon.=20 The transactions shrouded in secrecy can leave ownership of a critical=20 commodity in unknown hands. Consider the case of power generated by AES=20 Corp.'s California plants.=20 In 1998 AES made a bold move. Immediately after purchasing power plants th= at=20 gave it control of 10 percent of the state's electric generating capacity= =20 the company sold the output from its plants for the next 20 years to Willia= ms=20 Cos.=20 Williams did not sit on this treasure trove of electrons. The Tulsa Okla.= =20 company soon sold 80 percent of what it bought.=20 It is difficult to say who owns that power now. Some might be owned by Semp= ra=20 Trading a sister company of SDG&E. Or some could be owned by Enron Corp.= =20 the nation's biggest electricity trader.=20 A spokeswoman for Williams conceded that Williams itself may have repurchas= ed=20 some of the electricity it sold earlier. But trading companies closely guar= d=20 their positions.=20 This much can be said with certainty: Electricity that AES sold for less th= an=20 5 cents per kilowatt-hour to Williams changed hands perhaps 10 times in the= =20 wholesale market and emerged at times in recent months with a price tag for= =20 consumers that was 300 percent higher.=20 Williams' trading profits increased by 523 percent in the first quarter thi= s=20 year. Advance sales All this buying and selling creates curious confluences.=20 In their attempt to deflect criticism over high prices generating companie= s=20 such as Duke Energy -- operator of the South Bay Power Plant in Chula and= =20 others in the state -- frequently note that they sell most of their=20 electricity far in advance. But they acknowledge less often that their=20 trading units may also be buying power which could boost the company's=20 electricity inventory.=20 Duke was the fourth biggest electricity trader last year and cited its=20 trading activity as a prime contributor to its wholesale business profits= =20 which soared 324 percent in the first quarter to $348 million.=20 It is a company's power traders who frequently direct plant operators to=20 increase or decrease the generation of power in response to market=20 conditions.=20 Energy companies have little option but to turn to trading for profits. One= =20 of the better kept secrets of electrical deregulation and its promise of=20 competition is that there is remarkably little competition in the productio= n=20 side of the business.=20 For one thing electricity is a commodity power from one company is=20 indistinguishable from that generated by others.=20 More important nearly all modern plants generate power from turbines built= =20 by a handful of manufacturers. The result? Modern plants owned by different= =20 companies produce power at nearly identical cost.=20 The cost of power produced by modern plants is all within a mil=20 (one-thousandth of a dollar) said Michael Peevey an adviser to Gov. Gray= =20 Davis and former president of Southern California Edison.=20 So the extraction of profit in the electricity business relies much more on= =20 trading. Traders' profits rise when prices are volatile -- plunging or eve= n=20 better rising sharply. Little regulation But despite the obvious temptation to manipulate the market the burgeoning= =20 electricity trading business has remained largely unregulated.=20 The Federal Energy Regulatory Commission does require quarterly filings fro= m=20 energy traders but these often provide incomplete information or at least= =20 little that has been of concern to FERC.=20 In fact although the trading of electricity grew more than a hundredfold= =20 from 1996 to 2000 FERC has taken no major enforcement action against a=20 trader. After the onset of the California crisis last year FERC has acted= =20 once. That was against Williams which agreed to pay $8 million without=20 admitting guilt to resolve an allegation that it withheld supply to pump up= =20 prices.=20 FERC's record of enforcement in the area of power trading stands in contras= t=20 to a long list of enforcement actions within other markets taken by the=20 Securities Exchange Commission and the Commodity Futures Trading Commission= .=20 FERC has recently added staff to its market oversight operations. But Willi= am=20 Massey a FERC commissioner says the agency's effort is still inadequate.= =20 Electricity can be flipped stripped and chopped up Massey said. It's a= n=20 extraordinarily complicated market.=20 The sophisticated marketers and traders have simply moved past us. We're= =20 kind of horse and buggy in our approach and they're out there in rocket shi= ps=20 flying around ... The problem is that sophisticated traders don't necessari= ly=20 produce reasonable prices. They produce profits.=20 Before deregulation electricity trading was a low-key affair. Regulated=20 utilities dealt power back and forth on a reciprocal basis to fill=20 electricity shortfalls in their control areas. There was little trading for= =20 profit until the mid-1990s after federal legislation and FERC rulings open= ed=20 the market.=20 Major traders include large energy companies sister companies of=20 California's major utilities and Wall Street firms. Market volatility In many ways the trading of power is similar to that of other commodities.= =20 But there are important differences. Because it cannot be stored and its us= e=20 is so fundamental the price of electricity is the most volatile of all.=20 When supplies are tight a single supplier can rapidly raise prices to=20 budget-busting levels as evidenced by Duke Energy's recent admission that = it=20 charged California nearly $4000 for a megawatt-hour of power a quantity= =20 that probably sold hours earlier for one-tenth of that sum or less.=20 Wolak the Stanford economist and state Sen. Joseph Dunn D-Garden Grove= =20 who is investigating the state power market say trading allows companies t= o=20 collude under the guise of competition. Instead of wringing out lowest cost= s=20 the wholesale trading market serves to raise prices they say.=20 As I trade to you and you trade to me we communicate to each other what= =20 price we would like to get said Wolak. It's not collusive. It's just=20 communicating price.=20 Mark Palmer a spokesman for Enron the nation's biggest power trader said= =20 California's problem is not the result of trading.=20 It's a result of shortages Palmer said.=20 Underscoring its emphasis on trading Enron's new headquarters tower in=20 downtown Houston rises from a six-story block of new trading floors=20 including expanded space for electricity trading.=20 Enron also pioneered trading in cyberspace and its Enron Online site claims= =20 to be the most active computer-based trading market.=20 The Houston company argues that consumers won't fully benefit from power=20 trading and deregulation until they have greater choice in choosing their= =20 power supplier. And the company says FERC has not done enough to open acces= s=20 to transmission lines which would allow traders to move power around the= =20 country. To that end Enron has lobbied hard for President Bush's plan for = a=20 national electricity grid.=20 Palmer says the notion that the price of electricity rises each time it is= =20 traded is mistaken.=20 The market is always looking for the real price of a commodity Palmer=20 said.=20 Dunn the California state senator says his investigation found a differen= t=20 function for trading. At a time when supply barely meets or falls short of= =20 demand he noted companies with electricity to sell have to worry only abo= ut=20 how high to set their price.=20 The trader is a pawn in the generator's game to drive up prices said Dun= n.=20 Trading develops a level of trust. You my alleged competitor will bid in= =20 the same patterns and I will respond not in a competitive pattern but in a= =20 complimentary pattern.=20 The state senator said his investigation found evidence that on several day= s=20 energy companies appeared to test their ability to drive prices up without= =20 being undercut by competitors.=20 This ability to drive up prices without competitive consequence is a key te= st=20 of market power the technical term for manipulation or price fixing.=20 But Dunn also conceded that antitrust violations can be hard to prove in=20 court. He suggested that even if the trading behavior falls short of=20 antitrust violations it remains anti-competitive and devastating for the= =20 California economy.=20 To Harry Trebing a utility industry expert and professor emeritus at=20 Michigan State University wholesale electricity trading is reminiscent of= =20 what took place in the 1920s and early '30s. Back then utility companies= =20 created complex networks of holding companies that traded stock among=20 themselves driving up prices in the process.=20 Undoing that scheme was a focus of President Franklin Roosevelt's=20 administration. Congress ended up barring national power companies and=20 tightening regulation of utilities in an effort to counteract their tenden= cy=20 to create markets that work only for insiders.=20 The broad goals of trading are the same Trebing said.=20 The goal is to maximize profits through raising prices.=20 Daily energy costs for state fall in past weeks=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 SACRAMENTO -- In some of the first good news of the electricity crisis the= =20 Davis administration said yesterday that the daily cost of power purchased = by=20 the state for utility customers has dropped in recent weeks.=20 The price-drop news comes after an announcement that Californians conserved= =20 more energy than expected last month 11 percent and amid Davis=20 administration optimism that the Legislature may finally begin to move on a= =20 plan to keep Southern California Edison out of bankruptcy.=20 The developments if they turn out to be a trend and not temporary could b= e=20 among the first signs that Gov. Gray Davis' plan to end the electricity=20 crisis is beginning to work. But the administration isn't saying that.=20 We have had a few good days here lately said S. David Freeman a Davis= =20 power adviser. I don't think that I want to project.=20 Some power-market watchers began to speculate last month that prices may ha= ve=20 peaked earlier this year. Platts an energy information service said=20 yesterday that spot prices for the natural gas used by power plants are=20 falling this month.=20 The governor's press secretary Steve Maviglio told reporters yesterday th= at=20 the daily amount spent on power is now well below $50 million which was= =20 the average cost earlier this year.=20 A 12-day gap in the most recent notice to the Legislature that another $500= =20 million increment will be spent on power suggests that the daily average=20 during the last two weeks may have dropped down around $42 million.=20 Oscar Hidalgo a spokesman for the state power purchasing agency said that= =20 the average cost of power was under $40 million during the first four days = of=20 this month.=20 Maviglio attributed the lower cost to conservation the phasing in of cheap= er=20 long-term power contracts fewer power plants off-line for maintenance and= =20 cooler weather.=20 However he said The average cost is still way over what we paid last=20 year.=20 There was widespread skepticism in late April when the governor's consultan= ts=20 predicted that the $346 per megawatt-hour average paid by the state for=20 non-contracted power from April through June would drop to an average of $1= 95=20 from July through September.=20 We are still very comfortable with the projection that Mr. Fichera and=20 company estimated Maviglio said referring to Joseph Fichera of Saber=20 Partners in New York.=20 During a briefing on May 21 Fichera told reporters that the amount of powe= r=20 that the state would obtain under long-term contracts for May was expected = to=20 be about 43 percent of the total required the so-called net short.=20 Fichera said contracts already signed were expected to cover 66 percent of= =20 the net short in June 48 percent in July and 42 percent in August. He sai= d=20 contracts that had been agreed on in principle could increase those amounts= =20 to 73 percent in June 67 percent in July and 60 percent in August.=20 We are still on target. There are risks Fichera said yesterday among th= em=20 extended hot weather and power plant outages. No one is popping the=20 champagne corks until Sept. 30.=20 The governor's consultants based their forecast of power demand this summer= =20 on an estimate that Californians will reduce their electricity use by 7=20 percent.=20 The 11 percent reduction last month as compared to May of last year came= =20 before the sticker shock of rate hikes that begin this month for customers = of=20 Edison and Pacific Gas and Electric. And a $35 million ad campaign urging= =20 conservation has not hit full stride.=20 Maviglio said the administration plans to release some detailed information= =20 on Monday about the roughly $8 billion the state has spent buying power. Th= e=20 general fund will be repaid by a bond of up to $13.4 billion that ratepayer= s=20 will pay off over 15 years.=20 Legislative leaders have demanded detailed information about power purchase= s=20 before proceeding with the Edison plan. Assembly Democrats are working on a= =20 plan that de-emphasizes state purchase of the Edison transmission system an= d=20 would put most of the burden for paying off Edison's debt on businesses and= =20 large users not residences. Five tiers sought in proposed rate boost=20 Conservation would be promoted SDG&E says By Karen Kucher=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 A proposed rate increase for SDG&E customers to cover the high cost of=20 electricity should be imposed in five tiers to encourage conservation the= =20 company is advising state utility regulators.=20 The more electricity a customer uses the higher the rate would be.=20 SDG&E needs to raise its rates to bring in an additional $502 million=20 annually to pay the state for power purchases.=20 The state Public Utilities Commission is expected to rule on San Diego Gas = &=20 Electric's rate-increase proposal June 28.=20 The rate changes would remove a cap that has shielded most SDG&E customers= =20 from rising electricity prices for a year. The cap enacted by state=20 lawmakers in September 2000 and retroactive to June 2000 set rates at 6.5= =20 cents per kilowatt-hour.=20 Higher rates would mean the average SDG&E residential and small-business=20 customer's electricity bills would go up by 18 percent. Large commercial=20 users' bills would average 29 percent more.=20 Public hearings on the issue will be held next Monday and Tuesday in San=20 Diego El Cajon Escondido and San Clemente. These sessions will focus on= =20 small-business and residential consumers. Hearings on large commercial user= s=20 were held last month.=20 Earlier this year the PUC decided to allow the state's two largest=20 utilities Pacific Gas and Electric and Southern California Edison to char= ge=20 customers an extra $5.7 billion annually for electricity.=20 The state Department of Water Resources which has been buying power for=20 SDG&E customers since February asked SDG&E to generate a total of $915=20 million annually to cover the cost of electricity purchases.=20 With the proposed rate increases SDG&E could do that.=20 Large commercial customers would pay about 30 percent of the overall increa= se=20 and residential and small-business customers would pay about 70 percent sa= id=20 Ed Van Herik a spokesman for the utility company.=20 If the increase can be tiered as many as 60 percent of residential custome= rs=20 will see no rate increase if their electricity usage remains the same Van= =20 Herik said.=20 But customers who use more than 130 percent of their baseline -- considered= =20 the minimum amount of electricity needed by a household -- will be billed a= t=20 increasingly higher rates.=20 Residential and small-business customers who use a lot of electricity could= =20 pay as much as 17.89 cents per kilowatt hour for some power they consume.= =20 Consumer advocate Michael Shames said he is concerned the utility's proposa= l=20 does not spread the increases evenly among different types of users. He als= o=20 called for more scrutiny of the state's request.=20 People should tell PUC officials that this increase should not be a carte= =20 blanche or blank check approval said Shames the head of Utility Consumer= s'=20 Action Network. The PUC needs to ensure that the rate increase requested b= y=20 the (state) is reasonable.=20 The public hearings are scheduled for:=20 ?Monday 1 p.m. San Diego Concourse Copper Room 200 C St. San Diego.=20 ?Monday 7 p.m. El Cajon Community Center 195 E. Douglas Ave. El Cajon.= =20 ?Tuesday 1 p.m. Country Inn Hotel 35 Via Pico Plaza San Clemente.=20 ?Tuesday 7 p.m. Center for the Arts 340 N. Escondido Blvd. Escondido.= =20 Port budget large but power bills loom=20 Slowing economy also cause for worry By Ronald W. Powell=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 The rock is rolling financially but there are indications that the blues= =20 lurk on the horizon.=20 Officials of the San Diego Unified Port District -- headquartered in a=20 block-shaped building some employees call the rock -- are happy with a=20 projected 2001-2002 budget that is 5.1 percent larger than the current one.= =20 Total revenue is expected to reach $208.7 million $10.2 million above what= =20 is expected in the fiscal year that ends June 30.=20 Port commissioners gave preliminary approval to the budget yesterday and ar= e=20 scheduled to take a final vote July 10.=20 But a slowing economy and surging electric bills are causes for concern.=20 Electricity costs are expected to rise from $5 million to $8.2 million in t= he=20 coming fiscal year.=20 As far as trends we see a continuation of the growth we've experienced ov= er=20 the past five years said Bruce Hollingsworth the port's treasurer. But= =20 our percentage of growth will not rise as sharply.=20 Port revenues have grown steadily since the 1997-1998 fiscal year when $16= 3=20 million was generated.=20 The proposed budget calls for adding 24 employees to the port's 730-member= =20 work force. New hires will include three Harbor Police officers 10 employe= es=20 in the aviation division and four in maritime services.=20 The port operates Lindbergh Field and administers nonmilitary tidelands alo= ng=20 San Diego Bay. It is landlord to more than 600 waterfront businesses and=20 operates two marine cargo terminals and one cruise ship terminal.=20 The budget calls for growth in each of the port's primary revenue centers:= =20 aviation real estate and maritime services.=20 Passenger and cargo activity at Lindbergh Field is expected to generate $90= .7=20 million or $5 million more than expected in the current year. Most of that= =20 increase is expected to come from parking-rate increases at the airport and= =20 at the port's long-term parking lot on Pacific Highway.=20 Rent from hotels and other businesses that are port tenants are expected to= =20 total $63.1 million up $1.8 million from the current budget.=20 Increases in cargo and cruise ship traffic are expected to boost maritime= =20 income by $2.7 million to a total of $18.4 million.=20 The port expects to spend $157 million on construction projects. They inclu= de=20 $8.5 million to relocate the General Services Department from Eighth Avenue= =20 and Harbor Drive in San Diego to National City and more than $5 million for= =20 paving and improvements at the 10th Avenue Marine Terminal.=20 Rent revenue could grow substantially in future years. Four hotel projects = on=20 port property have won approval or are seeking it.=20 Jim Bailey president of Manchester Resorts told commissioners yesterday= =20 that he expects to break ground on a second Hyatt tower of 750 rooms by Jun= e=20 26. Port officials said revenue from that hotel would bring in an additiona= l=20 $3.7 million a year. It is scheduled to open in the summer of 2003.=20 Hollingsworth the treasurer said that if all four hotels are built the po= rt=20 could receive as much as $15 million a year in new revenue.=20 Continuous use urged for planned power plant=20 Escondido facility originally proposed for peak demand By Jonathan Heller=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 ESCONDIDO -- A proposed power plant in southwest Escondido that initially w= as=20 expected to run only during times of peak electricity demand probably will = be=20 allowed to run full time.=20 A state energy official who recommended approval of the plant yesterday has= =20 said the plant could operate as often as the state deems necessary.=20 The California Energy Commission was scheduled to vote on the project today= .=20 CalPeak Power of San Diego has asked the commission to approve a 49-megawat= t=20 plant on Enterprise Street near Vineyard Avenue. Referred to as a peaker= =20 plant such facilities typically are designed to supply energy only during= =20 times of peak demand.=20 The state limits the number of hours some plants can operate to keep=20 pollution at a minimum. A 44-megawatt peaker plant being built on West=20 Mission Avenue in Escondido by Ramco Inc. will be allowed to operate no mor= e=20 than 16 hours per day.=20 That plant is permitted to emit up to 5 parts per million of nitrogen oxide= =20 although its actual emissions are expected to be slightly lower said Dale= =20 Mesple a Ramco consultant. Nitrogen oxide is a component of smog.=20 The CalPeak plant if approved would be restricted to 2 parts per million = of=20 nitrogen oxide.=20 It was generally assumed that the CalPeak plant would operate under similar= =20 time restrictions as the Ramco plant. The potential for air pollution was= =20 among the chief concerns of residents who spoke at the City Council hearing= s=20 on the Ramco project and at the energy commission hearings about the CalPea= k=20 plant.=20 But under the terms of approval recommended by Energy Commission Chairman= =20 William Keese CalPeak's plant would be able to operate up to 8760 hours= =20 per year typically when the demand for electricity is high. That number= =20 equals 24 hours a day.=20 The actual number of hours would depend on the requirements of the state's= =20 Independent System Operator which manages the energy grid.=20 We certainly want to have the flexibility to run whenever we're needed= =20 said Mark Lyons CalPeak's development director. Exactly how often we will= =20 run is anybody's guess.=20 Escondido Councilwoman June Rady said she was frustrated by the possibility= =20 of the plant running full time. In Ramco's case the city and the county Ai= r=20 Pollution Control District made it clear how often the plant could operate.= =20 CalPeak chose to bypass the city's permitting process and went through the= =20 state Energy Commission which offers an expedited 21-day approval put in= =20 place by Gov. Gray Davis as an emergency measure.=20 I think Escondido has been absolutely ignored and there's a total lack of= =20 due process Rady said. It boils down to an issue of local control.=20 Although city officials objected to the commission pre-empting the city's= =20 land-use authority the commission maintained that Davis' order gave it the= =20 final say on this type of project.=20 If the commission gives final approval today the only remedy available to= =20 the city would be in court. At least three council members must vote to=20 initiate legal action.=20 Keese's recommended approval did take into account several city concerns=20 regarding landscaping. The CalPeak plant would be built near the entrance o= f=20 a planned high-tech business park and city officials were worried the=20 plant's appearance might hinder the ability to attract high-quality tenants= =20 to the park.=20 Mayor Lori Holt Pfeiler said she was not surprised by the commission's=20 recommendation.=20 I expected they would want to approve the project and that's why it was= =20 important for the city to weigh in with conditions we have in this=20 community Pfeiler said.=20 Rising energy prices threaten Poway troupe=20 By Brian E. Clark=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 POWAY -- Rising electricity rates may extinguish the stage lights this summ= er=20 for the Poway Performing Arts Company.=20 I'm afraid that if SDG&E gets the price increase it's asking for -- from 6= .5=20 cents per kilowatt-hour to 8.9 cents -- that we'll go under said Kathy=20 McCafferty spokeswoman for the nonprofit theater.=20 The volunteer organization produces its plays in a building at a Poway Road= =20 shopping center. It held three fund-raising performances over the weekend= =20 but officials were uncertain yesterday how much money was raised.=20 The group is not affiliated with the Poway Performing Arts Center and has= =20 been in business for 20 years.=20 McCafferty said the group built up a $2000 surplus last summer before ener= gy=20 prices began to surge.=20 That $2000 was a big reserve for us she said. It seemed like a ton of= =20 money but boy it went fast. And we're really energy-dependent. Our light= s=20 use a lot of power. And we're in Poway on the second floor of our building.= =20 It gets hot here and we have to use air conditioning.=20 But McCafferty acknowledged that the cost of power isn't the group's only= =20 problem.=20 In a recent letter to backers President Nan Katona said the organization= =20 also needs new blood to keep operating.=20 The truth is that lack of funding is just a symptom of the deeper problem= =20 which is lack of community support she wrote. Ironically audiences and= =20 reviewers recognize the Poway Performing Arts Company as one of the premier= =20 community arts theaters in San Diego.=20 Katona said some new volunteers had stepped forward to take leadership role= s=20 in the theater company since she wrote her letter last month. But she said= =20 rising electricity prices could still bring the group down.=20 If our energy bills double or triple we could be in dire straits she=20 said. It could push us over the edge financially.=20 McCafferty said it would be difficult for the theater to cut costs.=20 We can't run a much leaner operation she said. If our power prices go u= p=20 again we may still be forced out of business.=20 The theater is at 13250 Poway Road in the Lively Shopping Center. For more= =20 information call (858) 679-8085.=20 Fair to use generators for midway attractions=20 By Michael Burge=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 DEL MAR -- The Del Mar Fair will generate its own electricity for thrill=20 rides on the midway this year instead of using energy from SDG&E.=20 In case there are planned or unplanned outages we still will be operating= =20 fairgrounds General Manager Timothy J. Fennell said.=20 Fennell decided to put the midway on generators because he didn't want the= =20 fairgrounds pulling power from the grid while county residents are coping= =20 with rolling blackouts at home and at work he said.=20 And the fair does not want to take a chance that a rolling blackout will=20 leave some people stranded in rides high above the grounds forcing an=20 evacuation.=20 The fairgrounds has been told it is exempt from rolling blackouts but rath= er=20 than take such a risk it will rent 13 diesel-fuel generators and produce=20 electricity on the midway. The rest of the fairgrounds will use power from= =20 San Diego Gas & Electric Co.=20 Fairgrounds operations manager Larry Baumann estimated it would cost the=20 fairgrounds $20000 more to generate its own electricity than to buy it fro= m=20 SDG&E.=20 Midway manager Donna Ruhm said it will be worth it.=20 Rides that require evacuation have to have backup power and they do Ruhm= =20 said. Now our service won't be interrupted.=20 It is not unusual for carnivals to generate their own power and the=20 fairgrounds has done so in the past. Fair officials removed the generators = 10=20 to 15 years ago to reduce noise on the midway.=20 The fair opens June 15 and ends July 4.=20 While the rest of the fairgrounds is on the SDG&E grid Baumann said backup= =20 generators can kick in during a typical 60-or 90-minute blackout allowing= =20 the fair to operate without serious difficulty. Those generators are not=20 linked to the midway.=20 All the generators are licensed by the state and meet emission standards= =20 fair officials said so they do not expect the noise and odor to be=20 excessive.=20 The fairgrounds is taking the precaution of providing its own power despite= =20 the fact that it probably will not go dark during a rolling blackout.=20 SDG&E has assured me that .?.?. the fairgrounds and the racetrack will not= =20 be on the curtailment (blackout) list during the fair and the races said= =20 Del Mar Fire Chief Jack Gosney.=20 The Del Mar Thoroughbred racing season begins July 18 and ends Sept. 5.=20 Gosney said SDG&E told him earlier this year that the fairgrounds was not= =20 subject to a forced outage because it shared a circuit with the Del Mar Fir= e=20 Station which is a 911 dispatch center and exempt from a blackout. But he= =20 said recent research showed that the fairgrounds is on a separate circuit.= =20 Nonetheless Gosney said SDG&E is exempting the fairgrounds and racetrack= =20 during the busy summer season.=20 The fairgrounds paid $137152.95 for its electricity usage from March 12 to= =20 April 10. It paid $51845.39 for electricity during the same period last ye= ar. ?=20 Wednesday June 6 2001=20 'Hi My Name Isn't Justice Honey' and Shame on Lockyer=20 By TOM G. PALMER ?????Here's what California Atty. Gen. Bill Lockyer said at a press=20 conference about Enron Corp. Chairman Kenneth Lay: I would love to=20 personally escort Lay to an 8-by-10 cell that he could share with a tattooe= d=20 dude who says 'Hi my name is Spike honey.'=20 ?????Here's why Lockyer should be removed from his office of public trust:= =20 First because as the chief law enforcement officer of the largest state in= =20 the nation he not only has admitted that rape is a regular feature of the= =20 state's prison system but also that he considers rape a part of the=20 punishment he can inflict on others.=20 ?????Second because he has publicly stated that he would like to personall= y=20 arrange the rape of a Texas businessman who has not even been charged with= =20 any illegal behavior.=20 ?????Lockyer's remarks reveal him to be an authoritarian thug someone whol= ly=20 unsuited to holding an office of public trust.=20 ?????But his remarks do have one positive merit: They tell us what criminal= =20 penalties really entail.=20 ?????Contrary to some depictions of prisons as country clubs they are=20 violent and terrible places. More and more politicians propose criminal=20 sanctions for more and more alleged misdeeds and as a result ever more kin= ds=20 of behavior are sanctioned by criminal penalties perhaps now even selling= =20 electricity. Those found guilty of such crimes are put into cages where th= ey=20 are deprived of their liberty and dignity and as Lockyer so clearly=20 acknowledged raped and brutalized. What's worse Lockyer has indicated tha= t=20 he believes that rape is an appropriate part of the system of punishments h= e=20 administers.=20 ?????Should it matter that Lay is a businessman? Imagine the outcry if the= =20 head of Enron were female. What would Lockyer's fellow Democrats have said = to=20 that?=20 ?????Should it matter that Lay is chairman of an electricity generator? Doe= s=20 the nature of his business justify threats to escort him to his own rape?= =20 Lockyer told the Los Angeles Times that he had singled out Enron's chairman= =20 because the Houston-based company is the world's largest energy trader.=20 ?????So apparently singling out a man for a heinous threat is OK because he= 's=20 the chairman of the world's largest energy trading company. That's accordin= g=20 to the man who as a state senator sponsored California's 1984 hate-crimes= =20 law. Evidently the crusader against intimidation on the basis of race=20 religion and sexual orientation feels no hesitation at all about intimidati= ng=20 someone and threatening him with the brutal use of physical force simply=20 because he heads the world's largest energy trading company.=20 ?????Lockyer and Gov. Gray Davis seem to think that the best way to keep th= e=20 lights on is to threaten electricity producers with brute force rather tha= n=20 to offer to pay competitive rates in competitive markets. Are energy=20 producers to blame for California's energy problems? No. Bad policies=20 including rigid controls on retail prices of electricity are the cause of= =20 the problem not the people who generate energy. Scapegoating producers and= =20 threatening them with violence is an old ploy of authoritarians. California= ns=20 should not stand for it.=20 ?????An Enron spokesman said that Lockyer's chilling stated desire to arran= ge=20 the rape of Lay does not merit a response. The spokesman is wrong. Lockyer'= s=20 remarks merit public disgrace and removal from office. After all rape is n= ot=20 a form of legal justice in America--is it?=20 - - - Tom G. Palmer Is a Senior Fellow at the Cato Institute in Washington. E-mai= l:=20 Palmert@cato.org Copyright 2001 Los Angeles Times=20 California Metro Desk=20 U.S. Probes Alleged Pact Not to Build New Plants Power: Justice officials= =20 focus on Southland operations of two firms which deny wrongdoing. MYRON LEVIN NANCY RIVERA BROOKS ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 The U.S. Department of Justice has launched an investigation into whether t= wo=20 companies that control a large swath of Southern California 's electricity= =20 supply agreed to limit power plant construction potentially hindering=20 crucial energy production according to federal records and interviews.=20 The civil antitrust probe of Williams Energy Services and AES Southland=20 represents the Justice Department's first foray into the activities of ener= gy=20 suppliers who have reaped huge profits in California 's price-shocked marke= t.=20 AES disclosed the investigation which began last month in a filing with t= he=20 Securities and Exchange Commission on Tuesday. In its papers AES said the= =20 Justice Department is focusing on whether its agreement with Williams could= =20 constrain future power plant construction in Southern California .=20 The investigation comes at a time when the state is scrambling to get new= =20 generators built and running to avoid blackouts and economic problems.=20 The government alleges that AES and Williams agreed to limit the expansion = or=20 construction of new power plants near three facilities purchased by AES in= =20 1998 from Southern California Edison under the state's new deregulation pla= n.=20 The plants--in Long Beach Huntington Beach and Redondo Beach--are owned by= =20 AES but the electricity is sold by Williams. Under a 3-year-old deal know= n=20 as a tolling agreement Williams essentially rents out the capacity of the= =20 plants for annual payments to AES. Williams supplies natural gas to fire th= e=20 plants and sells the electricity under long-term contracts and in the costl= y=20 spot market.=20 Williams and AES have similar tolling agreements at plants in Pennsylvania= =20 and New Jersey. However AES spokesman Aaron Thomas said the Justice=20 Department's investigative requests have focused only on agreements between= =20 Williams and AES in Southern California .=20 Thomas would say only that the agreement at the center of the investigation= =20 is simply a delineation of how expansion or repowerings are done at the=20 facilities.=20 The three plants have a combined capacity of more than 3900 megawatts=20 enough to supply about 3 million homes. This summer AES is bringing anothe= r=20 450 megawatts on line by reactivating two mothballed generators in Huntingt= on=20 Beach.=20 Paula Hall-Collins a spokeswoman for Tulsa-based Williams Cos. said she= =20 believes that the investigation is unrelated to a recent inquiry by the=20 Federal Energy Regulatory Commission into whether AES and Williams=20 unnecessarily shut down plants to jack up prices. A portion of that=20 investigation was settled in April when Williams without admitting any=20 wrongdoing agreed to pay about $8 million.=20 We've always maintained that we've operated within the law and we're=20 certain the investigation by the DOJ will find we are operating legally= =20 Hall-Collins said.=20 Williams and AES are among the power plant owners and marketers that have= =20 been lambasted by Gov. Gray Davis because of gold-plated electricity prices= =20 that have pushed the state's biggest utilities to the edge of ruin and are= =20 steadily draining the state's budget surplus.=20 State officials are asking FERC to revoke the rights of AES and Williams to= =20 sell electricity at whatever price the market will bear. That right was=20 granted for three years beginning in 1998 by federal regulators when=20 California 's $28-billion electricity market was opened to competition.=20 Under that plan the rights of AES and Williams to sell into the market are= =20 the first to come up for renewal.=20 AES Southland and Williams Energy Services are both arms of large energy=20 companies--AES Corp. of Arlington Va. and Williams Cos. of Tulsa Okla. California Metro Desk=20 Natural Gas Power Prices Drop Sharply Energy: More conservation mild=20 weather are among factors keeping costs down experts say. RICARDO ALONSO-ZALDIVAR NANCY VOGEL ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 WASHINGTON -- The wholesale prices of electricity and natural gas in=20 California have fallen sharply in recent weeks and experts said Tuesday th= at=20 the relief could be the harbinger of an energy turnaround.=20 Or it may be just a blip.=20 In the last couple of weeks California power prices have plunged to the=20 lowest levels since April 2000 traders say with electricity selling on so= me=20 days for less than $100 per megawatt-hour.=20 At night when demand slackens power sometimes sells for less than $20 per= =20 megawatt-hour. That is reminiscent of the days before prices went haywire= =20 last summer.=20 It is a drastically different scenario than the $500 to $800 the state paid= =20 during a spate of hot weather last month.=20 Meanwhile wholesale natural gas prices at a bellwether pipeline junction o= n=20 the Southern California -Arizona border dipped last week to their lowest=20 levels since November according to a publication that tracks the industry.= =20 Separately Southern California Gas Co. and Pacific Gas & Electric Co.=20 reported June rate cuts for their residential gas customers of 16% and 38%= =20 respectively.=20 Experts credited a combination of conservation mild weather a burst of=20 increased hydroelectric generation and lower natural gas prices for the dro= p=20 in electricity costs.=20 Conservation is starting to worry the generators which is nice to see= =20 said Severin Borenstein director of the University of California Energy=20 Institute in Berkeley. Californians used 11% less energy last month than in= =20 May 2000 according to the state Energy Commission.=20 I'm worried that if we don't push harder on conservation [prices] won't= =20 stay down Borenstein added.=20 On the natural gas side experts said the price decline is due to replenish= ed=20 storage within California a nationwide drop in the cost of the fuel and= =20 easing demand from power plants.=20 The number of shippers competing to get natural gas to the state has also= =20 increased with the expiration of a controversial contract on the El Paso= =20 pipeline system last week.=20 But economists were reluctant to make sweeping predictions based on the=20 latest indicators.=20 It's hard to draw specific conclusions said Bruce Henning who tracks th= e=20 natural gas markets for Energy and Environmental Analysis Inc. an Arlingto= n=20 Va. consulting firm.=20 How the summer turns out depends on the weather in the state Henning said= =20 adding The weather represents the balance in the Southern California=20 market.=20 Natural gas fuels most California power plants. With wholesale prices=20 recently averaging three to four times the rates charged elsewhere in the= =20 country state and federal officials have despaired of chances for=20 controlling electricity costs.=20 Last Friday however the daily price for immediate delivery of natural gas= =20 in Topock Ariz. a pipeline junction near the California border dipped to= =20 $7.85 per million British thermal units.=20 According to Natural Gas Week it was the first time since mid-November tha= t=20 the price at that location had fallen below $8 per million BTUs. One millio= n=20 BTUs is what a typical Southern California home uses in five or six days.= =20 Considered a bellwether for other pipeline systems serving California the= =20 Topock price reached a record $56.54 per million BTUs on Dec. 8. It stood a= t=20 $9.36 per million BTUs at the close of business Tuesday still below recent= =20 weekly averages.=20 Other industry publications have also picked up signals of price declines.= =20 Platts the energy information division of McGraw-Hill Cos. reported Tuesd= ay=20 that the price for monthly gas delivery contracts to California fell 22% in= =20 June following a nationwide trend.=20 But Henning said the drop in California prices is attributable to both lowe= r=20 prices around the country and a decline in the high markups for shipping ga= s=20 to California . Those markups which far exceed the cost of transporting ga= s=20 have drawn the attention of state and federal investigators.=20 Henning said the markups are declining as depleted storage levels in=20 California are replenished. Storage levels have been filling very rapidly= =20 and that fact is reflected in prices coming down he said.=20 The link between natural gas and electricity prices is a hotly debated=20 subject. Some experts say high-priced natural gas is driving up the cost of= =20 electricity . Others believe that record prices for power are raising the= =20 prices that generators are willing to pay for their fuel.=20 Electricity prices that range from $20 to $200 per megawatt-hour--instead o= f=20 the $150 to $500 per megawatt-hour paid in recent months--are great news fo= r=20 Gov. Gray Davis.=20 Average daily power prices in California for transactions through the=20 Automated Power Exchange have dropped from $149 per megawatt-hour last Frid= ay=20 to $110 per megawatt-hour Tuesday. The exchange is a private company that= =20 brings together electricity buyers and sellers and accounts for less than 1= 0%=20 of the state's market.=20 Davis spokesman Steve Maviglio said Tuesday that average daily power=20 purchases by the state have recently dipped below $50 million.=20 The state has sometimes had to pay more than $100 million a day since it=20 started buying power in January through the Department of Water Resources.= =20 The state stepped in because California 's two biggest utilities became too= =20 financially crippled to withstand the prices being charged by generators.= =20 Davis' plan to pay for past and future energy purchases with a $12.4-billio= n=20 bond issue hinges on an assumption that power prices will be driven down th= is=20 summer through long-term contracts conservation and the construction of ne= w=20 power plants.=20 UC Berkeley's Borenstein said conservation efforts have not gone far enough= .=20 You walk into most buildings and you still need a sweater he said. That= =20 ain't the way to hit the target.=20 If Californians conserved an additional 10% off their peak usage on hot=20 afternoons he said we could really break the backs of the generators we= =20 could really collapse the price.=20 Prices tend to skyrocket in California 's electricity market on hot=20 afternoons when demand soars and grid operators must scramble to purchase= =20 enough electricity . Cool weather which reduces demand for air conditionin= g=20 and conservation help keep the state from reaching such crisis situations.= =20 Borenstein said he believes generators are also asking less money for their= =20 electricity in part because of a federal order that took effect last month.= =20 The order limits the price power plant owners can charge when California 's= =20 supplies are strained.=20 Power sellers say there are more fundamental forces at work.=20 There's more supply relative to demand which is softening prices said= =20 Gary Ackerman executive director of the Western Power Trading Forum. The= =20 market is working and it's providing cheaper wholesale power more quickly= =20 than any regulatory scheme could ever do.=20 *=20 Times staff writer Dan Morain in Sacramento contributed to this story.=20 RELATED STORY=20 PG&E wins: The utility averted a $1-billion bill for power buys. B6=20 (BEGIN TEXT OF INFOBOX / INFOGRAPHIC)=20 A Blip or a Trend?=20 Daily natural gas prices at the California border with Arizona--considered = a=20 bellwether of the state's costs--have been declining in the last two weeks.= =20 *=20 Natural gas price per 1 million Btu=20 $9.36=20 Source: Natural Gas Week California Metro Desk=20 The State Utility Averts $1 Billion in Costs Courts: PG&E and Cal-ISO agree= =20 to recognize Department of Water Resources as purchaser of the power. TIM REITERMAN ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-6=20 Copyright 2001 / The Times Mirror Company=20 SAN FRANCISCO -- Pacific Gas & Electric Co. and the state's power grid=20 operator reached an agreement Tuesday that insulated PG&E at least=20 temporarily from more than $1 billion in power purchases the state made for= =20 its customers.=20 The California Independent System Operator sent $1.26 billion in invoices t= o=20 the utility for power purchases by the state Department of Water Resources= =20 for PG&E customers from January through March.=20 But the utility contended in Bankruptcy Court proceedings that it was not= =20 liable for such purchases and that continued purchases would cause annual= =20 losses of $4 billion.=20 After arguments before Judge Dennis Montali PG&E and Cal-ISO agreed that t= he=20 Department of Water Resources not PG&E purchased the power. Cal-ISO had= =20 argued that it was making the purchases on PG&E's behalf.=20 PG&E wants to be a utility and have obligations to serve customers but th= ey=20 don't want to pay for it Cal-ISO general counsel Charles Robinson said=20 later.=20 If PG&E refuses to pay the invoices Robinson said Cal-ISO will send the= =20 bills to the Department of Water Resources and officials there can decide= =20 whether to pursue claims in Bankruptcy Court. A spokesman for department= =20 which has authorization to sell $13 billion in bonds for power purchases= =20 said the agency will have no comment until the matter can be studied.=20 State agencies have stayed out of the bankruptcy proceedings hoping to=20 preserve their immunity from suits in federal court.=20 The agreement will be submitted for Montali's approval Monday but the judg= e=20 said it would not be binding on the department because no one represented t= he=20 agency in court.=20 PG&E's own production and contracts provide the majority of the power for i= ts=20 customers. But state legislation adopted this year allows the department to= =20 secure power contracts to serve customers of ailing utilities. When a=20 shortage threatens the power grid the department purchases additional powe= r=20 through Cal-ISO on the spot electricity market.=20 PG&E filed for Chapter 11 protection from creditors on April 6 saying it w= as=20 $9 billion in debt.=20 Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited=20 David Lazarus Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 California electricity prices have plunged unexpectedly to their lowest lev= el=20 in more than a year partly as the result of a simultaneous drop in prices= =20 for natural gas which fuels most power plants.=20 Make no mistake: Gas and electricity prices could surge upward again in=20 months ahead.=20 But for the first time since California's energy markets went haywire last= =20 summer industry experts are beginning to ask whether the state finally may= =20 have turned a corner in its battle with runaway power costs.=20 California is not yet out of the woods said Kelley Doolan who tracks=20 natural gas prices for energy market researcher Platts. But this is a very= =20 significant decrease in costs.=20 Along with lower gas prices the decline in electricity costs was attribute= d=20 by state and industry officials to milder weather which reduces demand for= =20 power. They also credited recent conservation efforts by consumers and=20 better-than-expected runoff at dams for hydroelectric plants.=20 Gary Ackerman executive director of the Western Power Trading Forum an=20 energy-industry association said these factors came together to produce th= e=20 lowest wholesale electricity prices since April 2000.=20 Electricity on the spot market could have been purchased yesterday for as= =20 little as $50 per megawatt hour he noted compared with more than $500=20 earlier this year.=20 If the weather stays this way we could have reasonable prices all summer= =20 Ackerman said. We may also have fewer blackouts.=20 It is tempting for Californians to be suspicious of virtually any swing in= =20 energy prices. If power companies manipulated prices on the way up as=20 critics have alleged might they not be up to some trick as prices head in= =20 the opposite direction?=20 Nettie Hoge executive director of The Utility Reform Network in San=20 Francisco speculated that generators are allowing electricity prices to fa= ll=20 so they can discourage federal regulators from taking a more active role in= =20 the dysfunctional California market.=20 They're trying to take the heat off she said.=20 Others cautioned that the lower prices may be nothing more than a statistic= al=20 blip.=20 This was just one month's decline said Michael Shames executive directo= r=20 of the Utility Consumers' Action Network in San Diego. We really have to s= ee=20 how this plays out in the future.=20 Steve Maviglio a spokesman for Gov. Gray Davis said the governor was very= =20 encouraged by the lower energy prices. Davis announced Sunday that=20 California's power use was down 11 percent last month from a year before.= =20 We're not there yet Maviglio said of whether an end to the state's power= =20 woes is in sight. But the trend is pointing in the right direction.=20 WHITE ELEPHANT Yet this sudden drop in energy prices does have a dark side: California cou= ld=20 end up with a huge white elephant after spending about $40 billion in publi= c=20 funds on long-term power contracts.=20 The logic behind the contracts which are at an average price of $69 per=20 megawatt hour over 10 years is that the state expected to pay below-market= =20 rates for electricity for a number of years before prices came down and=20 California found itself paying above-market rates.=20 If current trends continue though California will find itself paying=20 consistently above-market rates much sooner than expected making the long-= =20 term contracts a sweet deal for the same power companies that profited so= =20 handsomely during the state's darkest hours.=20 The contracts look really ugly right now said Shames at the Utility=20 Consumers' Action Network. They may be way overpriced.=20 Maviglio the governor's spokesman said it is too early to conclude that t= he=20 state did poorly negotiating dozens of long-term power contracts.=20 No one has a crystal ball on this he said.=20 CUSTOMERS' BILLS TO DROP In any case Pacific Gas and Electric Co. said yesterday that customers'=20 average gas bills will drop 26 percent this month to $26 and should stay ne= ar=20 that level all summer.=20 Platts which monitors average monthly spot prices found that the wholesal= e=20 price of gas at the California-Oregon border has tumbled nearly 42 percent= =20 since the beginning of May -- from $9.98 per million British thermal units = to=20 $5.81.=20 The wholesale gas price at the California-Arizona border fell 45 percent= =20 from $11.91 to $6.50. This compares with a 25 percent monthly decline in=20 average natural gas prices nationwide.=20 However California gas prices are still about 50 percent higher than they= =20 were a year ago whereas national prices are now below year-ago levels for= =20 the first time since last spring.=20 While cooler weather nationwide helped push gas prices down overall Doolan= =20 attributed the especially steep drop in California to a commensurate surge = in=20 prices last month related to fears of a long hot summer of rolling=20 blackouts.=20 You had state officials all but promising rolling blackouts this summer = he=20 said. That created enormous demand for electricity generation.=20 What has changed is that we've had weeks of mild weather Doolan observed= .=20 The electricity generators have not come out of the woodwork buying up all= =20 the gas.=20 This allowed utilities like PG&E to beef up gas inventories which eased=20 demand and resulted in substantially lower prices he said.=20 'BACK ON TRACK'=20 We're back on track to be completely full for winter said Staci Homrig = a=20 PG&E spokeswoman. That's a very good thing.=20 Gas prices historically dip in the spring and summer and then rise again in= =20 the winter. PG&E is forecasting that customers' average gas bills could ris= e=20 to as high as $75 in December if current trends continue.=20 However the precipitous drop in gas prices in recent weeks suggests that= =20 California's unusually high costs at last may be abating.=20 Individual power companies so far are reluctant to speculate on whether the= =20 drop in gas prices will have a lasting effect on electricity costs.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 San Jose council gives green light to generating plant=20 VOTE REVERSAL: Officials pressured to OK project=20 Marshall Wilson Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 In a clear sign that the political landscape has shifted because of the=20 state's power crisis the San Jose City Council gave a green light yesterda= y=20 for construction of a generating plant it had unanimously opposed in=20 November.=20 Yesterday's 10-to-1 vote came after months of mounting pressure for the cit= y=20 to reverse course and approve the controversial 600-megawatt Calpine plant = at=20 Coyote Valley.=20 That pressure -- increased by the occasional rolling blackout -- has come= =20 from nearly every corner of the state from elected officials to high-tech= =20 businesses and labor unions worried the power crisis will drain away jobs= =20 ruin the economy and lead to voter backlash over skyrocketing energy bills.= =20 Even the local branch of the NAACP and environmentalists pushed the council= =20 to approve the Calpine proposal -- despite overwhelming opposition from the= =20 plant's neighbors.=20 Council members did not hide their disdain yesterday for being forced to=20 reconsider their opposition to the so-called Metcalf Energy Center.=20 I'm holding my nose to vote for this thing said Councilwoman Linda=20 LeZotte.=20 I'm just as unhappy as everybody else Vice Mayor George Shirakawa said. = I=20 feel like no matter what happens we can't win.=20 GOVERNOR OFFERED HIS SUPPORT After the council's solid opposition in November Calpine appealed to the= =20 California Energy Commission which has the final say. The controversial=20 plant then received a huge boost in April when Gov. Gray Davis threw his=20 support behind it.=20 San Jose officials conceded yesterday that the energy commission was likely= =20 to override their opposition and grant approval within a few weeks. They sa= id=20 the commission's likely approval was stripping them of their power to decid= e=20 local land-use issues.=20 What I think has happened . . . is the governor and the Legislature at the= =20 state level have taken this out of our hands said Councilwoman Pat Dando.= =20 I don't think there's any chance at all the California Energy Commission i= s=20 going to turn down the Metcalf Energy Center Councilman Chuck Reed said.= =20 CONSTRUCTION MAY BEGIN SOON If given the go-ahead by the state Calpine could begin construction as ear= ly=20 as next month. The natural-gas fired plant would generate electricity by=20 mid-2003 company spokesman Kenneth Arbeu said.=20 At the urging of Mayor Ron Gonzales the council yesterday approved a new= =20 cooperation agreement with Calpine. The vote with Councilman Forrest=20 Williams casting the lone nay is preliminary while a final vote that is=20 scheduled for June 26.=20 Gonzales argued that the agreement did not amount to a flip-flop because it= =20 differs from what Calpine proposed in November.=20 The agreement approved by the council calls for increased monitoring of air= =20 pollution the use of treated wastewater to cool the plant which will redu= ce=20 discharges into San Francisco Bay and a $6.5 million community benefits= =20 package with the bulk going toward parkland acquisition Gonzales said.=20 This council has not changed its decision he said. What we've done is= =20 change the facility.=20 Critics incensed that the city was buckling to outside pressure vowed to= =20 change the council at the next election.=20 CONCERNS OVER HEALTH RISKS They raised concerns that boiled wastewater steam wafting over their homes= =20 from Calpine's plant could pose health risks. Jona Denz-Hamilton said more= =20 controls are needed to ensure the safety of neighbors like herself and her= =20 family and argued that new cleaner-burning technologies should be installe= d=20 at the plant.=20 It's too great of a risk she said.=20 Other critics said the state's energy woes will be solved and largely=20 forgotten by the time the plant opens in two years while the Santa Teresa= =20 neighborhood will be stuck with pollution for decades.=20 Approval seemed a given at the start of the more than three-hour hearing.= =20 Much of the afternoon's debate focused around plans to extend a pipeline fo= r=20 treated wastewater to the new plant.=20 Critics said Calpine was receiving a sweet deal by paying only $10 million = of=20 the $50 million cost of extending the pipeline. Several council members ask= ed=20 for a more detailed report into the financing plan before the final vote is= =20 taken June 26.=20 Chronicle staff writer Bill Workman contributed to this report.=20 E-mail Marshall Wilson at 2001 San Francisco Chronicle ? Page?A - 1=20 Developments in California's energy crisis=20 Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate1 053EDT0177.DTL=20 (06-06) 07:53 PDT (AP) --=20 Developments in California's energy crisis:=20 WEDNESDAY: * No power alerts Wednesday as reserves stay above 7 percent.=20 TUESDAY: * Gov. Gray Davis' administration says the state's electricity costs are=20 dropping substantially even as it asks state legislators for another=20 half-billion dollars for power purchases. That brings to $8.2 billion the= =20 amount the state is paying for electricity on behalf of three financially= =20 strapped utilities.=20 Spokesman Steve Maviglio says the cost to the state treasury has dropped in= =20 the last few weeks well below the $50 million dollars the state had been=20 paying on a typical day. He credits cooler weather conservation more powe= r=20 plants online and more long-term contracts with helping drive down the cost= .=20 * A state Senate committee agrees to issue subpoenas to eight out-of-state= =20 electricity generators demanding they hand over documents on bidding prici= ng=20 and other aspects of power sales in the state. The subpoenas would help a= =20 special Senate committee's investigation into whether the companies are=20 illegally profiteering from California's power crisis. The committee's=20 chairman says he expects the companies to resist setting the stage for a= =20 court battle.=20 * Oil giant Chevron threatens to cut gasoline production in California unle= ss=20 it is exempted from rolling blackouts. The San Francisco Chronicle says it= =20 has a copy of a letter sent Friday from Chevron chairman David O'Reilly to= =20 Davis. In the letter O'Reilly says the company will scale back gasoline=20 production at its Richmond and El Segundo plants operating those refinerie= s=20 only with power produced by generators at the sites.=20 * New U.S. Senate Majority Leader Tom Daschle D-S.D. supports Federal=20 Energy Regulatory Commission price caps. FERC must meet its obligation und= er=20 current law to ensure 'just and reasonable' prices for wholesale electricit= y=20 in the state of California. FERC has failed to meet this responsibility...= =20 Daschle says in a letter to Davis. Unless FERC acts soon Senator (Dianne)= =20 Feinstein's legislation should be taken up and passed to direct FERC to tak= e=20 action. I will support all necessary efforts to meet that goal.=20 * House Subcommittee on Energy Policy Natural Resources and Regulatory=20 Affairs Chairman Doug Ose R-Sacramento cites Electric Utility Week figure= s=20 that FERC's limited price caps helped cut California's power rates from $30= 0=20 to $108.47 per megawatt hour within an hour after taking effect last week.= =20 While he says more information is needed Ose uses the figures to tout his= =20 pending bill to impose the price caps around the clock and to all Western= =20 states.=20 * Pacific Gas & Electric Co. asks U.S. Bankruptcy Judge Dennis Montali to= =20 stop the manager of the state's power grid from buying electricity for=20 utility or charging it for any electricity bought after the utility filed f= or=20 bankruptcy on April 6. Separately the utility's creditors support its=20 request to the bankruptcy court to pay out $17.5 million in bonuses to the= =20 management team that guided the utility into bankruptcy.=20 * California Department of Water Resources reveals it is negotiating with= =20 municipal utilities to buy their surplus power. Department spokesman Oscar= =20 Hidalgo says talks began last week but no agreements are imminent.=20 * State lawmakers criticize a $3 million lobbying campaign by Southern=20 California Edison. The utility is telephoning shareholders to describe the= =20 dire consequences if the utility goes bankrupt. The call is then transferre= d=20 to the state Capitol so shareholders can implore lawmakers to support a=20 controversial plan to help the utility. Legislators and their staffers say= =20 the shareholders often are confused and scared their investments will be=20 degraded or wiped out.=20 * State Treasurer Phil Angelides joins an advocacy group for the poor in=20 urging the state's huge pension funds to use their economic power to levera= ge=20 power companies. The Pacific Institute for Community Organization says the= =20 two pension funds own at least $1.2 billion in stocks and bonds in most of= =20 the firms that sell electricity to California.=20 * The Assembly by a 69-0 vote approves a bill to spend $10 million on=20 environmental studies needed before Path 15 the inadequate transmission-li= ne=20 group between Northern and Southern California can be expanded. The bill= =20 moves to the Senate.=20 * Pacific Gas and Electric announces a decrease in natural gas prices down= =20 38 percent from May's rates and 66 percent lower than January's rates. The= =20 decline will bring the average residential gas bill to $26 when it goes int= o=20 effect June 7. Market analysts predict the rates will remain stable until= =20 December when demand is expected to increase with winter heating loads.=20 * No power alerts Tuesday as electricity reserves stay above 7 percent.=20 * Shares of Edison International closed at $10.05 down 53 cents. PG&E Corp= .=20 closed at $11.25 down 15 cents. Sempra Energy the parent company of San= =20 Diego Gas & Electric closes at $26.91 down 43 cents.=20 WHAT'S NEXT: * Davis' representatives continue negotiating with Sempra the parent compa= ny=20 of San Diego Gas and Electric Co. to buy the utility's transmission lines.= =20 THE PROBLEM: High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Edison and PG&E say they've lost nearly $14 billion since June to high=20 wholesale prices the state's electricity deregulation law bars them from=20 passing on to consumers. PG&E saying it hasn't received the help it needs= =20 from regulators or state lawmakers filed for federal bankruptcy protection= =20 April 6.=20 Electricity and natural gas suppliers scared off by the two companies' poo= r=20 credit ratings are refusing to sell to them leading the state in January = to=20 start buying power for the utilities' nearly 9 million residential and=20 business customers. The state is also buying power for a third investor-own= ed=20 utility San Diego Gas & Electric which is in better financial shape than= =20 much larger Edison and PG&E but also struggling with high wholesale power= =20 costs.=20 The Public Utilities Commission has approved average rate increases of 37= =20 percent for the heaviest residential customers and 38 percent for commercia= l=20 customers and hikes of up to 49 percent for industrial customers and 15=20 percent or 20 percent for agricultural customers to help finance the state'= s=20 multibillion-dollar power buys.=20 2001 Associated Press ?=20 California conserves=20 Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/E D86597.DTL=20 WHEN RAIN fails to fall from the sky Californians know why there is a=20 drought. But when rolling blackouts suddenly appeared in the dead of winter= =20 many of us wondered who was responsible for and who has profited from what= =20 now seems like an artificially created power shortage in the state.=20 Our skepticism proved to be right. Windfall profits were reaped by=20 electricity generators while natural gas importers extracted prices far abo= ve=20 the national average.=20 Timid federal overseers exact only wrist-slap penalties on the offending=20 energy firms. The White House scoffs at temporary controls for a=20 malfunctioning market. California's state government has ended up as the bi= ll=20 payer for the sickly utilities forking over $8 billion to generators. This= =20 number may hit $40 billion by year-end.=20 It's an infuriating tangle. All the more remarkable then that skeptical= =20 Californians have managed within two months to reduce their use of=20 electricity by 11 percent. The public's response to the governor's appeal f= or=20 energy conservation has exceeded expectations. Although many businesses hav= e=20 suffered enormous losses ordinary people have made relatively painless=20 sacrifices. People turned off their lights purchased energy-efficient=20 lightbulbs used air conditioning less and shut off their computers when no= t=20 in use.=20 Despite this remarkable civic compliance we still face an unconscionable= =20 lack of leadership. President Bush seems perfectly willing to allow Texas= =20 power companies to pummel the once-powerful California economy. He repeats = a=20 mantra about creating more supply -- which California is doing with 15 powe= r=20 plants under construction -- while ignoring the outsized sums paid to a=20 handful of energy generators.=20 At the same time Gov. Gray Davis who has given new meaning to the word=20 dithering has failed to make the tough and transparent decisions. He delay= ed=20 an inevitable rise in power rates. Davis also dragged his feet in openly=20 announcing new power contracts that commit California to billions in spendi= ng=20 over the next decade.=20 To Davis' credit he has urged California to conserve by laying out an $800= =20 million plan to cut power use and invest in energy-saving programs. The=20 message is getting out as higher rates take effect this month.=20 Despite a woefully unbalanced market and shortsighted leadership the peopl= e=20 of California have demonstrated that if there is a will there is a way.=20 Now it is time for our leaders to follow the wisdom of their constituents.= =20 2001 San Francisco Chronicle ? Page?A - 20=20 L.A. power customers awash in cheap energy=20 John Wildermuth Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/M N133438.DTL=20 Los Angeles -- These are flush times for the city's Department of Water and= =20 Power and the energy executives are loving every minute of it.=20 As are their customers.=20 Private power companies throughout California have been raising rates and= =20 warning customers about a long hot summer filled with blackouts but the= =20 city- owned DWP has been keeping prices stable and the lights on for 1.2=20 million Los Angeles customers.=20 Our customers are being really nice to us said Angelina Galiteva the=20 utility's strategic planning director. They love the DWP.=20 Although Gov. Gray Davis' administration announced that the state had reduc= ed=20 its energy consumption 11 percent from a year ago those in Los Angeles had= =20 cut back less than half that -- and polls show they view the energy situati= on=20 less seriously than other Californians.=20 Public utilities such as Los Angeles water and power have seen their revenu= es=20 increase during the energy crunch because they can sell their excess power = at=20 higher prices than ever before in a market tilted toward sellers.=20 The rest of the state doesn't always feel that same warm glow. Davis has=20 accused the DWP and other California public utilities of putting exorbitant= =20 price tags on the excess electricity they sell to the rest of the energy-= =20 starved state.=20 It's a charge Los Angeles utility executives deny arguing that their exces= s=20 power is sold at cost plus 15 percent which they say is a fair return for= =20 their customers.=20 Without our support a million more homes (elsewhere in California) would= =20 have suffered rolling blackouts which is a powerful message Galiteva sai= d.=20 It wasn't supposed to be this way. When the power industry was deregulated = in=20 the late '90s energy giants like Pacific Gas and Electric Co. and Southern= =20 California Edison were expected to be the big winners. Now PG&E is in=20 bankruptcy and Edison is a short step away.=20 When deregulation came the experts said that the investor-owned utilities= =20 would become lean mean machines that would be better able to operate in th= e=20 new environment Galiteva said. But now public power has shown it can ser= ve=20 customers more efficiently at lower rates.=20 While much of the state worries about electrical supply Los Angeles=20 residents have been saved many of those concerns.=20 In a survey done last month by the Public Policy Institute of California 4= 8=20 percent of the people in the Bay Area thought that electricity cost and=20 availability were the most important issues facing the state. In Los Angele= s=20 however only 33 percent put the energy crunch on top. When questioned abou= t=20 the size of the power problem and the effect it would have on the state's= =20 economy Los Angeles residents were consistently less concerned than people= =20 elsewhere in California.=20 People in Los Angeles have been somewhat isolated from the energy crisis= =20 concluded Mark Baldassare who conducted the survey.=20 That doesn't mean the state's energy problems haven't had an effect. The DW= P=20 has seen a 3 percent to 5 percent reduction in some uses which officials= =20 have dubbed sympathy conservation. The utility also is offering its bigge= st=20 customers financial incentives to cut back on their power use.=20 Our average annual load growth is about 80 megawatts Galiteva said. By= =20 this summer we expect to have saved 40 megawatts through conservation. By= =20 December we expect 60 megawatts in savings.=20 The utility also is making a major attempt to create a conservation ethic= =20 among its customers. DWP's comfortable situation has made it possible to=20 offer them the carrot without the need to show them the stick.=20 Conservation no longer means doing without Galiteva said. Beer can be= =20 just as cold with a superefficient refrigerator. Rooms can be just as brigh= t=20 with superefficient light bulbs.=20 A Green Power program also is promoting the use of renewable energy=20 resources such as solar wind and hydroelectric power. About 75000 custome= rs=20 are paying an extra $3 per month to increase DWP's use of renewable power= =20 sources.=20 We're trying to give our customers a choice and a voice in determining the= =20 mix of power they use Galiteva said. They know they can do (conservation= )=20 now or see it being mandated later.=20 Los Angeles power officials -- and their customers -- know the DWP isn't=20 always going to continue as an island of tranquility in a sea of energy=20 turmoil. The utility's aging gas-fired plants have been affected by the=20 rising price of natural gas. Demand for energy continues to rise. In a deba= te=20 last month both candidates for mayor of Los Angeles agreed that increases = in=20 local power bills are inevitable.=20 But the DWP has been supplying power to Los Angeles since 1916 and its=20 executives believe that the state's deregulation disaster has shown the=20 advantages of the city-owned utility.=20 It's nice to be the lean mean green efficient machine that no one ever= =20 expected us to become Galiteva said.=20 E-mail John Wildermuth at 2001 San Francisco Chronicle ? Page?A - 13=20 PG&E doesn't want to pay for energy to avert blackouts=20 DAVID KRAVETS Associated Press Writer Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate0 306EDT0102.DTL=20 (06-06) 00:06 PDT SAN FRANCISCO (AP) --=20 Pacific Gas & Electric Co. has told a bankruptcy judge it should not have t= o=20 pay for what could amount to billions of dollars in spot-market energy cost= s=20 to avert blackouts.=20 The company's position was one of two developments that emerged Tuesday as= =20 the bankrupt utility tries to cope with fallout from California's power=20 crisis. The other development saw a group of creditors that PG&E owes=20 billions endorse $17.5 million in bonuses for top managers at the utility.= =20 San Francisco-based PG&E filed for bankruptcy protection in April after=20 racking up an $8.9 billion debt which under state law it could not recoup= =20 from customers.=20 Tuesday's court dispute centered on who pays for energy bought at the last= =20 minute to avoid blackouts.=20 PG&E said an April federal regulatory decision requires that electricity ca= n=20 only be sold to those with the ability to pay electricity generators. The= =20 state is the only player with such ability said PG&E attorney Jerome Faulk= =20 who argued that the utility shouldn't have to pay the $330 million in month= ly=20 spot-market energy bills.=20 Judge Dennis Montali said he may craft such an order. But he said the order= =20 would not preclude the state from suing PG&E to recover the cost.=20 In a separate but related development a committee charged with devising a= =20 payment plan for those creditors owed billions by PG&E said it will sign of= f=20 on the utility's plan to pay $17.5 million in bonuses to PG&E's management= =20 team.=20 Attorney Allan Marks who represents the committee said such payments are= =20 normal during large bankruptcy cases. Under the agreement which Montali wi= ll=20 consider at a June 18 hearing the company must quickly produce a debt=20 payment plan that passes judicial muster.=20 The utility said it needs the bonuses for a management retention program.= =20 Marks agreed. While the $17.5 million leaves less for creditors without a= =20 financial incentive PG&E's key top brass may not be willing to cooperate wi= th=20 a payment plan Marks said.=20 The main goal for the creditors' support here is to move the bankruptcy as= =20 quickly and smoothly as possible Marks said.=20 The Utility Reform Network a consumer watchdog group says PG&E is simply= =20 rewarding managers of a failed business effort.=20 They're just showering money on the same people who got them in this mess= =20 said TURN's Mike Florio.=20 The proposed bonuses would come on top of $50 million in bonuses and raises= =20 PG&E awarded just before the April 6 bankruptcy filing.=20 The case is In Re Pacific Gas & Electric Co. 01-30923 DM.=20 2001 Associated Press ?=20 Metcalf plant gets preliminary approval=20 Posted at 12:21 a.m. PDT Wednesday June 6 2001=20 BY MIKE ZAPLER=20 Mercury News=20 As the San Jose City Council approached its 10-1 vote Tuesday to give an=20 initial nod to Calpine's big power plant in South San Jose Councilwoman=20 Linda LeZotte perhaps captured the body's mood best.=20 ``I'm holding my nose to vote for this thing'' she said. ``Without faultin= g=20 the mayor or his staff quite frankly I think this deal stinks.''=20 Caught in what some members called a bind beyond their control the council= =20 gave preliminary approval to an agreement negotiated by Mayor Ron Gonzales= =20 and Calpine on the company's proposed 600-megawatt Metcalf Energy Center.= =20 Councilman Forrest Williams who represents the Santa Teresa neighborhood= =20 near the site cast the lone vote against the deal.=20 The agreement is scheduled to come back before the council for a final vote= =20 on June 26 but Tuesday's vote effectively shifts the battle to the courts= =20 where residents are expected to lodge a lawsuit in one final attempt to blo= ck=20 the plant.=20 Still Councilwoman Pat Dando and some of her colleagues raised questions= =20 about the deal they said they want answered before the final vote. Their=20 issues could be incorporated into the final deal.=20 Many of the concerns focused on a $50 million recycled water pipeline=20 Gonzales agreed to have the city build to accommodate the project $10=20 million of which would be reimbursed by Calpine over 30 years.=20 Pipeline possibility=20 Dando said that a private company Great Oaks Water may be willing to buil= d=20 the pipeline extension itself saving the city the $50 million expense.=20 Officials at Great Oaks were unavailable Tuesday.=20 Council members peppered staff with other questions. Many were alarmed by= =20 claims of the Silicon Valley Toxics Coalition which said that using treate= d=20 sewage water to cool the power plant could allow dangerous chemicals to see= p=20 into drinking water aquifers. An environmental services director said the= =20 recycled water meets federal specifications but that there is no protocol= =20 for testing other chemicals not included in those standards.=20 Councilman Ken Yeager asked why Calpine should be allowed to spread a $3.9= =20 million water connection fee over 10 years -- an arrangement that would=20 mandate an amendment to city law.=20 LeZotte meanwhile said she wants to hold Calpine accountable to install= =20 ammonia-free technology at the plant. Ammonia is highly hazardous and=20 residents say the use of the chemical to clean the plant is among their chi= ef=20 concerns.=20 The agreement requires the company to install technology to reduce or=20 eliminate the use ammonia when it becomes ``technologically and economicall= y=20 feasible.'' LeZotte said she wants a clear definition of ``feasible''=20 included in the deal.=20 Tuesday's vote marked a stark departure from the council's November vote to= =20 deny Metcalf. At the time council members said a power plant was=20 inappropriate for the area and many members said Tuesday that they still= =20 believe that.=20 Bowing to pressure=20 But with Gov. Gray Davis endorsing Metcalf in April and the California Ener= gy=20 Commission widely expected to override the city's denial this month counci= l=20 members said they had no choice but to cut the best deal it could and allow= =20 the project to proceed.=20 That explanation however didn't sit well with residents of the Santa Tere= sa=20 neighborhood adjacent to the Metcalf site one of whom accused Gonzales and= =20 the council of ``switching sides when the opposing team gets too close to t= he=20 goal line.''=20 Contact Mike Zapler at mzapler@sjmercury.com or at (408) 275-0140.=20 Feds probe AES Williams=20 Antitrust investigation looks into allegations of manipulated energy prices= =20 through reduced power-plant construction.=20 June 6 2001=20 By JAMES ROWLEY Bloomberg News=20 WASHINGTON - The U.S. Justice Department opened an antitrust investigation= =20 into California's electricity shortage by probing allegations that AES Corp= .=20 and Williams Energy Services Co. are limiting power-plant expansion to driv= e=20 up prices.=20 AES Corp. the biggest U.S. power-plant developer disclosed the=20 investigation in a filing with the U.S. Securities and Exchange Commission.= =20 The Justice Department is looking into a supply-and-marketing agreement=20 between AES' California power-plant unit and a Williams unit that supplies= =20 natural gas.=20 Williams owner of the second-largest U.S. natural-gas pipeline system als= o=20 markets the power produced by AES' three electricity plants in the state.= =20 The department alleges the agreement limits expansion of generating capacit= y=20 near some AES plants.=20 AES said it was cooperating with the Justice Department investigation whic= h=20 began last month into possible violations of Section 1 of the Sherman=20 Antitrust Act.=20 That provision outlaws any restraint of trade that stifles competition.=20 A shortage of generating capacity in California has led to soaring wholesal= e=20 prices and rolling blackouts and prompted Pacific Gas & Electric the state= 's=20 largest utility to seek bankruptcy protection in April.=20 Aaron Thomas a spokesman for AES based in Arlington Va. said the U.S.= =20 investigation started no more than a couple of weeks ago.=20 Williams spokeswoman Paula Hall-Collins said the Tulsa Okla.-based company= =20 is cooperating.=20 Gina Talamona Justice Department spokeswoman said the agency had no=20 immediate comment.=20 The investigation was opened several weeks after the Federal Energy=20 Regulatory Commission investigated AES plants in Long Beach and Huntington= =20 Beach designated must run under the Federal Power Act did not produce= =20 electricity for 10 days in April and May 2000. Williams agreed to pay the= =20 operator of California's electric grid $8 million to settle allegations tha= t=20 it overcharged for power.=20 FERC charged in March that the companies had a financial incentive to keep= =20 the units out of service to force the California Independent System Operato= r=20 to buy power from AES' plant in Redondo Beach at prices close to the=20 FERC-imposed cap of $750 per megawatt-hour.=20 AES said it was complying with a Justice Department demand for documents=20 about the agreement between its AES Southland LLC unit and Williams Energy= =20 Services Co. AES Southland which operates the three power plants was also= =20 asked to respond to interrogatories the company said.=20 The Williams unit supplies the natural gas to fuel the AES plants and marke= ts=20 the power they produce.=20 AES and Williams jointly produce and sell about 4000 megawatts in Californ= ia=20 -- 6 to 8 percent of the state's power -- enough electricity to light about= 3=20 million typical California homes.=20 AES shares dropped $2.05 to $42.54. Williams Cos. shares dropped $1 to=20 $38.20. Calpine Begins Construction of Peaking Energy Center in Gilroy Calif.=20 June 6 2001=20 SAN JOSE Calif. June 5 /PRNewswire/ via NewsEdge Corporation -=20 Calpine Corporation (NYSE: CPN) the San Jose Calif.-based independent pow= er=20 company today announced that initial construction of 135 megawatts (mw) of= =20 peaking generation capacity will begin during this week adjacent to its=20 existing Gilroy Power Plant in Gilroy Calif. Through an Application for=20 Certification (AFC) filed with the California Energy Commission (CEC) on=20 April 25 2001 Calpine proposed to add three 45-mw simple-cycle gas turbin= e=20 peaking units in the first of a two-phase process. The California Energy=20 Commission approved the project on May 21 2001.=20 Because the required natural gas water and transmission infrastructure=20 exists at our Gilroy plant it is an ideal site for the addition of peaking= =20 generation allowing for rapid installation of needed capacity. The first= =20 three units are expected to begin generating electricity this September= =20 commented Bryan Bertacchi Calpine Vice President - Western Region.=20 Upon completion the two-phase build out the Gilroy Energy Center will be a= =20 270-mw natural gas-fired simple-cycle peaking generation facility located= =20 on approximately 9.5 acres at 1400 Pacheco Pass Highway in Gilroy. Commerci= al=20 operation of Phase One is scheduled for September 2001. An additional three= =20 45-mw gas turbine generators will be installed in Phase Two with full=20 build-out estimated for May 2002. Phase Two requires the filing of an=20 additional application with the CEC and is subject to a four-month review= =20 process.=20 Initial construction will begin this week with site and civil engineering= =20 activities occurring for approximately six weeks at which time the site wil= l=20 be cleared and leveled. Foundation work and the installation of generation= =20 equipment will follow shortly thereafter and commissioning and testing wil= l=20 take place for a two to three week period prior to commercial operation in= =20 September 2001.=20 The Gilroy Energy Center web site has been created to host all information= =20 and updates related to this project. For additional information please vis= it=20 www.gilroypower.com.=20 Calpine Corporation based in San Jose Calif. is dedicated to providing= =20 customers with reliable and competitively priced electricity. Calpine is=20 focused on clean efficient natural gas-fired generation and is the world'= s=20 largest producer of renewable geothermal energy. Calpine has launched the= =20 largest power development program in North America. To date the company ha= s=20 approximately 32200 megawatts of base load capacity and 7200 megawatts of= =20 peaking capacity in operation under construction pending acquisitions and= =20 in announced development in 29 states and Canada. The company was founded i= n=20 1984 and is publicly traded on the New York Stock Exchange under the symbol= =20 CPN. For more information about Calpine visit its Website at=20 www.calpine.com.=20 This news release discusses certain matters that may be considered=20 forward-looking statements within the meaning of Section 27A of the=20 Securities Act of 1933 as amended and Section 21E of the Securities=20 Exchange Act of 1934 as amended including statements regarding the intent= =20 belief or current expectations of Calpine Corporation (the Company) and i= ts=20 management. Prospective investors are cautioned that any such forward-looki= ng=20 statements are not guarantees of future performance and involve a number of= =20 risks and uncertainties that could materially affect actual results such as= =20 but not limited to (i) changes in government regulations including pendin= g=20 changes in California and anticipated deregulation of the electric energy= =20 industry (ii) commercial operations of new plants that may be delayed or= =20 prevented because of various development and construction risks such as a= =20 failure to obtain financing and the necessary permits to operate or the=20 failure of third-party contractors to perform their contractual obligations= =20 (iii) cost estimates are preliminary and actual cost may be higher than=20 estimated (iv) the assurance that the Company will develop additional=20 plants (v) a competitor's development of a lower-cost generating gas-fired= =20 power plant and (vi) the risks associated with marketing and selling power= =20 from power plants in the newly competitive energy market. Prospective=20 investors are also cautioned that the California energy environment remains= =20 uncertain. The Company's management is working closely with a number of=20 parties to resolve the current uncertainty while protecting the Company's= =20 interests. Management believes that a final resolution will not have a=20 material adverse impact on the Company. Prospective investors are also=20 referred to the other risks identified from time to time in the Company's= =20 reports and registration statements filed with the Securities and Exchange= =20 Commission.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Calpine Corporation=20 CONTACT: media Lisa Poelle ext. 1285 or investors Rick Barraza ext.=20 1125 both of Calpine Corporation 408-995-5115=20 Web site: http://www.gilroypower.com=20 Web site: http://www.calpine.com (CPN)=20 Reliant Urges FERC to Drop or Amend California Price Caps to Avoid Addition= al=20 Shortages and More Blackouts=20 June 6 2001=20 HOUSTON June 5 /PRNewswire/ via NewsEdge Corporation -=20 Reliant Energy (NYSE: REI) filed an emergency motion with the Federal Energ= y=20 Regulatory Commission (FERC) on Monday urging the agency to drop the=20 California price caps first applied May 29 or at a minimum amend them to= =20 reflect the true costs they are attempting to control. The current price=20 caps which send inaccurate market signals are actually decreasing supply= =20 and increasing demand thus worsening an already dire situation.=20 FERC has been publicly dedicated to an open market from the beginning of t= he=20 California power crisis. We encourage FERC to reexamine these price caps an= d=20 continue that dedication said Joe Bob Perkins president and chief=20 operating officer Reliant Energy Wholesale Group. Reliant is committed to= =20 helping keep the lights on in California this summer and wants to ensure th= at=20 if caps must remain part of the picture they actually help increase supply= =20 and fix the problem.=20 Although the price caps were first imposed less than a week ago they have= =20 already begun to damage the market by decreasing supply. The price caps are= =20 creating a myriad of problems:=20 -- Creates Misleading Signals - The price cap methodology is misleading=20 the public on the actual cost of power. Reported dispatch costs in=20 Southern California during emergencies is far below what the actual=20 financial settlements will be under the FERC's final market mitigation=20 order. This confusion results from the proxy price used for=20 dispatch utilizing an extremely distorted blended fuel cost index.=20 This index averages gas costs in northern and southern parts of the=20 state an impossibility in the actual market. This authorizes the=20 California Independent System Operator (ISO) to require that=20 generators dispatch power at reported market clearing prices well=20 below actual cost when back-up generation capacity begins to dip below=20 7.5 percent.=20 -- Depletes Power from Peaking Plants - The price caps distort dispatch=20 signals on peaking plants which in some cases may be run only a few=20 days of the year because of emission regulations. The current FERC=20 price controls encourage the ISO to purchase power from emergency=20 peaking plants before it is really needed even in the absence of a=20 stage three emergency. This depletes supplies that will by law run=20 out when blackout season intensifies later this summer. This power=20 from peaking units should only be purchased when blackouts are=20 imminent -- not in stage one or two emergencies.=20 -- Eliminates Price Signals for Retail Customers - Price caps remove=20 price signals for retail customers. Customers particularly=20 industrial companies which should be encouraged to curtail during=20 shortages are not encouraged to conserve power when dispatched price=20 caps keep prices below the actual cost to produce electricity.=20 -- Discourages Supply from Out-of-State - Suppliers outside of=20 California who are under no legal obligation to dispatch power during=20 an emergency in the state are not encouraged to increase available=20 production when reported market clearing prices are below their cost=20 to produce. During times of emergencies utilities across the Western=20 region are not likely to take on additional risks and costs if they=20 don't believe they will be fully compensated - a situation the current=20 price caps create.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Reliant Energy=20 CONTACT: Maxine Enciso of Ketchum Public Relations Los Angeles=20 310-444-1303 for Reliant Energy or media Richard Wheatley of Reliant=20 Energy 713-207-5881=20 Photo: NewsCom: AP=20 Archive: http://photoarchive.ap.org PRN Photo Desk 888-776-6555 or=20 212-782-2840=20 Company News On-Call: or fax=20 800-758-5804 ext. 419090=20 Web site: http://www.reliantenergy.com (REI)=20 By Kathleen McFall kmcfall@ftenergy.com President George W. Bush's energy package encourages the use of biomass fue= ls=20 for both transportation purposes and electricity generation. They can=20 provide a reliable source of energy at a stable price and they can also=20 generate income for farmers landowners and others who harness them his= =20 administration's report said.=20 Despite this warm and fuzzy language however the administration offered n= o=20 tangible funding for the fledgling biofuels industry=01*other than an exten= sion=20 of an existing ethanol tax credit that was not due to expire until 2007=01*= a=20 significant disappointment and surprise to advocates of renewable=20 transportation fuels. The report did recommend expanding tax credits for biomass energy projects = to=20 include forest-related and agriculture fuel sources and threw its weighty= =20 support at a new credit for electricity produced from biomass co-fired with= =20 coal. These recommendations are already included in the president's 2002=20 budget.=20 We are pleased that the administration included expansion of the biomass t= ax=20 credit and hope that with congressional leadership we will see this=20 expanded provision signed into law this year said Katherine Hamilton=20 co-director of the American Bioenergy Association (ABA).=20 Unlike other portions of the recommended energy policy biomass energy=20 probably will not suffer under the recent change in Senate composition giv= en=20 Senate Majority Leader Tom Daschle's (D-S.D.) agricultural constituency and= =20 his previous support of the biofuels industry.=20 According to the National Energy Policy Development report biomass account= s=20 for about 76% of non-hydropower renewable electricity generation=20 representing a total of about 1.6% of total U.S. electricity supply.=20 Biopower advocates however envision an even greater market penetration in= =20 the coming decades and point to its environmental and ancillary advantages.= =20 For example given that biomass combustion can be carbon dioxide-neutral (i= f=20 the growth and use cycle is managed sustainably) environmental groups=20 support an expanded role. Farmers with marginal lands that could grow bioma= ss=20 fuel could enjoy economic benefits. With large amounts of wood residue the= =20 forest industry also stands to benefit from wider use of wood as a power=20 source.=20 Renewable energy offers a particular advantage to the lumber and paper=20 industry and many analysts project that the industry may soon become a net= =20 seller of electricity.=20 In the lumber and paper industries wood scraps are sometimes directly fed= =20 into boilers to produce steam for their manufacturing processes or to heat= =20 their buildings. For that reason renewable energy offers a particular=20 advantage to the lumber and paper industry and many analysts project that= =20 the industry may soon become a net seller of electricity said the energy= =20 policy report.=20 Co-firing with coal Biomass=01*usually wood or wood residue=01*has traditionally been burned di= rectly=20 in the industrial sector for heat or on-site electricity generation.=20 According to the U.S. Department of Energy (DOE) the existing 10 GW of=20 installed capacity are based on this direct-combustion technology.=20 For utilities and power-generating companies with coal-fired capacity=20 however biomass co-firing may represent one of the least-cost renewable=20 energy options said the DOE. The process involves blending different=20 materials in varying amounts with coal.=20 Not only does mixing biomass with coal reduce emissions it is likely to be= =20 cost-effective. Southern Co. estimates that a biomass plant alone could=20 generate power depending on its location at 4 to 11 cents/kWh. Given that= =20 the lower range of this corresponds to coal generation costs there are=20 clearly circumstances where biomass-coal co-firing would be economically=20 attractive today. Plus the environmental public relations benefit for=20 utilities with coal-fired capacity would be valuable.=20 Domestic biomass generation capacity could reach 20-30 GW by the year 2020 = by=20 co-firing at existing U.S. coal-fired power plants.=20 According to a recent report prepared by five National Laboratories domest= ic=20 biomass generation capacity could reach 20-30 GW by the year 2020 by=20 co-firing at existing U.S. coal-fired power plants.=20 A recent report by the United Nations Intergovernmental Panel for Climate= =20 Change (IPCC) also cites the potential of coal co-firing with biomass. The= =20 IPCC report concludes that co-firing in coal boilers results in the lowest= =20 cost and least technical risk of the examined approaches for biomass=20 conversion to electricity.=20 Working out the technical kinks Already said the DOE six power plants in the U.S. are currently co-firing= =20 coal and wood residue products on a regular basis. Another 10 plants have= =20 successfully tested co-firing over the last decade and at least six more= =20 plants are now conducting or planning tests.=20 For example Southern Co. is working with DOE the Southern Research=20 Institute and the Electric Power Research Institute to study ways to grow a= nd=20 harvest switchgrass to blend with coal as a fuel for power generation.=20 Ideally suited for the southeastern U.S. switchgrass is a rugged grass tha= t=20 can be grown on marginal agricultural land. Reaching heights of up to 12=20 feet it requires little fertilization and herbicide and can be harvested= =20 twice a year.=20 Harvesting methods co-milling of switchgrass and pulverized coal=20 pilot-scale co-firing tests and a full-scale demonstration of co-firing at= =20 Alabama Power Co.'s Plant Gadsden are part of Southern Co.'s collaborative= =20 project.=20 The U.S. Agriculture Department is also taking a role in exploring the=20 potential of biomass and coal co-firing as a means to give farmers new=20 markets especially for currently idle land. The agency recently authorized= =20 funding for three co-firing demonstration projects.=20 In Iowa the Chariton Valley Biomass Project is a cooperative effort to=20 develop warm and cool season grasses (such as switchgrass) to co-fire with= =20 coal at Alliant Energy's Ottumwa Generating Station. The project is designe= d=20 to generate a sustained supply of 35 MW of biomass energy. Eventually the= =20 grass could substitute for as much as 5% of the coal currently burned at th= e=20 plant.=20 In addition to reducing coal emissions the Chariton Valley Biomass Project= =20 will support the local farm economy.=20 In addition to reducing coal emissions the project will support the local= =20 farm economy because the grass and trees will come from acreage taken out o= f=20 production under the Agriculture Department's Conservation Reserve Program= =20 (CRP). CRP land is generally marginal land that the government subsidizes= =20 farmers to leave idle to both prevent erosion and protect commodity prices= =20 from product surpluses.=20 The Pennsylvania Switchgrass Energy and Conservation Project will produce= =20 switchgrass on CRP land for sale to a local cooperative's coal-fired=20 fluid-bed combustors.=20 In New York the Agriculture Department project will fund willow biomass=20 crops and switchgrass on CRP acreage in the central and western part of the= =20 state. The primary markets for the willow biomass are two coal-burning powe= r=20 plants and a small university central heating facility.=20 Land conflicts transportation may be obstacles As these pilot projects illustrate biomass conversion efforts may have the= =20 most significant potential in rural areas. Since biomass is widely=20 distributed it has good potential to provide rural areas with a renewable= =20 source of energy. The challenge is to provide =01( conversion and delivery = of=20 bioenergy to the marketplace in the form of modern and competitive energy= =20 sources said the IPCC report.=20 A potential drawback to co-firing is transportation. Transportation of=20 wood-based energy products is more costly per unit of energy than coal f= or=20 example and most analysts believe it will prove most economical to site=20 generation plants near biomass sources.=20 The generating plant or biorefinery must be located near to the resource t= o=20 minimize transport costs of the low-energy-density biomass as well as to=20 minimize impacts on air and water use the IPCC report said. However note= s=20 the report's authors economies of scale may be significant enough to offse= t=20 the transport costs involved.=20 A potential drawback over the long term however for biomass conversion is= =20 land use conflicts. The IPCC report notes that by 2100 the global land=20 requirement to feed the growing world population will increase substantiall= y.=20 Up until this time there may well be sufficient land to supply all demands= =20 for food fibre and energy but at some stage after that land-use conflict= s=20 could arise and before that competition for water and irrigation may be a= =20 constraint.=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential - Rob Stewart Body:: Shanna I'm supportive of the raise to $150k. I think he is doing a good job and has a lot of value. He didn't fair well during the ranking due to lack of big $ or closure but maybe this will send him a good message. Thanks m What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I love you. Call me. What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Additional Lobbying Efforts Body:: FYI. I think they should try to get in to see Lundquist but I don't think we need to participate in this. We have been focussed on nation-wide issues when we have had the opportunity to meet with Lundquist and I don't think we should use our limited shots here. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ken Lay Mention At NRSC Reception Last Night Body:: Last night I attended the National Republican Senatorial Committee's reception at Senator Frist's home in DC. (Frist is the NRSC chairman this cycle.) Enron including Jeff and Linda had been invited to the reception the purpose of which was to introduce ex-RNC chairman Haley Barbour as the NRSC's National Finance Chairman. Present were over a dozen Republican senators including Minority Leader Lott Whip Nickles and Sens. Kay Bailey Hutchison Bunning (KY) Fitzgerald (IL) Cochran (MS) Inhofe (OK) Bond (MO) Crapo (ID) Voinovich (OH) Allen (VA) and Chafee (RI). The news from our perspective is that Haley Barbour singled out Ken Lay for praise as the first person to step to the plate and agree to help with their new Majority Makers program. This is the effort that Barbour will head up to raise $21 million for this election cycle by concentrating on events outside DC that would target businesses and business leaders without a DC presence. Barbour said that Ken had agreed to organize and chair a Houston fundraiser to raise $1 million toward the $21 million total. Ken was the first name he mentioned. The only others were the DeVos family in Michigan and Julie Finley a major GOP fundraiser based in DC. Needless to say I was suddenly quite popular after Haley made his remarks to the assembled group. Haley said he looked forward to working with us on this project. As you know from a previous e-mail Pat Shortridge had earlier seen our mutual friend Mitch Bainwol the executive director of the NRSC who had told Pat at lunch last week that Haley had spoken with Ken but last night was the first I had heard a dollar figure -- and a big one at that -- linked to the effort. While it was not stated I assume from the location and size of the event's goal that the President would be involved (but this is only an educated assumption on my part). Later I saw Karen Hughes of the White House staff but I do not think she was present when Haley made his comments. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Composition of unsecured creditors committee Body:: ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: 1. London, June 28 - 29; 2. Houston, July 16 - 17 Body:: Shirley No problem. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Hope youre staying dry! Body:: Kate Not yet. I will know sometimes in August - September. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Op Ed satire Body:: Can one of you forward to Ed or whoever you feel appropriate? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Attached are my comments on the Bliley amendment to the Largent amendment. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Skilling will be speaking at the National Press Club next week. He'll give an overview of Enron's business talk about what's going on in power markets and what should be done to fix the current problems. California will get covered as well. Other than what we have already discussed is there anything Jeff should know or address in his remarks? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CAISO Notice - Congestion Reform Proposal - Apendix B Body:: Market Participants: As part of the Congestion Management Reform Proposal the ISO has posted Appendix B Locational Price Dispersion Study on the ISO web site at . Please be aware that the file is very large (the Word version is 5.1 mb and the PDF version is somewhat smaller at 4.3 mb) so it will take a while to download. Byron Woertz Director Client Relations What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: California Update 07.18.01 Body:: These are useful updates. Please include Whalley Lavorato Parquet Dietrich Delainey Kitchens Haedicke Sanders Kirby Sharp Leff Calger Belden etc on future updates. Thanks From: Jeff Dasovich on 07/18/2001 08:18 PM Sent by: Jeff Dasovich To: Richard Shapiro/NA/Enron@Enron skean@enron.com Susan J Mara/NA/Enron@ENRON Harry Kingerski/Enron@EnronXGate James D Steffes/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Susan M Landwehr/Enron@EnronXGate mpalmer@enron.com Karen Denne/Enron@EnronXGate Janel Guerrero/Enron@EnronXGate Paul Kaufman/Enron@EnronXGate cc: Subject: California Update 07.18.01 The Senate the Assembly and the Governor are either poised to engage in very difficult negotiations or the three are about to crash and burn and Edison's going to be left dangling. In the Senate: The Senate bill 78XX is with about 90% likelihood going to be voted out of the Senate tonight---without a vote having taking place in any committee. Burton announced during one of the two informational hearings that this is it despite the view of just about everyone who appeared before the committees the bill likely won't prevent Edison from going bankrupt. The key features of the bill are: Banks and QFs get paid in full. Edison shareholders would be responsible for debts owed to suppliers No direct access. There are conflicting reports about whether the Senate will take up the bill tomorrow de-linking the bonds from the DWR contracts and whether the Republicans will go along with it. In the Assembly: The Committee is hearing the Wright and Hertzberg bills as we speak with Hertzberg's the likely winner. That bill now provides for Direct Access under certain conditions (the amendments describing the conditions were faxed today). We're attempting to get the July 12 date changed to the effective date of the bill or later. The Assembly likely won't vote the Hertzberg bill out until tomorrow at the earliest. The Problem: The Assembly and Senate bills are diametrically opposed in the way each approaches the problem---in short the bills are two ships passing in the night. The Democratic leaders (Governor Hertzberg Burton) aren't talking and Burton hasn't expressed any interest in talking---to anybody. The likely outcome given the circumstances: Burton says he's done what he needs to do (i.e. passed out a fair bill) the Assembly and Senate can't agree they finish the budget time runs out they leave Friday and Edison's left twisting. That said there's still a chance that the Governor could call Burton and sit down with Burton and Hertzberg and work something out by Friday or begin talking and postpone the recess until they get it worked out. But given Burton the chance of that happening seems very slim. In short little has changed since yesterday. Best Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Successful purchase of NBER Paper Body:: Return-Path: Received: from rly-xd03.mx.aol.com (rly-xd03.mail.aol.com [172.20.105.168]) by air-xd05.mail.aol.com (v77.14) with ESMTP Sun 10 Dec 2000 10:57:06 -0500 Received: from zeus.ssrn.com (zeus.ssrn.com [38.202.236.235]) by rly-xd03.mx.aol.com (v77.27) with ESMTP Sun 10 Dec 2000 10:56:51 -0500 Received: from ssrn.com ([38.202.236.235]) by zeus.ssrn.com (Post.Office MTA v3.5.3 release 223 ID# 0-61092U100L2S100V35) with SMTP id com Sun 10 Dec 2000 10:56:50 -0500 Subject: Successful purchase of NBER Paper Date: Sun 10 Dec 2000 10:56:49 -0500 From: Gregory_Gordon@ssrn.com (Gregory_Gordon) To: CC: Message-ID: X-Mailer: Unknown Dear Wincenty Kaminski: Thank you for your purchase at Social Science Research Network. Your credit card has been charged $ 5.00. This charge will appear on your statement as Social Science Electronic Publishing our parent company. The confirmation number for this transaction is NBER_103397 and a summary of your order is below. If you have any questions about this charge please email Mailto:NBERSupport@ssrn.com for assistance. If you have any comments or suggestions about how SSRN can improve this service please let me know at Thank you Gregory Gordon President ORDER INFORMATION Diagnosing Market Power in California's Restructured Wholesale Electricity Market NBER Collection Borenstein / Bushnell / Wolak BILLING INFORMATION Wincenty Kaminski 1400 Smith Houston TX 77002 USA 713 853 3848 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Ricardo Charvel Body:: ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FINAL Body:: Attached is the final letter. Please note - there was a small change at the top of page 2. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Supreme court brief Body:: Good brief. I have noted a few comments and questions throughout the text. Ignore my universal change to the word transmissions. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: San Jose Mercury News - California Officials Investigate Electric Megawatt Laundering Body:: California Officials Investigate Electric 'Megawatt Laundering' Steve Johnson San Jose Mercury News Calif. ( October 31 2000 ) Oct. 30--While investigating this summer's stunning spike in electricity prices state authorities have heard stories about a curious phenomenon: On days when the weather is hot batches of power generated in California are sold to other states. A little later in the day similar amounts of power are sold back to California -- but at much higher prices. The question is is it the same power? If so that could be megawatt laundering -- a multi-company conspiracy to evade California's wholesale price cap which covers power generated in California but not power sold into California from elsewhere. Worried that such transactions could be costing consumers millions of dollars several energy specialists raised concerns about megawatt laundering during a Federal Energy Regulatory Commission hearing a month ago in San Diego. And earlier this month state Sen. Steve Peace D-La Mesa -- who helped lead the push to deregulate electricity sales in California -- formally asked the commission to investigate the practice which he termed potentially illegal market coordination. But an unconfirmed news report last week said the federal agency had concluded that generators had not abused the market. And others say concerns about megawatt laundering are exaggerated. Among them is Jan Smutny-Jones executive director of the Independent Energy Producers Association a power-firm trade group and chairman of the Independent System Operator which oversees most of California's power grid. While acknowledging that such laundering is possible Smutny-Jones said there is no evidence it is actually occurring or is widespread. This is one of those things that's turning into an urban legend he said. I don't want to characterize this as a significant problem. Even some critics of the way power is purchased in California concede that most of what has been labeled megawatt laundering probably reflects nothing more sinister than the ability of some entrepreneurs to take advantage of a good deal when they see one. Nonetheless they see evidence that at least some California-produced power is being sold out of and back into the state at a higher price. And they blame that on loopholes in the system that they say ought to be closed because the transactions are helping to drive up the cost of power. The Independent System Operator invites this type of activity said Frank Wolak a Stanford economist who chairs the non-profit corporation's market surveillance committee which has warned of the potential for megawatt laundering in at least two reports this year. The thing that makes all these problems go is the fact that the ISO has said `We'll pay whatever it takes to keep the lights on' and that's screwing consumers big time. In 1998 when the state's energy markets were deregulated it was generally assumed that opening up the sale of electricity to competition would make power less expensive. As a precaution however officials at the Independent System Operator instituted wholesale price caps which they lowered twice this summer to help keep a lid on costs. On July 1 this year they reduced the cap from $750 per megawatt per hour to $500 one megawatt being sufficient power for 1000 homes. Then on Aug. 7 they cut it to $250. Unfortunately things haven't worked out the way officials had hoped. Wholesale prices rose dramatically this year. And while a freeze on retail utility rates has temporarily shielded Pacific Gas & Electric Co. customers from those soaring costs home electricity prices have tripled in San Diego where a similar freeze already has come off. In the process some generators learned that all it takes to get around the state's wholesale price caps is a basic understanding of how the market works. One of the best ways to get top dollar they learned was to hold off selling their electricity until the Independent System Operator issues what is known as an out-of-market call for energy which amounts to an emergency request for electricity. From May through September this year the overall price of power in the state averaged less than $125 per megawatt hour according to authorities. But over the same period power sold in response to out-of-market calls averaged more than $430. During the summer when energy use is at a maximum California typically imports about one-fourth of the power it uses from other states. Since power generated by firms in other states isn't limited by California's price cap those companies generally are in a better position than California firms to make a killing on out-of-market sales. But by cutting a deal with a collaborator in another state energy specialists say California generators also can profit handsomely -- despite the cap. Here's how: Say a California generator has 100 megawatts. Instead of selling it in California where the firm can receive no more than $250 per megawatt hour under the current cap it finds a utility an electricity broker or a corporate affiliate with an equal amount of power in another state such as Arizona. Then -- just before an expected heat wave in California which is likely to result in an out-of-market call for power here -- it convinces the other firm to do a trade. Under the deal the California generator sends its 100 megawatts for one hour to the company in Arizona where there is no price cap and earns $300 or more per megawatt -- for a total of $300000. In return the Arizona firm ships its 100 megawatts for one hour here. Since that power isn't subject to California's cap it earns perhaps $400 per megawatt -- for a total of $400000. Presumably energy specialists say the two firms then split the $100000 difference. The potential profit from such deals is considerable. Generators in and out of California received more than $110 million from out-of-market sales this summer according to the Independent System Operator. But determining if megawatt laundering is really happening how often and who might be benefiting is difficult. One California investigator said authorities first suspected that megawatt laundering was occurring when they noticed that precisely the same amount of power was being sold to another state and then sold back into California minutes later. But other experts said the evidence has rarely been that clear. While hundreds of megawatts is sold into and out of the state on any given day they said the suspicion that firms were conspiring to sell the same power back and forth has stemmed largely from unfounded speculation. One big problem for investigators trying to learn if the system has been abused is that confidentiality rules keep many of the details about these electricity transactions private. Entities like us and others who may be suffering from the consequences of this laundering don't necessarily have the documents to prove it said Gary Stern director of market monitoring for Southern California Edison one of the state's three main utilities. We can only speculate based on things we've heard from others about the practice....It's our hope that's one of the things that's being examined by the various federal and state agencies investigating this summer's extraordinary rise in California power prices. Indeed while some people say megawatt laundering can be substantially limited by ending the practice of paying more than the wholesale cap for out-of-state power others argue that it's just as important to eliminate the secrecy surrounding electricity transactions. I'd like to see more information made public said Jim Bushnell a researcher at the University of California Energy Institute in Berkeley who specializes in analyzing the state's energy markets. There are a lot of rumors circulating around this he said of megawatt laundering and it would help clarify if this is a serious problem. ----- To see more of the San Jose Mercury News or to subscribe to the newspaper go to http://www.sjmercury.com What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Senate Banking Hearing Body:: Thanks Chris. Rick - see the witness list below in case you want to try to get some points through to these witnesses. Chris Long 09/25/2000 04:14 PM To: Steven J Kean/NA/Enron@Enron Joe Hillings/Corp/Enron@ENRON cc: Amy Fabian/Corp/Enron@ENRON Maureen McVicker/NA/Enron@Enron Cynthia Sandherr/Corp/Enron@ENRON Subject: Senate Banking Hearing Steve: I got the copy of the letter on independent auditor from Ken Lay to SEC Chairman Levitt. I suggest we transmit the letter to the Senate Banking Subcommittee on Securities in preparation for their hearing noted below. I will prepare a cover letter for transmission. Let me know if this acceptable. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CA load growth Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I just saw the NYT article. Nice job. It's nicely positioned as an issue about India's resolve to encourage foreign investment and live up to contracts. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - JB 002 Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Please send regrets What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Wed 7/11: Mediator talked of a bigger refund: He reportedly suggested a $4.5 billion deal midway through the failed talks Sac Bee Wed 7/11: Davis repeats threat to sue FERC to get full refund Sac Bee Wed 7/11: Dan Walters: Davis plays in a virtual world while the= =20 energy reality continues=20 Sac Bee Wed 7/11: Energy Digest: Ratepayer panel shot down again Sac Bee Wed 7/11: Missing megawatts: Conservation saving state from=20 blackouts (Editorial) SD Union Wed 7/11: Governor tells FERC to be fair and then some SD Union Wed 7/11: Calpine says deal with state close on alleged overchar= ges SD Union Wed 7/11: Judge refuses to let ratepayers form official committe= e=20 in utility bankruptcy case LA Times Wed 7/11: Judge Bars Ratepayers Panel From PG&E Case SF Chron Wed 7/11: Developments in California's energy crisis SF Chron Wed 7/11: Enron Corp. sues to block Senate from forcing document= =20 release SF Chron Wed 7/11: Governor threatens to sue utilities for refunds=20 Davis says California won't settle for $1 billion SF Chron Wed 7/11: News briefs on the California power crisis Mercury News Wed 7/11: White House bends under energy conservation pressu= re=20 Mercury News Wed 7/11: Davis ups the voltage (Editorial) OC Register Wed 7/11: Lights go out on Davis' power show (Commentary) --- Mediator talked of a bigger refund: He reportedly suggested a $4.5 billion= =20 deal midway through the failed talks. By David Whitney Bee Washington Bureau (Published July 11 2001)=20 WASHINGTON -- Midway through the negotiations between California and power= =20 sellers to settle the myriad issues arising out of the state's energy crisi= s=20 the mediator told California's negotiating team that he thought a deal wort= h=20 more than $4.5 billion would be appropriate -- a much higher figure than he= =20 suggested after the talks ended Monday.=20 Whether the statement by Curtis Wagner the chief administrative law judge= =20 for the Federal Energy Regulatory Commission was a negotiating ploy or a= =20 reflection of his evolving beliefs is not clear.=20 Before the settlement talks began two weeks earlier Wagner said he thought= =20 Gov. Gray Davis' demand for $8.9 billion in refunds was too high and that a= =20 settlement probably would be in the range of $2 billion to $2.5 billion.=20 The disclosure that Wagner had contemplated a much higher figure midway=20 through the negotiations suggests the state had more support than the judge= =20 let on Monday when he said after the talks foundered that he thought a deal= =20 should involve hundreds of millions maybe a billion dollars.=20 While the state wants $8.9 billion $3 billion of that was for overcharges= =20 during the five months preceding last October and are beyond FERC's scope o= f=20 review. Even as a starting point then the $4.5 billion mentioned by Wagner= =20 represented 75 percent of the money the state was demanding for alleged pri= ce=20 gouging between October and May.=20 The judge's $4.5 billion figure divided between cash payments and savings= =20 from long-term power contracts was confirmed by three sources who asked to= =20 be identified only as close to the negotiations because participants had= =20 been required to sign confidentiality statements.=20 The sources gave virtually identical accounts of a July 2 meeting with Wagn= er=20 in which the judge also dismissed as inadequate a $670 million settlement= =20 offer made by power generators and marketers.=20 By Monday the settlement offer had risen to $716 million. But the state=20 refused to back off its $8.9 billion demand and there never was any seriou= s=20 back-and-forth negotiations during the 15-day period the regulatory=20 commission had given Wagner to craft a deal.=20 As a consequence of the failed talks Wagner said Monday that within a week= =20 he will send the five-member commission his recommendations on how it might= =20 approach an order refunding power overcharges.=20 Among Wagner's suggestions is that the commission convene a hearing before = a=20 different administrative judge to take testimony from generators marketers= =20 and the state on how to arrive at a fair settlement.=20 The options sketchily outlined by Wagner on Monday included limiting the ti= me=20 when refunds are allowed -- something that could reduce state claims by abo= ut=20 one-third -- and changing the way power plant costs are calculated to a=20 formula more favored by generators.=20 It is not clear whether Wagner who moved from one negotiating team to=20 another during his two-week quest for a deal ever raised the $4.5 billion= =20 settlement figure to the power marketers and generators.=20 Joel Newton who represented Dynegy Power Duke Energy Reliant Energy=20 Williams-AES and Mirant in the talks said Tuesday he was bound by the=20 confidentiality pledge to keep silent on the internal negotiations.=20 Wagner also is refusing all media calls.=20 According to the account of the negotiations confirmed by sources Tuesday= =20 Wagner was angry at the snail's pace of progress after the first week of th= e=20 talks.=20 On Friday June 29 Wagner called everyone into his hearing room and scolde= d=20 them. He condemned the California team saying they all ought to wear clow= n=20 suits because they were in the pocket of Davis and refused to show any= =20 independence.=20 He then turned to the generators and said that after a week of talks nothi= ng=20 had been heard from them. He told them he wanted them to produce real=20 numbers and hard numbers over the weekend and that if they didn't he wou= ld=20 -- and you're not going to like it.=20 Wagner's admonition apparently moved no one toward a deal. On Monday in th= e=20 meeting with the California delegation one source quoted Wagner as saying= =20 the settlement number he received from the generators and marketers is so= =20 low I can't even present it to you.=20 I'm not happy with the figures they're not adequate others quoted the= =20 judge as saying.=20 At that point the sources said Wagner said he was thinking of a settlemen= t=20 of $2.5 billion in cash $2 billion in long-term contract savings and other= =20 money from out-of-state investor-owned utilities and even the federal=20 Bonneville Power Administration which markets power from dams in the=20 Northwest.=20 But as the clock wound down on the negotiations nothing much happened unti= l=20 Friday and Saturday when the California team met with the five largest pow= er=20 generators.=20 It was at those meetings that the generators offered $510 million in refund= s=20 to settle their disputes with the state. But the money would have gone to= =20 reduce the tab for what they were owed by the state and California utilitie= s=20 and it was loaded with conditions including the state dropping all of its= =20 investigations and lawsuits.=20 Wagner declared the talks over Monday saying he was unable to bring the=20 parties together.=20 The Bee's David Whitney can be reached at (202) 383-0004 or=20 dwhitney@mcclatchydc.com. Davis repeats threat to sue FERC to get full refund=20 By Emily Bazar Bee Capitol Bureau=20 (Published July 11 2001)=20 Gov. Gray Davis shot words of caution at federal regulators Tuesday warnin= g=20 that he will sue them if they order power companies to refund anything less= =20 than the $8.9 billion he and other state officials have demanded.=20 The Democratic governor also lobbed threats at state legislators suggestin= g=20 that he may call a special session to prevent them from embarking upon a=20 monthlong summer break next week.=20 Instead of vacationing Davis said lawmakers must work to approve an=20 agreement between the state and Southern California Edison that would save= =20 the utility from bankruptcy.=20 Though the governor has indicated previously that the state may take the=20 Federal Energy Regulatory Commission to court his announcement Tuesday mad= e=20 it clear he intends to follow through.=20 Settlement talks with power generators to determine how much if any the= =20 companies overcharged California for electricity concluded Monday with no= =20 resolution.=20 Now the decision rests with the FERC's governing board and Davis said the= =20 state won't back away from the $8.9 billion figure it demanded during talks= .=20 You order what you think is fair Davis said during a news conference wit= h=20 the state's top negotiators. We'll take what you order and we'll see you = in=20 court.=20 Davis acknowledged that a legal battle could drag out for months or years.= =20 He added that he believes the disagreement -- or even a protracted court=20 battle -- will not affect a tentative agreement between the state and Ediso= n.=20 Under terms of the deal money to pay off the utility's debt would come fro= m=20 a state purchase of its transmission lines and from a portion of consumers'= =20 electricity rates.=20 According to the agreement the Legislature must approve the deal by Aug. 1= 5=20 and Davis said he intends to hold lawmakers to that date.=20 Davis said the deadline is important because creditor committees will=20 scrutinize the Legislature's every move to determine whether to force Ediso= n=20 into bankruptcy court rather than await a political deal.=20 Legislators are scheduled to leave for summer recess July 20 and return Aug= .=20 20.=20 Davis threatened to use his executive powers to force lawmakers to remain i= n=20 Sacramento and work on the Edison agreement if necessary.=20 The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com= . Dan Walters: Davis plays in a virtual world while the energy reality contin= ues (Published July 11 2001)=20 California still has a very real and very severe energy crisis to wit:=20 The state is still running up massive debts as it pays more for power than = it=20 can recover from ratepayers and is having trouble borrowing billions of=20 dollars to cover the debt.=20 There is a strong possibility perhaps a probability that when summer's he= at=20 truly descends there will be severe power blackouts as air conditioners=20 demand more juice than California can generate or buy.=20 One major utility Pacific Gas and Electric has filed for bankruptcy=20 protection and a second Southern California Edison is on the brink of=20 joining it.=20 There is however a virtual energy crisis consisting of political spin=20 media leaks and made-for-television buzz words -- and it is rapidly becomin= g=20 dominant while the real situation fades into the background.=20 This week's comic opera proceedings before a Federal Energy Regulatory=20 Commission administrative judge in Washington had little to do with reality= =20 and everything to do with the virtual version.=20 Gov. Gray Davis and other officials demanded $8.9 billion in refunds from t= he=20 generators and brokers who have been selling California power for the past= =20 year alleging that California is in Davis' words being gouged and rippe= d=20 off. But the number itself was more or less plucked out of thin air -- an= =20 arithmetic exercise by the state power grid's traffic controller not intend= ed=20 for a refund proceeding. And while Judge Curtis Wagner saw it as unrealisti= c=20 Davis and other state officials insisted on its validity.=20 There are refunds due that total hundreds of millions of dollars and maybe= a=20 billion dollars Wagner said as a final negotiating session collapsed. But= =20 that's a far cry from the $8.9 billion that Davis insists is due. If you= =20 think California is going to settle for $1 billion in refunds we will see= =20 you in court Davis said Tuesday.=20 Why is Davis being so belligerent? Because it's good politics. Ever since h= e=20 began berating out-of-state generators and accusing them of ripping off=20 California Davis' approval ratings have been climbing. If he settled for= =20 substantially less -- the power generators probably would agree to a couple= =20 of billion dollars to rid themselves of the matter -- Davis would be=20 embarrassed. Politically he's served by continuing to portray himself as= =20 fighting for California and against the out-of-state generators.=20 That it's more political construct than reality is indicated by another eve= nt=20 this week Davis' release of state power purchase data from early in the ye= ar=20 -- numbers that were made public only because a judge told him he had to do= =20 it.=20 Davis and his minions have been accusing Texas-based generators and power= =20 brokers of particularly egregious price gouging -- clearly playing on=20 Californians' instinctive mistrust of anything Texan and implying that Texa= n=20 George W. Bush is a co-conspirator. But the power purchase records -- which= =20 were released only to journalists willing to pay a stiff fee -- indicate th= at=20 less than 10 percent of California's power purchase dollars were going to= =20 Texas and the private sellers in general charged the state less than such= =20 publicly owned utilities as the Los Angeles Department of Water and Power.= =20 The clearly adverse position being taken by FERC and the purchase data that= =20 undercut his jingoistic sloganeering are not however deterring Davis from= =20 continuing to operate at least for public consumption in the melodramatic= =20 virtual world.=20 One cannot however ignore reality forever. The likelihood of a=20 pro-generator decision from FERC means that there will be no easy out for= =20 Davis or for his pending deal to prevent Southern California Edison from= =20 slipping into bankruptcy court. The Legislature has refused to act on the= =20 Edison rescue plan while it awaited an indication of whether the utility's= =20 debts would be slimmed down by FERC.=20 This week's farcical events make it more likely that the Edison deal will= =20 stall out permanently in the Legislature and its creditors will force the= =20 utility into bankruptcy court later this summer. That's part of that nasty= =20 old reality that cannot simply be wished away.=20 The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.c= om . Energy Digest: Ratepayer panel shot down again (Published July 11 2001)=20 SAN FRANCISCO -- U.S. Bankruptcy Judge Dennis Montali on Tuesday reaffirmed= =20 his earlier decision to disband a ratepayers committee that would have give= n=20 consumers an official voice in the Pacific Gas and Electric Co. bankruptcy= =20 case.=20 The judge said bankruptcy court isn't the right forum for refunding rates o= r=20 settling potential future claims.=20 He eliminated erroneous statements from the opinion he originally issued=20 seven weeks ago. U.S. bankruptcy trustee Linda Ekstrom Stanley who had mov= ed=20 for reconsideration called the new version a very careful decision but d= id=20 not rule out an appeal.=20 Stanley on May 4 appointed an official committee of ratepayers to represent= =20 PG&E customers saying they might be forced to pay for the utility's massiv= e=20 losses.=20 --Claire Cooper Missing megawatts: Conservation saving state from blackouts (Published July 11 2001)=20 A public that doesn't believe that California's electricity crisis is genui= ne=20 is nonetheless acting as if it is. Experts are revising down scary=20 predictions of rolling blackout after rolling blackout as Californians have= =20 opted to conserve rather than consume.=20 During June Californians cut back on electricity use by roughly 4750=20 megawatts when it mattered the most on hot afternoons. Those decisions=20 shaved about 12 percent from the expected demand. That's equivalent to the= =20 output of nine or 10 medium-size power plants. Last June grid operators ha= d=20 to call six shortage alerts. This June which was hotter they called none.= =20 For a state that's been derided as selfish and wasteful that's nothing sho= rt=20 of amazing.=20 Some of what Californians are doing now to conserve isn't likely to become= =20 habit in the long run. Businesses may want to turn back on all the banks of= =20 lights. Homeowners may decide that 82 degrees is the right temperature when= =20 power is short but too warm when California's supply emergency is over.=20 Yet there's a huge potential payoff into the future if some of these change= s=20 become permanent. It's encouraging that the most effective forms of=20 conservation -- switching to more energy-efficient appliances or=20 manufacturing techniques -- have yet to be implemented on a large scale.=20 Subsidies for these programs have yet to translate into changes in business= es=20 and in homes that will lower demand even further.=20 For a while this spring some attempted to diminish the role of conservatio= n.=20 Conservation is a personal virtue said Vice President Dick Cheney. But= =20 Californians know it's become both a personal and public necessity. The=20 public may have thought the electricity shortage was an illusion but=20 everyone knew that the higher electricity bills that began arriving in June= =20 were real. And so was the risk that the lights would go out on hot days.=20 Yes the state needs more supply to catch up with the growth in demand. Yet= =20 long after the crisis is over there will be plenty of potential on the=20 efficiency side of the equation as well to protect the quality of life and= =20 reduce the high electricity costs that will likely plague the state for yea= rs. Governor tells FERC to be fair and then some=20 Davis firm on demand for $8.9 billion refund By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 July 11 2001=20 SACRAMENTO -- Gov. Gray Davis had a tough message for federal regulators=20 yesterday after the failure of settlement talks in California's bid to get = an=20 $8.9 billion refund from electricity suppliers: See you in court.=20 The governor said California will seek a full $8.9 billion refund for=20 electricity overcharges even if federal regulators award the maximum refun= d=20 of $5.4 billion allowed under their guidelines.=20 Our message is just order what you are going to order Davis said of the= =20 Federal Energy Regulatory Commission. We believe you should order $8.9=20 billion. But you order what you think is fair. We will take what you order= =20 then we will see you in court.=20 Davis joined by his negotiating team made the remarks at a news conferenc= e=20 a day after two weeks of closed-door talks with suppliers in Washington=20 failed to reach an agreement.=20 An administrative law judge made a recommendation to the regulatory=20 commission that Davis' top negotiator Michael Kahn chairman of the=20 California Independent System Operator expects to result in a refund of mo= re=20 than $1 billion.=20 Davis said that a revealing decision will be made by the commission which = he=20 hopes has embarked on a new path with the appointment by President Bush o= f=20 two new members Pat Wood of Texas and Nora Brownell of Pennsylvania.=20 Are they on the side of consumers as the federal power act envisions them= =20 being Davis asked or are they just there to do the industry's bidding = as=20 they have so often in the past?=20 Kahn said rules adopted by FERC cut off the refund period at last October= =20 trimming $3 billion from the $8.9 billion overcharge claimed by California= =20 dating to May 2000.=20 He said FERC has no jurisdiction over municipal utilities such as the Los= =20 Angeles Department of Water and Power that sold power to the state. The=20 municipal districts overcharged the state by about $600 million according = to=20 Kahn.=20 As a result he said the maximum refund that FERC could order for Californ= ia=20 is about $5.4 billion.=20 We made it clear to everyone that if we did not settle for $8.9 billion w= e=20 would seek redress in court for the remainder of the money above $5.4=20 billion Kahn said.=20 Calpine of San Jose and several other generators have expressed interest in= =20 the state's offer to negotiate one-on-one with the state while the federal= =20 regulators consider their decision Kahn said. Calpine says deal with state close on alleged overcharges=20 By Don Thompson ASSOCIATED PRESS=20 July 10 2001=20 SACRAMENTO =01) Calpine Corp. said Tuesday it is near agreement with Califo= rnia=20 officials over money the state says the company overcharged for electricity= .=20 That would make it the first company to settle a part of the $8.9 billion t= he=20 state wants in negotiations before the Federal Energy Regulatory Commission= .=20 However San Jose-based Calpine has offered far less than the $236 million= =20 the state claims it is owed.=20 We obviously disagree with that number because we disagree with some of t= he=20 assumptions used for the estimate said Calpine spokesman Bill Highlander.= =20 We don't think it's anywhere near that. We think it's a low number.=20 He wouldn't specify the company's counteroffer but noted new FERC figures= =20 showing the company did $29 million in business with the state in the first= =20 five months of this year.=20 The California Independent System Operator estimated the company owed more = in=20 overcharges than it had in total sales for the period from May 2000 to May= =20 2001 a financial impossibility Highlander said.=20 The ISO essentially multiplied what Calpine was able to produce by the amou= nt=20 it charged for electricity Highlander said without taking into account ho= w=20 much electricity the company actually sold.=20 ISO spokesman Michael Bustamante defended the projections by the state's gr= id=20 operator estimates he said were validated during two weeks of FERC=20 negotiations that ended Monday. The ISO took the methodology adopted by the= =20 federal regulator in a June 19 order capping electricity rates then worked= =20 backward to May 2000 to reach its estimate Bustamante said.=20 Generators and state negotiators were unable to reach a settlement during t= he=20 two weeks of talks overseen by FERC chief administrative law judge Curtis L= .=20 Wagner leaving Wagner to make his own recommendation to the commission.=20 Wagner said Monday the state may be owed perhaps $1 billion in overcharges= =20 but said that could be offset by money the generators are owed for the powe= r=20 they sold into the state.=20 California officials believe generators owe about $4 billion in refunds usi= ng=20 the June 19 order that Wagner adopted as his benchmark even given Wagner's= =20 determination that the commission can only consider overcharges after Oct. = 2.=20 At one point during negotiations Wagner told California officials he thoug= ht=20 an appropriate settlement should top $4.5 billion according to one=20 negotiator who spoke on condition he not be named. Wagner suggested=20 generators could pay $2.5 billion in cash and $2 billion in long-term=20 electricity contracts at cheaper rates the source said.=20 That was very different from the $670 million in refunds Wagner privately= =20 said generators were offering. For instance the source said while Reliant= =20 Energy on Monday offered $50 million in refunds California believes=20 Reliant's share of overcharges is closer to $1 billion.=20 Jan Smutny-Jones executive director of the Independent Energy Producers= =20 applauded the possibility that some generators will settle with the state= =20 without waiting for a FERC decision and likely protracted court battle.=20 We need to solve this problem and move on Smutny-Jones said.=20 ?? =01) Associated Press writer Mark Sherman contributed to this story from=20 Washington D.C.=20 Judge refuses to let ratepayers form official committee in utility bankrupt= cy=20 case=20 ASSOCIATED PRESS=20 July 10 2001=20 SAN FRANCISCO =01) The federal judge overseeing Pacific Gas and Electric Co= .'s=20 bankruptcy case ruled Tuesday the utility's ratepayers cannot form an=20 official committee to represent their interests.=20 Ratepayer advocates had sought such recognition to ensure the utility would= =20 not raise rates further as a way of paying off its debts.=20 But U.S. Bankruptcy Judge Dennis Montali agreed with PG&E and the official= =20 creditors committee and rejected the idea for the second time in two months= .=20 Montali suggested instead that ratepayers organize an informal committee to= =20 bring their concerns to the court and said the ratepayers also could bring= =20 matters before the state Public Utilities Commission.=20 A separate committee of ratepayers would have been able to vote on the fina= l=20 reorganization of the company a plan that could affect power service and= =20 rates.=20 PG&E filed for Chapter 11 bankruptcy April 6 and owes billions of dollars = to=20 more than 50000 creditors. It was brought down in part by California's= =20 botched experiment with deregulation.=20 Judge Bars Ratepayers Panel From PG&E Case Power: Customers are not creditors in the utility's bankruptcy ruling says= .=20 Action does not preclude refunds for consumers. TIM REITERMAN TIMES STAFF WRITER July 11 2001 SAN FRANCISCO -- A federal judge Tuesday reaffirmed his decision to bar a= =20 ratepayers committee from Pacific Gas & Electric Co.'s bankruptcy case and= =20 denounced the committee's attorney for suggesting that the action could=20 prevent PG&E customers from receiving refunds for excessive energy charges. Judge Dennis Montali ruled against a U.S. trustee and the ratepayers=20 committee in deciding that ratepayers as a group had no claims and were not= =20 creditors when PG&E filed for bankruptcy on April 6. But Montali criticized misguided remarks by a committee attorney on July = 5=20 and news media accounts that followed the hearing. The judge said the repor= ts=20 left the misconception that by disallowing a ratepayers committee he would= =20 reject all claims of ratepayers and they could lose out on future refunds. The judge and PG&E officials emphasized that there are no matters involving= =20 PG&E customer refunds before the state Public Utilities Commission. State officials are seeking about $9 billion in refunds however from the= =20 Federal Energy Regulatory Commission for alleged overcharges to Californian= s=20 by energy companies since last year. The distribution of any ratepayer refunds would be decided by the PUC and= =20 customers would be paid whether or not they filed Bankruptcy Court claims b= y=20 a Sept. 5 deadline the judge and PG&E attorneys said. The judge took the highly unusual step of directing PG&E and U.S. Trustee= =20 Linda Ekstrom Stanley to consider remedies to allay any confusion among=20 PG&E's 5.5 million customers. He suggested publishing clarifications in newspapers that carried the=20 erroneous information in PG&E customer bills and on Web sites. Stanley had formed a ratepayers committee of business government and=20 consumer representatives saying they will be affected by PG&E's Chapter 11= =20 reorganization. But Montali decided that ratepayers do not qualify as creditors under=20 bankruptcy law and are not entitled to official status that allows them to= =20 participate in the bankruptcy and receive funding from PG&E. Stanley said she has not yet decided whether to appeal the ruling to federa= l=20 district court.=20 Copyright 2001 Los Angeles Times=20 Developments in California's energy crisis=20 The Associated Press Wednesday July 11 2001=20 2001 Associated Press=20 URL:=20 tate1 036EDT0129.DTL=20 (07-11) 07:36 PDT (AP) --=20 Developments in California's energy crisis:=20 WEDNESDAY=3D * No power alerts Wednesday as electricity reserves stay above 7 percent.= =20 TUESDAY=3D * U.S. Bankruptcy Judge Dennis Montali again agreed with PG&E and the=20 official creditors committee saying such a committee of Pacific Gas and=20 Electric Co. ratepayers has no legal standing in bankruptcy court. Ratepaye= r=20 advocates had sought the recognition to ensure the utility would not raise= =20 rates further as a way of paying off its debts.=20 * PG&E has agreed to pay $4.1 million in tax penalties to 49 counties where= =20 the utility owns property. The utility already paid $41.2 million in overdu= e=20 property taxes in May -- the additional amount covers a 10 percent fee for= =20 paying those taxes late.=20 * Calpine Corporation says it is near agreement with California officials= =20 over money the state says the company overcharged for electricity. That wou= ld=20 make it the first company to settle a portion of the $8.9 billion dollars t= he=20 state is seeking in proceedings before the Federal Energy Regulatory=20 Commission. But the San Jose-based company is offering much less than the= =20 $236 million dollars the state claims it is owed.=20 * No power alerts Tuesday as electricity reserves stay above 7 percent.=20 * Shares of Edison International closed at $14.05 up 5 cents. PG&E Corp.= =20 drop 55 cents to close at $13.55. Sempra Energy the parent company of San= =20 Diego Gas & Electric Co. closed at $27.67 up 15 cents.=20 WHAT'S NEXT=3D * The Senate committee investigating possible price manipulation in=20 California's energy market meets Wednesday. The committee will vote on=20 contempt citations against generators Mirant and Enron which failed to=20 comply with subpoenas for documents. The committee will meet again July 18 = to=20 consider compliance by six other suppliers that have until Tuesday to turn= =20 over documents.=20 THE PROBLEM: High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Southern California Edison and Pacific Gas and Electric say they've lost=20 nearly $14 billion since June 2000 to high wholesale prices the state's=20 electricity deregulation law bars them from passing on to consumers. PG&E= =20 saying it hasn't received the help it needs from regulators or state=20 lawmakers filed for federal bankruptcy protection April 6. Electricity and= =20 natural gas suppliers scared off by the companies' poor credit ratings ar= e=20 refusing to sell to them leading the state in January to start buying powe= r=20 for the utilities' nearly 9 million residential and business customers. The= =20 state is also buying power for a third investor-owned utility San Diego Ga= s=20 & Electric which is in better financial shape than much larger Edison and= =20 PG&E but is also struggling with high wholesale power costs.=20 The Public Utilities Commission has approved average rate increases of 37= =20 percent for the heaviest residential customers and 38 percent for commercia= l=20 customers and hikes of up to 49 percent for industrial customers and 15=20 percent or 20 percent for agricultural customers to help finance the state'= s=20 multibillion-dollar power buys.=20 Track the state's blackout warnings on the Web at=20 2001 Associated Press ?=20 Enron Corp. sues to block Senate from forcing document release=20 DON THOMPSON Associated Press Writer Wednesday July 11 2001=20 2001 Associated Press=20 URL:=20 tate1 212EDT0141.DTL=20 (07-11) 09:12 PDT SACRAMENTO (AP) --=20 Enron Corp. is suing state officials to stop a Senate subpoena of its=20 financial records in a dispute over alleged overcharges for its electricity= =20 sales to California.=20 They've sent two things to Texas -- our money and these documents and the= y=20 saying we can't get either one back said Laurence Drivon special legal= =20 counsel to the Senate Select Committee to Investigate Market Manipulation.= =20 The suit came hours before the committee will consider asking the full Sena= te=20 to cite the Houston-based company for contempt Wednesday. The other subject= =20 of possible sanctions Atlanta-based Mirant Inc. appears to be cooperating= =20 Drivon said.=20 Committee chairman Joe Dunn a Santa Ana Democrat said the committee's=20 investigation will continue despite Enron's pure act of intimidation. We'r= e=20 not going to back down.=20 Enron's suit said the company's financial papers are outside the committee'= s=20 jurisdiction because most of its operations and paperwork are outside=20 California.=20 That shouldn't matter Drivon said citing last year's successful of=20 out-of-state documents during the investigation into the activities of form= er=20 Insurance Commissioner Chuck Quackenbush. Previous investigations have=20 included documents subpoenaed from other nations he said.=20 Companies doing business in California cannot claim immunity from its laws = or=20 oversight Drivon and Dunn said. Houston-based Reliant Energy made the same= =20 argument but then agreed to turn over 1800 documents.=20 2001 Associated Press ?=20 Governor threatens to sue utilities for refunds=20 Davis says California won't settle for $1 billion=20 Mark Martin Chronicle Staff Writer Wednesday July 11 2001=20 2001 San Francisco Chronicle=20 URL:=20 /11/M N139275.DTL=20 Sacramento -- One day after a federal judge rebuked California's claim that= =20 energy generators owe the state $8.9 billion Gov. Gray Davis all but vowed= =20 to sue the companies to recoup the money.=20 If you think California will settle for $1 billion in refunds we'll see y= ou=20 in court Davis said yesterday.=20 Continuing his heated rhetoric on the energy crisis Davis blasted the ener= gy=20 companies for being inflexible during a 14-day negotiation session in=20 Washington D.C. that ended Monday. Both the state and power generators=20 argue each is owed money as a result of California's dysfunctional=20 electricity market.=20 Federal Energy Regulatory Commission chief administrative law Judge Curtis = L.=20 Wagner ended the talks by saying the state was owed far less than it claime= d=20 but the FERC's governing board will make a final decision on who owes what = to=20 whom in the coming months.=20 Yesterday Davis made it clear he wouldn't accept a FERC decision that=20 strayed far from the state's calculations that power companies overcharged= =20 California nearly $9 billion.=20 The ball is in the FERC's court he said. They must step up and provide= =20 the refunds we've asked for.=20 While Davis said California officials had gone to Washington prepared to=20 discuss ways to reach a settlement including renegotiating long-term=20 contracts to buy power an energy industry official faulted the state for i= ts=20 unwillingness to compromise.=20 Generators put forward an offer even though they believe no refunds are owe= d=20 said Jan Smutny-Jones executive director of the Independent Energy=20 Producers.=20 Smutny-Jones said the state needed to stop thinking it would get the $8.9= =20 billion.=20 It's clear from the way the issue was characterized by the judge that $9= =20 billion is not something the state is going to see any time in the near=20 future he added. It is not based in reality.=20 Davis also took heat from Republicans yesterday.=20 He desperately needs that refund so he can renegotiate the dreadful=20 contracts he has entered into said Rob Stutzman a consultant for the=20 California Republican Party. He's sitting at the poker table with very few= =20 chips.=20 In other energy news yesterday a judge refused to let a committee represen= t=20 the public in the Pacific Gas & Electric Co. bankruptcy case and said a=20 consumer lawyer's irresponsible position at a hearing last week could=20 mislead PG&E customers into filing needless refund claims with the court.= =20 U.S. Bankruptcy Judge Dennis Montali said any refunds owed to customers wer= e=20 unrelated to the bankruptcy case and would be determined by regulators.=20 At the hearing Thursday attorney KaarenThomas argued that unless a committ= ee=20 represented customers' interests PG&E could try to bar all refund claims= =20 that weren't filed by Sept. 5.=20 Montali ruled in May that the committee was not authorized by federal=20 bankruptcy law and reaffirmed his ruling yesterday.=20 Chronicle staff writers Lynda Gledhill and Robert Egelko contributed to thi= s=20 report.=20 E-mail Mark Martin at 2001 San Francisco Chronicle ? Page?A - 3=20 News briefs on the California power crisis=20 The Associated Press Wednesday July 11 2001=20 2001 Associated Press=20 URL:=20 tate0 738EDT0118.DTL=20 (07-11) 04:38 PDT SAN JOSE Calif. (AP) --=20 Energy supplier Calpine Corp. has reached a deal to purchase 236 billion=20 cubic feet of natural gas in Texas and New Mexico for $355 million plus=20 assumption of nearly $50 million of debt.=20 Company officials made the announcement Tuesday and said the purchase will= =20 increase its natural gas reserves.=20 This transaction meets our desire to own and operate production in a=20 strategic basin said Cathy Piece Calpine's director of land and=20 acquisitions. These assets significantly strengthen our reserve base and= =20 will help fuel our growing Western power program.=20 The San Jose-based company has agreed to purchase 35 wells in New Mexico th= at=20 produce 6 million cubic feet of gas per day from The Bayless Companies. The= =20 second transaction involves the acquisition of a majority interest of Micha= el=20 Petroleum of Houston. The Texas company produces about 43 million cubic fee= t=20 of gas per day.=20 Calpine officials said the agreements will allow them to meet their future= =20 capacity demands for both natural gas and electricity. The company wants to= =20 generate more than 70000 megawatts of electricity by the end of 2005 and= =20 have natural gas reserves of 6.7 trillion cubic feet.=20 LOS ANGELES (AP) -- Newly elected Mayor James Hahn has postponed selling th= e=20 city's surplus power to the state so he can examine how it will impact=20 ratepayers.=20 Hahn's predecessor Richard Riordan said last month the city's Department = of=20 Water and Power would sell its extra electricity -- about 500 megawatts a= =20 day_ to the state at cost between July and September.=20 The contract was supposed to have been signed last week.=20 Steve Maviglio a spokesman for Gov. Gray Davis said Tuesday that the stat= e=20 is ready to sign the contract.=20 We're ready to sign he said. Like most negotiations that aren't final= =20 things go back and forth. The new (Hahn) administration wants to review the= =20 document before it.=20 Davis had threatened to seize surplus power from municipal utilities which= =20 haven't been subjected to the California energy crisis because he claimed= =20 they were gouging the state.=20 TEMECULA Calif. (AP) -- State officials said they are studying alternative= =20 routes for a power transmission line proposed by San Diego Gas and Electric= =20 Co.=20 The utility wants to run a 500000-volt power line through southwestern=20 Riverside County connecting its power grid with Southern California Edison'= s.=20 The cost of the project is estimated at $271 million and must be approved b= y=20 the state's Public Utilities Commission.=20 But state officials listed alternative routes in papers released at a publi= c=20 hearing Tuesday. Some of the other ideas include putting the transmission= =20 line around the edges of an Indian reservation or running a route through t= he=20 Cleveland National Forest.=20 Once a final selection is made the information will be given to PUC=20 commissioners who will either approve or deny the project.=20 Many residents who live in the path of the proposed transmission line don't= =20 want the project. An attorney representing several groups that oppose SDG&E= 's=20 plans said there was no mention of alternative routes in environmental=20 documents submitted by the company.=20 Looking at the various route segments offered by SDG&E as alternatives is= =20 like trying to arrange the deck chairs on the Titanic said attorney Mark= =20 Mihaly.=20 2001 Associated Press ?=20 White House bends under energy conservation pressure=20 Posted at 6:25 a.m. PDT Wednesday July 11 2001=20 BY H. JOSEF HEBERT=20 Associated Press Writer=20 WASHINGTON (AP) -- Under pressure to include more conservation measures tha= t=20 reduce energy use congressional Republicans are moving toward a compromise= =20 to increase fuel efficiency requirements for sport utility vehicles as part= =20 of an energy package.=20 Key House GOP lawmakers said Tuesday they expect some increase in fuel=20 economy requirements especially for SUVs in energy legislation working it= s=20 way through the House. Democrats who have a majority in the Senate also= =20 favor requiring improved motor vehicle fuel efficiency.=20 At the same time the Bush administration signaled its willingness Tuesday = to=20 begin a rule-changing process that would allow the first increase in 25 yea= rs=20 in the federal corporate automobile fuel economy or CAFE standard.=20 Transportation Secretary Norman Mineta asked Congress to lift immediately a= =20 six-year prohibition that bans the department from consideration of fuel=20 economy increases. Lawmakers already agreed this year not to extend the ban= =20 beyond September but Mineta said he wants to start examining possible=20 changes right away.=20 CAFE standards which mandate fuel economy requirements for vehicle fleets= =20 have not been increased since their introduction in 1975. That year's law= =20 spurred by energy shortages in the early 1970s required passengers cars to= =20 meet a fleet average of at least 27.5 miles per gallon. Light trucks -- a= =20 category that includes SUVs vans and pickups -- have to meet a 20.7 mpg=20 fleet average.=20 With the widespread popularity of SUVs and vans in recent years many=20 environmentalists have argued that the lower truck standard has compromised= =20 the intent of the 1975 law. SUVs and vans comprise more than 40 percent of= =20 the passenger vehicles on the road today.=20 As three committees began crafting energy legislation lawmakers were=20 searching for a bipartisan compromise to increase fuel economy requirements= =20 for motor vehicles. Some increase in the CAFE requirement was virtually=20 assured several GOP lawmakers said although disagreements remain on how= =20 much of an increase whether it should apply to automobiles as well as SUVs= =20 vans and small trucks and the timetable for phasing in new requirements.= =20 Energy legislation that the House Energy and Commerce Committee was taking = up=20 later Wednesday contains no fuel economy provision.=20 But Rep. Billy Tauzin R-La. the committee chairman said discussions were= =20 under way to work out a compromise on a fuel economy proposal. He said he= =20 expects an amendment on CAFE to be added to the bill either during=20 deliberations in his committee or on the House floor.=20 Rep. Joe Barton R-Texas chairman of the subcommittee drafting the energy= =20 package saw a good chance the truck standards will be raised and said the= =20 automobile standard might be increased as well. Other GOP sources who talke= d=20 about the private discussions on condition of not being identified by name= =20 said a likely outcome is that the truck standard will be increased three or= =20 four mpg and the auto standard left alone.=20 Momentum for some CAFE increase has been growing in recent weeks as GOP=20 lawmakers came under increasing pressure to come up with additional=20 conservation proposals to those proposed in the White House's energy policy= .=20 It largely focuses on production with few specific measures to dramaticall= y=20 curb energy demand.=20 Democrats have pressed for tougher automobile fuel economy standards.=20 Automakers have fought attempts to increase the standards. They say such=20 government edicts limit consumer choice and force manufacturers to build=20 smaller cars that customers don't want. Supporters of increased fuel econom= y=20 argue that new technologies are available to increase fuel efficiency witho= ut=20 decreasing vehicle size.=20 President Bush's energy blueprint would consider CAFE increases but not=20 before a National Academy of Sciences report is issued probably this month= =20 on impact of the standard on energy savings safety and auto industry=20 competition. Davis ups the voltage=20 Published Wednesday July 11 2001 in the San Jose Mercury News=20 Vow to sue for refunds may be a bluff but he should keep pushing FERC=20 THE strategic choice facing Gov. Gray Davis in the struggle over electricit= y=20 price refunds has come down to three questions: When do you negotiate when= =20 do you demand and when do you bluff?=20 Negotiations are over Davis declared Tuesday. He demanded that the Federal= =20 Energy Regulatory Commission order refunds now. ``The case is nearly a year= =20 old'' he said. ``They have to decide which side they're on.''=20 Probably no one but Davis knew to what extent he was bluffing when he also= =20 said ``If you think California is going to settle for $1 billion in refund= s=20 we will see you in court.''=20 A FERC administrative judge said Monday that the amount due the state may b= e=20 around $1 billion or perhaps nothing at all when counter-claims against t= he=20 state are subtracted.=20 Energy experts are divided about whether the state would win a suit to=20 overturn a decision by a federal commission. The federal courts have some= =20 limited jurisdiction according to University of California Energy Institut= e=20 director Severin Borenstein but that a court would reverse a commission in= a=20 case like this is ``extremely unlikely.''=20 Frank Wolak a Stanford economist had the opposite view when asked whethe= r=20 the state has a good chance of winning: ``I think so. It happens all the=20 time.''=20 At a Sacramento press conference Davis continued to insist that there have= =20 been overcharges of $8.9 billion. But other state officials conceded that= =20 only $5.4 billion of that is actually on the table in the FERC proceedings.= =20 Davis said he'll take what he can get there and sue for the rest.=20 The state argues that because FERC has determined that wholesale prices hav= e=20 not met the Federal Power Act's requirement to be ``just and reasonable''= =20 refunds are in order. But the commission has not defined what portion=20 exceeded ``just and reasonable.''=20 Throughout his press conference Davis used the prospect of litigation like= a=20 goad to spur the federal regulators into action. But if you listened=20 carefully he also indicated he'll give them more time to consider the case= .=20 Considering the iffy odds of winning in court we suggest he keep goading t= he=20 federal commissioners -- while giving them all the time they need. Wednesday July 11 2001=20 Lights go out on Davis' power show=20 Three new developments show that some economic reality finally is being=20 applied to California's electricity crisis:=20 First The nation's chief energy judge said Monday that California is owed= =20 maybe $1 billion in refunds from power generators a fraction of the $8.9= =20 billion demanded by Gov. Gray Davis reported the Register yesterday. Even= =20 that $1 billion amount might be balanced by the amount the state still owes= =20 the power producers.=20 To suggest workable and market-oriented solutions to the California=20 electricity crisis. Judge Curtis Wagner's recommendation will be taken up by the Federal Energy= =20 Regulatory Commission which is being petitioned for the money by the state= =20 of California.=20 Because the judge's words will bolster FERC's apparent desire not to grant= =20 the refunds the state probably will go to court where the matter could = be=20 stuck for years. In the long term this may indicate that competitive electricity has a=20 future even in California but not thanks to the state Robert Michaels a= =20 professor of economics at Cal State Fullerton told us. He's referring to t= he=20 state's botched 1996 deregulation effort which has been made worse by Go= v.=20 Gray Davis and other officials since the crisis began a year ago. FERC since the 1980s favors competition within the parameters of politica= l=20 reality Mr. Michaels added. Now we're at square one: The industry doesn'= t=20 owe $9 billion to California. As this process continues he said another= =20 positive aspect will be that a lot of facts will get aired. We'll see what= =20 has been happening in the markets in which power is bought and sold. Second light already is shining on one area: This crisis was not Made in= =20 Texas'' by cronies of President Bush as Gov. Davis and other Democrats hav= e=20 been contending.=20 In May the governor attacked the president for ignoring the greed of thes= e=20 Texas energy companies such as Reliant and Dynergy. In fact according to information on state power contracts the governor=20 finally released Monday Texas companies were way down on the list of=20 producers.=20 In roughly the first five months of the year the state shelled out $1.2= =20 billion to Atlanta-based Mirant the most any company was paid for=20 electricity followed by $1 billion to Powerex the marketing arm of BC Hyd= ro=20 in British Columbia [in Canada]. It also paid $331 million to the Los Angel= es=20 Department of Water and Power reported the San Jose Mercury News. Only about 10 percent of our state's power during this period came from=20 companies with headquarters in Texas. Third and finally a new study by the Cato Institute shows what should be= =20 done next:=20 lAbolish retail rate caps allowing prices to be set by the market.=20 This would be a better system than the present one where the state buys th= e=20 electricity and passes much of the cost along through the state budget (pai= d=20 by taxpayers) and bonds paid for by long-term electricity price increases.= =20 Higher immediate prices would encourage conservation and production leadin= g=20 in time to lower prices. lMove to real-time pricing so people shift activities such as washing to=20 off-peak hours.=20 lAbolish the Independent System Operator which moves electrons around.=20 Give this function back to the utilities who did it far better before=20 deregulation. Gov. Davis should set the pace by ending his Clintonian bla= me=20 shifting and embracing these realistic solutions.=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Question Body:: Dear Ken I'm not sure quite were to turn but was hoping you could assist me. I would like to keep this confidential especially regarding the New York Office. As my request has nothing to do with the people in this office or the group they are wonderful I've been with Enron since '97 and I relocated up to Connecticut to work with the New Power Company when I thought that the Enron employees would stay Enron employees. Afterwards of course we all were changed to NewPower employees. After a couple of months I made the move back to Enron and went to the New York office and work with the Enron Metals group here at 53rd street. (It was never my intention to leave Enron) Since the bombing I feel very displaced and my husband and I would really like to come back to Houston and was wondering if you could help me. I was on the trading floor working with Dave Delainey's group when he was in ENA and also was the Exec Secretary/Coordinator with the MWB group in George Warsoff's group. I would appreciate it very much if you were able to assist/guide me. Sincerely Teri Teri Connor-Smith Admin Coordinator Enron Metals & Commodities Corp tsmith3@enron.com (212)715-5601 What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Gas Controllers Association speaker (California Energy Crisis) Body:: I can do it but have to be at the airport before 2:00 for a flight to NY. Sherri Sera 03/14/2001 04:17 PM To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Mary Poorman/NA/Enron@Enron Subject: Gas Controller's Association speaker (California Energy Crisis) Steve Jeff will be in Boston on this date doing 1:1s following 1Q earnings release. Is this something you would be interested in/available to do? If not who would you recommend sending it to? Thanks SRS ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: AP Wire services Tues 3/20: Calif. Officials Order Blackouts Dow Jones News Tues 3/20: California Panel to Order Utilities to Make $1= =20 Billion in Back Payments SF Chron 3/20: As Davis Seeks Money Lawmakers Want Answers=20 Members of both parties angry at lack of dialogue Fresno Bee Tues 3/20: Jones rips state on energy crisis Sac Bee Wed. 3/21: Day 2 -- Battling blackouts: Payment plan sought to= =20 restart small plants Sac Bee Wed. 3/21: Hospitals take hit seek power guarantee Sac Bee Wed. 3/21: Lodi still won't pull the plug San Diego Union Tues. 3/20: Blackouts hit for second day break seen=20 Wednesday San Diego Union Tues. 3/20: State power regulators working on energy=20 rescue=20 San Diego Union Tues. 3/20: Federal regulators scored for not ordering= =20 more California refunds LA Times Wed. 3/21: Second Day of Blackouts Disrupts 500000 Home and= =20 Businesses LA Times Wed. 3/21: Fragile Supply Network Apt to Fail LA Times Wed. 3/21: Elevator Anxiety is Riding High LA Times Wed. 3/21: State says it's accelerating plan to buy Power=20 Utilities' Grid LA Times Wed. 3/21: L.A. Long Beach File Suits Over Gas Companies'=20 Prices LA Times Wed. 3/21: Davis OKs Subsidy of Pollution Fees LA Times Wed. 3/21: As Losses Mount Companies work around outages LA Times Wed. 3/21: Commentary: A Blackout on Answers LA Times Wed. 3/21: Commentary: Rolling Blackouts: Blatant Extortion SF Chron Wed. 3/21: Utilities' Demand Blocks Bailout=20 NEGOTIATIONS HIT SNAG: PG&E Edison want end to price freeze if they sell= =20 transmission lines to state SF Chron Wed. 3/21: Utilities' Demand Blocks Bailout=20 BLACKOUTS ROLL ON: Weather increased consumption blamed SF Chron Wed. 3/21: Manners Go Out the Window=20 Pedestrians in peril as drivers turn darkened S.F. streets into free-for-al= l SF Chron Tues. 3/20: Historic Blackouts in State=20 Bay Area learns to cope SF Chron. Tues. 3/20: Second day of rolling blackouts in power-starved= =20 California Mercury News. Wed. 3/21: Bay Area Residents Learning to roll with=20 Blackouts Orange County Wed. 3/21: Powerless Again Orange County Wed. 3/21: The iceman shunneth effects of hourlong blacko= ut Orange County Wed. 3/21: Traffic officials are seeing red over blackout= s Orange County Wed. 3/21: Alternative power producers cut back or shut= =20 down as payments from big utilities lag Orange County Wed. 3/21: O.C. saves its energy -- for blaming others Orange County Wed. 3/21: Blackout readiness on agenda Dow Jones Energy News Wed. 3/21: Calif To Order Utils To Pay Small=20 Generators Up Front-Gov Dow Jones Energy News. Wed. 3/21: PG&E Says It Is Negotiating With=20 Qualifying Facilities Energy Insight Wed. 3/21: New York at the Crossroads --- Calif. Officials Order Blackouts=20 By PAUL CHAVEZ Associated Press Writer=20 LOS ANGELES (AP) - State power managers ordered rolling blackouts across=20 California for a second straight day Tuesday as demand for electricity agai= n=20 exceeded supply.=20 The same factors that collided to strap California's power supply on Monday= =20 hit again officials with the Independent System Operator said. Those inclu= de=20 reduced electricity imports from the Pacific Northwest numerous power plan= ts=20 offline for repairs and higher-than-expected demand because of warm=20 temperatures.=20 A two-unit Southern California plant that the ISO hoped would be working=20 Tuesday had not been fixed. One of its units might go online at noon to hel= p=20 the situation the ISO's Jim Detmers said.=20 In addition hydroelectric power imports from the Northwest were 800=20 megawatts lower than Monday he said. The ISO oversees most of the state's= =20 power grid.=20 --- California Panel to Order Utilities to Make $1 Billion in Back Payments By Jason Leopold 03/20/2001 Dow Jones Business News (Copyright (c) 2001 Dow Jones & Company Inc.) Dow Jones Newswires=20 LOS ANGELES -- The California Public Utilities Commission will order Edison= =20 International's Southern California Edison and PG&E Corp.'s Pacific Gas &= =20 Electric unit to pay small power generators that are qualified utilities=20 about $1 billion in past-due payments in order to keep the plant owners fro= m=20 dragging the utilities into an involuntary bankruptcy proceedings and to= =20 also ensure the generation units keep pumping out electricity people=20 familiar with the matter told Dow Jones Newswires late Monday. Gov. Gray Davis state Sen. Debra Bowen and Assemblymembers Fred Keeley an= d=20 Robert Hertzberg all Democrats spent most of the day y trying to hammer o= ut=20 an agreement with the so-called qualifying facilities alternative power=20 producers that use the wind sun steam and biomass to generate electricity= =20 for the state on supply contracts and past payments the utilities failed t= o=20 make.=20 The qualifying facilities which represent about one-third of the state's= =20 total power supply and signed contracts to sell power directly to the=20 utilities under a government mandate would then agree to sign power-supply= =20 contracts with the utilities for a period of five to 10 years for about $79= a=20 megawatt hour for the first five years and about $61 a megawatt hour=20 thereafter two sources involved in the negotiations said.=20 The PUC is expected to issue a draft resolution on the issue sometime this= =20 week one source said.=20 The lawmakers wouldn't comment on the details of their talks Monday.=20 Representatives with SoCal Ed (EIX) and PG&E (PCG) said they were unaware= =20 Gov. Davis and his administration were meeting on the issue.=20 The utilities are more than $13 billion in debt and have failed to make=20 payments on their qualifying-facilities contracts since November. PG&E has= =20 paid some of its qualified facilities just a fraction of what they are owed= .=20 Legislation To Restructure QF Rates Stalls In Senate Energy Committee=20 Mr. Keeley had recently drafted legislation along with state Sen. Jim=20 Battin a Republican from Palm Desert that would have restructured the rat= es=20 the qualified facilities charge the utilities from $170 a megawatt hour to= =20 $80 a megawatt hour for five years.=20 The bill SB47X stalled in the Senate Energy Committee of which Ms. Bowen= =20 chairs. SoCal Ed opposed the legislation saying the rates were still too= =20 high. A utility spokesman said the qualified-facilities rates should be=20 reduced to under $50 a megawatt hour.=20 But the lawmakers and the governor is trying to avoid the need for=20 legislation largely because there isn't much support in both houses for su= ch=20 a bill and the chance that it won't be passed in time to keep the qualified= =20 facilities from dragging the utilities into involuntary bankruptcy=20 proceedings the legislative source said.=20 The PUC will take over the issue from the Legislature the source said.=20 Monday about 3000 megawatts of qualified-facilities generation went offli= ne=20 because the companies that operate the power plants can no longer afford to= =20 buy natural gas used to fuel the plants due to the utilities' failure to pa= y=20 money owed to the companies said Jim Detmers vice president of operations= =20 for the state's Independent System Operator.=20 The outages triggered a major shortfall in the state which resulted in near= ly=20 eight hours of statewide rolling blackouts Monday.=20 Many owners of the qualified-facilities said without immediate relief they= =20 would likely force SoCal Ed and possibly PG&E into involuntary bankruptcy= =20 perhaps as soon as Thursday.=20 One such facility CalEnergyOperating Co. wants to be freed temporarily fr= om=20 its contract with the utility and be allowed to sell its electricity to thi= rd=20 parties until the utility is able to pay its bills. CalEnergy is an affilia= te=20 of MidAmerican Energy Holdings Co. which is majority owned by Warren=20 Buffet's Berkshire Hathaway Inc. (BRKA).=20 The company sued SoCal Ed last month and the case is scheduled to be heard= =20 Thursday in Imperial County Superior Court. If a judge delivers an=20 unfavorable ruling CalEnergy and other unsecured creditors would drag SoCa= l=20 Ed into involuntary bankruptcy three executives with the companies involve= d=20 said.=20 CalEnergy is said to be organizing a bankruptcy petition now circulating=20 among six of Southern California Edison's independent power suppliers and= =20 could file the petition very quickly if it fails in its suit Thursday said= =20 executives with three of the six companies.=20 Write to Jason Leopold at jason.leopold@dowjones.com=20 Copyright (c) 2001 Dow Jones & Company Inc.=20 All Rights Reserved --- --- As Davis Seeks Money Lawmakers Want Answers=20 Members of both parties angry at lack of dialogue=20 Lynda Gledhill Greg Lucas Chronicle Sacramento Bureau Tuesday March 20 2001=20 2001 San Francisco Chronicle=20 Sacramento -- The Legislature has warned it may block further state purchas= es=20 of electricity as lawmakers' frustration with Gov. Gray Davis' handling of= =20 the energy crisis increases.=20 A test may come soon because Davis asked yesterday for another $500 million= =20 to continue buying power.=20 Sen. Steve Peace D-El Cajon chairman of the Joint Legislative Budget=20 Committee wrote to Davis' Finance Department on Friday that the committee= =20 might deny further spending requests in the absence any discernable=20 progress from the Public Utilities Commission to ensure that the state wou= ld=20 get its money back.=20 Members of the committee both Republican and Democratic said they support= ed=20 Peace's call for more oversight of the spending given the lack of=20 information from Davis on details of the state's power purchases.=20 He's been holding things close to the chest and that bothers me said Se= n.=20 John Vasconcellos D-Santa Clara. I want to know a lot more.=20 Sen. Dick Ackerman R-Fullerton said the administration has been=20 stonewalling us about how much is being spent and how much power we're=20 getting for it. When the state is spending that kind of money at a minimum= =20 legislators should know for what.=20 The state had spent $2.6 billion on electricity through March 11. Davis'=20 request for more money would put the state at the $3 billion mark by the=20 middle of April. The state is spending an average of $49 million a day.=20 The money is supposed to be paid back through the rates collected from=20 utilities' customers. It is up to the PUC to decide how to divide that mone= y=20 among the state the utilities and the utilities' debtors. The commission i= s=20 scheduled to take up the issue at its March 27 meeting.=20 The problem is that there appear to be more demands on the money than there= =20 is money to go around.=20 The utilities have said they need the money to pay off some of their=20 creditors. Among those looking for cash are alternative-power generators th= at=20 were selling electricity to Pacific Gas and Electric Co. and Southern=20 California Edison. Half of them have shut down because they have not been= =20 paid.=20 Earlier this month the PUC granted the Department of Water Resources whic= h=20 has been purchasing electricity for the state the power to recoup its full= =20 costs through rates.=20 It's unclear whether that can be accomplished without raising electricity= =20 prices though Davis has insisted he can solve the crisis without boosting= =20 rates.=20 Lawmakers said they approved the bill that allowed the state to buy power i= n=20 the belief such purchases would be a stopgap until the Davis administration= =20 could sign long-term contracts with power suppliers. However only about 19= =20 contracts have been signed to date out of 42 agreements. If all the=20 contracts are signed they will account for about 70 percent of the power= =20 California is expected to need.=20 It was our expectation some of these contracts would kick in said=20 Assemblywoman Carole Migden D-San Francisco. This was designed to only be= =20 bridge money to avert a power disaster. We should hold firm and come up wit= h=20 a plan.=20 I recall about three weeks ago when we first asked about one of these $500= =20 million letters Migden said. We said maybe this one is necessary but=20 there won't be carte blanche approval of any future requests. I'm pleased= =20 Sen. Peace is taking that approach.=20 To Assemblyman George Runner R-Lancaster Peace's letter was another way= =20 for the Legislature to send a message we need to be in this loop. We're jus= t=20 getting a small little dribble of information which just creates more=20 questions.=20 A spokesman for the Department of Finance said officials hoped to work with= =20 the committee members about their concerns.=20 --- --- Jones rips state on energy crisis=20 Secretary of state hints that he'll take on Davis in 2002.=20 By John Ellis=20 The Fresno Bee (Published March 20 2001)=20 Officially he's Bill Jones secretary of state for California. Unofficiall= y=20 he's Bill Jones 2002 gubernatorial candidate.=20 The evidence is right there between the lines -- in the subtleties of his= =20 speeches their subject matter and the way Jones carries himself when he's= =20 in public.=20 Monday was no different as Jones addressed a Rotary Club luncheon in Fresn= o=20 full of people who are assuming -- though nothing is official -- that the= =20 Fresno native will soon announce his intention to challenge Gov. Davis next= =20 year.=20 Bill they call me governor Chas Looney a former Rotary Club district= =20 governor quipped to Jones. I look forward to the day we all can call you= =20 governor.=20 Jones then proceeded to deliver a speech to a packed house in the DoubleTre= e=20 Hotel that touched on his accomplishments as secretary of state but quickl= y=20 moved to his main topic: California's crumbling infrastructure and how the= =20 energy crisis is affecting the state.=20 Always in the background but never mentioned by name was Davis. Jones was= =20 careful to hew to the Rotary rule that speeches steer clear of partisan=20 politics.=20 Still Jones looked sounded and acted like a candidate for governor and= =20 near the end of his speech he promised his decision would come soon.=20 The Fresno Republican's speech began by highlighting his work in passing th= e=20 Three Strikes and You're Out initiative in 1994.=20 Jones also talked of his efforts to remove 2 million inactive California=20 voters from the rolls.=20 But it was clearly the energy crisis and its ramifications -- an issue=20 Republicans feel they can pin on Davis and the Democratic-controlled=20 Legislature -- that was the centerpiece of the speech.=20 Today the energy crisis is being driven he said by a lack of power plant= =20 construction. And while billions go to solve the crisis he said the state= =20 faces $100 billion in unmet infrastructure needs -- everything from school= =20 repair to road repair.=20 Doesn't that scare you? Jones asked.=20 He then recounted the warning signs -- ignored by the state he said -- of= =20 the looming energy crisis.=20 He cited the initial warnings that the deregulation bill was flawed last= =20 summer's request by Edison and Pacific Gas & Electric to allow forward=20 contracting and the Republican request for a special session to deal with t= he=20 energy crisis. All ignored Jones said.=20 Now Edison and PG&E are near bankruptcy and the state finds itself steppin= g=20 up as a creditor. And the solution now becomes California getting into the= =20 energy business he said. Or even carrying it to a greater degree not= =20 just in the short term to buy power to keep the lights on. I'm talking abou= t=20 basically socializing the energy business.=20 Jones said he prefers low-interest loans to Edison and PG&E taking the=20 electric grid as collateral.=20 I just do not believe in California getting into something it does not kno= w=20 how to do -- has never done before -- on top of all of our other=20 obligations he said.=20 It really worries me that California will not be able to endure that type = of=20 obligation.=20 Jones said polls now show increasing numbers of residents saying the state = is=20 headed in the wrong direction.=20 I feel obligated to speak out and say there is a better way Jones said. --- --- Day 2 -- Battling blackouts: Payment plan sought to restart small plants By Dale Kasler and Carrie Peyton Bee Staff Writers (Published March 21 2001)=20 Blackouts rolled across California for a second straight day Tuesday=20 snarling traffic darkening businesses and sending state officials scrambli= ng=20 to craft a payment plan to revive the wind farms and other critically neede= d=20 small energy producers that have shut down because of financial woes.=20 On a day when another 570000 customers lost power Gov. Gray Davis said th= e=20 Public Utilities Commission and the Legislature would move promptly to orde= r=20 Pacific Gas and Electric Co. and Southern California Edison to start paying= =20 those small energy producers for their electricity. Davis said the two=20 utilities will face considerable fines if they don't pay up.=20 But several of the producers known as qualifying facilities said they= =20 doubted Davis' plan would go far enough to get them back in operation. And = it=20 wasn't clear whether the plan would keep the increasingly impatient=20 alternative producers from hauling one or both of the big utilities into=20 bankruptcy court as some have threatened.=20 The shortage of power from the qualifying facilities -- plus a near-record= =20 heat wave (downtown Sacramento topped off at 83 degrees one degree short o= f=20 the 84 degree record set in 1960) a lack of hydropower and other problems = --=20 prompted the state's Independent System Operator to order a second day of= =20 blackouts starting mid-morning. But the blackouts hit only about half as ma= ny=20 Californians as Monday's with late afternoon conservation efforts helping= =20 balance supply with demand.=20 The blackouts usually about an hour long hit about 7600 Sacramento=20 Municipal Utility District customers in Elk Grove and south Sacramento=20 County. PG&E customers in suburban counties were affected as well.=20 The order darkened shops in San Francisco's Chinatown and was blamed for a= =20 crash that left two motorists seriously injured in the Los Angeles suburb o= f=20 South El Monte. A Sun Microsystems Inc. factory in Newark had to close for= =20 several hours.=20 Most Californians took the blackouts in stride though. Elk Grove High Scho= ol=20 students filed outside to play hacky sack. Coffee shop patrons in Davis=20 milled outdoors enjoying the unseasonably warm weather.=20 Yet the blackout order was met with outright defiance by one municipal=20 utility. The city of Lodi refused to cut power to its residents Monday or= =20 Tuesday saying it shouldn't have to suffer because of the financial crisis= =20 afflicting PG&E and Edison.=20 The outlook for today and the near future was brighter as several big powe= r=20 plants came back on line after repairs. ISO officials also praised=20 Californians' conservation efforts which had faltered in the morning but= =20 came on strong in the afternoon helping to prevent further blackouts. By= =20 evening the grid was in a relatively mild Stage 2 power alert.=20 But the second day of blackouts -- plus an increasing threat of utility=20 bankruptcy -- pushed Davis to the brink. The governor cobbled together a=20 payment plan to rescue the qualifying facilities -- some 600 wind farms=20 geothermal plants and other alternative-energy generators whose production= =20 has become increasingly vital in recent days.=20 Under Davis' plan the Legislature and the PUC would order PG&E and Edison = to=20 pay the qualifying facilities for power delivered after April 1. The=20 utilities are required to buy power from the qualifying facilities under a= =20 1978 federal law designed to bring cheaper and cleaner forms of electricity= =20 to market.=20 Davis said the PUC would release a proposed order late Tuesday that would= =20 require the utilities to pay the qualifying facilities $79 a megawatt hour= =20 for five-year contracts or $69 for 10-year contracts. The Legislature also= =20 would have to pass a law authorizing the PUC to issue such an order.=20 But the situation was far from resolved late Tuesday and PG&E and Edison= =20 were likely to oppose at least portions of Davis' plan.=20 Edison is willing only to make some kind of partial payments going forward= =20 said Thomas Higgins a senior vice president with parent company Edison=20 International. We have a limited amount of resources available to us in=20 rates ... and that's the constraining factor.=20 PG&E which has been making partial payments to the qualifying facilities= =20 said it could pay them in advance in full for future power deliveries.=20 But PG&E said such payments would eat up half the $400 million it has=20 available each month to buy power -- and unless it gets a rate hike there= =20 wouldn't be enough to pay the qualifying facilities and cover other expense= s=20 including the cost of reimbursing the state Department of Water Resources f= or=20 the power the agency is buying on behalf of the troubled utility.=20 PG&E's proposal could represent a challenge of sorts to state officials:=20 Accept less money for the water department or raise rates.=20 State officials need to resolve who they want to see paid PG&E spokesman= =20 John Nelson said. There is a limited pool of money.=20 For his part Davis insisted that the water department would be first in li= ne=20 to be paid and he said the PUC will issue a proposed order to that effect.= =20 We are getting paid before anybody else Davis said.=20 Hundreds of qualifying facilities are out of commission because PG&E and=20 Edison haven't paid them. The situation has robbed the state of several=20 thousand badly needed megawatts and is a key reason blackouts have been=20 ordered. In normal times the facilities produce more than 20 percent of=20 California's electricity.=20 Some of the qualifying facilities have been threatening to haul one or both= =20 of California's beleaguered utilities into bankruptcy court unless they get= =20 paid soon saying a bankruptcy filing might be the only way they can save= =20 their businesses.=20 You've got to take care of the QF problem or the whole thing blacks out= =20 said Jerry Bloom a lawyer representing one group of qualifying facilities.= =20 (State officials) are starting to understand.=20 One thing that was fairly certain about Davis' still-sketchy payment plan: = It=20 wouldn't cover PG&E and Edison's existing debt to the qualifying facilities= =20 estimated at more than $1.48 billion.=20 In their current financial state the utilities say they can't afford to pa= y=20 the existing debt. In addition paying the debt would create a major=20 complication: Other creditors including the big power generators would=20 surely haul Edison and PG&E into bankruptcy court on the grounds that they= =20 weren't being treated fairly.=20 You can't give preferential payment treatment to one class of creditors ov= er=20 another PG&E's Nelson said. You virtually assure that (the other=20 creditors) have to file an involuntary bankruptcy proceeding against you.= =20 But without full payment it wasn't clear how many of the qualifying=20 facilities would be able to restart.=20 Executives at several plants -- the ones that run on natural gas -- said=20 they're not sure their gas suppliers will deliver unless the existing debts= =20 are cleared up.=20 We need to convince a gas company to supply us said Ed Tomeo of UAE Ener= gy=20 Operations Corp. which had to shut off its 40-megawatt Kern County plant= =20 Tuesday. We're a company that already owes millions of dollars for gas=20 supplies. How do you coax them to sell you millions more?=20 It's wishful thinking ... that the gas suppliers are going to sell us gas= =20 Robert Swanson of Ridgewood Power said.=20 I>Bee Capitol Bureau Chief Amy Chance and staff writers Stuart Leavenworth= =20 Bill Lindelof Pamela Martineau and the Associated Press contributed to thi= s=20 report. --- --- Lodi still won't pull the plug By Carrie Peyton Bee Staff Writer=20 (Published March 21 2001) In a growing rebellion against blackouts the city of Lodi has twice refuse= d=20 to cut power to its residents despite an order from Pacific Gas and Electri= c=20 Co.=20 The small city-run electric system is among many disgruntled utilities=20 including the Sacramento Municipal Utility District that believe their=20 contractual pledges to cut back during emergencies were never meant for tim= es=20 like this.=20 It's been a philosophical debate up to this point. Now I guess we've drawn= a=20 line in the sand said Lodi utility director Alan Vallow.=20 PG&E said it is reviewing its interconnection contract the agreement that= =20 links Lodi to the grid through PG&E-owned high-voltage lines to determine= =20 what action it will take next.=20 It's unfortunate that while the city of Lodi has received the benefit of= =20 this agreement for years they are unwilling to bear the burden of this=20 statewide energy shortage said PG&E's Jon Tremayne.=20 One utility coalition the Northern California Power Agency believes that= =20 PG&E has already violated that agreement by not lining up enough power for= =20 customers.=20 The agency wrote PG&E on Friday saying that its members -- municipal=20 utilities and irrigation districts -- believe they aren't required to=20 participate in blackouts prompted by financial disputes.=20 And SMUD which has been considering dropping out of future blackouts will= =20 be watching the response to Lodi said SMUD board President Larry Carr.=20 Some SMUD directors say they're ready to go to court to force the issue. So= =20 is Lodi population 58000 said Vallow.=20 I've heard an Edison executive describe this as a natural disaster akin to= =20 an earthquake. That's crap. This is a man-made event he said.=20 Lodi said it will still help in genuine emergencies such as fires or toppl= ed=20 transmission lines. But it decided that on Monday and Tuesday that wasn't t= he=20 case.=20 You have 3000 megawatts of QFs (qualifying facilities) offline because=20 their bills haven't been paid. Well guess what? Somebody ought to pay thos= e=20 ... bills Vallow said. --- --- Blackouts hit for second day break seen Wednesday=20 By Audrey Cooper ASSOCIATED PRESS=20 March 20 2001=20 SACRAMENTO =01) Rolling blackouts hit California for a second straight day= =20 Tuesday closing souvenir shops in San Francisco's Chinatown snarling=20 traffic and plunging schools and offices around the state into darkness.=20 Roughly a half-million homes and businesses from San Diego to the Oregon=20 border faced outages blamed on the same factors that collided to force=20 blackouts Monday =01) unseasonably warm weather reduced electricity import= s=20 from the Pacific Northwest numerous power plants offline for repairs and= =20 less power provided by cash-strapped alternative-energy plants.=20 Five rounds of outages in San Diego affected about 74000 customers. State= =20 power grid officials expected to have enough electricity to avoid further= =20 outages through at least Wednesday although the supply remained tight.=20 State power regulators working on energy rescue=20 Federal regulators scored for not ordering more California refunds=20 ?=20 Gov. Gray Davis blamed the blackouts in part on the failure of Southern=20 California Edison and Pacific Gas and Electric Co. to pay millions of dolla= rs=20 they owe qualifying facilities power suppliers that use cogeneration =01= )=20 steam from manufacturing plus natural gas =01) or solar wind and other=20 renewable energy to generate electricity.=20 State power grid officials say California this week has lost about half the= =20 electricity QFs normally provide. Several cogeneration plants say they=20 haven't been paid by Edison and PG&E for weeks and can't afford to buy=20 natural gas to fuel their plants.=20 Davis said the utilities are taking in money from customers but still faili= ng=20 to pay the QFs. The state has been spending about $45 million a day since= =20 January to buy power for customers of Edison and PG&E which are so=20 credit-poor that suppliers refuse to sell to them.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators Davis said at a Capitol news conference Tuesday evenin= g.=20 They've acted irresponsibly and immorally and it has to stop.=20 Southern California Edison officials said in a written statement that the= =20 utility is intent on paying creditors and working with the PUC to pay QFs f= or=20 future power sales. PG&E representatives were out of the office late Tuesda= y=20 night and didn't immediately return calls from The Associated Press seeking= =20 comment.=20 John Harrison of the Northwest Power Planning Council a consortium that=20 monitors power use in several Western states said blackouts on the first d= ay=20 of spring are an ominous sign of what lies ahead this summer.=20 We're in trouble he said. We will likely be able to meet our needs this= =20 summer but there won't be much to send to California.=20 Tuesday's outages began at 9:30 a.m. PST and continued in 90-minute waves= =20 until about 2 p.m. when the Independent System Operator lifted its blackou= t=20 order.=20 Grid officials credited an influx of power from the Glen Canyon hydroelectr= ic=20 plant on the Utah-Arizona border.=20 The blackouts were blamed for at least one serious traffic accident.=20 Two cars collided at an intersection without traffic lights in the Los=20 Angeles suburb of South El Monte leaving two people with serious injuries= =20 California Highway Patrol Officer Nick Vite said.=20 Ventura Foods in Industry sent its employees out for an early lunch after= =20 blackouts shut down its phones and computers.=20 This is mild weather for this time of year. I don't know what's going to= =20 happen in the summer manager Frank Hynes said. This is going to have a= =20 serious impact on the state's economy. They can't just keep shutting people= =20 down.=20 Statewide demand was higher than expected because of warm spring weather.= =20 Temperatures reached record highs across California on Monday including th= e=20 80s and low 90s in Southern California. They were expected to be somewhat= =20 lower Tuesday but still in the 70s and 80s.=20 The ISO hoped demand would start to subside and conservation would kick in= =20 but that did not happen Tuesday morning.=20 We have not seen the kind of conservation we saw back in January when th= e=20 first blackouts hit ISO spokesman Patrick Dorinson said. If we don't have= =20 conservation efforts that just means that's more power we have to take off= =20 the grid.=20 In San Francisco's Chinatown souvenir shops normally bustling with visitor= s=20 were forced to shut down. Nearby irritated customers waited for a bank to= =20 reopen.=20 It's no good for anybody =01) stores or businesses or people said Yin Su= n=20 Chan among those in line.=20 PG&E the state's largest utility accounted for most of the customers=20 affected.=20 At least 438000 PG&E residential and business customers were affected as o= f=20 early afternoon spokesman Ron Low said.=20 Edison cut power to about 50000 customers. Edison was ordered to cut less= =20 power than PG&E and saved some due to conservation programs including one= =20 that lets the utility shut off air conditioning for 118500 residential and= =20 business customers when the power supply is tight.=20 About 73400 San Diego Gas & Electric customers were hit by the blackouts.= =20 Los Angeles whose municipal utility is not on the grid that serves most of= =20 California wasn't included in the blackout order.=20 More than 1 million homes and businesses statewide experienced outages=20 Monday.=20 California's power crisis is expected to get even worse this summer when= =20 temperatures soar and residents crank their air conditioning.=20 Natural gas supplies are tight water supplies are down and the state is=20 spending tens of millions of dollars each day to buy electricity for Edison= =20 and PG&E who say they are nearly bankrupt due to high wholesale power cost= s.=20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices the state's 1996 deregulation law=20 prevents them from recouping from ratepayers.=20 Adding to the problems the state this week lost about 3100 megawatts from= =20 QFs. One megawatt is enough power to serve about 750 households.=20 The plants say they are owed about $1 billion for past sales to PG&E and=20 Edison.=20 PG&E said it is offering to prepay the QFs starting next month to get them= =20 back in operation. Negotiations were expected to continue Wednesday.=20 California Co-Generation Council attorney Jerry Bloom said he supports=20 proposals that will get the Qfs paid but the promise of future payments ma= y=20 not be enough.=20 PG&E and Bloom said the utility's prepayments hinge on an upcoming Public= =20 Utilities Commission decision on whether the utility's rates are sufficient= =20 to pay its bills and cover the state's power purchases on its behalf which= =20 amount to $4.2 billion since early January.=20 Davis said the PUC planned to issue a draft order late Tuesday directing th= e=20 utilities to pay their future QF bills.=20 It plans to take action on that order next Tuesday Davis said. The=20 Legislature plans to approve a bill in the meantime giving the PUC the=20 authority to issue such an order and fine the utilities if they fail to=20 comply he said.=20 Davis said he is confident the utilities and the state can pay their bills= =20 without further rate increases for Edison and PG&E customers.=20 --- --- State power regulators working on energy rescue=20 By Karen Gaudette ASSOCIATED PRESS=20 March 20 2001=20 SAN FRANCISCO =01) State power regulators continue to delay the release of= =20 guidelines that will determine a portion of the money the Department of Wat= er=20 Resources can recoup from financially troubled utilities for electricity it= =20 has bought on their customers' behalf.=20 These guidelines will help the water department determine whether it must= =20 raise consumer power rates to reimburse the state for the more than $3=20 billion it has committed to buying electricity.=20 Assemblyman Fred Keeley D-Boulder Creek said Tuesday that the Public=20 Utilities Commission would likely have to raise rates by 15 percent to cove= r=20 the state's costs and the utilities' bills.=20 The PUC guidelines were most recently delayed by a letter from DWR Director= =20 Thomas Hannigan asking that the water department receive a percentage of=20 ratepayer money collected by the utilities equal to the percentage of=20 electricity it provides to utilities.=20 The DWR currently buys around 40 percent of the power used by Pacific Gas a= nd=20 Electric Co. Southern California Edison Co. and San Diego Gas and Electric= .=20 Under the DWR's proposal the utilities would have to hand over 40 percent o= f=20 the money they continue to collect from ratepayers.=20 The DWR would then also receive whatever money remains after the utilities= =20 subtract their own generation and long-term contract costs the letter said= .=20 That amount would become the California Procurement Adjustment =01) an am= ount=20 that will help the state retrieve money spent on power purchases and help= =20 establish the size of state revenue bonds that are currently estimated to= =20 total $10 billion.=20 The state plans to issue the bonds in May to help pay off the more than $3= =20 billion Gov. Gray Davis' administration has committed to power purchases=20 since January to help the utilities climb out of debt.=20 Ron Low a spokesman with PG&E said the utility objects to paying the DWR= =20 such a large sum claiming it would interfere with efforts to pay its=20 qualifying facilities =01) power plants that use the sun wind biomass o= r=20 natural gas to generate about one third of the state's electricity.=20 The nearly bankrupt utilities owe the QFs more than $1 billion for=20 electricity they have produced since November said Jan Smutney-Jones=20 executive director of the Independent Energy Producers.=20 Hannigan also said in the letter the DWR intends to use its authority to=20 raise consumer electricity rates to recoup any money not reimbursed through= =20 the CPA and other means.=20 The Public Utilities Commission expected to release the guidelines last wee= k=20 but was delayed by debates over legislation that would slash the rates of= =20 environmentally friendly power plants under contract to provide electricity= =20 to the investor-owned utilities.=20 Without knowing how much ratepayer money the utilities need to pay these=20 qualifying facilities for future electricity it's unknown how much money= =20 they'll have on hand to pay the DWR.=20 In a written statement PUC Administrative Law Judge Joseph DeUlloa said th= at=20 he would issue a temporary decision on the CPA as soon as is practical.= =20 Pacific Gas and Electric Co. and Southern California Edison Co. say they ha= ve=20 lost more than $13 billion since last June to climbing wholesale electricit= y=20 prices that the state's 1996 deregulation law prevents them from recouping= =20 from ratepayers.=20 --- --- Federal regulators scored for not ordering more California refunds=20 By H. Josef Hebert ASSOCIATED PRESS=20 March 20 2001=20 WASHINGTON =01) House Democrats asked federal energy regulators Tuesday why= they=20 are not going more aggressively after alleged overcharges for wholesale=20 electricity in California and ordering more refunds.=20 The Federal Energy Regulatory Commission has asked suppliers to justify $12= 4=20 million in sales during the first two months of the year or refund the mone= y=20 but critics charge that thousands of additional questionable sales are not= =20 being challenged.=20 The three commissioners testifying at a hearing of the House Commerce=20 subcommittee on energy were asked why they limited their refund demands to= =20 only power sales that occurred during so-called Stage 3 alerts of acute pow= er=20 shortages in California.=20 It appears to me a price is unreasonable when it is unreasonable and not= =20 just during a power alert said Rep. Rick Boucher of Virginia the panels'= =20 ranking Democrat.=20 The commission last week ordered six power generators to justify some 1000= =20 transactions during February in the California market whenever the price wa= s=20 above $430 per megawatt hour and occurred during a Stage 3 emergency alert.= =20 But the lawmakers were told Tuesday that 56 percent of another 14168=20 transactions occurring outside a Stage 3 emergency also exceeded the $430= =20 trigger but are not being questioned.=20 The line was drawn to limit the scope of the refund said agency=20 commissioner William Massey a Democrat who strongly opposed the refund=20 actions because he said they were too limited.=20 Chairman Curtis Hebert a Republican defended the way the commission decid= e=20 on what transactions to challenge saying that it sought to replicate market= =20 conditions as they existed at the time of the sales.=20 We deserve a better explanation retorted Boucher.=20 Massey said that agency's investigation of overcharges for January also=20 failed to consider thousands of transactions that exceeded the refund trigg= er=20 because they did not occur during Stage 3 supply emergencies.=20 Managers of California's electricity grid state regulators and utilities= =20 have accused the agency of refusing to aggressively investigate price gougi= ng=20 by wholesalers who have charged from $150 to $565 per megawatt hour as muc= h=20 as 20 times what prices were in 1999.=20 While Hebert and commissioner Linda Breathitt defended the commissioners=20 attempt to investigate whole electricity prices Massey has been highly=20 critical.=20 What message does the agency's scrutiny of prices send to the power=20 companies? he was asked.=20 It makes clear FERC is going to be looking for the wallet under the lamp= =20 post with the lights shining =01) and nowhere else replied Massey.=20 Meanwhile Massey and his two fellow commissioners also disagreed sharply = on=20 whether the energy agency should impose temporary price controls on the=20 wholesale power market in the West to dampen further expected price increas= es=20 this summer.=20 Massey said he fears a disasters in the making if some price restraints a= re=20 not imposed by FERC which regulates wholesale electricity sales. We need = a=20 temporary time out he said.=20 But Massey is in the minority on the commission. Both Hebert and Breathitt= =20 are against price caps arguing they will have long-term detrimental impact= =20 on power supply.=20 The Bush administration has made its opposition to interfering in the=20 wholesale markets well known for weeks. Vice President Dick Cheney's task= =20 force is to unveil an energy plan in about a month that is expected to lean= =20 heavily on energy production.=20 --- --- Second Day of Blackouts Disrupts 500000 Homes and Businesses=20 Power: Grid operators say the shortage should ease in the next few days bu= t=20 officials see a grim summer.=20 By MITCHELL LANDSBERG and ERIC BAILEY Times Staff Writers=20 A traffic signal that stopped working during Tuesday's rolling blackouts le= d=20 to this collision be tween a car and a truck at an intersection in El Monte= .=20 The outages ran from 9:30 a.m. to 2 p.m. AP ?????Electricity blackouts rolled through California for a second straight= =20 day Tuesday disrupting business in one of the world's most technologically= =20 advanced economies and leaving schoolchildren groping in the dark. ?????Jinxed by a combination of bad luck and bad decisions utilities were= =20 forced to cut off power to more than half a million homes and businesses fr= om=20 San Diego to the Oregon border. ?????By day's end there was some good news from the operators of the=20 statewide power grid who said the situation had eased and appeared likely = to=20 improve for the next few days. And Gov. Gray Davis announced a proposed=20 solution to one vexing problem: the utilities' failure to pay the state's= =20 small alternative power generators many of whom have stopped producing=20 power as a result. ?????Davis called the utilities shameful for failing to pay and praised= =20 the alternative power generators which include solar wind and geothermal= =20 energy producers as good corporate citizens who produced power although= =20 they weren't being paid. ?????We are anxious to pay the [small producers] who are dropping like=20 flies Davis said. ?????Despite the progress it was hard for some people to look on the brigh= t=20 side after enduring outages that took place when the state's hunger for pow= er=20 was almost 50% less than at its summer peak. ?????This is a taste almost like an appetizer of a really unpalatable me= al=20 that's going to be served up this summer said Michael Shames of the Utili= ty=20 Consumers' Action Network in San Diego himself a victim of a rolling=20 blackout that hit his office in San Diego early Tuesday. ?????Power officials have warned that this could be a grim summer in=20 California since demand for electricity sharply rises when people turn on= =20 air conditioners. The state has been struggling to meet its power needs in= =20 recent months because of rising prices and a flawed deregulation plan that= =20 has left the two biggest private utilities on the brink of bankruptcy. Stat= e=20 leaders have so far failed to agree on a comprehensive plan to solve the=20 problems. Wally Quirk teaches a business class in a borrowed classroom Tuesday at=20 Sonoma State after the state's rolling blackouts cut the power to his usual= =20 classroom which does not have any windows. SCOTT MANCHESTER / The Press Democrat ?????The latest round of blackouts began about 9:30 a.m. Tuesday when the= =20 California Independent System Operator which runs the statewide grid=20 determined that the demand for electricity was 500 megawatts more than the= =20 supply--an imbalance that meant the state was short on the power needed to= =20 supply electricity to about 375000 homes. ?????Grid operators blamed a confluence of events including warmer weather= =20 outages at several major power plants including one unit of the San Onofre= =20 nuclear power station a reduction in imports from the Pacific Northwest a= nd=20 the shutdown of many alternative energy producers. Similar blackouts Monday= =20 were the first since January. ?????The situation improved somewhat by late Tuesday morning with some=20 supplies restored and Californians conserving energy and Cal-ISO was able = to=20 halt the rolling blackouts at 2 p.m. ?????Once again customers of the Los Angeles Department of Water and Power= =20 were spared although the municipally owned utility said its electrical=20 surplus was smaller than usual. The DWP like Southern California Edison w= as=20 affected by an outage at the huge Mohave power plant in Nevada as well as = by=20 planned outages at several of its facilities. ?????As in the past by far the biggest impact was felt by customers served= =20 by Pacific Gas & Electric the state's largest utility which cut power to= =20 438000 homes and businesses. ?????Edison cut power to 47462 customers in about 40 cities but eventuall= y=20 was able to avoid blackouts by shutting off the air conditioners of some of= =20 the 118500 customers who participate in a voluntary cutoff program. ?????San Diego Gas & Electric cut power to 73400 customers. ?????Innovative Ways of Coping ?????As on Monday most people took the outages in stride as an annoying b= ut=20 ultimately unavoidable inconvenience. ?????In Palmdale four schools lost power during one of the hourlong=20 blackouts but teachers and students pressed on in the sunlight pouring=20 through windows and skylights. At Barrel Springs Elementary Principal Cruz= =20 Earls said the biggest problem came when students had to go to the bathroom= :=20 Hand in hand they made their way through darkened hallways with flashlight= s. ?????All in all it wasn't a terrible experience. Then again the weather= =20 wasn't that hot Tuesday with a high of 79 in Palmdale so the shutdown of= =20 air conditioners wasn't much of a hardship. I don't want to think about th= e=20 conditions this could create in May or June Earls said. ?????Businesses of all kinds complained about the lack of warning for the= =20 outages--and sometimes found innovative ways to get around the problem. ?????Rattled by news reports of Monday's rolling blackouts El Burrito=20 Mexican Food Products in the city of Industry started its Tuesday shift at = 2=20 a.m. to beat the clock in the event of an outage. That hunch paid off.=20 Workers had just finished cooking and packaging the last batches of salsa a= nd=20 masa when the lights went out at 10:20 a.m. ?????Company owner Mark Roth said the firm will continue working odd hours = to=20 avoid further outages. But he isn't buying the line from the utilities that= =20 they can't provide advance warning because of concerns about looting and=20 rioting. ?????We're ready to do whatever it takes to get through this thing he=20 said. But they've got to give us some notification. ?????At Big O Tires in Elk Grove just south of Sacramento owner Daniel Cr= um=20 had his 14 workers take an early lunch break or head to the warehouse to=20 reorganize the goods. Without electricity they couldn't repair brakes or= =20 align front ends. ?????I'd never let them be idle said Crum. ?????At least two minor traffic accidents were blamed on the outages. ?????The blackouts resulted from a convergence of factors. ?????Demand was slightly higher than expected probably because of=20 unseasonably warm weather. Supplies were tighter than usual in part becaus= e=20 of several outages including that at the Mohave plant half of which was= =20 brought back on line by the end of the day. ?????The San Onofre Nuclear Generating Station was still limping along=20 without power from one of its two 1100-megawatt units which was shut down= =20 Feb. 3 after a half-hour fire in a nonnuclear part of the plant. Edison=20 which operates San Onofre initially estimated the unit would be out for=20 several weeks but recently said extensive damage to parts of the turbine= =20 will keep the unit out of commission until mid-June. ?????Shipments from the drought-stricken Pacific Northwest which generates= =20 most of its electricity from large dams were also down. ?????Each time we take a measurement we're closer to the all-time record= =20 for the driest year said Dulcy Mahar spokeswoman for the Bonneville Powe= r=20 Administration the network of federal dams that provides the region with= =20 much of its electricity. We've been doing what we can but we simply don't= =20 have power to sell. ?????Finally there was the problem of the small and alternative energy=20 producers which have shut down plants because they haven't been paid by th= e=20 private utilities since November. Those outages have cost the state about= =20 3000 megawatts of electricity enough for about 2.3 million homes. ?????You're seeing the system freeze up said David Sokol chairman and C= EO=20 of MidAmerican Energy Holdings Co. which runs eight geothermal plants in t= he=20 Imperial Valley through its subsidiary CalEnergy. His company hasn't shut= =20 down yet but Sokol said smaller companies couldn't continue to sell their= =20 energy to utilities for free. ?????Why should we fund Edison? he asked. That's just ridiculous. ?????A Choice of 2 Rate Plans ?????Davis joined lawmakers in the Capitol on Tuesday to outline his plan t= o=20 get the producers running again. He said utilities have had no right to=20 collect money from ratepayers and then not use the funds to repay the small= =20 producers. The state has spent billions to buy power from large conventiona= l=20 producers on behalf of the utilities but has refused to pick up the tab for= =20 alternative energy. ?????The utilities acted in a shameful manner by putting money in their=20 pockets that was designed to pay the [small producers] Davis said. ?????The plan outlined by Davis would allow the generators to choose betwee= n=20 two rate plans. They could decide to be paid 7.9 cents per kilowatt-hour ov= er=20 five years or 6.9 cents a kilowatt-hour over 10 years. ?????The utilities must begin paying the generators the new rates beginning= =20 April 1 or face fines Davis said. ?????The question of how the companies will get paid the about $1.5 billion= =20 they are owed remains unresolved. That issue will be decided in coming week= s=20 as Davis' negotiators continue to work on rescue plans for the state's=20 financially hobbled private utilities. ?????PG&E spokesman Ron Low said the state's largest utility did not take= =20 kindly to Davis' criticism and noted that the governor's plan is similar t= o=20 a proposal that PG&E made last week to producers. ?????Jan Smutny-Jones executive director of a trade group that includes so= me=20 of the small generators described the plan as a positive step. ?????The governor got it right in that it's not acceptable for small power= =20 producers to continue to generate and not be paid Smutny-Jones said. But= =20 we'll need to see what the order says the devil will truly be in the=20 details. ?????Grid operators said the state's overall energy situation eased by midd= ay=20 Tuesday because of repairs at the Mohave plant and another large plant at= =20 Ormond Beach and because the Western Area Power Administration came up wit= h=20 300 megawatts of electricity from Glen Canyon Dam. ?????Also grid spokesman Patrick Dorinson said conservation savings spiked= =20 upward after earlier complaints that Californians weren't conserving. ?????We saw the people of California probably conserve 900 megawatts today= =20 he said. That was probably the difference. ---=20 ?????Times staff writers Andrew Blankstein Jose Cardenas Marla Dickerson= =20 Noaki Schwartz Nicholas Riccardi Doug Smith Rebecca Trounson and Richard= =20 Winton in Los Angeles Miguel Bustillo and Julie Tamaki in Sacramento Mari= a=20 La Ganga in San Francisco Stanley Allison Matt Ebnet Scott Martelle=20 Dennis McLellan Monte Morin Jason Song Mai Tran and Nancy Wride in Orang= e=20 County and Richard Simon in Washington contributed to this story. --- --- Fragile Supply Network Apt to Fail=20 By JENIFER WARREN and ERIC BAILEY Times Staff Writers=20 ?????A lot of people were caught off guard by the blackouts that swept over= =20 California this week. Debra Bowen wasn't one of them. ?????As chairwoman of the state Senate Energy Committee she is=20 intimately--and painfully--familiar with the state's energy supply. And she= =20 is willing to share a secret: It's a fragile system capable of collapse at= =20 any time. ?????That knowledge keeps Bowen awake at night particularly with the=20 approach of summer when power demand surges as Californians get reacquaint= ed=20 with their air conditioners. ?????I sound a bit less like Chicken Little today don't I? Bowen said=20 Tuesday as chunks of the state once again were forcibly darkened. I know = a=20 lot of people don't feel we have a problem. But we have a very very big=20 problem. ?????With the recent slowdown in Stage 3 emergencies a sense of calm had= =20 settled over the energy debate and even some legislators were speaking wit= h=20 guarded optimism about the hot months ahead. ?????On Tuesday however a creeping sense of doom was almost palpable amon= g=20 energy watchers and previous supply forecasts--which predict that the stat= e=20 may yet escape summer blackouts--were being given a second look. ?????The outages of the last two days are something that Californians are= =20 going to have to get used to for July and August said Michael Zenker=20 California director of Cambridge Energy Research Associates. The=20 Massachusetts consulting firm is predicting about 20 hours of blackouts thi= s=20 summer. ?????At the California Independent System Operator which manages 75% of th= e=20 statewide power grid officials said the energy cushion the state had in=20 recent weeks was in some ways a phantom caused by heavy imports of power. ?????Cal-ISO spokesman Patrick Dorinson said people may have been deluded= =20 into a false state of comfort: Maybe there is a tendency to think things= =20 have improved he said. In fact they haven't. ?????More than anything this week's events illustrate the delicate balance= =20 of factors that keep California illuminated from the multitude of supply= =20 sources to the weather. ?????Temperatures were higher than usual. Alternative-energy suppliers--who= =20 haven't been paid in months by the cash-strapped utilities--cut their outpu= t.=20 Suppliers in the Northwest--which faces a drought--slashed exports. Equipme= nt=20 breakdowns and maintenance at power plants--much of it unanticipated--took= =20 13000 megawatts offline. A utility-run program that gives businesses=20 discounts in exchange for cutting power during emergencies is all but dead. ?????The fragility of the system is such that a small perturbation can tur= n=20 everything upside down very easily said Gary Ackerman executive director= =20 of the Western Power Trading Forum a group of electricity generators and= =20 traders. ?????One factor receiving particular attention is the dip in supply caused = by=20 unscheduled maintenance. To help officials predict available supply=20 generators provide an annual maintenance plan that is updated regularly. ?????In addition however facilities sometimes shut down for unexpected=20 reasons: leaking tubes burnt-out transformers cracked turbines and faulty= =20 feed pumps. At one point Tuesday about 8200 megawatts were unavailable=20 because of unscheduled shutdowns. That's enough to supply about 6 million= =20 households and up from 5700 megawatts a week ago. ?????The huge 1400-megawatt Mohave power plant near Laughlin Nev. which= =20 supplies Southern California Edison and the Los Angeles Department of Water= =20 and Power was felled Monday by a transformer problem. That was enough to= =20 push the state into blackouts. ?????A growing number of skeptics however question whether those reasons= =20 are always valid accusing generators of withholding power to shrink supply= =20 and drive up prices. ?????There's no way to verify it so you've got to take their word for it= =20 said Frank Wolak a Stanford University economist who studies California's= =20 electricity market. And given that it's very profitable for these things t= o=20 occur you start to wonder if they're creating an artificial scarcity. ?????Tom Williams of Duke Energy said the Houston-based company is working= =20 hard to keep its California power plants which are capable of producing=20 3351 megawatts of electricity in operation after months of near-continuou= s=20 operation. ?????It's like riding a moped across the country he said. They're just= =20 not meant to run this hard. ?????Last week the state Senate formed a committee to investigate charges = of=20 market manipulation by power suppliers. The chairman state Sen. Joe Dunn= =20 (D-Santa Ana) says the issue of unscheduled plant shutdowns is on his agen= da. ?????The problem is: How does one prove that a particular outage was part = of=20 a deliberate strategy to deprive the state of kilowatts rather than a resu= lt=20 of normal business operations? Dunn said. ---=20 ?????Times staff writer Nancy Rivera Brooks contributed to this story. --- --- Elevator Anxiety Is Riding High=20 Emergencies: Workers in skyscrapers worry about blackouts trapping them in= =20 their buildings. Some take the risk in stride others make plans to take th= e=20 stairs.=20 By JOHN M. GLIONNA and JOE MOZINGO Times Staff Writers=20 ?????SAN FRANCISCO--In Susan Clifton's highly placed opinion sunny Tuesday= =20 would have been a picture-perfect day to work atop one of the tallest=20 buildings in San Francisco a scenic city littered with soaring skyscrapers= . ?????But Clifton--like many other high-rise office dwellers in blackout-pro= ne=20 parts of California--couldn't help but feel some high anxiety at the prospe= ct=20 of being stranded by electrical outages that were sweeping across the state= =20 for a second day. ?????I think about it all the time said Clifton a 21-year-old=20 receptionist at Deutsche Bank's offices on the 48th floor of a tower in the= =20 city's financial district who recently moved from rural Virginia. The way = I=20 see it Californians take a lot of things on faith working atop tall=20 buildings with all these earthquakes and power outages. ?????For Long Beach office worker Dave Suhada the anxiety has taken the fo= rm=20 of elevator phobia: a fear of getting stuck on an 80-degree day crammed in = a=20 pod of sweating heavy-breathing humans with no way out. ?????I'm just eyeing the buttons to see which one I could push as fast as = I=20 can if the power goes out he said.=20 ?????For 20-year-old Lisa Riley it means entering the elevator each day in= =20 her Long Beach office building with a prayer. I just could not get stuck f= or=20 an hour and a half she said nodding nervously. Often she now opts for th= e=20 stairs. ?????In San Francisco emergency services officials say that most of the=20 city's office buildings are equipped with backup generators to run elevator= s=20 and security equipment in the event of a blackout. ?????Fire Department spokesman Pete House said the city has 19 trucks with= =20 experts trained to extricate people trapped in elevators. Firefighters=20 handling blackout-related emergencies rescued a person trapped in a downtow= n=20 building Tuesday and handled five elevator mishaps Monday. ?????Christopher Stafford didn't get caught inside an elevator Monday but= =20 suffered the next-worst thing: being stranded in his 15th-floor apartment= =20 after the power failed when he went home for lunch. ?????So the 41-year-old real estate worker trooped down the stairs to the= =20 lobby and even made some new friends along the way helping a few elderly= =20 women who were struggling down the stairs. ?????It was a pain he acknowledged. But I have to tell you: I really li= ke=20 my panoramic view so it's worth the hassle. ?????Nowadays Sherrie Tellier makes sure her cellular phone is in hand whe= n=20 she gets in the elevator. She got trapped once before and the emergency=20 phone didn't work. It's amazing she said how small an elevator seems when= =20 you can't get out. It's like a broom closet.Now there's a sigh of relief= =20 every time the door opens. ?????Some high-rise office workers said Tuesday that they preferred not to= =20 think about the perils of going without power and being vulnerable and=20 isolated so high up. ?????But on the 42nd floor of San Francisco's Transamerica Tower Sasha=20 Monpere wasn't fazed by the chance that during a blackout her building's= =20 backup generators wouldn't kick in. ?????Hey I'm young and I'm healthy. I can always walk down the stairs= =20 said the 29-year-old receptionist. I've done the Statue of Liberty. It can= 't=20 be any worse than that. And walking down 42 flights is a lot easier than=20 walking up all those stairs. ?????Likewise with Phil Ip who works on the 52nd--and top--floor of San=20 Francisco's tallest skyscraper. The 25-year restaurant veteran says he has= =20 the utmost faith in modern technology. ?????We're safe even up here said Ip assistant general manager of the= =20 Carnelian Room a restaurant atop the Bank of America building. You should= =20 see the engineer's room in this building. It's like a big steamship. They'r= e=20 equipped for anything that could happen. ?????One floor below Cheryl Martin hears every day about people's fear of= =20 heights. In the year since she began answering phones in a law office she= =20 has often escorted clients afraid of express elevators that shudder and ris= e=20 so fast that passengers' ears pop from the altitude gain. ?????Everybody and I mean everybody asks 'So what happens during a pow= er=20 outage?' she said. ?????Rory Thompson said he believes in karma and is sure that if the rollin= g=20 blackouts come calling his office will be spared. In July 1993 Thompson's= =20 building was the site of an incident known as the 101 California St.=20 massacre in which gunman Gian Luigi Ferri killed eight people and wounded= =20 six before killing himself. ?????This building has already had its bad day he said. They say that t= he=20 day after a crash is the safest day to ride an airline. So I'll take my=20 chances with the rolling blackouts. --- State Says It's Accelerating Plan to Buy Power Utilities' Grid=20 Government: Talks with Edison are reported near completion but agreement= =20 with heavily indebted PG&E has a way to go.=20 By RONE TEMPEST and DAN MORAIN Times Staff Writers=20 ?????SACRAMENTO--As blackouts hit California for a second day Tuesday a ke= y=20 consultant to Gov. Gray Davis said negotiations to buy the power grid owned= =20 by the state's largest utilities are proceeding at an accelerated pace. ?????Wall Street consultant Joseph Fichera said talks with Southern=20 California Edison could be wrapped up within days although those with PG&E= =20 are much less advanced.=20 ?????The administration and PG&E have not reached even an agreement in=20 principle he said. PG&E which has more debt than Edison says its=20 transmission lines are more extensive than those of its Southern California= =20 counterpart. ?????The state wants to buy the utilities' transmission lines and other=20 assets for about $7 billion to provide cash to the utilities help stabiliz= e=20 the electricity supply and ease the power crunch that has plagued Californi= a=20 for months. To research the grid purchase Fichera said the state has had = to=20 pore over 80000 documents just to assess the utilities' liabilities. ?????We are working at a good pace said Fichera chief executive of the= =20 New York firm Saber Partners. . . . If we get to a deal-breaker it might= =20 be longer. ?????By making Fichera who is also a consultant to the Texas Public=20 Utilities Commission available to reporters Tuesday the Davis=20 administration was clearly trying to reassure the public that progress is= =20 being made on the governor's plan to pull the state out of the crisis. ?????Since mid-January when the big utilities' credit failed and suppliers= =20 stopped selling to them the state has spent nearly $3 billion buying=20 electricity from a handful of large suppliers in Texas Oklahoma Georgia a= nd=20 North Carolina. Not a cent has gone to the hundreds of alternative energy= =20 suppliers in California who provide about a quarter of the state's=20 electricity. ?????The Monday and Tuesday blackouts occurred partly because many of the= =20 cash-strapped alternative suppliers including solar biomass and wind powe= r=20 units cut their normal supply to the system in half. They say Edison and= =20 PG&E have not paid them since November the utilities say they are out of= =20 cash. ?????Assemblyman Fred Keeley (D-Boulder Creek) said the plight of the=20 alternative suppliers has dragged on because of the complexity of dealing= =20 with almost 700 individual contractors. ?????Another delaying factor said Keeley who with state Sen. Jim Battin= =20 (R-La Quinta) worked for almost three months to come up with a legislative= =20 plan to lower the small producers' prices was the huge enmity . . .=20 manifested between the utilities and the qualifying facilities. These peopl= e=20 just don't like each other. ?????This week's blackouts provided two painful lessons for the Davis=20 administration: ?????* When it comes to electricity size doesn't matter--every kilowatt=20 counts. During peak use a small wind power facility in Riverside County ca= n=20 make the difference between full power and blackouts. ?????* There is no such thing as a partial solution. Unless the whole energ= y=20 equation is balanced the parts don't work. ?????For the Davis plan to work several key elements need to come together= =20 or utility customers will almost certainly face rate increases above the 19= %=20 already set in motion: ?????* The cost of power purchased by the state must be reduced through=20 long-term contracts with the big out-of-state producers. ?????These contracts the details of which the Davis administration has kep= t=20 confidential are still being negotiated by Davis consultant Vikram Budhraj= a=20 of the Pasadena firm Electric Power Group. The administration says it has= =20 concluded 40 contracts with generators about half of which have been signe= d. ?????According to the most recent statistics released by the Department of= =20 Water Resources which buys power for the state current prices are still= =20 well above the rate state Treasurer Phil Angelides says is necessary for a= =20 planned $10-billion bond offering to succeed. ?????The bonds set for sale in May will be used to reimburse the state fo= r=20 the money it will have spent by that time to buy electricity. The state is= =20 currently spending at a rate of $58 million a day to buy power. If prices= =20 stay high the $10 billion in bonds will not cover the state's power=20 purchases by the end of the summer. ?????Angelides says he cannot proceed with bridge financing for the bonds= =20 until the Public Utilities Commission devises a formula to guarantee that a= =20 portion of utility bills will be dedicated to bond repayment. Angelides has= =20 estimated that under the January law that put the state in the power buyin= g=20 business the state must be reimbursed $2.5 billion annually and that $1.3= =20 billion is needed to service the debt. ?????PUC Administrative Law Judge Joseph R. DeUlloa is expected to announce= =20 his ruling on the reimbursement rate later this week leading to a PUC vote= =20 on the matter as early as next week. ?????* The rates charged for electricity by the alternative producers know= n=20 as qualifying facilities must be cut at least in half down from an averag= e=20 of more than 17 cents per kilowatt-hour. In his news conference Tuesday=20 Davis said he will ask the PUC to set QF rates at 6.9 cents for 10-year=20 contracts and 7.5 cents for five-year contracts. ?????Meanwhile PUC Chairman Loretta Lynch a Davis appointee said Tuesday= =20 that the commission will vote next week on a proposed order requiring=20 Southern California Edison and Pacific Gas & Electric to pay the QFs for=20 electricity in the future. Lynch said a recent PUC assessment showed that t= he=20 utilities have enough cash on hand for that. ?????We are trying to make sure the folks providing the power get paid= =20 Lynch said. The qualified facilities have demonstrated that they haven't= =20 been paid and that it is impairing their ability to provide power. ?????The utilities contend that if they pay the small providers what they o= we=20 them there will not be enough money left to pay other creditors. ?????There is not enough money in the current rate structure to pay the=20 [alternative producers] pay the [Department of Water Resources] and pay th= e=20 utilities for their generation said John Nelson a spokesman for PG&E. ?????* The utilities must sell to the state the power they produce=20 themselves mainly from hydro and nuclear sources at a rate only slightly= =20 above the cost of producing it. This is tied to the ongoing negotiations=20 between the Davis administration and the utilities to restore the=20 near-bankrupt utilities to solvency. ---=20 ?????Times staff writers Julie Tamaki Miguel Bustillo and Tim Reiterman=20 contributed to this report. --- L.A. Long Beach File Suits Over Gas Companies' Prices=20 Energy: Separate actions allege a conspiracy and gouging. Suppliers blame= =20 rising demand and a fluctuating market.=20 By TINA DAUNT and DAN WEIKEL Times Staff Writers=20 ?????Seeking damages that could reach into the billions of dollars the= =20 cities of Los Angeles and Long Beach on Tuesday filed separate lawsuits=20 alleging that a coalition of gas companies illegally conspired to eliminate= =20 competition drive up natural gas prices and discourage the construction of= =20 electricity generating plants in California. ?????Officials from the two cities alleged that Southern California Gas Co.= =20 San Diego Gas & Electric and El Paso Natural Gas Co. violated the state's= =20 antitrust law and engaged in unfair and fraudulent business practices that= =20 caused gas prices to skyrocket. ?????The cities are the first California municipalities to take action=20 against the gas companies. A number of similar lawsuits filed by antitrust= =20 attorneys state regulators and private citizens are pending elsewhere. ?????The energy companies deny any impropriety. They contend that Californi= a=20 is the victim of its own soaring electricity demand and overreliance on=20 fluctuating spot markets for natural gas. ?????The conspiracy theories that have been promoted have no basis in=20 reality said Denise King spokeswoman for Southern California Gas' parent= =20 company Sempra Energy which also was named in the suits. Southern=20 California Gas continues to look out for the best interest of its customers= . ?????The lawsuits filed in Los Angeles County Superior Court accuse the=20 companies of conspiring to manipulate the price of natural gas by agreeing = to=20 kill pipeline projects that would have brought ample supplies of cheaper=20 natural gas to Southern California. ?????They allege that executives for the energy companies made the pact=20 during a meeting in a Phoenix hotel room five years ago to discuss=20 opportunities arising from the state's newly deregulated electricity mark= et. ?????The fulfillment of the illicit plan has had devastating effects on=20 Southern California gas consumers according to Los Angeles' suit. Gas=20 prices in the Southern California market have skyrocketed and the Southern= =20 California gas consumers are paying the highest prices in the nation. ?????In recent months natural gas prices have tripled across the nation fo= r=20 a number of reasons including a shortage of supplies to meet demands for= =20 home heating. Prices have increased far more in California where natural g= as=20 is a central factor in the state's energy crisis. The state relies on the= =20 clean-burning fuel to generate half its electrical power. ?????This not only led to price-gouging of all natural gas consumers from= =20 homeowners to government to industry but it contributed to the current=20 electrical power crisis in California said City Atty. James K. Hahn a=20 mayoral candidate who urged the City Council to pursue the case. ?????Chris Garner Long Beach's utility director said that since November= =20 the average residential bill for gas in Long Beach has more than doubled t= o=20 $175 a month. Some customers he said have seen rate increases of 500%. ?????The people of Long Beach are being gouged by energy conglomerates who= =20 are artificially manipulating the supply of natural gas and reaping excess= =20 profits at the expense of the public said City Attorney Robert Shannon. ?????Holding a special meeting the Los Angeles City Council voted 12 to 0= =20 Tuesday to file the suit. ?????If the allegations are true they are extremely serious said=20 Councilman Mike Feuer who is a candidate to succeed Hahn as city attorney.= =20 And there appears to be some important evidence that substantiates the=20 allegations in the complaint which means that this lawsuit is I think mo= re=20 than a viable lawsuit. ?????Councilman Mark Ridley-Thomas added: We cannot tolerate this and we= =20 must use the full weight of the law to try to correct it. ?????A growing number of lawsuits around the state are targeting California= 's=20 natural gas suppliers. El Paso Corp. which owns the main pipeline=20 transporting out-of-state gas to Southern California has been targeted=20 repeatedly by utility companies state regulators and antitrust attorneys.= =20 ?????Some of the first antitrust lawsuits were filed against Sempra Energy = in=20 December. They were brought by Continental Forge Co. a Compton-based=20 aluminum forging business and Andrew and Andrea Berg who own a business i= n=20 San Diego. ?????The cities' lawsuits request that the defendant companies be barred fr= om=20 such conduct in the future and they seek civil penalties and damages. ?????Shannon estimates that Long Beach could collect more than $100 million= =20 in damages including triple penalties for antitrust violations. ?????We are filing this for our citizens Shannon said. They include the= =20 poor the elderly people living on fixed incomes and small business owners= . ?????The Los Angeles suit was filed on behalf of all Californians. Official= s=20 place damage estimates in the billions.=20 ?????Hahn however warned council members that it could take the city a ye= ar=20 or more to resolve the suit. ?????Lawsuits take time Hahn said. We are hopeful we can enter into=20 meaningful discovery to disclose what's been going on. --- Davis OKs Subsidy of Pollution Fees=20 Smog: As part of secret deal to get long-term energy contracts state would= =20 pay for some of the credits that allow excess power plant emissions. Critic= s=20 renew call for full disclosure.=20 By DAN MORAIN Times Staff Writer=20 ?????SACRAMENTO--As part of his closed-door negotiations to buy electricity= =20 Gov. Gray Davis has agreed to relieve some generators from having to pay=20 potentially millions of dollars in fees for emitting pollutants into the ai= r=20 Davis said Tuesday. ?????Davis announced two weeks ago that his negotiators had reached deals= =20 with 20 generators to supply $43 billion worth of power during the next 10= =20 years. ?????However the Democratic governor has refused to release any of the=20 contracts or detail various terms contending that release of such=20 information would hamper the state's ability to negotiate deals with other= =20 generators and therefore ultimately would raise prices Californians pay for= =20 electricity. ?????Sources familiar with the negotiations speaking on condition of=20 anonymity said the agreement reached with Dynegy Inc. a power company bas= ed=20 in Houston is one that includes language requiring that the state pay the= =20 cost of credits that allow emissions. Dynegy spokesman Steve Stengel declin= ed=20 to discuss the company's deal with the state. ?????We couldn't get them to sign contracts it was a sticking point Dav= is=20 said of the decision to pay the fees of some generators. We had to lock do= wn=20 some power so we were not totally dependent on the spot market. ?????The fees in question are part of an emission trading system known as= =20 RECLAIM. Under the system companies are allotted a certain amount of=20 allowable pollution. If their operations pollute more companies are requir= ed=20 to purchase credits on an open market. Currently the credits cost about $45= =20 per pound of pollution--an amount that can lead to a bill of well over $10= =20 million a year for a power plant. ?????The South Coast Air Quality Management District which regulates=20 pollution in the Los Angeles Basin is considering steps to significantly= =20 lower the cost of the system--a step that could considerably cut the state'= s=20 potential cost Davis said. ?????Senate Energy Committee Chairwoman Debra Bowen (D-Marina del Rey)=20 defended the decision to cover the power company's costs. ?????It is a question of whether it brings down the price of power she= =20 said. If it brings down the price of power I don't have a problem with it= . ?????Nevertheless word that the contracts could bind the state to pay=20 pollution fees caused some critics of Davis' policy to renew calls for Davi= s=20 to reconsider the secrecy surrounding the power negotiations. The payment= =20 provision underscores the fact that the contracts involve more than merely= =20 the prices the state will pay for its megawatts the critics note. ?????The Legislature should have known about it said Senate President Pr= o=20 Tem John Burton (D-San Francisco). It is going to cost taxpayers money. It= =20 makes you wonder. . . . This was a policy issue that was never discussed wi= th=20 the Legislature. ?????V. John White a lobbyist for the Sierra Club who also represents=20 alternative energy producers called the contract proposal a horrible=20 precedent. ?????Until we know exactly what the state has agreed to and how much of a= =20 subsidy this represents we can't determine how serious the breach of=20 principle this is White said. ?????Another critic of the secrecy of the negotiations Terry Francke=20 general counsel for the California First Amendment Coalition said the=20 provision in question raises the possibility that there are other=20 [concessions] that have not yet come to light. ?????In the summer when demand for power is highest some generators=20 probably will exceed pollution limits set by regional air quality managemen= t=20 districts. ?????To avert blackouts state officials might ask the companies to keep=20 plants running. In such cases some sources familiar with aspects of the=20 contracts said the contract language could be interpreted to suggest that= =20 the state would cover any fines--although Davis said Tuesday the state will= =20 not cover the cost of fines. ?????A recent Dynegy filing with the Securities and Exchange Commission=20 underscores the rising cost of pollution-related measures. The company whi= ch=20 is partners with NRG Energy in three California plants in El Segundo Long= =20 Beach and Carlsbad in San Diego County said its aggregate expenditures fo= r=20 compliance with laws related to the regulation of discharge of materials in= to=20 the environment rose to $14.3 million in 2000 from $3.6 million in 1999. ?????A South Coast Air Quality Management spokesman said Dynegy's facilitie= s=20 appear to be fairly clean--although Sierra Club lobbyist White said Dynegy= =20 has been seeking a permit at one of its plants to burn fuel oil which is= =20 dirtier than natural gas. ?????Davis said he intends to make this information public but he added= =20 that we do not want to put the public's interest in jeopardy by asking the= m=20 to pay higher prices. ?????Nobody likes the notion that [the administration is] not being fully= =20 forthcoming Davis said. But I also have a corollary responsibility that = I=20 don't stick these generators with a higher rate. --- As Losses Mount Companies Work Around Outages=20 By MARLA DICKERSONJERRY HIRSCH and NANCY CLEELAND Times Staff Writers=20 ?????As blackouts moved from theory to reality many Southern California=20 businesses spent Day 2 assessing their losses and digging in for what they= =20 expect to be a long hot summer. ?????An hour without electricity may be an inconvenience for most residents= .=20 But for manufacturers and many other businesses even a brief loss of power= =20 can generate tens of thousands in losses. ?????Whether shaping metal or making salsa businesses of all kinds=20 complained Tuesday about the lack of warning of impending outages even as= =20 they sought sometimes creative ways to work around the loss of power. ?????Rattled by news reports of Monday's rolling blackouts Industry-based = El=20 Burrito Mexican Food Products started its Tuesday shift at 2 a.m. Workers h= ad=20 just finished cooking and packaging the last batches of salsa and masa when= =20 the lights went out at 10:20 a.m. ?????We dodged a bullet said El Burrito founder Mark Roth. Losing a day= 's=20 production of salsa would have cost me $15000 to $20000. ?????But other companies weren't so fortunate. ?????Long Beach-based Delco Machine & Gear was still totaling up its losses= =20 from Monday's blackout which amounted to at least $30000 in lost wages an= d=20 production said Nick Campanelli vice president of manufacturing. The=20 company a division of Florida-based B/E Aerospace Inc. makes parts for th= e=20 aerospace industry. The sudden loss of power caused its sophisticated metal= =20 cutting and grinding machines to crash ruining precision parts in producti= on. ?????But the losses don't end there. He said employees will need to spend= =20 hours resetting the equipment. Campanelli is particularly irked that the=20 company received no warning. ?????Five minutes' notice he fumed. That's all I needed. ?????Although businesses such as Campanelli's typically receive no warning= =20 that they are about to lose power insurance companies count the rolling=20 blackouts as planned events a determination that in most cases=20 disqualifies a business from making a claim. ?????I know it must be frustrating for businesses who have the power go of= f=20 suddenly but these outages are planned by the grid operators said Pete= =20 Moraga of the Insurance Information Network of California. That means it= =20 would not be a covered peril in a traditional business insurance policy. ?????Typically business insurance covers loss of profit and damage from=20 unforeseen events such as fires or windstorms. The component of the policy= =20 that covers interruptions in business kicks in after a given amount of time= =20 elapses usually 24 to 48 hours. ?????Business polices can be written to include unusual coverages Moraga= =20 said but he has never heard of a policy that covers losses from a rolling= =20 blackout. ?????Some companies are taking measures not to get caught in a situation=20 where a blackout can hurt them. ?????The region's largest steel supplier shut down for two hours Monday aft= er=20 Southern California Edison called to warn of tight supplies. ?????We just can't take a chance said Lourenco Goncalvez president of= =20 California Steel Industries Inc. in San Bernardino County. We have a lot o= f=20 safety issues. People could get hurt. ?????Goncalvez said the plant has multiple 20-ton and 25-ton overhead crane= s=20 that operate with electromagnetic devices which would fail if they lost=20 power suddenly. Falling materials could injure workers below he said. We= =20 have been asking to be exempt from rolling blackouts he said. ?????Goncalvez said he couldn't put a price on the lost production at the= =20 24-hour plant and said he worried more about the long term. ?????Two hours is nothing he said. My concern is this thing will start = to=20 happen almost every day. If it will be like this all summer you can be sur= e=20 it will have dramatic consequences for the entire economy. . . . We're goin= g=20 to have a shortage of steel products in California. Maybe the government do= es=20 not consider this is serious. We'll see. ?????At Sport Chalet a La Canada Flintridge-based chain of 22 sporting goo= ds=20 stores in Southern California an administrative assistant monitors the sta= te=20 power situation hoping to warn any stores that are in danger of losing=20 power said Craig Levra the company's chief executive. ?????Levra said the assistant was assigned the monitoring duties last year= =20 when rolling blackouts were still only a threat. ?????The chain put in place an emergency plan--similar to what it would do = in=20 a major earthquake. Backup power will kick on emergency lights and allow th= e=20 cash registers to complete transactions. Employees are instructed to escort= =20 customers from the building safely Levra said. ?????Other businesses however have plans to remain open during the 60- to= =20 90-minute blackouts. ?????When power went out at two Cheesecake Factory restaurants in Orange=20 County on Monday afternoon the eateries switched to serving cold dishes su= ch=20 as sandwiches and salads said Howard Gordon senior vice president of the= =20 Calabasas Hills-based chain. ?????The restaurants had enough backup power to operate emergency lights an= d=20 cash registers. Large windows provided the rest of the light Gordon said. ?????So far the 99 Cents Only Stores chain has missed the shotgun pattern = of=20 the blackouts. But with nearly 100 stores in California company President= =20 Eric Schiffer believes it is only a matter of time before the lights go out= =20 at one of its outlets. ?????Though the stores have some backup power the chain has systems in pla= ce=20 to operate without it. Its cash registers can open mechanically Schiffer= =20 said. Because an item sells for a multiple of 99 cents sales clerks are=20 equipped with blackout sheets that calculate a customer's tab including= =20 tax. All the clerk has to do is count the number of items in the shopping= =20 cart and check the tables on the sheet. ?????This week's power crunch has been exacerbated by the fact that so-call= ed=20 interruptible electricity customers no longer face large penalties if they= =20 decline to shut down their operations when supplies get critically low. ?????The Public Utilities Commission suspended the fines in January to ease= =20 the burden on about 1400 businesses that found themselves bearing the brun= t=20 of the crisis to prevent rolling blackouts in the rest of the state. ?????According to Edison about 10% of its interruptible customers are=20 complying with requests to curtail electricity usage during crunch time. Bu= t=20 Scott Keller isn't among them. ?????The owner of Chino-based STC Plastics Inc. said he was forced to shut= =20 down more than 20 times since September costing him as much as $10000 in= =20 lost production per day. He ignored requests Monday and Tuesday to curtail= =20 usage and said he doesn't feel a twinge of remorse. ?????If I'm shut down I can't pay my workers he said. I'd feel more=20 guilty about that. ?????But this is one area where insurance eventually might help. Moraga sai= d=20 some carriers are developing plans that would cover penalties for continuin= g=20 to use power after they have been asked by a utility to cut back. --- Wednesday March 21 2001=20 A Blackout on Answers=20 Davis needs to do a better job in communicating to Californians about the= =20 electricity crisis. In the absence of that cynicism grows.=20 ?????The oil shocks of the 1970s from the Arab oil embargo to the Iran-Ira= q=20 war were dead simple compared with the California power shortage. Then th= e=20 problem was a lack of imported oil and the chief symptom was long lines and= =20 high prices at gas stations. Politicians urged conservation: Turn down the= =20 heat drive fewer miles buy more efficient cars. People understood the cau= se=20 of the crisis and the benefit of their actions. Today it's a different stor= y=20 and a damnably complicated one that gives consumers no place--or actually= =20 too many places--to focus their anger.=20 ?????The last two days of rolling blackouts including previously exempt=20 Southern California have not reduced power demand or at least not enough.= =20 Consumers are suspicious: Are out-of-state power companies holding back=20 production? Did utilities really not have enough money to pay alternative= =20 energy producers--the little guys who combined could produce enough power= =20 to prevent the blackouts? And what happened to long-term power contracts t= he=20 state-bargained deal that was supposed to stabilize the crisis?=20 ?????The frustrations are vast and there are too many gaps in the story. I= f=20 it's just a pack of thieves creating an artificial shortage as even some= =20 consumer organizations charge why should anyone sacrifice to conserve? Tha= t=20 in a nutshell is the problem that Gov. Gray Davis the state Legislature a= nd=20 the Public Utilities Commission face.=20 ?????Davis for one has to level with the public and stop acting as if he= =20 can fix the crisis. He has proved he can't at least not without reductions= =20 in usage and most likely rate increases. If Davis who is notoriously=20 averse to delivering bad news had leveled with the public about the=20 fragility of the current system the last two days of blackouts statewide= =20 (except in places with full municipal power like Los Angeles) might not ha= ve=20 come as such a shock.=20 ?????The Legislature tried and failed earlier to solve the alternative ener= gy=20 producers' nonpayment problems with a very complicated bill. Tuesday night= =20 Davis and legislators announced a simpler plan that would set lower more= =20 flexible rates for alternative power but also force the utilities to pay fo= r=20 future purchases.=20 ?????Which leads to the utilities themselves. With the state shelling out= =20 billions for power from the major generators how could Southern California= =20 Edison and Pacific Gas & Electric still not have the cash flow to pay the= =20 alternative producers? That motley collection of biomass solar wind and= =20 cogeneration companies has been shutting down for nonpayment--some of them= =20 because natural gas suppliers have cut them off. PG&E has made some payment= s=20 but SCE has paid zilch though a spokesman says it hopes to strike a deal t= o=20 start paying this week.=20 ?????Without enough honest information conspiracy scenarios fill the holes= .=20 Bad news is better than no news something Davis seems not to quite realize= .=20 By today or Thursday the weather will cool and some plants taken down for= =20 repair will come back online. The blackouts may cease but the crisis will b= e=20 just as deep as it was Monday and Tuesday. It is up to Davis to do a better= =20 job of persuasively explaining why. Otherwise the cynicism grows.=20 --- Wednesday March 21 2001=20 Rolling Blackouts: Blatant Extortion=20 ?????* Re Rolling Blackouts Hit Southland for First Time as Production=20 Falls March 20:=20 ?????So here we are 22 years after the notorious gas shortage having=20 another gun held to our head by an opportunistic energy consortium. Back in= =20 1979 we all had to wait in long lines just to pay more for gasoline. Now = we=20 have to face food in our freezers thawing and simmering in our homes during= =20 hot summer days just to earn the honor of paying more for electricity.=20 ?????Of course as soon as the rates are up and the environmental concerns= =20 are shoved aside watch how plentiful power will be. When is somebody in=20 government going to stand up for the consumer and stop this blatant form of= =20 extortion?=20 ?????JOHN JOHNSON=20 ?????Agoura Hills=20 * * * ?????So customers of PG&E and Edison are shielded from soaring wholesale= =20 prices? Some shield: turning off all our power without so much as a moment= 's=20 notice endangering lives and disrupting businesses just to keep our=20 electricity prices unreasonably low. Let's lift the rate caps to get the=20 lights back on. And if I need to be shielded from soaring prices I'll turn= =20 my own lights off.=20 ?????ANDREW LOWD=20 ?????Claremont=20 * * * ?????This state needs adequate reliable electricity to run a diverse=20 economy. Both political parties and business interests are at fault. This= =20 crisis demands top priority aimed at lasting solutions.=20 ?????The most immediate solution is fast-tracking of added generating=20 capacity. Freeway bridges were rebuilt in record time after the Northridge= =20 quake so we know it can be done. That is the type of effort that is needed= =20 immediately.=20 ?????Since Democrats hold the governorship and control both state legislati= ve=20 houses they are in the driver's seat. If the lights go out the Democrats = go=20 out. If this state government can't solve the problem we need a new=20 government that can.=20 ?????STEVE ANDERSON=20 ?????Huntington Beach=20 * * * ?????The alleged energy crisis in California is entirely contrived to relax= =20 environmental pollution standards and to raise energy rates. It's curious= =20 that the L.A. Department of Water and Power which was not deregulated is= =20 not currently experiencing an energy crisis. PG&E and Edison are both part = of=20 national and multinational corporations. Why should utility customers have = to=20 pay for their economic problems or gross mismanagement?=20 ?????Several power plants were taken off-line for routine maintenance=20 which may not have been so routine. Energy is a vital necessity if these= =20 companies can't provide it at a reasonable affordable rate then they shoul= d=20 be replaced by companies that can be taken over by the government or=20 de-deregulated. There is an abundance of solar energy in California of whi= ch=20 only a small fraction is being utilized. There is no shortage of energy in= =20 California only a shortage of intelligence will and honest politicians.= =20 ?????CHARLES B. EDELMAN=20 ?????Los Angeles=20 --- Utilities' Demand Blocks Bailout=20 NEGOTIATIONS HIT SNAG: PG&E Edison want end to price freeze if they sell= =20 transmission lines to state David Lazarus Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N114450.DTL=20 California's near-bankrupt utilities are demanding that higher electric rat= es=20 be a part of any deal to sell the state their power lines The Chronicle ha= s=20 learned.=20 A rate increase -- perhaps of more than 50 percent according to earlier=20 industry estimates -- would certainly draw a firestorm of protest from=20 consumer groups and force Gov. Gray Davis to backtrack from earlier pledges= =20 that rates would remain unchanged.=20 Nevertheless sources close to negotiations on the deal said Pacific Gas an= d=20 Electric Co. and Southern California Edison are attempting to make higher= =20 rates a condition for agreeing to a bailout scheme in which they would sell= =20 the state their transmission systems and some land.=20 The sources said the talks hit a new snag this week when state officials=20 realized that fine print sought by the companies could require the Public= =20 Utilities Commission to pass along all of the utilities' costs to ratepayer= s.=20 The sources said this would end a rate freeze that shields consumers from= =20 runaway wholesale electricity prices.=20 The inclusion of potential rate increases in the talks reflects the growing= =20 complexity of a deal originally intended by Davis to stabilize the finances= =20 of PG&E and Edison so banks would resume loans to the cash-strapped=20 utilities.=20 The negotiations subsequently have expanded to involve a state purchase of= =20 the utilities' transmission networks and acquisition of utility-owned land= =20 including spectacular coastal property near PG&E's Diablo Canyon nuclear=20 power plant.=20 Now they also have embraced further deregulation of California's=20 dysfunctional electricity market.=20 Clearly one of the terms being discussed is the regulatory environment= =20 said Joseph Fichera head of Saber Partners a New York investment bank tha= t=20 is advising Davis in the talks.=20 The past situation has not worked well he added. The utilities want som= e=20 certainty about their future.=20 TENTATIVE DEAL WITH EDISON To date the governor has announced a tentative agreement with Edison for t= he=20 state to buy the utility's power lines for almost $3 billion. Discussions= =20 with PG&E for a similar accord have dragged on for weeks.=20 An Edison official asking that his name be withheld acknowledged yesterda= y=20 that an end to the rate freeze is an expected result of the power- line sal= e.=20 Once the details of the pact are complete dominoes will fall the offici= al=20 said. One of the dominoes is the rate freeze.=20 A PG&E spokesman declined to comment.=20 In fact both Edison and PG&E have been aggressively seeking an end to the= =20 rate freeze for months.=20 The two utilities have a lawsuit pending in federal court demanding that th= e=20 PUC immediately raise rates so the utilities can recover almost $13 billion= =20 in debt accrued as a result of the freeze.=20 They have been trying a lot of things to get the rate freeze ended in=20 various forms said Carl Wood who sits on the PUC. Adding it to the=20 present talks is consistent with past behavior.=20 Wall Street has taken note that the negotiations no longer appear to be=20 making progress.=20 Paul Patterson an energy industry analyst at Credit Suisse First Boston= =20 told clients on Monday that the discussions may have lost some momentum in= =20 recent days. He did not give a reason.=20 For his part the governor sounded unusually cautious about the course of t= he=20 talks when asked late last week if a breakthrough was imminent.=20 SECRET STICKING POINTS We are going to take the transmission systems and the land that's deeded= =20 and we will work out an agreement Davis said at an appearance in San Jose= .=20 But there are a number of sticking points in the talks with PG&E that I'm= =20 not going to reveal.=20 One of those sticking points apparently is an insistence that the sale of= =20 utility assets include a long-sought lifting of the rate freeze.=20 Sources said lawyers from both PG&E and Edison had inserted the related ter= ms=20 into draft accords affecting each utility and that the full impact of the= =20 additions was not realized by state officials until this week.=20 One source said the language was just convoluted enough to slip beneath the= =20 radar screen of state negotiators. But the upshot once the words had been= =20 parsed was that the PUC effectively would lose control over power rates.= =20 CREDITWORTHINESS ON THE TABLE In Edison's case the terms of the tentative deal include the governor aski= ng=20 the PUC to support the creditworthiness of the utility.=20 This would ensure that future investments in both utility distribution and= =20 utility generation plants are provided fair returns of and on capital=20 consistent with current authorized returns and capital structure provisions= =20 it says.=20 Sources said the provision could be interpreted as a guarantee from the sta= te=20 that Edison would be permitted to recoup all outstanding costs from=20 ratepayers.=20 There may be some assumptions about this language that the rate freeze end= s=20 if it is adopted the Edison official said adding that he saw no reason t= o=20 disagree with such assumptions.=20 But Fichera Davis' adviser in the talks insisted that nothing is set in= =20 stone and that the negotiations are proceeding without a hitch.=20 This is a very complex transaction he said. God and the devil are in th= e=20 details.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Utilities' Demand Blocks Bailout=20 BLACKOUTS ROLL ON: Weather increased consumption blamed=20 David Lazarus Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N156508.DTL=20 Hundreds of thousands of Californians went without electricity for a second= =20 day yesterday as unusually warm weather and a high number of idle power=20 plants prompted blackouts throughout the state.=20 State officials said electricity usage rose yesterday even though condition= s=20 were largely unchanged from a day before. They surmised that fewer=20 Californians were conserving power.=20 We need people to really focus on that implored Patrick Dorinson a=20 spokesman for the Independent System Operator manager of the state's power= =20 grid. The more people can do the better it will be.=20 Rolling blackouts were ordered by the ISO about 9:30 a.m. and were suspende= d=20 at 2 p.m. after several plants that had been down for repairs returned to= =20 service. Additional power also was obtained from a plant in Arizona.=20 Utilities estimated that about 560000 customers were affected yesterday= =20 compared with more than 1 million a day earlier.=20 This week's blackouts marked the first time that people in Los Angeles shar= ed=20 the pain with those in San Francisco. Blackouts in January were confined to= =20 the northern part of the state.=20 FEWER AFFECTED IN SOUTH However Southern California Edison's burden was considerably lighter=20 yesterday than that of Pacific Gas and Electric Co.=20 Karen Shepard-Grimes a spokeswoman for the Southern California utility sa= id=20 only about 50000 customers went without power compared with nearly 440 0= 00=20 for PG&E.=20 Affected areas in the south included Palm Springs Santa Monica Long Beach= =20 and Pomona.=20 We're not in the business of turning customers' lights off Shepard- Grim= es=20 said. We're in the business of keeping lights on.=20 In PG&E's case things were tougher because low rainfall means that less=20 power is currently available from dams throughout the Pacific Northwest.=20 Ron Low a spokesman for the utility said blackouts were experienced by PG= &E=20 customers from Eureka to Bakersfield.=20 Our goal was to carry out the ISO's order with minimal impact on customers= =20 he said.=20 For its part San Diego Gas & Electric said about 75000 customers were=20 darkened.=20 Yesterday's blackouts began with PG&E customers in Block 12 and halted midw= ay=20 through Block 14. Customers in each block -- defined by power circuits rath= er=20 than geography -- typically will lose power for about 90 minutes before the= =20 service interruption rolls elsewhere.=20 Some cutoffs can last more than two hours however because of technical=20 problems switching individual blocks on and off.=20 NEXT UP: BLOCK 14 If additional blackouts are ordered today they will commence with the=20 remaining portion of Block 14 customers. (PG&E customers can determine thei= r=20 block by looking at the bottom left-hand corner of their monthly bill.)=20 The ISO's Dorinson said it is hoped that cooler weather and increased=20 generation will help avert further cutoffs this week.=20 Units are coming back into service that have been out he said. That wil= l=20 help a great deal.=20 Roughly 15000 megawatts of generating capacity was offline yesterday=20 including half of the alternative-energy plants which are unable to afford= =20 natural gas to run their turbines.=20 Many of the plant owners say they have not been paid by PG&E and Edison sin= ce=20 November. They are asking federal regulators for permission to sell their= =20 electricity elsewhere.=20 At the same time one of two units at the Mohave Generating Station in Neva= da=20 damaged in a fire Monday returned to service yesterday easing the load on= =20 California's grid.=20 The plant partly owned by Edison is not expected to return to full output= =20 until tomorrow.=20 PROBING SHUTDOWNS Nearly a third of California's generating capacity is currently down for=20 scheduled or unexpected maintenance. State regulators are investigating=20 whether some plant owners might be deliberately shutting down to drive pric= es=20 higher or reduce operating costs.=20 Loretta Lynch president of the Public Utilities Commission on Monday call= ed=20 the number of idle plants highly suspicious.=20 Dorinson at the ISO said that about 12000 megawatts of mainstream capacity= =20 was offline yesterday compared with roughly 10000 megawatts last year at= =20 this time.=20 --=20 Tell Us What You Think=20 Can you save 20 percent on your energy usage? Gov. Gray Davis is offering= =20 rebates for Californians who save on power starting in June and if you've= =20 got a strategy for conserving The Chronicle wants to hear it. We'll be=20 writing about the hardest-working energy savers in a future story. To get= =20 involved Write to the Energy Desk San Francisco Chronicle 901 Mission St= .=20 San Francisco 94103 or e-mail --=20 THE ENERGY CRUNCH -- Blackouts: About 560000 Californians including 440000 in Northern=20 California lost electricity yesterday for 90 minutes at a time.=20 -- Areas affected: Blackouts hit parts of blocks 12 and 14 and all of block= =20 13 yesterday. In the event of further blackouts the remainer of block 14= =20 would be next followed by block 1.=20 -- Outlook: Officials say blackouts are less likely today as temperatures a= re=20 expected to cool and power plants that have been offline for maintenance=20 resume generating electricity.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Manners Go Out the Window=20 Pedestrians in peril as drivers turn darkened S.F. streets into free-for-al= l=20 Steve Rubenstein Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N173178.DTL=20 Nobody got plowed into yesterday at Fifth and Howard streets in San=20 Francisco. Many came close.=20 The power outage that darkened the traffic lights at the frenetic South of= =20 Market intersection for more than an hour also darkened the souls of untold= =20 numbers of drivers sending motoring manners into the toilet.=20 The law says motorists are supposed to treat an intersection with=20 nonfunctioning traffic lights as a four-way stop. That means everyone stops= =20 then takes turns -- one by one -- creeping through the intersection.=20 Tell that to the two people in motorized wheelchairs who were nearly creame= d=20 by two eastbound SUVs.=20 Or to the young Swedish couple who had traveled halfway around the globe= =20 only to scamper through the intersection barely ahead of an office supply= =20 truck.=20 Or to the New Jersey tourist who proclaimed that California drivers during= =20 power outages were proof positive that the Chaos Theory lives and breathes.= =20 Some motorists stopped and took turns but many didn't. Some sped into the= =20 intersection immediately behind the vehicle in front without themselves=20 stopping at the white line. Some sailed through with a rolling stop and a= =20 warning honk. Some blasted through without stopping or honking.=20 I'm scared to death said Brian Walters of Dorchester N.J. after making= =20 it across Howard Street. This is organized madness. I subscribe to the Cha= os=20 Theory and this is what it looks like.=20 Sydney Freedman a tourist from Sydney walked briskly across the darkened= =20 crossroads smiling grimly.=20 I'll chance it he said.=20 He looked back and saw a woman in a motorized wheelchair nearly get squishe= d=20 by a westbound Chevy.=20 You have to be authoritative in this town when you cross the street he= =20 said. Especially that lady.=20 Therese Anderson and Andreas Sandstrom from Sweden raced across as quickl= y=20 as their backpacks would allow.=20 In this country everyone is in such a hurry said Anderson.=20 Everybody drives like a madman added Sandstrom. They say 'I want to be= =20 home right now and I don't care what happens to anyone else.' =20 The couple paused to gaze in wonder at the intersection learning more abou= t=20 America in five minutes than a pile of guidebooks could tell them.=20 This intersection said Sandstrom reminds you not to take life for=20 granted.=20 A few minutes later Parking Control Officer Tom Butz arrived in his meter= =20 minder wagon and pulled his orange vest and whistle from the saddlebag. He= =20 strode brave and true into the center of the bullring planted himself=20 between the whizzing cars and began waving his arms as if conducting The= =20 Rite of Spring.=20 I'm all by myself he said. I know it's a little risky. I'd better keep = my=20 angels with me.=20 At that moment the angels were on duty in Menlo Park where a blacked-out= =20 intersection at El Camino Real and Santa Cruz Avenue backed up traffic so f= ar=20 that it stretched into neighboring Atherton.=20 It's a large intersection and traffic is slow anyway but now it is severe= ly=20 impacted said Police Sgt. Terri Molakides. We don't get any warning=20 either. When the power is out the power is out. It's not like we can make= =20 any plans.=20 In general motorists seemed more likely to obey the four-way-stop rule on= =20 the Peninsula and in the East Bay than in San Francisco.=20 In San Mateo County some police departments have stopped trying to make=20 advance plans to cover darkened intersections. San Mateo Police Sgt. Kevin= =20 Rafaelli said putting up signs and posting officers sometimes caused proble= ms=20 rather than solving them.=20 If people just follow the law (and) stop at the intersection they can=20 handle it better than we do if we're out there he said. People are sort = of=20 getting used to it and are dealing with it.=20 In Berkeley and Emeryville motorists stopped one at a time at temporary st= op=20 signs with no apparent problems. At University Avenue and Sacramento Stree= t=20 in Berkeley Officer Matt Meredith said motorists were behaving themselves.= =20 That wasn't the case a while back when a driver who didn't stop at an=20 intersection during a blackout was broadsided by someone who did Meredith= =20 said.=20 The thing to remember is to stop and look he said.=20 TRAFFIC TIPS To avoid a collisions during blackouts the California Highway Patrol offer= s=20 this advice to motorists:=20 -- Treat any intersection with inoperative traffic lights as a four-way sto= p.=20 Each vehicle must stop when arriving at the white limit line then proceed= =20 only when safe taking turns.=20 -- If two vehicles arrive at the intersection at the same time the motoris= t=20 on the left must yield to the motorist on the right.=20 -- Never insist on taking the right of way even if you are entitled to it.= =20 -- Follow the directions of a police officer or traffic control officer=20 whose directions take precedence over lights or signs.=20 Chronicle staff writers Henry K. Lee and Matthew B. Stannard contributed to= =20 this report. / E-mail Steve Rubenstein at 2001 San Francisco Chronicle ? Page?A - 8=20 --- --- Historic Blackouts in State=20 Bay Area learns to cope=20 Jonathan Curiel George Raine Justino Aguila and Matthew B. St Tuesday March 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/M N219412.DTL=20 Today's rolling blackouts caused concern throughout the Bay Area including= =20 Colma where the sudden lack of power apparently caused a fire.=20 A light fixture at the Home Depot store in Colma caught fire around 10:45 a= .=20 m. 15 minutes after Pacific Gas and Electric Co. ordered blackouts for the= =20 area. No one was hurt.=20 I was in the back of the store when the power outage started said Dave= =20 Cole a consultant from Pacifica who was shopping for bolts and screws. We= =20 lost maybe 90 percent of the lights then maybe 10 percent of the lights ca= me=20 up. Then I heard a guy saying 'Get a ladder get a ladder!'=20 One of the lights on the ceiling had caught on fire and a couple of peopl= e=20 were getting ladders and fire extinguishers.=20 Store managers whisked everyone out of the store and Colma firefighters=20 arrived to make sure the blaze was extinguished.=20 At 11 a.m. Cole was waiting to get back into the store which was still=20 closed.=20 I need my bolts he said.=20 Elsewhere the San Francisco Fire Department had to rescue people stuck in = an=20 elevator at 2001 Embarcadero North said fire department spokesman Pete=20 Howes.=20 Scores of residents and businesses near the Embarcadero including the Levi= =20 Strauss & Co. headquarters were affected by the blackout.=20 At Levi Strauss this morning Phil Marineau the president and chief=20 executive officer led his 1300 employees by example using only minimal= =20 lighting for a meeting in his office at 10 a.m.=20 Employees were sent e-mails minutes after PG&E's 9:30 a.m. notification tha= t=20 a blackout was possible. The e-mails said workers should frequently save wo= rk=20 on their computers and that they should remain in the building and stand b= y=20 for further instructions.=20 Emergency lighting in hallways and stairwells were operated by generators.= =20 All elevators descended to the ground floor but one remained operating=20 through a generator.=20 Worked nicely said Jeff Beckman a company spokesman.=20 Yesterday -- the first day that rolling blackouts returned -- Shannon=20 Cashman's home in Walnut Creek was a difficult place to be.=20 Cashman's 4-year-old daughter Madison suffers from a brain defect that=20 stops her from breathing during sleep. The girl depends on a ventilator tha= t=20 runs on electricity.=20 Recently hospitalized and with a weakened immune system Madison badly need= ed=20 a nap yesterday afternoon. But when the Cashmans' power went out about noon= =20 it meant reading and coloring instead of rest for the girl and a little mor= e=20 anxiety than normal for her mother.=20 If this was a major earthquake or something like that and we couldn't use= =20 the ventilator we'd take her to the hospital said the 33-year-old Cashma= n.=20 Otherwise we'll just wait for the power to come back on.=20 In a stroke of irony yesterday the lights went out and computer screens we= nt=20 dark at the San Francisco offices of the state Public Utilities Commission= =20 the agency some people blame for the energy crisis and others look to for t= he=20 solution.=20 At a Petco animal store in Redwood City nocturnal leopard geckos that=20 weren't familiar with the state's power woes thought it was night and awoke= =20 from their routine daytime slumber.=20 The geckos clung to the glass of their cages as manager Sally Daine and her= =20 employees misted lizards and watched frozen mealworms melt.=20 The worst thing is some of the reptiles need heat but it's so hot I don'= t=20 think it will matter she said.=20 At Auto Pride Car Wash a few blocks away Dan Giudici watched as the team o= f=20 employees he supervised washed cars the old-fashioned way -- with buckets a= nd=20 hoses. The company's big mechanical car wash went unused.=20 Customers didn't seem to mind the manual wash said Giudici who was chargi= ng=20 half-price. But he was running out of towels.=20 Even those who hoped they were immune to power problems were affected.=20 Palo Alto runs its own utility but the electricity began winking out about= =20 12:30 p.m.=20 The city depends on a distribution line of the state grid so it is=20 vulnerable to blackouts said Linda Clerkson public relations manager for= =20 Palo Alto Utilities. In addition the city relies on PG&E for some of its= =20 power she said.=20 Businesses were caught by surprise.=20 Well at least it happened in a better time than the morning said Nick= =20 Badiee owner of the Lytton Roasting Co. coffee house. My toaster went out= =20 and the coffee began getting cold so I lost three or four people who walke= d=20 out the door. I'm not angry yet but I would say I am concerned.=20 For one Milwaukee woman visiting San Francisco the blackout was an=20 unexpected lesson in the problems of electricity deregulation.=20 Cindy Wilburth a financial consultant who advises Wisconsin utilities cam= e=20 to the Bay Area for vacation but left yesterday with important research for= =20 her job.=20 This has been a huge learning lesson for Wisconsin Wilburth said as she= =20 waited for a bus outside the powerless Comfort Inn by the Bay in Cow Hollow= .=20 Wilburth said her state and others that once eyed deregulation are now=20 backing off.=20 It just makes me realize how we've gotten ourselves in a pinch in a free= =20 economy she said.=20 As she mused about the predicament in which the state has found itself her= =20 friend was just thankful to get out of here.=20 I love the cold compared to this said Cindy Stuckey of Milwaukee. At= =20 least I know I can stay in my home secure and warm.=20 Across the street at the Travelodge By the Bay Rolando Gutierrez had=20 already lost three guests just an hour into the blackout.=20 This is the richest state and this is a rich city -- plenty of people want= =20 to come here he said. We shouldn't be suffering these blackouts.=20 Chronicle staff writers Jaxon Van Derbeken Mark Martin Henry K. Lee=20 Michael McCabe Bernadette Tansey and Marshall Wilson contributed to this= =20 report.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Bay Area residents learning to roll with blackouts=20 Posted at 9:58 p.m. PST Tuesday March 20 2001=20 JOHN=20 WOOLFOLK=20 AND STEVE=20 JOHNSON=20 Mercury News=20 As rolling blackouts swept the state for a second straight day Tuesday=20 Californians already seasoned by droughts and earthquakes were learning to= =20 live with yet another upheaval: periodic power outages.=20 Blackouts are still a novelty in Southern California -- hit for the second= =20 time Tuesday -- but they're almost routine for Bay Area residents who have= =20 seen four days of outages this year and now expect many more as temperature= s=20 rise. Toting flashlights avoiding certain roads and even shutting off thei= r=20 coveted hot tubs they're adjusting to life in California's new Dark Age.= =20 ? ? Karen T. Borchers--Mercury News When the lights went out at Grant Elementary School in San Jose on Tuesday= =20 morning teacher Renee Johnson took her second-grade students out to the la= wn=20 to read to them. Marjorie Meagher now looks at her clock before taking the elevator she need= s=20 to get around her two-story San Jose home fearing she'll get stuck during= =20 rolling blackouts.=20 ``They tend to happen on the hour or half-hour so I try not to use it=20 then'' said Meagher 74 who is disabled. ``I'm very careful. My own=20 personal fear is getting stranded in the elevator.''=20 From 750000 to about 1 million customers lost power for an hour or so in= =20 stages Tuesday as a rash of power plant outages and record temperatures in= =20 San Jose and elsewhere triggered a critical shortage.=20 As was the case Monday when 1.2 million to 1.8 million customers were=20 affected Tuesday's outages were split between the northern and southern=20 parts of the state. Blackouts began at 9:30 a.m. and lasted until 2 p.m. wh= en=20 authorities obtained extra power from other Western states. Outages were=20 considered less likely today.=20 But people are preparing anyway. Like low-flow toilets and earthquake kits= =20 flashlights and generators may be emerging as another fact of life in the= =20 Golden State.=20 In San Francisco's Inner Sunset district Han Yong Park had the satisfied= =20 smile of a well-prepared man having bought a portage generator for his Park= 's=20 Farmers Market five months ago.=20 Tuesday morning the generator churned loudly on the sidewalk positioned= =20 between the tomatoes and green beans. Inside clerks tallied purchases on= =20 electric cash registers.=20 Park motioned down the street where neon signs were dark and some=20 restaurants closed. ``No one else in the area has a generator'' he said.= =20 Energy officials say such equipment will come in handy this summer. Power= =20 supplies are expected to be so strained that Californians should expect man= y=20 more rolling blackouts.=20 ``I don't want to kid anybody'' said Patrick Dorinson spokesman for the= =20 California Independent System Operator which manages the power grid for mo= st=20 of the state. ``Supplies are very very tight. When you look at such a big= =20 state and such a large shortfall I think we have to prepare ourselves. It'= s=20 very possible that going into this spring and summer we're going to see som= e=20 very difficult days.''=20 Combination of factors=20 The multiple causes that conspired to darken California on Tuesday=20 underscored the difficulty officials face in keeping the lights on.=20 The thermometer shot to record-breaking levels at some locations in the Bay= =20 Area driving up power demand. San Jose hit 83 compared with an average 66= =20 degrees for March 20 and breaking the record high of 80 set in 1960.=20 What's more 12000 megawatts of power were unavailable because plants had= =20 shut down for maintenance or because cash-strapped utilities haven't paid= =20 them.=20 And consumer conservation has been spotty. While state energy officials say= =20 conservation rose from 5 percent in January to 8 percent in February grid= =20 managers said this week Californians weren't saving enough energy. They eve= n=20 revised their estimate of how much homes a megawatt can power down from=20 1000 homes to 750 to reflect greater consumption.=20 Improved conservation later in the day helped stave off a second wave of=20 outages they said.=20 Many shrug off the threat of rolling blackouts.=20 ``I think I've gotten used to it'' said Mary Carlson 58 of San Jose who= =20 took her granddaughter for a walk and read the paper during blackouts in=20 January. ``I just go with the flow. I'm not going to get too excited about= =20 it. If they turn the power off it's no big thing.''=20 Erica Finn secretary at Acacia Glass in San Francisco said she wasn't too= =20 upset when blackouts shut down the credit card machines electric sanders a= nd=20 phones. She bought coffee pulled a chair into the sun and popped Madonna= =20 into her portable CD player.=20 ``I have to brush up on my tan and get paid for it'' she said.=20 But for others the consequences are potentially serious.=20 At a Palo Alto dental office the blackouts interrupted root canals for thr= ee=20 patients. Dentists Darrell Dang Robert McWilliams and Kurtis Finley insert= ed=20 temporary fillings by hand rescheduled the procedures and went to lunch.= =20 The receptionist used a cell phone to cancel the afternoon's appointments= =20 frustrated that there's no way to prevent a repeat of Tuesday's fiasco if t= he=20 blackouts continue.=20 A new routine=20 Others have taken everyday steps to cope with the threat of losing power.= =20 Stephen O'Reilly a 34-year-old San Jose engineer who often drives to see= =20 clients said he avoids side streets because blackouts could darken signal= =20 lights and tie up intersections.=20 ``I used to take back roads to avoid traffic but I'm trying to use the=20 freeways more because there are no lights'' said O'Reilly adding that he'= s=20 shut down his electric hot tub to help conserve power.=20 At Pasta Primavera in San Mateo manager Chris Harris has stocked up on=20 candles and has plans to buy a generator for his restaurant. When blackouts= =20 arrived just before the lunch crowd Tuesday and cut power to ventilation=20 fans he even considered revising his menu replacing smoke-producing chick= en=20 and shrimp with simple marinaras and alfredos.=20 ``I don't know if you'd want to dine with the smell of smoke'' Harris said= =20 as customers trickled into his darkened restaurant on Fourth Avenue. ``If= =20 this is going to continue through the summer it's going to affect our=20 pockets.''=20 San Francisco International Airport which agreed months ago to shut down i= ts=20 massive air conditioners to save power during shortages is now routinely= =20 stuffy.=20 On Tuesday the temperature reached a steamy 85 degrees inside the airport's= =20 North Terminal which serves most of United Airlines' flights.=20 ``It's become uncomfortable if not intolerable'' said Ron Wilson airport= =20 spokesman. ``It's like getting in a car that's been left in the sun all day= .=20 It's much hotter inside. .?.?. We've turned on the fans but they're just=20 moving the hot air.''=20 Hospitals cut off=20 Several hospitals complained they lost power Tuesday saying they thought= =20 they were exempt. PG&E said hospitals with sufficient backup generation to= =20 power themselves can be turned off. But state regulators said they could no= t=20 confirm that statement and hospital officials scoffed at the suggestion.= =20 ``Every hospital has backup power generation but it only covers 30 to 40= =20 percent of the hospital'' said Roger Richter a senior vice president with= =20 the Hospital Council.=20 Nonetheless hospitals are coping with the situation.=20 ``Our patients are concerned for sure'' said Jackie Floyd head nurse at= =20 the Satellite Dialysis Center South in San Jose which lost power. ``But=20 while it's a pain we can handle the blackouts. We're kind of getting the= =20 idea here that this a problem and we have to adjust.''=20 But while Californians may be adjusting they're not at all pleased.=20 ``I'm frustrated with this power thing'' said Ana Rivera who manages the= =20 Wash Club in San Francisco where washers and dryers had stopped mid-cycle.= =20 ``Who do you blame? No one wants to accept blame.'' Sara Neufeld Ann Marimow Kim Vo Frank Sweeney Barbara Feder Aaron Davi= s=20 Gil Duran and Dave Beck contributed to this report.=20 --- --- Powerless again=20 Outages were lighter after generators came back online and conservation=20 efforts kicked in. Blackouts may be averted today.=20 March 21 2001=20 By TONY SAAVEDRA JOHN HOWARD CHRIS KNAP and JEFF COLLINS The Orange County Register=20 The Ridgewood Power methane-burning plant at the Olinda Alpha landfill in= =20 Brea is producing 3.3 megawatts down from five because Edison owes it $1.= 5=20 million and cranking up to full power is no longer a priority Photo: H. Lorren Au Jr. / The Register ? ? A second day of statewide blackouts ratcheted up the frustration level=20 Tuesday on the streets of Orange County and in Sacramento as consumers=20 demanded solutions from politicians unable to give them.=20 There was a bit of good news though: Blackouts may be averted for the rest= =20 of the week after temperatures moderated two stalled generators came back= =20 online and conservation efforts kicked into gear.=20 ?=20 Some Orange County residents took the blackouts in stride. In Mission Viejo= =20 above the West Coast Football Club's under-16 boys team scrimmages under= =20 gas-powered lights Tuesday. The club has been running to conserve energy=20 Photo: Kevin Sullivan / The Register ? ? Consumers were able to save 900 megawatts - enough to light about 675000= =20 homes - by cutting power usage said Patrick Dorinson spokesman for the=20 Independent System Operator which oversees 75 percent of the state's=20 electricity grid. That helped the ISO halt the blackouts Tuesday afternoon.= =20 Californians are back on the conservation trail and we appreciate it=20 Dorinson said.=20 Power regulators Tuesday morning predicted there would be twice as many=20 outages as Monday when more than 1 million consumers statewide lost power = in=20 one-hour to 90-minute increments.=20 Luis Pagan an assistant at the Santa Ana Animal Shelter waits out the=20 blackout Tuesday with one of the shelter's dogs up for adoption Photo: Paul E. Rodriguez / The Register ? ? Beginning at 9:30 a.m. Tuesday blackouts tangled intersections in Costa=20 Mesa forced Huntington Beach students to study by flashlight and stilled= =20 cash registers in Santa Ana. About a half-million homes and businesses were= =20 unplugged statewide before 2 p.m. Power was restored to most of Southern=20 California by 11:30 a.m. Outages affected more than 9200 consumers in Oran= ge=20 County.=20 The ISO had expected more severe outages to hit at the peak hour of 7 p.m.= =20 but was able to keep the lights on as downed power plants came back online= =20 and imports from other states increased.=20 While outages were lighter than Monday the blackouts aggravated consumers= =20 who doubted that Gov. Gray Davis lawmakers and electricity officials are= =20 doing enough to keep the power flowing in California.=20 ?=20 Zulema Avarez left and Erica Ramirez said they were caught off-guard when= =20 the power went out so they closed the fashion store in Santa Ana where the= y=20 work Photo: Paul E. Rodriguez / The Register ? ? I think this is insane said Charlee Lang 63 of Costa Mesa. Gray Davis= =20 didn't do his job for a long time he didn't get serious until November. We= =20 need to demand immediate action be taken.=20 Bill Brannick 65 of Costa Mesa added: There's a lot of complicity here= =20 and we're just innocent victims.=20 Davis in a Sacramento news conference said he inherited California's fail= ed=20 experiment with electricity deregulation enacted in 1996 under former Gov.= =20 Pete Wilson.=20 I think a fair assessment of this situation is that we were dealt a pretty= =20 bad hand here Davis said. No (new power) plant was approved in the 12=20 years prior to my being governor.=20 With summer peak demand expected to be 16000 megawatts higher than Monday= =20 and Tuesday more days of blackouts are forecast for coming months. Though= =20 Davis has signed long-term contracts to provide California with reliable=20 energy the deals haven't yet taken effect. Some suppliers won't start=20 providing electricity until the state reaches a so-far elusive agreement to= =20 help the utilities pay off billions in debt by buying their transmission=20 lines.=20 Assembly Republican Leader Bill Campbell R-Villa Park said that the effor= t=20 to resolve the state's energy crisis was floundering in the midst of unpai= d=20 bills stalled negotiations and rolling blackouts.=20 Tuesday began with 29 percent of California's power supply off line mostly= =20 from generating plants suddenly down for unscheduled maintenance. About 30= 00=20 megawatts was missing from so-called qualifying facilities or small power= =20 producers who have not been paid $1.8 billion by cash-strapped utilities an= d=20 say they can't afford to operate. Davis said he would ask the PUC to order= =20 utilities to begin paying the qualifying facilities for any energy supplied= =20 beginning April 1 but the payments would not apply to the outstanding debt= .=20 Some smaller producers threatened to force Edison into involuntary bankrupt= cy=20 if they are not paid soon.=20 Blackouts began Tuesday two hours earlier than on Monday as the ISO called= =20 on utilities to dump 500 megawatts. It was only the second day of blackouts= =20 for Southern California but the fourth for Northern California since=20 January.=20 The Disney Resort which includes Disneyland and the new California=20 Adventure voluntarily cut back one megawatt of electricity on Monday and= =20 again Tuesday said Anaheim Public Utilities.=20 All of the reductions were in backstage areas not seen by guests said Disn= ey=20 spokeswoman Chela Castano-Lenahan.=20 In other workplaces people tried to make do.=20 Flashlight beams bobbed in aisles at a Target in Santa Ana where the power= =20 stopped at 10:30 a.m. Workers escorted customers who continued shopping an= d=20 made their purchases at battery-powered cash registers. Customers were=20 eventually asked to leave when the batteries ran low.=20 Oh well no soda no sunglasses said one woman as she headed back to her= =20 car.=20 The Metro Pointe shopping center in Costa Mesa also went dark.=20 I was in the middle of making a reservation when everything went out sai= d=20 Peggy Thomas a sales executive for Travel of America along South Coast=20 Drive. All of us here went 'Oh no it's happened to us.' =20 Said one Costa Mesa police officer as he headed for his motorcycle and a= =20 blackout-related fender bender: You can thank the governor for that one.= =20 At Hawes Elementary School in Huntington Beach Principal Marie Smith was= =20 demonstrating to her third-grade class what would happen in a blackout. But= =20 before she could flip off the light switch the power died.=20 The kids thought she was joking.=20 Register staff writers Tiffany Montgomery Sarah Tully Tapia Nancy Luna J= im=20 Radcliffe Binh Ha Hong Theresa Salinas Eric Johnson and Danielle Herubin= =20 and the Associated Press contributed to this report.=20 --- --- The iceman shunneth effects of hourlong blackout=20 March 21 2001=20 By JIM RADCLIFFE The Orange County Register=20 Ken Ackerman owner of ABC Ice House in Laguna Niguel checks on his frozen= =20 inventory during Tuesday morning's rolling blackout. The ice managed to=20 endure the hourlong power outage Photo: Jebb Harris / The Register ? ? Ken Ackerman didn't sweat much when a blackout struck his Laguna Niguel ice= =20 business at 10:30 a.m. Tuesday.=20 The walk-in freezer at ABC Ice House held 8 tons of ice. And for an hour t= he=20 temperature in there rose from 20 degrees to 45 degrees.=20 But very little melted.=20 Ackerman said most refrigerators can handle blackouts as long as outages ar= e=20 less than two hours.=20 I think people are going to get used to one-hour blackouts and realize it'= s=20 not a problem'' Ackerman said.=20 The blackouts actually were profitable for Ackerman.=20 An Irvine laboratory struck by a power outage bought 100 pounds of dry ice = to=20 preserve human tissue.=20 More blackouts through the summer could be a boon for the ice business - or= a=20 bust.=20 It could mean more ice sales -- or that his supplier has trouble filling hi= s=20 orders.=20 It's going to be an interesting summer'' Ackerman said.=20 I have no idea if we'll make more or less.''=20 Traffic will be the biggest problem if blackouts continue Ackerman said.= =20 On Monday a nearby Costco that had lost power ordered 200 pounds of ice to= =20 keep its refrigerated goods cold.=20 But dead traffic lights and congested roads made it impossible to deliver t= he=20 ice before the outage ended. Costco canceled the sale.=20 We pride ourselves on getting our deliveries made in an hour Ackerman=20 said.=20 --- --- Traffic officials are seeing red over blackouts=20 Battery backups are planned by several cities to aid confused drivers.=20 March 21 2001=20 By HEATHER LOURIE The Orange County Register=20 Traffic backs up Tuesday at Crown Valley Parkway at Forbes Road in Laguna= =20 Niguel as drivers had to navigate their own way Photo: Jebb Harris / The Register ? ? Toby Tran approached an Aliso Viejo intersection and wasn't sure what to do= .=20 Ahead of him the traffic signal was dark a casualty of the rolling=20 blackouts that struck Orange County on Monday and Tuesday.=20 So Tran kept driving smacking into an oncoming car at the corner of Aliso= =20 Creek and Enterprise.=20 It just happened a shaken Tran 29 said from his Aliso Viejo home. I= =20 tried to stop and I couldn't. There was no light. Nothing.=20 Tran's accident Monday afternoon and several others like it underscore on= e=20 of the most significant dangers looming in the threat of future blackouts.= =20 Traffic signals that fade to black when the power goes out instead of=20 converting to flashing red make wrecks far more likely because drivers=20 become confused and frustrated traffic engineers and experts said Tuesday.= =20 I didn't know what to do said Tran who was on his way to a high school= =20 jogging track. Luckily I'm alive but I'm very scared.=20 On Day 2 of Southern California's power outages worried city officials=20 across Orange County hunted for ways to respond to paralyzed intersections= =20 when state regulators pull the plug.=20 We need to be ready said Hamid Bahadori traffic engineer in the city of= =20 Orange. This thing is only going to get worse in July and August.=20 One popular idea: installing emergency battery-backup units at traffic=20 signals to keep lights flashing red during blackouts. Several Orange County= =20 cities including Irvine Laguna Niguel and Orange are already moving to= =20 install the devices as early as this summer.=20 In our minds (a flashing light) is a vast improvement over a blacked-out= =20 signal said Dave Rogers Laguna Niguel traffic engineer. On Tuesday night= =20 his city was expected to approve the purchase of the battery packs for all = 74=20 of its traffic signals.=20 Timing in this case seems to be everything Rogers said. A lot of citi= es=20 had contemplated it. We just took it that extra step.=20 John Thai an Anaheim traffic engineer cautioned that cities need to do=20 adequate research and testing before they launch into such projects.=20 There is nothing that is foolproof Thai said. All this is new territory= .=20 Some cities are also considering rolling out temporary stop signs and sendi= ng=20 police officers to more intersections.=20 Although the state's vehicle code requires motorists to treat dead traffic= =20 signals like a four-way stop motorists often blow through the intersection= s=20 police said.=20 It's dangerous said Tustin police Lt. Mike Shanahan after several=20 near-wrecks in his city during Monday's outages. People are not very good = at=20 reacting to changes in their conditions.=20 Flashing red is something that catches your eye. It's a warning that=20 something is amiss but the absence of all lights is worse.=20 RELATED STORIES=20 =01=07 How to contact your Representatives =01=07 'Current' events =01=07 The iceman shunneth effects of hourlong blackout =01=07 Powerless again =01=07 Alternative power producers cut back or shut down as payments from b= ig=20 utilities lag =01=07 O.C. saves its energy -- for blaming others =01=07 Blackout readiness on agenda --- --- Alternative power producers cut back or shut down as payments from big=20 utilities lag=20 That is a factor in blackouts=20 March 21 2001=20 By HANH KIM QUACH The Orange County Register=20 Every megawatt of electricity counts in this deregulated energy market -=20 including the five megawatts generated from the Olinda Alpha landfill in=20 Brea.=20 The methane-burning plant is producing only 3.3 megawatts now because=20 Southern California Edison owes it $1.5 million and cranking up to full pow= er=20 is no longer a priority said Martin Quinn executive vice president of=20 Ridgewood Power which runs the plant.=20 We're doing maintenance now when we ordinarily wouldn't do it. Because we'= re=20 not being paid it was a good time to cut back'' Quinn said.=20 That scenario has been playing out across the state in the past two weeks a= nd=20 was a major factor in Monday's and Tuesday's blackouts.=20 Those who provide electricity through alternative means - burning methane o= r=20 wood chips or using cleaner-burning technology with traditional fossil fue= ls=20 - are not being paid for what they sell to the big utilities. So they eithe= r=20 can't afford to produce energy or see little incentive to do so.=20 On Monday their absence from the statewide electricity grid created a=20 1300-megawatt shortfall -- enough to power 1.3 million homes.=20 Taking that much power offline meant that any burp in the system would put= =20 the state under the minimum amount of electricity needed to avoid blackouts= .=20 When one conventional Southern California plant went down because of a=20 transformer fire Monday the blackouts began.=20 If all of California's (alternative) generators were operating yesterday a= nd=20 today rolling blackouts would have been avoided'' Quinn said Tuesday.=20 Within the next couple of weeks as the weather warms and alternative energ= y=20 producers continue to try and operate without money California could see= =20 twice as many of those producers go offline further increasing the potenti= al=20 for blackouts said Jan Smutny-Jones executive director of Independent=20 Energy Producers.=20 The alternative energy producers which provide about a third of the state'= s=20 energy are deemed so crucial that Gov. Gray Davis wants the Public Utiliti= es=20 Commission to order the utilities to pay them. As drafted though the orde= r=20 would only include payment on future sales it doesn't address existing deb= t.=20 The Legislature has been working since January to halve the rates that=20 alternative producers charge utilities and to require utilities to pay for= =20 November's energy by April 1. But that bill is still moving through the=20 Legislature.=20 Small plants threaten Edison with bankruptcy=20 Smutny-Jones said that if the small generators are not paid promptly sever= al=20 will attempt to force Edison into bankruptcy probably within a week.=20 Unlike the large natural-gas generators that have been paid by the state=20 Department of Water Resources alternative energy producers are locked into= =20 contracts with utilities. Collectively Pacific Gas & Electric and Edison o= we=20 alternative energy producers about $1 billion.=20 PG&E has paid about 15 cents for each dollar it owes.=20 Obviously they're a source of generation and looking at how much load ou= r=20 customers need they're a source that has provided energy'' said Jon=20 Tremayne Pacific Gas & Electric spokesman. We've been trying in good=20 faith to make payments on energy.''=20 But Edison has not paid any money. Edison's alternative energy director La= rs=20 Bergmann said the company will not pay until larger reforms are made in ho= w=20 the producers' rates are calculated.=20 But the company recognizes that its nonpayment is causing problems.=20 To the extent that there are hundreds of megawatts that are idled here it= =20 just exacerbates the (energy) problem. ... They're facing similar problems = to=20 what we faced - they don't have sufficient (income) coming in the door''= =20 Bergmann said.=20 Plants go into mothball mode=20 Millenium Energy in Kern County is owed $40 million total by PG&E and Ediso= n.=20 On March 1 the company shut down both of its coal and petroleum coke-burni= ng=20 plants and doesn't plan to bring them back up until it is paid.=20 Millenium's plants which use a special technology to reduce emissions=20 generate 150 megawatts of energy.=20 We've gone into mothball mode our machinery just sits there on cold=20 standby'' said President Mike Hawkins. We've been delivering free electro= ns=20 to the system in the hope that the system would resolve itself. But we can'= t=20 do that anymore.=20 One biomass plant in Lassen County has scaled back from 31 megawatts to=20 eight. Burney Forest Power burns wood chips to produce energy and has only = a=20 couple weeks' supply of chips left.=20 When you don't even know what you'll get paid it's hard to say 'Let's go= =20 out and get a bunch of fuel''' said Milt Schultz the plant's general=20 manager.=20 The sad thing is (the state) really can't afford to lose us.''=20 --- --- O.C. saves its energy -- for blaming others=20 March 21 2001=20 By RICHARD CHANG The Orange County Register=20 Darkened stores were forced to turn away customers as stock manager=20 Bridgette Kelly left does here at a Linens 'n Things in Costa Mesa. The= =20 store closed for 45 minutes Tuesday morning Photo: Michael Kitada / The Orange County Register ? ? Orange County residents are making efforts large and small to conserve=20 electricity as they face rolling blackouts and surging energy bills.=20 Reactions to the early spring crisis - with blackouts throughout the state= =20 Monday and Tuesday - are ranging from confusion to rage.=20 Many residents have taken practical steps such as turning off lights they'= re=20 not using waiting until off-peak hours to do their laundry and opening=20 windows instead of using air conditioning.=20 My house is full of Philips energy-saving light bulbs said Ray Rutledge= =20 48 of Buena Park. Our light bill has dropped 7 1/2 percent. We use=20 low-voltage outdoor lighting. We've got an energy-saving thermostat. It's s= et=20 back to 65 (degrees) in the wintertime.=20 Kim Wilson who lives in an unincorporated area of Orange County near Santa= =20 Ana and Tustin said he has cut down on lighting in his house and has reduc= ed=20 by half the time his pool cleaner runs. Still his energy bill remains abou= t=20 $400 a month.=20 I don't know what ... to do Wilson 57 said. We've cut back.=20 Wilson added that he is not pleased with the way government or the energy= =20 companies have handled the crisis.=20 I think it's disgusting. It's such political garbage. Who was it that made= =20 these decisions? Who got us into it?=20 'TRYING TO CONSERVE'=20 Jenny Hann 60 of Costa Mesa said her workplace has devised an emergency= =20 plan for conservation and future blackouts.=20 We're definitely trying to conserve as much as we can the bank=20 administrator said. Hann expressed frustration with the energy companies.= =20 When you see these executives that have been running the show and the mone= y=20 they're making it's bothersome she said.=20 Jennifer Souto 27 of Tustin said even though she's a stay-at-home mother= =20 she keeps the lights off all day. She doesn't use her air conditioning=20 either.=20 Souto said she was locked out of her house for 90 minutes Monday because a= =20 blackout cut power to her garage door. She says she's not sure who to blame= .=20 Paul Finch 38 of Westminster blames Edison and Gov. Gray Davis.=20 I don't believe info I get from Edison or from our illustrious governor= =20 Finch said. There's more to it than how they've represented it.=20 --- --- Blackout readiness on agenda=20 O.C. companies braced for outages Tuesday in different ways. Not all were= =20 struck but they felt the effects.=20 March 21 2001=20 By TAMARA CHUANG The Orange County Register=20 In case of a power failure Tuesday the Fluor Corp. in Aliso Viejo stocked= =20 elevators with homemade blackout kits filled with cookies flashlights and= =20 bottles of water.=20 They're in the elevators although we've been told not to use the=20 elevators said Lori Serrato a company spokeswoman. We're using the=20 stairwells waiting for our time of darkness.=20 Tales of anxious preparation were more common than actual blackouts for=20 Orange County businesses Tuesday.=20 Edison told some companies as special power users who've agreed to cut bac= k=20 when asked to expect to do so. Conexant Systems Inc. got a warning from=20 Edison and immediately shut down air conditioning and equipment not in use= =20 and stopped production. The blackout never came.=20 Kingston Technology Co. when notified by Edison on Tuesday morning=20 broadcast the warning on the company intercom. The company also e-mailed=20 employees a guide explaining the blackout.=20 It's already affected productivity. We've been busy getting all our e-mail= s=20 out before it happens said Heather Jardin a spokeswoman for the Fountain= =20 Valley computer memory maker.=20 Kingston still had power by day's end but in an emergency the company's= =20 manufacturing plants revert to Kingston's own power generators Jardin said= .=20 Heart valve maker Edwards Lifesciences turned on its backup generators=20 Tuesday morning because of the potential for there to be a blackout in ou= r=20 area said company spokesman Scott Nelson. But (as of 3:30 p.m.) the=20 blackout didn't materialize Nelson said.=20 At the regional office in Irvine Verizon Wireless implemented conservation= =20 efforts such as motion sensors that shut off lights after 30 minutes of=20 inactivity and separate heating and air conditioning units on all floors.= =20 Some of the company's cell sites in Orange County and Los Angeles did lose= =20 power Monday and Tuesday but they automatically switched to backup battery= =20 sources.=20 Other companies - PacifiCare ICN Pharmaceuticals Beckman Coulter and=20 Allergan - said they took precautions turning out some hallway lights and= =20 communicating safety procedures to employees.=20 Disneyland Ingram Micro in Santa Ana and Western Digital Corp. in Lake=20 Forest all were prepared.=20 But none reported blackouts by day's end.=20 Some county businesses did get hit.=20 Businesses along the 900 block of South Coast Drive - including 14 stores a= t=20 the Metro Point shopping center in Costa Mesa - went dark about 10:20 a.m.= =20 All of a sudden it was dark said Henry Gonzalez manager of Boudin Baker= y.=20 We ran out of coffee. We couldn't bake anything. We tried to accommodate a= s=20 best as we can.=20 Other stores simply closed during the blackout frustrating shoppers.=20 We walked over to (Marshalls) and it was dark and there was a sign on the= =20 door that said 'Due to the blackout we're closed' said shopper Roberta= =20 Allison a West Virginia tourist. Don't they warn people here? Do they jus= t=20 whack the power off?=20 Marshalls employees escorted customers out of the store when the power went= =20 out. Other stores including Nordstrom Rack and Best Buy were not affected= .=20 Across the street from the center employees spilled out of office building= s=20 cheering and waving their hands in victory as power outages forced them to= =20 halt work.=20 Lots of people just walked out of the office to run errands said Amy=20 Bateman a loan officer at Capital Funding Group in Costa Mesa.=20 She said her office building at 940 South Coast Drive went dark for about= =20 70 minutes. Like dozens of others in the building she was working at her= =20 desk when the computers and lights went dark.=20 We've just been sitting around. We can't do anything said Bateman.=20 The blackout hit other businesses on Monday.=20 Buy.com employees spent their hour without power using their wireless=20 Blackberry pagers to answer and send e-mail.=20 The Crazy Horse Steakhouse in Irvine lost power after the lunch rush said= =20 Donna Mulkey the restaurant's manager. Since the broilers remained hot th= e=20 cooks kept cooking and the customers kept eating. When they finished waite= rs=20 calculated the bills by hand.=20 At Broadcom Corp. in Irvine the power went out just before Rep. Christophe= r=20 Cox was to tour the facility.=20 It struck me as particularly ironic Cox told members of the House=20 subcommittee on energy and air quality Tuesday that Broadcom's co-founder= =20 Henry Samueli spent the hour before the meeting using a letter opener to= =20 open his paper mail and sitting by the window so he could get some sunlight= =20 to read.=20 Cox R-Newport Beach told the panel which was holding a hearing on=20 California's electricity crisis that the entire company could not functio= n=20 during this period of time and the same was true for more than a million=20 people he said. It's a Third World experience in California.=20 Register reporters Chris Farnsworth Dena Bunis Bernard Wolfson Nancy Lun= a=20 Eric Johnson Elizabeth Aguilera and Jennifer Hieger contributed to this=20 story.=20 --- --- Calif To Order Utils To Pay Small Generators Up Front-Gov 03/21/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 SACRAMENTO Calif. (AP)-- California regulators will order the state's two= =20 largest utilities to pay small independent power generators in advance a= =20 move Gov. Gray Davis hopes will bring a quick end to the blackouts that=20 darkened California this week.=20 Davis accused PG&E Corp. (PCG) unit Pacific Gas & Electric Co. and Edison= =20 International (EIX) unit Southern California Edison of taking in money from= =20 customers while failing to pay the generators known as qualifying=20 facilities which produce up to one-third of the state's power. As a result= =20 he said the utilities are partly responsible for this week's blackouts.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators the governor said at a Capitol news conference Tuesday= =20 evening. They've acted irresponsibly and immorally and it has to stop.=20 The state lost about 3100 megawatts or enough electricity to power 3.1=20 million homes on Tuesday from alternative energy plants that say they can'= t=20 afford to keep operating because the utilities haven't paid their bills in= =20 weeks. The utilities which are near bankruptcy owe the QFs about $1=20 billion. Pacific Gas & Electric has made partial payments.=20 As reported by Dow Jones Newswires Southern California Edison met with=20 representatives of the governor Tuesday to discuss plans to begin making=20 partial payments to the QFs. Pacific Gas & Electric which called Davis'= =20 statements inappropriate and unjustified said it has informed the QFs an= d=20 the governor's office that it plans to begin paying the QFs in full going= =20 forward.=20 Davis said the PUC planned to issue an order next week directing the=20 utilities to prepay future bills to the QFs.=20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices which the state's 1996 deregulation= =20 law prevents them from passing on to ratepayers. California has been spendi= ng=20 about $45 million a day since January to buy power for the utilities'=20 customers but hasn't included QF-generated power in its purchases.=20 Keepers of the state's power grid were cautiously optimistic that Californi= a=20 might get through Wednesday without another day of rolling blackouts after= =20 two idle plants were returned to service. A Stage 1 power alert the mildes= t=20 of three forms of alerts was called around 6 a.m. Wednesday as power=20 reserves fell to around 7 percent.=20 About a half-million customers were hit by Tuesday's blackouts which snarl= ed=20 traffic and plunged schools and businesses into darkness from San Diego to= =20 the Oregon border. Tuesday's outages began at 9:30 a.m. and continued in=20 90-minute waves until about 2 p.m. when the ISO lifted its blackout order.= =20 They were blamed for at least one serious traffic accident.=20 The blackouts were caused by a combination of problems including=20 unseasonably warm weather reduced electricity imports from the Pacific=20 Northwest numerous power plants being shut down for repairs and the loss o= f=20 power from QFs.=20 Meanwhile a leading lawmaker on energy issues said the PUC may soon have t= o=20 raise rates by about 15% to cover the state's costs and its utilities' bill= s.=20 My sense is that people will appreciate having some certainty and being ab= le=20 to plan for it said Assemblyman Fred Keeley. They don't have to like it= =20 but I think they'll appreciate it.=20 Davis has said he is confident the utilities and the state can pay their=20 bills without further rate increases.=20 --- --- PG&E Says It Is Negotiating With Qualifying Facilities 03/21/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 (This article was originally published Tuesday)=20 =20 LOS ANGELES -(Dow Jones)- PG&E Corp. (PCG) unit Pacific Gas and Electric Co= .=20 said Tuesday it is offering small generators or qualifying facilities= =20 prepayment of $200 million per month so they will have the funds to return = to=20 the state power grid.=20 But high level sources at the qualifying facilities who are involved in the= =20 negotiations said PG&E's proposal is incomplete and doesn't address the iss= ue=20 of past due payments.=20 The sources said PG&E had discussions with some qualifying facility operato= rs=20 last week regarding the plan and it wasn't accepted at that time.=20 About 3000 megawatts of power from qualifying facilities or QFs have bee= n=20 off the state's grid since Monday because the generators weren't being paid= =20 by utilities and couldn't afford to continue operating. The QFs unavailable= =20 power was partly responsible for Monday and Tuesday's statewide rolling=20 blackouts.=20 Also Tuesday California Gov. Gray Davis will hold a press conference to=20 discuss progress made in negotiations with the QFs to revise their contract= s=20 with the state's two nearly-bankrupt utilities so that the utilities pay le= ss=20 for power.=20 Edison International (EIX) unit Southern California Edison also said Tuesda= y=20 it intends to make partial payments on an ongoing basis to some QFs.=20 Edison executives met with Gov. Gray Davis' negotiating team Tuesday to=20 discuss how and when SoCal Ed can begin to make payments and a spokesman= =20 said they hope to have a plan in a matter of days.=20 Pacific Gas & Electric Co. has made partial payments of about $51 million t= o=20 the QFs it contracts with but owes much more. Edison owes the QFs hundreds= =20 of millions of dollars and hasn't paid the QFs since November. Together th= e=20 two utilities owe QFs about $1 billion.=20 PG&E said it has been collecting about $400 million per month from ratepaye= rs=20 to pay QFs and other generators with which it has bilateral contracts the= =20 state grid operator for spot power purchases and costs of its own=20 generation.=20 The average combined bill for those costs exceeds $1.4 billion per month= =20 PG&E said.=20 This mismatch between revenues and costs requires tough choices. Since the= re=20 isn't enough money in rates to cover all these costs the Public Utilities= =20 Commission decision on how this $400 million will be allocated going forwar= d=20 will determine our ability to make advance payments to QFs said Gordon R.= =20 Smith the utility's president and CEO.=20 The PUC is responsible for implementing the legislation which allows the=20 state to buy power and will decide how much of utilities' ratepayer revenue= =20 will go to the state for power purchases and how much will go to the=20 utilities.=20 For several weeks a number of QFs have taken their generating units offlin= e=20 because they can no longer afford to buy fuel needed to run their units.=20 QFs supply California with one-third of its total power supply.=20 PG&E and SoCal Ed have almost $13 billion in purchased power undercollectio= ns=20 because they cannot collect full costs from customers protected by a=20 state-mandated rate freeze.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 -(Jason Leopold contributed to this article.)=20 --- -------------------- Wednesday March 21 2001=20 By Dave Todd=20 dtodd@ftenergy.com=20 U.S. Energy Secretary Spencer Abraham declared this week that the Big Apple= =20 is on the verge of being bitten hard by power cuts and rising energy prices= . Delivering the keynote address at the U.S. Chamber of Commerce's national= =20 energy summit in Washington Monday Abraham said California is not the on= ly=20 state facing a mismatch between supply and demand what with electricity= =20 shortages predicted for New York City and Long Island this summer and low= =20 capacity margins threatening electricity reliability elsewhere across the= =20 country. But how likely is it that New Yorkers will face blackouts of the= =20 sort confronting Californians?=20 Not very says energy trade specialist Edward Krapels managing director of= =20 Boston-based METIS Trading Advisors. Krapels a consultant helping major=20 Northeastern utilities such as Consolidated Edison design market-hedging= =20 programs adamantly decried what he said are facile comparisons between=20 conditions in New York and California there being more differences than= =20 there are similarities between those two industrial cornerstones of the=20 country's economy in respect to energy security management.=20 First of all New York has a more varied portfolio of energy generation=20 sources than California he said. California has hydro nuclear and gas b= ut=20 when it lost a lot of hydro the state needed gas to pick up the slack and= =20 the capacity just wasn't there. In New York's case the state has oil and= =20 coal still in the mix and its overall dependence on gas is much lower than= =20 California's Krapels added.=20 New York avoids making same mistakes Portfolio diversity is one pillar of any effective plan to help New York=20 avoid the same errors made in redesigning California's marketplace. New=20 York's Independent System Operator (ISO) in a new report warning that the= =20 state is at an energy crossroads in terms of its capacity adequacy in the= =20 immediate future argues that a concerted effort is required to arrest=20 declining in-state generation capacity reserve margins and a strategy must= =20 be put in place whether or not new generation comes on-line in accordance= =20 with current anticipated scenarios.=20 A measure of New York's essential difficulty is that between 1995 and 2000= =20 statewide demand for electricity grew 2700 MW while generating capacity= =20 expanded by only 1060 MW. With no major new generating plants in downstate= =20 New York fully approved the gap is expected to continue to widen. To avoid= =20 a replication of California's market meltdown the New York ISO calculates= =20 the state's daily generating capacity needs to grow by 8600 MW by 2005 wi= th=20 more than half of that located in New York City and on Long Island.=20 Expressing concern this may be too big a burden for the current bureaucrati= c=20 process to bear the ISO wants to see a state-appointed ombudsman named to= =20 help would-be merchant power plant investors plow through red tape.=20 Increasing New York's generating capacity will also lessen the state's=20 escalating and risky reliance on out-of-state sources of electricity the= =20 ISO added. Since 1999 New York State has been unable to cover its reserve= =20 requirements from in-state sources.=20 Not everyone agrees with that analysis insofar as it argues for circling t= he=20 wagons inward. Some analysts believe the ultimate solution lies not in tyin= g=20 in more inwardly dedicated power but in expanding the marketplace by=20 breaking down inter-jurisdictional barriers. In any case New York energy= =20 regulatory authorities and those responsible elsewhere in the U.S. Northeas= t=20 such as PJM (Pennsylvania-New Jersey-Maryland) Interconnection and the New= =20 England Power Pool are in vastly better shape in terms of cross-border= =20 cooperation than California and its neighbors in that efforts are being mad= e=20 among various authorities toward developing an integrated regional=20 electricity market. In California by contrast the state's focus=01*for=20 example in the case of new gas-fired power plant development=01*has been t= o=20 ensure dedicated supply to the California market alone rather than on a=20 regional marketplace.=20 The New York ISO's new broad-based analysis of market-restructuring needs= =20 argues that the relatively stronger health of its reformed environment is= =20 due in large part to the ability of New York's utilities to enter into=20 long-term power contracts.=20 What needs to be done most it says is to move aggressively to build some = of=20 the more than 29000 MW of proposed new generation in the siting pipeline.= =20 In the meantime the 30200 MW of electricity New Yorkers used on a peak da= y=20 last summer shouldn't be eclipsed on too many days this coming summer (give= n=20 early long-range weather forecasts). Demand however is expected to increa= se=20 at an annual average rate of up to 1.4%.=20 So while New York City the rest of the state and adjacent parts might=20 breathe easy this year it could be a brief rest from the fray. Meanwhile = a=20 4% shortfall is still being planned for this summer that is not yet provide= d=20 for as authorities hurriedly seek to arrange new generation plants around= =20 Manhattan on Long Island and even on barges offshore.=20 One way or another whether it is the weather or the politics of siting new= =20 energy facilities it's going to be a hot time in the city.=20 Long-term solutions hit brick wall Meanwhile attempts at longer-term solutions continue to run into trouble.= =20 Last week Connecticut state regulators came out against a proposal to run = a=20 new underwater cable under Long Island Sound that Hydro-Quebec subsidiary= =20 TransEnergie U.S. Ltd. wants to build to pump more juice into Long Island= =20 Power Authority's load pocket. Despite strong promises from TransEnergie to= =20 be diligent in avoiding damage to oyster beds in Long Island Sound the=20 proposal failed to convince authorities who were persuaded the pipeline=20 project could lead to diversion of electricity from Connecticut.=20 In similar fashion private companies wanting to build 10 small independent= =20 power plants and temporary generators offshore New York City are running in= to=20 intense opposition from environmental groups and citizen organizations=01*s= ome=20 of whom have taken their cases to the state assembly in Albany.=20 The David vs. Goliath nature of such controversies has further alerted ener= gy=20 companies to the difficulties of addressing complex energy supply issues th= at=20 may ultimately devolve to people not wanting things in their backyard=20 regardless of what the alternative might mean to their fellow citizens or t= he=20 greater public good.=20 But suddenly in New York California's troubles=01*while still distant in = their=20 intensity=01* may not be so far away. By some estimates this summer's bill= s for=20 Consolidated Edison customers could be up as much as one third or more over= =20 last year's charges.=20 Letting the time slip when it comes to building new infrastructure isn't=20 going to make the pain go away.=20 =20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Attached are FERC reports What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Breakfast presentation at MASS Plastics 97 conference, per Jennifer Arnold. Body:: CANCELLED...... What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Patent attorney Body:: Larry Thanks What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Rice Body:: Nelson I don't see any problems with #1. For number 2 mention that the paper was written when you were a studentt at Rice. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Inventory of Skills Confidential Inquiry: Joe Jamail Body:: VERY CONFIDENTIAL The following member has asked for help from the Inventory of Skills (IOS). You have been identified as one of the few members who has the skill to assist in this area. You may or may not have completed an IOS enrollment form. All information gathered for IOS is done on a confidential basis and will remain confidential. This member has no knowledge regarding who has been contacted. If you choose to help the necessary information follows so that you may contact this member directly. If you cannot assist this member please contact them or IOS. IOS asks that you please respond within 72 hours of receiving this request. Thank you Brenda Worley IOS does not evaluate the validity of any request. Name: Ted L. Dub Snider Jr. Chapter: Lone Star-Dallas Phone: 501-401-7601 Fax: 501-401-7628 Email: dsnider@connect.com Other: * Indicated preferred method of contact. My company has been severely damaged by $50 billion (revenues)Texas based company 1) refusal to pay monies owed under a contract. 2) misrepresenting information used to calculate amounts owed under the contract 3) appears to have instigated an FBI investigation of our company regarding a pending civil and regulatory dispute. I am looking for an introduction to Joe Jamail by someone who knows him. We need an attorney with the courage confidence and track record to successfully pursue our claim against a powerful adversary. Thank You. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Markets Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Barton Subcommittee Passes Energy Bill Without Electricity Amendments Body:: Late tonight the Barton Subcommittee passed an energy policy package (without any electricity provisions other than those related to conservation) on a bipartisan vote of 29-1. The subcommittee approved an amendment by Mrs. Wilson to conduct a national assessment and inventory of possible renewable energy projects. During consideration of the bill several amendments of interest and concern to Enron were offered and withdrawn they are likely to be offered when the full Energy and Commerce Committee meets to consider the package next Tuesday and Wednesday. The amendments in this category are: 1. Mr. Waxman has an amendment he called the blackout and price gouging prevention amendment that would require FERC to modify its June 19 price mitigation order within 15 days of enactment to impose cost-of-service based rates (with a rate of return of 15 percent) if an entity is found to be withholding power from the grid during an emergency. The cost-of-service rates would thereafter apply to all of the offending entity's sales in the Western U.S. Several of us were rounding up opponents to the amendment when it was clear he was going to offer it and before he decided to withdraw it until full committee. We will continue those efforts before the full committee vote. 2. Mr. Ganske has an amendment on net metering that he said would promote wind in Iowa and other renewables (he may wait until an electricity bill rather than full committee on this bill). 3. Mr. Shadegg has an amendment to exempt natural gas pipelines from the requirements of the National Registry of Historic Places. He said that currently this process holds up much needed pipeline expansions that are FERC approved. 4. Mr. Waxman has an amendment that would require the President to develop and implement a plan to achieve the greenhouse gas reductions called for in a UN agreement that President George Bush (41) agreed to in 1992 (reducing these emissions to 1990 levels). Chairman Barton indicated that the Subcommittee will take up an electric restructuring bill either later this month or early in September depending on how long it takes to process this first energy package in the full committee and in the full House. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Customers Body:: You may want to forward this to your customers. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Feedback from KL/JS CA Memo Body:: Perhaps we should consider putting something together on India? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Pricing Body:: For the call with Davis this am..... What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: India And The WTO Services Negotiation Body:: fyi ----------------- What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enrons policy on Libya Body:: I assume we avoid Libya completely. The question though may be how we proceed if we are doing business with someone who has activities in Libya. Your views please. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Next Corporate Policy Committee Offsite Body:: I think wholesale will be well covered. Enron Capital & Trade Resources Corp. From: Sherri Sera 04/26/2001 02:51 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: RE: Next Corporate Policy Committee Offsite How much of an issue is this? So far Mark is the only one that has responded with a conflict. Please advise. Thanks SRS ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: confidential employee information-dutch quigley Body:: thx Jeanie Slone 12/19/2000 04:51 PM To: John Arnold/HOU/ECT@ECT cc: Subject: confidential employee information-dutch quigley Dutch requested a meeting with me today and I gave him the scoop on the promotion. I will follow-up with him after our meeting the first week of Jan. He was ok with everything. let me know if you need anything else. ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential & Proprietary - PanNat Valuation Update (7.24.01) Body:: Jeff As requested below find the updated valuation assuming the contract is amended beginning September 1 2001 based on July 23 2001 curves Let me know if you have any questions. Eric What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Carin Energy Rumor Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Test Message Body:: Mike Thanks for your message. The meeting on Tuesday at 7 is confirmed. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: HP -- confidential internal document Body:: Good plan. I agree re SJ. She is on the ball. mh Patrick Tucker 12/14/00 04:28 PM To: Matt Harris/Enron Communications@Enron Communications cc: Dale Clark/Enron Communications@Enron Communications Subject: Re: HP -- confidential internal document I agree. Sarah-Joy and I had a detailed follow-on conversation today about this topic and we're in agreement as to how things can move forward. I'd definitely like to have Bill rejoin our conversation with our new overall commercial contact at HP whose name Greg Pyle and Bill Lovejoy will supply in the very near future. I understand that Peter Goebel was quite clear with HP in today's meetings regarding the imminent nature of his wireless decision the breadth of vendors with whom he could conceivably do business and the fact that the wireless deal and the Enron sell side are inextricably linked. Sarah-Joy mentioned that Gerry has not been present in the more recent conversations which we're taking to indicate that Bill and Greg understand that his focus was different than ours. Sarah-Joy has brought immense focus and organization to this process. I have certainly found her involvement invaluable. Patrick Matt Harris 12/14/00 10:51 AM To: Sarah-Joy Hunter/NA/Enron@ENRON cc: Dale Clark/Enron Communications@Enron Communications Jennifer Medcalf/NA/Enron@Enron Patrick Tucker/Enron Communications@Enron Communications Peter Goebel/NA/Enron@Enron Subject: Re: HP -- confidential internal document This is an excellent update. Thanks for putting this together. Dale/Patrick - lets regroup on how we want to move this onward. Seems like SJ's suggestion of our spending more time with Bill Dwyer is a good one. Thanks Matt Sarah-Joy Hunter@ENRON 12/12/00 02:42 PM To: Matt Harris/Enron Communications@Enron Communications cc: Patrick Tucker/Enron Communications@Enron Communications Peter Goebel/NA/Enron@Enron Dale Clark/Enron Communications@Enron Communications Jennifer Medcalf/NA/Enron@Enron Subject: HP -- confidential internal document Matt: As GSS Business Development transitions the HP relationship for broadband to your team there are several issues I wanted to clarify in terms of how the relationship has been developed and who the contacts have been to date. Additionally I outlined the discussion points/action items from this morning's meeting you held with Jennifer Medcalf and myself. Per your request the HP presentation complete with a listing of HP's business partners was e-mailed to you this morning. HP contacts to date: Bill Lovejoy Western Gulf Area Sales Manager Houston TX #(713)-439-5587 (Gerry Cashiola's boss) Gerry Cashiola sales representative Houston TX #(713)-439-5555 (To date HP person coordinating the relationship--seeking a short term play) Greg Pyle Solution Control Manager Southeast Region Austin TX (#(512)-257-5735 (Pyle has been playing the business developer role but continues to defer leadership of the process to Gerry Cashiola) Daniel Morgridge Manager of Internet - E-Services long term alliances Austin TX #(512)-257-5736 (Interested in E-services/wireless longer term alliances) Bill Dwyer Chief Architect e-Services Solutions Cupertino CA #(408)-447-5240 (To date clearly the most knowledgeable person on HP's business propositions strong technical financial background to craft value propositions. Gerry Cashiola and Greg Pyle deferred to his judgement in the 11/16th meeting) Matt On November 10th GSS Business Development took HP through a tour of Enron's trading floor the gas control center and the peaking power plant unit center on the trading floor. This tour was one meeting amongst several held in October and November to provide HP a full overview of Enron's products and services and introduce them to appropriate contacts at Enron (EBS GSS buy side -- Peter Goebel). On November 16th GSS Business Development Patrick Tucker and Dale Clark outlined 3 possible EBS/HP focus areas -- connectivity storage and wireless. Three EBS action items were defined in that meeting: 1) HP was to provide an HP contact on connectivity (to date Gerry Cashiola has stalled on providing this). Sarah-Joy will continue to pursue this information and get a sense from Gerry Cashiola of what he means by short term opportunity. What is HP's time horizon for short term? 2) EBS and GSS/BD was to facilitate a conference call on Storage with Ravi to explore size and potential scope of opportunity (completed 12/8) 3) GSS/BD was to facilitate a conference call with Peter Goebel GSS IT Sourcing Portfolio Leader (set for 12/14) In conversations with you Jennifer Medcalf and myself this morning several decisions on forward-looking strategy with HP/EBS were confirmed: Gerry Cashiola has been unable to take control of the process. More importantly despite numerous visits to Enron in which he has had overviews of Enron's products and services met with Peter Goebel and his team on the GSS buy side and participated in an Experience Enron tour Gerry has been unable to define an HP business proposition. The coordination between Cashiola (short term initiative) Morgridge (long term 12-24 months) has remained unorganized. These initiatives need to be developed separately. Clearly the conversations with HP need to be elevated to a more senior level so EBS can work with HP decision makers who can move the relationship forward at a strategic level. As the relationship is developed at this strategic level shorter term opportunities will crop up along the way. But Gerry's short term plans will not be the focus of the EBS/HP relationship rather a by-product. To facilitate this process of elevating the relationship Jennifer Medcalf and I are following up with Bill Lovejoy and Greg Pyle. Lovejoy's boss is Dan Sytsma VP of HP's America's Central Region. In the conference call Thursday 12/14 with Peter Goebel and HP regarding wireless initiatives Peter will support the GSS/BD push for the HP/EBS initiative by reiterating the following two points: a) Enron is already an HP customer the onus is on HP to move forward on the process of building a strategic relationship (IBM and Lexmark are only some of the HP competitors who could push them out of the running) b) HP's ability to bring the right people to the table will influence HP's business relationship process with Enron Patrick Tucker and Dale Clark could build their relationship with Bill Dwyer Chief Architect e-Services Solutions (met at the meeting 11/16) in the near term. Perhaps plan a visit to Cupertino California to see Dwyer in person. We look forward to continuing close collaboration with your team on this and other opportunities. Sarah-Joy Hunter Enron Corporation Global Strategic Sourcing - Business Development #(713)-345-6541 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: AP Wires Thurs 3/22: Report: Power wholesalers overcharged California $5.= 5=20 billion Dow Jones Newswires Thurs 3/22: Reliant To Appeal Fed Judge Ruling To Sel= l=20 Pwr To Calif Sac Bee Thurs 3/22: Federal judge orders major power wholesaler to sell t= o=20 California San Jose Mercury News Thurs 3/22: State falling short on pacts that provi= de=20 low-cost energy Contra Costa Times Thurs 3/22: Crisis saps state surplus Sac Bee. Fri 3/23: Bill to pay small energy firms stalls Sac Bee Fri. 3/23: House panel ends energy hearings -- will it step in? Sac Bee Fri 3/23: Dan Walters: Crisis deepens: politicos panic San Diego Union Fri. 3/23: Report says power wholesalers overcharged=20 state $6 billion San Diego Union Fri 3/23: Disappearing state surplus sparks alarm San Diego Union Fri. 3/23: Outages darken economic outlook in state so= me=20 say San Diego Union Fri. 3/23: Out-of-state generators question power=20 regulators' authority San Diego Union Fri. 3/23: Allegheny Energy makes big California=20 connection LA Times Fri 3/23: Judge Frees Small Firm From Edison Contract SF Chron Fri 3/23: Lodi Defies Order for Blackouts=20 Utility tells PG&E to 'pay the bills' SF Chron Fri 3/23: Coming Down to the Wire=20 State legislators battle over alternative energy bills SF Chron Fri 3/23: Grid Operators Push to Prevent Overcharging=20 They say regulators must be aggressive to stop billing abuses=20 Mercury News Fri. 3/23: State's bill for energy could double this year Mercury News Fri. 3/23: Plan for alternate power plants stalls --- --- Report: Power wholesalers overcharged California $5.5 billion=20 DON THOMPSON Associated Press Writer Thursday March 22 2001=20 2001 Associated Press=20 (03-22) 11:41 PST SACRAMENTO Calif. (AP) -- Electricity wholesalers have= =20 overcharged California more than $5 billion since May by manipulating the= =20 energy market according to a report prepared for power grid managers.=20 The Independent System Operator will file the findings with federal=20 regulators and ask for a refund ISO spokesman Patrick Dorinson said.=20 The state auditor also said Thursday that the state's 1996 deregulation law= =20 encouraged both buyers and sellers of electricity to ``manipulate wholesale= =20 prices to their advantage'' by underestimating supply and demand.=20 The auditor's report lays out what it calls ``a complex combination'' of=20 deficiencies and misjudgments it says led to the state's power problems.=20 According to the ISO report five in-state power suppliers and 16 importers= =20 frequently offered electricity at prices higher than it cost them to produc= e=20 -- effectively withholding supplies -- or didn't bid at all when they were= =20 able to generate power.=20 ISO Director of Market Analysis Anjali Sheffrin presented the findings at a= =20 conference in Berkeley last week.=20 The companies have denied overcharging California and have said they expect= =20 the Federal Energy Regulatory Commission will determine their prices were= =20 justified.=20 The commission has recently stepped up scrutiny of power companies' behavio= r=20 during California's power crisis asking suppliers to justify $124 million = in=20 sales during the first two months of the year or refund the money. Critics= =20 claim thousands of additional questionable sales are not being challenged.= =20 California has been spending about $45 million a day -- $4.2 billion since= =20 January -- to purchase power for Pacific Gas and Electric Co. and Southern= =20 California Edison. Both utilities the state's largest have been cut off b= y=20 electricity wholesalers because their credit is almost worthless.=20 Edison and PG&E say they are nearly $14 billion in debt due to soaring=20 wholesale power costs. The state's deregulation law blocks them from=20 recovering the costs from customers.=20 State Controller Kathleen Connell said Wednesday that the state's=20 power-buying is gutting its budget surplus.=20 Since the state started making emergency power buys the surplus has fallen= =20 from $8.5 billion to about $3.2 billion she said.=20 Connell ordered an audit of the power buys saying Gov. Gray Davis is=20 withholding key financial information from her office and the Legislature.= =20 She said she would refuse to transfer $5.6 billion into a ``rainy day fund'= '=20 she said was set up to impress Wall Street as the state prepares to issue $= 10=20 billion in revenue bonds to cover its power buys.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routin= e=20 and required by law.=20 ``The law says she has to do it. The law does not give her the power to=20 demand that kind of audit information'' Harrison said.=20 Davis spokesman Steve Maviglio said the administration has released the=20 financial information it can without jeopardizing negotiations for long-ter= m=20 power contracts with wholesalers.=20 Also Wednesday a federal judge ordered a major wholesaler Reliant Energy= =20 Services to continue selling power to California despite its fear that it= =20 will not be paid.=20 The ISO buys power from companies like Reliant on behalf of utilities in=20 attempts to fend off rolling blackouts like those that hit the state this= =20 week and during two days in January.=20 --- Reliant To Appeal Fed Judge Ruling To Sell Pwr To Calif 03/22/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LOS ANGELES -(Dow Jones)- Reliant Energy Inc. (REI) said Thursday it will= =20 immediately file with the 9th Circuit Court of Appeals in San Francisco in= =20 response to a federal judge's ruling late Wednesday that the company contin= ue=20 selling power to California regardless of whether it is paid.=20 U.S. District Court Judge Frank Damrell granted California's Independent=20 System Operator which makes last minute power purchases in the spot market= =20 a preliminary injunction against Reliant saying Californians were at risk = of=20 irreparable harm if Reliant stopped selling power to the state. The ISO manager of the state's electricity grid said the judge's ruling= =20 will allow the agency to keep the lights on in California.=20 Reliant which is owed more than $300 million from the state's cash-strappe= d=20 utilities supplies California with about 3000 megawatts of electricity fr= om=20 power plants it owns in the state.=20 Reliant spokesman Richard Wheatley said the state Department of Water=20 Resources the agency that buys California's bulk power needs on behalf of= =20 PG&E Corp. (PCG) unit Pacific Gas & Electric Edison International (EIX) un= it=20 Southern California Edison and Sempra Energy (SRE) unit San Diego Gas &=20 Electric should back the ISO's last minute power purchases.=20 In a filing with the Securities and Commission Reliant said it is owed $10= 8=20 million by the DWR for last minute power purchases the ISO made during the= =20 six weeks prior to the agreement Reliant made with the DWR.=20 Damrell dismissed Reliant's claim saying he does not have the authority to= =20 force the DWR to pay for that power.=20 We're going to immediately appeal Judge Damrell's order Wheatley said.= =20 Clearly the judge understands the implications of his order. We are requir= ed=20 to do business with creditworthy entities. Unfortuantely the judge did not= =20 force the ISO to post a surety bond which would allowed us to do business= =20 with the ISO.=20 Gov. Gray Davis has said the state is not responsible for the last minute= =20 power purchases the ISO makes despite a law passed authorizing the DWR to= =20 buy power on behalf of the utilities.=20 Wheatley added that the company will also seek relief on the issue at the= =20 Federal Energy Regulatory Commission. Damrell's ruling remains in effect=20 until the Federal Energy Regulatory Commission rules on the matter.=20 Separately Wheatley said a short-term power supply contract that Reliant= =20 signed with the DWR expired Monday and the DWR has not renewed the contract= .=20 A spokesman for the DWR would not comment on the issue.=20 -By Jason Leopold Dow Jones Newswires 323-658-3874=20 jason.leopold@dowjones.com --- --- ----------------------- Federal judge orders major power wholesaler to sell to California Updated: March 21 2001 - 8:23 p.m.=20 A federal judge issued a preliminary injunction Wednesday ordering a major= =20 electricity wholesaler to continue selling to California despite its fear= =20 that it will not get paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant Energy Services stopped selling power to the=20 Independent System Operator which oversees the state's power grid. The ISO= =20 buys last-minute power on behalf of utilities to fill gaps in supply to try= =20 to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The state has been spending about $50 million a day on power for Pacific Ga= s=20 and Electric Co. and Southern California Edison both denied credit by=20 suppliers after amassing billions of dollars in debts. The judge said he had no authority to force the DWR to pay for that power.= =20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 Damrell denied the ISO's request for preliminary injunctions against three= =20 other wholesalers Dynegy AES and Williams who agreed to continue selling= =20 to the ISO pending the FERC ruling.=20 Spokesmen for Reliant Dynegy AES and Williams were out of the office=20 Wednesday night and didn't immediately return calls from The Associated Pre= ss=20 seeking comment on the ruling.=20 The ISO went to court in February after a federal emergency order requiring= =20 the power sales expired. The judge then issued a temporary restraining orde= r=20 requiring the sales but dropped it after the suppliers agreed to continue= =20 sales to California pending his Wednesday ruling.=20 The ISO said it would lose about 3600 megawatts if the suppliers pulled ou= t=20 enough power for about 2.7 million households. One megawatt is enough for= =20 roughly 750 homes.=20 Grid officials said Reliant's share alone is about 3000 megawatts. Reliant= =20 said the amount at issue actually is less than a fourth of that because mo= st=20 of the power is committed under long-term contracts.=20 Reliant which provides about 9 percent of the state's power worries it=20 won't get paid due to the financial troubles of PG&E and Edison.=20 PG&E and Edison say that together they have lost about $13 billion since Ju= ne=20 due to soaring wholesale electricity costs that California's 1996=20 deregulation law bars them from passing onto customers.=20 At the same time the state has faced a tight electricity supply due in pa= rt=20 to California power plant shutdowns for maintenance and to a tight=20 hydroelectric supply in the Pacific Northwest.=20 Managers of the state power grid imposed rolling blackouts across the state= =20 Monday and Tuesday as supply fell short of demand. Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts. State Controller Kathleen Connell said Wednesday that the energy crunch als= o=20 imperils California's financial health. Connell said the state's power-buying on behalf of Edison and PG&E is is=20 gutting its budget surplus. Since the state started making emergency power= =20 buys in January the surplus has fallen from $8.5 billion to about $3.2=20 billion she said.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is refusing a request by Davis and the Legislature to transfer $5.6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its=20 power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism. Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 Also Wednesday a report by Davis' chief power negotiator appears to show= =20 that as much as 75 percent of the state's power purchases will have to be o= n=20 the expensive short-term market this summer said Sen. Debra Bowen D-Marin= a=20 del Rey chairwoman of the Senate Energy Committee.=20 The prices may be phenomenol she said particularly given predicted=20 hydroelectric shortages due to drought in the Pacific Northwest.=20 The report by David Freeman who is negotiating the state's long-term power= =20 contracts shows California has finalized 19 contracts and has 25 agreement= s=20 in principle. Freeman said DWR is continuing to negotiate other contracts. Bowen said FERC should impose short-term price caps or let generators to=20 charge enough to make a reasonable profit or we could be subject to enormo= us=20 price-gouging this summer.=20 -- Associated Press --- State falling short on pacts that provide low-cost energy=20 Published Thursday March 22 2001 in the San Jose Mercury News=20 BY CHRIS O'BRIEN AND JOHN WOOLFOLK=20 Mercury News=20 The state has signed low-cost contracts for just a third of the energy it= =20 needs this year raising the prospect that California could be forced to bu= y=20 much of its electricity this summer on the expensive spot market.=20 A spokesman for Gov. Gray Davis conceded Wednesday that the state will be i= n=20 trouble without more contracts but insisted California will meet its needs= =20 through conservation and additional long-term deals for cheap electricity.= =20 The state according to a report released Wednesday has fallen far short o= f=20 the governor's goal of filling almost all its electricity needs through suc= h=20 deals. In fact the state has lined up contracts for about half the amount= =20 Davis had projected earlier this month.=20 If the state has to rely heavily on the volatile spot market where the pri= ce=20 of electricity this summer could reach five times the state's contract pric= e=20 pressure could mount to raise the cap on the electricity rates consumers pa= y.=20 But Steven Maviglio the governor's spokesman said ``The governor has sai= d=20 he's committed to work this in the existing rate structure so that's the= =20 plan.''=20 In the report sent to state lawmakers the state Department of Water=20 Resources indicated that it had secured just more than 20 million=20 megawatt-hours for this year leaving it far short of the 60 million=20 megawatt-hours needed.=20 ``This is just a progress report'' Maviglio said. ``They did all this in= =20 three weeks which is pretty amazing when you think about it and we have a= =20 lot more to do.''=20 The state got into the power buying business in January supplying it to th= e=20 state's nearly bankrupt utilities.=20 The state negotiated long-term contracts with generators to supply that pow= er=20 at a reduced rate. Based on the report the state will pay an average of $6= 8=20 per megawatt-hour over the next 10 years -- significantly less than in=20 December when prices spiked higher than $300 per megawatt-hour but not as l= ow=20 as the $55 Davis hoped to reach.=20 Most of this power however won't be delivered until 2004. From 2004 to=20 2006 the Department of Water Resources estimates it has enough power unde= r=20 contract. Until then the amount falls short.=20 In 2001 it appears the state has about one-third of the power it needs. Th= e=20 gap closes to about half in 2002 and two-thirds in 2003.=20 At a news conference in Los Angeles two weeks ago Davis said the state wou= ld=20 have to buy only 30 to 45 percent of the power it needs this summer on the= =20 open market.=20 At the time critics said with only two-thirds of the power under contract= a=20 rate increase was almost inevitable. Even Davis' chief negotiator S. David= =20 Freeman offered a bleak assessment for the summer saying that all availab= le=20 electricity has already been sold.=20 ``We'll be subject to extremely high prices'' said Frank Wolak a Stanford= =20 professor who sits on a market committee for the Independent System Operato= r=20 the agency that runs the state power grid.=20 Wolak said there are two main hopes for avoiding a price increase this=20 summer: Federal officials could cap the wholesale price a step they've=20 resisted or Californians can conserve an unprecedented amount of power. --- --- ----------------------- Crisis saps state surplus POWER CRISIS=20 Controller moves to block a transfer of funds saying the $8.5 billion=20 surplus has been cut more than half since January=20 By Mike Taugher TIMES STAFF WRITER=20 The energy crisis has bled California's once-touted budget surplus by more= =20 than half since taxpayers began buying electricity two months ago leading = a=20 top state finance official Wednesday to order an audit of the power purchas= es=20 and block Gov. Gray Davis' plan to transfer funds into a reserve account.= =20 A booming economy last year produced a budget surplus that totaled $8.5=20 billion in January. But that figure now stands at about $3.2 billion=20 according to Controller Kathleen Connell.=20 We started this year with a generous budget surplus Connell said in a=20 statement announcing her decision to block what Davis administration=20 officials described as a routine transfer of surplus money. The energy=20 crisis has taken much of that away and this transfer on top of the=20 electricity purchases would put the fund at risk.=20 Meanwhile the Davis administration released a report by David Freeman the= =20 governor's chief negotiator on power purchases on the progress of executin= g=20 long-term agreements meant to stabilize the power buys.=20 According to the report only about 40 percent of the electricity needed fr= om=20 the open market this year has been lined up. That means the state could be= =20 forced to continue buying a substantial amount of power on the highly=20 expensive spot market and further drain its coffers.=20 And a key regulatory panel is scheduled next week to issue a ruling that=20 would determine how quickly state funds will be replenished when it decides= =20 what portion of electric bill payments should be allocated to the state=20 treasury a decision that could include a rate increase to fully repay=20 taxpayers without further crippling the state's two largest electric=20 utilities.=20 The Public Utilities Commission also will consider whether it will force th= e=20 utilities to pay alternative energy producers whose shutdowns this week=20 contributed to blackouts.=20 Connell's action underscores a growing nervousness over the sheer volume of= =20 money that is being poured into energy buys despite the fact that state=20 officials plan to replenish the treasury with up to $10 billion in loans th= at=20 will be repaid by electricity consumers.=20 The state has committed to spending $4.2 billion to date to keep lights on= =20 since taxpayers were forced in mid-January to take over electricity buys fr= om=20 the financially crippled utilities Pacific Gas & Electric Co. and Southern= =20 California Edison. Tax money is going out at a clip of about $50 million a= =20 day.=20 High prices already have brought PG&E and Edison to the brink of bankruptcy= =20 and now the state's surplus is at risk according to Connell.=20 In addition to requesting an audit and announcing her intention to delay th= e=20 transfer to the reserve account Connell said she wanted the administration= =20 to send her office more information about the electricity purchases.=20 Davis' representatives questioned Connell's authority in trying to block th= e=20 funds transfer which they called a routine accounting procedure and accus= ed=20 her of making political hay.=20 It is not helpful to the taxpayers or ratepayers or the people who just wa= nt=20 to keep the lights on it isn't helpful to have the situation muddied like= =20 this said Sandy Harrison a Finance Department spokesperson. We're sorry= =20 it came up in this manner.=20 Connell and the administration have butted heads in recent weeks. The=20 controller wants to post details of the state's electricity purchases on he= r=20 Web site a plan that have been delayed under pressure from Davis because o= f=20 the governor's concerns that releasing those details will allow power=20 generators and traders to sell at higher prices.=20 Harrison said administration officials believe Connell lacks the authority= =20 either to block the funds transfer to a reserve account or to audit the sta= te=20 water resources department.=20 Two days of widespread blackouts this week show how vulnerable the power gr= id=20 is to financial glitches. Although several factors combined to produce the= =20 blackouts state power officials say the outages could have been avoided if= =20 the utilities were paying their bills to alternative energy producers.=20 Many of those producers including clean-burning natural gas power plants= =20 wind solar and geothermal energy developers shut down enough production t= o=20 spell the difference between grid reliability and blackouts Monday and=20 Tuesday.=20 Davis called the utilities' failure to pay bills to those producers known = as=20 qualifying facilities immoral. The QFs were either unable to buy gas fro= m=20 their suppliers or were frustrated with the utilities' failure to pay them.= =20 The utilities hoarded billions of dollars since November without paying an= y=20 money out said Davis spokesman Steve Maviglio. They've got the money --= =20 we're pulling the trigger to make them pay it.=20 The utilities however say they are doing all they can to conserve enough= =20 cash to continue operating. Together they owe the QFs about $1.5 billion.= =20 Next week the PUC is scheduled to consider whether to force the utilities = to=20 heed Davis' demand to pay the QFs and it might also decide how much of=20 ratepayers' bill payments will be used to refund taxpayers for power buys.= =20 PG&E says that under a formula proposed by the administration the water=20 resources department would receive about 40 percent of the money collected= =20 from ratepayers for power purchases.=20 The rest of that money about $240 million would have to be divided among= =20 QFs existing power contracts operating PG&E's nuclear and hydroelectric= =20 plants and what hour-by-hour purchases the utility still must make on the= =20 spot market according to PG&E spokesman John Nelson.=20 There isn't enough to do that he said.=20 That is making it increasingly likely that electric bills will be hiked=20 according to a growing chorus of officials and experts.=20 Unless rates are raised Nelson said the only entity that can absorb a lac= k=20 of payment or a partial payment is the state treasury. Cutting off any othe= rs=20 will lead to electricity becoming unavailable and more blackouts he said.= =20 If they do it under existing rates -- given that the existing pool of mone= y=20 is not enough -- who doesn't get paid or who gets a partial payment? Nelso= n=20 said. What's the only entity left with wiggle room? The state.=20 Rate hikes are also a sticking point in negotiations to bail out the=20 utilities through purchase of their transmission lines and other assets=20 Maviglio said.=20 They want rate increases of significant magnitude and we're not going=20 there he said.=20 WE CAN TRIM STORY HERE IF NECESSARY BUT KEEP TAGLINES AT BOTTOM=20 About one-third the electricity needed by the customers of California's thr= ee=20 major utility companies is produced by the companies themselves one-third= =20 comes from alternative producers who use environmentally friendly technique= s=20 and one-third is bought on the open market.=20 The state stepped in to buy the one-third needed from the open market after= =20 the utility companies ran out of cash and credit in January to make the=20 purchases themselves.=20 But that electricity has proven to be enormously expensive and Davis has= =20 planned to lower those prices by committing to long-term purchases.=20 Freeman's report on the progress of those long-term purchases dated March = 15=20 but released this week said the state has finalized 19 contracts with seve= n=20 suppliers and reached 25 additional agreements.=20 Mike Taugher covers the environment and energy. Reach him at 925-943-8324 o= r=20 mtaugher@cctimes.com.=20 Staff writer Andrew LaMar contributed to this story. --- --- ----------------------- Bill to pay small energy firms stalls By Kevin Yamamura Dale Kasler and Jim Sanders Bee Staff Writers (Published March 23 2001)=20 A quickly melded proposal that would assure payments for alternative energy= =20 suppliers whose money woes contributed to power blackouts this week stalled= =20 Thursday in a divided Legislature.=20 The state Senate passed the bill AB 8x but with Republicans balking it w= as=20 rejected in the Assembly along party lines. Assembly leaders said they may= =20 try again today.=20 For most of Thursday lawmakers scrutinized legislation they had overhauled= =20 the night before to include Gov. Gray Davis' plan to force utilities to pay= =20 solar wind and small gas-fired suppliers. Such providers called qualifie= d=20 facilities or QFs provide more than 20 percent of California's=20 electricity and their shutdowns were partly to blame for rolling blackouts= =20 Monday and Tuesday.=20 Under the Democratic governor's plan the state Public Utilities Commission= =20 would determine prices at which alternative generators may sell power but= =20 legislation is needed to authorize the PUC action.=20 Lawmakers faced time pressures Thursday. They wanted to pass the bill quick= ly=20 so the PUC could act next week and legislators could embark Monday on an=20 annual three-day lobbying trip in Washington D.C.=20 Assembly Speaker Robert Hertzberg D-Sherman Oaks said the Republicans'=20 rejection of AB 8x could jeopardize more than $4 billion the state has spen= t=20 or allocated for electricity during the energy crisis.=20 Hertzberg said producers of alternative energy which are owed more than $1= =20 billion have threatened to drag debt-ridden utilities into involuntary=20 bankruptcy if the Legislature failed to pass the measure.=20 They said it and I believe it Hertzberg said. If such bankruptcies occu= r=20 he added the state with its multibillion-dollar debt would become just=20 another creditor in a pile of creditors.=20 But Assembly Republican leader Bill Campbell of Villa Park said the=20 finger-pointing is unfair. Passage of AB 8x would not necessarily prevent= =20 bankruptcies he said.=20 One alternative energy provider won a crucial court ruling Thursday that=20 staved off at least for a while threats by some creditors to haul one or= =20 both big utilities into bankruptcy court for nonpayment of bills.=20 CalEnergy Co. Inc. won the right to sell its geothermal power which was=20 contracted to Southern California Edison on the open market. CalEnergy sai= d=20 it is owed $45 million by Edison.=20 If the Imperial County judge hadn't ruled in CalEnergy's favor the company= =20 and seven other QFs were fully prepared to file an involuntary bankruptcy= =20 petition against Edison this morning said David Sokol chief executive of= =20 CalEnergy's parent MidAmerican Energy Holdings Co. of Des Moines Iowa.=20 That is currently off the table.=20 An involuntary bankruptcy proceeding would take California's energy crisis= =20 into uncharted territory although a bankruptcy judge would have the leeway= =20 to reject the filing.=20 Freed from its contract with Edison CalEnergy will move to sell its=20 electricity to people who will pay for it Sokol said.=20 Besides calming the bankruptcy movement temporarily the ruling also could= =20 prompt other alternative energy providers -- hundreds of which have shut do= wn=20 because of nonpayment by Edison and Pacific Gas and Electric Co. -- to foll= ow=20 CalEnergy's example and find other buyers for their electricity said Gary= =20 Ackerman of the Western Power Trading Forum an association of generators.= =20 Assembly Republicans said they felt the Senate's decision to package three= =20 important energy issues into a single bill was an attempt to ramrod=20 legislation through both houses.=20 We have to stand and say no Campbell said during floor debate.=20 Besides determining alternative generator payments the bill would change a= n=20 earlier law by capping the value of bonds the state may sell for power=20 purchases at $10 billion. It also would extend to large businesses an=20 existing rate cap in the San Diego Gas and Electric Co. service area.=20 And it would earmark a portion of rates paid by utility customers to fund t= he=20 state's ongoing power purchases. Within a week the state will have spent= =20 $4.2 billion on power since January.=20 Without the bill some legislators fear Pacific Gas and Electric and=20 Southern California Edison would be reimbursed before the state.=20 They have got (some) gall to go to the PUC and say they're going to go to= =20 court to keep our money -- to keep our money to pay off their creditors= =20 said Senate President Pro Tem John Burton D-San Francisco.=20 Most of the bill's controversy however centered on how the PUC would trea= t=20 gas-fired alternative generators.=20 The commission issued a revised draft decision Wednesday that would impose= =20 prices for qualifying facilities at $79 a megawatt-hour for five-year=20 contracts or $69 a megawatt-hour for 10 years.=20 But those producers that use natural gas -- representing about two-thirds o= f=20 the alternative energy providers in California -- spent Thursday arguing th= at=20 Davis' plan to rescue them would all but guarantee that they would go out o= f=20 business instead.=20 The plan -- ordering Edison and PG&E to pay them a fixed price for their=20 power -- would set rates well below the cost of natural gas they said.=20 Democratic lawmakers tried to assure such producers that the PUC would set= =20 prices that make business sense even obtaining a letter to that effect fro= m=20 Loretta Lynch who heads the commission.=20 Davis has vowed to fine Edison and PG&E if they don't pay alternative=20 producers for future deliveries. But Sokol said his company isn't convinced= =20 that Edison will pay.=20 Calling Edison a confrontive in-your-face nasty organization Sokol sai= d=20 the utility was sitting on $2 billion and not paying its bills. Edison i= n=20 a Securities and Exchange Commission filing Thursday said its debts outwei= gh=20 its cash reserves by $722 million.=20 The Senate sent the Assembly two other bills that deal specifically with=20 supply and demand. The first SB 5x would spend about $1 billion on energy= =20 conservation and low-income assistance programs. The other SB 28x would= =20 streamline siting procedures for power plant construction.=20 In separate energy-related matters Thursday the Assembly approved:=20 AB 21x which would allow businesses industries or other electrical=20 customers to negotiate private contracts with energy providers.=20 Nine energy bills designed to generate or save 665 megawatts of electricity= =20 -- including 345 megawatts this summer. One megawatt is enough electricity = to=20 light about 1000 homes.=20 The state put power emergencies behind it after dropping out of a Stage 1= =20 alert late Wednesday. The California Independent System Operator which=20 manages the state's power transmission grid was predicting no further aler= ts=20 this week. It expected cooling temperatures and a regular dropoff in=20 electricity use on Fridays to lessen demand at the same time that more pow= er=20 plants were returning to service.=20 Bee staff writer Carrie Peyton contributed to this report.=20 --- House panel ends energy hearings -- will it step in? By David Whitney Bee Washington Bureau (Published March 23 2001)=20 WASHINGTON -- A key House panel wrapped up a series of hearings on the=20 California electricity crisis Thursday and now will decide whether to come = to=20 the state's aid with legislation.=20 But the panel's Texas chairman made clear that West Coast price controls=20 won't be on the table.=20 Caps will not be in anything I am submitting said Rep. Joe Barton=20 chairman of the House Energy and Commerce Committee's energy and air qualit= y=20 subcommittee.=20 Some form of federal controls to hold down escalating wholesale prices this= =20 summer because of power shortages has been the most frequent appeal of=20 witnesses who testified before the panel during roughly 30 hours of hearing= s=20 over five days.=20 Such controls have been sought by the governors of California Oregon and= =20 Washington. As power shortages are forecast for other regions states like= =20 New York also have appealed for temporary price controls to halt gouging.= =20 But the Federal Energy Regulatory Commission which is responsible for=20 enforcing reasonable wholesale rates under the Federal Power Act has refus= ed=20 to impose them and the Bush administration is bolstering that decision by= =20 opposing any legislation that would compel such action.=20 Barton in a brief hallway interview declined to say what other legislativ= e=20 remedies he might propose to address the worsening California situation.=20 He said he expects to submit a list of ideas to the White House today and= =20 after receiving comment on it sit down with other committee Republicans an= d=20 Democrats next week to see if any legislation is in order.=20 If we are going to do anything to help California or the West this summer= =20 we have to make it law within the next month or six weeks Barton said.=20 Even the panel's senior Democrat Virginia Rep. Rick Boucher was urging a= =20 careful and deliberate approach to the California crisis which he said w= as=20 largely of the state's own making.=20 There are steps Congress might take to provide some help to the West such = as=20 more money for conservation and relaxed federal regulation of air quality= =20 standards. That would permit older more polluting generators to operate=20 through a long hot summer when electricity demand could exceed supply by= =20 about 3000 megawatts roughly the amount needed to power 3 million homes.= =20 But Alan Lloyd chairman of the California Air Resources Board said power= =20 production already is being maximized without sacrificing air quality.=20 Simply put no essential electricity generation has been curtailed due to= =20 air emission limitations he said. California's programs to protect publi= c=20 health are not major factors in the electricity shortages experienced to=20 date.=20 The concern is that as shortages turn into more rolling blackouts wholesal= e=20 prices will jump even higher and steadily bleed the economies of California= =20 and the West Coast.=20 William L. Massey the lone member of the energy regulatory commission who= =20 supports price controls said at a Tuesday hearing that without them the We= st=20 Coast faces economic catastrophe this summer.=20 It was evident from the comments of some Republicans that they think their= =20 party could capitalize politically from a difficult summer.=20 If they had a bad summer it could show up in the polls said Rep. Charli= e=20 Norwood R-Ga. And sometimes that's not a bad idea.=20 One of the most dramatic exchanges during the weeklong hearings came Thursd= ay=20 with S. David Freeman the former general manager of the Sacramento Municip= al=20 Utility District who now heads the Los Angeles Department of Water and Powe= r.=20 He recently was named Gov. Gray Davis' chief negotiator with power generato= rs=20 for long-term contracts to stabilize future deliveries.=20 Don't feel sorry for California Freeman said. We're going to come out o= f=20 this stronger than ever.=20 But Freeman said it will be a year or two before all the fixes are in place= =20 and in the meantime the region desperately needs Congress' help to force th= e=20 FERC into controlling wholesale prices which witnesses said are likely to= =20 rise from $7 billion last year to as much as $70 billion or more this year.= =20 We recognize that the current administration and various legislators have= =20 their own opinion as to the California situation Freeman said. But my=20 personal plea is that if the federal government is not going to help us th= e=20 least it should do is refrain from legislation that attempts to tell us wha= t=20 to do.=20 Barton perked up at that idea.=20 Leave California alone huh? Barton said. That might be a good motto.= =20 --- --------------------- Dan Walters: Crisis deepens: politicos panic (Published March 23 2001)=20 That choking sound you hear is California's political class shifting into= =20 near-panic mode as it realizes that the energy crisis is on the verge of=20 becoming a full-scale meltdown with utilities forced into bankruptcy and= =20 consumers hammered by severe and prolonged power blackouts and soaring=20 electricity bills.=20 The Legislature which had been content to allow Gov. Gray Davis to handle= =20 the crisis on his own suddenly came to life Thursday jolted by this week'= s=20 unexpected rolling blackouts and threats by creditors to force the utilitie= s=20 into bankruptcy court. Lawmakers quickly fashioned a basketful of legislati= on=20 aimed -- or so they hope -- at increasing power supplies promoting=20 conservation and relieving the financial pressure on utilities and=20 electricity generators. But it may be too little too late -- and Davis and= =20 other politicians are already pointing fingers of blame aware that a=20 political price will be paid if the apocalypse strikes.=20 While Davis chants his mantra that he inherited a fatally flawed utility=20 deregulation scheme from predecessor Pete Wilson Republicans are blaming= =20 Davis for moving too slowly after the crisis first surfaced last summer an= d=20 even some of Davis' fellow Democrats are distancing themselves from the=20 governor.=20 Deregulation was a product of a Republican governor a Republican author a= nd=20 a Republican PUC (Public Utilities Commission) that was unduly impatient= =20 Davis said at one point this week as the Capitol buzzed with private=20 negotiations and public posturing.=20 A day later however state Controller Kathleen Connell a Democrat issued= a=20 warning that Davis' power purchases running at $50 million a day had=20 already drawn down state budget reserves by nearly two-thirds and she=20 refused to authorize additional transfers. It was a direct shot by Connell = at=20 Davis an old rival and came just a day after the governor had endorsed a= =20 Connell foe Antonio Villaraigosa in the duel for mayor of Los Angeles.=20 Other Democrats didn't join Connell's direct challenge to Davis but there= =20 is nevertheless a growing concern among Democratic legislators that the= =20 power purchases are costing many billions of dollars more than the governor= =20 had projected and could place the state budget in jeopardy. They're nervous= =20 because Davis has refused to reveal even to legislators exactly how much= =20 power the state is buying each day and how much it is paying.=20 From the few details that have been disclosed it's clear that the state is= =20 spending about $1.5 billion a month which would wipe out the state's=20 reserves by midsummer. It's also becoming increasingly clear that Davis=20 probably can't make good on his promise to avoid major consumer rate=20 increases unless the state is willing to plunge deeply and semi-permanentl= y=20 into debt to underwrite wholesale costs or unless federal authorities orde= r=20 huge refunds from power suppliers.=20 Rates in areas served by private utilities have risen only slightly while t= he=20 costs first to utilities and later to the state soared. Data from the=20 administration and utilities when collated indicate that the state is in= =20 line to collect just 20 cents for every dollar it's spending on power=20 purchases and the gap will increase as summer heat drives up demand.=20 Privately some economists say that private utility rates will have to rise= =20 33 percent to 50 percent to cover costs of current power supplies plus=20 utilities' past debts to generators and the state's purchase of the=20 utilities' transmission system if that deal is made final.=20 It's ultimately going to break down and the ratepayer is going to pay for= =20 it one way or the other Republican Sen. Jim Battin said during one of=20 Thursday's many committee hearings on utility legislation. No one disagreed= =20 with him.=20 DAN WALTERS' column appears daily except Saturday. Mail: P.O. Box 15779= =20 Sacramento CA 95852 phone (916) 321-1195 fax: (781) 846-8350 E-mail: dwalters@sacbee.com Recent columns: --- Report says power wholesalers overcharged state $6 billion=20 By Don Thompson ASSOCIATED PRESS=20 March 22 2001=20 SACRAMENTO =01) Electricity wholesalers have overcharged California more th= an=20 $6.2 billion by manipulating the energy market according to a report by an= =20 economist working for power grid managers.=20 The Independent System Operator planned to file the findings with federal= =20 regulators Thursday and ask for a refund said ISO spokesman Patrick=20 Dorinson.=20 In a related development the state auditor said Thursday that the state's= =20 1996 deregulation law encouraged both buyers and sellers of electricity to= =20 manipulate wholesale prices to their advantage by underestimating both=20 supply and demand.=20 Disappearing state surplus sparks alarm=20 Outages darken economic outlook in state some say=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 The auditor's report lays out what it calls a complex combination of=20 deficiencies and misjudgments it says led to the state's power problems.=20 The ISO's filing came a day after the state controller complained that a=20 relentless energy crisis is jeopardizing California's financial future.=20 Since May the companies manipulated the market by bidding at excessive=20 prices effectively withholding supplies or by not bidding at all when they= =20 had generation capability available according to the ISO study.=20 ISO Director of Market Analysis Anjali Sheffrin presented the findings at a= n=20 energy conference at the University of California Berkeley last week.=20 The companies have denied overcharging California and have said they expect= =20 the Federal Energy Regulatory Commission will determine their prices were= =20 justified.=20 In a burst of activity after weeks of delay both houses of the Legislature= =20 approved bills Thursday designed to ease the energy crisis.=20 The state Senate approved measures to encourage energy conservation and spe= ed=20 up power plant construction.=20 Topping that the Assembly sent the Senate 14 energy-related bills includi= ng=20 $455 million in loans and grants to encourage energy efficiency and=20 conservation and alternative energy projects by this summer.=20 One of the Assembly bills would require new energy plants approved by the= =20 state to sell their power within California before they offer it to other= =20 states.=20 The (California) Energy Commission says for every day we delay this bill= =20 there are 20 megawatts that could be saved that we're not saving said sta= te=20 Sen. Byron Sher D-Stanford as senators voted 28-10 to send his conservati= on=20 measure to the Assembly.=20 Senators also approved another Sher bill speeding up the siting of power=20 plants. It went to the Assembly on a 37-1 vote.=20 Meanwhile a federal judge issued a preliminary injunction Wednesday orderi= ng=20 one of the companies named in the ISO filing Reliant Energy Services to= =20 continue selling to California despite its fear that it will not be paid.= =20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant stopped selling power to the ISO which buys at= =20 the last minute on behalf of utilities to bolster supplies and try to fend= =20 off blackouts.=20 Such blackouts struck the state twice this week shutting off power to=20 hundreds of thousands of people from San Diego to Oregon snarling traffic= =20 and shutting down businesses.=20 The state remained free of any power alerts Thursday morning as power=20 reserves stayed above 7 percent.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= =20 Southern California Edison and Pacific Gas and Electric Co.=20 The judge said he had no authority to force the DWR to pay for that power.= =20 The utilities have been denied credit after amassing billions of dollars in= =20 debt paying high prices for power that the state's energy deregulation law= =20 prevents them from passing on to consumers.=20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power the ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 In another development Wednesday state Controller Kathleen Connell=20 complained that the energy crunch is imperiling California's financial=20 health.=20 Connell said the state's power buying on behalf of Edison and PG&E is gutti= ng=20 its budget surplus. Since the state started making emergency power buys in= =20 January the surplus has fallen from $8.5 billion to about $3.2 billion sh= e=20 said.=20 Connell ordered an audit of the state's power buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is also refusing a request by Davis and the Legislature to transfer $5.= 6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its power= =20 buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Connell is a candidate for mayor of Los Angeles in next month's election.= =20 The ISO study meanwhile covered five major in-state power suppliers =01)= =20 Reliant Dynegy Williams/AES Duke Energy and Mirant as well as 16 power= =20 importers. All deliver power to customers of Edison PG&E and San Diego Gas= &=20 Electric Co. the state's three largest investor-owned utilities.=20 All overcharged but some excessively and some by moderate amounts said= =20 ISO's Sheffrin.=20 According to the report the overcharging took place beginning last May wh= en=20 the energy crisis began and continued through last month.=20 During that time according to the report energy suppliers commonly offere= d=20 their electricity at twice the amount it cost them to produce.=20 FERC member William L. Massey said he wasn't shocked to hear the amount=20 overcharged added up to more than $5 billion.=20 Prices over the past 10 months in California have greatly exceeded the=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said.=20 Chuck Griffin spokesman for Atlanta-based Mirant said the company would=20 justify their charges to FERC officials.=20 I think we're missing sometimes just how basic the problem is in Californi= a.=20 Supply and demand are out of whack and some basic rules of economics kick i= n=20 when that happens he said.=20 --- ------------- Disappearing state surplus sparks alarm=20 Controller puts hold on transfer of $5.6 billion to reserve funds By Karen Kucher and Ed Mendel=20 UNION-TRIBUNE STAFF WRITERS=20 March 22 2001=20 The state's general fund surplus has dropped to $3.2 billion from $8.5=20 billion since January largely because California's power purchases are=20 devouring the money state controller Kathleen Connell said yesterday.=20 Connell said she wants to see more documentation about state power spending= =20 before approving the transfer of $5.6 billion from the general fund to a=20 special reserve fund requested by Gov. Gray Davis.=20 Connell said the state would have to borrow $2.4 billion to cover the=20 transfer.=20 Report says power wholesalers overcharged California $5.5 billion=20 Outages darken economic outlook in state some say=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 We started this year with a generous budget surplus. The energy crisis has= =20 taken much of that away and this transfer on top of the electricity=20 purchases would put the (general) fund at risk Connell said in a statemen= t.=20 Her action came on a day when state power supplies improved. After two days= =20 of forced outages this week no rolling blackouts were ordered yesterday.= =20 Several power plants came back on line and imports from the Pacific Northwe= st=20 provided enough electricity to meet demand yesterday said Stephanie=20 McCorkle a spokeswoman with the California Independent System Operator=20 which manages most of the state's power grid.=20 Gradually more (electricity) generation comes on every day McCorkle said= .=20 By Monday we should see somewhere around 2200 megawatts back in service= =20 that was not on this Monday. That's if no other generation falls off.=20 Meanwhile Connell's move took some by surprise.=20 A spokesman for the state Department of Finance said Connell is denying a= =20 routine transfer that is required by law. It was just a routine accounting= =20 measure that we didn't anticipate becoming controversial Sandy Harrison= =20 said.=20 Connell announced the denial of the transfer a day after Davis endorsed one= =20 of her opponents former Assembly Speaker Antonio Villaraigosa in the race= =20 for Los Angeles mayor.=20 Connell who monitors California's cash flow said she was deeply concerne= d=20 about putting the state's general fund in a deficit situation in light of t= he=20 energy crisis.=20 About two months ago the state began spending about $50 million a day to b= uy=20 power after Pacific Gas and Electric and Southern California Edison nearly= =20 went bankrupt. It is also purchasing power for customers of San Diego Gas a= nd=20 Electric.=20 The Davis administration said earlier this week it soon will begin spending= =20 an additional $500 million on power purchases bringing the total to $4.2= =20 billion.=20 As that staggering sum continues to grow the state won a court battle with= =20 an electricity supplier yesterday. A federal judge in Sacramento sided with= =20 the state and ordered the wholesaler to continue selling to California=20 despite its fear that it will not get paid.=20 Judge Frank C. Damrell Jr. said Californians were at risk of irreparable ha= rm=20 if Reliant Energy Services stopped selling power to the Independent System= =20 Operator. The ISO acquires last-minute power on behalf of utilities to fill= =20 gaps in supply to try to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The judge said he had no authority to force the DWR to pay for the power.= =20 Davis has said the state isn't responsible for purchasing the costly=20 last-minute power the ISO buys for Edison and PG&E despite a law authorizi= ng=20 state power purchases on the utilities' behalf.=20 Meanwhile those who manage the power grid say the forecast for power=20 supplies this week looks good although conditions can change quickly.=20 ISO managers continue to stress the importance of conservation. Utility=20 customers across the state conserved about 900 megawatts of power Tuesday= =20 which kept blackouts from being ordered that night.=20 As the power crisis worsened this week ISO managers wished aloud that they= =20 still could rely on business customers to shut down in exchange for lower= =20 energy rates.=20 Such interruptible customers saved as much as 2100 megawatts last spring= =20 a figure that dropped to about 1700 last summer and 1400 at the end of th= e=20 year. But in January the state Public Utilities Commission told utilities= =20 they could no longer impose fines on business customers who refuse to shut= =20 down when asked.=20 ISO managers realize the program was harming businesses with frequent=20 interruptions of service -- but they still miss having that option McCorkl= e=20 said.=20 It would have made an enormous difference but at the same time we=20 understand the impact it was having on businesses McCorkle said. --- -------------- Outages darken economic outlook in state some say=20 By Dean Calbreath? UNION-TRIBUNE STAFF WRITER=20 March 22 2001=20 Until this week the San Diego Regional Chamber of Commerce was predicting= =20 that the county was well-insulated from the growing threat of economic=20 recession.=20 But that was before the lights went out in the chamber's downtown=20 headquarters Monday.=20 Working by window light in his darkened office chamber economist Kelly=20 Cunningham rapidly erased his previous projections for 3.5 percent growth f= or=20 San Diego County. Cunningham now feels the local economy could fall into a= =20 recession thanks to its shaky supply of energy.=20 Report says power wholesalers overcharged California $5.5 billion=20 Disappearing state surplus sparks alarm=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 Blackouts are very disruptive to the economy Cunningham said. A busines= s=20 can absorb rising energy prices by cutting costs or raising its own prices.= =20 But an energy shutoff is much less predictable. It cuts into productivity.= =20 Those sentiments are being echoed throughout California as business leader= s=20 and economists worry that rolling blackouts will darken the state's=20 previously glowing economy.=20 At the University of California Los Angeles for instance leading financia= l=20 theorists will meet April 4 to discuss the question Can California grow in= =20 the dark? Although the topic was chosen before the recent string of power= =20 outages the blackouts have given the issue new urgency.=20 These blackouts are not just a single episode said UCLA economist Tom=20 Lieser. They are a bridge to what will happen this summer. If we don't fal= l=20 into a recession in the second half of the year we will fall pretty close.= =20 Tapan Munroe an economist formerly with Pacific Gas and Electric this wee= k=20 crossed out his projection for 2 percent statewide growth. After blackouts= =20 rolled toward his consulting offices in the Bay Area city of Moraga Munroe= =20 decided the state will be lucky if it manages zero growth.=20 I'm a pretty optimistic guy by nature but this has been sobering Munroe= =20 said. On Tuesday one restaurant alone in San Francisco lost $20000.=20 Multiply that by all of the businesses that lost power in the state and=20 you've got a serious problem.=20 Two days of blackouts in San Diego County have hurt businesses large and=20 small. Among the industries under threat is the local biotechnology sector= =20 which requires a steady supply of electricity to power areas of laboratorie= s=20 that must remain temperature-controlled and sterile.=20 Continued blackouts could have a huge impact not only in dollars but=20 multiple millions of dollars said Tom Oster vice president of operations= =20 for BioCom the leading trade organization for the more than 200 biotechs i= n=20 San Diego County.=20 Idun Pharmaceuticals a biotech near La Jolla Village Drive that has 67=20 employees had its power cut for about 40 minutes Tuesday. Though the compa= ny=20 has a back-up generator some segments of its laboratories and lab equipmen= t=20 were not supported by it. Chemists also had to turn off some sensitive lab= =20 equipment to avoid the possibility of a damaging power surge once the=20 blackout was over.=20 We're not in a position as a small company to back up the whole facility= =20 said Steven Mento Idun's chief executive. We haven't done a survey yet to= =20 determine whether we had losses either in experiments or equipment damaged= =20 -- but we're hoping because the blackout was so short that damage will be= =20 minimal.=20 Mento said rolling blackouts coupled with continuing high energy costs=20 could cripple many small biotechs -- and even take a bite out of bigger mo= re=20 established companies.=20 We generate new compounds in controlled environments on a daily basis and= =20 when power goes off you can lose samples because of contamination and other= =20 issues Mento said. We are fortunate that our losses would be in having t= o=20 repeat an experiment -- but this could be really critical for companies wit= h=20 drug manufacturing and issues of quality control.=20 The wireless firms along Sorrento Valley have not been immune from blackout= s.=20 The lights went out at Qualcomm early this week although executives declin= ed=20 to comment about the impact.=20 No blackouts hit the big shipbuilding operations on the waterfront this wee= k.=20 But the National Steel and Shipbuilding Co. -- one of San Diego's largest= =20 employers -- already experienced a voluntary loss of power this year its= =20 first since World War II. Since the shipyard does not have its own power=20 supply NASSCO executives fear the effect of unplanned outages.=20 Our average payroll totals half a million dollars a day said NASSCO=20 spokesman Jim Scott. When you have a day's work disrupted that can be=20 pretty serious. We're currently in discussions about the possibility of=20 buying from independent power suppliers or setting up a power plant of our= =20 own.=20 Small businesses which constitute the bulk of employment in San Diego=20 County were hurt by disruptions as well -- costing them vital revenue at a= =20 time when their power bills have skyrocketed.=20 At Fantastic Sam's a hair salon in Chula Vista Angelica Alcala estimated= =20 that business dropped 60 percent when the blackouts hit Tuesday. Among othe= r=20 things Alcala had to alter her planned haircuts because she was relying on= =20 scissors instead of electric clippers.=20 At the Family Fun Center in El Cajon the management gave vouchers or refun= ds=20 to the 15 or so video-game players who were in the midst of killing aliens = or=20 fighting ninja warriors as the power went down.=20 Papa John's Pizza estimates that it may have lost several thousand dollars = in=20 business after six stores were blacked out Monday and four others lost powe= r=20 Tuesday. Brian Mills who runs 23 Papa John's stores in the county said hi= s=20 main concern was shutting down the computers so they would not be damaged b= y=20 a power surge when the electricity was restored.=20 Paul Ecke III a member of the West Coast advisory panel for the Federal=20 Reserve said the potential impact of the energy crisis is worse than any= =20 downturn in the stock market.=20 Ecke who runs the Paul Ecke Ranch flower operation in Encinitas said the= =20 crisis could be particularly harmful for the state's agricultural sector= =20 since farmers need electricity to pump water and natural gas to heat=20 greenhouses.=20 What I'm really worried about is the energy thing is going to cast a shado= w=20 on California he said. If you're a business person thinking about moving= =20 to California right now you're probably not going to do it because you're= =20 not sure you're going to have your lights on this summer.=20 Besides the disruption to businesses the energy crisis is also hurting the= =20 pocketbooks of hourly workers who have been sent home during the crisis.=20 Under state law employers are free to send hourly workers home without pay= =20 during such emergencies although salaried workers must still be paid.=20 Susan Kemp an attorney with the California Chamber of Commerce said there= =20 are ways of minimizing the impact on hourly workers.=20 You have to look at what time it is when the blackout occurs and how long= =20 you think it's going to last Kemp said. If it's around a meal time you= =20 might send the workers out for a longer meal period if you think it's going= =20 to be an hour or hour and a half delay.=20 But the potential for losing wages doesn't sit well with the hourly workers= .=20 When you get sent home early and lose your wages you have even less money= =20 to pay your inflated energy bills said an hourly worker who was sent home= =20 during Monday's blackout.=20 --- ---------- Out-of-state generators question power regulators' authority=20 By Karen Gaudette ASSOCIATED PRESS=20 March 22 2001=20 SAN FRANCISCO =01) At least three major out-of-state electricity generators= are=20 challenging the authority of the California Public Utilities Commission to= =20 investigate whether they deliberately reduced power supplies to drive up=20 prices.=20 The PUC has asked for power plant maintenance records as it tries to=20 determine whether Duke Energy Dynegy Inc. Mirant Corp. and other=20 wholesalers have manipulated the energy market at California's expense.=20 At issue is who ultimately controls oversight of in-state plants that provi= de=20 most of California's electricity. The plants once owned by the state's=20 largest utilities were sold off as part of the state's 1996 attempt at=20 deregulation.=20 Report says power wholesalers overcharged California $5.5 billion=20 Disappearing state surplus sparks alarm=20 Outages darken economic outlook in state some say=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 PUC President Loretta Lynch said the public deserves to know whether=20 generators have unnecessarily taken plants off-line to create artificial=20 shortages forcing the utilities and now state bureaucrats to buy much high= er=20 priced power on the spot energy market.=20 What I do know is we have historically high levels of outages across the= =20 board Lynch told The Associated Press. Dynegy and Duke have been fightin= g=20 the PUC in the PUC's quest to obtain documents about these outages.=20 The PUC has the authority to regulate facilities within its borders she=20 added. It doesn't matter where the headquarters of the company is.=20 Duke based in North Carolina says it does matter =01) and that since it a= nd=20 other wholesalers aren't headquartered in California the PUC can't require= =20 it to turn over the maintenance records.=20 We have not given them proprietary information because they do not regulat= e=20 us said Duke's spokesman Tom Williams.=20 Dynegy did not return calls for comment Wednesday.=20 The PUC also faces a new challenge in the legislature. A bill sponsored by= =20 Assemblywoman Carole Migden D-San Francisco which would have granted the= =20 PUC greater inspection authority over out-of-state generators was amended= =20 this month to grant the authority to Independent System Operator instead.= =20 The ISO has managed the delivery of energy through most of the state's powe= r=20 grid but historically has done little regulating and has had no policing=20 authority.=20 This board created during the state's 1996 attempt at deregulation was=20 redesigned in January. Now it has a five-member board appointed by Davis= =20 replacing a 26-member ISO board composed of utility executives marketers= =20 power plant owners and others.=20 The latest version of Migden's bill requires wholesalers to report monthly = to=20 the ISO about any plants that are off-line or working at reduced capacity= =20 and gives the ISO power to audit these reports.=20 But because the ISO board historically has made key decisions behind closed= =20 doors and is exempt from certain open-government regulations government=20 watchdogs are outraged by the switch.=20 The PUC's been no friend of ratepayers but at least under the constitutio= n=20 and state law they're required to conduct their process in the open and the= =20 public can intervene said Harvey Rosenfield of the Foundation for Taxpaye= r=20 and Consumer Rights.=20 Davis ordered last month that the ISO take the lead among state agencies to= =20 ensure adequate energy supplies. Alan LoFaso an aide to Migden said the= =20 amendment follows Davis' lead.=20 Both LoFaso and the governor's spokesman Steve Maviglio downplayed the=20 change. I don't know if we have a preference as to which state agency get= s=20 the authority to continue the probe Maviglio said.=20 The challenge by Duke Energy Houston-based Dynegy Inc. and Mirant Corp. of= =20 Atlanta came in filings March 12 asking for a rehearing of the PUC's Februa= ry=20 resolution reasserting its legal authority to examine the books accounts= =20 memoranda contracts and records of generators selling energy to utilities= =20 already subject to PUC regulation.=20 Those utilities include Pacific Gas and Electric Co. and Southern Californi= a=20 Edison Co. which have been nearly bankrupted buying power from wholesalers= =20 as well as the financially troubled San Diego Gas and Electric -- Allegheny Energy makes big California connection=20 ASSOCIATED PRESS=20 March 22 2001=20 HAGERSTOWN Md. =01) Allegheny Energy Inc. said Thursday it has agreed to s= ell=20 $4.5 billion worth of power to California's electricity-purchasing agency= =20 over the next 10 years.=20 The company said the contract call for Allegheny to provide up to 1000=20 megawatts that the Hagerstown-based company has secured from western=20 generating plants through its new energy trading division Allegheny Energy= =20 Global Markets =01) formerly Merrill Lynch Global Energy Markets.=20 This is a win-win for both the state of California and Allegheny Energy. I= t=20 provides a long-term source of fixed-price energy and should help to=20 stabilize prices in California said Michael P. Morrell president of the= =20 Allegheny Energy Supply division.=20 --- ----------- Judge Frees Small Firm From Edison Contract=20 By KEN ELLINGWOOD and DAN MORAIN Times Staff Writers=20 ?????EL CENTRO--California's balance of electrical power shifted slightly= =20 Thursday when an Imperial County judge temporarily freed a small geothermal= =20 energy producer from its contract with Southern California Edison allowing= =20 it to sell power on the open market. ?????The ruling by Superior Court Judge Donal B. Donnelly could lead to a= =20 mass exodus by hundreds of small energy producers that have been selling=20 power to the state's financially troubled utilities for months without=20 getting paid. ?????At the same time it may have staved off plans by a group of the small= =20 generators to send Edison into involuntary bankruptcy as early as today. ?????In Sacramento energy legislation pushed by Gov. Gray Davis passed in= =20 the state Senate but foundered in the Assembly. The measure was intended to= =20 ensure that the state gets repaid for the electricity that it has been buyi= ng=20 on behalf of Edison and Pacific Gas & Electric which say they lack the cas= h=20 and credit to purchase power. The bill also was supposed to guarantee that= =20 the small alternative energy producers--which together provide nearly a=20 third of the state's power--get paid. But Assembly Republicans opposed it= =20 saying it hadn't been given sufficient scrutiny. ?????The impact of the small producers was made clear in Imperial County= =20 where Edison's failure to pay CalEnergy the county's biggest property=20 taxpayer had outsize implications. CalEnergy had put county officials on= =20 notice that it was about to miss a $3.8-million property tax payment. The= =20 uncertainty had prompted the tiny Calipatria Unified School District to=20 postpone a bond issue for badly needed school repairs. ?????Among CalEnergy Chairman David Sokol's first acts after the judge's=20 ruling Thursday was to promise Imperial County Supervisor Wally J. Leimgrub= er=20 that the company would pay its property taxes on time. ?????That is great news Leimgruber said. ?????Within hours of its court victory CalEnergy had stopped transmitting= =20 geothermal power to Edison and begun selling it to El Paso Energy a=20 marketing company that purchased the energy at prevailing rates and resold = it=20 on the spot market. ?????Some of the more than 700 other small energy producers in the state sa= id=20 they were considering similar action against Edison and Pacific Gas &=20 Electric. ?????We absolutely need the right to sell to third parties said Dean=20 Vanech president of Delta Power a New Jersey company that owns five small= =20 gas-fired plants in California and is owed tens of millions of dollars by= =20 Edison. ?????Sokol praised the Imperial County judge and said his company simply=20 wanted the authority to sell its power to a credit-worthy company that in= =20 fact pays for the power. ?????An Edison spokesman said the company was disappointed with the ruling= =20 but sympathized with CalEnergy and other small producers because=20 California's power crisis has placed [them] in financial distress just as= =20 it has placed utilities in financial distress. ?????Edison expressed concern that the ruling would prompt CalEnergy and=20 other small producers to sell their power out of state. Sokol said CalEnerg= y=20 had specifically told El Paso Energy that it hoped its power would remain i= n=20 California but if someone wants to pay a higher price out of state we=20 can't stop them. ?????Sokol said that Edison still owes CalEnergy $140 million and that the= =20 company--along with seven other small producers--had been prepared to file = a=20 petition in federal bankruptcy court in Los Angeles today forcing the utili= ty=20 into involuntary bankruptcy. He said his company no longer intends to do so= =20 and he believed--but wasn't certain--that the other companies would shelve= =20 their plans. ?????Edison filed papers Thursday with the federal Securities and Exchange= =20 Commission showing that it owed $840 million to various small electricity= =20 producers many of which rely on renewable energy sources such as geotherma= l=20 steam solar energy or wind. ?????The alternative energy producers--and utilities--strenuously objected = to=20 the legislation considered in Sacramento on Thursday. The bill spelling ou= t=20 how the utilities are to pay the state and the small producers passed the= =20 Senate on a 27-9 vote the exact two-thirds margin required. But it stalled= =20 in the Assembly on a 46-23 party-line vote well short of two-thirds. ?????When I was a citizen back in Lancaster I heard these stories about= =20 pieces of legislation that were cooked up late at night that . . . were cu= t=20 and pasted together and were rammed through by the Legislature Assemblyma= n=20 George Runner (R-Lancaster) said. That's exactly what we have before us. ?????The alternative electricity generators including oil companies warne= d=20 that they would lose money under the Davis proposal while representatives = of=20 Edison and PG&E which have amassed billions in debt in the worsening energ= y=20 crisis said the legislation would push them deeper into the hole. ?????There isn't enough money Edison attorney Ann Cohn testified at a=20 Senate hearing on the bill Thursday. It is a very simple question: Dollars= =20 going out cannot be greater than dollars coming in. ?????The bill AB 8X combined several proposals. First it sought to clari= fy=20 earlier legislation by spelling out that Edison and PG&E must pay the state= =20 all money collected from consumers for electricity that the state has been= =20 buying. ?????Additionally the bill would turn over to the California Public=20 Utilities Commission the thorny issue of how much to pay alternative energy= =20 producers for their electricity. ?????Wind solar and geothermal producers might agree to the prices offered= =20 by the administration. But most of the alternative energy producers=20 including Chevron and British Petroleum use natural gas to generate=20 electricity through cogeneration a process of creating steam for both=20 electric generation and heat. With natural gas prices high they contend= =20 they would lose money at the prices Davis is offering. ---=20 ?????Ellingwood reported from El Centro Morain from Sacramento. Times staf= f=20 writers Mitchell Landsberg in Los Angeles and Jenifer Warren Nancy Vogel a= nd=20 Carl Ingram in Sacramento contributed to this story. --- ------------------- Lodi Defies Order for Blackouts=20 Utility tells PG&E to 'pay the bills'=20 Alan Gathright Chronicle Staff Writer Friday March 23 2001=20 2001 San Francisco Chronicle=20 URL:=20 /23/M N171303.DTL=20 Let history show that the rebellion against rolling blackouts started when= =20 the Central Valley town of Lodi defied PG&E and refused to unplug its=20 customers this week.=20 Like several cities that own their own utilities Lodi saw the energy crunc= h=20 looming last fall and spent millions for long-term power contracts in an=20 attempt to avoid blackouts.=20 Now Lodi and a Northern California municipal utility cooperative that=20 includes Palo Alto Santa Clara and Alameda are telling Pacific Gas and=20 Electric Co. that it's unfair to force their customers to endure blackouts= =20 triggered by the near-bankrupt utility's failure to pay its debts.=20 The problem is not paying bills so pay the bills said Alan Vallow=20 director of the utility serving Lodi's 58000 residents. I won't arbitrari= ly=20 screw my customers . . . so 5000 PG&E customers can turn on their lights= =20 somewhere else.=20 When PG&E relayed an order from state power regulators Monday and Tuesday f= or=20 Lodi to black out some of its customers a strategy intended to keep the=20 West's power grid from collapsing Lodi said no.=20 So far other cities in the Northern California Power Agency say they will= =20 continue to participate in rotating outages.=20 But in a letter last Friday to PG&E members of the agency and four other= =20 utility districts including Sacramento's warned they didn't believe long-= =20 standing agreements that allow them to use PG&E transmission lines to conne= ct=20 to the grid obliged them to endure rolling blackouts because of PG&E's=20 failure to pay its power obligations.=20 They say the agreements require them to reduce power demand only in respons= e=20 to natural disasters or malfunctions damaging power lines or plants.=20 The agencies asked for a meeting with PG&E President Gordon Smith before=20 anticipated summer blackouts hit to develop a more rational program for= =20 allocation of risks associated with (power demand) load shedding before you= =20 call on us to participate in load shedding again.=20 REFUSING TO SHARE BURDEN PG&E officials accused Lodi of selfishly refusing to share the burden of th= e=20 statewide energy crisis.=20 It is regrettable that after reaping the benefits of the (power grid)=20 interconnection contract for many years Lodi is suddenly unwilling to bear= =20 their share of the burden of the statewide energy crisis said PG&E=20 spokesman Ron Low. When cities like Lodi do not follow the (state=20 Independent System Operator's) order to curtail power it hurts all of=20 California and jeopardizes the entire power grid.=20 Low also disagreed with accusations that this week's blackouts were trigger= ed=20 by PG&E's failure to pay its bills noting that the ISO stated that 12000= =20 megawatts of power were offline because of plant maintenance.=20 But ISO spokeswoman Lisa Szot confirmed assertions by the municipal utiliti= es=20 that power generators had kept an additional 3000 megawatts offline becaus= e=20 they feared PG&E couldn't pay.=20 Lodi's Vallow said he was legally obliged to serve city customers. Lodi=20 residents are facing rate increases of as much as 15 percent under a power= =20 contract that the city secured in hopes of avoiding blackouts. The contract= =20 required Lodi to pay a $10 million premium above its typical $23 million=20 annual energy bill.=20 'THAT'S NOT FAIR'=20 I've been hearing (PG&E say) 'Gee that's not fair. Where's the equity if= =20 everybody is doing rolling blackouts and you're not?' Vallow said. Well= I=20 put my customers at financial risk to the tune of $10 million. And if they'= re=20 not going to get to use that power they paid for then by God give us that= =20 money back.=20 Vallow said he was willing to sell PG&E some of Lodi's power surplus knowi= ng=20 Lodi might not be paid.=20 But I'm not willing to turn off 5000 customers so 5000 customers=20 somewhere else can turn their lights on Vallow said. The objective here= =20 people is to keep as many lights on as possible.=20 Other city-owned utilities while annoyed with the rolling blackouts aren'= t=20 going as far as Lodi.=20 WEATHERING BLACKOUTS I certainly understand the frustrations of utilities like Lodi and actuall= y=20 share those frustrations in many cases said John Roukema assistant=20 director of Santa Clara's utility.=20 But he stressed that his agency had been able to weather blackouts without= =20 hurting residents or small business because 17 major industrial power user= s=20 had agreed to curtail demand during energy alerts.=20 The prudent thing to do at this time is to continue to do our share and=20 participate in rolling blackouts because a single problem could cause a=20 catastrophic failure in the statewide system Roukema said.=20 In Alameda residents endured blackouts this week despite the fact that cit= y=20 has secured reliable power supplies said Matt McCabe spokesman for Alamed= a=20 Power & Telecom.=20 It was in the best of interests of Alamedans to maintain the stability and= =20 integrity of the grid he said. Now if it becomes evident that the syste= m=20 is being jeopardized for financial reasons then we should not have to=20 subject Alamedans to rolling blackouts.=20 In Palo Alto which also had blackouts this week utility officials told th= e=20 City Council they were expecting a 30 to 40 percent rate hike this spring t= o=20 pay new contracts guaranteeing a stable power supply said Councilman Bern= =20 Beecham. The city hopes to avoid giving customers the double whammy of rate= =20 boosts and more blackouts with a program that gets industrial users to cut= =20 demand voluntarily during alerts.=20 When there's not enough generating capacity in the state to protect the=20 integrity of the grid that is in fact everybody's problem Beecham said= =20 but that doesn't mean Palo Alto is willing to endure blackouts to prop up= =20 PG&E's ailing finances.=20 We need to have some very frank discussions with PG&E about mutual=20 obligations Beecham said.=20 Energy Tips=20 With Californians facing electricity and natural gas shortages PG&E has=20 several tips to help conserve both:=20 -- Set the furnace thermostat at 68 degrees or lower health permitting.=20 -- Wash only full loads in a dishwasher. If operating instructions allow= =20 turn dishwasher off before the drying cycle and let dishes dry naturally.= =20 -- Use low-wattage or fluorescent lights.=20 -- Fix defective plumbing and dripping faucets which waste water and=20 increase the gas or electric bill for heating the water.=20 -- Plug gaps around pipes ducts fans and vents that go through walls=20 ceilings and floors.=20 -- Keep furnaces clean and clean or replace the filter regularly.=20 -- Turn heaters down when using a fireplace and close the damper when not= =20 using the fireplace.=20 -- On sunny days open drapes on windows facing south and let the sun shine= =20 in. At night close the drapes to retain indoor heat.=20 Source: www.pge.com=20 E-mail Alan Gathright at 2001 San Francisco Chronicle ? Page?A - 1=20 --- Coming Down to the Wire=20 State legislators battle over alternative energy bills=20 Greg Lucas Robert Salladay Chronicle Sacramento Bureau Friday March 23 2001=20 2001 San Francisco Chronicle=20 URL:=20 /23/M N113351.DTL=20 Sacramento -- After several weeks of slow to no progress in attacking the= =20 state's energy mess the Legislature erupted yesterday into a frenzy of=20 energy activity.=20 The sudden action on a series of energy bills -- including one to let=20 businesses buy power directly from generators -- stemmed initially from the= =20 fear of bad publicity lawmakers might receive for a planned three-day junke= t=20 next week to Washington D.C.=20 When a key bill bogged down in the Assembly late yesterday Speaker Bob=20 Hertzberg D-Sherman Oaks announced the trip was canceled.=20 Another reason for the flurry of action was recognition that time is runnin= g=20 out.=20 Several alternative energy producers -- like wind farms and biomass plants = -=20 - said they were one day away from forcing the state's two biggest utilitie= s=20 into bankruptcy because they were owed more than $1 billion.=20 The Legislature's action and a court ruling that could free alternative=20 producers from unpaid contracts.=20 This is triage members of the Senate said Sen. Jim Costa D-Fresno. Th= is=20 is crisis activity we're engaged in.=20 The Senate approved a bill aimed at helping state regulators get cash to so= me=20 alternative energy producers. Most of them have been paid little or nothing= =20 since November by the utilities they sell electricity to.=20 Senators passed a bill to help the Public Utilities Commission order=20 utilities to pay solar wind and other alternative energy producers who sig= n=20 lower-priced contracts with the utilities.=20 The bill failed in the Assembly because of GOP opposition fanned in part b= y=20 price concerns by the oil industry a major co-generation producer. The=20 Assembly is set to meet again today to try again pass the bill which the P= UC=20 needs to issue its final order.=20 The PUC's proposed order offers the first hint of financial relief for=20 hundreds of alternative energy producers known as ''qualified facilities = in=20 the energy industry who have been paid just pennies on the dollar by cash-= =20 strapped Pacific Gas & Electric and Southern California Edison.=20 Lack of payments has caused many alternative generators to shutter their=20 operations.=20 The PUC's proposal which will be considered at the commission's meeting=20 Tuesday offers generators a choice of agreeing to a five-year contract at= =20 $79 per megawatt or a 10-year deal at $69 per megawatt Davis said. The goi= ng=20 rate now is about $150 a megawatt hour.=20 The order does not address money already owed to the more than 600=20 alternative energy producers.=20 Under the order utilities would have to pay any generator who signed the n= ew=20 contracts within two weeks.=20 But PG&E said it might not be able to afford do that.=20 Operators of co-generation facilities say the contracts contemplated by the= =20 PUC don't cover their cost of producing energy because the sale price no=20 longer would be pegged to the the price of natural gas.=20 In a significant court decision affecting generators one geothermal energy= =20 supplier in Imperial County won a lawsuit yesterday against Edison allowing= =20 the company to escape a contract requiring it to sell electricity to the=20 utility.=20 A superior court judge said CalEnergy operator of the geothermal plant=20 could suspend deliveries to Edison and sell the 268 megawatt hours it=20 generated on the open market.=20 CalEnergy is owed $75 million by the utility.=20 The court victory may ease mounting pressure from some qualified facilities= =20 including CalEnergy to drive one or both of the utilities into involuntary= =20 bankruptcy.=20 The Assembly and Senate meanwhile rushed through a series of bills aimed = at=20 increasing energy conservation and rushing the building of new power plant= s.=20 Most significant for bigger residential and commercial utility customers is= a=20 measure passed by the Assembly to allow energy customers to buy power=20 directly from generators.=20 That right was eliminated in January when the state began buying power for= =20 the cash-strapped utilities.=20 The bill approved unanimously yesterday would impose a yet to be determined= =20 exit fee on customers who leave the power grid to help cover the state's=20 financial exposure.=20 Tell Us What You Think=20 Can you save 20 percent on your energy use? Gov. Gray Davis' administration= =20 is offering rebates for Californians who save on power starting in June an= d=20 if you've got a strategy for conserving The Chronicle wants to hear it.=20 We'll be writing about the hardest-working energy savers in a future story.= =20 To get involved write to the Energy Desk San Francisco Chronicle 901=20 Mission St. San Francisco CA 94103 or e-mail energysaver@sfchronicle.com= .=20 E-mail the reporters at glucas@sfchronicle.com and bsalladay@sfchronicle.co= m.=20 2001 San Francisco Chronicle ? Page?A - 14=20 --- State's bill for energy could double this year=20 Posted at 9:34 p.m. PST Thursday March 22 2001=20 BY=20 STEVE=20 JOHNSON=20 AND=20 JOHN=20 Warning that California is imperiled by the prices it is paying for=20 electricity a report Thursday said the state's annual power tab could wind= =20 up being 10 times what it was two years ago.=20 At the current rate of spending the report estimated that the total=20 electricity bill in California this year could hit $70 billion which is mo= re=20 than twice what it was last year and about 10 times what was paid in 1999 a= nd=20 1998.=20 ``The California electricity market has gone from being `dysfunctional' to= =20 precipitating a crisis'' according to the report from the Independent Syst= em=20 Operator.=20 It added that the price being charged ``threatens any semblance of just and= =20 reasonable consumer rates the financial viability of California's=20 investor-owned utilities the financial stability of California of its=20 neighboring states and of the nation.''=20 While power suppliers denied any wrongdoing the report said the state=20 appears to have been hit with ``excess'' charges totaling $6.87 billion sin= ce=20 May based on an assessment of the typical operating costs of power plant= =20 owners. Out of that total $6.2 billion appeared to be excessive charges=20 during times when power was not in particularly short supply the agency=20 said.=20 The cost of power has become a growing concern now that the state has stepp= ed=20 in to buy it on behalf of Pacific Gas & Electric Co. and Southern Californi= a=20 Edison which claim to be so strapped for cash that they are on the verge o= f=20 bankruptcy.=20 In making public the report which was sent to the Federal Energy Regulator= y=20 Commission officials at the Independent System Operator were careful not t= o=20 accuse any power companies of price gouging. While the prices appeared to b= e=20 unreasonable they said the state needs to learn more about the specific= =20 operating costs of power plant operators before they could determine whethe= r=20 California was cheated.=20 The officials said they were considering asking the federal agency which= =20 oversees power wholesalers to order the suppliers to make refunds. In the= =20 past two weeks the federal agency has warned a number of suppliers that th= ey=20 may have to refund $135 million in apparent overcharges during January and= =20 February.=20 But many experts question whether the federal agency is serious about=20 demanding such refunds so California officials also are reviewing the=20 possibility of suing the suppliers or seeking criminal charges against some= =20 of them. ``We're working very closely with a number of agencies to review t= he=20 information we currently have to determine what remedies may be available'= '=20 said Charles Robinson the Independent System Operator's general counsel.= =20 The report's suspicions were partly bolstered by another study made public= =20 Thursday by the state auditor. It said California's market structure=20 encouraged bidding gamesmanship by both utilities and power sellers ``in an= =20 effort to manipulate wholesale prices to their advantage.'' But it stopped= =20 short of accusing power generators of profiting illegally.=20 ``There's clearly some evidence of market abuse'' said state Auditor Elain= e=20 Howle. Even so she added ``that's not to say it's anything illegal. We=20 hired consultants they looked at some of the bidding and they weren't=20 comfortable going that far.''=20 Although no power companies were named in either report officials with=20 several suppliers insisted they have done nothing wrong.=20 ``We've conducted our business legally and ethically'' said Richard=20 Wheatley spokesman for Reliant Energy which runs five major California=20 power plants. ``The ISO report appears to be nothing more than just another= =20 attempt to put blame at someone else's doorstep when there's been very=20 little action out of Sacramento to resolve the problems in the California= =20 marketplace.''=20 Duke Energy spokesman Jeremy Dreier said the company which runs plants in= =20 Moss Landing and Morro Bay sold most of its power last year and this year = in=20 relatively low-cost long-term contracts and was among the first to offer= =20 such deals to the state. He added that Duke increased production from its= =20 aging plants to meet surging demand.=20 ``The fact that we were among the first to bring long-term contracts to the= =20 table speaks volumes about how we're trying to serve this market'' Dreier= =20 said.=20 John Sousa of Dynegy Inc. which co-owns three major California plants add= ed=20 that ``given the market conditions the rates we charged were just and=20 reasonable.''=20 --- Plan for alternate power plants stalls=20 Posted at 10:03 p.m. PST Thursday March 22 2001=20 BY DION NISSENBAUM AND JENNIFER BJORHUS=20 Mercury News=20 SACRAMENTO -- The state's prospects for plugging a critical electricity gap= =20 dimmed Thursday when the state Assembly rejected a rescue plan for=20 alternative power companies and a state judge ruled that one such firm coul= d=20 stop selling energy in California.=20 Both actions threaten the plan Gov. Gray Davis announced just Tuesday to ke= ep=20 these companies running and stave off more blackouts. With the state's=20 troubled utilities failing to pay for their electricity many alternative= =20 energy plants have been shutting down.=20 The dual blows came on a day when tempers flared in the Capitol as lawmaker= s=20 jarred by back-to-back blackouts launched bipartisan attacks on Pacific Gas= &=20 Electric Co. and Southern California Edison which aren't paying wind sola= r=20 biomass geothermal and small gas-fired plants for their electricity.=20 After Republicans shot down the measure meant to keep alternative energy=20 companies in business Assembly Speaker Robert Hertzberg D-Van Nuys warne= d=20 that the restless companies might act on their threat to force the utilitie= s=20 into bankruptcy.=20 ``They said it and I understood them to mean it'' he said.=20 The failure overshadowed a burst of action in Sacramento where lawmakers=20 approved a host of other measures. The Senate approved two key bills: one= =20 that would spend more than $1 billion to encourage Californians to conserve= =20 energy and one that would make it easier to build power plants. The Assembl= y=20 approved 14 incremental bills.=20 Six votes short=20 But the Assembly fell six votes short of passing a hastily prepared bill=20 meant to help prop up the nearly 700 alternative energy companies many of= =20 which are now idle.=20 Those closings sapped California of energy this week and helped cause two= =20 days of rolling blackouts -- the first since January.=20 In response Davis and lawmakers cobbled together a plan to set new lower= =20 rates for alternative power and to fine the utilities if they refuse to pay= =20 these companies which supply up to a third of the state's power.=20 But Republicans refused to back the measure and said it contained too many= =20 complex parts that needed more time to analyze.=20 ``Everyone in this room knows that this piece of legislation has not had a= =20 good look'' said Assemblyman George Runner R-Lancaster.=20 Assemblyman Fred Keeley D-Santa Cruz castigated the Republicans and=20 implored them to accept an imperfect solution.=20 ``Ladies and gentlemen: Welcome to the NFL'' he said. ``Welcome to the wor= ld=20 where large complex issues don't have a simple solution.''=20 Approval is needed before state regulators at the Public Utilities Commissi= on=20 can vote on the fine points of the plan. That was supposed to happen Tuesda= y.=20 Much of the criticism focused on concerns raised by power plants that use= =20 natural gas to produce energy. Administrators from those plants said the=20 Davis price caps would make it impossible for them to break even.=20 The derailment came hours after the measure narrowly won approval in the=20 state Senate.=20 Hertzberg plans to search for a compromise today and canceled plans for the= =20 Assembly's annual trip to Washington.=20 Thursday's actions were highlighted by angry attacks on the utilities by=20 frustrated lawmakers.=20 ``I hope they do go bankrupt'' shouted Senate President pro tem John Burto= n=20 D-San Francisco during a debate on the energy crisis. ``Let them go belly= =20 up. I don't care any more.''=20 Legal decision adds twist=20 The legislative failure was compounded by a legal decision in Southern=20 California that further complicated the picture.=20 A Superior Court judge in Imperial County cleared the way for CalEnergy=20 Operating Corp. to break its contract with Edison and sell its 268 megawatt= s=20 of power on the open market. The judge concluded that Edison had breached i= ts=20 contract by failing to pay CalEnergy since November.=20 That ruling could pave the way for hundreds of others to follow suit and=20 drain off power California needs to prevent blackouts.=20 ``It's not good'' said V. John White director of the Center for Energy=20 Efficiency and Renewable Technologies. ``This is potentially going to chang= e=20 the dynamics of the situation and probably not for the better.''=20 Jan Smutny-Jones executive director of the Independent Energy Producers=20 Association said it was unclear whether other companies would sue.=20 ``I think this is a very significant development'' he said. ``We're sort o= f=20 at a period where the industry's reaching the end of the rope.''=20 The ruling did have one silver lining: CalEnergy Chairman David Sokol said= =20 his company and seven others had planned to force Edison into bankruptcy if= =20 they lost in court.=20 But he also warned ``You stick a sharp stick in enough people's eyes and= =20 they get pretty tired of it.''=20 The situation with generators supplying PG&E isn't as dire since the compan= y=20 has been making partial payments.=20 Kent Burton senior vice president for Covanta Energy Corp. in New Jersey= =20 said ``They've tried to be responsive.''=20 Mercury News Staff Writer Mark Gladstone contributed to this report. Contac= t=20 Dion Nissenbaum at dnissenbaum@sjmercury.com or (916) 441-4603 or Jennifer= =20 Bjorhus at jbjorhus@sjmercury.com or (408) 920-5660. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Dereg Articles Body:: yes Mark Palmer@ENRON 09/26/2000 08:51 AM To: Steven J Kean@EES James D Steffes/NA/Enron@Enron cc: Subject: Dereg Articles Should we ask the guy that did the deal with Champion Paper to write a response? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Contribution to Sacramento Womens Campaign Fund Body:: Let's process this request. I think it's justified. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Return of Confidential Materials Body:: Jeff. I have no docs on this transaction. Thus have nothing to destroy. Michelle What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Joe - there is no announcement today. I tried to leave you a voicemail but apparently the system is down there. Before we can offer an outside person a VP position the Executive Committee must sign off. We are going to be going through that process in a few minutes. Then we begin the offer extension and negotiations. The person we are recommending is Linda Robertson one of the two people I mentioned to you before. Please guard the information carefully. Last time we talked when the list had been narrowed to two DeLay's office called with the exact two names and started pushing us to hire a Republican. As you know we interviewed candidates of both political affiliations and just settled on the best person. Ken told DeLay's office that's how we do things and Ken is comfortable (actually enthused) about the choice. When some external announcement is done you will be involved and your considerable contributions will be prominently mentioned. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential - Decision tree on projects Body:: We will discuss at the next Staff meeting. Thanks for bringing it up. Any= feedback from the floor meeting yesterday would be appreciated. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: NEW DRAFT OF ENRON STATEMENT Body:: I know we are holding for a later filing but I have attached further comments anyway. The document is still too rough to send out. We need to take the opportunity as soon as possible to get a hard hitting thoroughly researched and carefully written document in front of the Commissioners. California's reaction to the Judge's recommendation is likely to give FERC (especially the new commissioners) a feel for how irrational the California politicians can be. We will have a limited opportunity to take advantage of that realization. We need to hit it hard in the pleading our conversations at the Commission the Hill and the media. Linda Robertson 07/09/2001 09:58 AM To: James D Steffes/NA/Enron@Enron cc: Alan Comnes/Enron@EnronXGate Carole Hodge/ETOL/EU/Enron@ETOL dwatkiss@bracepatt.com Jeff Dasovich/NA/Enron@ENRON Richard B Sanders/Enron@EnronXGate Richard Shapiro/NA/Enron@ENRON Robert Frank/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Steven J Kean/NA/Enron@ENRON Susan J Mara/NA/Enron@ENRON Subject: Re: NEW DRAFT OF ENRON STATEMENT Let me emphasize that these comments are to be filed COB TODAY. James D Steffes 07/09/2001 10:50 AM To: Robert Frank/NA/Enron@Enron Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Carole Hodge/ETOL/EU/Enron@ETOL Richard B Sanders/Enron@EnronXGate dwatkiss@bracepatt.com Alan Comnes/Enron@EnronXGate Susan J Mara/NA/Enron Jeff Dasovich/NA/Enron@Enron cc: Subject: NEW DRAFT OF ENRON STATEMENT HERE IS THE MOST RECENT STATEMENT WITH STEVE'S COMMENTS. Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: On Sunday: Natural Gas in the 21st Century: The Shape of Things to Come Body:: Ken Lay speaking and James J. Hoecker What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Wed 6/6: Businesses vie for blackout exemptions:=20 The PUC must decide who should be spared and the applicant list is very lo= ng Sac Bee Wed 6/6: PG&E ISO agree to court order on power bills Sac Bee Wed 6/6: Peter Schrag: Turning up the heat in Houston and=20 Washington (Editorial) SD Union Wed 6/6: Is trading an insider's game? SD Union Wed 6/6: Daily energy costs for state fall in past weeks=20 SD Union Wed 6/6: Five tiers sought in proposed rate boost SD Union Wed 6/6: Port budget large but power bills loom SD Union Wed 6/6: Continuous use urged for planned power plant=20 SD Union Wed 6/6: Rising energy prices threaten Poway troupe=20 SD Union Wed 6/6: Fair to use generators for midway attractions LA Times Wed 6/6: 'Hi My Name Isn't Justice Honey' and Shame on Lockye= r =20 (Editorial) LA Times Wed 6/6: U.S. Probes Alleged Pact Not to Build New Plants Power:= =20 Justice officials focus on Southland operations of two firms which deny=20 wrongdoing LA Times Wed 6/6: Natural Gas Power Prices Drop Sharply Energy:=20 More conservation mild weather are among factors keeping costs down exper= ts=20 say LA Times Wed 6/6: The State Utility Averts $1 Billion in Costs Courts:=20 PG&E and Cal-ISO agree to recognize Department of Water Resources as=20 purchaser of the power SF Chron Wed 6/6: Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited SF Chron Wed 6/6: San Jose council gives green light to generating plant= =20 VOTE REVERSAL: Officials pressured to OK project SF Chron Wed 6/6: Developments in California's energy crisis SF Chron Wed 6/6: California conserves SF Chron Wed 6/6: L.A. power customers awash in cheap energy SF Chron Wed 6/6: PG&E doesn't want to pay for energy to avert blackouts Mercury News Wed 6/6: Metcalf plant gets preliminary approval=20 OC Register Wed 6/6: Feds probe AES Williams Individual.com (PRnewswire) Wed 6/6: Calpine Begins Construction of=20 Peaking Energy Center in Gilroy Calif.=20 Individual.com (PRnewsire) Wed 6/6: Reliant Urges FERC to Drop or Amend= =20 California Price Caps to Avoid Additional Shortages and More Blackouts Energy Insight Wed 6/6: Farm-fresh biopower --- Businesses vie for blackout exemptions: The PUC must decide who should be= =20 spared and the applicant list is very long. By Carrie Peyton and Dale Kasler Bee Staff Writers (Published June 6 2001)=20 Mixes for milkshakes and frozen coffees could spoil at ice cream parlors= =20 sickening customers.=20 Seniors getting their hair done would have to leave their dryers and go hom= e=20 with wet heads risking a chill.=20 Mall escalators could come to a sudden halt endangering shoppers who lose= =20 their footing.=20 Those are among the health and safety risks cited by more than 10000=20 businesses and government bodies asking state regulators to exempt them fro= m=20 rolling blackouts.=20 It is a list that mixes nursing homes and grocery stores outpatient surgic= al=20 clinics and beauty salons dialysis centers and country clubs.=20 A lot of people are treating this like a lottery said Subodh Medhekar of= =20 Exponent Inc. the consulting firm sorting through exemption requests for t= he=20 state Public Utilities Commission.=20 For many Medhekar said the rationale seems to be 'I'm pretty sure I won= 't=20 get exempted but what's the down side? Let's put in an application.' =20 Amid predictions that Californians could face dozens of rolling blackouts= =20 this summer state regulators are trying to update a decades-old list of wh= o=20 should be spared if the lights go out.=20 The Alta Sierra County Club in Grass Valley should be among those whose pow= er=20 stays on Sean O'Brien the club's golf course superintendent told=20 regulators in a nine-page application.=20 The country club telephones could go out making it harder to phone for hel= p=20 if someone has a medical problem while golfing he said in an interview.=20 And if the golf course's irrigation pumps shut down it would lose the=20 ability to quell small blazes -- leaving it to rely on a fire station O'Bri= en=20 said is about one-quarter mile away.=20 Placerville Dialysis wants an exemption too. As many as a dozen people the= re=20 can be having their blood pumped through an artificial kidney that cleans i= t=20 when their own kidneys no longer function properly.=20 When the power goes out everything just stops said manager Shirley=20 Carpenter. There is a way to manually return the blood by hand before it= =20 clots in the line. ... It would just be hectic.=20 It takes about five minutes of manual pumping to fully disconnect someone= =20 from a dialysis machine Carpenter said. And some patients can help by=20 operating their own pumps.=20 But she said I'm sure it would be kind of frightening to have your blood= =20 out in the line and the power off and they're pretty much tied to the=20 machine.=20 Pam Chin a hairdresser at the Loomis Beauty Salon said the owner sought a= n=20 exemption because people could get overheated if the air conditioning went= =20 out and older customers getting their hair set could be chilled if the=20 dryers shut off.=20 With about half the state already exempt from rolling blackouts the questi= on=20 of who else should stay connected has become a delicate one for utilities= =20 regulators and legislators.=20 Carl Wood the PUC commissioner who has taken the lead on blackout issues= =20 estimates that fewer than 1000 more utility customers can be exempted befo= re=20 they overload the rolling outage system designed to take stress off the=20 electric grid.=20 While about 6000 customers are classified as essential by the state's tw= o=20 largest utilities keeping them out of the blackout rotation also spares=20 about 5 million other customers who are served by the same circuits.=20 That multiplier effect will have to be weighed by the consulting firm by= =20 utilities and eventually by PUC commissioners who are scheduled to vote in= =20 early August on who should be added to existing standards.=20 The rules will apply to the state's investor-owned utilities Pacific Gas a= nd=20 Electric Co. Southern California Edison and San Diego Gas & Electric Co.= =20 but not to municipal utilities.=20 The Sacramento Municipal Utility District already rejected pleas for specia= l=20 exemptions from a medical lab a veterinary hospital nursing homes medica= l=20 facilities businesses and residents. SMUD believes they can weather=20 blackouts because they are not critical to public safety.=20 People have counted on having dependable electricity for so long that some= =20 have widely varying ideas of who can do without it safely Medhekar said.= =20 Of the more than 500 Baskin Robbins ice cream parlors that dot California= =20 only five are listed on the PUC Web site as applicants for exemptions.=20 The site cautions that its list of 9239 electronic applicants hasn't been= =20 checked for duplicates -- or fiction. It includes hundreds of outlets of th= e=20 same drug store and supermarket chains dozens of related nursing homes and= =20 more than 400 dentists. Another 1200 commercial power users have applied b= y=20 fax.=20 Among those who have confirmed they want out of outages are the grocery=20 chains operated by West Sacramento-based Raley's which said it took the=20 action as part of united effort with all California grocers who are worrie= d=20 about food spoilage.=20 Others in the mix are Fairfield's Westfield Shoppingtown Solano formerly t= he=20 Solano Mall where officials sought the exemptions out of fear that shopper= s=20 would get injured if escalators came to a sudden halt.=20 The Yolo County Housing Authority asked for an exemption on behalf of its 7= 00=20 dwellings in the belief that the utilities offer exemptions for low-income= =20 Californians Executive Director David Serena said.=20 Serena added that many of the authority's occupants are older or disabled a= nd=20 could be endangered by a blackout.=20 Chevron Corp. acknowledged it couldn't show that a blackout at its refineri= es=20 would present imminent danger to public health or safety but it asked Go= v.=20 Gray Davis to support legislation exempting makers and transporters for=20 critical fuels saying a refinery shutdown would cut into the state's=20 gasoline supply.=20 Some businesses acknowledged that their applications are a long shot.=20 It's probably a stretch said Amanda Leveroni who owns Bacio Catering Co= .=20 of Chico about her request to the PUC. The public wouldn't be in danger.= =20 But we're a catering company -- somebody has planned for a year-plus for a= =20 wedding or some big event she added. I would be in such a huge situation= .=20 I'd have to send out for pizza.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com. PG&E ISO agree to court order on power bills By Claire Cooper Bee Staff Writers (Published June 6 2001)=20 SAN FRANCISCO -- Pacific Gas and Electric Co. and the operator of=20 California's power grid agreed Tuesday to a preliminary court order providi= ng=20 that the utility will continue to receive -- but not pay -- generators' bil= ls=20 for the state's purchases of the most expensive wholesale electricity.=20 The tab has been running at about $300 million a month.=20 The order which U.S. Bankruptcy Judge Dennis Montali said he'll sign will= =20 specify that the Independent System Operator will not procure power except= =20 for a creditworthy buyer who has agreed to pay the generator.=20 In California the only such potential buyer is the state Department of Wat= er=20 Resources. However the department which has avoided PG&E Co.'s bankruptcy= =20 proceedings by claiming sovereign immunity will not be controlled by the= =20 agreement. Montali pointed out that the department still could demand=20 reimbursement from PG&E.=20 Under the agreement the ISO will not press any claims against PG&E on beha= lf=20 of generators if they are not paid.=20 The proposed preliminary injunction was based on an April order by the=20 Federal Energy Regulatory Commission which forbade the ISO from purchasing= =20 power on behalf of any non-creditworthy buyer such as PG&E.=20 The ISO is appealing the FERC order. If the appeal succeeds the injunction= =20 will end.=20 Peter Schrag: Turning up the heat in Houston and Washington (Published June 6 2001)=20 Behind all the palaver about the predictable standoff at last week's energy= =20 summit between President Bush and Gov. Gray Davis one major political=20 development was missed.=20 Put simply in the past month the focus of the California energy crisis an= d=20 maybe the onus as well has moved east: from the state's (and Davis')=20 handling of the mess to the generating companies energy marketers and gas= =20 pipeline companies that have richly profited from it and thus to FERC the= =20 do-next-to-nothing Federal Energy Regulatory Commission and the Bush=20 administration.=20 That wasn't all Davis' doing -- far from it -- though it's been at the hear= t=20 of his message about energy industry pirates and profiteers. Bush's=20 misbegotten energy plan and the administration's political clumsiness also= =20 contributed mightily not least by inadvertently giving Davis the chance to= =20 get media exposure he could only have dreamed about.=20 More important there's the defection of Sen. James Jeffords from the=20 Republican Party and the resulting shift of control in the U.S. Senate whe= re=20 the next chair of the Energy Committee will be Sen. Jeff Bingaman of New=20 Mexico a co-sponsor of Sen. Dianne Feinstein's bill capping wholesale=20 electric rates for the next two years. And chairing the Committee on=20 Governmental Affairs will be Sen. Joseph Lieberman of Connecticut who's=20 already asked for an audit of energy prices.=20 Those changes will draw a lot more attention to recent studies showing that= a=20 handful of big generators -- Duke Power Reliant Mirant Dynegy and the hu= ge=20 energy-marketing firm Enron -- have gamed the market to drive wholesale=20 prices to levels that in the year 2000 sometimes reached 40 times the=20 prices of the year before.=20 The findings come not merely from economists at the California Independent= =20 System Operator the agency that manages the state's grid who estimate=20 overcharges resulting from market power at $6.2 billion for last year alone= .=20 They come also from Severin Borenstein and his colleagues at the University= =20 of California Energy Institute who conservatively calculate the=20 overcharges at $4.5 billion from Paul Joskow a widely respected energy=20 economist at MIT and from Edward Kahn an economic analyst in San Francisc= o.=20 In a recent paper published by the National Bureau of Economic Research=20 Joskow and Kahn conclude that there's considerable evidence that the high= =20 prices experienced in the summer of 2000 reflect the withholding of supplie= s=20 from the market by suppliers [generators or marketers] exercising market=20 power. That those high prices occurred not merely during peak usage but al= so=20 at off-hours when no one had ever seen a price spike before makes those= =20 spikes even more curious.=20 There is in addition the powerful suspicion that the huge increase in=20 natural gas prices that a subsidiary of El Paso Energy Co. now the largest= =20 gas company on Earth was charging on the California side of the=20 California-Arizona border wasn't merely the result of an innocent imbalance= =20 between supply and demand.=20 None of that may be illegal. If there's no collusion there are no violatio= ns=20 of antitrust laws. But it adds plenty of steam to the political argument. I= n=20 the 2000 election cycle alone energy companies kicked in some $64 million = in=20 political contributions 75 percent of it to Republicans. At a time when=20 those companies many of them located in the same Houston neighborhood are= =20 racking up astronomical profits and when their collective coziness with Bus= h=20 and the Republican Party is a lot more than rhetoric their vulnerability t= o=20 a vigorous Senate investigation ought to be obvious.=20 The clincher is Blackout a Frontline program that both symbolizes the= =20 shifting emphasis and reinforces it. (The program is scheduled to be aired = at=20 8 p.m. Friday on Sacramento cable Channel 7.) It isn't another recital of= =20 Californians worrying about their electric bills or about the stupidity of= =20 the state's deregulation scheme or how Davis dithered in addressing the=20 crisis. It is about those generators and marketers in Houston and North=20 Carolina men (and a few women) who regard themselves as the heroes of the= =20 new energy markets.=20 The piece is reported by Lowell Bergman who in working for both Frontline= =20 and the New York Times has already broken major print stories about Duke=20 Power's secret approach to Davis offering unspecified energy refunds in=20 return for an end to state investigations and lawsuits. Bergman also report= ed=20 private conversations between Enron chairman Kenneth Lay a major Bush=20 supporter and FERC chairman Curt Hebert regarding the influence that Lay= =20 could exercise with Bush to allow Hebert to keep his chairmanship if Hebert= 's=20 supported certain decisions Enron badly wants.=20 None of these recent events is likely to end Davis' political woes and the= y=20 may not produce the wholesale rate caps Feinstein wants and that most=20 economists think necessary -- or maybe any significant reduction in the=20 industry's predatory pricing. But they will surely help turn up the heat= =20 both in Houston and Washington. Six months ago FERC found wholesale prices= =20 were not fair and reasonable as federal law requires but did little abou= t=20 them. It will now have a lot more questions to answer.=20 Peter Schrag can be reached at Box 15779 Sacramento CA 95852-0779 or at= =20 pschrag@sacbee.com. Is trading an insider's game?=20 Buying selling of electricity is a growth business but some say deck is= =20 stacked against consumers By Craig D. Rose=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 While Californians decry deregulation's failure to deliver a competitive=20 market electricity wholesalers have quietly developed a vast and rapidly= =20 growing business of buying and selling power among themselves.=20 The deals take place on high-tech trading floors in Houston and elsewhere= =20 around the country as well as on Internet-based trading systems.=20 Some experts say this electricity trading is a key mechanism for raising=20 consumer power prices yet it's largely unregulated.=20 Electricity trading is like buying stock -- when you have ability to chang= e=20 the stock price said Frank Wolak a Stanford University economics profess= or=20 and member of the state grid operator's market surveillance group.=20 Energy companies say the buying and selling of contracts to deliver power= =20 provides risk management allowing plant owners to presell their electricit= y=20 lock in prices and avoid fluctuations. The rough and tumble of the free=20 market they add is the most efficient means of allocating a resource like= =20 electricity.=20 But industry critics say trading is far from a competitive market paradigm.= =20 In their view it's a means of communication -- a way for energy insiders t= o=20 collude and raise prices under the guise of competition.=20 To be sure the trading arms of major energy companies have emerged as star= s=20 in an industry where profit surges of 300 percent or 400 percent are not=20 uncommon.=20 The transactions shrouded in secrecy can leave ownership of a critical=20 commodity in unknown hands. Consider the case of power generated by AES=20 Corp.'s California plants.=20 In 1998 AES made a bold move. Immediately after purchasing power plants th= at=20 gave it control of 10 percent of the state's electric generating capacity= =20 the company sold the output from its plants for the next 20 years to Willia= ms=20 Cos.=20 Williams did not sit on this treasure trove of electrons. The Tulsa Okla.= =20 company soon sold 80 percent of what it bought.=20 It is difficult to say who owns that power now. Some might be owned by Semp= ra=20 Trading a sister company of SDG&E. Or some could be owned by Enron Corp.= =20 the nation's biggest electricity trader.=20 A spokeswoman for Williams conceded that Williams itself may have repurchas= ed=20 some of the electricity it sold earlier. But trading companies closely guar= d=20 their positions.=20 This much can be said with certainty: Electricity that AES sold for less th= an=20 5 cents per kilowatt-hour to Williams changed hands perhaps 10 times in the= =20 wholesale market and emerged at times in recent months with a price tag for= =20 consumers that was 300 percent higher.=20 Williams' trading profits increased by 523 percent in the first quarter thi= s=20 year. Advance sales All this buying and selling creates curious confluences.=20 In their attempt to deflect criticism over high prices generating companie= s=20 such as Duke Energy -- operator of the South Bay Power Plant in Chula and= =20 others in the state -- frequently note that they sell most of their=20 electricity far in advance. But they acknowledge less often that their=20 trading units may also be buying power which could boost the company's=20 electricity inventory.=20 Duke was the fourth biggest electricity trader last year and cited its=20 trading activity as a prime contributor to its wholesale business profits= =20 which soared 324 percent in the first quarter to $348 million.=20 It is a company's power traders who frequently direct plant operators to=20 increase or decrease the generation of power in response to market=20 conditions.=20 Energy companies have little option but to turn to trading for profits. One= =20 of the better kept secrets of electrical deregulation and its promise of=20 competition is that there is remarkably little competition in the productio= n=20 side of the business.=20 For one thing electricity is a commodity power from one company is=20 indistinguishable from that generated by others.=20 More important nearly all modern plants generate power from turbines built= =20 by a handful of manufacturers. The result? Modern plants owned by different= =20 companies produce power at nearly identical cost.=20 The cost of power produced by modern plants is all within a mil=20 (one-thousandth of a dollar) said Michael Peevey an adviser to Gov. Gray= =20 Davis and former president of Southern California Edison.=20 So the extraction of profit in the electricity business relies much more on= =20 trading. Traders' profits rise when prices are volatile -- plunging or eve= n=20 better rising sharply. Little regulation But despite the obvious temptation to manipulate the market the burgeoning= =20 electricity trading business has remained largely unregulated.=20 The Federal Energy Regulatory Commission does require quarterly filings fro= m=20 energy traders but these often provide incomplete information or at least= =20 little that has been of concern to FERC.=20 In fact although the trading of electricity grew more than a hundredfold= =20 from 1996 to 2000 FERC has taken no major enforcement action against a=20 trader. After the onset of the California crisis last year FERC has acted= =20 once. That was against Williams which agreed to pay $8 million without=20 admitting guilt to resolve an allegation that it withheld supply to pump up= =20 prices.=20 FERC's record of enforcement in the area of power trading stands in contras= t=20 to a long list of enforcement actions within other markets taken by the=20 Securities Exchange Commission and the Commodity Futures Trading Commission= .=20 FERC has recently added staff to its market oversight operations. But Willi= am=20 Massey a FERC commissioner says the agency's effort is still inadequate.= =20 Electricity can be flipped stripped and chopped up Massey said. It's a= n=20 extraordinarily complicated market.=20 The sophisticated marketers and traders have simply moved past us. We're= =20 kind of horse and buggy in our approach and they're out there in rocket shi= ps=20 flying around ... The problem is that sophisticated traders don't necessari= ly=20 produce reasonable prices. They produce profits.=20 Before deregulation electricity trading was a low-key affair. Regulated=20 utilities dealt power back and forth on a reciprocal basis to fill=20 electricity shortfalls in their control areas. There was little trading for= =20 profit until the mid-1990s after federal legislation and FERC rulings open= ed=20 the market.=20 Major traders include large energy companies sister companies of=20 California's major utilities and Wall Street firms. Market volatility In many ways the trading of power is similar to that of other commodities.= =20 But there are important differences. Because it cannot be stored and its us= e=20 is so fundamental the price of electricity is the most volatile of all.=20 When supplies are tight a single supplier can rapidly raise prices to=20 budget-busting levels as evidenced by Duke Energy's recent admission that = it=20 charged California nearly $4000 for a megawatt-hour of power a quantity= =20 that probably sold hours earlier for one-tenth of that sum or less.=20 Wolak the Stanford economist and state Sen. Joseph Dunn D-Garden Grove= =20 who is investigating the state power market say trading allows companies t= o=20 collude under the guise of competition. Instead of wringing out lowest cost= s=20 the wholesale trading market serves to raise prices they say.=20 As I trade to you and you trade to me we communicate to each other what= =20 price we would like to get said Wolak. It's not collusive. It's just=20 communicating price.=20 Mark Palmer a spokesman for Enron the nation's biggest power trader said= =20 California's problem is not the result of trading.=20 It's a result of shortages Palmer said.=20 Underscoring its emphasis on trading Enron's new headquarters tower in=20 downtown Houston rises from a six-story block of new trading floors=20 including expanded space for electricity trading.=20 Enron also pioneered trading in cyberspace and its Enron Online site claims= =20 to be the most active computer-based trading market.=20 The Houston company argues that consumers won't fully benefit from power=20 trading and deregulation until they have greater choice in choosing their= =20 power supplier. And the company says FERC has not done enough to open acces= s=20 to transmission lines which would allow traders to move power around the= =20 country. To that end Enron has lobbied hard for President Bush's plan for = a=20 national electricity grid.=20 Palmer says the notion that the price of electricity rises each time it is= =20 traded is mistaken.=20 The market is always looking for the real price of a commodity Palmer=20 said.=20 Dunn the California state senator says his investigation found a differen= t=20 function for trading. At a time when supply barely meets or falls short of= =20 demand he noted companies with electricity to sell have to worry only abo= ut=20 how high to set their price.=20 The trader is a pawn in the generator's game to drive up prices said Dun= n.=20 Trading develops a level of trust. You my alleged competitor will bid in= =20 the same patterns and I will respond not in a competitive pattern but in a= =20 complimentary pattern.=20 The state senator said his investigation found evidence that on several day= s=20 energy companies appeared to test their ability to drive prices up without= =20 being undercut by competitors.=20 This ability to drive up prices without competitive consequence is a key te= st=20 of market power the technical term for manipulation or price fixing.=20 But Dunn also conceded that antitrust violations can be hard to prove in=20 court. He suggested that even if the trading behavior falls short of=20 antitrust violations it remains anti-competitive and devastating for the= =20 California economy.=20 To Harry Trebing a utility industry expert and professor emeritus at=20 Michigan State University wholesale electricity trading is reminiscent of= =20 what took place in the 1920s and early '30s. Back then utility companies= =20 created complex networks of holding companies that traded stock among=20 themselves driving up prices in the process.=20 Undoing that scheme was a focus of President Franklin Roosevelt's=20 administration. Congress ended up barring national power companies and=20 tightening regulation of utilities in an effort to counteract their tenden= cy=20 to create markets that work only for insiders.=20 The broad goals of trading are the same Trebing said.=20 The goal is to maximize profits through raising prices.=20 Daily energy costs for state fall in past weeks=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 SACRAMENTO -- In some of the first good news of the electricity crisis the= =20 Davis administration said yesterday that the daily cost of power purchased = by=20 the state for utility customers has dropped in recent weeks.=20 The price-drop news comes after an announcement that Californians conserved= =20 more energy than expected last month 11 percent and amid Davis=20 administration optimism that the Legislature may finally begin to move on a= =20 plan to keep Southern California Edison out of bankruptcy.=20 The developments if they turn out to be a trend and not temporary could b= e=20 among the first signs that Gov. Gray Davis' plan to end the electricity=20 crisis is beginning to work. But the administration isn't saying that.=20 We have had a few good days here lately said S. David Freeman a Davis= =20 power adviser. I don't think that I want to project.=20 Some power-market watchers began to speculate last month that prices may ha= ve=20 peaked earlier this year. Platts an energy information service said=20 yesterday that spot prices for the natural gas used by power plants are=20 falling this month.=20 The governor's press secretary Steve Maviglio told reporters yesterday th= at=20 the daily amount spent on power is now well below $50 million which was= =20 the average cost earlier this year.=20 A 12-day gap in the most recent notice to the Legislature that another $500= =20 million increment will be spent on power suggests that the daily average=20 during the last two weeks may have dropped down around $42 million.=20 Oscar Hidalgo a spokesman for the state power purchasing agency said that= =20 the average cost of power was under $40 million during the first four days = of=20 this month.=20 Maviglio attributed the lower cost to conservation the phasing in of cheap= er=20 long-term power contracts fewer power plants off-line for maintenance and= =20 cooler weather.=20 However he said The average cost is still way over what we paid last=20 year.=20 There was widespread skepticism in late April when the governor's consultan= ts=20 predicted that the $346 per megawatt-hour average paid by the state for=20 non-contracted power from April through June would drop to an average of $1= 95=20 from July through September.=20 We are still very comfortable with the projection that Mr. Fichera and=20 company estimated Maviglio said referring to Joseph Fichera of Saber=20 Partners in New York.=20 During a briefing on May 21 Fichera told reporters that the amount of powe= r=20 that the state would obtain under long-term contracts for May was expected = to=20 be about 43 percent of the total required the so-called net short.=20 Fichera said contracts already signed were expected to cover 66 percent of= =20 the net short in June 48 percent in July and 42 percent in August. He sai= d=20 contracts that had been agreed on in principle could increase those amounts= =20 to 73 percent in June 67 percent in July and 60 percent in August.=20 We are still on target. There are risks Fichera said yesterday among th= em=20 extended hot weather and power plant outages. No one is popping the=20 champagne corks until Sept. 30.=20 The governor's consultants based their forecast of power demand this summer= =20 on an estimate that Californians will reduce their electricity use by 7=20 percent.=20 The 11 percent reduction last month as compared to May of last year came= =20 before the sticker shock of rate hikes that begin this month for customers = of=20 Edison and Pacific Gas and Electric. And a $35 million ad campaign urging= =20 conservation has not hit full stride.=20 Maviglio said the administration plans to release some detailed information= =20 on Monday about the roughly $8 billion the state has spent buying power. Th= e=20 general fund will be repaid by a bond of up to $13.4 billion that ratepayer= s=20 will pay off over 15 years.=20 Legislative leaders have demanded detailed information about power purchase= s=20 before proceeding with the Edison plan. Assembly Democrats are working on a= =20 plan that de-emphasizes state purchase of the Edison transmission system an= d=20 would put most of the burden for paying off Edison's debt on businesses and= =20 large users not residences. Five tiers sought in proposed rate boost=20 Conservation would be promoted SDG&E says By Karen Kucher=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 A proposed rate increase for SDG&E customers to cover the high cost of=20 electricity should be imposed in five tiers to encourage conservation the= =20 company is advising state utility regulators.=20 The more electricity a customer uses the higher the rate would be.=20 SDG&E needs to raise its rates to bring in an additional $502 million=20 annually to pay the state for power purchases.=20 The state Public Utilities Commission is expected to rule on San Diego Gas = &=20 Electric's rate-increase proposal June 28.=20 The rate changes would remove a cap that has shielded most SDG&E customers= =20 from rising electricity prices for a year. The cap enacted by state=20 lawmakers in September 2000 and retroactive to June 2000 set rates at 6.5= =20 cents per kilowatt-hour.=20 Higher rates would mean the average SDG&E residential and small-business=20 customer's electricity bills would go up by 18 percent. Large commercial=20 users' bills would average 29 percent more.=20 Public hearings on the issue will be held next Monday and Tuesday in San=20 Diego El Cajon Escondido and San Clemente. These sessions will focus on= =20 small-business and residential consumers. Hearings on large commercial user= s=20 were held last month.=20 Earlier this year the PUC decided to allow the state's two largest=20 utilities Pacific Gas and Electric and Southern California Edison to char= ge=20 customers an extra $5.7 billion annually for electricity.=20 The state Department of Water Resources which has been buying power for=20 SDG&E customers since February asked SDG&E to generate a total of $915=20 million annually to cover the cost of electricity purchases.=20 With the proposed rate increases SDG&E could do that.=20 Large commercial customers would pay about 30 percent of the overall increa= se=20 and residential and small-business customers would pay about 70 percent sa= id=20 Ed Van Herik a spokesman for the utility company.=20 If the increase can be tiered as many as 60 percent of residential custome= rs=20 will see no rate increase if their electricity usage remains the same Van= =20 Herik said.=20 But customers who use more than 130 percent of their baseline -- considered= =20 the minimum amount of electricity needed by a household -- will be billed a= t=20 increasingly higher rates.=20 Residential and small-business customers who use a lot of electricity could= =20 pay as much as 17.89 cents per kilowatt hour for some power they consume.= =20 Consumer advocate Michael Shames said he is concerned the utility's proposa= l=20 does not spread the increases evenly among different types of users. He als= o=20 called for more scrutiny of the state's request.=20 People should tell PUC officials that this increase should not be a carte= =20 blanche or blank check approval said Shames the head of Utility Consumer= s'=20 Action Network. The PUC needs to ensure that the rate increase requested b= y=20 the (state) is reasonable.=20 The public hearings are scheduled for:=20 ?Monday 1 p.m. San Diego Concourse Copper Room 200 C St. San Diego.=20 ?Monday 7 p.m. El Cajon Community Center 195 E. Douglas Ave. El Cajon.= =20 ?Tuesday 1 p.m. Country Inn Hotel 35 Via Pico Plaza San Clemente.=20 ?Tuesday 7 p.m. Center for the Arts 340 N. Escondido Blvd. Escondido.= =20 Port budget large but power bills loom=20 Slowing economy also cause for worry By Ronald W. Powell=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 The rock is rolling financially but there are indications that the blues= =20 lurk on the horizon.=20 Officials of the San Diego Unified Port District -- headquartered in a=20 block-shaped building some employees call the rock -- are happy with a=20 projected 2001-2002 budget that is 5.1 percent larger than the current one.= =20 Total revenue is expected to reach $208.7 million $10.2 million above what= =20 is expected in the fiscal year that ends June 30.=20 Port commissioners gave preliminary approval to the budget yesterday and ar= e=20 scheduled to take a final vote July 10.=20 But a slowing economy and surging electric bills are causes for concern.=20 Electricity costs are expected to rise from $5 million to $8.2 million in t= he=20 coming fiscal year.=20 As far as trends we see a continuation of the growth we've experienced ov= er=20 the past five years said Bruce Hollingsworth the port's treasurer. But= =20 our percentage of growth will not rise as sharply.=20 Port revenues have grown steadily since the 1997-1998 fiscal year when $16= 3=20 million was generated.=20 The proposed budget calls for adding 24 employees to the port's 730-member= =20 work force. New hires will include three Harbor Police officers 10 employe= es=20 in the aviation division and four in maritime services.=20 The port operates Lindbergh Field and administers nonmilitary tidelands alo= ng=20 San Diego Bay. It is landlord to more than 600 waterfront businesses and=20 operates two marine cargo terminals and one cruise ship terminal.=20 The budget calls for growth in each of the port's primary revenue centers:= =20 aviation real estate and maritime services.=20 Passenger and cargo activity at Lindbergh Field is expected to generate $90= .7=20 million or $5 million more than expected in the current year. Most of that= =20 increase is expected to come from parking-rate increases at the airport and= =20 at the port's long-term parking lot on Pacific Highway.=20 Rent from hotels and other businesses that are port tenants are expected to= =20 total $63.1 million up $1.8 million from the current budget.=20 Increases in cargo and cruise ship traffic are expected to boost maritime= =20 income by $2.7 million to a total of $18.4 million.=20 The port expects to spend $157 million on construction projects. They inclu= de=20 $8.5 million to relocate the General Services Department from Eighth Avenue= =20 and Harbor Drive in San Diego to National City and more than $5 million for= =20 paving and improvements at the 10th Avenue Marine Terminal.=20 Rent revenue could grow substantially in future years. Four hotel projects = on=20 port property have won approval or are seeking it.=20 Jim Bailey president of Manchester Resorts told commissioners yesterday= =20 that he expects to break ground on a second Hyatt tower of 750 rooms by Jun= e=20 26. Port officials said revenue from that hotel would bring in an additiona= l=20 $3.7 million a year. It is scheduled to open in the summer of 2003.=20 Hollingsworth the treasurer said that if all four hotels are built the po= rt=20 could receive as much as $15 million a year in new revenue.=20 Continuous use urged for planned power plant=20 Escondido facility originally proposed for peak demand By Jonathan Heller=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 ESCONDIDO -- A proposed power plant in southwest Escondido that initially w= as=20 expected to run only during times of peak electricity demand probably will = be=20 allowed to run full time.=20 A state energy official who recommended approval of the plant yesterday has= =20 said the plant could operate as often as the state deems necessary.=20 The California Energy Commission was scheduled to vote on the project today= .=20 CalPeak Power of San Diego has asked the commission to approve a 49-megawat= t=20 plant on Enterprise Street near Vineyard Avenue. Referred to as a peaker= =20 plant such facilities typically are designed to supply energy only during= =20 times of peak demand.=20 The state limits the number of hours some plants can operate to keep=20 pollution at a minimum. A 44-megawatt peaker plant being built on West=20 Mission Avenue in Escondido by Ramco Inc. will be allowed to operate no mor= e=20 than 16 hours per day.=20 That plant is permitted to emit up to 5 parts per million of nitrogen oxide= =20 although its actual emissions are expected to be slightly lower said Dale= =20 Mesple a Ramco consultant. Nitrogen oxide is a component of smog.=20 The CalPeak plant if approved would be restricted to 2 parts per million = of=20 nitrogen oxide.=20 It was generally assumed that the CalPeak plant would operate under similar= =20 time restrictions as the Ramco plant. The potential for air pollution was= =20 among the chief concerns of residents who spoke at the City Council hearing= s=20 on the Ramco project and at the energy commission hearings about the CalPea= k=20 plant.=20 But under the terms of approval recommended by Energy Commission Chairman= =20 William Keese CalPeak's plant would be able to operate up to 8760 hours= =20 per year typically when the demand for electricity is high. That number= =20 equals 24 hours a day.=20 The actual number of hours would depend on the requirements of the state's= =20 Independent System Operator which manages the energy grid.=20 We certainly want to have the flexibility to run whenever we're needed= =20 said Mark Lyons CalPeak's development director. Exactly how often we will= =20 run is anybody's guess.=20 Escondido Councilwoman June Rady said she was frustrated by the possibility= =20 of the plant running full time. In Ramco's case the city and the county Ai= r=20 Pollution Control District made it clear how often the plant could operate.= =20 CalPeak chose to bypass the city's permitting process and went through the= =20 state Energy Commission which offers an expedited 21-day approval put in= =20 place by Gov. Gray Davis as an emergency measure.=20 I think Escondido has been absolutely ignored and there's a total lack of= =20 due process Rady said. It boils down to an issue of local control.=20 Although city officials objected to the commission pre-empting the city's= =20 land-use authority the commission maintained that Davis' order gave it the= =20 final say on this type of project.=20 If the commission gives final approval today the only remedy available to= =20 the city would be in court. At least three council members must vote to=20 initiate legal action.=20 Keese's recommended approval did take into account several city concerns=20 regarding landscaping. The CalPeak plant would be built near the entrance o= f=20 a planned high-tech business park and city officials were worried the=20 plant's appearance might hinder the ability to attract high-quality tenants= =20 to the park.=20 Mayor Lori Holt Pfeiler said she was not surprised by the commission's=20 recommendation.=20 I expected they would want to approve the project and that's why it was= =20 important for the city to weigh in with conditions we have in this=20 community Pfeiler said.=20 Rising energy prices threaten Poway troupe=20 By Brian E. Clark=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 POWAY -- Rising electricity rates may extinguish the stage lights this summ= er=20 for the Poway Performing Arts Company.=20 I'm afraid that if SDG&E gets the price increase it's asking for -- from 6= .5=20 cents per kilowatt-hour to 8.9 cents -- that we'll go under said Kathy=20 McCafferty spokeswoman for the nonprofit theater.=20 The volunteer organization produces its plays in a building at a Poway Road= =20 shopping center. It held three fund-raising performances over the weekend= =20 but officials were uncertain yesterday how much money was raised.=20 The group is not affiliated with the Poway Performing Arts Center and has= =20 been in business for 20 years.=20 McCafferty said the group built up a $2000 surplus last summer before ener= gy=20 prices began to surge.=20 That $2000 was a big reserve for us she said. It seemed like a ton of= =20 money but boy it went fast. And we're really energy-dependent. Our light= s=20 use a lot of power. And we're in Poway on the second floor of our building.= =20 It gets hot here and we have to use air conditioning.=20 But McCafferty acknowledged that the cost of power isn't the group's only= =20 problem.=20 In a recent letter to backers President Nan Katona said the organization= =20 also needs new blood to keep operating.=20 The truth is that lack of funding is just a symptom of the deeper problem= =20 which is lack of community support she wrote. Ironically audiences and= =20 reviewers recognize the Poway Performing Arts Company as one of the premier= =20 community arts theaters in San Diego.=20 Katona said some new volunteers had stepped forward to take leadership role= s=20 in the theater company since she wrote her letter last month. But she said= =20 rising electricity prices could still bring the group down.=20 If our energy bills double or triple we could be in dire straits she=20 said. It could push us over the edge financially.=20 McCafferty said it would be difficult for the theater to cut costs.=20 We can't run a much leaner operation she said. If our power prices go u= p=20 again we may still be forced out of business.=20 The theater is at 13250 Poway Road in the Lively Shopping Center. For more= =20 information call (858) 679-8085.=20 Fair to use generators for midway attractions=20 By Michael Burge=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 DEL MAR -- The Del Mar Fair will generate its own electricity for thrill=20 rides on the midway this year instead of using energy from SDG&E.=20 In case there are planned or unplanned outages we still will be operating= =20 fairgrounds General Manager Timothy J. Fennell said.=20 Fennell decided to put the midway on generators because he didn't want the= =20 fairgrounds pulling power from the grid while county residents are coping= =20 with rolling blackouts at home and at work he said.=20 And the fair does not want to take a chance that a rolling blackout will=20 leave some people stranded in rides high above the grounds forcing an=20 evacuation.=20 The fairgrounds has been told it is exempt from rolling blackouts but rath= er=20 than take such a risk it will rent 13 diesel-fuel generators and produce=20 electricity on the midway. The rest of the fairgrounds will use power from= =20 San Diego Gas & Electric Co.=20 Fairgrounds operations manager Larry Baumann estimated it would cost the=20 fairgrounds $20000 more to generate its own electricity than to buy it fro= m=20 SDG&E.=20 Midway manager Donna Ruhm said it will be worth it.=20 Rides that require evacuation have to have backup power and they do Ruhm= =20 said. Now our service won't be interrupted.=20 It is not unusual for carnivals to generate their own power and the=20 fairgrounds has done so in the past. Fair officials removed the generators = 10=20 to 15 years ago to reduce noise on the midway.=20 The fair opens June 15 and ends July 4.=20 While the rest of the fairgrounds is on the SDG&E grid Baumann said backup= =20 generators can kick in during a typical 60-or 90-minute blackout allowing= =20 the fair to operate without serious difficulty. Those generators are not=20 linked to the midway.=20 All the generators are licensed by the state and meet emission standards= =20 fair officials said so they do not expect the noise and odor to be=20 excessive.=20 The fairgrounds is taking the precaution of providing its own power despite= =20 the fact that it probably will not go dark during a rolling blackout.=20 SDG&E has assured me that .?.?. the fairgrounds and the racetrack will not= =20 be on the curtailment (blackout) list during the fair and the races said= =20 Del Mar Fire Chief Jack Gosney.=20 The Del Mar Thoroughbred racing season begins July 18 and ends Sept. 5.=20 Gosney said SDG&E told him earlier this year that the fairgrounds was not= =20 subject to a forced outage because it shared a circuit with the Del Mar Fir= e=20 Station which is a 911 dispatch center and exempt from a blackout. But he= =20 said recent research showed that the fairgrounds is on a separate circuit.= =20 Nonetheless Gosney said SDG&E is exempting the fairgrounds and racetrack= =20 during the busy summer season.=20 The fairgrounds paid $137152.95 for its electricity usage from March 12 to= =20 April 10. It paid $51845.39 for electricity during the same period last ye= ar. ?=20 Wednesday June 6 2001=20 'Hi My Name Isn't Justice Honey' and Shame on Lockyer=20 By TOM G. PALMER ?????Here's what California Atty. Gen. Bill Lockyer said at a press=20 conference about Enron Corp. Chairman Kenneth Lay: I would love to=20 personally escort Lay to an 8-by-10 cell that he could share with a tattooe= d=20 dude who says 'Hi my name is Spike honey.'=20 ?????Here's why Lockyer should be removed from his office of public trust:= =20 First because as the chief law enforcement officer of the largest state in= =20 the nation he not only has admitted that rape is a regular feature of the= =20 state's prison system but also that he considers rape a part of the=20 punishment he can inflict on others.=20 ?????Second because he has publicly stated that he would like to personall= y=20 arrange the rape of a Texas businessman who has not even been charged with= =20 any illegal behavior.=20 ?????Lockyer's remarks reveal him to be an authoritarian thug someone whol= ly=20 unsuited to holding an office of public trust.=20 ?????But his remarks do have one positive merit: They tell us what criminal= =20 penalties really entail.=20 ?????Contrary to some depictions of prisons as country clubs they are=20 violent and terrible places. More and more politicians propose criminal=20 sanctions for more and more alleged misdeeds and as a result ever more kin= ds=20 of behavior are sanctioned by criminal penalties perhaps now even selling= =20 electricity. Those found guilty of such crimes are put into cages where th= ey=20 are deprived of their liberty and dignity and as Lockyer so clearly=20 acknowledged raped and brutalized. What's worse Lockyer has indicated tha= t=20 he believes that rape is an appropriate part of the system of punishments h= e=20 administers.=20 ?????Should it matter that Lay is a businessman? Imagine the outcry if the= =20 head of Enron were female. What would Lockyer's fellow Democrats have said = to=20 that?=20 ?????Should it matter that Lay is chairman of an electricity generator? Doe= s=20 the nature of his business justify threats to escort him to his own rape?= =20 Lockyer told the Los Angeles Times that he had singled out Enron's chairman= =20 because the Houston-based company is the world's largest energy trader.=20 ?????So apparently singling out a man for a heinous threat is OK because he= 's=20 the chairman of the world's largest energy trading company. That's accordin= g=20 to the man who as a state senator sponsored California's 1984 hate-crimes= =20 law. Evidently the crusader against intimidation on the basis of race=20 religion and sexual orientation feels no hesitation at all about intimidati= ng=20 someone and threatening him with the brutal use of physical force simply=20 because he heads the world's largest energy trading company.=20 ?????Lockyer and Gov. Gray Davis seem to think that the best way to keep th= e=20 lights on is to threaten electricity producers with brute force rather tha= n=20 to offer to pay competitive rates in competitive markets. Are energy=20 producers to blame for California's energy problems? No. Bad policies=20 including rigid controls on retail prices of electricity are the cause of= =20 the problem not the people who generate energy. Scapegoating producers and= =20 threatening them with violence is an old ploy of authoritarians. California= ns=20 should not stand for it.=20 ?????An Enron spokesman said that Lockyer's chilling stated desire to arran= ge=20 the rape of Lay does not merit a response. The spokesman is wrong. Lockyer'= s=20 remarks merit public disgrace and removal from office. After all rape is n= ot=20 a form of legal justice in America--is it?=20 - - - Tom G. Palmer Is a Senior Fellow at the Cato Institute in Washington. E-mai= l:=20 Palmert@cato.org Copyright 2001 Los Angeles Times=20 California Metro Desk=20 U.S. Probes Alleged Pact Not to Build New Plants Power: Justice officials= =20 focus on Southland operations of two firms which deny wrongdoing. MYRON LEVIN NANCY RIVERA BROOKS ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 The U.S. Department of Justice has launched an investigation into whether t= wo=20 companies that control a large swath of Southern California 's electricity= =20 supply agreed to limit power plant construction potentially hindering=20 crucial energy production according to federal records and interviews.=20 The civil antitrust probe of Williams Energy Services and AES Southland=20 represents the Justice Department's first foray into the activities of ener= gy=20 suppliers who have reaped huge profits in California 's price-shocked marke= t.=20 AES disclosed the investigation which began last month in a filing with t= he=20 Securities and Exchange Commission on Tuesday. In its papers AES said the= =20 Justice Department is focusing on whether its agreement with Williams could= =20 constrain future power plant construction in Southern California .=20 The investigation comes at a time when the state is scrambling to get new= =20 generators built and running to avoid blackouts and economic problems.=20 The government alleges that AES and Williams agreed to limit the expansion = or=20 construction of new power plants near three facilities purchased by AES in= =20 1998 from Southern California Edison under the state's new deregulation pla= n.=20 The plants--in Long Beach Huntington Beach and Redondo Beach--are owned by= =20 AES but the electricity is sold by Williams. Under a 3-year-old deal know= n=20 as a tolling agreement Williams essentially rents out the capacity of the= =20 plants for annual payments to AES. Williams supplies natural gas to fire th= e=20 plants and sells the electricity under long-term contracts and in the costl= y=20 spot market.=20 Williams and AES have similar tolling agreements at plants in Pennsylvania= =20 and New Jersey. However AES spokesman Aaron Thomas said the Justice=20 Department's investigative requests have focused only on agreements between= =20 Williams and AES in Southern California .=20 Thomas would say only that the agreement at the center of the investigation= =20 is simply a delineation of how expansion or repowerings are done at the=20 facilities.=20 The three plants have a combined capacity of more than 3900 megawatts=20 enough to supply about 3 million homes. This summer AES is bringing anothe= r=20 450 megawatts on line by reactivating two mothballed generators in Huntingt= on=20 Beach.=20 Paula Hall-Collins a spokeswoman for Tulsa-based Williams Cos. said she= =20 believes that the investigation is unrelated to a recent inquiry by the=20 Federal Energy Regulatory Commission into whether AES and Williams=20 unnecessarily shut down plants to jack up prices. A portion of that=20 investigation was settled in April when Williams without admitting any=20 wrongdoing agreed to pay about $8 million.=20 We've always maintained that we've operated within the law and we're=20 certain the investigation by the DOJ will find we are operating legally= =20 Hall-Collins said.=20 Williams and AES are among the power plant owners and marketers that have= =20 been lambasted by Gov. Gray Davis because of gold-plated electricity prices= =20 that have pushed the state's biggest utilities to the edge of ruin and are= =20 steadily draining the state's budget surplus.=20 State officials are asking FERC to revoke the rights of AES and Williams to= =20 sell electricity at whatever price the market will bear. That right was=20 granted for three years beginning in 1998 by federal regulators when=20 California 's $28-billion electricity market was opened to competition.=20 Under that plan the rights of AES and Williams to sell into the market are= =20 the first to come up for renewal.=20 AES Southland and Williams Energy Services are both arms of large energy=20 companies--AES Corp. of Arlington Va. and Williams Cos. of Tulsa Okla. California Metro Desk=20 Natural Gas Power Prices Drop Sharply Energy: More conservation mild=20 weather are among factors keeping costs down experts say. RICARDO ALONSO-ZALDIVAR NANCY VOGEL ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 WASHINGTON -- The wholesale prices of electricity and natural gas in=20 California have fallen sharply in recent weeks and experts said Tuesday th= at=20 the relief could be the harbinger of an energy turnaround.=20 Or it may be just a blip.=20 In the last couple of weeks California power prices have plunged to the=20 lowest levels since April 2000 traders say with electricity selling on so= me=20 days for less than $100 per megawatt-hour.=20 At night when demand slackens power sometimes sells for less than $20 per= =20 megawatt-hour. That is reminiscent of the days before prices went haywire= =20 last summer.=20 It is a drastically different scenario than the $500 to $800 the state paid= =20 during a spate of hot weather last month.=20 Meanwhile wholesale natural gas prices at a bellwether pipeline junction o= n=20 the Southern California -Arizona border dipped last week to their lowest=20 levels since November according to a publication that tracks the industry.= =20 Separately Southern California Gas Co. and Pacific Gas & Electric Co.=20 reported June rate cuts for their residential gas customers of 16% and 38%= =20 respectively.=20 Experts credited a combination of conservation mild weather a burst of=20 increased hydroelectric generation and lower natural gas prices for the dro= p=20 in electricity costs.=20 Conservation is starting to worry the generators which is nice to see= =20 said Severin Borenstein director of the University of California Energy=20 Institute in Berkeley. Californians used 11% less energy last month than in= =20 May 2000 according to the state Energy Commission.=20 I'm worried that if we don't push harder on conservation [prices] won't= =20 stay down Borenstein added.=20 On the natural gas side experts said the price decline is due to replenish= ed=20 storage within California a nationwide drop in the cost of the fuel and= =20 easing demand from power plants.=20 The number of shippers competing to get natural gas to the state has also= =20 increased with the expiration of a controversial contract on the El Paso= =20 pipeline system last week.=20 But economists were reluctant to make sweeping predictions based on the=20 latest indicators.=20 It's hard to draw specific conclusions said Bruce Henning who tracks th= e=20 natural gas markets for Energy and Environmental Analysis Inc. an Arlingto= n=20 Va. consulting firm.=20 How the summer turns out depends on the weather in the state Henning said= =20 adding The weather represents the balance in the Southern California=20 market.=20 Natural gas fuels most California power plants. With wholesale prices=20 recently averaging three to four times the rates charged elsewhere in the= =20 country state and federal officials have despaired of chances for=20 controlling electricity costs.=20 Last Friday however the daily price for immediate delivery of natural gas= =20 in Topock Ariz. a pipeline junction near the California border dipped to= =20 $7.85 per million British thermal units.=20 According to Natural Gas Week it was the first time since mid-November tha= t=20 the price at that location had fallen below $8 per million BTUs. One millio= n=20 BTUs is what a typical Southern California home uses in five or six days.= =20 Considered a bellwether for other pipeline systems serving California the= =20 Topock price reached a record $56.54 per million BTUs on Dec. 8. It stood a= t=20 $9.36 per million BTUs at the close of business Tuesday still below recent= =20 weekly averages.=20 Other industry publications have also picked up signals of price declines.= =20 Platts the energy information division of McGraw-Hill Cos. reported Tuesd= ay=20 that the price for monthly gas delivery contracts to California fell 22% in= =20 June following a nationwide trend.=20 But Henning said the drop in California prices is attributable to both lowe= r=20 prices around the country and a decline in the high markups for shipping ga= s=20 to California . Those markups which far exceed the cost of transporting ga= s=20 have drawn the attention of state and federal investigators.=20 Henning said the markups are declining as depleted storage levels in=20 California are replenished. Storage levels have been filling very rapidly= =20 and that fact is reflected in prices coming down he said.=20 The link between natural gas and electricity prices is a hotly debated=20 subject. Some experts say high-priced natural gas is driving up the cost of= =20 electricity . Others believe that record prices for power are raising the= =20 prices that generators are willing to pay for their fuel.=20 Electricity prices that range from $20 to $200 per megawatt-hour--instead o= f=20 the $150 to $500 per megawatt-hour paid in recent months--are great news fo= r=20 Gov. Gray Davis.=20 Average daily power prices in California for transactions through the=20 Automated Power Exchange have dropped from $149 per megawatt-hour last Frid= ay=20 to $110 per megawatt-hour Tuesday. The exchange is a private company that= =20 brings together electricity buyers and sellers and accounts for less than 1= 0%=20 of the state's market.=20 Davis spokesman Steve Maviglio said Tuesday that average daily power=20 purchases by the state have recently dipped below $50 million.=20 The state has sometimes had to pay more than $100 million a day since it=20 started buying power in January through the Department of Water Resources.= =20 The state stepped in because California 's two biggest utilities became too= =20 financially crippled to withstand the prices being charged by generators.= =20 Davis' plan to pay for past and future energy purchases with a $12.4-billio= n=20 bond issue hinges on an assumption that power prices will be driven down th= is=20 summer through long-term contracts conservation and the construction of ne= w=20 power plants.=20 UC Berkeley's Borenstein said conservation efforts have not gone far enough= .=20 You walk into most buildings and you still need a sweater he said. That= =20 ain't the way to hit the target.=20 If Californians conserved an additional 10% off their peak usage on hot=20 afternoons he said we could really break the backs of the generators we= =20 could really collapse the price.=20 Prices tend to skyrocket in California 's electricity market on hot=20 afternoons when demand soars and grid operators must scramble to purchase= =20 enough electricity . Cool weather which reduces demand for air conditionin= g=20 and conservation help keep the state from reaching such crisis situations.= =20 Borenstein said he believes generators are also asking less money for their= =20 electricity in part because of a federal order that took effect last month.= =20 The order limits the price power plant owners can charge when California 's= =20 supplies are strained.=20 Power sellers say there are more fundamental forces at work.=20 There's more supply relative to demand which is softening prices said= =20 Gary Ackerman executive director of the Western Power Trading Forum. The= =20 market is working and it's providing cheaper wholesale power more quickly= =20 than any regulatory scheme could ever do.=20 *=20 Times staff writer Dan Morain in Sacramento contributed to this story.=20 RELATED STORY=20 PG&E wins: The utility averted a $1-billion bill for power buys. B6=20 (BEGIN TEXT OF INFOBOX / INFOGRAPHIC)=20 A Blip or a Trend?=20 Daily natural gas prices at the California border with Arizona--considered = a=20 bellwether of the state's costs--have been declining in the last two weeks.= =20 *=20 Natural gas price per 1 million Btu=20 $9.36=20 Source: Natural Gas Week California Metro Desk=20 The State Utility Averts $1 Billion in Costs Courts: PG&E and Cal-ISO agree= =20 to recognize Department of Water Resources as purchaser of the power. TIM REITERMAN ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-6=20 Copyright 2001 / The Times Mirror Company=20 SAN FRANCISCO -- Pacific Gas & Electric Co. and the state's power grid=20 operator reached an agreement Tuesday that insulated PG&E at least=20 temporarily from more than $1 billion in power purchases the state made for= =20 its customers.=20 The California Independent System Operator sent $1.26 billion in invoices t= o=20 the utility for power purchases by the state Department of Water Resources= =20 for PG&E customers from January through March.=20 But the utility contended in Bankruptcy Court proceedings that it was not= =20 liable for such purchases and that continued purchases would cause annual= =20 losses of $4 billion.=20 After arguments before Judge Dennis Montali PG&E and Cal-ISO agreed that t= he=20 Department of Water Resources not PG&E purchased the power. Cal-ISO had= =20 argued that it was making the purchases on PG&E's behalf.=20 PG&E wants to be a utility and have obligations to serve customers but th= ey=20 don't want to pay for it Cal-ISO general counsel Charles Robinson said=20 later.=20 If PG&E refuses to pay the invoices Robinson said Cal-ISO will send the= =20 bills to the Department of Water Resources and officials there can decide= =20 whether to pursue claims in Bankruptcy Court. A spokesman for department= =20 which has authorization to sell $13 billion in bonds for power purchases= =20 said the agency will have no comment until the matter can be studied.=20 State agencies have stayed out of the bankruptcy proceedings hoping to=20 preserve their immunity from suits in federal court.=20 The agreement will be submitted for Montali's approval Monday but the judg= e=20 said it would not be binding on the department because no one represented t= he=20 agency in court.=20 PG&E's own production and contracts provide the majority of the power for i= ts=20 customers. But state legislation adopted this year allows the department to= =20 secure power contracts to serve customers of ailing utilities. When a=20 shortage threatens the power grid the department purchases additional powe= r=20 through Cal-ISO on the spot electricity market.=20 PG&E filed for Chapter 11 protection from creditors on April 6 saying it w= as=20 $9 billion in debt.=20 Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited=20 David Lazarus Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 California electricity prices have plunged unexpectedly to their lowest lev= el=20 in more than a year partly as the result of a simultaneous drop in prices= =20 for natural gas which fuels most power plants.=20 Make no mistake: Gas and electricity prices could surge upward again in=20 months ahead.=20 But for the first time since California's energy markets went haywire last= =20 summer industry experts are beginning to ask whether the state finally may= =20 have turned a corner in its battle with runaway power costs.=20 California is not yet out of the woods said Kelley Doolan who tracks=20 natural gas prices for energy market researcher Platts. But this is a very= =20 significant decrease in costs.=20 Along with lower gas prices the decline in electricity costs was attribute= d=20 by state and industry officials to milder weather which reduces demand for= =20 power. They also credited recent conservation efforts by consumers and=20 better-than-expected runoff at dams for hydroelectric plants.=20 Gary Ackerman executive director of the Western Power Trading Forum an=20 energy-industry association said these factors came together to produce th= e=20 lowest wholesale electricity prices since April 2000.=20 Electricity on the spot market could have been purchased yesterday for as= =20 little as $50 per megawatt hour he noted compared with more than $500=20 earlier this year.=20 If the weather stays this way we could have reasonable prices all summer= =20 Ackerman said. We may also have fewer blackouts.=20 It is tempting for Californians to be suspicious of virtually any swing in= =20 energy prices. If power companies manipulated prices on the way up as=20 critics have alleged might they not be up to some trick as prices head in= =20 the opposite direction?=20 Nettie Hoge executive director of The Utility Reform Network in San=20 Francisco speculated that generators are allowing electricity prices to fa= ll=20 so they can discourage federal regulators from taking a more active role in= =20 the dysfunctional California market.=20 They're trying to take the heat off she said.=20 Others cautioned that the lower prices may be nothing more than a statistic= al=20 blip.=20 This was just one month's decline said Michael Shames executive directo= r=20 of the Utility Consumers' Action Network in San Diego. We really have to s= ee=20 how this plays out in the future.=20 Steve Maviglio a spokesman for Gov. Gray Davis said the governor was very= =20 encouraged by the lower energy prices. Davis announced Sunday that=20 California's power use was down 11 percent last month from a year before.= =20 We're not there yet Maviglio said of whether an end to the state's power= =20 woes is in sight. But the trend is pointing in the right direction.=20 WHITE ELEPHANT Yet this sudden drop in energy prices does have a dark side: California cou= ld=20 end up with a huge white elephant after spending about $40 billion in publi= c=20 funds on long-term power contracts.=20 The logic behind the contracts which are at an average price of $69 per=20 megawatt hour over 10 years is that the state expected to pay below-market= =20 rates for electricity for a number of years before prices came down and=20 California found itself paying above-market rates.=20 If current trends continue though California will find itself paying=20 consistently above-market rates much sooner than expected making the long-= =20 term contracts a sweet deal for the same power companies that profited so= =20 handsomely during the state's darkest hours.=20 The contracts look really ugly right now said Shames at the Utility=20 Consumers' Action Network. They may be way overpriced.=20 Maviglio the governor's spokesman said it is too early to conclude that t= he=20 state did poorly negotiating dozens of long-term power contracts.=20 No one has a crystal ball on this he said.=20 CUSTOMERS' BILLS TO DROP In any case Pacific Gas and Electric Co. said yesterday that customers'=20 average gas bills will drop 26 percent this month to $26 and should stay ne= ar=20 that level all summer.=20 Platts which monitors average monthly spot prices found that the wholesal= e=20 price of gas at the California-Oregon border has tumbled nearly 42 percent= =20 since the beginning of May -- from $9.98 per million British thermal units = to=20 $5.81.=20 The wholesale gas price at the California-Arizona border fell 45 percent= =20 from $11.91 to $6.50. This compares with a 25 percent monthly decline in=20 average natural gas prices nationwide.=20 However California gas prices are still about 50 percent higher than they= =20 were a year ago whereas national prices are now below year-ago levels for= =20 the first time since last spring.=20 While cooler weather nationwide helped push gas prices down overall Doolan= =20 attributed the especially steep drop in California to a commensurate surge = in=20 prices last month related to fears of a long hot summer of rolling=20 blackouts.=20 You had state officials all but promising rolling blackouts this summer = he=20 said. That created enormous demand for electricity generation.=20 What has changed is that we've had weeks of mild weather Doolan observed= .=20 The electricity generators have not come out of the woodwork buying up all= =20 the gas.=20 This allowed utilities like PG&E to beef up gas inventories which eased=20 demand and resulted in substantially lower prices he said.=20 'BACK ON TRACK'=20 We're back on track to be completely full for winter said Staci Homrig = a=20 PG&E spokeswoman. That's a very good thing.=20 Gas prices historically dip in the spring and summer and then rise again in= =20 the winter. PG&E is forecasting that customers' average gas bills could ris= e=20 to as high as $75 in December if current trends continue.=20 However the precipitous drop in gas prices in recent weeks suggests that= =20 California's unusually high costs at last may be abating.=20 Individual power companies so far are reluctant to speculate on whether the= =20 drop in gas prices will have a lasting effect on electricity costs.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 San Jose council gives green light to generating plant=20 VOTE REVERSAL: Officials pressured to OK project=20 Marshall Wilson Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 In a clear sign that the political landscape has shifted because of the=20 state's power crisis the San Jose City Council gave a green light yesterda= y=20 for construction of a generating plant it had unanimously opposed in=20 November.=20 Yesterday's 10-to-1 vote came after months of mounting pressure for the cit= y=20 to reverse course and approve the controversial 600-megawatt Calpine plant = at=20 Coyote Valley.=20 That pressure -- increased by the occasional rolling blackout -- has come= =20 from nearly every corner of the state from elected officials to high-tech= =20 businesses and labor unions worried the power crisis will drain away jobs= =20 ruin the economy and lead to voter backlash over skyrocketing energy bills.= =20 Even the local branch of the NAACP and environmentalists pushed the council= =20 to approve the Calpine proposal -- despite overwhelming opposition from the= =20 plant's neighbors.=20 Council members did not hide their disdain yesterday for being forced to=20 reconsider their opposition to the so-called Metcalf Energy Center.=20 I'm holding my nose to vote for this thing said Councilwoman Linda=20 LeZotte.=20 I'm just as unhappy as everybody else Vice Mayor George Shirakawa said. = I=20 feel like no matter what happens we can't win.=20 GOVERNOR OFFERED HIS SUPPORT After the council's solid opposition in November Calpine appealed to the= =20 California Energy Commission which has the final say. The controversial=20 plant then received a huge boost in April when Gov. Gray Davis threw his=20 support behind it.=20 San Jose officials conceded yesterday that the energy commission was likely= =20 to override their opposition and grant approval within a few weeks. They sa= id=20 the commission's likely approval was stripping them of their power to decid= e=20 local land-use issues.=20 What I think has happened . . . is the governor and the Legislature at the= =20 state level have taken this out of our hands said Councilwoman Pat Dando.= =20 I don't think there's any chance at all the California Energy Commission i= s=20 going to turn down the Metcalf Energy Center Councilman Chuck Reed said.= =20 CONSTRUCTION MAY BEGIN SOON If given the go-ahead by the state Calpine could begin construction as ear= ly=20 as next month. The natural-gas fired plant would generate electricity by=20 mid-2003 company spokesman Kenneth Arbeu said.=20 At the urging of Mayor Ron Gonzales the council yesterday approved a new= =20 cooperation agreement with Calpine. The vote with Councilman Forrest=20 Williams casting the lone nay is preliminary while a final vote that is=20 scheduled for June 26.=20 Gonzales argued that the agreement did not amount to a flip-flop because it= =20 differs from what Calpine proposed in November.=20 The agreement approved by the council calls for increased monitoring of air= =20 pollution the use of treated wastewater to cool the plant which will redu= ce=20 discharges into San Francisco Bay and a $6.5 million community benefits= =20 package with the bulk going toward parkland acquisition Gonzales said.=20 This council has not changed its decision he said. What we've done is= =20 change the facility.=20 Critics incensed that the city was buckling to outside pressure vowed to= =20 change the council at the next election.=20 CONCERNS OVER HEALTH RISKS They raised concerns that boiled wastewater steam wafting over their homes= =20 from Calpine's plant could pose health risks. Jona Denz-Hamilton said more= =20 controls are needed to ensure the safety of neighbors like herself and her= =20 family and argued that new cleaner-burning technologies should be installe= d=20 at the plant.=20 It's too great of a risk she said.=20 Other critics said the state's energy woes will be solved and largely=20 forgotten by the time the plant opens in two years while the Santa Teresa= =20 neighborhood will be stuck with pollution for decades.=20 Approval seemed a given at the start of the more than three-hour hearing.= =20 Much of the afternoon's debate focused around plans to extend a pipeline fo= r=20 treated wastewater to the new plant.=20 Critics said Calpine was receiving a sweet deal by paying only $10 million = of=20 the $50 million cost of extending the pipeline. Several council members ask= ed=20 for a more detailed report into the financing plan before the final vote is= =20 taken June 26.=20 Chronicle staff writer Bill Workman contributed to this report.=20 E-mail Marshall Wilson at 2001 San Francisco Chronicle ? Page?A - 1=20 Developments in California's energy crisis=20 Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate1 053EDT0177.DTL=20 (06-06) 07:53 PDT (AP) --=20 Developments in California's energy crisis:=20 WEDNESDAY: * No power alerts Wednesday as reserves stay above 7 percent.=20 TUESDAY: * Gov. Gray Davis' administration says the state's electricity costs are=20 dropping substantially even as it asks state legislators for another=20 half-billion dollars for power purchases. That brings to $8.2 billion the= =20 amount the state is paying for electricity on behalf of three financially= =20 strapped utilities.=20 Spokesman Steve Maviglio says the cost to the state treasury has dropped in= =20 the last few weeks well below the $50 million dollars the state had been=20 paying on a typical day. He credits cooler weather conservation more powe= r=20 plants online and more long-term contracts with helping drive down the cost= .=20 * A state Senate committee agrees to issue subpoenas to eight out-of-state= =20 electricity generators demanding they hand over documents on bidding prici= ng=20 and other aspects of power sales in the state. The subpoenas would help a= =20 special Senate committee's investigation into whether the companies are=20 illegally profiteering from California's power crisis. The committee's=20 chairman says he expects the companies to resist setting the stage for a= =20 court battle.=20 * Oil giant Chevron threatens to cut gasoline production in California unle= ss=20 it is exempted from rolling blackouts. The San Francisco Chronicle says it= =20 has a copy of a letter sent Friday from Chevron chairman David O'Reilly to= =20 Davis. In the letter O'Reilly says the company will scale back gasoline=20 production at its Richmond and El Segundo plants operating those refinerie= s=20 only with power produced by generators at the sites.=20 * New U.S. Senate Majority Leader Tom Daschle D-S.D. supports Federal=20 Energy Regulatory Commission price caps. FERC must meet its obligation und= er=20 current law to ensure 'just and reasonable' prices for wholesale electricit= y=20 in the state of California. FERC has failed to meet this responsibility...= =20 Daschle says in a letter to Davis. Unless FERC acts soon Senator (Dianne)= =20 Feinstein's legislation should be taken up and passed to direct FERC to tak= e=20 action. I will support all necessary efforts to meet that goal.=20 * House Subcommittee on Energy Policy Natural Resources and Regulatory=20 Affairs Chairman Doug Ose R-Sacramento cites Electric Utility Week figure= s=20 that FERC's limited price caps helped cut California's power rates from $30= 0=20 to $108.47 per megawatt hour within an hour after taking effect last week.= =20 While he says more information is needed Ose uses the figures to tout his= =20 pending bill to impose the price caps around the clock and to all Western= =20 states.=20 * Pacific Gas & Electric Co. asks U.S. Bankruptcy Judge Dennis Montali to= =20 stop the manager of the state's power grid from buying electricity for=20 utility or charging it for any electricity bought after the utility filed f= or=20 bankruptcy on April 6. Separately the utility's creditors support its=20 request to the bankruptcy court to pay out $17.5 million in bonuses to the= =20 management team that guided the utility into bankruptcy.=20 * California Department of Water Resources reveals it is negotiating with= =20 municipal utilities to buy their surplus power. Department spokesman Oscar= =20 Hidalgo says talks began last week but no agreements are imminent.=20 * State lawmakers criticize a $3 million lobbying campaign by Southern=20 California Edison. The utility is telephoning shareholders to describe the= =20 dire consequences if the utility goes bankrupt. The call is then transferre= d=20 to the state Capitol so shareholders can implore lawmakers to support a=20 controversial plan to help the utility. Legislators and their staffers say= =20 the shareholders often are confused and scared their investments will be=20 degraded or wiped out.=20 * State Treasurer Phil Angelides joins an advocacy group for the poor in=20 urging the state's huge pension funds to use their economic power to levera= ge=20 power companies. The Pacific Institute for Community Organization says the= =20 two pension funds own at least $1.2 billion in stocks and bonds in most of= =20 the firms that sell electricity to California.=20 * The Assembly by a 69-0 vote approves a bill to spend $10 million on=20 environmental studies needed before Path 15 the inadequate transmission-li= ne=20 group between Northern and Southern California can be expanded. The bill= =20 moves to the Senate.=20 * Pacific Gas and Electric announces a decrease in natural gas prices down= =20 38 percent from May's rates and 66 percent lower than January's rates. The= =20 decline will bring the average residential gas bill to $26 when it goes int= o=20 effect June 7. Market analysts predict the rates will remain stable until= =20 December when demand is expected to increase with winter heating loads.=20 * No power alerts Tuesday as electricity reserves stay above 7 percent.=20 * Shares of Edison International closed at $10.05 down 53 cents. PG&E Corp= .=20 closed at $11.25 down 15 cents. Sempra Energy the parent company of San= =20 Diego Gas & Electric closes at $26.91 down 43 cents.=20 WHAT'S NEXT: * Davis' representatives continue negotiating with Sempra the parent compa= ny=20 of San Diego Gas and Electric Co. to buy the utility's transmission lines.= =20 THE PROBLEM: High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Edison and PG&E say they've lost nearly $14 billion since June to high=20 wholesale prices the state's electricity deregulation law bars them from=20 passing on to consumers. PG&E saying it hasn't received the help it needs= =20 from regulators or state lawmakers filed for federal bankruptcy protection= =20 April 6.=20 Electricity and natural gas suppliers scared off by the two companies' poo= r=20 credit ratings are refusing to sell to them leading the state in January = to=20 start buying power for the utilities' nearly 9 million residential and=20 business customers. The state is also buying power for a third investor-own= ed=20 utility San Diego Gas & Electric which is in better financial shape than= =20 much larger Edison and PG&E but also struggling with high wholesale power= =20 costs.=20 The Public Utilities Commission has approved average rate increases of 37= =20 percent for the heaviest residential customers and 38 percent for commercia= l=20 customers and hikes of up to 49 percent for industrial customers and 15=20 percent or 20 percent for agricultural customers to help finance the state'= s=20 multibillion-dollar power buys.=20 2001 Associated Press ?=20 California conserves=20 Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/E D86597.DTL=20 WHEN RAIN fails to fall from the sky Californians know why there is a=20 drought. But when rolling blackouts suddenly appeared in the dead of winter= =20 many of us wondered who was responsible for and who has profited from what= =20 now seems like an artificially created power shortage in the state.=20 Our skepticism proved to be right. Windfall profits were reaped by=20 electricity generators while natural gas importers extracted prices far abo= ve=20 the national average.=20 Timid federal overseers exact only wrist-slap penalties on the offending=20 energy firms. The White House scoffs at temporary controls for a=20 malfunctioning market. California's state government has ended up as the bi= ll=20 payer for the sickly utilities forking over $8 billion to generators. This= =20 number may hit $40 billion by year-end.=20 It's an infuriating tangle. All the more remarkable then that skeptical= =20 Californians have managed within two months to reduce their use of=20 electricity by 11 percent. The public's response to the governor's appeal f= or=20 energy conservation has exceeded expectations. Although many businesses hav= e=20 suffered enormous losses ordinary people have made relatively painless=20 sacrifices. People turned off their lights purchased energy-efficient=20 lightbulbs used air conditioning less and shut off their computers when no= t=20 in use.=20 Despite this remarkable civic compliance we still face an unconscionable= =20 lack of leadership. President Bush seems perfectly willing to allow Texas= =20 power companies to pummel the once-powerful California economy. He repeats = a=20 mantra about creating more supply -- which California is doing with 15 powe= r=20 plants under construction -- while ignoring the outsized sums paid to a=20 handful of energy generators.=20 At the same time Gov. Gray Davis who has given new meaning to the word=20 dithering has failed to make the tough and transparent decisions. He delay= ed=20 an inevitable rise in power rates. Davis also dragged his feet in openly=20 announcing new power contracts that commit California to billions in spendi= ng=20 over the next decade.=20 To Davis' credit he has urged California to conserve by laying out an $800= =20 million plan to cut power use and invest in energy-saving programs. The=20 message is getting out as higher rates take effect this month.=20 Despite a woefully unbalanced market and shortsighted leadership the peopl= e=20 of California have demonstrated that if there is a will there is a way.=20 Now it is time for our leaders to follow the wisdom of their constituents.= =20 2001 San Francisco Chronicle ? Page?A - 20=20 L.A. power customers awash in cheap energy=20 John Wildermuth Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/M N133438.DTL=20 Los Angeles -- These are flush times for the city's Department of Water and= =20 Power and the energy executives are loving every minute of it.=20 As are their customers.=20 Private power companies throughout California have been raising rates and= =20 warning customers about a long hot summer filled with blackouts but the= =20 city- owned DWP has been keeping prices stable and the lights on for 1.2=20 million Los Angeles customers.=20 Our customers are being really nice to us said Angelina Galiteva the=20 utility's strategic planning director. They love the DWP.=20 Although Gov. Gray Davis' administration announced that the state had reduc= ed=20 its energy consumption 11 percent from a year ago those in Los Angeles had= =20 cut back less than half that -- and polls show they view the energy situati= on=20 less seriously than other Californians.=20 Public utilities such as Los Angeles water and power have seen their revenu= es=20 increase during the energy crunch because they can sell their excess power = at=20 higher prices than ever before in a market tilted toward sellers.=20 The rest of the state doesn't always feel that same warm glow. Davis has=20 accused the DWP and other California public utilities of putting exorbitant= =20 price tags on the excess electricity they sell to the rest of the energy-= =20 starved state.=20 It's a charge Los Angeles utility executives deny arguing that their exces= s=20 power is sold at cost plus 15 percent which they say is a fair return for= =20 their customers.=20 Without our support a million more homes (elsewhere in California) would= =20 have suffered rolling blackouts which is a powerful message Galiteva sai= d.=20 It wasn't supposed to be this way. When the power industry was deregulated = in=20 the late '90s energy giants like Pacific Gas and Electric Co. and Southern= =20 California Edison were expected to be the big winners. Now PG&E is in=20 bankruptcy and Edison is a short step away.=20 When deregulation came the experts said that the investor-owned utilities= =20 would become lean mean machines that would be better able to operate in th= e=20 new environment Galiteva said. But now public power has shown it can ser= ve=20 customers more efficiently at lower rates.=20 While much of the state worries about electrical supply Los Angeles=20 residents have been saved many of those concerns.=20 In a survey done last month by the Public Policy Institute of California 4= 8=20 percent of the people in the Bay Area thought that electricity cost and=20 availability were the most important issues facing the state. In Los Angele= s=20 however only 33 percent put the energy crunch on top. When questioned abou= t=20 the size of the power problem and the effect it would have on the state's= =20 economy Los Angeles residents were consistently less concerned than people= =20 elsewhere in California.=20 People in Los Angeles have been somewhat isolated from the energy crisis= =20 concluded Mark Baldassare who conducted the survey.=20 That doesn't mean the state's energy problems haven't had an effect. The DW= P=20 has seen a 3 percent to 5 percent reduction in some uses which officials= =20 have dubbed sympathy conservation. The utility also is offering its bigge= st=20 customers financial incentives to cut back on their power use.=20 Our average annual load growth is about 80 megawatts Galiteva said. By= =20 this summer we expect to have saved 40 megawatts through conservation. By= =20 December we expect 60 megawatts in savings.=20 The utility also is making a major attempt to create a conservation ethic= =20 among its customers. DWP's comfortable situation has made it possible to=20 offer them the carrot without the need to show them the stick.=20 Conservation no longer means doing without Galiteva said. Beer can be= =20 just as cold with a superefficient refrigerator. Rooms can be just as brigh= t=20 with superefficient light bulbs.=20 A Green Power program also is promoting the use of renewable energy=20 resources such as solar wind and hydroelectric power. About 75000 custome= rs=20 are paying an extra $3 per month to increase DWP's use of renewable power= =20 sources.=20 We're trying to give our customers a choice and a voice in determining the= =20 mix of power they use Galiteva said. They know they can do (conservation= )=20 now or see it being mandated later.=20 Los Angeles power officials -- and their customers -- know the DWP isn't=20 always going to continue as an island of tranquility in a sea of energy=20 turmoil. The utility's aging gas-fired plants have been affected by the=20 rising price of natural gas. Demand for energy continues to rise. In a deba= te=20 last month both candidates for mayor of Los Angeles agreed that increases = in=20 local power bills are inevitable.=20 But the DWP has been supplying power to Los Angeles since 1916 and its=20 executives believe that the state's deregulation disaster has shown the=20 advantages of the city-owned utility.=20 It's nice to be the lean mean green efficient machine that no one ever= =20 expected us to become Galiteva said.=20 E-mail John Wildermuth at 2001 San Francisco Chronicle ? Page?A - 13=20 PG&E doesn't want to pay for energy to avert blackouts=20 DAVID KRAVETS Associated Press Writer Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate0 306EDT0102.DTL=20 (06-06) 00:06 PDT SAN FRANCISCO (AP) --=20 Pacific Gas & Electric Co. has told a bankruptcy judge it should not have t= o=20 pay for what could amount to billions of dollars in spot-market energy cost= s=20 to avert blackouts.=20 The company's position was one of two developments that emerged Tuesday as= =20 the bankrupt utility tries to cope with fallout from California's power=20 crisis. The other development saw a group of creditors that PG&E owes=20 billions endorse $17.5 million in bonuses for top managers at the utility.= =20 San Francisco-based PG&E filed for bankruptcy protection in April after=20 racking up an $8.9 billion debt which under state law it could not recoup= =20 from customers.=20 Tuesday's court dispute centered on who pays for energy bought at the last= =20 minute to avoid blackouts.=20 PG&E said an April federal regulatory decision requires that electricity ca= n=20 only be sold to those with the ability to pay electricity generators. The= =20 state is the only player with such ability said PG&E attorney Jerome Faulk= =20 who argued that the utility shouldn't have to pay the $330 million in month= ly=20 spot-market energy bills.=20 Judge Dennis Montali said he may craft such an order. But he said the order= =20 would not preclude the state from suing PG&E to recover the cost.=20 In a separate but related development a committee charged with devising a= =20 payment plan for those creditors owed billions by PG&E said it will sign of= f=20 on the utility's plan to pay $17.5 million in bonuses to PG&E's management= =20 team.=20 Attorney Allan Marks who represents the committee said such payments are= =20 normal during large bankruptcy cases. Under the agreement which Montali wi= ll=20 consider at a June 18 hearing the company must quickly produce a debt=20 payment plan that passes judicial muster.=20 The utility said it needs the bonuses for a management retention program.= =20 Marks agreed. While the $17.5 million leaves less for creditors without a= =20 financial incentive PG&E's key top brass may not be willing to cooperate wi= th=20 a payment plan Marks said.=20 The main goal for the creditors' support here is to move the bankruptcy as= =20 quickly and smoothly as possible Marks said.=20 The Utility Reform Network a consumer watchdog group says PG&E is simply= =20 rewarding managers of a failed business effort.=20 They're just showering money on the same people who got them in this mess= =20 said TURN's Mike Florio.=20 The proposed bonuses would come on top of $50 million in bonuses and raises= =20 PG&E awarded just before the April 6 bankruptcy filing.=20 The case is In Re Pacific Gas & Electric Co. 01-30923 DM.=20 2001 Associated Press ?=20 Metcalf plant gets preliminary approval=20 Posted at 12:21 a.m. PDT Wednesday June 6 2001=20 BY MIKE ZAPLER=20 Mercury News=20 As the San Jose City Council approached its 10-1 vote Tuesday to give an=20 initial nod to Calpine's big power plant in South San Jose Councilwoman=20 Linda LeZotte perhaps captured the body's mood best.=20 ``I'm holding my nose to vote for this thing'' she said. ``Without faultin= g=20 the mayor or his staff quite frankly I think this deal stinks.''=20 Caught in what some members called a bind beyond their control the council= =20 gave preliminary approval to an agreement negotiated by Mayor Ron Gonzales= =20 and Calpine on the company's proposed 600-megawatt Metcalf Energy Center.= =20 Councilman Forrest Williams who represents the Santa Teresa neighborhood= =20 near the site cast the lone vote against the deal.=20 The agreement is scheduled to come back before the council for a final vote= =20 on June 26 but Tuesday's vote effectively shifts the battle to the courts= =20 where residents are expected to lodge a lawsuit in one final attempt to blo= ck=20 the plant.=20 Still Councilwoman Pat Dando and some of her colleagues raised questions= =20 about the deal they said they want answered before the final vote. Their=20 issues could be incorporated into the final deal.=20 Many of the concerns focused on a $50 million recycled water pipeline=20 Gonzales agreed to have the city build to accommodate the project $10=20 million of which would be reimbursed by Calpine over 30 years.=20 Pipeline possibility=20 Dando said that a private company Great Oaks Water may be willing to buil= d=20 the pipeline extension itself saving the city the $50 million expense.=20 Officials at Great Oaks were unavailable Tuesday.=20 Council members peppered staff with other questions. Many were alarmed by= =20 claims of the Silicon Valley Toxics Coalition which said that using treate= d=20 sewage water to cool the power plant could allow dangerous chemicals to see= p=20 into drinking water aquifers. An environmental services director said the= =20 recycled water meets federal specifications but that there is no protocol= =20 for testing other chemicals not included in those standards.=20 Councilman Ken Yeager asked why Calpine should be allowed to spread a $3.9= =20 million water connection fee over 10 years -- an arrangement that would=20 mandate an amendment to city law.=20 LeZotte meanwhile said she wants to hold Calpine accountable to install= =20 ammonia-free technology at the plant. Ammonia is highly hazardous and=20 residents say the use of the chemical to clean the plant is among their chi= ef=20 concerns.=20 The agreement requires the company to install technology to reduce or=20 eliminate the use ammonia when it becomes ``technologically and economicall= y=20 feasible.'' LeZotte said she wants a clear definition of ``feasible''=20 included in the deal.=20 Tuesday's vote marked a stark departure from the council's November vote to= =20 deny Metcalf. At the time council members said a power plant was=20 inappropriate for the area and many members said Tuesday that they still= =20 believe that.=20 Bowing to pressure=20 But with Gov. Gray Davis endorsing Metcalf in April and the California Ener= gy=20 Commission widely expected to override the city's denial this month counci= l=20 members said they had no choice but to cut the best deal it could and allow= =20 the project to proceed.=20 That explanation however didn't sit well with residents of the Santa Tere= sa=20 neighborhood adjacent to the Metcalf site one of whom accused Gonzales and= =20 the council of ``switching sides when the opposing team gets too close to t= he=20 goal line.''=20 Contact Mike Zapler at mzapler@sjmercury.com or at (408) 275-0140.=20 Feds probe AES Williams=20 Antitrust investigation looks into allegations of manipulated energy prices= =20 through reduced power-plant construction.=20 June 6 2001=20 By JAMES ROWLEY Bloomberg News=20 WASHINGTON - The U.S. Justice Department opened an antitrust investigation= =20 into California's electricity shortage by probing allegations that AES Corp= .=20 and Williams Energy Services Co. are limiting power-plant expansion to driv= e=20 up prices.=20 AES Corp. the biggest U.S. power-plant developer disclosed the=20 investigation in a filing with the U.S. Securities and Exchange Commission.= =20 The Justice Department is looking into a supply-and-marketing agreement=20 between AES' California power-plant unit and a Williams unit that supplies= =20 natural gas.=20 Williams owner of the second-largest U.S. natural-gas pipeline system als= o=20 markets the power produced by AES' three electricity plants in the state.= =20 The department alleges the agreement limits expansion of generating capacit= y=20 near some AES plants.=20 AES said it was cooperating with the Justice Department investigation whic= h=20 began last month into possible violations of Section 1 of the Sherman=20 Antitrust Act.=20 That provision outlaws any restraint of trade that stifles competition.=20 A shortage of generating capacity in California has led to soaring wholesal= e=20 prices and rolling blackouts and prompted Pacific Gas & Electric the state= 's=20 largest utility to seek bankruptcy protection in April.=20 Aaron Thomas a spokesman for AES based in Arlington Va. said the U.S.= =20 investigation started no more than a couple of weeks ago.=20 Williams spokeswoman Paula Hall-Collins said the Tulsa Okla.-based company= =20 is cooperating.=20 Gina Talamona Justice Department spokeswoman said the agency had no=20 immediate comment.=20 The investigation was opened several weeks after the Federal Energy=20 Regulatory Commission investigated AES plants in Long Beach and Huntington= =20 Beach designated must run under the Federal Power Act did not produce= =20 electricity for 10 days in April and May 2000. Williams agreed to pay the= =20 operator of California's electric grid $8 million to settle allegations tha= t=20 it overcharged for power.=20 FERC charged in March that the companies had a financial incentive to keep= =20 the units out of service to force the California Independent System Operato= r=20 to buy power from AES' plant in Redondo Beach at prices close to the=20 FERC-imposed cap of $750 per megawatt-hour.=20 AES said it was complying with a Justice Department demand for documents=20 about the agreement between its AES Southland LLC unit and Williams Energy= =20 Services Co. AES Southland which operates the three power plants was also= =20 asked to respond to interrogatories the company said.=20 The Williams unit supplies the natural gas to fuel the AES plants and marke= ts=20 the power they produce.=20 AES and Williams jointly produce and sell about 4000 megawatts in Californ= ia=20 -- 6 to 8 percent of the state's power -- enough electricity to light about= 3=20 million typical California homes.=20 AES shares dropped $2.05 to $42.54. Williams Cos. shares dropped $1 to=20 $38.20. Calpine Begins Construction of Peaking Energy Center in Gilroy Calif.=20 June 6 2001=20 SAN JOSE Calif. June 5 /PRNewswire/ via NewsEdge Corporation -=20 Calpine Corporation (NYSE: CPN) the San Jose Calif.-based independent pow= er=20 company today announced that initial construction of 135 megawatts (mw) of= =20 peaking generation capacity will begin during this week adjacent to its=20 existing Gilroy Power Plant in Gilroy Calif. Through an Application for=20 Certification (AFC) filed with the California Energy Commission (CEC) on=20 April 25 2001 Calpine proposed to add three 45-mw simple-cycle gas turbin= e=20 peaking units in the first of a two-phase process. The California Energy=20 Commission approved the project on May 21 2001.=20 Because the required natural gas water and transmission infrastructure=20 exists at our Gilroy plant it is an ideal site for the addition of peaking= =20 generation allowing for rapid installation of needed capacity. The first= =20 three units are expected to begin generating electricity this September= =20 commented Bryan Bertacchi Calpine Vice President - Western Region.=20 Upon completion the two-phase build out the Gilroy Energy Center will be a= =20 270-mw natural gas-fired simple-cycle peaking generation facility located= =20 on approximately 9.5 acres at 1400 Pacheco Pass Highway in Gilroy. Commerci= al=20 operation of Phase One is scheduled for September 2001. An additional three= =20 45-mw gas turbine generators will be installed in Phase Two with full=20 build-out estimated for May 2002. Phase Two requires the filing of an=20 additional application with the CEC and is subject to a four-month review= =20 process.=20 Initial construction will begin this week with site and civil engineering= =20 activities occurring for approximately six weeks at which time the site wil= l=20 be cleared and leveled. Foundation work and the installation of generation= =20 equipment will follow shortly thereafter and commissioning and testing wil= l=20 take place for a two to three week period prior to commercial operation in= =20 September 2001.=20 The Gilroy Energy Center web site has been created to host all information= =20 and updates related to this project. For additional information please vis= it=20 www.gilroypower.com.=20 Calpine Corporation based in San Jose Calif. is dedicated to providing= =20 customers with reliable and competitively priced electricity. Calpine is=20 focused on clean efficient natural gas-fired generation and is the world'= s=20 largest producer of renewable geothermal energy. Calpine has launched the= =20 largest power development program in North America. To date the company ha= s=20 approximately 32200 megawatts of base load capacity and 7200 megawatts of= =20 peaking capacity in operation under construction pending acquisitions and= =20 in announced development in 29 states and Canada. The company was founded i= n=20 1984 and is publicly traded on the New York Stock Exchange under the symbol= =20 CPN. For more information about Calpine visit its Website at=20 www.calpine.com.=20 This news release discusses certain matters that may be considered=20 forward-looking statements within the meaning of Section 27A of the=20 Securities Act of 1933 as amended and Section 21E of the Securities=20 Exchange Act of 1934 as amended including statements regarding the intent= =20 belief or current expectations of Calpine Corporation (the Company) and i= ts=20 management. Prospective investors are cautioned that any such forward-looki= ng=20 statements are not guarantees of future performance and involve a number of= =20 risks and uncertainties that could materially affect actual results such as= =20 but not limited to (i) changes in government regulations including pendin= g=20 changes in California and anticipated deregulation of the electric energy= =20 industry (ii) commercial operations of new plants that may be delayed or= =20 prevented because of various development and construction risks such as a= =20 failure to obtain financing and the necessary permits to operate or the=20 failure of third-party contractors to perform their contractual obligations= =20 (iii) cost estimates are preliminary and actual cost may be higher than=20 estimated (iv) the assurance that the Company will develop additional=20 plants (v) a competitor's development of a lower-cost generating gas-fired= =20 power plant and (vi) the risks associated with marketing and selling power= =20 from power plants in the newly competitive energy market. Prospective=20 investors are also cautioned that the California energy environment remains= =20 uncertain. The Company's management is working closely with a number of=20 parties to resolve the current uncertainty while protecting the Company's= =20 interests. Management believes that a final resolution will not have a=20 material adverse impact on the Company. Prospective investors are also=20 referred to the other risks identified from time to time in the Company's= =20 reports and registration statements filed with the Securities and Exchange= =20 Commission.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Calpine Corporation=20 CONTACT: media Lisa Poelle ext. 1285 or investors Rick Barraza ext.=20 1125 both of Calpine Corporation 408-995-5115=20 Web site: http://www.gilroypower.com=20 Web site: http://www.calpine.com (CPN)=20 Reliant Urges FERC to Drop or Amend California Price Caps to Avoid Addition= al=20 Shortages and More Blackouts=20 June 6 2001=20 HOUSTON June 5 /PRNewswire/ via NewsEdge Corporation -=20 Reliant Energy (NYSE: REI) filed an emergency motion with the Federal Energ= y=20 Regulatory Commission (FERC) on Monday urging the agency to drop the=20 California price caps first applied May 29 or at a minimum amend them to= =20 reflect the true costs they are attempting to control. The current price=20 caps which send inaccurate market signals are actually decreasing supply= =20 and increasing demand thus worsening an already dire situation.=20 FERC has been publicly dedicated to an open market from the beginning of t= he=20 California power crisis. We encourage FERC to reexamine these price caps an= d=20 continue that dedication said Joe Bob Perkins president and chief=20 operating officer Reliant Energy Wholesale Group. Reliant is committed to= =20 helping keep the lights on in California this summer and wants to ensure th= at=20 if caps must remain part of the picture they actually help increase supply= =20 and fix the problem.=20 Although the price caps were first imposed less than a week ago they have= =20 already begun to damage the market by decreasing supply. The price caps are= =20 creating a myriad of problems:=20 -- Creates Misleading Signals - The price cap methodology is misleading=20 the public on the actual cost of power. Reported dispatch costs in=20 Southern California during emergencies is far below what the actual=20 financial settlements will be under the FERC's final market mitigation=20 order. This confusion results from the proxy price used for=20 dispatch utilizing an extremely distorted blended fuel cost index.=20 This index averages gas costs in northern and southern parts of the=20 state an impossibility in the actual market. This authorizes the=20 California Independent System Operator (ISO) to require that=20 generators dispatch power at reported market clearing prices well=20 below actual cost when back-up generation capacity begins to dip below=20 7.5 percent.=20 -- Depletes Power from Peaking Plants - The price caps distort dispatch=20 signals on peaking plants which in some cases may be run only a few=20 days of the year because of emission regulations. The current FERC=20 price controls encourage the ISO to purchase power from emergency=20 peaking plants before it is really needed even in the absence of a=20 stage three emergency. This depletes supplies that will by law run=20 out when blackout season intensifies later this summer. This power=20 from peaking units should only be purchased when blackouts are=20 imminent -- not in stage one or two emergencies.=20 -- Eliminates Price Signals for Retail Customers - Price caps remove=20 price signals for retail customers. Customers particularly=20 industrial companies which should be encouraged to curtail during=20 shortages are not encouraged to conserve power when dispatched price=20 caps keep prices below the actual cost to produce electricity.=20 -- Discourages Supply from Out-of-State - Suppliers outside of=20 California who are under no legal obligation to dispatch power during=20 an emergency in the state are not encouraged to increase available=20 production when reported market clearing prices are below their cost=20 to produce. During times of emergencies utilities across the Western=20 region are not likely to take on additional risks and costs if they=20 don't believe they will be fully compensated - a situation the current=20 price caps create.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Reliant Energy=20 CONTACT: Maxine Enciso of Ketchum Public Relations Los Angeles=20 310-444-1303 for Reliant Energy or media Richard Wheatley of Reliant=20 Energy 713-207-5881=20 Photo: NewsCom: AP=20 Archive: http://photoarchive.ap.org PRN Photo Desk 888-776-6555 or=20 212-782-2840=20 Company News On-Call: or fax=20 800-758-5804 ext. 419090=20 Web site: http://www.reliantenergy.com (REI)=20 By Kathleen McFall kmcfall@ftenergy.com President George W. Bush's energy package encourages the use of biomass fue= ls=20 for both transportation purposes and electricity generation. They can=20 provide a reliable source of energy at a stable price and they can also=20 generate income for farmers landowners and others who harness them his= =20 administration's report said.=20 Despite this warm and fuzzy language however the administration offered n= o=20 tangible funding for the fledgling biofuels industry=01*other than an exten= sion=20 of an existing ethanol tax credit that was not due to expire until 2007=01*= a=20 significant disappointment and surprise to advocates of renewable=20 transportation fuels. The report did recommend expanding tax credits for biomass energy projects = to=20 include forest-related and agriculture fuel sources and threw its weighty= =20 support at a new credit for electricity produced from biomass co-fired with= =20 coal. These recommendations are already included in the president's 2002=20 budget.=20 We are pleased that the administration included expansion of the biomass t= ax=20 credit and hope that with congressional leadership we will see this=20 expanded provision signed into law this year said Katherine Hamilton=20 co-director of the American Bioenergy Association (ABA).=20 Unlike other portions of the recommended energy policy biomass energy=20 probably will not suffer under the recent change in Senate composition giv= en=20 Senate Majority Leader Tom Daschle's (D-S.D.) agricultural constituency and= =20 his previous support of the biofuels industry.=20 According to the National Energy Policy Development report biomass account= s=20 for about 76% of non-hydropower renewable electricity generation=20 representing a total of about 1.6% of total U.S. electricity supply.=20 Biopower advocates however envision an even greater market penetration in= =20 the coming decades and point to its environmental and ancillary advantages.= =20 For example given that biomass combustion can be carbon dioxide-neutral (i= f=20 the growth and use cycle is managed sustainably) environmental groups=20 support an expanded role. Farmers with marginal lands that could grow bioma= ss=20 fuel could enjoy economic benefits. With large amounts of wood residue the= =20 forest industry also stands to benefit from wider use of wood as a power=20 source.=20 Renewable energy offers a particular advantage to the lumber and paper=20 industry and many analysts project that the industry may soon become a net= =20 seller of electricity.=20 In the lumber and paper industries wood scraps are sometimes directly fed= =20 into boilers to produce steam for their manufacturing processes or to heat= =20 their buildings. For that reason renewable energy offers a particular=20 advantage to the lumber and paper industry and many analysts project that= =20 the industry may soon become a net seller of electricity said the energy= =20 policy report.=20 Co-firing with coal Biomass=01*usually wood or wood residue=01*has traditionally been burned di= rectly=20 in the industrial sector for heat or on-site electricity generation.=20 According to the U.S. Department of Energy (DOE) the existing 10 GW of=20 installed capacity are based on this direct-combustion technology.=20 For utilities and power-generating companies with coal-fired capacity=20 however biomass co-firing may represent one of the least-cost renewable=20 energy options said the DOE. The process involves blending different=20 materials in varying amounts with coal.=20 Not only does mixing biomass with coal reduce emissions it is likely to be= =20 cost-effective. Southern Co. estimates that a biomass plant alone could=20 generate power depending on its location at 4 to 11 cents/kWh. Given that= =20 the lower range of this corresponds to coal generation costs there are=20 clearly circumstances where biomass-coal co-firing would be economically=20 attractive today. Plus the environmental public relations benefit for=20 utilities with coal-fired capacity would be valuable.=20 Domestic biomass generation capacity could reach 20-30 GW by the year 2020 = by=20 co-firing at existing U.S. coal-fired power plants.=20 According to a recent report prepared by five National Laboratories domest= ic=20 biomass generation capacity could reach 20-30 GW by the year 2020 by=20 co-firing at existing U.S. coal-fired power plants.=20 A recent report by the United Nations Intergovernmental Panel for Climate= =20 Change (IPCC) also cites the potential of coal co-firing with biomass. The= =20 IPCC report concludes that co-firing in coal boilers results in the lowest= =20 cost and least technical risk of the examined approaches for biomass=20 conversion to electricity.=20 Working out the technical kinks Already said the DOE six power plants in the U.S. are currently co-firing= =20 coal and wood residue products on a regular basis. Another 10 plants have= =20 successfully tested co-firing over the last decade and at least six more= =20 plants are now conducting or planning tests.=20 For example Southern Co. is working with DOE the Southern Research=20 Institute and the Electric Power Research Institute to study ways to grow a= nd=20 harvest switchgrass to blend with coal as a fuel for power generation.=20 Ideally suited for the southeastern U.S. switchgrass is a rugged grass tha= t=20 can be grown on marginal agricultural land. Reaching heights of up to 12=20 feet it requires little fertilization and herbicide and can be harvested= =20 twice a year.=20 Harvesting methods co-milling of switchgrass and pulverized coal=20 pilot-scale co-firing tests and a full-scale demonstration of co-firing at= =20 Alabama Power Co.'s Plant Gadsden are part of Southern Co.'s collaborative= =20 project.=20 The U.S. Agriculture Department is also taking a role in exploring the=20 potential of biomass and coal co-firing as a means to give farmers new=20 markets especially for currently idle land. The agency recently authorized= =20 funding for three co-firing demonstration projects.=20 In Iowa the Chariton Valley Biomass Project is a cooperative effort to=20 develop warm and cool season grasses (such as switchgrass) to co-fire with= =20 coal at Alliant Energy's Ottumwa Generating Station. The project is designe= d=20 to generate a sustained supply of 35 MW of biomass energy. Eventually the= =20 grass could substitute for as much as 5% of the coal currently burned at th= e=20 plant.=20 In addition to reducing coal emissions the Chariton Valley Biomass Project= =20 will support the local farm economy.=20 In addition to reducing coal emissions the project will support the local= =20 farm economy because the grass and trees will come from acreage taken out o= f=20 production under the Agriculture Department's Conservation Reserve Program= =20 (CRP). CRP land is generally marginal land that the government subsidizes= =20 farmers to leave idle to both prevent erosion and protect commodity prices= =20 from product surpluses.=20 The Pennsylvania Switchgrass Energy and Conservation Project will produce= =20 switchgrass on CRP land for sale to a local cooperative's coal-fired=20 fluid-bed combustors.=20 In New York the Agriculture Department project will fund willow biomass=20 crops and switchgrass on CRP acreage in the central and western part of the= =20 state. The primary markets for the willow biomass are two coal-burning powe= r=20 plants and a small university central heating facility.=20 Land conflicts transportation may be obstacles As these pilot projects illustrate biomass conversion efforts may have the= =20 most significant potential in rural areas. Since biomass is widely=20 distributed it has good potential to provide rural areas with a renewable= =20 source of energy. The challenge is to provide =01( conversion and delivery = of=20 bioenergy to the marketplace in the form of modern and competitive energy= =20 sources said the IPCC report.=20 A potential drawback to co-firing is transportation. Transportation of=20 wood-based energy products is more costly per unit of energy than coal f= or=20 example and most analysts believe it will prove most economical to site=20 generation plants near biomass sources.=20 The generating plant or biorefinery must be located near to the resource t= o=20 minimize transport costs of the low-energy-density biomass as well as to=20 minimize impacts on air and water use the IPCC report said. However note= s=20 the report's authors economies of scale may be significant enough to offse= t=20 the transport costs involved.=20 A potential drawback over the long term however for biomass conversion is= =20 land use conflicts. The IPCC report notes that by 2100 the global land=20 requirement to feed the growing world population will increase substantiall= y.=20 Up until this time there may well be sufficient land to supply all demands= =20 for food fibre and energy but at some stage after that land-use conflict= s=20 could arise and before that competition for water and irrigation may be a= =20 constraint.=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Here it is What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Important - CPUC Motion - Confidential Attorney Client Privil ege and Work Product Body:: I just spoke with Mary to make sure we have the same information. Here are the facts we have so far. On November 4th the CPUC filed a motion with FERC to adopt the form of protective order that the CPUC entered to compel the production of documents and to shorten time to answer. According to Exhibit B (read to me by Nancy Pickover at Bracewell) the following CPUC moved against the following entities: AES Williams Duke Dynegy Reliant and Southern. Enron entities were NOT named in exhibit B. This is not to say that we could not be easily added to the group. While the motion reads as if the CPUC was moving against everybody in fact in footnote 2 they state they are only moving against the entities named in Exhibit B. We will have Exhibit B in hand first thing tomorrow via FEDEX to confirm this. To repeat Enron is not named yet. Thanks Gary What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: October London meeting Body:: Attached is a draft of the Agenda we discussed. Irwin - I show Joskow on here but he has already declined (his wife is having surgery right before our meeting date). We may want to consider someone like Seabron Adamson (Frontier Economics) or perhaps someone else. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: call to Sen Kinder Body:: Nice work Kerry and Barb. I think we should do the follow up work on setting a follow up meeting with the Senator. Ken left it open whether he would be available when the Sen is in Houston so we have made no commitment in that regard. Janine Migden 04/27/2001 08:32 AM To: Steven J Kean/NA/Enron@Enron cc: James D Steffes/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Susan M Landwehr/NA/Enron@Enron Kerry Stroup/NA/Enron@Enron Barbara A Hueter/NA/Enron@Enron Subject: Re: call to Sen Kinder Thanks Steve. That's great news. Just as an FYI the memo that Ken worked from was prepared by Kerry Stroup and Barbara Hueter who are the leads on Missouri. As a follow-up will Sen. Kinder be contacting Ken Lay directly or should Kerry and Barbara contact Sen. Kinder's office as the date gets closer to make arrangements? Please advise. Thanks Janine Steven J Kean 04/26/2001 08:07 PM To: Susan M Landwehr/NA/Enron@Enron Janine Migden/NA/Enron@Enron cc: Richard Shapiro/NA/Enron@Enron James D Steffes/NA/Enron@Enron Subject: call to Sen Kinder Ken talked to Sen Kinder. He made the points you had prepared. Kinder agreed to shelve the legislation for this session. He said he had been hearing from several others including Proctor and Gamble (which has a big facility in his district) that the legislation was not going to help competition develop in the state. He expressed willingness to work with us on a better package and also expressed interest in coming to Enron's offices. He is going to be in San Antonio in August and would like to come to Houston around that time. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Cal PUC Subpoenas - confidential attorney client communicatio n Body:: Mike Richard and Gary: What I was suggesting was that we would produce the limited items that we are proposing under the terms of the existing protective order (which are inadequate but we are not giving up any of the crown jewels at this point) while conditioning our production on two points first that we reserve the right to seek stronger protection in the order (a la Williams' motion) for any subsequent materials we do agree to produce or which are compelled to be produced and two that the materials we are currently producing which are entitled to confidentiality (the trading data at a minimum) shall be subject to the most stringent protective order which the Commission issues in this proceeding i.e. we get the benefit of any additional protections Williams can secure. I only suggest this so we can stay out of the limelight by not being one of the bad guy generators who are actively taking on the protective order when we know that at least four generators are producing nothing until their motion is resolved and one marketer (Coral/Shell Energy) has refused to produce transactional data and has objected to most of the document request. I have also recently learned that Calpine has gotten an extension until Oct. 13 and will try to delay and hold off producing much data. I will get getting a copy of Coral's objections to the commission shortly. Mike Day What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: REMOVE Body:: What do you think? If you think this would be useful go ahead and order it. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential for Dan Watkiss Body:: Jim If you are able to provide this to Dan for the meeting I would appreciate it. He may not want to circulate it to the group. It is intended as a work product for attorney. This e-mail and the attachments were prepared at the request of counsel. <> Jan Paul Acton Vice President Charles River Associates 1201 F St. NW Suite 700 Washington DC 20004-1204 Voice: (202) 662 3902 Fax: (202) 662 3910 ***** This electronic message contains information from the consulting firm of Charles River Associates Inc. which may be confidential or privileged. The information is intended for the use of the individual or entity named above. If you are not the intended recipient be aware that any disclosure copying distribution or use of the contents of this information is prohibited. If you have received this electronic transmission in error please notify us by telephone (617 425-3582) or by e-mail (postmaster@crai.com) immediately. ***** - NOTES FOR DISCUSSION.doc What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: New Computer for Handling Stock Awards Body:: Do what you need to do the system has to work. The only question I have is: why doesn't IT just take care of this without a charge? This is not an extraordinary item or special request. This ought to be something IT simply takes care of without us having to get involved or pay extra. Am I missing something? From: Aaron Brown/ENRON@enronXgate on 04/16/2001 09:41 AM To: Steven J Kean/NA/Enron@Enron Mary Joyce/ENRON@enronXgate cc: Subject: New Computer for Handling Stock Awards Steve The IT group put it like this...Justification: Current Server is PL1850 and has reached it's capacity and is non-redundant. That means that our current system: (1) has a slow processor (2) is nearly out of memory for stock award administration (3) doesn't have a real-time back up in case the hard drives fails (4) needs to be upgraded The IT group has quoted about $19000 for a new system that brings this server up to Enron's current server standards and takes care of the above issues. Let me know if this expense is a problem and whether you need to be involved with these types of decisions in the future. Thanks Aaron What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Status of Discussions on Electricity Legislation -- No Agreement Reached Body:: Once again today I participated in the discussions on possible electricity legislation held in the offices of Majority Whip Tom DeLay with other interested parties including industry segments public power and state regulators. The other congressional participants were staff to Reps. Steve Largent and Chip Pickering. After meeting all week (except Wednesday) the group was unable to reach an agreement or even a provisional consensus on what could be placed in an electricity title that could be added to the comprehensive energy package that the House Energy and Commerce Committee will begin to process next week. Congressional staff will report to their bosses on the status of the discussions as of this afternoon and from there the Members will determine whether to proceed further. There is a general perception that committee leaders will elect NOT to take up electricty legislation at this time and in the context of the broader package in the absence of broadly supported legislation. In the end the discussions did not bear fruit because divisions remained over the usual issues and along most of the usual fault lines. As the drafts progressed during the week we succeeded in deleting the original language that would have had Congress weigh into the bundled/unbundled and federa/state jurisdictional rules at the very time that likely adverse action in Congress could in turn adversely impact the Supreme Court case. A last minute attempt was made by the congressional staff to stitch together a minimalist electricity title that would have included reliability (with the understanding that the NERC discussions could produce modifications more to our liking) PUHCA repeal PURPA reform interconnection language and federal siting. However in each instance there were one more politically relevant interest groups not willing to go along. Cong. DeLay's staff also tried to link PUHCA repeal to those who had joined an RTO. There was also an attempt to strip it down to reliability interconnection and siting (eminent domain) -- but again there was either disagreement on the details or objection from those who favorite subject was left out of the minimalist package. There was one rather interesting discussion when the public power folks floated language on market power that included a sentence that would have made the filed rate doctrine inapplicable to antitrust challenges to market rates. Needless to say I strongly objected as did EPSA and others. As noted the lack of an agreement reduces our exposure when the mark up occurs. In the absence of an electricity title refund price control and other issues should not be germane to the package that the subcommittee will take up on Tuesday and the full committee next Friday. That package will have five issues addressed: conservation clean coal hyrdo nuclear and reformulated gasoline. Details to follow once legislative language is released. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Politics and Enron Body:: The plan was to hit the issue twice -- once in the short format of Ebiz and at greater length in the longer format of the October issue of Enron Business. Please let Paul know. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Jamaica forecast for JMD and inflation, dated 6/25/01 Body:: Gwyn Thanks for this msg and other updates. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Daily Update/ Legislative activity - 08/24/00 Body:: I agree that we should not be opposing rate caps for small customers and schools but I think we should be pounding on the fact that market participants have been putting offers in front of sdge and that allowing the market to provide this solution is superior to legislated caps that require the creation of huge deferrals (and more problems in the future). Can we make that argument work? Mona L Petrochko 08/24/2000 09:45 PM To: Bruno Gaillard/SFO/EES@EES cc: West GA Edward Hamb/HOU/EES@EES Jennifer Rudolph/HOU/EES@EES Chris Hendrix/HOU/EES@EES Greg Cordell/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Martin Wenzel/SFO/HOU/EES@EES Douglas Condon/SFO/EES@EES James M Wood/HOU/EES@EES Gary Mirich/HOU/EES@EES Dennis Benevides/HOU/EES@EES Roger Yang/SFO/EES@EES David Parquet@ECT mday@gmssr.com Paul Kaufman/PDX/ECT@ECT Marcie Milner/Corp/Enron@ENRON Mary Hain@Enron Harry Kingerski/HOU/EES@EES James D Steffes/HOU/EES@EES Richard Shapiro/HOU/EES@EES Peggy Mahoney/HOU/EES@EES Karen Denne@Enron Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Tim Belden/HOU/ECT@ECT Subject: Re: Daily Update/ Legislative activity - 08/24/00 I attended Cmmr. Wood's two-day hearing on Wholesale Markets which concluded today (8/24) in San Diego. Three Commissioner's were present (Wood Lynch and Neeper) with Duque and Bilas participating by phone. Administrative Law Judge Wetzel was present and a transcript was taken. The quasi-legislative hearing was the beginning of a record developed for the investigation into the workings of wholesale/retail markets. This session focused on Wholesale markets. There will be subsequent sessions on retail issues market structure and other related issues in the future. My conclusion from this session is that Wood is looking for support for increasing regulatory intervention in the market. Dan Larcamp Director of the Office of markets Tariffs and Rates FERC was present. He relayed FERC's concern of this matter and a desire to hold hearings in San Diego. He also relayed that Hoecker held a press conference announcing the opening of a 206 investigative proceeding into the operation of the wholesale markets in California which carried with it refund authority. The format of the hearing was to respond to pre-filed questions developed by Wood/Lynch. Each member of the panel would respond to the questions and any questions posed by the Commissioners the Judge or the CPUC Attorney. No questions were posed by members of the audience. Yesterday's panel of academics were comprised of: 1. Dr. Timothy Duane-UC Berkley 2. Dr. William Hogan-Harvard 3. Dr. Frank Wolak-Stanford (ISO Market Surveillance Committee) 4. David Marcus-Energy Consultant for the Coaltion of Utility Employees 5. Dr. Gene Coyle 6. Dr. Jean-Michel Glachant Universite Paris I Pantheon Sorbonne The panel was asked to speak as individuals and not on behalf of any institutions they may represent. While the purpose of the panel seemed to be to determine that market power was being exercised and that prices were too high and therefore not just and reasonable the panelist stopped short of blaming generators and market participants in behaving illegally. The concensus generally was that market power did exist at various times but the mere existence did not constitute bad behavior. None with the exception of Dr. Wolak who is in the process of doing a study using recent data as part of his role for the Market Surveillance Committee had done a study. There was some discussion though not much of the monopsony power of the utilities. I think ultimately the group conceded that scarcity of supply amplified concerns about the exercise of market power as even the increase in gas costs did not fully explain the recent spikes. Wolak believes that encourage utilities to enter into forward purchases will reduce the exercise of real-time market power. Hogan seemed to be there with Sempra's interests in mind. He continued to promote expansion of the ISO's abilities to dispatch load as well as maintain system reliability. There was alot of discussion about forward purchase ability for utilities so as to be less subject to volatile market prices. The concerns were also discussed about the appropriateness of a distribution utility making purchasing decisions on behalf of its customers. This included discussion of separation of these functions and the default provider role. Most everyone agreed that rolling back to a regulated market was not feasible without raising other major and serious concerns however there seemed to be support for some interim measures where cost-of-service regulation may be a good idea and that was during peak periods. All agreed that a demand response and price signals are important in the long-run although not to the extent currently experienced in San Diego. Today's panel included representatives from SDG&E SCE and PG&E TURN UCAN and ORA. While yesterday's panel maintained objectivity as to whether or not generators were exercising market power to the detriment of the system today's panel made no bones about the generators being to blame. SCE/PG&E indicated their need for relief for recovery of market costs in excess of the rate freeze. SDG&E was still on the hot seat for their inaction in hedging any of their supply. SDG&E brought up their failed PBR proposal and ORA and UCAN thought that that may be one way to incent the utility to be more responsible with their purchases. UCAN discussed the Governor's direction and the potential for putting rate caps into affect for residential and small commercial. He mentioned that C&I customers are experience difficulties as well. TURN raised the need for cost-based bid caps and cost-based peaking contracts. Mike Florio TURN urged against any further divestitute of assets and alleged market concentration on those assets that had been divested. In fact TURN urged the Commission to seek legislation to clarify the Commission's authority to order retention of assets. Neeper urged that part of the solution should be changing the current requirement to use the PX as the only authorized exchange although TURN disagreed. Bruno Gaillard 08/24/2000 06:09 PM To: SF Directors Edward Hamb/HOU/EES@EES Jennifer Rudolph/HOU/EES@EES Chris Hendrix/HOU/EES@EES Greg Cordell/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Martin Wenzel/SFO/HOU/EES@EES Douglas Condon/SFO/EES@EES James M Wood/HOU/EES@EES Gary Mirich/HOU/EES@EES Dennis Benevides/HOU/EES@EES Roger Yang/SFO/EES@EES David Parquet@ECT mday@gmssr.com Paul Kaufman/PDX/ECT@ECT Marcie Milner/Corp/Enron@ENRON Mary Hain@Enron Harry Kingerski/HOU/EES@EES James D Steffes/HOU/EES@EES Richard Shapiro/HOU/EES@EES Peggy Mahoney/HOU/EES@EES Karen Denne@Enron Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Tim Belden/HOU/ECT@ECT cc: Subject: Daily Update/ Legislative activity - 08/24/00 Siting related bills 1. Good new - The Williamson Act passed the Senate 34-1 It should be heard at the assembly Saturday or Monday if it is not redirected to a Committee hearing. 2. There was a long meeting with Ducheny with regards to AB 970. The enviro's boycotted they want to draft a bill with Keeley. Labor was obstructionist - they wanted to gut all the expediting siting language with regards to all facilities except for the peaking plants. Rate Cap related bills 1. The Edison Language on Rate Stabilization may not go anywhere. Edison has not found an author because of the efforts of Enron and others lobbying against it. Furthermore there are signs that Gov. Davis opposes it. 2. The Governor's office has issued a proposed language for a rate cap bill. The language however is not available as of yet. It may be released today or tomorrow. SDG&E has shown concerns over the content of the bill. They seem to think that it is worse than initially proposed by the Governor in his press release. The bill includes retroactive rate caps through 6/1/00. The rate cap could reflect Wood's rate cap proposal (6.5 cts cap on the energy component The bill does not specify who or how the costs associated with the cap will be recovered. (The reasoning is that UDCs will be more cautious in their procurement if there is uncertainty on who is responsible for the costs.) All of this is speculative. We hope to see the actual language soon. 3. Enron has been working with the Republican leadership to promote a rate cap proposal similar to the amended language we have proposed for AB2290. The bill focuses only on SDG&E customers and our major principals are the following. The Interim Rate Cap should be limited to residential and small commercial customers plus specific institutions that have a significant public role such as schools and hospitals. The Interim Rate Cap should be limited to the period ending December 31 2001. The Interim Rate Cap must be structured so that any undercollection is eventually recovered from the same customers who benefit from the lower rates provided by the rate cap. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: o:\Research access list Body:: Sandeep This is the list of the groups that have access to Research directory. Martin compiled this list. Please review it and let's talk about the recommendations regarding changes and restrictions we have to make. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Data request Body:: Eliz- can you handle? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: confidential employee information Body:: Oxley asked that I send you a few bullets on Tom Martin. Please see below and let me know if you need further info. Feedback from two exit interviews from voluntary terminations in regard to Tom is as follows: was treated as inferior by my manager was lied to and insulted by my supervisor Tom berates employees in front of others and blames underlings for his mistakes. Additionally he second guessed every position I put on sold me out of positions (which turned out good) and used all our allocated VAR for his own benefit. Tom has a reputation for not representing employees well in the end of year review process. I found this to be the case as well. Tom is difficult to communicate with Additionally we had an incident w/ an employee when Tom offered her an employment agreement. She felt that she was being forced to sign the agreement When she declined the agreement and turned in resignation she said that Tom said he would make it difficult for her to leave She said that she felt threatened by Tom Her boy friend called Tom and threatened him As a result Legal asked Tom not to have further contact with the employee. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - May 2001 HR At A Glance Body:: Attached is the May 2001 At A Glance report. A couple of additions this month which include a section on Capital Expenditures with Pay Backs and some analysis of the recent new hire survey that we set up. Please call if you have any questions. DCL What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: How should this be handled - rather touchy Body:: Is this someone in the analyst/associate program? ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: novak column Body:: More indications that the power angle may be fruitful What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fenosa and Enron to Invest $550 Million in Dominican Republic Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: I just checked with Jeff and Ken. They are both out of the office that day. Sorry it didn't work out. gilbert whitaker 03/06/2001 07:14 PM To: skean@enron.com cc: Subject: Steve - With respect to CK Prahalad's visit to Rice. As you know we are having a breakfast for the business community the morning of March 19 and he gives the Neuhas Lecture on Campus at 9:45 am. Following the lunch there is a lunch with Mrs. Neuhas the donor of the fund and faculty. That should be over by 1:15. He has a date from two to five at Enron with Yeager (Steve or Scott). He would like to meet with Ken or Jeff sometime that afternoon if at all possible. Thanks for your help. gil What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Tom DeLay CA Aug Dinner & Golf event Body:: Jeff I spoke to Joannie this afternoon and asked for your e-mail to send this invitation. Here is the initial information on the event. We are expecting additional members of Congress to attend both events. If you have any questions or comment please let me know. I have attached a word doc. as well: Tom DeLay / ARMPAC Guest Speaker - David Horowitz Four Seasons Aviara - Dinner & Golf Tournament The event will take place: Wednesday August 15 Four Seasons Aviara (Northern San Diego CA) Golf Lunch will start at 11am Tee times at 12:15pm An informal reception afterwards Limited to 40 people Cost is $5k per person Dinner Reception 6 to 6:45pm Dinner 7 to 8:30pm Speakers Tom DeLay and David Horowitz $1500 per person $2500 per couple There are four levels of sponsorship: $100K $50k $25k and $15k. Contribution levels will also transfer from the dinner and/or Golf Tournament to the ARMPAC contributor sponsorship program. Bill Gowan Election Day Consulting LLC 1947 Camino Vida Roble suite 104 Carlsbad CA 92009 760 929.1203 electiondayconsulting.com - Aug 15 Golf dinner.doc What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: LOGISTICAL INFORMATION FOR THE MAY 22-23, 2001 FORUM Body:: meeting folder ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Protecting Confidential Information: New European Restricted List Procedure Body:: As you know we are now launching EnronCredit.com which will involve credit derivatives trading in Europe and North America both on Enron Online and off-line. This will involve quoting prices for buying and selling bankruptcy protection in respect of reference entities many of whom are our counterparties in a variety of different commercial and financial contexts. This exciting cocktail of credit derivatives and Enron Online raises significant novel legal risks for Enron. Probably the most significant risk would arise in a situation where Enron has confidential information about a reference entity and wrongfully uses that information in pricing the credit derivative on that entity. This could well result in legal proceeding against Enron. In practice an allegation of misuse of confidential information can be very difficult indeed to defend without adequate procedures in place to safeguard that information. In fact Enron's credit trading will rely strictly on publicly available financial information and will not involve the use of confidential information unless the reference entity has specifically consented. Nevertheless to avoid the appearance of impropriety we are taking additional steps to consider confidentiality agreements we have in place with potential reference entities before deciding whether or not we will quote prices on such entities. Against this background is the ever-present risk of insider dealing. This crime - which carries a maximum prison sentence of 7 years and an unlimited fine - is committed where a person (or member of their family etc) deals in the securities (shares bonds or derivatives on them) of a listed company on the basis of unpublished (confidential) price-sensitive information. We do not expect at this time to deal in publicly traded bonds as part of EnronCredit.com but insider dealing is relevant to the conduct of Enron staff and could affect other parts of our business. In addition SFA rules require the safeguarding of confidential information the misuse of which is a serious disciplinary matter. In order to ensure the success of this new business and that confidential information is not misused either by Enron or its staff we are now introducing new policies and procedures (attached) which include a simple Restricted List procedure. In essence they require you - to take prudent steps to safeguard confidential information within Enron to notify Michael Brown Mark Elliott or myself if you become aware of confidential or sensitive information (or circumstances) about a counterparty which you think might make it appropriate for that counterparty to be placed on the Restricted List. To make life easier numerous examples of the types of information which might be relevant are set out in the attached procedures. Please familiarise yourself and anyone else in your group you think appropriate with these procedures. As you will see you are not expected to make difficult determinations about whether an entity should or should not be added to the Restricted List just to let us know if you think there is a possibility that it should be added. We will also provide quick briefing sessions to ensure that each of you is comfortable with these new procedures. Many thanks for your co-operation. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Several employees have asked about the exercise policy on stock options. Specifically they want to know what the exercise policy is on i) termination eg as a result of the prc process ii) voluntary departure iii) retirement or iv)resignation and to what extent do the rules vary across plans: i) AESOP LTIP deferred bonus etc. The main focus is on the length of time to exercise. I am concerned that there may be some odd incentives in the structure -- eg are severed employees allowed more time to exercise than employees who just leave voluntarily ( ie if you want to have a full three years to exercise options are you better off becoming a performance issue and getting severed than you would be if you simply left the company? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fw: Confidential - Decision tree on projects Body:: Fyi What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Some Background on California Gas Price Spikes--The Other Side of the Story Body:: Could you coordinate with Cindy Stark on the meeting with Massey in a couple of weeks? Stan has asked me if I would like to attend. I would but don't know when exactly it is scheduled for. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ken Lays email to Sen. Brulte Body:: nan What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CI at EBS Body:: Thanks for the message. Rita Hartfield@ENRON COMMUNICATIONS 07/17/2000 02:52 PM To: Steven J Kean/HOU/EES@EES cc: Anthony Mends/Enron Communications@Enron Communications Subject: CI at EBS Steve I have heard through the grapevine that Amy Oberg has relayed to you that EBS will not be doing competitive intelligence and that you were dismayed to hear this. Amy is correct in the fact that EBS is not likely to buy the software Strategy that provides a strategic top-down focus on competitive intelligence. However EBS is doing tactical competitive analysis and market research. We are providing the business units with the information that they need to make intelligent decisions at the business unit level. Amy's view is that competitive intelligence (CI) belongs at the corporate level and that CI should drive the strategic direction of the company. You and I both know this is not the way Enron operates. I hope this e:mail does not sound negative but I did want you to know that EBS is providing information and intelligence to its business units -- it is just not in the context that Amy thinks it should be in. If you have any questions please let me know. Rita Hartfield Phone: 713-853-5854 Cell: 713-304-5428 Fax: 713-646-8861 rita_hartfield@enron.net What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Board presentations Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CONFIDENTIAL - Residential in CA Body:: Jim / Karen - Thank you. We are not going to pull the trigger to turn back these customers without a full review and the agreement of all appropriate teams at Enron. Thanks - Dan Karen Denne@ENRON 04/13/2001 12:30 PM To: James D Steffes/NA/Enron@Enron cc: Jeff Dasovich/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Sandra McCubbin/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Mark Palmer/Corp/Enron@ENRON Susan J Mara/NA/Enron@ENRON Peggy Mahoney/HOU/EES@EES Harry Kingerski/NA/Enron@Enron Dan Leff/HOU/EES@EES Subject: Re: CONFIDENTIAL - Residential in CA Before any decision is made I think we really need to weigh in with EES on the ramifications (both PR and legislative) of turning back 16000 residential customers. I strongly believe that the public hit we will take will be far greater than our actual out-of-pocket losses. We will be crucified by the public media consumer groups legislators governor attorney general etc. and this action will reaffirm our reputation of packing up and leaving when it's not in our interest. The impact of this action would be exacerbated since it is on the heels of UC/CSU. I would also argue that this hurts our national dereg efforts. If we're advocating that competition and choice benefits consumers and then we turn around and pull out of a market and abandon customers when we're not profiting we'll kill any chances we have of ever serving retail customers in California -- or in any other state. We look foolish advocating for direct access when we're not willing to serve our existing -- let alone future customers What about a preemptive strike that engages these 16000 customers to weigh in on direct access -- i.e. a letter that says Enron may be forced to cancel its contract -- call/write/send the enclosed postcard to your legislator and tell them you want to keep your right to choose your energy service provider. Our credibility is on the line. Before we take this action we need to be cognizant of all the long-range strategic implications and we need to seriously weigh the negative impact this will have on our corporate reputation on our legislative abilities and on our commercial success going forward. kd James D Steffes 04/12/2001 09:05 PM To: Jeff Dasovich/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Sandra McCubbin/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Mark Palmer/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON Susan J Mara/NA/Enron Peggy Mahoney/HOU/EES@EES Harry Kingerski/NA/Enron@Enron cc: Dan Leff/HOU/EES@EES Subject: CONFIDENTIAL - Residential in CA In the meeting today no decision was made about what to do with Enron's 16000 residential customers. Each of the contracts gives a basic 30 day out right to Enron. That being said I think that we have a short window to push for DA before any public action impacts us in Sacramento. I realize that the ultimate action (which I think is inevitable) makes it harder for our advocacy on DA but real $ are flowing out of the company. EES will give us notice when a decision is reached. Thanks Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meeting to discuss U of H Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: FYI What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Stuff Body:: Here it is What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL AND LEGALLY PRIVILEGED Body:: CONFIDENTIAL AND LEGALLY PRIVILEGED Vicki Many thanks for your assistance yesterday. Clinton Energy Management Services Inc. because it holds a current power marketing certificate is an entity which we would like to move to being a direct subsidiary of Enron Corp. to take effect today. This is considered to be an essential part of restructuring to meet our current and future needs. While the day to day control will remain where it is and all the efforts assign contracts and other work should progress as planned since the value to Enron Corp. is the power marketing certificate nothing should be done to jeopardize this. In addition we will be changing the charter and will need copies of the existing charter to effect those changes required. Please call me if you need to discuss this further. Kind regards Marcus What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: DRAFT - PRC Follow Up Memo Body:: Looks fine to me. Maureen - please keep on file From: Billy Lemmons/ENRON@enronXgate on 06/13/2001 07:08 AM To: Stanley Horton/ENRON@enronXgate Steven J Kean/NA/Enron@Enron cc: Ted C Bland/ENRON@enronXgate Teresa Bosien/ENRON@enronXgate Subject: DRAFT - PRC Follow Up Memo Stan and Steve Below is a short email that I suggest we send as a follow up to each PRC meeting. Please adjust as you feel appropriate and I'll ask Terry Bosien to provide your assistant with a list of attendees after each meeting for distribution. I'm traveling today but will be back in the office Thursday. If you'd like to discuss my asst Maxine (x33499) knows how to reach me or you can contact Ted or Terry. Regards Billy ___________________ Thank you for participating in the [EES] Analyst & Associate PRC meeting [last Friday]. The Western Hemisphere final PRC meeting for Analysts & Associates is set for July 18. The purpose of this meeting will be to review the collective ranking distributions and to discuss the performance of individuals in categories 1 and 5. A subset of those who participated in [Friday's] meeting will be selected to participate on July 18. After the July 18 meeting you will receive the ok to provide feedback to those you represented. If you are not the direct supervisor of those you represented it is critically important that you work with the supervisor to insure consistent and clear feedback and ownership of the ranking results. If you have any questions please feel free to contact Terry Bosien (x35230). Thank you again for your contributions to this important process. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Comp Committee Meeting - April 30th Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FCEL Body:: fyi - there has been some concern that this deal was being put together without Connecticut authorities knowing the full extent of our interest in FCEL. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Pension Reform Bill Body:: I think it's a good idea but we will need a different summary ... either limit the summary to a couple of key points or provide an explanation in layman's terms of the practical effect of each of the changes. Cindy Olson 04/26/2001 01:46 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Pension Reform Bill Steve what do you think????? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Peer Group Mapping Body:: I saw your e-mail response. Did it go to Oxley too? ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Eeegads... Body:: hey when are you scheduled to go in for your attitude labotomy? Paul Kaufman/ENRON@enronXgate 05/10/2001 01:51 PM To: Jeff Dasovich/NA/Enron@Enron Susan M Landwehr/NA/Enron@Enron cc: Subject: RE: Eeegads... I'll be there as will Sandi McCubbin. Are you interested in going? I thought not. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: I need to get the form to show compliance but I cannot get it online--I cannot remember all my passwords. Can you get this form for me? Thx. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: VACATION Body:: Kevin Enjoy your vacation. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Firsst article attached refers to the 1946 Nebraska case I mentioned to you= =20 in DC What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Folder to safely pass information to Arthur Andersen Body:: Please read and follow below: Thanks ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Report on POWER Conference Body:: I attended the U.C. Berkeley POWER (Program on Workable Energy Regulation) Conference on March 16. Here is a brief report on the relevant parts. Notably the Lieff Cabreser duo of Bill Bernstein and Barry Himmelstein were there listening carefully. The program consisted of the presentation of 8 economic studies followed by comments from two discussants followed by audience questions/comments. The following is a list of the papers and the discussants who presented with slides taken from the website of the U.C. Energy Institute You can click on this to see the slides in PDF format. The papers in green are not particularly relevant for our purposes and I won't say more about them beyond the note in brackets. The presenter's name is in bold. Bidding Asymmetries in Multi-Unit Auctions: Implications of Bid Function Equilibria in the British Spot Market for Electricity by Greg Crawford Duke University Joe Crespo NERA and Helen Tauchen University of North Carolina Pricing and Firm Conduct in California's Deregulated Electricity Market by Steve Puller UC Berkeley Discussion by Anjali Sheffrin California Independent System Operator Identification and Estimation of Cost Functions Using Observed Bid Data: An Application to Electricity Markets by Frank Wolak Stanford University [A paper about economic tools to study power markets.] Forward Contracts and the Curse of Market Power by Jeffrey Lien University of Maryland The Impact of Retail Rate Deregulation on Electricity Consumption in San Diego by James Bushnell and Erin Mansur UC Berkeley [This looks at whether consumption declined with price increases. Not much.] Consumption and Home Energy Costs: How Prevalent is the 'Heat or Eat' Decision? by Julie Berry Cullen University of Michigan Leora Friedberg University of Virginia and Catherin Wolfram UC Berkeley [A macro study on how consumers change overall spending patterns when they have to shell out more $$ for power.] A Quantitative Analysis of Pricing Behavior in California's Wholesale Electricity Market During Summer 2000 by Paul Joskow MIT and Edward Kahn Analysis Group Electricity Restructuring and the Cost of Pollution Reduction by Dallas Burtraw Karen Palmer Ranjit Bharvirkar and Anthony Paul Resources for the Future Before I discuss the specific papers and presenters one big picture point needs to be made. There was an unchallenged consensus at this conference that the generators have exercised market power to the tune of billions of dollars. The focus was on how and how much not whether. The good news is that I heard no evidence supporting any collusion theory the thought was that generators are making independent output and pricing decisions knowing they could influence the market price given the auction rules and the completely inelastic demand. On the other hand I would have to say that the economic work on the tacit collusion hypothesis in incomplete at best. The bad news is that the scale of potential overcharges is pretty staggering -- >$5 billion. The plaintiffs will be able to put together quite a damage study. Crespo Bidding Asymmetries in UK: This is a marginally relevant paper examining whether bidders in the UK electricity auction markets behaved in a leader-follower mode i.e. asymmetrically. Crespo's model shows that in a uniform price-setting auction with clearing price rules a price setter will emerge and take all prices above marginal cost. Thus above marginal cost pricing does not require coordination. Crespo (from NERA) appeared knowledgeable but is not an inspiring speaker. His paper also got roughed up a bit in the audience questioning segment. Puller Pricing and Firm Conduct in California's Deregulated Electricity Market: This is a very relevant paper as it tries to determine whether market power (presumably) exercised in California was static or dynamic meaning the product of individual firm decisionmaking (static) or tacit collusion (dynamic). The period studied was 4/98 to 12/99. Puller found evidence of static market power consistent with so-called Cournot pricing. This theory posits that in an oligopoly firms will take their rivals' observed price/output decisions as a given and decide how to maximize profitability given that behavior. He then tried to determine whether any dynamic games were occurring meaning a game where firms recognize their interdependence and try to follow a supergame trigger strategy in which firms try to induce favorable responses from rivals. It's quite complicated how he goes about this but fundamentally he tries to correlate observed output decisions with how a firm at that time might have expected a change in its behavior to affect its future share of the market. With this methodology Puller finds what he called weak evidence of forward-looking dynamic pricing for a brief time in 1998 but not otherwise. My impression was that the evidence for 1998 was very weak and the logic used to arrive at this conclusion was also weak. Puller then went at this a second time with a theory that attempts to determine what a firm's supply function would look like if it was exercising static and dynamic market power and then comparing this to an estimate of that firm's actual supply function. I found this even more speculative than the first theory. Nonetheless the results are basically the same: evidence of static but not dynamic market power. Puller took a lot of heat for the methodology of this paper during the questioning segment. He's not a dynamic speaker and does not appear to me to be a strong expert candidate. Anjali Sheffrin's commentary was very important. She is the Director of Market Analysis for CAISO. After general comments on Crespo and Puller she launched in to a discussion of whether their models explained the California experience. This turned out to be a preview of the CAISO FERC filing of last week in which they allege $5.5 billion in market power-related overcharges from May 200 to Feb. 2001. That filing and Sheffrin's report follow. They are essential reading. Sheffrin maintains that it was the absence of imports during this period that left the market power of the California generators unchecked. This permitted the in-state generators to engage in either economic or physical withholding of power. (Economic withholding is bidding a higher-than-needed supply curve physical withholding is cutting output at the plant.) Her study was intended to (1) Identify individual firms engaging in market power activity and (2) Analyze how each firms' actions set market clearing prices. She utilized full bidding data in CA ISO real time market for each hour between May and Nov 2000 defined and categorized bidding patterns and identified economic or physical withholding and then calculated bid-cost mark-up and a monopoly rent. She found what she claimed was strong evidence of both types of withholding but that economic withholding is the dominant bidding pattern used by the five large California generators. While Sheffrin's study does not name names it claims that most of the five in-state suppliers and many of the [16] large importers displayed bidding patterns which were consistent with the exercise of market power. Bernstein and Himmelstein were positively gleeful during this presentation. On the question of collusion Sheffrin's study is not terribly illuminating. She maintains that the dominant bidding pattern is consistent with two characteristics of a supply function equilibrium model of oligopolist pricing. I take that to mean Cournot which is a static non-collusive model. However when you read her study you'll see the picture is not entirely clear. Lien The Curse of Market Power: This is only marginally relevant for us as its thesis is that forward-looking supply contracts are better for both producers and society. Everyone seemed to agree -- and were confused why we needed a paper to prove it. Lien (U. Md.) is young and not expert material. Joskow and Kahn: (paper) (Kahn's slides). I'm sure many of you have already read this everyone should. Prepared for SoCal Edison it contends that 4 in-state generators (Reliant Dynegy AES/Williams and Southern/Mirant) exercised market power by withholding capacity during the summer or 2000. J&K use publicly available data on loads market prices and generation to (a) quantify combined effects of market fundamentals on market prices (b) calculate price gap (difference between actual prices and competitive market benchmarks) (c) account for quantify effects of ISO's ancillary services requirements and forced outages and then (d) calculate the output gap for high priced hours meaning the difference between observed and maximum profitable levels of generation. They conclude that prices were far in excess of the competitive benchmark and that the 4 in-state generators could have produced more power at competitive prices but chose not to. Hence market power was exercised. Kahn the Analysis Group economist who presented is a very colorful and rather undisciplined advocate of his position. He threw around allegations of conspiracy rather casually but mostly to be funny. I couldn't tell whether he believed his study proved that I don't think it even speaks to it. But Bernstein and Himmelstein applauded him when he finished grinning ear to ear. Severin Borenstein UC Berkeley and the conference director was supposed to comment on J&K but hardly did. He said that the generators would have been stupid not to exercise market power given the supply/demand conditions and the market rules and argued that permitting long term contracts and requiring real-time residential pricing were the solutions to all of this. Borenstein was the best expert material I saw at this conference and the fact he took a pass on the details of the J&K paper is puzzling to me. It made me wonder whether he already has a horse in this race or perhaps is trying to stay above it all. Hope this is useful. Regards Dan Daniel M. Wall Latham & Watkins 505 Montgomery Street Suite 1900 San Francisco CA 94111-2562 Direct: (415) 395-8240 Main: (415) 391-0600 Fax: (415) 395-8095 dan.wall@lw.com This email may contain material that is confidential privileged and/or attorney work product for the sole use of the intended recipient. Any review reliance or distribution by others or forwarding without express permission is strictly prohibited. If you are not the intended recipient please contact the sender and delete all copies. - 2001032214541122276.pdf.pdf - 2001032214585222924.pdf.pdf What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Department Meeting Body:: depelschen children's home dinner What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: IS TRADING AN INSIDERS GAME? Body:: Enclosed is an article in this morning's San Diego Union written by one of their reporters that I know. As indicated it focuses on Enron. Of particular interest are the comments by Senator Dunn which are at odds with his statements to the Sacramento lobbyists that he has no idea what Enron does. The information contained in this e-mail message and any accompanying documents is subject to the attorney-client privilege and/or the attorney work product rule and is confidential business information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient or representative of the recipient you are hereby notified that any dissemination of this communication is strictly prohibited. If you have received this communication in error please notify the Systems Administrator at admin@pkns.com and immediately delete this message from your system. Content-Transfer-Encoding: quoted-printable Date: Wed 06 Jun 2001 08:53:28 -0700 From: Cindy Frederick To: Michael Kirby Subject: IS TRADING AN INSIDER'S GAME? Mime-Version: 1.0 Content-Type: text/plain charset=us-ascii Content-Disposition: inline IS TRADING AN INSIDER'S GAME? Buying selling of electricity is a growth business but some say deck is stacked against consumers By Craig D. Rose STAFF WRITER June 6 2001 While Californians decry deregulation's failure to deliver a competitive market electricity wholesalers have quietly developed a vast and rapidly growing business of buying and selling power among themselves. The deals take place on high-tech trading floors in Houston and elsewhere around the country as well as on Internet-based trading systems. Some experts say this electricity trading is a key mechanism for raising consumer power prices yet it's largely unregulated. Electricity trading is like buying stock -- when you have ability to change the stock price said Frank Wolak a Stanford University economics professor and member of the state grid operator's market surveillance group. Energy companies say the buying and selling of contracts to deliver power provides risk management allowing plant owners to presell their electricity lock in prices and avoid fluctuations. The rough and tumble of the free market they add is the most efficient means of allocating a resource like electricity. But industry critics say trading is far from a competitive market paradigm. In their view it's a means of communication -- a way for energy insiders to collude and raise prices under the guise of competition. To be sure the trading arms of major energy companies have emerged as stars in an industry where profit surges of 300 percent or 400 percent are not uncommon. The transactions shrouded in secrecy can leave ownership of a critical commodity in unknown hands. Consider the case of power generated by AES Corp.'s California plants. In 1998 AES made a bold move. Immediately after purchasing power plants that gave it control of 10 percent of the state's electric generating capacity the company sold the output from its plants for the next 20 years to Williams Cos. Williams did not sit on this treasure trove of electrons. The Tulsa Okla. company soon sold 80 percent of what it bought. It is difficult to say who owns that power now. Some might be owned by Sempra Trading a sister company of SDG&E. Or some could be owned by Enron Corp. the nation's biggest electricity trader. A spokeswoman for Williams conceded that Williams itself may have repurchased some of the electricity it sold earlier. But trading companies closely guard their positions. This much can be said with certainty: Electricity that AES sold for less than 5 cents per kilowatt-hour to Williams changed hands perhaps 10 times in the wholesale market and emerged at times in recent months with a price tag for consumers that was 300 percent higher. Williams' trading profits increased by 523 percent in the first quarter this year. Advance sales All this buying and selling creates curious confluences. In their attempt to deflect criticism over high prices generating companies such as Duke Energy -- operator of the South Bay Power Plant in Chula and others in the state -- frequently note that they sell most of their electricity far in advance. But they acknowledge less often that their trading units may also be buying power which could boost the company's electricity inventory. Duke was the fourth biggest electricity trader last year and cited its trading activity as a prime contributor to its wholesale business profits which soared 324 percent in the first quarter to $348 million. It is a company's power traders who frequently direct plant operators to increase or decrease the generation of power in response to market conditions. Energy companies have little option but to turn to trading for profits. One of the better kept secrets of electrical deregulation and its promise of competition is that there is remarkably little competition in the production side of the business. For one thing electricity is a commodity power from one company is indistinguishable from that generated by others. More important nearly all modern plants generate power from turbines built by a handful of manufacturers. The result? Modern plants owned by different companies produce power at nearly identical cost. The cost of power produced by modern plants is all within a mil (one-thousandth of a dollar) said Michael Peevey an adviser to Gov. Gray Davis and former president of Southern California Edison. So the extraction of profit in the electricity business relies much more on trading. Traders' profits rise when prices are volatile -- plunging or even better rising sharply. Little regulation But despite the obvious temptation to manipulate the market the burgeoning electricity trading business has remained largely unregulated. The Federal Energy Regulatory Commission does require quarterly filings from energy traders but these often provide incomplete information or at least little that has been of concern to FERC. In fact although the trading of electricity grew more than a hundredfold from 1996 to 2000 FERC has taken no major enforcement action against a trader. After the onset of the California crisis last year FERC has acted once. That was against Williams which agreed to pay $8 million without admitting guilt to resolve an allegation that it withheld supply to pump up prices. FERC's record of enforcement in the area of power trading stands in contrast to a long list of enforcement actions within other markets taken by the Securities Exchange Commission and the Commodity Futures Trading Commission. FERC has recently added staff to its market oversight operations. But William Massey a FERC commissioner says the agency's effort is still inadequate. Electricity can be flipped stripped and chopped up Massey said. It's an extraordinarily complicated market. The sophisticated marketers and traders have simply moved past us. We're kind of horse and buggy in our approach and they're out there in rocket ships flying around ... The problem is that sophisticated traders don't necessarily produce reasonable prices. They produce profits. Before deregulation electricity trading was a low-key affair. Regulated utilities dealt power back and forth on a reciprocal basis to fill electricity shortfalls in their control areas. There was little trading for profit until the mid-1990s after federal legislation and FERC rulings opened the market. Major traders include large energy companies sister companies of California's major utilities and Wall Street firms. Market volatility In many ways the trading of power is similar to that of other commodities. But there are important differences. Because it cannot be stored and its use is so fundamental the price of electricity is the most volatile of all. When supplies are tight a single supplier can rapidly raise prices to budget-busting levels as evidenced by Duke Energy's recent admission that it charged California nearly $4000 for a megawatt-hour of power a quantity that probably sold hours earlier for one-tenth of that sum or less. Wolak the Stanford economist and state Sen. Joseph Dunn D-Garden Grove who is investigating the state power market say trading allows companies to collude under the guise of competition. Instead of wringing out lowest costs the wholesale trading market serves to raise prices they say. As I trade to you and you trade to me we communicate to each other what price we would like to get said Wolak. It's not collusive. It's just communicating price. Mark Palmer a spokesman for Enron the nation's biggest power trader said California's problem is not the result of trading. It's a result of shortages Palmer said. Underscoring its emphasis on trading Enron's new headquarters tower in downtown Houston rises from a six-story block of new trading floors including expanded space for electricity trading. Enron also pioneered trading in cyberspace and its Enron Online site claims to be the most active computer-based trading market. The Houston company argues that consumers won't fully benefit from power trading and deregulation until they have greater choice in choosing their power supplier. And the company says FERC has not done enough to open access to transmission lines which would allow traders to move power around the country. To that end Enron has lobbied hard for President Bush's plan for a national electricity grid. Palmer says the notion that the price of electricity rises each time it is traded is mistaken. The market is always looking for the real price of a commodity Palmer said. Dunn the California state senator says his investigation found a different function for trading. At a time when supply barely meets or falls short of demand he noted companies with electricity to sell have to worry only about how high to set their price. The trader is a pawn in the generator's game to drive up prices said Dunn. Trading develops a level of trust. You my alleged competitor will bid in the same patterns and I will respond not in a competitive pattern but in a complimentary pattern. The state senator said his investigation found evidence that on several days energy companies appeared to test their ability to drive prices up without being undercut by competitors. This ability to drive up prices without competitive consequence is a key test of market power the technical term for manipulation or price fixing. But Dunn also conceded that antitrust violations can be hard to prove in court. He suggested that even if the trading behavior falls short of antitrust violations it remains anti-competitive and devastating for the California economy. To Harry Trebing a utility industry expert and professor emeritus at Michigan State University wholesale electricity trading is reminiscent of what took place in the 1920s and early '30s. Back then utility companies created complex networks of holding companies that traded stock among themselves driving up prices in the process. Undoing that scheme was a focus of President Franklin Roosevelt's administration. Congress ended up barring national power companies and tightening regulation of utilities in an effort to counteract their tendency to create markets that work only for insiders. The broad goals of trading are the same Trebing said. The goal is to maximize profits through raising prices. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Governor Davis Power Grab Body:: per my voicemail ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: meeting Body:: ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Application for Financial Engineer Body:: Shriram We have suspended hiring for the next few months till we shall sort our physical space problem (we have no space left in our old building). Please feel free to contact me again in September. Vince Kaminski What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - April American Express Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Risk 2001 Australia Body:: Philip Frank's E-mail: wolak@zia.stanford.edu Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: Can you guys coordinate to make sure someone listens to this conference call each week. Tara from the fundamental group was recording these calls when they happened every day. Phillip ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: HP -- confidential internal document Body:: Matt: As GSS Business Development transitions the HP relationship for broadband to your team there are several issues I wanted to clarify in terms of how the relationship has been developed and who the contacts have been to date. Additionally I outlined the discussion points/action items from this morning's meeting you held with Jennifer Medcalf and myself. Per your request the HP presentation complete with a listing of HP's business partners was e-mailed to you this morning. HP contacts to date: Bill Lovejoy Western Gulf Area Sales Manager Houston TX #(713)-439-5587 (Gerry Cashiola's boss) Gerry Cashiola sales representative Houston TX #(713)-439-5555 (To date HP person coordinating the relationship--seeking a short term play) Greg Pyle Solution Control Manager Southeast Region Austin TX (#(512)-257-5735 (Pyle has been playing the business developer role but continues to defer leadership of the process to Gerry Cashiola) Daniel Morgridge Manager of Internet - E-Services long term alliances Austin TX #(512)-257-5736 (Interested in E-services/wireless longer term alliances) Bill Dwyer Chief Architect e-Services Solutions Cupertino CA #(408)-447-5240 (To date clearly the most knowledgeable person on HP's business propositions strong technical financial background to craft value propositions. Gerry Cashiola and Greg Pyle deferred to his judgement in the 11/16th meeting) Matt On November 10th GSS Business Development took HP through a tour of Enron's trading floor the gas control center and the peaking power plant unit center on the trading floor. This tour was one meeting amongst several held in October and November to provide HP a full overview of Enron's products and services and introduce them to appropriate contacts at Enron (EBS GSS buy side -- Peter Goebel). On November 16th GSS Business Development Patrick Tucker and Dale Clark outlined 3 possible EBS/HP focus areas -- connectivity storage and wireless. Three EBS action items were defined in that meeting: 1) HP was to provide an HP contact on connectivity (to date Gerry Cashiola has stalled on providing this). Sarah-Joy will continue to pursue this information and get a sense from Gerry Cashiola of what he means by short term opportunity. What is HP's time horizon for short term? 2) EBS and GSS/BD was to facilitate a conference call on Storage with Ravi to explore size and potential scope of opportunity (completed 12/8) 3) GSS/BD was to facilitate a conference call with Peter Goebel GSS IT Sourcing Portfolio Leader (set for 12/14) In conversations with you Jennifer Medcalf and myself this morning several decisions on forward-looking strategy with HP/EBS were confirmed: Gerry Cashiola has been unable to take control of the process. More importantly despite numerous visits to Enron in which he has had overviews of Enron's products and services met with Peter Goebel and his team on the GSS buy side and participated in an Experience Enron tour Gerry has been unable to define an HP business proposition. The coordination between Cashiola (short term initiative) Morgridge (long term 12-24 months) has remained unorganized. These initiatives need to be developed separately. Clearly the conversations with HP need to be elevated to a more senior level so EBS can work with HP decision makers who can move the relationship forward at a strategic level. As the relationship is developed at this strategic level shorter term opportunities will crop up along the way. But Gerry's short term plans will not be the focus of the EBS/HP relationship rather a by-product. To facilitate this process of elevating the relationship Jennifer Medcalf and I are following up with Bill Lovejoy and Greg Pyle. Lovejoy's boss is Dan Sytsma VP of HP's America's Central Region. In the conference call Thursday 12/14 with Peter Goebel and HP regarding wireless initiatives Peter will support the GSS/BD push for the HP/EBS initiative by reiterating the following two points: a) Enron is already an HP customer the onus is on HP to move forward on the process of building a strategic relationship (IBM and Lexmark are only some of the HP competitors who could push them out of the running) b) HP's ability to bring the right people to the table will influence HP's business relationship process with Enron Patrick Tucker and Dale Clark could build their relationship with Bill Dwyer Chief Architect e-Services Solutions (met at the meeting 11/16) in the near term. Perhaps plan a visit to Cupertino California to see Dwyer in person. We look forward to continuing close collaboration with your team on this and other opportunities. Sarah-Joy Hunter Enron Corporation Global Strategic Sourcing - Business Development #(713)-345-6541 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Schoenemann Resume Body:: Presly Greetings from London. I picked up your resume from here and forwarded it to our corporate recruiter. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EBS/Blockbuster Local Media Body:: Strong work Laura! ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - May2001ExpenseReport Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: One more for Mark Metts Body:: Am I taking care of you or what?? ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: 3125A - meeting with Van der Walde, Hartsoe, Watkiss, per Lucy Marshall Body:: OK for you to join them late What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Deadline Today -- Draft Enron Comments on NERC Bill Body:: Attached are suggested comments on the draft NERC bill for which we were asked to provide comments by today. You will see that the response is a firm but polite -- no thanks. While I doubt NERC assumes that silence means support by their deadline today I would like to get something to them by COB if at all possible. (I will be on vacation tomorrow in any event). With apologies for the short turn around please call or e-mail your comments or OK this afternoon. John What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: AP Wires Thurs 3/22: Report: Power wholesalers overcharged California $5.= 5=20 billion Dow Jones Newswires Thurs 3/22: Reliant To Appeal Fed Judge Ruling To Sel= l=20 Pwr To Calif Sac Bee Thurs 3/22: Federal judge orders major power wholesaler to sell t= o=20 California San Jose Mercury News Thurs 3/22: State falling short on pacts that provi= de=20 low-cost energy Contra Costa Times Thurs 3/22: Crisis saps state surplus Sac Bee. Fri 3/23: Bill to pay small energy firms stalls Sac Bee Fri. 3/23: House panel ends energy hearings -- will it step in? Sac Bee Fri 3/23: Dan Walters: Crisis deepens: politicos panic San Diego Union Fri. 3/23: Report says power wholesalers overcharged=20 state $6 billion San Diego Union Fri 3/23: Disappearing state surplus sparks alarm San Diego Union Fri. 3/23: Outages darken economic outlook in state so= me=20 say San Diego Union Fri. 3/23: Out-of-state generators question power=20 regulators' authority San Diego Union Fri. 3/23: Allegheny Energy makes big California=20 connection LA Times Fri 3/23: Judge Frees Small Firm From Edison Contract SF Chron Fri 3/23: Lodi Defies Order for Blackouts=20 Utility tells PG&E to 'pay the bills' SF Chron Fri 3/23: Coming Down to the Wire=20 State legislators battle over alternative energy bills SF Chron Fri 3/23: Grid Operators Push to Prevent Overcharging=20 They say regulators must be aggressive to stop billing abuses=20 Mercury News Fri. 3/23: State's bill for energy could double this year Mercury News Fri. 3/23: Plan for alternate power plants stalls --- --- Report: Power wholesalers overcharged California $5.5 billion=20 DON THOMPSON Associated Press Writer Thursday March 22 2001=20 2001 Associated Press=20 (03-22) 11:41 PST SACRAMENTO Calif. (AP) -- Electricity wholesalers have= =20 overcharged California more than $5 billion since May by manipulating the= =20 energy market according to a report prepared for power grid managers.=20 The Independent System Operator will file the findings with federal=20 regulators and ask for a refund ISO spokesman Patrick Dorinson said.=20 The state auditor also said Thursday that the state's 1996 deregulation law= =20 encouraged both buyers and sellers of electricity to ``manipulate wholesale= =20 prices to their advantage'' by underestimating supply and demand.=20 The auditor's report lays out what it calls ``a complex combination'' of=20 deficiencies and misjudgments it says led to the state's power problems.=20 According to the ISO report five in-state power suppliers and 16 importers= =20 frequently offered electricity at prices higher than it cost them to produc= e=20 -- effectively withholding supplies -- or didn't bid at all when they were= =20 able to generate power.=20 ISO Director of Market Analysis Anjali Sheffrin presented the findings at a= =20 conference in Berkeley last week.=20 The companies have denied overcharging California and have said they expect= =20 the Federal Energy Regulatory Commission will determine their prices were= =20 justified.=20 The commission has recently stepped up scrutiny of power companies' behavio= r=20 during California's power crisis asking suppliers to justify $124 million = in=20 sales during the first two months of the year or refund the money. Critics= =20 claim thousands of additional questionable sales are not being challenged.= =20 California has been spending about $45 million a day -- $4.2 billion since= =20 January -- to purchase power for Pacific Gas and Electric Co. and Southern= =20 California Edison. Both utilities the state's largest have been cut off b= y=20 electricity wholesalers because their credit is almost worthless.=20 Edison and PG&E say they are nearly $14 billion in debt due to soaring=20 wholesale power costs. The state's deregulation law blocks them from=20 recovering the costs from customers.=20 State Controller Kathleen Connell said Wednesday that the state's=20 power-buying is gutting its budget surplus.=20 Since the state started making emergency power buys the surplus has fallen= =20 from $8.5 billion to about $3.2 billion she said.=20 Connell ordered an audit of the power buys saying Gov. Gray Davis is=20 withholding key financial information from her office and the Legislature.= =20 She said she would refuse to transfer $5.6 billion into a ``rainy day fund'= '=20 she said was set up to impress Wall Street as the state prepares to issue $= 10=20 billion in revenue bonds to cover its power buys.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routin= e=20 and required by law.=20 ``The law says she has to do it. The law does not give her the power to=20 demand that kind of audit information'' Harrison said.=20 Davis spokesman Steve Maviglio said the administration has released the=20 financial information it can without jeopardizing negotiations for long-ter= m=20 power contracts with wholesalers.=20 Also Wednesday a federal judge ordered a major wholesaler Reliant Energy= =20 Services to continue selling power to California despite its fear that it= =20 will not be paid.=20 The ISO buys power from companies like Reliant on behalf of utilities in=20 attempts to fend off rolling blackouts like those that hit the state this= =20 week and during two days in January.=20 --- Reliant To Appeal Fed Judge Ruling To Sell Pwr To Calif 03/22/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LOS ANGELES -(Dow Jones)- Reliant Energy Inc. (REI) said Thursday it will= =20 immediately file with the 9th Circuit Court of Appeals in San Francisco in= =20 response to a federal judge's ruling late Wednesday that the company contin= ue=20 selling power to California regardless of whether it is paid.=20 U.S. District Court Judge Frank Damrell granted California's Independent=20 System Operator which makes last minute power purchases in the spot market= =20 a preliminary injunction against Reliant saying Californians were at risk = of=20 irreparable harm if Reliant stopped selling power to the state. The ISO manager of the state's electricity grid said the judge's ruling= =20 will allow the agency to keep the lights on in California.=20 Reliant which is owed more than $300 million from the state's cash-strappe= d=20 utilities supplies California with about 3000 megawatts of electricity fr= om=20 power plants it owns in the state.=20 Reliant spokesman Richard Wheatley said the state Department of Water=20 Resources the agency that buys California's bulk power needs on behalf of= =20 PG&E Corp. (PCG) unit Pacific Gas & Electric Edison International (EIX) un= it=20 Southern California Edison and Sempra Energy (SRE) unit San Diego Gas &=20 Electric should back the ISO's last minute power purchases.=20 In a filing with the Securities and Commission Reliant said it is owed $10= 8=20 million by the DWR for last minute power purchases the ISO made during the= =20 six weeks prior to the agreement Reliant made with the DWR.=20 Damrell dismissed Reliant's claim saying he does not have the authority to= =20 force the DWR to pay for that power.=20 We're going to immediately appeal Judge Damrell's order Wheatley said.= =20 Clearly the judge understands the implications of his order. We are requir= ed=20 to do business with creditworthy entities. Unfortuantely the judge did not= =20 force the ISO to post a surety bond which would allowed us to do business= =20 with the ISO.=20 Gov. Gray Davis has said the state is not responsible for the last minute= =20 power purchases the ISO makes despite a law passed authorizing the DWR to= =20 buy power on behalf of the utilities.=20 Wheatley added that the company will also seek relief on the issue at the= =20 Federal Energy Regulatory Commission. Damrell's ruling remains in effect=20 until the Federal Energy Regulatory Commission rules on the matter.=20 Separately Wheatley said a short-term power supply contract that Reliant= =20 signed with the DWR expired Monday and the DWR has not renewed the contract= .=20 A spokesman for the DWR would not comment on the issue.=20 -By Jason Leopold Dow Jones Newswires 323-658-3874=20 jason.leopold@dowjones.com --- --- ----------------------- Federal judge orders major power wholesaler to sell to California Updated: March 21 2001 - 8:23 p.m.=20 A federal judge issued a preliminary injunction Wednesday ordering a major= =20 electricity wholesaler to continue selling to California despite its fear= =20 that it will not get paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant Energy Services stopped selling power to the=20 Independent System Operator which oversees the state's power grid. The ISO= =20 buys last-minute power on behalf of utilities to fill gaps in supply to try= =20 to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The state has been spending about $50 million a day on power for Pacific Ga= s=20 and Electric Co. and Southern California Edison both denied credit by=20 suppliers after amassing billions of dollars in debts. The judge said he had no authority to force the DWR to pay for that power.= =20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 Damrell denied the ISO's request for preliminary injunctions against three= =20 other wholesalers Dynegy AES and Williams who agreed to continue selling= =20 to the ISO pending the FERC ruling.=20 Spokesmen for Reliant Dynegy AES and Williams were out of the office=20 Wednesday night and didn't immediately return calls from The Associated Pre= ss=20 seeking comment on the ruling.=20 The ISO went to court in February after a federal emergency order requiring= =20 the power sales expired. The judge then issued a temporary restraining orde= r=20 requiring the sales but dropped it after the suppliers agreed to continue= =20 sales to California pending his Wednesday ruling.=20 The ISO said it would lose about 3600 megawatts if the suppliers pulled ou= t=20 enough power for about 2.7 million households. One megawatt is enough for= =20 roughly 750 homes.=20 Grid officials said Reliant's share alone is about 3000 megawatts. Reliant= =20 said the amount at issue actually is less than a fourth of that because mo= st=20 of the power is committed under long-term contracts.=20 Reliant which provides about 9 percent of the state's power worries it=20 won't get paid due to the financial troubles of PG&E and Edison.=20 PG&E and Edison say that together they have lost about $13 billion since Ju= ne=20 due to soaring wholesale electricity costs that California's 1996=20 deregulation law bars them from passing onto customers.=20 At the same time the state has faced a tight electricity supply due in pa= rt=20 to California power plant shutdowns for maintenance and to a tight=20 hydroelectric supply in the Pacific Northwest.=20 Managers of the state power grid imposed rolling blackouts across the state= =20 Monday and Tuesday as supply fell short of demand. Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts. State Controller Kathleen Connell said Wednesday that the energy crunch als= o=20 imperils California's financial health. Connell said the state's power-buying on behalf of Edison and PG&E is is=20 gutting its budget surplus. Since the state started making emergency power= =20 buys in January the surplus has fallen from $8.5 billion to about $3.2=20 billion she said.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is refusing a request by Davis and the Legislature to transfer $5.6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its=20 power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism. Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 Also Wednesday a report by Davis' chief power negotiator appears to show= =20 that as much as 75 percent of the state's power purchases will have to be o= n=20 the expensive short-term market this summer said Sen. Debra Bowen D-Marin= a=20 del Rey chairwoman of the Senate Energy Committee.=20 The prices may be phenomenol she said particularly given predicted=20 hydroelectric shortages due to drought in the Pacific Northwest.=20 The report by David Freeman who is negotiating the state's long-term power= =20 contracts shows California has finalized 19 contracts and has 25 agreement= s=20 in principle. Freeman said DWR is continuing to negotiate other contracts. Bowen said FERC should impose short-term price caps or let generators to=20 charge enough to make a reasonable profit or we could be subject to enormo= us=20 price-gouging this summer.=20 -- Associated Press --- State falling short on pacts that provide low-cost energy=20 Published Thursday March 22 2001 in the San Jose Mercury News=20 BY CHRIS O'BRIEN AND JOHN WOOLFOLK=20 Mercury News=20 The state has signed low-cost contracts for just a third of the energy it= =20 needs this year raising the prospect that California could be forced to bu= y=20 much of its electricity this summer on the expensive spot market.=20 A spokesman for Gov. Gray Davis conceded Wednesday that the state will be i= n=20 trouble without more contracts but insisted California will meet its needs= =20 through conservation and additional long-term deals for cheap electricity.= =20 The state according to a report released Wednesday has fallen far short o= f=20 the governor's goal of filling almost all its electricity needs through suc= h=20 deals. In fact the state has lined up contracts for about half the amount= =20 Davis had projected earlier this month.=20 If the state has to rely heavily on the volatile spot market where the pri= ce=20 of electricity this summer could reach five times the state's contract pric= e=20 pressure could mount to raise the cap on the electricity rates consumers pa= y.=20 But Steven Maviglio the governor's spokesman said ``The governor has sai= d=20 he's committed to work this in the existing rate structure so that's the= =20 plan.''=20 In the report sent to state lawmakers the state Department of Water=20 Resources indicated that it had secured just more than 20 million=20 megawatt-hours for this year leaving it far short of the 60 million=20 megawatt-hours needed.=20 ``This is just a progress report'' Maviglio said. ``They did all this in= =20 three weeks which is pretty amazing when you think about it and we have a= =20 lot more to do.''=20 The state got into the power buying business in January supplying it to th= e=20 state's nearly bankrupt utilities.=20 The state negotiated long-term contracts with generators to supply that pow= er=20 at a reduced rate. Based on the report the state will pay an average of $6= 8=20 per megawatt-hour over the next 10 years -- significantly less than in=20 December when prices spiked higher than $300 per megawatt-hour but not as l= ow=20 as the $55 Davis hoped to reach.=20 Most of this power however won't be delivered until 2004. From 2004 to=20 2006 the Department of Water Resources estimates it has enough power unde= r=20 contract. Until then the amount falls short.=20 In 2001 it appears the state has about one-third of the power it needs. Th= e=20 gap closes to about half in 2002 and two-thirds in 2003.=20 At a news conference in Los Angeles two weeks ago Davis said the state wou= ld=20 have to buy only 30 to 45 percent of the power it needs this summer on the= =20 open market.=20 At the time critics said with only two-thirds of the power under contract= a=20 rate increase was almost inevitable. Even Davis' chief negotiator S. David= =20 Freeman offered a bleak assessment for the summer saying that all availab= le=20 electricity has already been sold.=20 ``We'll be subject to extremely high prices'' said Frank Wolak a Stanford= =20 professor who sits on a market committee for the Independent System Operato= r=20 the agency that runs the state power grid.=20 Wolak said there are two main hopes for avoiding a price increase this=20 summer: Federal officials could cap the wholesale price a step they've=20 resisted or Californians can conserve an unprecedented amount of power. --- --- ----------------------- Crisis saps state surplus POWER CRISIS=20 Controller moves to block a transfer of funds saying the $8.5 billion=20 surplus has been cut more than half since January=20 By Mike Taugher TIMES STAFF WRITER=20 The energy crisis has bled California's once-touted budget surplus by more= =20 than half since taxpayers began buying electricity two months ago leading = a=20 top state finance official Wednesday to order an audit of the power purchas= es=20 and block Gov. Gray Davis' plan to transfer funds into a reserve account.= =20 A booming economy last year produced a budget surplus that totaled $8.5=20 billion in January. But that figure now stands at about $3.2 billion=20 according to Controller Kathleen Connell.=20 We started this year with a generous budget surplus Connell said in a=20 statement announcing her decision to block what Davis administration=20 officials described as a routine transfer of surplus money. The energy=20 crisis has taken much of that away and this transfer on top of the=20 electricity purchases would put the fund at risk.=20 Meanwhile the Davis administration released a report by David Freeman the= =20 governor's chief negotiator on power purchases on the progress of executin= g=20 long-term agreements meant to stabilize the power buys.=20 According to the report only about 40 percent of the electricity needed fr= om=20 the open market this year has been lined up. That means the state could be= =20 forced to continue buying a substantial amount of power on the highly=20 expensive spot market and further drain its coffers.=20 And a key regulatory panel is scheduled next week to issue a ruling that=20 would determine how quickly state funds will be replenished when it decides= =20 what portion of electric bill payments should be allocated to the state=20 treasury a decision that could include a rate increase to fully repay=20 taxpayers without further crippling the state's two largest electric=20 utilities.=20 The Public Utilities Commission also will consider whether it will force th= e=20 utilities to pay alternative energy producers whose shutdowns this week=20 contributed to blackouts.=20 Connell's action underscores a growing nervousness over the sheer volume of= =20 money that is being poured into energy buys despite the fact that state=20 officials plan to replenish the treasury with up to $10 billion in loans th= at=20 will be repaid by electricity consumers.=20 The state has committed to spending $4.2 billion to date to keep lights on= =20 since taxpayers were forced in mid-January to take over electricity buys fr= om=20 the financially crippled utilities Pacific Gas & Electric Co. and Southern= =20 California Edison. Tax money is going out at a clip of about $50 million a= =20 day.=20 High prices already have brought PG&E and Edison to the brink of bankruptcy= =20 and now the state's surplus is at risk according to Connell.=20 In addition to requesting an audit and announcing her intention to delay th= e=20 transfer to the reserve account Connell said she wanted the administration= =20 to send her office more information about the electricity purchases.=20 Davis' representatives questioned Connell's authority in trying to block th= e=20 funds transfer which they called a routine accounting procedure and accus= ed=20 her of making political hay.=20 It is not helpful to the taxpayers or ratepayers or the people who just wa= nt=20 to keep the lights on it isn't helpful to have the situation muddied like= =20 this said Sandy Harrison a Finance Department spokesperson. We're sorry= =20 it came up in this manner.=20 Connell and the administration have butted heads in recent weeks. The=20 controller wants to post details of the state's electricity purchases on he= r=20 Web site a plan that have been delayed under pressure from Davis because o= f=20 the governor's concerns that releasing those details will allow power=20 generators and traders to sell at higher prices.=20 Harrison said administration officials believe Connell lacks the authority= =20 either to block the funds transfer to a reserve account or to audit the sta= te=20 water resources department.=20 Two days of widespread blackouts this week show how vulnerable the power gr= id=20 is to financial glitches. Although several factors combined to produce the= =20 blackouts state power officials say the outages could have been avoided if= =20 the utilities were paying their bills to alternative energy producers.=20 Many of those producers including clean-burning natural gas power plants= =20 wind solar and geothermal energy developers shut down enough production t= o=20 spell the difference between grid reliability and blackouts Monday and=20 Tuesday.=20 Davis called the utilities' failure to pay bills to those producers known = as=20 qualifying facilities immoral. The QFs were either unable to buy gas fro= m=20 their suppliers or were frustrated with the utilities' failure to pay them.= =20 The utilities hoarded billions of dollars since November without paying an= y=20 money out said Davis spokesman Steve Maviglio. They've got the money --= =20 we're pulling the trigger to make them pay it.=20 The utilities however say they are doing all they can to conserve enough= =20 cash to continue operating. Together they owe the QFs about $1.5 billion.= =20 Next week the PUC is scheduled to consider whether to force the utilities = to=20 heed Davis' demand to pay the QFs and it might also decide how much of=20 ratepayers' bill payments will be used to refund taxpayers for power buys.= =20 PG&E says that under a formula proposed by the administration the water=20 resources department would receive about 40 percent of the money collected= =20 from ratepayers for power purchases.=20 The rest of that money about $240 million would have to be divided among= =20 QFs existing power contracts operating PG&E's nuclear and hydroelectric= =20 plants and what hour-by-hour purchases the utility still must make on the= =20 spot market according to PG&E spokesman John Nelson.=20 There isn't enough to do that he said.=20 That is making it increasingly likely that electric bills will be hiked=20 according to a growing chorus of officials and experts.=20 Unless rates are raised Nelson said the only entity that can absorb a lac= k=20 of payment or a partial payment is the state treasury. Cutting off any othe= rs=20 will lead to electricity becoming unavailable and more blackouts he said.= =20 If they do it under existing rates -- given that the existing pool of mone= y=20 is not enough -- who doesn't get paid or who gets a partial payment? Nelso= n=20 said. What's the only entity left with wiggle room? The state.=20 Rate hikes are also a sticking point in negotiations to bail out the=20 utilities through purchase of their transmission lines and other assets=20 Maviglio said.=20 They want rate increases of significant magnitude and we're not going=20 there he said.=20 WE CAN TRIM STORY HERE IF NECESSARY BUT KEEP TAGLINES AT BOTTOM=20 About one-third the electricity needed by the customers of California's thr= ee=20 major utility companies is produced by the companies themselves one-third= =20 comes from alternative producers who use environmentally friendly technique= s=20 and one-third is bought on the open market.=20 The state stepped in to buy the one-third needed from the open market after= =20 the utility companies ran out of cash and credit in January to make the=20 purchases themselves.=20 But that electricity has proven to be enormously expensive and Davis has= =20 planned to lower those prices by committing to long-term purchases.=20 Freeman's report on the progress of those long-term purchases dated March = 15=20 but released this week said the state has finalized 19 contracts with seve= n=20 suppliers and reached 25 additional agreements.=20 Mike Taugher covers the environment and energy. Reach him at 925-943-8324 o= r=20 mtaugher@cctimes.com.=20 Staff writer Andrew LaMar contributed to this story. --- --- ----------------------- Bill to pay small energy firms stalls By Kevin Yamamura Dale Kasler and Jim Sanders Bee Staff Writers (Published March 23 2001)=20 A quickly melded proposal that would assure payments for alternative energy= =20 suppliers whose money woes contributed to power blackouts this week stalled= =20 Thursday in a divided Legislature.=20 The state Senate passed the bill AB 8x but with Republicans balking it w= as=20 rejected in the Assembly along party lines. Assembly leaders said they may= =20 try again today.=20 For most of Thursday lawmakers scrutinized legislation they had overhauled= =20 the night before to include Gov. Gray Davis' plan to force utilities to pay= =20 solar wind and small gas-fired suppliers. Such providers called qualifie= d=20 facilities or QFs provide more than 20 percent of California's=20 electricity and their shutdowns were partly to blame for rolling blackouts= =20 Monday and Tuesday.=20 Under the Democratic governor's plan the state Public Utilities Commission= =20 would determine prices at which alternative generators may sell power but= =20 legislation is needed to authorize the PUC action.=20 Lawmakers faced time pressures Thursday. They wanted to pass the bill quick= ly=20 so the PUC could act next week and legislators could embark Monday on an=20 annual three-day lobbying trip in Washington D.C.=20 Assembly Speaker Robert Hertzberg D-Sherman Oaks said the Republicans'=20 rejection of AB 8x could jeopardize more than $4 billion the state has spen= t=20 or allocated for electricity during the energy crisis.=20 Hertzberg said producers of alternative energy which are owed more than $1= =20 billion have threatened to drag debt-ridden utilities into involuntary=20 bankruptcy if the Legislature failed to pass the measure.=20 They said it and I believe it Hertzberg said. If such bankruptcies occu= r=20 he added the state with its multibillion-dollar debt would become just=20 another creditor in a pile of creditors.=20 But Assembly Republican leader Bill Campbell of Villa Park said the=20 finger-pointing is unfair. Passage of AB 8x would not necessarily prevent= =20 bankruptcies he said.=20 One alternative energy provider won a crucial court ruling Thursday that=20 staved off at least for a while threats by some creditors to haul one or= =20 both big utilities into bankruptcy court for nonpayment of bills.=20 CalEnergy Co. Inc. won the right to sell its geothermal power which was=20 contracted to Southern California Edison on the open market. CalEnergy sai= d=20 it is owed $45 million by Edison.=20 If the Imperial County judge hadn't ruled in CalEnergy's favor the company= =20 and seven other QFs were fully prepared to file an involuntary bankruptcy= =20 petition against Edison this morning said David Sokol chief executive of= =20 CalEnergy's parent MidAmerican Energy Holdings Co. of Des Moines Iowa.=20 That is currently off the table.=20 An involuntary bankruptcy proceeding would take California's energy crisis= =20 into uncharted territory although a bankruptcy judge would have the leeway= =20 to reject the filing.=20 Freed from its contract with Edison CalEnergy will move to sell its=20 electricity to people who will pay for it Sokol said.=20 Besides calming the bankruptcy movement temporarily the ruling also could= =20 prompt other alternative energy providers -- hundreds of which have shut do= wn=20 because of nonpayment by Edison and Pacific Gas and Electric Co. -- to foll= ow=20 CalEnergy's example and find other buyers for their electricity said Gary= =20 Ackerman of the Western Power Trading Forum an association of generators.= =20 Assembly Republicans said they felt the Senate's decision to package three= =20 important energy issues into a single bill was an attempt to ramrod=20 legislation through both houses.=20 We have to stand and say no Campbell said during floor debate.=20 Besides determining alternative generator payments the bill would change a= n=20 earlier law by capping the value of bonds the state may sell for power=20 purchases at $10 billion. It also would extend to large businesses an=20 existing rate cap in the San Diego Gas and Electric Co. service area.=20 And it would earmark a portion of rates paid by utility customers to fund t= he=20 state's ongoing power purchases. Within a week the state will have spent= =20 $4.2 billion on power since January.=20 Without the bill some legislators fear Pacific Gas and Electric and=20 Southern California Edison would be reimbursed before the state.=20 They have got (some) gall to go to the PUC and say they're going to go to= =20 court to keep our money -- to keep our money to pay off their creditors= =20 said Senate President Pro Tem John Burton D-San Francisco.=20 Most of the bill's controversy however centered on how the PUC would trea= t=20 gas-fired alternative generators.=20 The commission issued a revised draft decision Wednesday that would impose= =20 prices for qualifying facilities at $79 a megawatt-hour for five-year=20 contracts or $69 a megawatt-hour for 10 years.=20 But those producers that use natural gas -- representing about two-thirds o= f=20 the alternative energy providers in California -- spent Thursday arguing th= at=20 Davis' plan to rescue them would all but guarantee that they would go out o= f=20 business instead.=20 The plan -- ordering Edison and PG&E to pay them a fixed price for their=20 power -- would set rates well below the cost of natural gas they said.=20 Democratic lawmakers tried to assure such producers that the PUC would set= =20 prices that make business sense even obtaining a letter to that effect fro= m=20 Loretta Lynch who heads the commission.=20 Davis has vowed to fine Edison and PG&E if they don't pay alternative=20 producers for future deliveries. But Sokol said his company isn't convinced= =20 that Edison will pay.=20 Calling Edison a confrontive in-your-face nasty organization Sokol sai= d=20 the utility was sitting on $2 billion and not paying its bills. Edison i= n=20 a Securities and Exchange Commission filing Thursday said its debts outwei= gh=20 its cash reserves by $722 million.=20 The Senate sent the Assembly two other bills that deal specifically with=20 supply and demand. The first SB 5x would spend about $1 billion on energy= =20 conservation and low-income assistance programs. The other SB 28x would= =20 streamline siting procedures for power plant construction.=20 In separate energy-related matters Thursday the Assembly approved:=20 AB 21x which would allow businesses industries or other electrical=20 customers to negotiate private contracts with energy providers.=20 Nine energy bills designed to generate or save 665 megawatts of electricity= =20 -- including 345 megawatts this summer. One megawatt is enough electricity = to=20 light about 1000 homes.=20 The state put power emergencies behind it after dropping out of a Stage 1= =20 alert late Wednesday. The California Independent System Operator which=20 manages the state's power transmission grid was predicting no further aler= ts=20 this week. It expected cooling temperatures and a regular dropoff in=20 electricity use on Fridays to lessen demand at the same time that more pow= er=20 plants were returning to service.=20 Bee staff writer Carrie Peyton contributed to this report.=20 --- House panel ends energy hearings -- will it step in? By David Whitney Bee Washington Bureau (Published March 23 2001)=20 WASHINGTON -- A key House panel wrapped up a series of hearings on the=20 California electricity crisis Thursday and now will decide whether to come = to=20 the state's aid with legislation.=20 But the panel's Texas chairman made clear that West Coast price controls=20 won't be on the table.=20 Caps will not be in anything I am submitting said Rep. Joe Barton=20 chairman of the House Energy and Commerce Committee's energy and air qualit= y=20 subcommittee.=20 Some form of federal controls to hold down escalating wholesale prices this= =20 summer because of power shortages has been the most frequent appeal of=20 witnesses who testified before the panel during roughly 30 hours of hearing= s=20 over five days.=20 Such controls have been sought by the governors of California Oregon and= =20 Washington. As power shortages are forecast for other regions states like= =20 New York also have appealed for temporary price controls to halt gouging.= =20 But the Federal Energy Regulatory Commission which is responsible for=20 enforcing reasonable wholesale rates under the Federal Power Act has refus= ed=20 to impose them and the Bush administration is bolstering that decision by= =20 opposing any legislation that would compel such action.=20 Barton in a brief hallway interview declined to say what other legislativ= e=20 remedies he might propose to address the worsening California situation.=20 He said he expects to submit a list of ideas to the White House today and= =20 after receiving comment on it sit down with other committee Republicans an= d=20 Democrats next week to see if any legislation is in order.=20 If we are going to do anything to help California or the West this summer= =20 we have to make it law within the next month or six weeks Barton said.=20 Even the panel's senior Democrat Virginia Rep. Rick Boucher was urging a= =20 careful and deliberate approach to the California crisis which he said w= as=20 largely of the state's own making.=20 There are steps Congress might take to provide some help to the West such = as=20 more money for conservation and relaxed federal regulation of air quality= =20 standards. That would permit older more polluting generators to operate=20 through a long hot summer when electricity demand could exceed supply by= =20 about 3000 megawatts roughly the amount needed to power 3 million homes.= =20 But Alan Lloyd chairman of the California Air Resources Board said power= =20 production already is being maximized without sacrificing air quality.=20 Simply put no essential electricity generation has been curtailed due to= =20 air emission limitations he said. California's programs to protect publi= c=20 health are not major factors in the electricity shortages experienced to=20 date.=20 The concern is that as shortages turn into more rolling blackouts wholesal= e=20 prices will jump even higher and steadily bleed the economies of California= =20 and the West Coast.=20 William L. Massey the lone member of the energy regulatory commission who= =20 supports price controls said at a Tuesday hearing that without them the We= st=20 Coast faces economic catastrophe this summer.=20 It was evident from the comments of some Republicans that they think their= =20 party could capitalize politically from a difficult summer.=20 If they had a bad summer it could show up in the polls said Rep. Charli= e=20 Norwood R-Ga. And sometimes that's not a bad idea.=20 One of the most dramatic exchanges during the weeklong hearings came Thursd= ay=20 with S. David Freeman the former general manager of the Sacramento Municip= al=20 Utility District who now heads the Los Angeles Department of Water and Powe= r.=20 He recently was named Gov. Gray Davis' chief negotiator with power generato= rs=20 for long-term contracts to stabilize future deliveries.=20 Don't feel sorry for California Freeman said. We're going to come out o= f=20 this stronger than ever.=20 But Freeman said it will be a year or two before all the fixes are in place= =20 and in the meantime the region desperately needs Congress' help to force th= e=20 FERC into controlling wholesale prices which witnesses said are likely to= =20 rise from $7 billion last year to as much as $70 billion or more this year.= =20 We recognize that the current administration and various legislators have= =20 their own opinion as to the California situation Freeman said. But my=20 personal plea is that if the federal government is not going to help us th= e=20 least it should do is refrain from legislation that attempts to tell us wha= t=20 to do.=20 Barton perked up at that idea.=20 Leave California alone huh? Barton said. That might be a good motto.= =20 --- --------------------- Dan Walters: Crisis deepens: politicos panic (Published March 23 2001)=20 That choking sound you hear is California's political class shifting into= =20 near-panic mode as it realizes that the energy crisis is on the verge of=20 becoming a full-scale meltdown with utilities forced into bankruptcy and= =20 consumers hammered by severe and prolonged power blackouts and soaring=20 electricity bills.=20 The Legislature which had been content to allow Gov. Gray Davis to handle= =20 the crisis on his own suddenly came to life Thursday jolted by this week'= s=20 unexpected rolling blackouts and threats by creditors to force the utilitie= s=20 into bankruptcy court. Lawmakers quickly fashioned a basketful of legislati= on=20 aimed -- or so they hope -- at increasing power supplies promoting=20 conservation and relieving the financial pressure on utilities and=20 electricity generators. But it may be too little too late -- and Davis and= =20 other politicians are already pointing fingers of blame aware that a=20 political price will be paid if the apocalypse strikes.=20 While Davis chants his mantra that he inherited a fatally flawed utility=20 deregulation scheme from predecessor Pete Wilson Republicans are blaming= =20 Davis for moving too slowly after the crisis first surfaced last summer an= d=20 even some of Davis' fellow Democrats are distancing themselves from the=20 governor.=20 Deregulation was a product of a Republican governor a Republican author a= nd=20 a Republican PUC (Public Utilities Commission) that was unduly impatient= =20 Davis said at one point this week as the Capitol buzzed with private=20 negotiations and public posturing.=20 A day later however state Controller Kathleen Connell a Democrat issued= a=20 warning that Davis' power purchases running at $50 million a day had=20 already drawn down state budget reserves by nearly two-thirds and she=20 refused to authorize additional transfers. It was a direct shot by Connell = at=20 Davis an old rival and came just a day after the governor had endorsed a= =20 Connell foe Antonio Villaraigosa in the duel for mayor of Los Angeles.=20 Other Democrats didn't join Connell's direct challenge to Davis but there= =20 is nevertheless a growing concern among Democratic legislators that the= =20 power purchases are costing many billions of dollars more than the governor= =20 had projected and could place the state budget in jeopardy. They're nervous= =20 because Davis has refused to reveal even to legislators exactly how much= =20 power the state is buying each day and how much it is paying.=20 From the few details that have been disclosed it's clear that the state is= =20 spending about $1.5 billion a month which would wipe out the state's=20 reserves by midsummer. It's also becoming increasingly clear that Davis=20 probably can't make good on his promise to avoid major consumer rate=20 increases unless the state is willing to plunge deeply and semi-permanentl= y=20 into debt to underwrite wholesale costs or unless federal authorities orde= r=20 huge refunds from power suppliers.=20 Rates in areas served by private utilities have risen only slightly while t= he=20 costs first to utilities and later to the state soared. Data from the=20 administration and utilities when collated indicate that the state is in= =20 line to collect just 20 cents for every dollar it's spending on power=20 purchases and the gap will increase as summer heat drives up demand.=20 Privately some economists say that private utility rates will have to rise= =20 33 percent to 50 percent to cover costs of current power supplies plus=20 utilities' past debts to generators and the state's purchase of the=20 utilities' transmission system if that deal is made final.=20 It's ultimately going to break down and the ratepayer is going to pay for= =20 it one way or the other Republican Sen. Jim Battin said during one of=20 Thursday's many committee hearings on utility legislation. No one disagreed= =20 with him.=20 DAN WALTERS' column appears daily except Saturday. Mail: P.O. Box 15779= =20 Sacramento CA 95852 phone (916) 321-1195 fax: (781) 846-8350 E-mail: dwalters@sacbee.com Recent columns: --- Report says power wholesalers overcharged state $6 billion=20 By Don Thompson ASSOCIATED PRESS=20 March 22 2001=20 SACRAMENTO =01) Electricity wholesalers have overcharged California more th= an=20 $6.2 billion by manipulating the energy market according to a report by an= =20 economist working for power grid managers.=20 The Independent System Operator planned to file the findings with federal= =20 regulators Thursday and ask for a refund said ISO spokesman Patrick=20 Dorinson.=20 In a related development the state auditor said Thursday that the state's= =20 1996 deregulation law encouraged both buyers and sellers of electricity to= =20 manipulate wholesale prices to their advantage by underestimating both=20 supply and demand.=20 Disappearing state surplus sparks alarm=20 Outages darken economic outlook in state some say=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 The auditor's report lays out what it calls a complex combination of=20 deficiencies and misjudgments it says led to the state's power problems.=20 The ISO's filing came a day after the state controller complained that a=20 relentless energy crisis is jeopardizing California's financial future.=20 Since May the companies manipulated the market by bidding at excessive=20 prices effectively withholding supplies or by not bidding at all when they= =20 had generation capability available according to the ISO study.=20 ISO Director of Market Analysis Anjali Sheffrin presented the findings at a= n=20 energy conference at the University of California Berkeley last week.=20 The companies have denied overcharging California and have said they expect= =20 the Federal Energy Regulatory Commission will determine their prices were= =20 justified.=20 In a burst of activity after weeks of delay both houses of the Legislature= =20 approved bills Thursday designed to ease the energy crisis.=20 The state Senate approved measures to encourage energy conservation and spe= ed=20 up power plant construction.=20 Topping that the Assembly sent the Senate 14 energy-related bills includi= ng=20 $455 million in loans and grants to encourage energy efficiency and=20 conservation and alternative energy projects by this summer.=20 One of the Assembly bills would require new energy plants approved by the= =20 state to sell their power within California before they offer it to other= =20 states.=20 The (California) Energy Commission says for every day we delay this bill= =20 there are 20 megawatts that could be saved that we're not saving said sta= te=20 Sen. Byron Sher D-Stanford as senators voted 28-10 to send his conservati= on=20 measure to the Assembly.=20 Senators also approved another Sher bill speeding up the siting of power=20 plants. It went to the Assembly on a 37-1 vote.=20 Meanwhile a federal judge issued a preliminary injunction Wednesday orderi= ng=20 one of the companies named in the ISO filing Reliant Energy Services to= =20 continue selling to California despite its fear that it will not be paid.= =20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant stopped selling power to the ISO which buys at= =20 the last minute on behalf of utilities to bolster supplies and try to fend= =20 off blackouts.=20 Such blackouts struck the state twice this week shutting off power to=20 hundreds of thousands of people from San Diego to Oregon snarling traffic= =20 and shutting down businesses.=20 The state remained free of any power alerts Thursday morning as power=20 reserves stayed above 7 percent.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= =20 Southern California Edison and Pacific Gas and Electric Co.=20 The judge said he had no authority to force the DWR to pay for that power.= =20 The utilities have been denied credit after amassing billions of dollars in= =20 debt paying high prices for power that the state's energy deregulation law= =20 prevents them from passing on to consumers.=20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power the ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 In another development Wednesday state Controller Kathleen Connell=20 complained that the energy crunch is imperiling California's financial=20 health.=20 Connell said the state's power buying on behalf of Edison and PG&E is gutti= ng=20 its budget surplus. Since the state started making emergency power buys in= =20 January the surplus has fallen from $8.5 billion to about $3.2 billion sh= e=20 said.=20 Connell ordered an audit of the state's power buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is also refusing a request by Davis and the Legislature to transfer $5.= 6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its power= =20 buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Connell is a candidate for mayor of Los Angeles in next month's election.= =20 The ISO study meanwhile covered five major in-state power suppliers =01)= =20 Reliant Dynegy Williams/AES Duke Energy and Mirant as well as 16 power= =20 importers. All deliver power to customers of Edison PG&E and San Diego Gas= &=20 Electric Co. the state's three largest investor-owned utilities.=20 All overcharged but some excessively and some by moderate amounts said= =20 ISO's Sheffrin.=20 According to the report the overcharging took place beginning last May wh= en=20 the energy crisis began and continued through last month.=20 During that time according to the report energy suppliers commonly offere= d=20 their electricity at twice the amount it cost them to produce.=20 FERC member William L. Massey said he wasn't shocked to hear the amount=20 overcharged added up to more than $5 billion.=20 Prices over the past 10 months in California have greatly exceeded the=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said.=20 Chuck Griffin spokesman for Atlanta-based Mirant said the company would=20 justify their charges to FERC officials.=20 I think we're missing sometimes just how basic the problem is in Californi= a.=20 Supply and demand are out of whack and some basic rules of economics kick i= n=20 when that happens he said.=20 --- ------------- Disappearing state surplus sparks alarm=20 Controller puts hold on transfer of $5.6 billion to reserve funds By Karen Kucher and Ed Mendel=20 UNION-TRIBUNE STAFF WRITERS=20 March 22 2001=20 The state's general fund surplus has dropped to $3.2 billion from $8.5=20 billion since January largely because California's power purchases are=20 devouring the money state controller Kathleen Connell said yesterday.=20 Connell said she wants to see more documentation about state power spending= =20 before approving the transfer of $5.6 billion from the general fund to a=20 special reserve fund requested by Gov. Gray Davis.=20 Connell said the state would have to borrow $2.4 billion to cover the=20 transfer.=20 Report says power wholesalers overcharged California $5.5 billion=20 Outages darken economic outlook in state some say=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 We started this year with a generous budget surplus. The energy crisis has= =20 taken much of that away and this transfer on top of the electricity=20 purchases would put the (general) fund at risk Connell said in a statemen= t.=20 Her action came on a day when state power supplies improved. After two days= =20 of forced outages this week no rolling blackouts were ordered yesterday.= =20 Several power plants came back on line and imports from the Pacific Northwe= st=20 provided enough electricity to meet demand yesterday said Stephanie=20 McCorkle a spokeswoman with the California Independent System Operator=20 which manages most of the state's power grid.=20 Gradually more (electricity) generation comes on every day McCorkle said= .=20 By Monday we should see somewhere around 2200 megawatts back in service= =20 that was not on this Monday. That's if no other generation falls off.=20 Meanwhile Connell's move took some by surprise.=20 A spokesman for the state Department of Finance said Connell is denying a= =20 routine transfer that is required by law. It was just a routine accounting= =20 measure that we didn't anticipate becoming controversial Sandy Harrison= =20 said.=20 Connell announced the denial of the transfer a day after Davis endorsed one= =20 of her opponents former Assembly Speaker Antonio Villaraigosa in the race= =20 for Los Angeles mayor.=20 Connell who monitors California's cash flow said she was deeply concerne= d=20 about putting the state's general fund in a deficit situation in light of t= he=20 energy crisis.=20 About two months ago the state began spending about $50 million a day to b= uy=20 power after Pacific Gas and Electric and Southern California Edison nearly= =20 went bankrupt. It is also purchasing power for customers of San Diego Gas a= nd=20 Electric.=20 The Davis administration said earlier this week it soon will begin spending= =20 an additional $500 million on power purchases bringing the total to $4.2= =20 billion.=20 As that staggering sum continues to grow the state won a court battle with= =20 an electricity supplier yesterday. A federal judge in Sacramento sided with= =20 the state and ordered the wholesaler to continue selling to California=20 despite its fear that it will not get paid.=20 Judge Frank C. Damrell Jr. said Californians were at risk of irreparable ha= rm=20 if Reliant Energy Services stopped selling power to the Independent System= =20 Operator. The ISO acquires last-minute power on behalf of utilities to fill= =20 gaps in supply to try to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The judge said he had no authority to force the DWR to pay for the power.= =20 Davis has said the state isn't responsible for purchasing the costly=20 last-minute power the ISO buys for Edison and PG&E despite a law authorizi= ng=20 state power purchases on the utilities' behalf.=20 Meanwhile those who manage the power grid say the forecast for power=20 supplies this week looks good although conditions can change quickly.=20 ISO managers continue to stress the importance of conservation. Utility=20 customers across the state conserved about 900 megawatts of power Tuesday= =20 which kept blackouts from being ordered that night.=20 As the power crisis worsened this week ISO managers wished aloud that they= =20 still could rely on business customers to shut down in exchange for lower= =20 energy rates.=20 Such interruptible customers saved as much as 2100 megawatts last spring= =20 a figure that dropped to about 1700 last summer and 1400 at the end of th= e=20 year. But in January the state Public Utilities Commission told utilities= =20 they could no longer impose fines on business customers who refuse to shut= =20 down when asked.=20 ISO managers realize the program was harming businesses with frequent=20 interruptions of service -- but they still miss having that option McCorkl= e=20 said.=20 It would have made an enormous difference but at the same time we=20 understand the impact it was having on businesses McCorkle said. --- -------------- Outages darken economic outlook in state some say=20 By Dean Calbreath? UNION-TRIBUNE STAFF WRITER=20 March 22 2001=20 Until this week the San Diego Regional Chamber of Commerce was predicting= =20 that the county was well-insulated from the growing threat of economic=20 recession.=20 But that was before the lights went out in the chamber's downtown=20 headquarters Monday.=20 Working by window light in his darkened office chamber economist Kelly=20 Cunningham rapidly erased his previous projections for 3.5 percent growth f= or=20 San Diego County. Cunningham now feels the local economy could fall into a= =20 recession thanks to its shaky supply of energy.=20 Report says power wholesalers overcharged California $5.5 billion=20 Disappearing state surplus sparks alarm=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 Blackouts are very disruptive to the economy Cunningham said. A busines= s=20 can absorb rising energy prices by cutting costs or raising its own prices.= =20 But an energy shutoff is much less predictable. It cuts into productivity.= =20 Those sentiments are being echoed throughout California as business leader= s=20 and economists worry that rolling blackouts will darken the state's=20 previously glowing economy.=20 At the University of California Los Angeles for instance leading financia= l=20 theorists will meet April 4 to discuss the question Can California grow in= =20 the dark? Although the topic was chosen before the recent string of power= =20 outages the blackouts have given the issue new urgency.=20 These blackouts are not just a single episode said UCLA economist Tom=20 Lieser. They are a bridge to what will happen this summer. If we don't fal= l=20 into a recession in the second half of the year we will fall pretty close.= =20 Tapan Munroe an economist formerly with Pacific Gas and Electric this wee= k=20 crossed out his projection for 2 percent statewide growth. After blackouts= =20 rolled toward his consulting offices in the Bay Area city of Moraga Munroe= =20 decided the state will be lucky if it manages zero growth.=20 I'm a pretty optimistic guy by nature but this has been sobering Munroe= =20 said. On Tuesday one restaurant alone in San Francisco lost $20000.=20 Multiply that by all of the businesses that lost power in the state and=20 you've got a serious problem.=20 Two days of blackouts in San Diego County have hurt businesses large and=20 small. Among the industries under threat is the local biotechnology sector= =20 which requires a steady supply of electricity to power areas of laboratorie= s=20 that must remain temperature-controlled and sterile.=20 Continued blackouts could have a huge impact not only in dollars but=20 multiple millions of dollars said Tom Oster vice president of operations= =20 for BioCom the leading trade organization for the more than 200 biotechs i= n=20 San Diego County.=20 Idun Pharmaceuticals a biotech near La Jolla Village Drive that has 67=20 employees had its power cut for about 40 minutes Tuesday. Though the compa= ny=20 has a back-up generator some segments of its laboratories and lab equipmen= t=20 were not supported by it. Chemists also had to turn off some sensitive lab= =20 equipment to avoid the possibility of a damaging power surge once the=20 blackout was over.=20 We're not in a position as a small company to back up the whole facility= =20 said Steven Mento Idun's chief executive. We haven't done a survey yet to= =20 determine whether we had losses either in experiments or equipment damaged= =20 -- but we're hoping because the blackout was so short that damage will be= =20 minimal.=20 Mento said rolling blackouts coupled with continuing high energy costs=20 could cripple many small biotechs -- and even take a bite out of bigger mo= re=20 established companies.=20 We generate new compounds in controlled environments on a daily basis and= =20 when power goes off you can lose samples because of contamination and other= =20 issues Mento said. We are fortunate that our losses would be in having t= o=20 repeat an experiment -- but this could be really critical for companies wit= h=20 drug manufacturing and issues of quality control.=20 The wireless firms along Sorrento Valley have not been immune from blackout= s.=20 The lights went out at Qualcomm early this week although executives declin= ed=20 to comment about the impact.=20 No blackouts hit the big shipbuilding operations on the waterfront this wee= k.=20 But the National Steel and Shipbuilding Co. -- one of San Diego's largest= =20 employers -- already experienced a voluntary loss of power this year its= =20 first since World War II. Since the shipyard does not have its own power=20 supply NASSCO executives fear the effect of unplanned outages.=20 Our average payroll totals half a million dollars a day said NASSCO=20 spokesman Jim Scott. When you have a day's work disrupted that can be=20 pretty serious. We're currently in discussions about the possibility of=20 buying from independent power suppliers or setting up a power plant of our= =20 own.=20 Small businesses which constitute the bulk of employment in San Diego=20 County were hurt by disruptions as well -- costing them vital revenue at a= =20 time when their power bills have skyrocketed.=20 At Fantastic Sam's a hair salon in Chula Vista Angelica Alcala estimated= =20 that business dropped 60 percent when the blackouts hit Tuesday. Among othe= r=20 things Alcala had to alter her planned haircuts because she was relying on= =20 scissors instead of electric clippers.=20 At the Family Fun Center in El Cajon the management gave vouchers or refun= ds=20 to the 15 or so video-game players who were in the midst of killing aliens = or=20 fighting ninja warriors as the power went down.=20 Papa John's Pizza estimates that it may have lost several thousand dollars = in=20 business after six stores were blacked out Monday and four others lost powe= r=20 Tuesday. Brian Mills who runs 23 Papa John's stores in the county said hi= s=20 main concern was shutting down the computers so they would not be damaged b= y=20 a power surge when the electricity was restored.=20 Paul Ecke III a member of the West Coast advisory panel for the Federal=20 Reserve said the potential impact of the energy crisis is worse than any= =20 downturn in the stock market.=20 Ecke who runs the Paul Ecke Ranch flower operation in Encinitas said the= =20 crisis could be particularly harmful for the state's agricultural sector= =20 since farmers need electricity to pump water and natural gas to heat=20 greenhouses.=20 What I'm really worried about is the energy thing is going to cast a shado= w=20 on California he said. If you're a business person thinking about moving= =20 to California right now you're probably not going to do it because you're= =20 not sure you're going to have your lights on this summer.=20 Besides the disruption to businesses the energy crisis is also hurting the= =20 pocketbooks of hourly workers who have been sent home during the crisis.=20 Under state law employers are free to send hourly workers home without pay= =20 during such emergencies although salaried workers must still be paid.=20 Susan Kemp an attorney with the California Chamber of Commerce said there= =20 are ways of minimizing the impact on hourly workers.=20 You have to look at what time it is when the blackout occurs and how long= =20 you think it's going to last Kemp said. If it's around a meal time you= =20 might send the workers out for a longer meal period if you think it's going= =20 to be an hour or hour and a half delay.=20 But the potential for losing wages doesn't sit well with the hourly workers= .=20 When you get sent home early and lose your wages you have even less money= =20 to pay your inflated energy bills said an hourly worker who was sent home= =20 during Monday's blackout.=20 --- ---------- Out-of-state generators question power regulators' authority=20 By Karen Gaudette ASSOCIATED PRESS=20 March 22 2001=20 SAN FRANCISCO =01) At least three major out-of-state electricity generators= are=20 challenging the authority of the California Public Utilities Commission to= =20 investigate whether they deliberately reduced power supplies to drive up=20 prices.=20 The PUC has asked for power plant maintenance records as it tries to=20 determine whether Duke Energy Dynegy Inc. Mirant Corp. and other=20 wholesalers have manipulated the energy market at California's expense.=20 At issue is who ultimately controls oversight of in-state plants that provi= de=20 most of California's electricity. The plants once owned by the state's=20 largest utilities were sold off as part of the state's 1996 attempt at=20 deregulation.=20 Report says power wholesalers overcharged California $5.5 billion=20 Disappearing state surplus sparks alarm=20 Outages darken economic outlook in state some say=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 PUC President Loretta Lynch said the public deserves to know whether=20 generators have unnecessarily taken plants off-line to create artificial=20 shortages forcing the utilities and now state bureaucrats to buy much high= er=20 priced power on the spot energy market.=20 What I do know is we have historically high levels of outages across the= =20 board Lynch told The Associated Press. Dynegy and Duke have been fightin= g=20 the PUC in the PUC's quest to obtain documents about these outages.=20 The PUC has the authority to regulate facilities within its borders she=20 added. It doesn't matter where the headquarters of the company is.=20 Duke based in North Carolina says it does matter =01) and that since it a= nd=20 other wholesalers aren't headquartered in California the PUC can't require= =20 it to turn over the maintenance records.=20 We have not given them proprietary information because they do not regulat= e=20 us said Duke's spokesman Tom Williams.=20 Dynegy did not return calls for comment Wednesday.=20 The PUC also faces a new challenge in the legislature. A bill sponsored by= =20 Assemblywoman Carole Migden D-San Francisco which would have granted the= =20 PUC greater inspection authority over out-of-state generators was amended= =20 this month to grant the authority to Independent System Operator instead.= =20 The ISO has managed the delivery of energy through most of the state's powe= r=20 grid but historically has done little regulating and has had no policing=20 authority.=20 This board created during the state's 1996 attempt at deregulation was=20 redesigned in January. Now it has a five-member board appointed by Davis= =20 replacing a 26-member ISO board composed of utility executives marketers= =20 power plant owners and others.=20 The latest version of Migden's bill requires wholesalers to report monthly = to=20 the ISO about any plants that are off-line or working at reduced capacity= =20 and gives the ISO power to audit these reports.=20 But because the ISO board historically has made key decisions behind closed= =20 doors and is exempt from certain open-government regulations government=20 watchdogs are outraged by the switch.=20 The PUC's been no friend of ratepayers but at least under the constitutio= n=20 and state law they're required to conduct their process in the open and the= =20 public can intervene said Harvey Rosenfield of the Foundation for Taxpaye= r=20 and Consumer Rights.=20 Davis ordered last month that the ISO take the lead among state agencies to= =20 ensure adequate energy supplies. Alan LoFaso an aide to Migden said the= =20 amendment follows Davis' lead.=20 Both LoFaso and the governor's spokesman Steve Maviglio downplayed the=20 change. I don't know if we have a preference as to which state agency get= s=20 the authority to continue the probe Maviglio said.=20 The challenge by Duke Energy Houston-based Dynegy Inc. and Mirant Corp. of= =20 Atlanta came in filings March 12 asking for a rehearing of the PUC's Februa= ry=20 resolution reasserting its legal authority to examine the books accounts= =20 memoranda contracts and records of generators selling energy to utilities= =20 already subject to PUC regulation.=20 Those utilities include Pacific Gas and Electric Co. and Southern Californi= a=20 Edison Co. which have been nearly bankrupted buying power from wholesalers= =20 as well as the financially troubled San Diego Gas and Electric -- Allegheny Energy makes big California connection=20 ASSOCIATED PRESS=20 March 22 2001=20 HAGERSTOWN Md. =01) Allegheny Energy Inc. said Thursday it has agreed to s= ell=20 $4.5 billion worth of power to California's electricity-purchasing agency= =20 over the next 10 years.=20 The company said the contract call for Allegheny to provide up to 1000=20 megawatts that the Hagerstown-based company has secured from western=20 generating plants through its new energy trading division Allegheny Energy= =20 Global Markets =01) formerly Merrill Lynch Global Energy Markets.=20 This is a win-win for both the state of California and Allegheny Energy. I= t=20 provides a long-term source of fixed-price energy and should help to=20 stabilize prices in California said Michael P. Morrell president of the= =20 Allegheny Energy Supply division.=20 --- ----------- Judge Frees Small Firm From Edison Contract=20 By KEN ELLINGWOOD and DAN MORAIN Times Staff Writers=20 ?????EL CENTRO--California's balance of electrical power shifted slightly= =20 Thursday when an Imperial County judge temporarily freed a small geothermal= =20 energy producer from its contract with Southern California Edison allowing= =20 it to sell power on the open market. ?????The ruling by Superior Court Judge Donal B. Donnelly could lead to a= =20 mass exodus by hundreds of small energy producers that have been selling=20 power to the state's financially troubled utilities for months without=20 getting paid. ?????At the same time it may have staved off plans by a group of the small= =20 generators to send Edison into involuntary bankruptcy as early as today. ?????In Sacramento energy legislation pushed by Gov. Gray Davis passed in= =20 the state Senate but foundered in the Assembly. The measure was intended to= =20 ensure that the state gets repaid for the electricity that it has been buyi= ng=20 on behalf of Edison and Pacific Gas & Electric which say they lack the cas= h=20 and credit to purchase power. The bill also was supposed to guarantee that= =20 the small alternative energy producers--which together provide nearly a=20 third of the state's power--get paid. But Assembly Republicans opposed it= =20 saying it hadn't been given sufficient scrutiny. ?????The impact of the small producers was made clear in Imperial County= =20 where Edison's failure to pay CalEnergy the county's biggest property=20 taxpayer had outsize implications. CalEnergy had put county officials on= =20 notice that it was about to miss a $3.8-million property tax payment. The= =20 uncertainty had prompted the tiny Calipatria Unified School District to=20 postpone a bond issue for badly needed school repairs. ?????Among CalEnergy Chairman David Sokol's first acts after the judge's=20 ruling Thursday was to promise Imperial County Supervisor Wally J. Leimgrub= er=20 that the company would pay its property taxes on time. ?????That is great news Leimgruber said. ?????Within hours of its court victory CalEnergy had stopped transmitting= =20 geothermal power to Edison and begun selling it to El Paso Energy a=20 marketing company that purchased the energy at prevailing rates and resold = it=20 on the spot market. ?????Some of the more than 700 other small energy producers in the state sa= id=20 they were considering similar action against Edison and Pacific Gas &=20 Electric. ?????We absolutely need the right to sell to third parties said Dean=20 Vanech president of Delta Power a New Jersey company that owns five small= =20 gas-fired plants in California and is owed tens of millions of dollars by= =20 Edison. ?????Sokol praised the Imperial County judge and said his company simply=20 wanted the authority to sell its power to a credit-worthy company that in= =20 fact pays for the power. ?????An Edison spokesman said the company was disappointed with the ruling= =20 but sympathized with CalEnergy and other small producers because=20 California's power crisis has placed [them] in financial distress just as= =20 it has placed utilities in financial distress. ?????Edison expressed concern that the ruling would prompt CalEnergy and=20 other small producers to sell their power out of state. Sokol said CalEnerg= y=20 had specifically told El Paso Energy that it hoped its power would remain i= n=20 California but if someone wants to pay a higher price out of state we=20 can't stop them. ?????Sokol said that Edison still owes CalEnergy $140 million and that the= =20 company--along with seven other small producers--had been prepared to file = a=20 petition in federal bankruptcy court in Los Angeles today forcing the utili= ty=20 into involuntary bankruptcy. He said his company no longer intends to do so= =20 and he believed--but wasn't certain--that the other companies would shelve= =20 their plans. ?????Edison filed papers Thursday with the federal Securities and Exchange= =20 Commission showing that it owed $840 million to various small electricity= =20 producers many of which rely on renewable energy sources such as geotherma= l=20 steam solar energy or wind. ?????The alternative energy producers--and utilities--strenuously objected = to=20 the legislation considered in Sacramento on Thursday. The bill spelling ou= t=20 how the utilities are to pay the state and the small producers passed the= =20 Senate on a 27-9 vote the exact two-thirds margin required. But it stalled= =20 in the Assembly on a 46-23 party-line vote well short of two-thirds. ?????When I was a citizen back in Lancaster I heard these stories about= =20 pieces of legislation that were cooked up late at night that . . . were cu= t=20 and pasted together and were rammed through by the Legislature Assemblyma= n=20 George Runner (R-Lancaster) said. That's exactly what we have before us. ?????The alternative electricity generators including oil companies warne= d=20 that they would lose money under the Davis proposal while representatives = of=20 Edison and PG&E which have amassed billions in debt in the worsening energ= y=20 crisis said the legislation would push them deeper into the hole. ?????There isn't enough money Edison attorney Ann Cohn testified at a=20 Senate hearing on the bill Thursday. It is a very simple question: Dollars= =20 going out cannot be greater than dollars coming in. ?????The bill AB 8X combined several proposals. First it sought to clari= fy=20 earlier legislation by spelling out that Edison and PG&E must pay the state= =20 all money collected from consumers for electricity that the state has been= =20 buying. ?????Additionally the bill would turn over to the California Public=20 Utilities Commission the thorny issue of how much to pay alternative energy= =20 producers for their electricity. ?????Wind solar and geothermal producers might agree to the prices offered= =20 by the administration. But most of the alternative energy producers=20 including Chevron and British Petroleum use natural gas to generate=20 electricity through cogeneration a process of creating steam for both=20 electric generation and heat. With natural gas prices high they contend= =20 they would lose money at the prices Davis is offering. ---=20 ?????Ellingwood reported from El Centro Morain from Sacramento. Times staf= f=20 writers Mitchell Landsberg in Los Angeles and Jenifer Warren Nancy Vogel a= nd=20 Carl Ingram in Sacramento contributed to this story. --- ------------------- Lodi Defies Order for Blackouts=20 Utility tells PG&E to 'pay the bills'=20 Alan Gathright Chronicle Staff Writer Friday March 23 2001=20 2001 San Francisco Chronicle=20 URL:=20 /23/M N171303.DTL=20 Let history show that the rebellion against rolling blackouts started when= =20 the Central Valley town of Lodi defied PG&E and refused to unplug its=20 customers this week.=20 Like several cities that own their own utilities Lodi saw the energy crunc= h=20 looming last fall and spent millions for long-term power contracts in an=20 attempt to avoid blackouts.=20 Now Lodi and a Northern California municipal utility cooperative that=20 includes Palo Alto Santa Clara and Alameda are telling Pacific Gas and=20 Electric Co. that it's unfair to force their customers to endure blackouts= =20 triggered by the near-bankrupt utility's failure to pay its debts.=20 The problem is not paying bills so pay the bills said Alan Vallow=20 director of the utility serving Lodi's 58000 residents. I won't arbitrari= ly=20 screw my customers . . . so 5000 PG&E customers can turn on their lights= =20 somewhere else.=20 When PG&E relayed an order from state power regulators Monday and Tuesday f= or=20 Lodi to black out some of its customers a strategy intended to keep the=20 West's power grid from collapsing Lodi said no.=20 So far other cities in the Northern California Power Agency say they will= =20 continue to participate in rotating outages.=20 But in a letter last Friday to PG&E members of the agency and four other= =20 utility districts including Sacramento's warned they didn't believe long-= =20 standing agreements that allow them to use PG&E transmission lines to conne= ct=20 to the grid obliged them to endure rolling blackouts because of PG&E's=20 failure to pay its power obligations.=20 They say the agreements require them to reduce power demand only in respons= e=20 to natural disasters or malfunctions damaging power lines or plants.=20 The agencies asked for a meeting with PG&E President Gordon Smith before=20 anticipated summer blackouts hit to develop a more rational program for= =20 allocation of risks associated with (power demand) load shedding before you= =20 call on us to participate in load shedding again.=20 REFUSING TO SHARE BURDEN PG&E officials accused Lodi of selfishly refusing to share the burden of th= e=20 statewide energy crisis.=20 It is regrettable that after reaping the benefits of the (power grid)=20 interconnection contract for many years Lodi is suddenly unwilling to bear= =20 their share of the burden of the statewide energy crisis said PG&E=20 spokesman Ron Low. When cities like Lodi do not follow the (state=20 Independent System Operator's) order to curtail power it hurts all of=20 California and jeopardizes the entire power grid.=20 Low also disagreed with accusations that this week's blackouts were trigger= ed=20 by PG&E's failure to pay its bills noting that the ISO stated that 12000= =20 megawatts of power were offline because of plant maintenance.=20 But ISO spokeswoman Lisa Szot confirmed assertions by the municipal utiliti= es=20 that power generators had kept an additional 3000 megawatts offline becaus= e=20 they feared PG&E couldn't pay.=20 Lodi's Vallow said he was legally obliged to serve city customers. Lodi=20 residents are facing rate increases of as much as 15 percent under a power= =20 contract that the city secured in hopes of avoiding blackouts. The contract= =20 required Lodi to pay a $10 million premium above its typical $23 million=20 annual energy bill.=20 'THAT'S NOT FAIR'=20 I've been hearing (PG&E say) 'Gee that's not fair. Where's the equity if= =20 everybody is doing rolling blackouts and you're not?' Vallow said. Well= I=20 put my customers at financial risk to the tune of $10 million. And if they'= re=20 not going to get to use that power they paid for then by God give us that= =20 money back.=20 Vallow said he was willing to sell PG&E some of Lodi's power surplus knowi= ng=20 Lodi might not be paid.=20 But I'm not willing to turn off 5000 customers so 5000 customers=20 somewhere else can turn their lights on Vallow said. The objective here= =20 people is to keep as many lights on as possible.=20 Other city-owned utilities while annoyed with the rolling blackouts aren'= t=20 going as far as Lodi.=20 WEATHERING BLACKOUTS I certainly understand the frustrations of utilities like Lodi and actuall= y=20 share those frustrations in many cases said John Roukema assistant=20 director of Santa Clara's utility.=20 But he stressed that his agency had been able to weather blackouts without= =20 hurting residents or small business because 17 major industrial power user= s=20 had agreed to curtail demand during energy alerts.=20 The prudent thing to do at this time is to continue to do our share and=20 participate in rolling blackouts because a single problem could cause a=20 catastrophic failure in the statewide system Roukema said.=20 In Alameda residents endured blackouts this week despite the fact that cit= y=20 has secured reliable power supplies said Matt McCabe spokesman for Alamed= a=20 Power & Telecom.=20 It was in the best of interests of Alamedans to maintain the stability and= =20 integrity of the grid he said. Now if it becomes evident that the syste= m=20 is being jeopardized for financial reasons then we should not have to=20 subject Alamedans to rolling blackouts.=20 In Palo Alto which also had blackouts this week utility officials told th= e=20 City Council they were expecting a 30 to 40 percent rate hike this spring t= o=20 pay new contracts guaranteeing a stable power supply said Councilman Bern= =20 Beecham. The city hopes to avoid giving customers the double whammy of rate= =20 boosts and more blackouts with a program that gets industrial users to cut= =20 demand voluntarily during alerts.=20 When there's not enough generating capacity in the state to protect the=20 integrity of the grid that is in fact everybody's problem Beecham said= =20 but that doesn't mean Palo Alto is willing to endure blackouts to prop up= =20 PG&E's ailing finances.=20 We need to have some very frank discussions with PG&E about mutual=20 obligations Beecham said.=20 Energy Tips=20 With Californians facing electricity and natural gas shortages PG&E has=20 several tips to help conserve both:=20 -- Set the furnace thermostat at 68 degrees or lower health permitting.=20 -- Wash only full loads in a dishwasher. If operating instructions allow= =20 turn dishwasher off before the drying cycle and let dishes dry naturally.= =20 -- Use low-wattage or fluorescent lights.=20 -- Fix defective plumbing and dripping faucets which waste water and=20 increase the gas or electric bill for heating the water.=20 -- Plug gaps around pipes ducts fans and vents that go through walls=20 ceilings and floors.=20 -- Keep furnaces clean and clean or replace the filter regularly.=20 -- Turn heaters down when using a fireplace and close the damper when not= =20 using the fireplace.=20 -- On sunny days open drapes on windows facing south and let the sun shine= =20 in. At night close the drapes to retain indoor heat.=20 Source: www.pge.com=20 E-mail Alan Gathright at 2001 San Francisco Chronicle ? Page?A - 1=20 --- Coming Down to the Wire=20 State legislators battle over alternative energy bills=20 Greg Lucas Robert Salladay Chronicle Sacramento Bureau Friday March 23 2001=20 2001 San Francisco Chronicle=20 URL:=20 /23/M N113351.DTL=20 Sacramento -- After several weeks of slow to no progress in attacking the= =20 state's energy mess the Legislature erupted yesterday into a frenzy of=20 energy activity.=20 The sudden action on a series of energy bills -- including one to let=20 businesses buy power directly from generators -- stemmed initially from the= =20 fear of bad publicity lawmakers might receive for a planned three-day junke= t=20 next week to Washington D.C.=20 When a key bill bogged down in the Assembly late yesterday Speaker Bob=20 Hertzberg D-Sherman Oaks announced the trip was canceled.=20 Another reason for the flurry of action was recognition that time is runnin= g=20 out.=20 Several alternative energy producers -- like wind farms and biomass plants = -=20 - said they were one day away from forcing the state's two biggest utilitie= s=20 into bankruptcy because they were owed more than $1 billion.=20 The Legislature's action and a court ruling that could free alternative=20 producers from unpaid contracts.=20 This is triage members of the Senate said Sen. Jim Costa D-Fresno. Th= is=20 is crisis activity we're engaged in.=20 The Senate approved a bill aimed at helping state regulators get cash to so= me=20 alternative energy producers. Most of them have been paid little or nothing= =20 since November by the utilities they sell electricity to.=20 Senators passed a bill to help the Public Utilities Commission order=20 utilities to pay solar wind and other alternative energy producers who sig= n=20 lower-priced contracts with the utilities.=20 The bill failed in the Assembly because of GOP opposition fanned in part b= y=20 price concerns by the oil industry a major co-generation producer. The=20 Assembly is set to meet again today to try again pass the bill which the P= UC=20 needs to issue its final order.=20 The PUC's proposed order offers the first hint of financial relief for=20 hundreds of alternative energy producers known as ''qualified facilities = in=20 the energy industry who have been paid just pennies on the dollar by cash-= =20 strapped Pacific Gas & Electric and Southern California Edison.=20 Lack of payments has caused many alternative generators to shutter their=20 operations.=20 The PUC's proposal which will be considered at the commission's meeting=20 Tuesday offers generators a choice of agreeing to a five-year contract at= =20 $79 per megawatt or a 10-year deal at $69 per megawatt Davis said. The goi= ng=20 rate now is about $150 a megawatt hour.=20 The order does not address money already owed to the more than 600=20 alternative energy producers.=20 Under the order utilities would have to pay any generator who signed the n= ew=20 contracts within two weeks.=20 But PG&E said it might not be able to afford do that.=20 Operators of co-generation facilities say the contracts contemplated by the= =20 PUC don't cover their cost of producing energy because the sale price no=20 longer would be pegged to the the price of natural gas.=20 In a significant court decision affecting generators one geothermal energy= =20 supplier in Imperial County won a lawsuit yesterday against Edison allowing= =20 the company to escape a contract requiring it to sell electricity to the=20 utility.=20 A superior court judge said CalEnergy operator of the geothermal plant=20 could suspend deliveries to Edison and sell the 268 megawatt hours it=20 generated on the open market.=20 CalEnergy is owed $75 million by the utility.=20 The court victory may ease mounting pressure from some qualified facilities= =20 including CalEnergy to drive one or both of the utilities into involuntary= =20 bankruptcy.=20 The Assembly and Senate meanwhile rushed through a series of bills aimed = at=20 increasing energy conservation and rushing the building of new power plant= s.=20 Most significant for bigger residential and commercial utility customers is= a=20 measure passed by the Assembly to allow energy customers to buy power=20 directly from generators.=20 That right was eliminated in January when the state began buying power for= =20 the cash-strapped utilities.=20 The bill approved unanimously yesterday would impose a yet to be determined= =20 exit fee on customers who leave the power grid to help cover the state's=20 financial exposure.=20 Tell Us What You Think=20 Can you save 20 percent on your energy use? Gov. Gray Davis' administration= =20 is offering rebates for Californians who save on power starting in June an= d=20 if you've got a strategy for conserving The Chronicle wants to hear it.=20 We'll be writing about the hardest-working energy savers in a future story.= =20 To get involved write to the Energy Desk San Francisco Chronicle 901=20 Mission St. San Francisco CA 94103 or e-mail energysaver@sfchronicle.com= .=20 E-mail the reporters at glucas@sfchronicle.com and bsalladay@sfchronicle.co= m.=20 2001 San Francisco Chronicle ? Page?A - 14=20 --- State's bill for energy could double this year=20 Posted at 9:34 p.m. PST Thursday March 22 2001=20 BY=20 STEVE=20 JOHNSON=20 AND=20 JOHN=20 Warning that California is imperiled by the prices it is paying for=20 electricity a report Thursday said the state's annual power tab could wind= =20 up being 10 times what it was two years ago.=20 At the current rate of spending the report estimated that the total=20 electricity bill in California this year could hit $70 billion which is mo= re=20 than twice what it was last year and about 10 times what was paid in 1999 a= nd=20 1998.=20 ``The California electricity market has gone from being `dysfunctional' to= =20 precipitating a crisis'' according to the report from the Independent Syst= em=20 Operator.=20 It added that the price being charged ``threatens any semblance of just and= =20 reasonable consumer rates the financial viability of California's=20 investor-owned utilities the financial stability of California of its=20 neighboring states and of the nation.''=20 While power suppliers denied any wrongdoing the report said the state=20 appears to have been hit with ``excess'' charges totaling $6.87 billion sin= ce=20 May based on an assessment of the typical operating costs of power plant= =20 owners. Out of that total $6.2 billion appeared to be excessive charges=20 during times when power was not in particularly short supply the agency=20 said.=20 The cost of power has become a growing concern now that the state has stepp= ed=20 in to buy it on behalf of Pacific Gas & Electric Co. and Southern Californi= a=20 Edison which claim to be so strapped for cash that they are on the verge o= f=20 bankruptcy.=20 In making public the report which was sent to the Federal Energy Regulator= y=20 Commission officials at the Independent System Operator were careful not t= o=20 accuse any power companies of price gouging. While the prices appeared to b= e=20 unreasonable they said the state needs to learn more about the specific= =20 operating costs of power plant operators before they could determine whethe= r=20 California was cheated.=20 The officials said they were considering asking the federal agency which= =20 oversees power wholesalers to order the suppliers to make refunds. In the= =20 past two weeks the federal agency has warned a number of suppliers that th= ey=20 may have to refund $135 million in apparent overcharges during January and= =20 February.=20 But many experts question whether the federal agency is serious about=20 demanding such refunds so California officials also are reviewing the=20 possibility of suing the suppliers or seeking criminal charges against some= =20 of them. ``We're working very closely with a number of agencies to review t= he=20 information we currently have to determine what remedies may be available'= '=20 said Charles Robinson the Independent System Operator's general counsel.= =20 The report's suspicions were partly bolstered by another study made public= =20 Thursday by the state auditor. It said California's market structure=20 encouraged bidding gamesmanship by both utilities and power sellers ``in an= =20 effort to manipulate wholesale prices to their advantage.'' But it stopped= =20 short of accusing power generators of profiting illegally.=20 ``There's clearly some evidence of market abuse'' said state Auditor Elain= e=20 Howle. Even so she added ``that's not to say it's anything illegal. We=20 hired consultants they looked at some of the bidding and they weren't=20 comfortable going that far.''=20 Although no power companies were named in either report officials with=20 several suppliers insisted they have done nothing wrong.=20 ``We've conducted our business legally and ethically'' said Richard=20 Wheatley spokesman for Reliant Energy which runs five major California=20 power plants. ``The ISO report appears to be nothing more than just another= =20 attempt to put blame at someone else's doorstep when there's been very=20 little action out of Sacramento to resolve the problems in the California= =20 marketplace.''=20 Duke Energy spokesman Jeremy Dreier said the company which runs plants in= =20 Moss Landing and Morro Bay sold most of its power last year and this year = in=20 relatively low-cost long-term contracts and was among the first to offer= =20 such deals to the state. He added that Duke increased production from its= =20 aging plants to meet surging demand.=20 ``The fact that we were among the first to bring long-term contracts to the= =20 table speaks volumes about how we're trying to serve this market'' Dreier= =20 said.=20 John Sousa of Dynegy Inc. which co-owns three major California plants add= ed=20 that ``given the market conditions the rates we charged were just and=20 reasonable.''=20 --- Plan for alternate power plants stalls=20 Posted at 10:03 p.m. PST Thursday March 22 2001=20 BY DION NISSENBAUM AND JENNIFER BJORHUS=20 Mercury News=20 SACRAMENTO -- The state's prospects for plugging a critical electricity gap= =20 dimmed Thursday when the state Assembly rejected a rescue plan for=20 alternative power companies and a state judge ruled that one such firm coul= d=20 stop selling energy in California.=20 Both actions threaten the plan Gov. Gray Davis announced just Tuesday to ke= ep=20 these companies running and stave off more blackouts. With the state's=20 troubled utilities failing to pay for their electricity many alternative= =20 energy plants have been shutting down.=20 The dual blows came on a day when tempers flared in the Capitol as lawmaker= s=20 jarred by back-to-back blackouts launched bipartisan attacks on Pacific Gas= &=20 Electric Co. and Southern California Edison which aren't paying wind sola= r=20 biomass geothermal and small gas-fired plants for their electricity.=20 After Republicans shot down the measure meant to keep alternative energy=20 companies in business Assembly Speaker Robert Hertzberg D-Van Nuys warne= d=20 that the restless companies might act on their threat to force the utilitie= s=20 into bankruptcy.=20 ``They said it and I understood them to mean it'' he said.=20 The failure overshadowed a burst of action in Sacramento where lawmakers=20 approved a host of other measures. The Senate approved two key bills: one= =20 that would spend more than $1 billion to encourage Californians to conserve= =20 energy and one that would make it easier to build power plants. The Assembl= y=20 approved 14 incremental bills.=20 Six votes short=20 But the Assembly fell six votes short of passing a hastily prepared bill=20 meant to help prop up the nearly 700 alternative energy companies many of= =20 which are now idle.=20 Those closings sapped California of energy this week and helped cause two= =20 days of rolling blackouts -- the first since January.=20 In response Davis and lawmakers cobbled together a plan to set new lower= =20 rates for alternative power and to fine the utilities if they refuse to pay= =20 these companies which supply up to a third of the state's power.=20 But Republicans refused to back the measure and said it contained too many= =20 complex parts that needed more time to analyze.=20 ``Everyone in this room knows that this piece of legislation has not had a= =20 good look'' said Assemblyman George Runner R-Lancaster.=20 Assemblyman Fred Keeley D-Santa Cruz castigated the Republicans and=20 implored them to accept an imperfect solution.=20 ``Ladies and gentlemen: Welcome to the NFL'' he said. ``Welcome to the wor= ld=20 where large complex issues don't have a simple solution.''=20 Approval is needed before state regulators at the Public Utilities Commissi= on=20 can vote on the fine points of the plan. That was supposed to happen Tuesda= y.=20 Much of the criticism focused on concerns raised by power plants that use= =20 natural gas to produce energy. Administrators from those plants said the=20 Davis price caps would make it impossible for them to break even.=20 The derailment came hours after the measure narrowly won approval in the=20 state Senate.=20 Hertzberg plans to search for a compromise today and canceled plans for the= =20 Assembly's annual trip to Washington.=20 Thursday's actions were highlighted by angry attacks on the utilities by=20 frustrated lawmakers.=20 ``I hope they do go bankrupt'' shouted Senate President pro tem John Burto= n=20 D-San Francisco during a debate on the energy crisis. ``Let them go belly= =20 up. I don't care any more.''=20 Legal decision adds twist=20 The legislative failure was compounded by a legal decision in Southern=20 California that further complicated the picture.=20 A Superior Court judge in Imperial County cleared the way for CalEnergy=20 Operating Corp. to break its contract with Edison and sell its 268 megawatt= s=20 of power on the open market. The judge concluded that Edison had breached i= ts=20 contract by failing to pay CalEnergy since November.=20 That ruling could pave the way for hundreds of others to follow suit and=20 drain off power California needs to prevent blackouts.=20 ``It's not good'' said V. John White director of the Center for Energy=20 Efficiency and Renewable Technologies. ``This is potentially going to chang= e=20 the dynamics of the situation and probably not for the better.''=20 Jan Smutny-Jones executive director of the Independent Energy Producers=20 Association said it was unclear whether other companies would sue.=20 ``I think this is a very significant development'' he said. ``We're sort o= f=20 at a period where the industry's reaching the end of the rope.''=20 The ruling did have one silver lining: CalEnergy Chairman David Sokol said= =20 his company and seven others had planned to force Edison into bankruptcy if= =20 they lost in court.=20 But he also warned ``You stick a sharp stick in enough people's eyes and= =20 they get pretty tired of it.''=20 The situation with generators supplying PG&E isn't as dire since the compan= y=20 has been making partial payments.=20 Kent Burton senior vice president for Covanta Energy Corp. in New Jersey= =20 said ``They've tried to be responsive.''=20 Mercury News Staff Writer Mark Gladstone contributed to this report. Contac= t=20 Dion Nissenbaum at dnissenbaum@sjmercury.com or (916) 441-4603 or Jennifer= =20 Bjorhus at jbjorhus@sjmercury.com or (408) 920-5660. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Wed 6/6: Businesses vie for blackout exemptions:=20 The PUC must decide who should be spared and the applicant list is very lo= ng Sac Bee Wed 6/6: PG&E ISO agree to court order on power bills Sac Bee Wed 6/6: Peter Schrag: Turning up the heat in Houston and=20 Washington (Editorial) SD Union Wed 6/6: Is trading an insider's game? SD Union Wed 6/6: Daily energy costs for state fall in past weeks=20 SD Union Wed 6/6: Five tiers sought in proposed rate boost SD Union Wed 6/6: Port budget large but power bills loom SD Union Wed 6/6: Continuous use urged for planned power plant=20 SD Union Wed 6/6: Rising energy prices threaten Poway troupe=20 SD Union Wed 6/6: Fair to use generators for midway attractions LA Times Wed 6/6: 'Hi My Name Isn't Justice Honey' and Shame on Lockye= r =20 (Editorial) LA Times Wed 6/6: U.S. Probes Alleged Pact Not to Build New Plants Power:= =20 Justice officials focus on Southland operations of two firms which deny=20 wrongdoing LA Times Wed 6/6: Natural Gas Power Prices Drop Sharply Energy:=20 More conservation mild weather are among factors keeping costs down exper= ts=20 say LA Times Wed 6/6: The State Utility Averts $1 Billion in Costs Courts:=20 PG&E and Cal-ISO agree to recognize Department of Water Resources as=20 purchaser of the power SF Chron Wed 6/6: Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited SF Chron Wed 6/6: San Jose council gives green light to generating plant= =20 VOTE REVERSAL: Officials pressured to OK project SF Chron Wed 6/6: Developments in California's energy crisis SF Chron Wed 6/6: California conserves SF Chron Wed 6/6: L.A. power customers awash in cheap energy SF Chron Wed 6/6: PG&E doesn't want to pay for energy to avert blackouts Mercury News Wed 6/6: Metcalf plant gets preliminary approval=20 OC Register Wed 6/6: Feds probe AES Williams Individual.com (PRnewswire) Wed 6/6: Calpine Begins Construction of=20 Peaking Energy Center in Gilroy Calif.=20 Individual.com (PRnewsire) Wed 6/6: Reliant Urges FERC to Drop or Amend= =20 California Price Caps to Avoid Additional Shortages and More Blackouts Energy Insight Wed 6/6: Farm-fresh biopower --- Businesses vie for blackout exemptions: The PUC must decide who should be= =20 spared and the applicant list is very long. By Carrie Peyton and Dale Kasler Bee Staff Writers (Published June 6 2001)=20 Mixes for milkshakes and frozen coffees could spoil at ice cream parlors= =20 sickening customers.=20 Seniors getting their hair done would have to leave their dryers and go hom= e=20 with wet heads risking a chill.=20 Mall escalators could come to a sudden halt endangering shoppers who lose= =20 their footing.=20 Those are among the health and safety risks cited by more than 10000=20 businesses and government bodies asking state regulators to exempt them fro= m=20 rolling blackouts.=20 It is a list that mixes nursing homes and grocery stores outpatient surgic= al=20 clinics and beauty salons dialysis centers and country clubs.=20 A lot of people are treating this like a lottery said Subodh Medhekar of= =20 Exponent Inc. the consulting firm sorting through exemption requests for t= he=20 state Public Utilities Commission.=20 For many Medhekar said the rationale seems to be 'I'm pretty sure I won= 't=20 get exempted but what's the down side? Let's put in an application.' =20 Amid predictions that Californians could face dozens of rolling blackouts= =20 this summer state regulators are trying to update a decades-old list of wh= o=20 should be spared if the lights go out.=20 The Alta Sierra County Club in Grass Valley should be among those whose pow= er=20 stays on Sean O'Brien the club's golf course superintendent told=20 regulators in a nine-page application.=20 The country club telephones could go out making it harder to phone for hel= p=20 if someone has a medical problem while golfing he said in an interview.=20 And if the golf course's irrigation pumps shut down it would lose the=20 ability to quell small blazes -- leaving it to rely on a fire station O'Bri= en=20 said is about one-quarter mile away.=20 Placerville Dialysis wants an exemption too. As many as a dozen people the= re=20 can be having their blood pumped through an artificial kidney that cleans i= t=20 when their own kidneys no longer function properly.=20 When the power goes out everything just stops said manager Shirley=20 Carpenter. There is a way to manually return the blood by hand before it= =20 clots in the line. ... It would just be hectic.=20 It takes about five minutes of manual pumping to fully disconnect someone= =20 from a dialysis machine Carpenter said. And some patients can help by=20 operating their own pumps.=20 But she said I'm sure it would be kind of frightening to have your blood= =20 out in the line and the power off and they're pretty much tied to the=20 machine.=20 Pam Chin a hairdresser at the Loomis Beauty Salon said the owner sought a= n=20 exemption because people could get overheated if the air conditioning went= =20 out and older customers getting their hair set could be chilled if the=20 dryers shut off.=20 With about half the state already exempt from rolling blackouts the questi= on=20 of who else should stay connected has become a delicate one for utilities= =20 regulators and legislators.=20 Carl Wood the PUC commissioner who has taken the lead on blackout issues= =20 estimates that fewer than 1000 more utility customers can be exempted befo= re=20 they overload the rolling outage system designed to take stress off the=20 electric grid.=20 While about 6000 customers are classified as essential by the state's tw= o=20 largest utilities keeping them out of the blackout rotation also spares=20 about 5 million other customers who are served by the same circuits.=20 That multiplier effect will have to be weighed by the consulting firm by= =20 utilities and eventually by PUC commissioners who are scheduled to vote in= =20 early August on who should be added to existing standards.=20 The rules will apply to the state's investor-owned utilities Pacific Gas a= nd=20 Electric Co. Southern California Edison and San Diego Gas & Electric Co.= =20 but not to municipal utilities.=20 The Sacramento Municipal Utility District already rejected pleas for specia= l=20 exemptions from a medical lab a veterinary hospital nursing homes medica= l=20 facilities businesses and residents. SMUD believes they can weather=20 blackouts because they are not critical to public safety.=20 People have counted on having dependable electricity for so long that some= =20 have widely varying ideas of who can do without it safely Medhekar said.= =20 Of the more than 500 Baskin Robbins ice cream parlors that dot California= =20 only five are listed on the PUC Web site as applicants for exemptions.=20 The site cautions that its list of 9239 electronic applicants hasn't been= =20 checked for duplicates -- or fiction. It includes hundreds of outlets of th= e=20 same drug store and supermarket chains dozens of related nursing homes and= =20 more than 400 dentists. Another 1200 commercial power users have applied b= y=20 fax.=20 Among those who have confirmed they want out of outages are the grocery=20 chains operated by West Sacramento-based Raley's which said it took the=20 action as part of united effort with all California grocers who are worrie= d=20 about food spoilage.=20 Others in the mix are Fairfield's Westfield Shoppingtown Solano formerly t= he=20 Solano Mall where officials sought the exemptions out of fear that shopper= s=20 would get injured if escalators came to a sudden halt.=20 The Yolo County Housing Authority asked for an exemption on behalf of its 7= 00=20 dwellings in the belief that the utilities offer exemptions for low-income= =20 Californians Executive Director David Serena said.=20 Serena added that many of the authority's occupants are older or disabled a= nd=20 could be endangered by a blackout.=20 Chevron Corp. acknowledged it couldn't show that a blackout at its refineri= es=20 would present imminent danger to public health or safety but it asked Go= v.=20 Gray Davis to support legislation exempting makers and transporters for=20 critical fuels saying a refinery shutdown would cut into the state's=20 gasoline supply.=20 Some businesses acknowledged that their applications are a long shot.=20 It's probably a stretch said Amanda Leveroni who owns Bacio Catering Co= .=20 of Chico about her request to the PUC. The public wouldn't be in danger.= =20 But we're a catering company -- somebody has planned for a year-plus for a= =20 wedding or some big event she added. I would be in such a huge situation= .=20 I'd have to send out for pizza.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com. PG&E ISO agree to court order on power bills By Claire Cooper Bee Staff Writers (Published June 6 2001)=20 SAN FRANCISCO -- Pacific Gas and Electric Co. and the operator of=20 California's power grid agreed Tuesday to a preliminary court order providi= ng=20 that the utility will continue to receive -- but not pay -- generators' bil= ls=20 for the state's purchases of the most expensive wholesale electricity.=20 The tab has been running at about $300 million a month.=20 The order which U.S. Bankruptcy Judge Dennis Montali said he'll sign will= =20 specify that the Independent System Operator will not procure power except= =20 for a creditworthy buyer who has agreed to pay the generator.=20 In California the only such potential buyer is the state Department of Wat= er=20 Resources. However the department which has avoided PG&E Co.'s bankruptcy= =20 proceedings by claiming sovereign immunity will not be controlled by the= =20 agreement. Montali pointed out that the department still could demand=20 reimbursement from PG&E.=20 Under the agreement the ISO will not press any claims against PG&E on beha= lf=20 of generators if they are not paid.=20 The proposed preliminary injunction was based on an April order by the=20 Federal Energy Regulatory Commission which forbade the ISO from purchasing= =20 power on behalf of any non-creditworthy buyer such as PG&E.=20 The ISO is appealing the FERC order. If the appeal succeeds the injunction= =20 will end.=20 Peter Schrag: Turning up the heat in Houston and Washington (Published June 6 2001)=20 Behind all the palaver about the predictable standoff at last week's energy= =20 summit between President Bush and Gov. Gray Davis one major political=20 development was missed.=20 Put simply in the past month the focus of the California energy crisis an= d=20 maybe the onus as well has moved east: from the state's (and Davis')=20 handling of the mess to the generating companies energy marketers and gas= =20 pipeline companies that have richly profited from it and thus to FERC the= =20 do-next-to-nothing Federal Energy Regulatory Commission and the Bush=20 administration.=20 That wasn't all Davis' doing -- far from it -- though it's been at the hear= t=20 of his message about energy industry pirates and profiteers. Bush's=20 misbegotten energy plan and the administration's political clumsiness also= =20 contributed mightily not least by inadvertently giving Davis the chance to= =20 get media exposure he could only have dreamed about.=20 More important there's the defection of Sen. James Jeffords from the=20 Republican Party and the resulting shift of control in the U.S. Senate whe= re=20 the next chair of the Energy Committee will be Sen. Jeff Bingaman of New=20 Mexico a co-sponsor of Sen. Dianne Feinstein's bill capping wholesale=20 electric rates for the next two years. And chairing the Committee on=20 Governmental Affairs will be Sen. Joseph Lieberman of Connecticut who's=20 already asked for an audit of energy prices.=20 Those changes will draw a lot more attention to recent studies showing that= a=20 handful of big generators -- Duke Power Reliant Mirant Dynegy and the hu= ge=20 energy-marketing firm Enron -- have gamed the market to drive wholesale=20 prices to levels that in the year 2000 sometimes reached 40 times the=20 prices of the year before.=20 The findings come not merely from economists at the California Independent= =20 System Operator the agency that manages the state's grid who estimate=20 overcharges resulting from market power at $6.2 billion for last year alone= .=20 They come also from Severin Borenstein and his colleagues at the University= =20 of California Energy Institute who conservatively calculate the=20 overcharges at $4.5 billion from Paul Joskow a widely respected energy=20 economist at MIT and from Edward Kahn an economic analyst in San Francisc= o.=20 In a recent paper published by the National Bureau of Economic Research=20 Joskow and Kahn conclude that there's considerable evidence that the high= =20 prices experienced in the summer of 2000 reflect the withholding of supplie= s=20 from the market by suppliers [generators or marketers] exercising market=20 power. That those high prices occurred not merely during peak usage but al= so=20 at off-hours when no one had ever seen a price spike before makes those= =20 spikes even more curious.=20 There is in addition the powerful suspicion that the huge increase in=20 natural gas prices that a subsidiary of El Paso Energy Co. now the largest= =20 gas company on Earth was charging on the California side of the=20 California-Arizona border wasn't merely the result of an innocent imbalance= =20 between supply and demand.=20 None of that may be illegal. If there's no collusion there are no violatio= ns=20 of antitrust laws. But it adds plenty of steam to the political argument. I= n=20 the 2000 election cycle alone energy companies kicked in some $64 million = in=20 political contributions 75 percent of it to Republicans. At a time when=20 those companies many of them located in the same Houston neighborhood are= =20 racking up astronomical profits and when their collective coziness with Bus= h=20 and the Republican Party is a lot more than rhetoric their vulnerability t= o=20 a vigorous Senate investigation ought to be obvious.=20 The clincher is Blackout a Frontline program that both symbolizes the= =20 shifting emphasis and reinforces it. (The program is scheduled to be aired = at=20 8 p.m. Friday on Sacramento cable Channel 7.) It isn't another recital of= =20 Californians worrying about their electric bills or about the stupidity of= =20 the state's deregulation scheme or how Davis dithered in addressing the=20 crisis. It is about those generators and marketers in Houston and North=20 Carolina men (and a few women) who regard themselves as the heroes of the= =20 new energy markets.=20 The piece is reported by Lowell Bergman who in working for both Frontline= =20 and the New York Times has already broken major print stories about Duke=20 Power's secret approach to Davis offering unspecified energy refunds in=20 return for an end to state investigations and lawsuits. Bergman also report= ed=20 private conversations between Enron chairman Kenneth Lay a major Bush=20 supporter and FERC chairman Curt Hebert regarding the influence that Lay= =20 could exercise with Bush to allow Hebert to keep his chairmanship if Hebert= 's=20 supported certain decisions Enron badly wants.=20 None of these recent events is likely to end Davis' political woes and the= y=20 may not produce the wholesale rate caps Feinstein wants and that most=20 economists think necessary -- or maybe any significant reduction in the=20 industry's predatory pricing. But they will surely help turn up the heat= =20 both in Houston and Washington. Six months ago FERC found wholesale prices= =20 were not fair and reasonable as federal law requires but did little abou= t=20 them. It will now have a lot more questions to answer.=20 Peter Schrag can be reached at Box 15779 Sacramento CA 95852-0779 or at= =20 pschrag@sacbee.com. Is trading an insider's game?=20 Buying selling of electricity is a growth business but some say deck is= =20 stacked against consumers By Craig D. Rose=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 While Californians decry deregulation's failure to deliver a competitive=20 market electricity wholesalers have quietly developed a vast and rapidly= =20 growing business of buying and selling power among themselves.=20 The deals take place on high-tech trading floors in Houston and elsewhere= =20 around the country as well as on Internet-based trading systems.=20 Some experts say this electricity trading is a key mechanism for raising=20 consumer power prices yet it's largely unregulated.=20 Electricity trading is like buying stock -- when you have ability to chang= e=20 the stock price said Frank Wolak a Stanford University economics profess= or=20 and member of the state grid operator's market surveillance group.=20 Energy companies say the buying and selling of contracts to deliver power= =20 provides risk management allowing plant owners to presell their electricit= y=20 lock in prices and avoid fluctuations. The rough and tumble of the free=20 market they add is the most efficient means of allocating a resource like= =20 electricity.=20 But industry critics say trading is far from a competitive market paradigm.= =20 In their view it's a means of communication -- a way for energy insiders t= o=20 collude and raise prices under the guise of competition.=20 To be sure the trading arms of major energy companies have emerged as star= s=20 in an industry where profit surges of 300 percent or 400 percent are not=20 uncommon.=20 The transactions shrouded in secrecy can leave ownership of a critical=20 commodity in unknown hands. Consider the case of power generated by AES=20 Corp.'s California plants.=20 In 1998 AES made a bold move. Immediately after purchasing power plants th= at=20 gave it control of 10 percent of the state's electric generating capacity= =20 the company sold the output from its plants for the next 20 years to Willia= ms=20 Cos.=20 Williams did not sit on this treasure trove of electrons. The Tulsa Okla.= =20 company soon sold 80 percent of what it bought.=20 It is difficult to say who owns that power now. Some might be owned by Semp= ra=20 Trading a sister company of SDG&E. Or some could be owned by Enron Corp.= =20 the nation's biggest electricity trader.=20 A spokeswoman for Williams conceded that Williams itself may have repurchas= ed=20 some of the electricity it sold earlier. But trading companies closely guar= d=20 their positions.=20 This much can be said with certainty: Electricity that AES sold for less th= an=20 5 cents per kilowatt-hour to Williams changed hands perhaps 10 times in the= =20 wholesale market and emerged at times in recent months with a price tag for= =20 consumers that was 300 percent higher.=20 Williams' trading profits increased by 523 percent in the first quarter thi= s=20 year. Advance sales All this buying and selling creates curious confluences.=20 In their attempt to deflect criticism over high prices generating companie= s=20 such as Duke Energy -- operator of the South Bay Power Plant in Chula and= =20 others in the state -- frequently note that they sell most of their=20 electricity far in advance. But they acknowledge less often that their=20 trading units may also be buying power which could boost the company's=20 electricity inventory.=20 Duke was the fourth biggest electricity trader last year and cited its=20 trading activity as a prime contributor to its wholesale business profits= =20 which soared 324 percent in the first quarter to $348 million.=20 It is a company's power traders who frequently direct plant operators to=20 increase or decrease the generation of power in response to market=20 conditions.=20 Energy companies have little option but to turn to trading for profits. One= =20 of the better kept secrets of electrical deregulation and its promise of=20 competition is that there is remarkably little competition in the productio= n=20 side of the business.=20 For one thing electricity is a commodity power from one company is=20 indistinguishable from that generated by others.=20 More important nearly all modern plants generate power from turbines built= =20 by a handful of manufacturers. The result? Modern plants owned by different= =20 companies produce power at nearly identical cost.=20 The cost of power produced by modern plants is all within a mil=20 (one-thousandth of a dollar) said Michael Peevey an adviser to Gov. Gray= =20 Davis and former president of Southern California Edison.=20 So the extraction of profit in the electricity business relies much more on= =20 trading. Traders' profits rise when prices are volatile -- plunging or eve= n=20 better rising sharply. Little regulation But despite the obvious temptation to manipulate the market the burgeoning= =20 electricity trading business has remained largely unregulated.=20 The Federal Energy Regulatory Commission does require quarterly filings fro= m=20 energy traders but these often provide incomplete information or at least= =20 little that has been of concern to FERC.=20 In fact although the trading of electricity grew more than a hundredfold= =20 from 1996 to 2000 FERC has taken no major enforcement action against a=20 trader. After the onset of the California crisis last year FERC has acted= =20 once. That was against Williams which agreed to pay $8 million without=20 admitting guilt to resolve an allegation that it withheld supply to pump up= =20 prices.=20 FERC's record of enforcement in the area of power trading stands in contras= t=20 to a long list of enforcement actions within other markets taken by the=20 Securities Exchange Commission and the Commodity Futures Trading Commission= .=20 FERC has recently added staff to its market oversight operations. But Willi= am=20 Massey a FERC commissioner says the agency's effort is still inadequate.= =20 Electricity can be flipped stripped and chopped up Massey said. It's a= n=20 extraordinarily complicated market.=20 The sophisticated marketers and traders have simply moved past us. We're= =20 kind of horse and buggy in our approach and they're out there in rocket shi= ps=20 flying around ... The problem is that sophisticated traders don't necessari= ly=20 produce reasonable prices. They produce profits.=20 Before deregulation electricity trading was a low-key affair. Regulated=20 utilities dealt power back and forth on a reciprocal basis to fill=20 electricity shortfalls in their control areas. There was little trading for= =20 profit until the mid-1990s after federal legislation and FERC rulings open= ed=20 the market.=20 Major traders include large energy companies sister companies of=20 California's major utilities and Wall Street firms. Market volatility In many ways the trading of power is similar to that of other commodities.= =20 But there are important differences. Because it cannot be stored and its us= e=20 is so fundamental the price of electricity is the most volatile of all.=20 When supplies are tight a single supplier can rapidly raise prices to=20 budget-busting levels as evidenced by Duke Energy's recent admission that = it=20 charged California nearly $4000 for a megawatt-hour of power a quantity= =20 that probably sold hours earlier for one-tenth of that sum or less.=20 Wolak the Stanford economist and state Sen. Joseph Dunn D-Garden Grove= =20 who is investigating the state power market say trading allows companies t= o=20 collude under the guise of competition. Instead of wringing out lowest cost= s=20 the wholesale trading market serves to raise prices they say.=20 As I trade to you and you trade to me we communicate to each other what= =20 price we would like to get said Wolak. It's not collusive. It's just=20 communicating price.=20 Mark Palmer a spokesman for Enron the nation's biggest power trader said= =20 California's problem is not the result of trading.=20 It's a result of shortages Palmer said.=20 Underscoring its emphasis on trading Enron's new headquarters tower in=20 downtown Houston rises from a six-story block of new trading floors=20 including expanded space for electricity trading.=20 Enron also pioneered trading in cyberspace and its Enron Online site claims= =20 to be the most active computer-based trading market.=20 The Houston company argues that consumers won't fully benefit from power=20 trading and deregulation until they have greater choice in choosing their= =20 power supplier. And the company says FERC has not done enough to open acces= s=20 to transmission lines which would allow traders to move power around the= =20 country. To that end Enron has lobbied hard for President Bush's plan for = a=20 national electricity grid.=20 Palmer says the notion that the price of electricity rises each time it is= =20 traded is mistaken.=20 The market is always looking for the real price of a commodity Palmer=20 said.=20 Dunn the California state senator says his investigation found a differen= t=20 function for trading. At a time when supply barely meets or falls short of= =20 demand he noted companies with electricity to sell have to worry only abo= ut=20 how high to set their price.=20 The trader is a pawn in the generator's game to drive up prices said Dun= n.=20 Trading develops a level of trust. You my alleged competitor will bid in= =20 the same patterns and I will respond not in a competitive pattern but in a= =20 complimentary pattern.=20 The state senator said his investigation found evidence that on several day= s=20 energy companies appeared to test their ability to drive prices up without= =20 being undercut by competitors.=20 This ability to drive up prices without competitive consequence is a key te= st=20 of market power the technical term for manipulation or price fixing.=20 But Dunn also conceded that antitrust violations can be hard to prove in=20 court. He suggested that even if the trading behavior falls short of=20 antitrust violations it remains anti-competitive and devastating for the= =20 California economy.=20 To Harry Trebing a utility industry expert and professor emeritus at=20 Michigan State University wholesale electricity trading is reminiscent of= =20 what took place in the 1920s and early '30s. Back then utility companies= =20 created complex networks of holding companies that traded stock among=20 themselves driving up prices in the process.=20 Undoing that scheme was a focus of President Franklin Roosevelt's=20 administration. Congress ended up barring national power companies and=20 tightening regulation of utilities in an effort to counteract their tenden= cy=20 to create markets that work only for insiders.=20 The broad goals of trading are the same Trebing said.=20 The goal is to maximize profits through raising prices.=20 Daily energy costs for state fall in past weeks=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 SACRAMENTO -- In some of the first good news of the electricity crisis the= =20 Davis administration said yesterday that the daily cost of power purchased = by=20 the state for utility customers has dropped in recent weeks.=20 The price-drop news comes after an announcement that Californians conserved= =20 more energy than expected last month 11 percent and amid Davis=20 administration optimism that the Legislature may finally begin to move on a= =20 plan to keep Southern California Edison out of bankruptcy.=20 The developments if they turn out to be a trend and not temporary could b= e=20 among the first signs that Gov. Gray Davis' plan to end the electricity=20 crisis is beginning to work. But the administration isn't saying that.=20 We have had a few good days here lately said S. David Freeman a Davis= =20 power adviser. I don't think that I want to project.=20 Some power-market watchers began to speculate last month that prices may ha= ve=20 peaked earlier this year. Platts an energy information service said=20 yesterday that spot prices for the natural gas used by power plants are=20 falling this month.=20 The governor's press secretary Steve Maviglio told reporters yesterday th= at=20 the daily amount spent on power is now well below $50 million which was= =20 the average cost earlier this year.=20 A 12-day gap in the most recent notice to the Legislature that another $500= =20 million increment will be spent on power suggests that the daily average=20 during the last two weeks may have dropped down around $42 million.=20 Oscar Hidalgo a spokesman for the state power purchasing agency said that= =20 the average cost of power was under $40 million during the first four days = of=20 this month.=20 Maviglio attributed the lower cost to conservation the phasing in of cheap= er=20 long-term power contracts fewer power plants off-line for maintenance and= =20 cooler weather.=20 However he said The average cost is still way over what we paid last=20 year.=20 There was widespread skepticism in late April when the governor's consultan= ts=20 predicted that the $346 per megawatt-hour average paid by the state for=20 non-contracted power from April through June would drop to an average of $1= 95=20 from July through September.=20 We are still very comfortable with the projection that Mr. Fichera and=20 company estimated Maviglio said referring to Joseph Fichera of Saber=20 Partners in New York.=20 During a briefing on May 21 Fichera told reporters that the amount of powe= r=20 that the state would obtain under long-term contracts for May was expected = to=20 be about 43 percent of the total required the so-called net short.=20 Fichera said contracts already signed were expected to cover 66 percent of= =20 the net short in June 48 percent in July and 42 percent in August. He sai= d=20 contracts that had been agreed on in principle could increase those amounts= =20 to 73 percent in June 67 percent in July and 60 percent in August.=20 We are still on target. There are risks Fichera said yesterday among th= em=20 extended hot weather and power plant outages. No one is popping the=20 champagne corks until Sept. 30.=20 The governor's consultants based their forecast of power demand this summer= =20 on an estimate that Californians will reduce their electricity use by 7=20 percent.=20 The 11 percent reduction last month as compared to May of last year came= =20 before the sticker shock of rate hikes that begin this month for customers = of=20 Edison and Pacific Gas and Electric. And a $35 million ad campaign urging= =20 conservation has not hit full stride.=20 Maviglio said the administration plans to release some detailed information= =20 on Monday about the roughly $8 billion the state has spent buying power. Th= e=20 general fund will be repaid by a bond of up to $13.4 billion that ratepayer= s=20 will pay off over 15 years.=20 Legislative leaders have demanded detailed information about power purchase= s=20 before proceeding with the Edison plan. Assembly Democrats are working on a= =20 plan that de-emphasizes state purchase of the Edison transmission system an= d=20 would put most of the burden for paying off Edison's debt on businesses and= =20 large users not residences. Five tiers sought in proposed rate boost=20 Conservation would be promoted SDG&E says By Karen Kucher=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 A proposed rate increase for SDG&E customers to cover the high cost of=20 electricity should be imposed in five tiers to encourage conservation the= =20 company is advising state utility regulators.=20 The more electricity a customer uses the higher the rate would be.=20 SDG&E needs to raise its rates to bring in an additional $502 million=20 annually to pay the state for power purchases.=20 The state Public Utilities Commission is expected to rule on San Diego Gas = &=20 Electric's rate-increase proposal June 28.=20 The rate changes would remove a cap that has shielded most SDG&E customers= =20 from rising electricity prices for a year. The cap enacted by state=20 lawmakers in September 2000 and retroactive to June 2000 set rates at 6.5= =20 cents per kilowatt-hour.=20 Higher rates would mean the average SDG&E residential and small-business=20 customer's electricity bills would go up by 18 percent. Large commercial=20 users' bills would average 29 percent more.=20 Public hearings on the issue will be held next Monday and Tuesday in San=20 Diego El Cajon Escondido and San Clemente. These sessions will focus on= =20 small-business and residential consumers. Hearings on large commercial user= s=20 were held last month.=20 Earlier this year the PUC decided to allow the state's two largest=20 utilities Pacific Gas and Electric and Southern California Edison to char= ge=20 customers an extra $5.7 billion annually for electricity.=20 The state Department of Water Resources which has been buying power for=20 SDG&E customers since February asked SDG&E to generate a total of $915=20 million annually to cover the cost of electricity purchases.=20 With the proposed rate increases SDG&E could do that.=20 Large commercial customers would pay about 30 percent of the overall increa= se=20 and residential and small-business customers would pay about 70 percent sa= id=20 Ed Van Herik a spokesman for the utility company.=20 If the increase can be tiered as many as 60 percent of residential custome= rs=20 will see no rate increase if their electricity usage remains the same Van= =20 Herik said.=20 But customers who use more than 130 percent of their baseline -- considered= =20 the minimum amount of electricity needed by a household -- will be billed a= t=20 increasingly higher rates.=20 Residential and small-business customers who use a lot of electricity could= =20 pay as much as 17.89 cents per kilowatt hour for some power they consume.= =20 Consumer advocate Michael Shames said he is concerned the utility's proposa= l=20 does not spread the increases evenly among different types of users. He als= o=20 called for more scrutiny of the state's request.=20 People should tell PUC officials that this increase should not be a carte= =20 blanche or blank check approval said Shames the head of Utility Consumer= s'=20 Action Network. The PUC needs to ensure that the rate increase requested b= y=20 the (state) is reasonable.=20 The public hearings are scheduled for:=20 ?Monday 1 p.m. San Diego Concourse Copper Room 200 C St. San Diego.=20 ?Monday 7 p.m. El Cajon Community Center 195 E. Douglas Ave. El Cajon.= =20 ?Tuesday 1 p.m. Country Inn Hotel 35 Via Pico Plaza San Clemente.=20 ?Tuesday 7 p.m. Center for the Arts 340 N. Escondido Blvd. Escondido.= =20 Port budget large but power bills loom=20 Slowing economy also cause for worry By Ronald W. Powell=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 The rock is rolling financially but there are indications that the blues= =20 lurk on the horizon.=20 Officials of the San Diego Unified Port District -- headquartered in a=20 block-shaped building some employees call the rock -- are happy with a=20 projected 2001-2002 budget that is 5.1 percent larger than the current one.= =20 Total revenue is expected to reach $208.7 million $10.2 million above what= =20 is expected in the fiscal year that ends June 30.=20 Port commissioners gave preliminary approval to the budget yesterday and ar= e=20 scheduled to take a final vote July 10.=20 But a slowing economy and surging electric bills are causes for concern.=20 Electricity costs are expected to rise from $5 million to $8.2 million in t= he=20 coming fiscal year.=20 As far as trends we see a continuation of the growth we've experienced ov= er=20 the past five years said Bruce Hollingsworth the port's treasurer. But= =20 our percentage of growth will not rise as sharply.=20 Port revenues have grown steadily since the 1997-1998 fiscal year when $16= 3=20 million was generated.=20 The proposed budget calls for adding 24 employees to the port's 730-member= =20 work force. New hires will include three Harbor Police officers 10 employe= es=20 in the aviation division and four in maritime services.=20 The port operates Lindbergh Field and administers nonmilitary tidelands alo= ng=20 San Diego Bay. It is landlord to more than 600 waterfront businesses and=20 operates two marine cargo terminals and one cruise ship terminal.=20 The budget calls for growth in each of the port's primary revenue centers:= =20 aviation real estate and maritime services.=20 Passenger and cargo activity at Lindbergh Field is expected to generate $90= .7=20 million or $5 million more than expected in the current year. Most of that= =20 increase is expected to come from parking-rate increases at the airport and= =20 at the port's long-term parking lot on Pacific Highway.=20 Rent from hotels and other businesses that are port tenants are expected to= =20 total $63.1 million up $1.8 million from the current budget.=20 Increases in cargo and cruise ship traffic are expected to boost maritime= =20 income by $2.7 million to a total of $18.4 million.=20 The port expects to spend $157 million on construction projects. They inclu= de=20 $8.5 million to relocate the General Services Department from Eighth Avenue= =20 and Harbor Drive in San Diego to National City and more than $5 million for= =20 paving and improvements at the 10th Avenue Marine Terminal.=20 Rent revenue could grow substantially in future years. Four hotel projects = on=20 port property have won approval or are seeking it.=20 Jim Bailey president of Manchester Resorts told commissioners yesterday= =20 that he expects to break ground on a second Hyatt tower of 750 rooms by Jun= e=20 26. Port officials said revenue from that hotel would bring in an additiona= l=20 $3.7 million a year. It is scheduled to open in the summer of 2003.=20 Hollingsworth the treasurer said that if all four hotels are built the po= rt=20 could receive as much as $15 million a year in new revenue.=20 Continuous use urged for planned power plant=20 Escondido facility originally proposed for peak demand By Jonathan Heller=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 ESCONDIDO -- A proposed power plant in southwest Escondido that initially w= as=20 expected to run only during times of peak electricity demand probably will = be=20 allowed to run full time.=20 A state energy official who recommended approval of the plant yesterday has= =20 said the plant could operate as often as the state deems necessary.=20 The California Energy Commission was scheduled to vote on the project today= .=20 CalPeak Power of San Diego has asked the commission to approve a 49-megawat= t=20 plant on Enterprise Street near Vineyard Avenue. Referred to as a peaker= =20 plant such facilities typically are designed to supply energy only during= =20 times of peak demand.=20 The state limits the number of hours some plants can operate to keep=20 pollution at a minimum. A 44-megawatt peaker plant being built on West=20 Mission Avenue in Escondido by Ramco Inc. will be allowed to operate no mor= e=20 than 16 hours per day.=20 That plant is permitted to emit up to 5 parts per million of nitrogen oxide= =20 although its actual emissions are expected to be slightly lower said Dale= =20 Mesple a Ramco consultant. Nitrogen oxide is a component of smog.=20 The CalPeak plant if approved would be restricted to 2 parts per million = of=20 nitrogen oxide.=20 It was generally assumed that the CalPeak plant would operate under similar= =20 time restrictions as the Ramco plant. The potential for air pollution was= =20 among the chief concerns of residents who spoke at the City Council hearing= s=20 on the Ramco project and at the energy commission hearings about the CalPea= k=20 plant.=20 But under the terms of approval recommended by Energy Commission Chairman= =20 William Keese CalPeak's plant would be able to operate up to 8760 hours= =20 per year typically when the demand for electricity is high. That number= =20 equals 24 hours a day.=20 The actual number of hours would depend on the requirements of the state's= =20 Independent System Operator which manages the energy grid.=20 We certainly want to have the flexibility to run whenever we're needed= =20 said Mark Lyons CalPeak's development director. Exactly how often we will= =20 run is anybody's guess.=20 Escondido Councilwoman June Rady said she was frustrated by the possibility= =20 of the plant running full time. In Ramco's case the city and the county Ai= r=20 Pollution Control District made it clear how often the plant could operate.= =20 CalPeak chose to bypass the city's permitting process and went through the= =20 state Energy Commission which offers an expedited 21-day approval put in= =20 place by Gov. Gray Davis as an emergency measure.=20 I think Escondido has been absolutely ignored and there's a total lack of= =20 due process Rady said. It boils down to an issue of local control.=20 Although city officials objected to the commission pre-empting the city's= =20 land-use authority the commission maintained that Davis' order gave it the= =20 final say on this type of project.=20 If the commission gives final approval today the only remedy available to= =20 the city would be in court. At least three council members must vote to=20 initiate legal action.=20 Keese's recommended approval did take into account several city concerns=20 regarding landscaping. The CalPeak plant would be built near the entrance o= f=20 a planned high-tech business park and city officials were worried the=20 plant's appearance might hinder the ability to attract high-quality tenants= =20 to the park.=20 Mayor Lori Holt Pfeiler said she was not surprised by the commission's=20 recommendation.=20 I expected they would want to approve the project and that's why it was= =20 important for the city to weigh in with conditions we have in this=20 community Pfeiler said.=20 Rising energy prices threaten Poway troupe=20 By Brian E. Clark=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 POWAY -- Rising electricity rates may extinguish the stage lights this summ= er=20 for the Poway Performing Arts Company.=20 I'm afraid that if SDG&E gets the price increase it's asking for -- from 6= .5=20 cents per kilowatt-hour to 8.9 cents -- that we'll go under said Kathy=20 McCafferty spokeswoman for the nonprofit theater.=20 The volunteer organization produces its plays in a building at a Poway Road= =20 shopping center. It held three fund-raising performances over the weekend= =20 but officials were uncertain yesterday how much money was raised.=20 The group is not affiliated with the Poway Performing Arts Center and has= =20 been in business for 20 years.=20 McCafferty said the group built up a $2000 surplus last summer before ener= gy=20 prices began to surge.=20 That $2000 was a big reserve for us she said. It seemed like a ton of= =20 money but boy it went fast. And we're really energy-dependent. Our light= s=20 use a lot of power. And we're in Poway on the second floor of our building.= =20 It gets hot here and we have to use air conditioning.=20 But McCafferty acknowledged that the cost of power isn't the group's only= =20 problem.=20 In a recent letter to backers President Nan Katona said the organization= =20 also needs new blood to keep operating.=20 The truth is that lack of funding is just a symptom of the deeper problem= =20 which is lack of community support she wrote. Ironically audiences and= =20 reviewers recognize the Poway Performing Arts Company as one of the premier= =20 community arts theaters in San Diego.=20 Katona said some new volunteers had stepped forward to take leadership role= s=20 in the theater company since she wrote her letter last month. But she said= =20 rising electricity prices could still bring the group down.=20 If our energy bills double or triple we could be in dire straits she=20 said. It could push us over the edge financially.=20 McCafferty said it would be difficult for the theater to cut costs.=20 We can't run a much leaner operation she said. If our power prices go u= p=20 again we may still be forced out of business.=20 The theater is at 13250 Poway Road in the Lively Shopping Center. For more= =20 information call (858) 679-8085.=20 Fair to use generators for midway attractions=20 By Michael Burge=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 DEL MAR -- The Del Mar Fair will generate its own electricity for thrill=20 rides on the midway this year instead of using energy from SDG&E.=20 In case there are planned or unplanned outages we still will be operating= =20 fairgrounds General Manager Timothy J. Fennell said.=20 Fennell decided to put the midway on generators because he didn't want the= =20 fairgrounds pulling power from the grid while county residents are coping= =20 with rolling blackouts at home and at work he said.=20 And the fair does not want to take a chance that a rolling blackout will=20 leave some people stranded in rides high above the grounds forcing an=20 evacuation.=20 The fairgrounds has been told it is exempt from rolling blackouts but rath= er=20 than take such a risk it will rent 13 diesel-fuel generators and produce=20 electricity on the midway. The rest of the fairgrounds will use power from= =20 San Diego Gas & Electric Co.=20 Fairgrounds operations manager Larry Baumann estimated it would cost the=20 fairgrounds $20000 more to generate its own electricity than to buy it fro= m=20 SDG&E.=20 Midway manager Donna Ruhm said it will be worth it.=20 Rides that require evacuation have to have backup power and they do Ruhm= =20 said. Now our service won't be interrupted.=20 It is not unusual for carnivals to generate their own power and the=20 fairgrounds has done so in the past. Fair officials removed the generators = 10=20 to 15 years ago to reduce noise on the midway.=20 The fair opens June 15 and ends July 4.=20 While the rest of the fairgrounds is on the SDG&E grid Baumann said backup= =20 generators can kick in during a typical 60-or 90-minute blackout allowing= =20 the fair to operate without serious difficulty. Those generators are not=20 linked to the midway.=20 All the generators are licensed by the state and meet emission standards= =20 fair officials said so they do not expect the noise and odor to be=20 excessive.=20 The fairgrounds is taking the precaution of providing its own power despite= =20 the fact that it probably will not go dark during a rolling blackout.=20 SDG&E has assured me that .?.?. the fairgrounds and the racetrack will not= =20 be on the curtailment (blackout) list during the fair and the races said= =20 Del Mar Fire Chief Jack Gosney.=20 The Del Mar Thoroughbred racing season begins July 18 and ends Sept. 5.=20 Gosney said SDG&E told him earlier this year that the fairgrounds was not= =20 subject to a forced outage because it shared a circuit with the Del Mar Fir= e=20 Station which is a 911 dispatch center and exempt from a blackout. But he= =20 said recent research showed that the fairgrounds is on a separate circuit.= =20 Nonetheless Gosney said SDG&E is exempting the fairgrounds and racetrack= =20 during the busy summer season.=20 The fairgrounds paid $137152.95 for its electricity usage from March 12 to= =20 April 10. It paid $51845.39 for electricity during the same period last ye= ar. ?=20 Wednesday June 6 2001=20 'Hi My Name Isn't Justice Honey' and Shame on Lockyer=20 By TOM G. PALMER ?????Here's what California Atty. Gen. Bill Lockyer said at a press=20 conference about Enron Corp. Chairman Kenneth Lay: I would love to=20 personally escort Lay to an 8-by-10 cell that he could share with a tattooe= d=20 dude who says 'Hi my name is Spike honey.'=20 ?????Here's why Lockyer should be removed from his office of public trust:= =20 First because as the chief law enforcement officer of the largest state in= =20 the nation he not only has admitted that rape is a regular feature of the= =20 state's prison system but also that he considers rape a part of the=20 punishment he can inflict on others.=20 ?????Second because he has publicly stated that he would like to personall= y=20 arrange the rape of a Texas businessman who has not even been charged with= =20 any illegal behavior.=20 ?????Lockyer's remarks reveal him to be an authoritarian thug someone whol= ly=20 unsuited to holding an office of public trust.=20 ?????But his remarks do have one positive merit: They tell us what criminal= =20 penalties really entail.=20 ?????Contrary to some depictions of prisons as country clubs they are=20 violent and terrible places. More and more politicians propose criminal=20 sanctions for more and more alleged misdeeds and as a result ever more kin= ds=20 of behavior are sanctioned by criminal penalties perhaps now even selling= =20 electricity. Those found guilty of such crimes are put into cages where th= ey=20 are deprived of their liberty and dignity and as Lockyer so clearly=20 acknowledged raped and brutalized. What's worse Lockyer has indicated tha= t=20 he believes that rape is an appropriate part of the system of punishments h= e=20 administers.=20 ?????Should it matter that Lay is a businessman? Imagine the outcry if the= =20 head of Enron were female. What would Lockyer's fellow Democrats have said = to=20 that?=20 ?????Should it matter that Lay is chairman of an electricity generator? Doe= s=20 the nature of his business justify threats to escort him to his own rape?= =20 Lockyer told the Los Angeles Times that he had singled out Enron's chairman= =20 because the Houston-based company is the world's largest energy trader.=20 ?????So apparently singling out a man for a heinous threat is OK because he= 's=20 the chairman of the world's largest energy trading company. That's accordin= g=20 to the man who as a state senator sponsored California's 1984 hate-crimes= =20 law. Evidently the crusader against intimidation on the basis of race=20 religion and sexual orientation feels no hesitation at all about intimidati= ng=20 someone and threatening him with the brutal use of physical force simply=20 because he heads the world's largest energy trading company.=20 ?????Lockyer and Gov. Gray Davis seem to think that the best way to keep th= e=20 lights on is to threaten electricity producers with brute force rather tha= n=20 to offer to pay competitive rates in competitive markets. Are energy=20 producers to blame for California's energy problems? No. Bad policies=20 including rigid controls on retail prices of electricity are the cause of= =20 the problem not the people who generate energy. Scapegoating producers and= =20 threatening them with violence is an old ploy of authoritarians. California= ns=20 should not stand for it.=20 ?????An Enron spokesman said that Lockyer's chilling stated desire to arran= ge=20 the rape of Lay does not merit a response. The spokesman is wrong. Lockyer'= s=20 remarks merit public disgrace and removal from office. After all rape is n= ot=20 a form of legal justice in America--is it?=20 - - - Tom G. Palmer Is a Senior Fellow at the Cato Institute in Washington. E-mai= l:=20 Palmert@cato.org Copyright 2001 Los Angeles Times=20 California Metro Desk=20 U.S. Probes Alleged Pact Not to Build New Plants Power: Justice officials= =20 focus on Southland operations of two firms which deny wrongdoing. MYRON LEVIN NANCY RIVERA BROOKS ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 The U.S. Department of Justice has launched an investigation into whether t= wo=20 companies that control a large swath of Southern California 's electricity= =20 supply agreed to limit power plant construction potentially hindering=20 crucial energy production according to federal records and interviews.=20 The civil antitrust probe of Williams Energy Services and AES Southland=20 represents the Justice Department's first foray into the activities of ener= gy=20 suppliers who have reaped huge profits in California 's price-shocked marke= t.=20 AES disclosed the investigation which began last month in a filing with t= he=20 Securities and Exchange Commission on Tuesday. In its papers AES said the= =20 Justice Department is focusing on whether its agreement with Williams could= =20 constrain future power plant construction in Southern California .=20 The investigation comes at a time when the state is scrambling to get new= =20 generators built and running to avoid blackouts and economic problems.=20 The government alleges that AES and Williams agreed to limit the expansion = or=20 construction of new power plants near three facilities purchased by AES in= =20 1998 from Southern California Edison under the state's new deregulation pla= n.=20 The plants--in Long Beach Huntington Beach and Redondo Beach--are owned by= =20 AES but the electricity is sold by Williams. Under a 3-year-old deal know= n=20 as a tolling agreement Williams essentially rents out the capacity of the= =20 plants for annual payments to AES. Williams supplies natural gas to fire th= e=20 plants and sells the electricity under long-term contracts and in the costl= y=20 spot market.=20 Williams and AES have similar tolling agreements at plants in Pennsylvania= =20 and New Jersey. However AES spokesman Aaron Thomas said the Justice=20 Department's investigative requests have focused only on agreements between= =20 Williams and AES in Southern California .=20 Thomas would say only that the agreement at the center of the investigation= =20 is simply a delineation of how expansion or repowerings are done at the=20 facilities.=20 The three plants have a combined capacity of more than 3900 megawatts=20 enough to supply about 3 million homes. This summer AES is bringing anothe= r=20 450 megawatts on line by reactivating two mothballed generators in Huntingt= on=20 Beach.=20 Paula Hall-Collins a spokeswoman for Tulsa-based Williams Cos. said she= =20 believes that the investigation is unrelated to a recent inquiry by the=20 Federal Energy Regulatory Commission into whether AES and Williams=20 unnecessarily shut down plants to jack up prices. A portion of that=20 investigation was settled in April when Williams without admitting any=20 wrongdoing agreed to pay about $8 million.=20 We've always maintained that we've operated within the law and we're=20 certain the investigation by the DOJ will find we are operating legally= =20 Hall-Collins said.=20 Williams and AES are among the power plant owners and marketers that have= =20 been lambasted by Gov. Gray Davis because of gold-plated electricity prices= =20 that have pushed the state's biggest utilities to the edge of ruin and are= =20 steadily draining the state's budget surplus.=20 State officials are asking FERC to revoke the rights of AES and Williams to= =20 sell electricity at whatever price the market will bear. That right was=20 granted for three years beginning in 1998 by federal regulators when=20 California 's $28-billion electricity market was opened to competition.=20 Under that plan the rights of AES and Williams to sell into the market are= =20 the first to come up for renewal.=20 AES Southland and Williams Energy Services are both arms of large energy=20 companies--AES Corp. of Arlington Va. and Williams Cos. of Tulsa Okla. California Metro Desk=20 Natural Gas Power Prices Drop Sharply Energy: More conservation mild=20 weather are among factors keeping costs down experts say. RICARDO ALONSO-ZALDIVAR NANCY VOGEL ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 WASHINGTON -- The wholesale prices of electricity and natural gas in=20 California have fallen sharply in recent weeks and experts said Tuesday th= at=20 the relief could be the harbinger of an energy turnaround.=20 Or it may be just a blip.=20 In the last couple of weeks California power prices have plunged to the=20 lowest levels since April 2000 traders say with electricity selling on so= me=20 days for less than $100 per megawatt-hour.=20 At night when demand slackens power sometimes sells for less than $20 per= =20 megawatt-hour. That is reminiscent of the days before prices went haywire= =20 last summer.=20 It is a drastically different scenario than the $500 to $800 the state paid= =20 during a spate of hot weather last month.=20 Meanwhile wholesale natural gas prices at a bellwether pipeline junction o= n=20 the Southern California -Arizona border dipped last week to their lowest=20 levels since November according to a publication that tracks the industry.= =20 Separately Southern California Gas Co. and Pacific Gas & Electric Co.=20 reported June rate cuts for their residential gas customers of 16% and 38%= =20 respectively.=20 Experts credited a combination of conservation mild weather a burst of=20 increased hydroelectric generation and lower natural gas prices for the dro= p=20 in electricity costs.=20 Conservation is starting to worry the generators which is nice to see= =20 said Severin Borenstein director of the University of California Energy=20 Institute in Berkeley. Californians used 11% less energy last month than in= =20 May 2000 according to the state Energy Commission.=20 I'm worried that if we don't push harder on conservation [prices] won't= =20 stay down Borenstein added.=20 On the natural gas side experts said the price decline is due to replenish= ed=20 storage within California a nationwide drop in the cost of the fuel and= =20 easing demand from power plants.=20 The number of shippers competing to get natural gas to the state has also= =20 increased with the expiration of a controversial contract on the El Paso= =20 pipeline system last week.=20 But economists were reluctant to make sweeping predictions based on the=20 latest indicators.=20 It's hard to draw specific conclusions said Bruce Henning who tracks th= e=20 natural gas markets for Energy and Environmental Analysis Inc. an Arlingto= n=20 Va. consulting firm.=20 How the summer turns out depends on the weather in the state Henning said= =20 adding The weather represents the balance in the Southern California=20 market.=20 Natural gas fuels most California power plants. With wholesale prices=20 recently averaging three to four times the rates charged elsewhere in the= =20 country state and federal officials have despaired of chances for=20 controlling electricity costs.=20 Last Friday however the daily price for immediate delivery of natural gas= =20 in Topock Ariz. a pipeline junction near the California border dipped to= =20 $7.85 per million British thermal units.=20 According to Natural Gas Week it was the first time since mid-November tha= t=20 the price at that location had fallen below $8 per million BTUs. One millio= n=20 BTUs is what a typical Southern California home uses in five or six days.= =20 Considered a bellwether for other pipeline systems serving California the= =20 Topock price reached a record $56.54 per million BTUs on Dec. 8. It stood a= t=20 $9.36 per million BTUs at the close of business Tuesday still below recent= =20 weekly averages.=20 Other industry publications have also picked up signals of price declines.= =20 Platts the energy information division of McGraw-Hill Cos. reported Tuesd= ay=20 that the price for monthly gas delivery contracts to California fell 22% in= =20 June following a nationwide trend.=20 But Henning said the drop in California prices is attributable to both lowe= r=20 prices around the country and a decline in the high markups for shipping ga= s=20 to California . Those markups which far exceed the cost of transporting ga= s=20 have drawn the attention of state and federal investigators.=20 Henning said the markups are declining as depleted storage levels in=20 California are replenished. Storage levels have been filling very rapidly= =20 and that fact is reflected in prices coming down he said.=20 The link between natural gas and electricity prices is a hotly debated=20 subject. Some experts say high-priced natural gas is driving up the cost of= =20 electricity . Others believe that record prices for power are raising the= =20 prices that generators are willing to pay for their fuel.=20 Electricity prices that range from $20 to $200 per megawatt-hour--instead o= f=20 the $150 to $500 per megawatt-hour paid in recent months--are great news fo= r=20 Gov. Gray Davis.=20 Average daily power prices in California for transactions through the=20 Automated Power Exchange have dropped from $149 per megawatt-hour last Frid= ay=20 to $110 per megawatt-hour Tuesday. The exchange is a private company that= =20 brings together electricity buyers and sellers and accounts for less than 1= 0%=20 of the state's market.=20 Davis spokesman Steve Maviglio said Tuesday that average daily power=20 purchases by the state have recently dipped below $50 million.=20 The state has sometimes had to pay more than $100 million a day since it=20 started buying power in January through the Department of Water Resources.= =20 The state stepped in because California 's two biggest utilities became too= =20 financially crippled to withstand the prices being charged by generators.= =20 Davis' plan to pay for past and future energy purchases with a $12.4-billio= n=20 bond issue hinges on an assumption that power prices will be driven down th= is=20 summer through long-term contracts conservation and the construction of ne= w=20 power plants.=20 UC Berkeley's Borenstein said conservation efforts have not gone far enough= .=20 You walk into most buildings and you still need a sweater he said. That= =20 ain't the way to hit the target.=20 If Californians conserved an additional 10% off their peak usage on hot=20 afternoons he said we could really break the backs of the generators we= =20 could really collapse the price.=20 Prices tend to skyrocket in California 's electricity market on hot=20 afternoons when demand soars and grid operators must scramble to purchase= =20 enough electricity . Cool weather which reduces demand for air conditionin= g=20 and conservation help keep the state from reaching such crisis situations.= =20 Borenstein said he believes generators are also asking less money for their= =20 electricity in part because of a federal order that took effect last month.= =20 The order limits the price power plant owners can charge when California 's= =20 supplies are strained.=20 Power sellers say there are more fundamental forces at work.=20 There's more supply relative to demand which is softening prices said= =20 Gary Ackerman executive director of the Western Power Trading Forum. The= =20 market is working and it's providing cheaper wholesale power more quickly= =20 than any regulatory scheme could ever do.=20 *=20 Times staff writer Dan Morain in Sacramento contributed to this story.=20 RELATED STORY=20 PG&E wins: The utility averted a $1-billion bill for power buys. B6=20 (BEGIN TEXT OF INFOBOX / INFOGRAPHIC)=20 A Blip or a Trend?=20 Daily natural gas prices at the California border with Arizona--considered = a=20 bellwether of the state's costs--have been declining in the last two weeks.= =20 *=20 Natural gas price per 1 million Btu=20 $9.36=20 Source: Natural Gas Week California Metro Desk=20 The State Utility Averts $1 Billion in Costs Courts: PG&E and Cal-ISO agree= =20 to recognize Department of Water Resources as purchaser of the power. TIM REITERMAN ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-6=20 Copyright 2001 / The Times Mirror Company=20 SAN FRANCISCO -- Pacific Gas & Electric Co. and the state's power grid=20 operator reached an agreement Tuesday that insulated PG&E at least=20 temporarily from more than $1 billion in power purchases the state made for= =20 its customers.=20 The California Independent System Operator sent $1.26 billion in invoices t= o=20 the utility for power purchases by the state Department of Water Resources= =20 for PG&E customers from January through March.=20 But the utility contended in Bankruptcy Court proceedings that it was not= =20 liable for such purchases and that continued purchases would cause annual= =20 losses of $4 billion.=20 After arguments before Judge Dennis Montali PG&E and Cal-ISO agreed that t= he=20 Department of Water Resources not PG&E purchased the power. Cal-ISO had= =20 argued that it was making the purchases on PG&E's behalf.=20 PG&E wants to be a utility and have obligations to serve customers but th= ey=20 don't want to pay for it Cal-ISO general counsel Charles Robinson said=20 later.=20 If PG&E refuses to pay the invoices Robinson said Cal-ISO will send the= =20 bills to the Department of Water Resources and officials there can decide= =20 whether to pursue claims in Bankruptcy Court. A spokesman for department= =20 which has authorization to sell $13 billion in bonds for power purchases= =20 said the agency will have no comment until the matter can be studied.=20 State agencies have stayed out of the bankruptcy proceedings hoping to=20 preserve their immunity from suits in federal court.=20 The agreement will be submitted for Montali's approval Monday but the judg= e=20 said it would not be binding on the department because no one represented t= he=20 agency in court.=20 PG&E's own production and contracts provide the majority of the power for i= ts=20 customers. But state legislation adopted this year allows the department to= =20 secure power contracts to serve customers of ailing utilities. When a=20 shortage threatens the power grid the department purchases additional powe= r=20 through Cal-ISO on the spot electricity market.=20 PG&E filed for Chapter 11 protection from creditors on April 6 saying it w= as=20 $9 billion in debt.=20 Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited=20 David Lazarus Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 California electricity prices have plunged unexpectedly to their lowest lev= el=20 in more than a year partly as the result of a simultaneous drop in prices= =20 for natural gas which fuels most power plants.=20 Make no mistake: Gas and electricity prices could surge upward again in=20 months ahead.=20 But for the first time since California's energy markets went haywire last= =20 summer industry experts are beginning to ask whether the state finally may= =20 have turned a corner in its battle with runaway power costs.=20 California is not yet out of the woods said Kelley Doolan who tracks=20 natural gas prices for energy market researcher Platts. But this is a very= =20 significant decrease in costs.=20 Along with lower gas prices the decline in electricity costs was attribute= d=20 by state and industry officials to milder weather which reduces demand for= =20 power. They also credited recent conservation efforts by consumers and=20 better-than-expected runoff at dams for hydroelectric plants.=20 Gary Ackerman executive director of the Western Power Trading Forum an=20 energy-industry association said these factors came together to produce th= e=20 lowest wholesale electricity prices since April 2000.=20 Electricity on the spot market could have been purchased yesterday for as= =20 little as $50 per megawatt hour he noted compared with more than $500=20 earlier this year.=20 If the weather stays this way we could have reasonable prices all summer= =20 Ackerman said. We may also have fewer blackouts.=20 It is tempting for Californians to be suspicious of virtually any swing in= =20 energy prices. If power companies manipulated prices on the way up as=20 critics have alleged might they not be up to some trick as prices head in= =20 the opposite direction?=20 Nettie Hoge executive director of The Utility Reform Network in San=20 Francisco speculated that generators are allowing electricity prices to fa= ll=20 so they can discourage federal regulators from taking a more active role in= =20 the dysfunctional California market.=20 They're trying to take the heat off she said.=20 Others cautioned that the lower prices may be nothing more than a statistic= al=20 blip.=20 This was just one month's decline said Michael Shames executive directo= r=20 of the Utility Consumers' Action Network in San Diego. We really have to s= ee=20 how this plays out in the future.=20 Steve Maviglio a spokesman for Gov. Gray Davis said the governor was very= =20 encouraged by the lower energy prices. Davis announced Sunday that=20 California's power use was down 11 percent last month from a year before.= =20 We're not there yet Maviglio said of whether an end to the state's power= =20 woes is in sight. But the trend is pointing in the right direction.=20 WHITE ELEPHANT Yet this sudden drop in energy prices does have a dark side: California cou= ld=20 end up with a huge white elephant after spending about $40 billion in publi= c=20 funds on long-term power contracts.=20 The logic behind the contracts which are at an average price of $69 per=20 megawatt hour over 10 years is that the state expected to pay below-market= =20 rates for electricity for a number of years before prices came down and=20 California found itself paying above-market rates.=20 If current trends continue though California will find itself paying=20 consistently above-market rates much sooner than expected making the long-= =20 term contracts a sweet deal for the same power companies that profited so= =20 handsomely during the state's darkest hours.=20 The contracts look really ugly right now said Shames at the Utility=20 Consumers' Action Network. They may be way overpriced.=20 Maviglio the governor's spokesman said it is too early to conclude that t= he=20 state did poorly negotiating dozens of long-term power contracts.=20 No one has a crystal ball on this he said.=20 CUSTOMERS' BILLS TO DROP In any case Pacific Gas and Electric Co. said yesterday that customers'=20 average gas bills will drop 26 percent this month to $26 and should stay ne= ar=20 that level all summer.=20 Platts which monitors average monthly spot prices found that the wholesal= e=20 price of gas at the California-Oregon border has tumbled nearly 42 percent= =20 since the beginning of May -- from $9.98 per million British thermal units = to=20 $5.81.=20 The wholesale gas price at the California-Arizona border fell 45 percent= =20 from $11.91 to $6.50. This compares with a 25 percent monthly decline in=20 average natural gas prices nationwide.=20 However California gas prices are still about 50 percent higher than they= =20 were a year ago whereas national prices are now below year-ago levels for= =20 the first time since last spring.=20 While cooler weather nationwide helped push gas prices down overall Doolan= =20 attributed the especially steep drop in California to a commensurate surge = in=20 prices last month related to fears of a long hot summer of rolling=20 blackouts.=20 You had state officials all but promising rolling blackouts this summer = he=20 said. That created enormous demand for electricity generation.=20 What has changed is that we've had weeks of mild weather Doolan observed= .=20 The electricity generators have not come out of the woodwork buying up all= =20 the gas.=20 This allowed utilities like PG&E to beef up gas inventories which eased=20 demand and resulted in substantially lower prices he said.=20 'BACK ON TRACK'=20 We're back on track to be completely full for winter said Staci Homrig = a=20 PG&E spokeswoman. That's a very good thing.=20 Gas prices historically dip in the spring and summer and then rise again in= =20 the winter. PG&E is forecasting that customers' average gas bills could ris= e=20 to as high as $75 in December if current trends continue.=20 However the precipitous drop in gas prices in recent weeks suggests that= =20 California's unusually high costs at last may be abating.=20 Individual power companies so far are reluctant to speculate on whether the= =20 drop in gas prices will have a lasting effect on electricity costs.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 San Jose council gives green light to generating plant=20 VOTE REVERSAL: Officials pressured to OK project=20 Marshall Wilson Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 In a clear sign that the political landscape has shifted because of the=20 state's power crisis the San Jose City Council gave a green light yesterda= y=20 for construction of a generating plant it had unanimously opposed in=20 November.=20 Yesterday's 10-to-1 vote came after months of mounting pressure for the cit= y=20 to reverse course and approve the controversial 600-megawatt Calpine plant = at=20 Coyote Valley.=20 That pressure -- increased by the occasional rolling blackout -- has come= =20 from nearly every corner of the state from elected officials to high-tech= =20 businesses and labor unions worried the power crisis will drain away jobs= =20 ruin the economy and lead to voter backlash over skyrocketing energy bills.= =20 Even the local branch of the NAACP and environmentalists pushed the council= =20 to approve the Calpine proposal -- despite overwhelming opposition from the= =20 plant's neighbors.=20 Council members did not hide their disdain yesterday for being forced to=20 reconsider their opposition to the so-called Metcalf Energy Center.=20 I'm holding my nose to vote for this thing said Councilwoman Linda=20 LeZotte.=20 I'm just as unhappy as everybody else Vice Mayor George Shirakawa said. = I=20 feel like no matter what happens we can't win.=20 GOVERNOR OFFERED HIS SUPPORT After the council's solid opposition in November Calpine appealed to the= =20 California Energy Commission which has the final say. The controversial=20 plant then received a huge boost in April when Gov. Gray Davis threw his=20 support behind it.=20 San Jose officials conceded yesterday that the energy commission was likely= =20 to override their opposition and grant approval within a few weeks. They sa= id=20 the commission's likely approval was stripping them of their power to decid= e=20 local land-use issues.=20 What I think has happened . . . is the governor and the Legislature at the= =20 state level have taken this out of our hands said Councilwoman Pat Dando.= =20 I don't think there's any chance at all the California Energy Commission i= s=20 going to turn down the Metcalf Energy Center Councilman Chuck Reed said.= =20 CONSTRUCTION MAY BEGIN SOON If given the go-ahead by the state Calpine could begin construction as ear= ly=20 as next month. The natural-gas fired plant would generate electricity by=20 mid-2003 company spokesman Kenneth Arbeu said.=20 At the urging of Mayor Ron Gonzales the council yesterday approved a new= =20 cooperation agreement with Calpine. The vote with Councilman Forrest=20 Williams casting the lone nay is preliminary while a final vote that is=20 scheduled for June 26.=20 Gonzales argued that the agreement did not amount to a flip-flop because it= =20 differs from what Calpine proposed in November.=20 The agreement approved by the council calls for increased monitoring of air= =20 pollution the use of treated wastewater to cool the plant which will redu= ce=20 discharges into San Francisco Bay and a $6.5 million community benefits= =20 package with the bulk going toward parkland acquisition Gonzales said.=20 This council has not changed its decision he said. What we've done is= =20 change the facility.=20 Critics incensed that the city was buckling to outside pressure vowed to= =20 change the council at the next election.=20 CONCERNS OVER HEALTH RISKS They raised concerns that boiled wastewater steam wafting over their homes= =20 from Calpine's plant could pose health risks. Jona Denz-Hamilton said more= =20 controls are needed to ensure the safety of neighbors like herself and her= =20 family and argued that new cleaner-burning technologies should be installe= d=20 at the plant.=20 It's too great of a risk she said.=20 Other critics said the state's energy woes will be solved and largely=20 forgotten by the time the plant opens in two years while the Santa Teresa= =20 neighborhood will be stuck with pollution for decades.=20 Approval seemed a given at the start of the more than three-hour hearing.= =20 Much of the afternoon's debate focused around plans to extend a pipeline fo= r=20 treated wastewater to the new plant.=20 Critics said Calpine was receiving a sweet deal by paying only $10 million = of=20 the $50 million cost of extending the pipeline. Several council members ask= ed=20 for a more detailed report into the financing plan before the final vote is= =20 taken June 26.=20 Chronicle staff writer Bill Workman contributed to this report.=20 E-mail Marshall Wilson at 2001 San Francisco Chronicle ? Page?A - 1=20 Developments in California's energy crisis=20 Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate1 053EDT0177.DTL=20 (06-06) 07:53 PDT (AP) --=20 Developments in California's energy crisis:=20 WEDNESDAY: * No power alerts Wednesday as reserves stay above 7 percent.=20 TUESDAY: * Gov. Gray Davis' administration says the state's electricity costs are=20 dropping substantially even as it asks state legislators for another=20 half-billion dollars for power purchases. That brings to $8.2 billion the= =20 amount the state is paying for electricity on behalf of three financially= =20 strapped utilities.=20 Spokesman Steve Maviglio says the cost to the state treasury has dropped in= =20 the last few weeks well below the $50 million dollars the state had been=20 paying on a typical day. He credits cooler weather conservation more powe= r=20 plants online and more long-term contracts with helping drive down the cost= .=20 * A state Senate committee agrees to issue subpoenas to eight out-of-state= =20 electricity generators demanding they hand over documents on bidding prici= ng=20 and other aspects of power sales in the state. The subpoenas would help a= =20 special Senate committee's investigation into whether the companies are=20 illegally profiteering from California's power crisis. The committee's=20 chairman says he expects the companies to resist setting the stage for a= =20 court battle.=20 * Oil giant Chevron threatens to cut gasoline production in California unle= ss=20 it is exempted from rolling blackouts. The San Francisco Chronicle says it= =20 has a copy of a letter sent Friday from Chevron chairman David O'Reilly to= =20 Davis. In the letter O'Reilly says the company will scale back gasoline=20 production at its Richmond and El Segundo plants operating those refinerie= s=20 only with power produced by generators at the sites.=20 * New U.S. Senate Majority Leader Tom Daschle D-S.D. supports Federal=20 Energy Regulatory Commission price caps. FERC must meet its obligation und= er=20 current law to ensure 'just and reasonable' prices for wholesale electricit= y=20 in the state of California. FERC has failed to meet this responsibility...= =20 Daschle says in a letter to Davis. Unless FERC acts soon Senator (Dianne)= =20 Feinstein's legislation should be taken up and passed to direct FERC to tak= e=20 action. I will support all necessary efforts to meet that goal.=20 * House Subcommittee on Energy Policy Natural Resources and Regulatory=20 Affairs Chairman Doug Ose R-Sacramento cites Electric Utility Week figure= s=20 that FERC's limited price caps helped cut California's power rates from $30= 0=20 to $108.47 per megawatt hour within an hour after taking effect last week.= =20 While he says more information is needed Ose uses the figures to tout his= =20 pending bill to impose the price caps around the clock and to all Western= =20 states.=20 * Pacific Gas & Electric Co. asks U.S. Bankruptcy Judge Dennis Montali to= =20 stop the manager of the state's power grid from buying electricity for=20 utility or charging it for any electricity bought after the utility filed f= or=20 bankruptcy on April 6. Separately the utility's creditors support its=20 request to the bankruptcy court to pay out $17.5 million in bonuses to the= =20 management team that guided the utility into bankruptcy.=20 * California Department of Water Resources reveals it is negotiating with= =20 municipal utilities to buy their surplus power. Department spokesman Oscar= =20 Hidalgo says talks began last week but no agreements are imminent.=20 * State lawmakers criticize a $3 million lobbying campaign by Southern=20 California Edison. The utility is telephoning shareholders to describe the= =20 dire consequences if the utility goes bankrupt. The call is then transferre= d=20 to the state Capitol so shareholders can implore lawmakers to support a=20 controversial plan to help the utility. Legislators and their staffers say= =20 the shareholders often are confused and scared their investments will be=20 degraded or wiped out.=20 * State Treasurer Phil Angelides joins an advocacy group for the poor in=20 urging the state's huge pension funds to use their economic power to levera= ge=20 power companies. The Pacific Institute for Community Organization says the= =20 two pension funds own at least $1.2 billion in stocks and bonds in most of= =20 the firms that sell electricity to California.=20 * The Assembly by a 69-0 vote approves a bill to spend $10 million on=20 environmental studies needed before Path 15 the inadequate transmission-li= ne=20 group between Northern and Southern California can be expanded. The bill= =20 moves to the Senate.=20 * Pacific Gas and Electric announces a decrease in natural gas prices down= =20 38 percent from May's rates and 66 percent lower than January's rates. The= =20 decline will bring the average residential gas bill to $26 when it goes int= o=20 effect June 7. Market analysts predict the rates will remain stable until= =20 December when demand is expected to increase with winter heating loads.=20 * No power alerts Tuesday as electricity reserves stay above 7 percent.=20 * Shares of Edison International closed at $10.05 down 53 cents. PG&E Corp= .=20 closed at $11.25 down 15 cents. Sempra Energy the parent company of San= =20 Diego Gas & Electric closes at $26.91 down 43 cents.=20 WHAT'S NEXT: * Davis' representatives continue negotiating with Sempra the parent compa= ny=20 of San Diego Gas and Electric Co. to buy the utility's transmission lines.= =20 THE PROBLEM: High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Edison and PG&E say they've lost nearly $14 billion since June to high=20 wholesale prices the state's electricity deregulation law bars them from=20 passing on to consumers. PG&E saying it hasn't received the help it needs= =20 from regulators or state lawmakers filed for federal bankruptcy protection= =20 April 6.=20 Electricity and natural gas suppliers scared off by the two companies' poo= r=20 credit ratings are refusing to sell to them leading the state in January = to=20 start buying power for the utilities' nearly 9 million residential and=20 business customers. The state is also buying power for a third investor-own= ed=20 utility San Diego Gas & Electric which is in better financial shape than= =20 much larger Edison and PG&E but also struggling with high wholesale power= =20 costs.=20 The Public Utilities Commission has approved average rate increases of 37= =20 percent for the heaviest residential customers and 38 percent for commercia= l=20 customers and hikes of up to 49 percent for industrial customers and 15=20 percent or 20 percent for agricultural customers to help finance the state'= s=20 multibillion-dollar power buys.=20 2001 Associated Press ?=20 California conserves=20 Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/E D86597.DTL=20 WHEN RAIN fails to fall from the sky Californians know why there is a=20 drought. But when rolling blackouts suddenly appeared in the dead of winter= =20 many of us wondered who was responsible for and who has profited from what= =20 now seems like an artificially created power shortage in the state.=20 Our skepticism proved to be right. Windfall profits were reaped by=20 electricity generators while natural gas importers extracted prices far abo= ve=20 the national average.=20 Timid federal overseers exact only wrist-slap penalties on the offending=20 energy firms. The White House scoffs at temporary controls for a=20 malfunctioning market. California's state government has ended up as the bi= ll=20 payer for the sickly utilities forking over $8 billion to generators. This= =20 number may hit $40 billion by year-end.=20 It's an infuriating tangle. All the more remarkable then that skeptical= =20 Californians have managed within two months to reduce their use of=20 electricity by 11 percent. The public's response to the governor's appeal f= or=20 energy conservation has exceeded expectations. Although many businesses hav= e=20 suffered enormous losses ordinary people have made relatively painless=20 sacrifices. People turned off their lights purchased energy-efficient=20 lightbulbs used air conditioning less and shut off their computers when no= t=20 in use.=20 Despite this remarkable civic compliance we still face an unconscionable= =20 lack of leadership. President Bush seems perfectly willing to allow Texas= =20 power companies to pummel the once-powerful California economy. He repeats = a=20 mantra about creating more supply -- which California is doing with 15 powe= r=20 plants under construction -- while ignoring the outsized sums paid to a=20 handful of energy generators.=20 At the same time Gov. Gray Davis who has given new meaning to the word=20 dithering has failed to make the tough and transparent decisions. He delay= ed=20 an inevitable rise in power rates. Davis also dragged his feet in openly=20 announcing new power contracts that commit California to billions in spendi= ng=20 over the next decade.=20 To Davis' credit he has urged California to conserve by laying out an $800= =20 million plan to cut power use and invest in energy-saving programs. The=20 message is getting out as higher rates take effect this month.=20 Despite a woefully unbalanced market and shortsighted leadership the peopl= e=20 of California have demonstrated that if there is a will there is a way.=20 Now it is time for our leaders to follow the wisdom of their constituents.= =20 2001 San Francisco Chronicle ? Page?A - 20=20 L.A. power customers awash in cheap energy=20 John Wildermuth Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/M N133438.DTL=20 Los Angeles -- These are flush times for the city's Department of Water and= =20 Power and the energy executives are loving every minute of it.=20 As are their customers.=20 Private power companies throughout California have been raising rates and= =20 warning customers about a long hot summer filled with blackouts but the= =20 city- owned DWP has been keeping prices stable and the lights on for 1.2=20 million Los Angeles customers.=20 Our customers are being really nice to us said Angelina Galiteva the=20 utility's strategic planning director. They love the DWP.=20 Although Gov. Gray Davis' administration announced that the state had reduc= ed=20 its energy consumption 11 percent from a year ago those in Los Angeles had= =20 cut back less than half that -- and polls show they view the energy situati= on=20 less seriously than other Californians.=20 Public utilities such as Los Angeles water and power have seen their revenu= es=20 increase during the energy crunch because they can sell their excess power = at=20 higher prices than ever before in a market tilted toward sellers.=20 The rest of the state doesn't always feel that same warm glow. Davis has=20 accused the DWP and other California public utilities of putting exorbitant= =20 price tags on the excess electricity they sell to the rest of the energy-= =20 starved state.=20 It's a charge Los Angeles utility executives deny arguing that their exces= s=20 power is sold at cost plus 15 percent which they say is a fair return for= =20 their customers.=20 Without our support a million more homes (elsewhere in California) would= =20 have suffered rolling blackouts which is a powerful message Galiteva sai= d.=20 It wasn't supposed to be this way. When the power industry was deregulated = in=20 the late '90s energy giants like Pacific Gas and Electric Co. and Southern= =20 California Edison were expected to be the big winners. Now PG&E is in=20 bankruptcy and Edison is a short step away.=20 When deregulation came the experts said that the investor-owned utilities= =20 would become lean mean machines that would be better able to operate in th= e=20 new environment Galiteva said. But now public power has shown it can ser= ve=20 customers more efficiently at lower rates.=20 While much of the state worries about electrical supply Los Angeles=20 residents have been saved many of those concerns.=20 In a survey done last month by the Public Policy Institute of California 4= 8=20 percent of the people in the Bay Area thought that electricity cost and=20 availability were the most important issues facing the state. In Los Angele= s=20 however only 33 percent put the energy crunch on top. When questioned abou= t=20 the size of the power problem and the effect it would have on the state's= =20 economy Los Angeles residents were consistently less concerned than people= =20 elsewhere in California.=20 People in Los Angeles have been somewhat isolated from the energy crisis= =20 concluded Mark Baldassare who conducted the survey.=20 That doesn't mean the state's energy problems haven't had an effect. The DW= P=20 has seen a 3 percent to 5 percent reduction in some uses which officials= =20 have dubbed sympathy conservation. The utility also is offering its bigge= st=20 customers financial incentives to cut back on their power use.=20 Our average annual load growth is about 80 megawatts Galiteva said. By= =20 this summer we expect to have saved 40 megawatts through conservation. By= =20 December we expect 60 megawatts in savings.=20 The utility also is making a major attempt to create a conservation ethic= =20 among its customers. DWP's comfortable situation has made it possible to=20 offer them the carrot without the need to show them the stick.=20 Conservation no longer means doing without Galiteva said. Beer can be= =20 just as cold with a superefficient refrigerator. Rooms can be just as brigh= t=20 with superefficient light bulbs.=20 A Green Power program also is promoting the use of renewable energy=20 resources such as solar wind and hydroelectric power. About 75000 custome= rs=20 are paying an extra $3 per month to increase DWP's use of renewable power= =20 sources.=20 We're trying to give our customers a choice and a voice in determining the= =20 mix of power they use Galiteva said. They know they can do (conservation= )=20 now or see it being mandated later.=20 Los Angeles power officials -- and their customers -- know the DWP isn't=20 always going to continue as an island of tranquility in a sea of energy=20 turmoil. The utility's aging gas-fired plants have been affected by the=20 rising price of natural gas. Demand for energy continues to rise. In a deba= te=20 last month both candidates for mayor of Los Angeles agreed that increases = in=20 local power bills are inevitable.=20 But the DWP has been supplying power to Los Angeles since 1916 and its=20 executives believe that the state's deregulation disaster has shown the=20 advantages of the city-owned utility.=20 It's nice to be the lean mean green efficient machine that no one ever= =20 expected us to become Galiteva said.=20 E-mail John Wildermuth at 2001 San Francisco Chronicle ? Page?A - 13=20 PG&E doesn't want to pay for energy to avert blackouts=20 DAVID KRAVETS Associated Press Writer Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate0 306EDT0102.DTL=20 (06-06) 00:06 PDT SAN FRANCISCO (AP) --=20 Pacific Gas & Electric Co. has told a bankruptcy judge it should not have t= o=20 pay for what could amount to billions of dollars in spot-market energy cost= s=20 to avert blackouts.=20 The company's position was one of two developments that emerged Tuesday as= =20 the bankrupt utility tries to cope with fallout from California's power=20 crisis. The other development saw a group of creditors that PG&E owes=20 billions endorse $17.5 million in bonuses for top managers at the utility.= =20 San Francisco-based PG&E filed for bankruptcy protection in April after=20 racking up an $8.9 billion debt which under state law it could not recoup= =20 from customers.=20 Tuesday's court dispute centered on who pays for energy bought at the last= =20 minute to avoid blackouts.=20 PG&E said an April federal regulatory decision requires that electricity ca= n=20 only be sold to those with the ability to pay electricity generators. The= =20 state is the only player with such ability said PG&E attorney Jerome Faulk= =20 who argued that the utility shouldn't have to pay the $330 million in month= ly=20 spot-market energy bills.=20 Judge Dennis Montali said he may craft such an order. But he said the order= =20 would not preclude the state from suing PG&E to recover the cost.=20 In a separate but related development a committee charged with devising a= =20 payment plan for those creditors owed billions by PG&E said it will sign of= f=20 on the utility's plan to pay $17.5 million in bonuses to PG&E's management= =20 team.=20 Attorney Allan Marks who represents the committee said such payments are= =20 normal during large bankruptcy cases. Under the agreement which Montali wi= ll=20 consider at a June 18 hearing the company must quickly produce a debt=20 payment plan that passes judicial muster.=20 The utility said it needs the bonuses for a management retention program.= =20 Marks agreed. While the $17.5 million leaves less for creditors without a= =20 financial incentive PG&E's key top brass may not be willing to cooperate wi= th=20 a payment plan Marks said.=20 The main goal for the creditors' support here is to move the bankruptcy as= =20 quickly and smoothly as possible Marks said.=20 The Utility Reform Network a consumer watchdog group says PG&E is simply= =20 rewarding managers of a failed business effort.=20 They're just showering money on the same people who got them in this mess= =20 said TURN's Mike Florio.=20 The proposed bonuses would come on top of $50 million in bonuses and raises= =20 PG&E awarded just before the April 6 bankruptcy filing.=20 The case is In Re Pacific Gas & Electric Co. 01-30923 DM.=20 2001 Associated Press ?=20 Metcalf plant gets preliminary approval=20 Posted at 12:21 a.m. PDT Wednesday June 6 2001=20 BY MIKE ZAPLER=20 Mercury News=20 As the San Jose City Council approached its 10-1 vote Tuesday to give an=20 initial nod to Calpine's big power plant in South San Jose Councilwoman=20 Linda LeZotte perhaps captured the body's mood best.=20 ``I'm holding my nose to vote for this thing'' she said. ``Without faultin= g=20 the mayor or his staff quite frankly I think this deal stinks.''=20 Caught in what some members called a bind beyond their control the council= =20 gave preliminary approval to an agreement negotiated by Mayor Ron Gonzales= =20 and Calpine on the company's proposed 600-megawatt Metcalf Energy Center.= =20 Councilman Forrest Williams who represents the Santa Teresa neighborhood= =20 near the site cast the lone vote against the deal.=20 The agreement is scheduled to come back before the council for a final vote= =20 on June 26 but Tuesday's vote effectively shifts the battle to the courts= =20 where residents are expected to lodge a lawsuit in one final attempt to blo= ck=20 the plant.=20 Still Councilwoman Pat Dando and some of her colleagues raised questions= =20 about the deal they said they want answered before the final vote. Their=20 issues could be incorporated into the final deal.=20 Many of the concerns focused on a $50 million recycled water pipeline=20 Gonzales agreed to have the city build to accommodate the project $10=20 million of which would be reimbursed by Calpine over 30 years.=20 Pipeline possibility=20 Dando said that a private company Great Oaks Water may be willing to buil= d=20 the pipeline extension itself saving the city the $50 million expense.=20 Officials at Great Oaks were unavailable Tuesday.=20 Council members peppered staff with other questions. Many were alarmed by= =20 claims of the Silicon Valley Toxics Coalition which said that using treate= d=20 sewage water to cool the power plant could allow dangerous chemicals to see= p=20 into drinking water aquifers. An environmental services director said the= =20 recycled water meets federal specifications but that there is no protocol= =20 for testing other chemicals not included in those standards.=20 Councilman Ken Yeager asked why Calpine should be allowed to spread a $3.9= =20 million water connection fee over 10 years -- an arrangement that would=20 mandate an amendment to city law.=20 LeZotte meanwhile said she wants to hold Calpine accountable to install= =20 ammonia-free technology at the plant. Ammonia is highly hazardous and=20 residents say the use of the chemical to clean the plant is among their chi= ef=20 concerns.=20 The agreement requires the company to install technology to reduce or=20 eliminate the use ammonia when it becomes ``technologically and economicall= y=20 feasible.'' LeZotte said she wants a clear definition of ``feasible''=20 included in the deal.=20 Tuesday's vote marked a stark departure from the council's November vote to= =20 deny Metcalf. At the time council members said a power plant was=20 inappropriate for the area and many members said Tuesday that they still= =20 believe that.=20 Bowing to pressure=20 But with Gov. Gray Davis endorsing Metcalf in April and the California Ener= gy=20 Commission widely expected to override the city's denial this month counci= l=20 members said they had no choice but to cut the best deal it could and allow= =20 the project to proceed.=20 That explanation however didn't sit well with residents of the Santa Tere= sa=20 neighborhood adjacent to the Metcalf site one of whom accused Gonzales and= =20 the council of ``switching sides when the opposing team gets too close to t= he=20 goal line.''=20 Contact Mike Zapler at mzapler@sjmercury.com or at (408) 275-0140.=20 Feds probe AES Williams=20 Antitrust investigation looks into allegations of manipulated energy prices= =20 through reduced power-plant construction.=20 June 6 2001=20 By JAMES ROWLEY Bloomberg News=20 WASHINGTON - The U.S. Justice Department opened an antitrust investigation= =20 into California's electricity shortage by probing allegations that AES Corp= .=20 and Williams Energy Services Co. are limiting power-plant expansion to driv= e=20 up prices.=20 AES Corp. the biggest U.S. power-plant developer disclosed the=20 investigation in a filing with the U.S. Securities and Exchange Commission.= =20 The Justice Department is looking into a supply-and-marketing agreement=20 between AES' California power-plant unit and a Williams unit that supplies= =20 natural gas.=20 Williams owner of the second-largest U.S. natural-gas pipeline system als= o=20 markets the power produced by AES' three electricity plants in the state.= =20 The department alleges the agreement limits expansion of generating capacit= y=20 near some AES plants.=20 AES said it was cooperating with the Justice Department investigation whic= h=20 began last month into possible violations of Section 1 of the Sherman=20 Antitrust Act.=20 That provision outlaws any restraint of trade that stifles competition.=20 A shortage of generating capacity in California has led to soaring wholesal= e=20 prices and rolling blackouts and prompted Pacific Gas & Electric the state= 's=20 largest utility to seek bankruptcy protection in April.=20 Aaron Thomas a spokesman for AES based in Arlington Va. said the U.S.= =20 investigation started no more than a couple of weeks ago.=20 Williams spokeswoman Paula Hall-Collins said the Tulsa Okla.-based company= =20 is cooperating.=20 Gina Talamona Justice Department spokeswoman said the agency had no=20 immediate comment.=20 The investigation was opened several weeks after the Federal Energy=20 Regulatory Commission investigated AES plants in Long Beach and Huntington= =20 Beach designated must run under the Federal Power Act did not produce= =20 electricity for 10 days in April and May 2000. Williams agreed to pay the= =20 operator of California's electric grid $8 million to settle allegations tha= t=20 it overcharged for power.=20 FERC charged in March that the companies had a financial incentive to keep= =20 the units out of service to force the California Independent System Operato= r=20 to buy power from AES' plant in Redondo Beach at prices close to the=20 FERC-imposed cap of $750 per megawatt-hour.=20 AES said it was complying with a Justice Department demand for documents=20 about the agreement between its AES Southland LLC unit and Williams Energy= =20 Services Co. AES Southland which operates the three power plants was also= =20 asked to respond to interrogatories the company said.=20 The Williams unit supplies the natural gas to fuel the AES plants and marke= ts=20 the power they produce.=20 AES and Williams jointly produce and sell about 4000 megawatts in Californ= ia=20 -- 6 to 8 percent of the state's power -- enough electricity to light about= 3=20 million typical California homes.=20 AES shares dropped $2.05 to $42.54. Williams Cos. shares dropped $1 to=20 $38.20. Calpine Begins Construction of Peaking Energy Center in Gilroy Calif.=20 June 6 2001=20 SAN JOSE Calif. June 5 /PRNewswire/ via NewsEdge Corporation -=20 Calpine Corporation (NYSE: CPN) the San Jose Calif.-based independent pow= er=20 company today announced that initial construction of 135 megawatts (mw) of= =20 peaking generation capacity will begin during this week adjacent to its=20 existing Gilroy Power Plant in Gilroy Calif. Through an Application for=20 Certification (AFC) filed with the California Energy Commission (CEC) on=20 April 25 2001 Calpine proposed to add three 45-mw simple-cycle gas turbin= e=20 peaking units in the first of a two-phase process. The California Energy=20 Commission approved the project on May 21 2001.=20 Because the required natural gas water and transmission infrastructure=20 exists at our Gilroy plant it is an ideal site for the addition of peaking= =20 generation allowing for rapid installation of needed capacity. The first= =20 three units are expected to begin generating electricity this September= =20 commented Bryan Bertacchi Calpine Vice President - Western Region.=20 Upon completion the two-phase build out the Gilroy Energy Center will be a= =20 270-mw natural gas-fired simple-cycle peaking generation facility located= =20 on approximately 9.5 acres at 1400 Pacheco Pass Highway in Gilroy. Commerci= al=20 operation of Phase One is scheduled for September 2001. An additional three= =20 45-mw gas turbine generators will be installed in Phase Two with full=20 build-out estimated for May 2002. Phase Two requires the filing of an=20 additional application with the CEC and is subject to a four-month review= =20 process.=20 Initial construction will begin this week with site and civil engineering= =20 activities occurring for approximately six weeks at which time the site wil= l=20 be cleared and leveled. Foundation work and the installation of generation= =20 equipment will follow shortly thereafter and commissioning and testing wil= l=20 take place for a two to three week period prior to commercial operation in= =20 September 2001.=20 The Gilroy Energy Center web site has been created to host all information= =20 and updates related to this project. For additional information please vis= it=20 www.gilroypower.com.=20 Calpine Corporation based in San Jose Calif. is dedicated to providing= =20 customers with reliable and competitively priced electricity. Calpine is=20 focused on clean efficient natural gas-fired generation and is the world'= s=20 largest producer of renewable geothermal energy. Calpine has launched the= =20 largest power development program in North America. To date the company ha= s=20 approximately 32200 megawatts of base load capacity and 7200 megawatts of= =20 peaking capacity in operation under construction pending acquisitions and= =20 in announced development in 29 states and Canada. The company was founded i= n=20 1984 and is publicly traded on the New York Stock Exchange under the symbol= =20 CPN. For more information about Calpine visit its Website at=20 www.calpine.com.=20 This news release discusses certain matters that may be considered=20 forward-looking statements within the meaning of Section 27A of the=20 Securities Act of 1933 as amended and Section 21E of the Securities=20 Exchange Act of 1934 as amended including statements regarding the intent= =20 belief or current expectations of Calpine Corporation (the Company) and i= ts=20 management. Prospective investors are cautioned that any such forward-looki= ng=20 statements are not guarantees of future performance and involve a number of= =20 risks and uncertainties that could materially affect actual results such as= =20 but not limited to (i) changes in government regulations including pendin= g=20 changes in California and anticipated deregulation of the electric energy= =20 industry (ii) commercial operations of new plants that may be delayed or= =20 prevented because of various development and construction risks such as a= =20 failure to obtain financing and the necessary permits to operate or the=20 failure of third-party contractors to perform their contractual obligations= =20 (iii) cost estimates are preliminary and actual cost may be higher than=20 estimated (iv) the assurance that the Company will develop additional=20 plants (v) a competitor's development of a lower-cost generating gas-fired= =20 power plant and (vi) the risks associated with marketing and selling power= =20 from power plants in the newly competitive energy market. Prospective=20 investors are also cautioned that the California energy environment remains= =20 uncertain. The Company's management is working closely with a number of=20 parties to resolve the current uncertainty while protecting the Company's= =20 interests. Management believes that a final resolution will not have a=20 material adverse impact on the Company. Prospective investors are also=20 referred to the other risks identified from time to time in the Company's= =20 reports and registration statements filed with the Securities and Exchange= =20 Commission.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Calpine Corporation=20 CONTACT: media Lisa Poelle ext. 1285 or investors Rick Barraza ext.=20 1125 both of Calpine Corporation 408-995-5115=20 Web site: http://www.gilroypower.com=20 Web site: http://www.calpine.com (CPN)=20 Reliant Urges FERC to Drop or Amend California Price Caps to Avoid Addition= al=20 Shortages and More Blackouts=20 June 6 2001=20 HOUSTON June 5 /PRNewswire/ via NewsEdge Corporation -=20 Reliant Energy (NYSE: REI) filed an emergency motion with the Federal Energ= y=20 Regulatory Commission (FERC) on Monday urging the agency to drop the=20 California price caps first applied May 29 or at a minimum amend them to= =20 reflect the true costs they are attempting to control. The current price=20 caps which send inaccurate market signals are actually decreasing supply= =20 and increasing demand thus worsening an already dire situation.=20 FERC has been publicly dedicated to an open market from the beginning of t= he=20 California power crisis. We encourage FERC to reexamine these price caps an= d=20 continue that dedication said Joe Bob Perkins president and chief=20 operating officer Reliant Energy Wholesale Group. Reliant is committed to= =20 helping keep the lights on in California this summer and wants to ensure th= at=20 if caps must remain part of the picture they actually help increase supply= =20 and fix the problem.=20 Although the price caps were first imposed less than a week ago they have= =20 already begun to damage the market by decreasing supply. The price caps are= =20 creating a myriad of problems:=20 -- Creates Misleading Signals - The price cap methodology is misleading=20 the public on the actual cost of power. Reported dispatch costs in=20 Southern California during emergencies is far below what the actual=20 financial settlements will be under the FERC's final market mitigation=20 order. This confusion results from the proxy price used for=20 dispatch utilizing an extremely distorted blended fuel cost index.=20 This index averages gas costs in northern and southern parts of the=20 state an impossibility in the actual market. This authorizes the=20 California Independent System Operator (ISO) to require that=20 generators dispatch power at reported market clearing prices well=20 below actual cost when back-up generation capacity begins to dip below=20 7.5 percent.=20 -- Depletes Power from Peaking Plants - The price caps distort dispatch=20 signals on peaking plants which in some cases may be run only a few=20 days of the year because of emission regulations. The current FERC=20 price controls encourage the ISO to purchase power from emergency=20 peaking plants before it is really needed even in the absence of a=20 stage three emergency. This depletes supplies that will by law run=20 out when blackout season intensifies later this summer. This power=20 from peaking units should only be purchased when blackouts are=20 imminent -- not in stage one or two emergencies.=20 -- Eliminates Price Signals for Retail Customers - Price caps remove=20 price signals for retail customers. Customers particularly=20 industrial companies which should be encouraged to curtail during=20 shortages are not encouraged to conserve power when dispatched price=20 caps keep prices below the actual cost to produce electricity.=20 -- Discourages Supply from Out-of-State - Suppliers outside of=20 California who are under no legal obligation to dispatch power during=20 an emergency in the state are not encouraged to increase available=20 production when reported market clearing prices are below their cost=20 to produce. During times of emergencies utilities across the Western=20 region are not likely to take on additional risks and costs if they=20 don't believe they will be fully compensated - a situation the current=20 price caps create.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Reliant Energy=20 CONTACT: Maxine Enciso of Ketchum Public Relations Los Angeles=20 310-444-1303 for Reliant Energy or media Richard Wheatley of Reliant=20 Energy 713-207-5881=20 Photo: NewsCom: AP=20 Archive: http://photoarchive.ap.org PRN Photo Desk 888-776-6555 or=20 212-782-2840=20 Company News On-Call: or fax=20 800-758-5804 ext. 419090=20 Web site: http://www.reliantenergy.com (REI)=20 By Kathleen McFall kmcfall@ftenergy.com President George W. Bush's energy package encourages the use of biomass fue= ls=20 for both transportation purposes and electricity generation. They can=20 provide a reliable source of energy at a stable price and they can also=20 generate income for farmers landowners and others who harness them his= =20 administration's report said.=20 Despite this warm and fuzzy language however the administration offered n= o=20 tangible funding for the fledgling biofuels industry=01*other than an exten= sion=20 of an existing ethanol tax credit that was not due to expire until 2007=01*= a=20 significant disappointment and surprise to advocates of renewable=20 transportation fuels. The report did recommend expanding tax credits for biomass energy projects = to=20 include forest-related and agriculture fuel sources and threw its weighty= =20 support at a new credit for electricity produced from biomass co-fired with= =20 coal. These recommendations are already included in the president's 2002=20 budget.=20 We are pleased that the administration included expansion of the biomass t= ax=20 credit and hope that with congressional leadership we will see this=20 expanded provision signed into law this year said Katherine Hamilton=20 co-director of the American Bioenergy Association (ABA).=20 Unlike other portions of the recommended energy policy biomass energy=20 probably will not suffer under the recent change in Senate composition giv= en=20 Senate Majority Leader Tom Daschle's (D-S.D.) agricultural constituency and= =20 his previous support of the biofuels industry.=20 According to the National Energy Policy Development report biomass account= s=20 for about 76% of non-hydropower renewable electricity generation=20 representing a total of about 1.6% of total U.S. electricity supply.=20 Biopower advocates however envision an even greater market penetration in= =20 the coming decades and point to its environmental and ancillary advantages.= =20 For example given that biomass combustion can be carbon dioxide-neutral (i= f=20 the growth and use cycle is managed sustainably) environmental groups=20 support an expanded role. Farmers with marginal lands that could grow bioma= ss=20 fuel could enjoy economic benefits. With large amounts of wood residue the= =20 forest industry also stands to benefit from wider use of wood as a power=20 source.=20 Renewable energy offers a particular advantage to the lumber and paper=20 industry and many analysts project that the industry may soon become a net= =20 seller of electricity.=20 In the lumber and paper industries wood scraps are sometimes directly fed= =20 into boilers to produce steam for their manufacturing processes or to heat= =20 their buildings. For that reason renewable energy offers a particular=20 advantage to the lumber and paper industry and many analysts project that= =20 the industry may soon become a net seller of electricity said the energy= =20 policy report.=20 Co-firing with coal Biomass=01*usually wood or wood residue=01*has traditionally been burned di= rectly=20 in the industrial sector for heat or on-site electricity generation.=20 According to the U.S. Department of Energy (DOE) the existing 10 GW of=20 installed capacity are based on this direct-combustion technology.=20 For utilities and power-generating companies with coal-fired capacity=20 however biomass co-firing may represent one of the least-cost renewable=20 energy options said the DOE. The process involves blending different=20 materials in varying amounts with coal.=20 Not only does mixing biomass with coal reduce emissions it is likely to be= =20 cost-effective. Southern Co. estimates that a biomass plant alone could=20 generate power depending on its location at 4 to 11 cents/kWh. Given that= =20 the lower range of this corresponds to coal generation costs there are=20 clearly circumstances where biomass-coal co-firing would be economically=20 attractive today. Plus the environmental public relations benefit for=20 utilities with coal-fired capacity would be valuable.=20 Domestic biomass generation capacity could reach 20-30 GW by the year 2020 = by=20 co-firing at existing U.S. coal-fired power plants.=20 According to a recent report prepared by five National Laboratories domest= ic=20 biomass generation capacity could reach 20-30 GW by the year 2020 by=20 co-firing at existing U.S. coal-fired power plants.=20 A recent report by the United Nations Intergovernmental Panel for Climate= =20 Change (IPCC) also cites the potential of coal co-firing with biomass. The= =20 IPCC report concludes that co-firing in coal boilers results in the lowest= =20 cost and least technical risk of the examined approaches for biomass=20 conversion to electricity.=20 Working out the technical kinks Already said the DOE six power plants in the U.S. are currently co-firing= =20 coal and wood residue products on a regular basis. Another 10 plants have= =20 successfully tested co-firing over the last decade and at least six more= =20 plants are now conducting or planning tests.=20 For example Southern Co. is working with DOE the Southern Research=20 Institute and the Electric Power Research Institute to study ways to grow a= nd=20 harvest switchgrass to blend with coal as a fuel for power generation.=20 Ideally suited for the southeastern U.S. switchgrass is a rugged grass tha= t=20 can be grown on marginal agricultural land. Reaching heights of up to 12=20 feet it requires little fertilization and herbicide and can be harvested= =20 twice a year.=20 Harvesting methods co-milling of switchgrass and pulverized coal=20 pilot-scale co-firing tests and a full-scale demonstration of co-firing at= =20 Alabama Power Co.'s Plant Gadsden are part of Southern Co.'s collaborative= =20 project.=20 The U.S. Agriculture Department is also taking a role in exploring the=20 potential of biomass and coal co-firing as a means to give farmers new=20 markets especially for currently idle land. The agency recently authorized= =20 funding for three co-firing demonstration projects.=20 In Iowa the Chariton Valley Biomass Project is a cooperative effort to=20 develop warm and cool season grasses (such as switchgrass) to co-fire with= =20 coal at Alliant Energy's Ottumwa Generating Station. The project is designe= d=20 to generate a sustained supply of 35 MW of biomass energy. Eventually the= =20 grass could substitute for as much as 5% of the coal currently burned at th= e=20 plant.=20 In addition to reducing coal emissions the Chariton Valley Biomass Project= =20 will support the local farm economy.=20 In addition to reducing coal emissions the project will support the local= =20 farm economy because the grass and trees will come from acreage taken out o= f=20 production under the Agriculture Department's Conservation Reserve Program= =20 (CRP). CRP land is generally marginal land that the government subsidizes= =20 farmers to leave idle to both prevent erosion and protect commodity prices= =20 from product surpluses.=20 The Pennsylvania Switchgrass Energy and Conservation Project will produce= =20 switchgrass on CRP land for sale to a local cooperative's coal-fired=20 fluid-bed combustors.=20 In New York the Agriculture Department project will fund willow biomass=20 crops and switchgrass on CRP acreage in the central and western part of the= =20 state. The primary markets for the willow biomass are two coal-burning powe= r=20 plants and a small university central heating facility.=20 Land conflicts transportation may be obstacles As these pilot projects illustrate biomass conversion efforts may have the= =20 most significant potential in rural areas. Since biomass is widely=20 distributed it has good potential to provide rural areas with a renewable= =20 source of energy. The challenge is to provide =01( conversion and delivery = of=20 bioenergy to the marketplace in the form of modern and competitive energy= =20 sources said the IPCC report.=20 A potential drawback to co-firing is transportation. Transportation of=20 wood-based energy products is more costly per unit of energy than coal f= or=20 example and most analysts believe it will prove most economical to site=20 generation plants near biomass sources.=20 The generating plant or biorefinery must be located near to the resource t= o=20 minimize transport costs of the low-energy-density biomass as well as to=20 minimize impacts on air and water use the IPCC report said. However note= s=20 the report's authors economies of scale may be significant enough to offse= t=20 the transport costs involved.=20 A potential drawback over the long term however for biomass conversion is= =20 land use conflicts. The IPCC report notes that by 2100 the global land=20 requirement to feed the growing world population will increase substantiall= y.=20 Up until this time there may well be sufficient land to supply all demands= =20 for food fibre and energy but at some stage after that land-use conflict= s=20 could arise and before that competition for water and irrigation may be a= =20 constraint.=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential - Notes from Portland Visit Body:: David I will have this re-reviewed by Oregon counsel but it was scrubbed about 18-24 months ago as being enforceable. Thanks. Michelle What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: EPSA/EEI on Reliability Body:: Charles -- Thanks for the reply. Your thoughts on the EEI draft in terms of details would be helpful. As I read it we still have the problems with the EEI draft that we had with the NERC draft on which it is based -- deference regional rules variances regional reliability entities regional advisory boards limits on FERC authority etc. etc. It would also be helpful to have input on whether the plans for EISB could go forward if legislation like the EEI bill were enacted into law. It would seem not since the SRO would focus only on reliability as defined by how the bill defines what matters are subjects for an organization standard. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: All-Employee Meeting Report Body:: We have got to do better at this. IR did a webcast of the annual meeting that from all reports had a minimum of glitches. Can we use the same technology? Courtney Votaw 03/13/2001 09:10 AM To: Steven J Kean/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON cc: Mary Clark/Corp/Enron@ENRON Erin Rice/Corp/Enron@Enron Subject: All-Employee Meeting Report I have attached a success report of the streaming communications vehicles we used for the All Employee meeting on Feb. 21 2001. The report includes information about the following: Video Teleconference Audio and Video quality Viewing employees IP-TV Statistics Successes of the locations streamed Video Requests Quantity by location and group To improve access and increase the employee's viewing experience at future meetings we are working with the IP-TV technical team to find solutions to the problems that occurred in February. From the employee feedback we received we will plan to send slides in advance to the video teleconference locations. Please let me know if you have any questions regarding this report. Thanks Courtney What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Government Affairs off-site presentations June 2000 Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Governor Ridge might call Ken Lay today Body:: FYI. These are the items I left Ken a voicemail about. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ken lay tour Body:: I have advised against Ken or Jeff attending the generators meeting: Ken is still willing to make time avail on the 3d to meet with the gov. From: Susan M Landwehr on 04/29/2001 05:04 PM To: Richard Shapiro/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Jeff Dasovich/NA/Enron@Enron Maureen McVicker/NA/Enron@Enron Steven J Kean/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT cc: Subject: Re: ken lay tour All--here's some thoughts on the RGA related events. We currently have Ken scheduled to participate in an energy roundtable discussion on the afternoon of the 2nd with at least four governors attending that session--Kempthorne Hull Geringer and Ridge. (Engler and Rowland are also attending the overall event but they will be in a healthcare breakout session). Kaufman and I thought that it would be particularly helpful for Arizona Gov Hull and Idaho Gov Kempthorne to hear Ken's remarks and have a chance to talk with him. I have also been working with Rosalee to schedule an early evening (6:00-7:00pm) meeting that night with Exelon co CEO John Rowe. John Rowe will be in California for some investor meetings and well as attending some sections of the RGA events. I have told my counterpart at Rowe's office that we would confirm Ken's availability on Monday morning. If you do decide that Ken should attend the Davis meeting in Sacremento that day instead we will just reconfigure a bit. Paul and I will cover the RGA events and I will cancel the John Rowe get together. I would also want to talk about having Mr. Lay reach out to Hull and Kempthorne via phone sometime in the near future. Same with Rowe. Rosalee Fleming 04/27/2001 07:12 PM To: Janel Guerrero/Corp/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Jeff Dasovich/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Steven J Kean/NA/Enron@Enron Sherri Sera/Corp/Enron@ENRON Susan M Landwehr/NA/Enron@Enron Subject: Re: ken lay tour I received a return call from Lelanie in Governor Davis' office this evening. She said the Governor wanted to invite Ken Lay and Jeff Skilling to a meeting the Governor is having at 2:00 p.m. in Sacramento on May 2 with a lot of CEOs. I still pressed for a one on one meeting on May 3 in Sacramento but she told me the Governor wanted to have the one meeting all at once and his schedule was very tight on Thursday May 3. I transferred her to Sherri and called Ken. Ken wanted me to try to get more specific information which she shared that it is with generators - Sempra Williams CalPine Duke Dynegy and Reliant. She also said since the Governor has worked with Ken she thought he might prefer that he attend. Ken said to let you all know and be thinking whether we even want to do it. He said one thought might be that he'd do that meeting and maybe Jeff could do the one in L.A. on May 2. Talk to you Monday. Rosie Janel Guerrero 04/27/2001 02:39 PM To: Rosalee Fleming/Corp/Enron@ENRON Maureen McVicker/NA/Enron@Enron Jeff Dasovich/NA/Enron@Enron cc: Richard Shapiro/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Subject: ken lay tour Just so we're all on the same page......Dasovich will arrive in Houston on Monday (mid-day) and will travel with Dr. Lay beginning on Wednesday (to Austin) and then on to LAX Sacramento etc. Steve said there really isn't time to have a pre-briefing so any questions that Ken has will have to be addressed enroute to CA. Rosalee....we're giving Steve the briefing book today so he can review over the weekend and we'll have a final copy to Ken before he departs next week. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - May - Env Strat Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Calif briefing What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Thank you Body:: thanks for your help in preparing for the Texas hearing. I think Texas legislators are viewing the California experience in the proper context and I think I was at least marginally articulate on the emissions issues as well. thanks again. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Press Clipping - Germany (Enron Mention) Body:: The quotes are accurate but I did not say California does not have a supply problem. Mark Schroeder@ECT 03/19/2001 06:04 AM To: Steven J Kean/NA/Enron@Enron cc: Jackie Gentle/LON/ECT@ECT Alex Parsons/EU/Enron@Enron Subject: Press Clipping - Germany (Enron Mention) Steve - FYI and presumably they misquoted you on the problem (at least in California) not being a function of indaequate capacity (it is one of the root causes we have been pointing to over here among others). mcs ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: FW: Body:: Return-path: From: VKaminski@aol.com Full-name: VKaminski Message-ID: Date: Tue 13 Nov 2001 21:03:34 EST Subject: Fwd: FW: To: VKaminski@aol.com MIME-Version: 1.0 Content-Type: multipart/mixed X-Mailer: AOL 6.0 for Windows US sub 10539 Return-path: From: VKaminski@aol.com Full-name: VKaminski Message-ID: Date: Sun 11 Nov 2001 02:56:49 EST Subject: Fwd: FW: To: VKaminski@aol.com MIME-Version: 1.0 Content-Type: multipart/mixed X-Mailer: AOL 6.0 for Windows US sub 10539 Content-Transfer-Encoding: quoted-printable Return-Path: Received: from rly-xf05.mx.aol.com (rly-xf05.mail.aol.com [172.20.105.229]) by air-xf01.mail.aol.com (v81.9) with ESMTP id MAILINXF110-1019180521 Fri 19 Oct 2001 18:05:21 -0400 Received: from postmaster.enron.com (outbound5.enron.com [192.152.140.9]) by rly-xf05.mx.aol.com (v80.21) with ESMTP id MAILRELAYINXF57-1019180459 Fri 19 Oct 2001 18:04:59 -0400 Received: from corp.enron.com [192.168.110.110]) by postmaster.enron.com with ESMTP id f9JM4w304754 for Fri 19 Oct 2001 17:04:58 -0500 (CDT) Received: from nahou-mscnx04p.corp.enron.com (unverified) by corp.enron.com (Content Technologies SMTPRS 4.2.1) with SMTP id for Fri 19 Oct 2001 17:04:58 -0500 Received: from NAHOU-MSMBX03V.corp.enron.com ([192.168.110.40]) by nahou-mscnx04p.corp.enron.com with Microsoft SMTPSVC(5.0.2195.2966) Fri 19 Oct 2001 17:04:58 -0500 X-MimeOLE: Produced By Microsoft Exchange V6.0.4712.0 content-class: urn:content-classes:message MIME-Version: 1.0 Content-Type: text/plain charset=iso-8859-1 Subject: FW: Date: Fri 19 Oct 2001 16:34:52 -0500 Message-ID: X-MS-Has-Attach: X-MS-TNEF-Correlator: Thread-Topic: Thread-Index: From: Kaminski Vince J To: Lin Martin Cc: X-OriginalArrivalTime: 19 Oct 2001 22:04:58.0864 (UTC) FILETIME=[17D6F700:01C158EA] X-Mailer: Unknown (No Version) Martin Lance What do you think? Vince > What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential - Mike Miller Body:: Elspeth do we want to do a new agreement or simply assume the obligations in the old one? If the former I'd do a new agreement. If the latter I believe I simply can do an assignment agreement once I receive a copy of the current agreement. It also depends on the language in the old one and whether we believe it protects ENA. So we'd have to look at it. Sharon do you have the file on this person? If so let me know and I will have someone come and pick it up. Thanks. Michelle Elspeth Inglis@ENRON on 04/14/2000 04:56:09 PM To: Michelle Cash/HOU/ECT@ECT cc: Subject: Confidential - Mike Miller Michelle when rolling over an employment contract from another Enron entity is it re-issued with same details but under ENA's name? thanks Elspeth ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Thu evening Body:: Thanks. Confirmed. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: examples of auction processes that worked Body:: Jeff Skilling proposed a solution to Gov Davis to solve the supply and pricing problems in the California market. In summary the proposal would have a neutral party conduct an auction wherein the utilities would seek bids for 5-10 year packages of power from suppliers. The gov asked if anyone had successfully conducted such an auction in the industry already. I need your help to identify and describe any such examples (European or North American) by mid day Monday. Jeff and I will have a follow up call with the governor on Monday. Thanks What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Privileged and Confidential -- website Body:: FYI the attached article and story is disturbing and surprising about Southern Company. It also raises an issue that we could face if we are not careful. The article discusses internal diversity studies which the plaintiffs are using as evidence to support their claims. The company claims that the studies were done by people who did not know how to conduct the appropriate analyses under the relevant legal standards. I have this concern here as well when we have people running analyses that do not factor in the legal standards and instead try to interpret data themselves. I would like to talk about how to manage that. Let me know who you think should be included in such a meeting and I'll set something up. Thanks. Michelle What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I talked to Hettie today. It's unlikely that we are going to find time for Jeff and the Governor to talk (because of the Governor's schedule). We'll try to set something up later. In the meantime the Governor should just sign the bill. Of course Hettie had already communicated this the Gov's office acknowledged that the message was recieved but did not make a specific commitment. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: http://www.vaionline.it/ Body:: http://www.vaionline.it/ What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: The conversation was very positive (Glynn did not know anything about it at first but looked into it and called Ken back Friday evening). Glynn said they were including the amount owed in their negotiations over the price for the transmission assets and said they intended to pay all of their debts including this one as soon as they get paid. He said that this weekk would be focussed on finalizing a deal for SCE given the threat of bankruptcy the discussions would then turn to PG&E. Jeff Dasovich Sent by: Jeff Dasovich 03/14/2001 07:03 PM To: skean@enron.com cc: Subject: Steve: Jim mentioned that Ken Lay was trying to talk to Glynn today about getting the PX credit issue resolved. Any progress made? Best Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Some funnies Body:: ----------------- What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Attorney Client Privilege - Attorney Work Product Body:: I have drafted the attached letter denying the Cal ISO's request to send it (and the EOB) EPMI and EES' cost information for transactions over the FERC's cost cap. Since I believe we are on very firm ground my initial inclination was to send no response to the ISO's letter so there would be nothing to quote in the press. However I drafted this letter at Alan's suggestion for purposes of discussion. We should decide whether to send a letter before distributing this draft more widely in-house to discuss how to parse the message. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: DRAFT Slides for Sempra Meeting Body:: I think the presentation looks good. In the meeting itself I think you should go heavy on the argument that it makes no sense for Sempra shareholders to be in a commodity market as a regulated entity -- the heads they win tails you lose argument. Jeff Dasovich Sent by: Jeff Dasovich 10/13/2000 06:11 PM To: skean@enron.com Richard Shapiro/NA/Enron@Enron James D Steffes/NA/Enron@Enron Sandra McCubbin/SFO/EES@EES Mona L Petrochko/SFO/EES@EES Susan J Mara/SFO/EES@EES Paul Kaufman/PDX/ECT@ECT cc: Subject: DRAFT Slides for Sempra Meeting Attached for your review is a rough cut at slides we're preparing for the meeting with Sempra next Thursday. Thoughts and comments are appreciated. Please disregard korny title. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Wyden Bankruptcy Amendment Body:: The amendment was defeated Jeff Dasovich Sent by: Jeff Dasovich 03/14/2001 11:11 AM To: James D Steffes/NA/Enron@Enron Chip Schneider/Enron@EnronXGate Linda Robertson/NA/Enron@ENRON Richard Shapiro/NA/Enron@Enron skean@enron.com cc: Subject: Wyden Bankruptcy Amendment What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Tax Valuations for YR2000 Body:: Congratulations! Gary Fitch@ENRON on 07/27/2000 12:02:47 PM To: Bill Donovan/EPSC/HOU/ECT@ECT cc: Steven J Kean/HOU/EES@EES Subject: Tax Valuations for YR2000 Bill we hit a home run this morning with HCAD. They have agreed to take my reduced valuation on the Enron fleet. A reduction of $16079000 in taxable value. This results in savings of $482375. That's not all our allocation based on records for operations outside of the state of Texas resulted in additional savings of $1559638. Total savings to our 2000 budget will be $2042013. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Legislative Status Report Week Ending 4/20 Body:: Date: 4/20/01 To: Jan Smutny-Jones Steven Kelly Katie Kaplan Cc: IEP Board of Directors From: Julee Malinowski-Ball Edson + Modisette RE: Legislative Status Report Week Ending 4/20 RECENT EVENTS: -- IEP with the help of Chris Ellison has been at the negotiating table mos= t of the week dealing with the most recent amendments to SB 28x. SB 28x (Sher/Battin) makes various changes to the siting process including many IEP-sponsored proposals. As you will recall two new provisions were added to the bill at the last minute before going to the Assembly Floor dealing with both retrofit schedules and environmental dispatch of generating facilities. Per the direction from IEP member companies IEP has decided not to negotiate on the environmental dispatch issue. If the provision remained in the bill IEP would continue to push the Republicans to hold their opposed position. We were however given the authority to negotiate on the retrofit issue as long as we were only talking about facilities that already have retrofit requirements. I will be faxing out the agreed upon language which in essence says the ARB shall set a schedule for the completion of any mandated retrofits. It does not expand the authority of the air districts and ARB to mandate retrofits under existing law. The schedule would require completion of the retrofits by July 1 2004 or such later date as the ISO determines is necessary to maintain reliability. With these amendments including some clean-up language SB 28x will be voted-on on the Assembly floor on Monday and go to the Senate for concurrence on Tuesday. The final version will include the following IEP-sponsored proposals: ? Conforming the timing of offsets for power plants to Clean Air Act requirements ? Substituting CEQA-style hearings for the trial-like proceedings of the CE= C ? Streamlining the permit process for the modernization of existing power plant sites ? Giving consideration to the positive environmental impacts of a proposed project. ? Improving the timeliness and coordination of state and local agency review. ? Extending the current deadlines for the expedited review process established in AB 970. Since SB 28x is only a first step in making changes to the siting process IEP member should now be thinking about what is next. IEP proposals still on the table include: ? Permitting local agencies to make zoning changes or other decisions for power plants contingent upon CEC CEQA Compliance ? Giving deference to other state and regional agencies ? Easing the threshold for override of local land use requirements. ? Making the ISO responsible for determining interconnection requirements -- Bad news on the =01&California First=018 issue quickly followed the good= news. The CEC staff analysis which said the State can't require builders of new power plants to sell electricity here even as a trade-off for expedited permitting was countered by another staff analysis that says the state can= . Both documents cannot be obtained due to attorney-client privilege. This issue is coming to a head next week with a decision pending by the CEC to include a California First clause on the approval of an expedited AES power plant project. AB 60x (Hertzberg) which ties to the siting process the requirement that a developer enter into a contract to sell power to specified California entities is still poised to be heard in the Senate Energy committee. IEP members company lobbyist should continue to lobby against this measure regardless of the CEC=01s decision on AES although our arguments are definitely strengthened if the addition of the clause at the CEC is denied. -- IEP has finalized negotiations with Senator Burton=01s office on amendm= ents attempting to solve our problem with the eminent domain provision in SB 6x (Burton) which is the State Power Authority measure. Attached is a copy o= f the bill in PDF form. The agreed upon language which clarifies that the Authority=01s purpose is to supplement existing generation activities can= be found on pages 6-7 (Section 3310) 13 (Section 3341.1) and 16-17 (Section3352). Considering the inflammatory remarks made by Senator Burton in the press lately regarding seizing generation assets this was most likely the best we could get. -- The first of Senator Dunn=01s hearings with the Senate Select Committee= to Investigate Price Manipulation of the Wholesale Market occurred this week. This week and next week=01s topics will be to go over previous investigati= ons into market power. The committee heard or will be hearing testimony from: Frank Wolak Chairman Market Surveillance Committee CAISO Eric Hildebrandt Manager Market Monitoring CAISO and Elaine Howle State Auditor. -- The Assembly Electricity Oversight Subcommittee met this week and focused on the issue of natural gas collusion. Testifying before the committee were representatives from Dynegy and El Paso commenting on the rise of natural gas prices and whether illegal market manipulation and collusion occurred. The subcommittee plans on putting together a package o= f bills related to natural gas issues which would be the culmination of the committee=01s hearings over the last two months. This package will be up = for consideration first by the whole special Assembly Energy committee. -- Governor Davis came out this week supporting the construction of the Calpine Metcalf Energy Center the 600-megawatt power plant proposed for th= e San Jose region. The Governor urged the CEC to approve the plant siting so that construction can begin. -- Two long-term contracting bills are scheduled for hearings next week. IEP counsel is currently reviewing AB 57 (Wright) and SB 997 (Morrow) and will comment on their provisions as soon as possible. -- Attached is the most recent legislative tracking reports both the special session and regular session. Please let me know if you need copies of any of these bills. UPCOMING EVENTS: MONDAY April 23rd Assembly Utilities and Commerce Committee AB 57 (Wright) =01) long-term contracting reasonableness review TUESDAY April 24th Senate Energy Committee SB 997 (Morrow) =01) long-term contracting reasonableness review WEDNESDAY April 25th Assembly Appropriations Committee AB 62x (Cohn) =01) California First AB 63x (Florez) =01) Sale of Kern Power Plant THURSDAY April 26th Select Committee to Investigate Price Manipulation of the Wholesale Market Informational hearing on the overview of investigations studies and reports regarding the energy crisis. MONDAY April 30th Senate Appropriations Committee SB 1x (Soto) =01) excess profits tax Assembly Revenue and Taxation Committee AB 128x (Corbett) =01) excess profits tax ON THE ASSEMBLY FLOOR SB 6x (Burton) =01) State Power Authority SB 28x (Sher/Battin) =01) siting --end-- Julee Malinowski-Ball Senior Associate Edson + Modisette 916-552-7070 FAX-552-7075 jmball@ns.net - 2001 Tracking Report.doc - 2001 Tracking Report.special session.doc - What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions - 11/09/01-11/10/01 Body:: Rival to Buy Enron Top Energy Trader After Financial Fall The New York Times 11/10/01 Regulators Struggle With a Marketplace Created by Enron The New York Times 11/10/01 COMPANIES & FINANCE INTERNATIONAL - Dynegy agrees to $7.8bn rescue bid for = Enron. Financial Times 11/10/01 COMPANIES & FINANCE - INTERNATIONAL - Accountancy put back under the spotli= ght. Financial Times 11/10/01 LEX COLUMN - Layed to rest. Financial Times 11/10/01 COMPANIES & FINANCE INTERNATIONAL - Company troubles leave Houston with a p= roblem. Financial Times 11/10/01 Dynegy to acquire Enron in $8.9 billion stock deal / New giant moves out of= shadow Houston Chronicle 11/10/01 The Nation Smaller Rival to Acquire Teetering Enron Power: Energy giant tha= t pressed for deregulation in California is on the brink of collapse. Los Angeles Times 11/10/01 Dynegy to acquire Enron in $8.9 billion stock deal / New giant moves out of= shadow Houston Chronicle 11/10/01 POWER PLAY / Lay opened energy firms to work in new markets Houston Chronicle 11/10/01 POWER PLAY / Purchase elevates Watson's low profile Houston Chronicle 11/10/01 Dyenegy to acquire Enron in $8.9 billion stock deal / Many fear `unique' pr= oblems Houston Chronicle 11/10/01 Enron Accepts $8 Billion Buyout Offer From Dynegy Energy Giant Was Forced = to Negotiating Table After Disclosing That It Had Overstated Earnings The Washington Post 11/10/01 The Nation NEWS ANALYSIS A Visionary Fallen From Grace Los Angeles Times 11/10/01 DYNEGY TIMELINE Houston Chronicle 11/10/01 POWER PLAY / ENRON TIMELINE Houston Chronicle 11/10/01 POWER PLAY / Enron had been a political heavyweight / Critics decried influ= ence of Ken Lay in White House Houston Chronicle 11/10/01 POWER PLAY / Sale suddenly switches office outlook downtown Houston Chronicle 11/10/01 POWER PLAY / Enron Field name may fall as quickly as energy empire Houston Chronicle 11/10/01 Market forces: Worries over Royal Bank's Enron exposure The Guardian 11/10/01 Dynegy snaps up Enron for $9.5bn The Times of London 11/10/01 UK jobs on the line Daily Mail 11/10/01 Dynegy to get prime downtown real estate in Enron deal Associated Press Newswires 11/10/01 Enron India Pwr Unit Sale Faces Review After Dynegy Deal Dow Jones Energy Service 11/10/01 Talks to salvage multibillion dollar Enron India project goes into third da= y Associated Press Newswires 11/10/01 All eyes in electric industry on Texas as deregulation nears Associated Press Newswires 11/10/01 Enron Says It's Too Soon to Quantify U.K. Job Cuts (Update1) Bloomberg 11/10/01 Dynegy to Buy Enron for $23 Billion in Stock Debt (Update9) Bloomberg 11/09/01 Dynegy announces $8 billion deal to buy larger rival Enron Associated Press Newswires 11/09/01 USA: UPDATE 3-Dynegy to acquire Enron for $9 bln. Reuters English News Service 11/09/01 Enron not California's largest power supplier but merger could affect pric= es Associated Press Newswires 11/09/01 Dynegy-Enron merger could mean name change for Enron Field Associated Press Newswires 11/09/01 Dynegy Buy Of Enron Valued At $23B-$24B With Debt Dow Jones News Service 11/09/01 Chronology of Enron Corp.'s history Associated Press Newswires 11/09/01 Fitch Takes Rating Action on Enron & Dynegy on Merger News Business Wire 11/09/01 ChevronTexaco to Invest $2.5 Billion in Dynegy PR Newswire 11/09/01 Business/Financial Desk Section A Rival to Buy Enron Top Energy Trader After Financial Fall By ALEX BERENSON and ANDREW ROSS SORKIN 11/10/2001 The New York Times Page 1 Column 2 c. 2New York Times Company With its stock plunging and its finances in doubt the world's largest ener= gy trader the Enron Corporation agreed to be acquired yesterday by the ri= val Dynegy Inc. for about $9 billion in stock and the assumption of $13 bil= lion in debt.=20 The deal is an extraordinary turnabout for Enron a Houston-based company t= hat had been a driving force behind electricity deregulation nationwide. Its chairman Kenneth L. Lay a big contributor to the Republican Party pr= ovided political influence while its former chief executive Jeffrey K. Sk= illing helped create markets for the trading of electricity and natural ga= s. But last winter when California's effort to deregulate the electricity = market led to soaring power prices and rolling blackouts Enron was the sub= ject of much criticism and political anger.=20 Recent disclosures of discrepancies in Enron's financial statements and an = investigation by the Securities and Exchange Commission caused the shares t= o plunge this week to their lowest level in a decade. As other companies be= came wary of doing business with it Enron -- also facing a potential cash = squeeze -- apparently had little choice but to find a buyer and a deal was= hastily cobbled together this week.=20 For critics who had complained about Enron's market power and its dominance= the combination poses additional concerns. Dynegy's acquisition of Enron = will be reviewed by state and federal agencies led by the Justice Departme= nt and the Federal Energy Regulatory Commission. Analysts said today that t= hey expected scrutiny of the combined companies' holdings in California wh= ere Dynegy owns power-generating plants and Enron accounts for much of the = trading of natural gas -- fuel for the state's electric power plants.=20 Buying Enron at a deep discount -- it has lost $60 billion in market value = this year -- could make Dynegy the dominant trader of electricity and natur= al gas. But the agreement carries big risks as well. Along with Enron's gas= pipelines and high-technology trading floor Dynegy will take on Enron's s= ubstantial debt and a web of complex transactions that Enron has spun over = the last decade.=20 In addition to the $13 billion in debt that Enron carries on its books it = has guaranteed at least $4 billion in off-balance sheet loans and the hidd= en debt could total as much as $10 billion said Carol Coale a stock analy= st with Prudential Securities.=20 Charles L. Watson Dynegy's chairman and chief executive said yesterday th= at Dynegy could sort through Enron's tangled finances. ''We know the compan= y well'' Mr. Watson said. ''It's not like we just started fresh. I'm confi= dent that it's as solid as we thought it was.''=20 The new company will combine Enron's 25000-mile natural gas pipeline syste= m with the large number of power plants that Dynegy owns worldwide as well= as Illinois Power a Dynegy subsidiary that serves 650000 customers in Il= linois. But its most important asset will be its trading desk. It will be t= he largest energy trader in the nation trading more than twice as much pow= er and natural gas as its closest competitors.=20 Mr. Watson said the company did not expect to sell significant properties a= nd that the deal should pass regulatory scrutiny. ''There's really not a lo= t of overlap in assets'' he said.=20 Mr. Watson and Steve Bergstrom Dynegy's president will hold those positio= ns in the new company which will be called Dynegy and remain in Houston. M= r. Lay who created Enron in the mid-1980's will not have any role in the = combined company's daily operations. He has been asked to join its board bu= t has not provided an answer. ''The last three weeks haven't been a lot of = fun'' he said.=20 In a statement announcing the agreement yesterday afternoon Mr. Watson sai= d he was confident that the merger would produce a strong new company. ''En= ron is the ideal strategic partner for Dynegy'' Mr. Watson said. ''We will= keep a strong balance sheet and straightforward financial structure as key= priorities.''=20 To shore up Enron's finances Dynegy will immediately put $1.5 billion into= Enron through ChevronTexaco the giant oil company which already owns 27 = percent of Dynegy. Another billion dollars will be injected once the deal i= s completed.=20 Investors appeared comfortable yesterday that Dynegy could make the deal wo= rk. After falling $3 to $33 on Wednesday when the companies first said t= hey were in discussions Dynegy rose $5.76 on Thursday and yesterday to clo= se the week at $38.76.=20 ''On paper it works'' Ms. Coale of Prudential said. ''The combined compan= y would be the leading trader the market leader in most of their businesse= s.'' Ms. Coale who has a sell rating on Enron and a buy rating on Dynegy = said she planned to keep her buy rating on Dynegy.=20 As it works to have the deal approved Dynegy will have to persuade Enron's= traders to stay with the combined company. The pain of the stock's 90 perc= ent plunge this year will not be equally shared. Some Enron employees have = held onto their shares and seen their retirement accounts eviscerated. Mean= while Mr. Lay Mr. Skilling and other former and current executives sold h= undreds of millions of dollars in Enron stock in 2000 and this year.=20 The companies also have very different corporate cultures. Dynegy emphasize= s teamwork while Enron is more competitive said Ehud Ronn director of th= e Center for Energy Finance Education and Research at the University of Tex= as. Even before the merger was announced Enron had lost some of its employ= ees to other energy trading companies Mr. Ronn said.=20 Some investors and analysts say that the problems with Enron's finances may= extend beyond the partnerships that have been the subject of Wall Street's= scrutiny the last month. James Chanos a short-seller who has been one of = Enron's most vocal critics said there was increasing evidence that Enron's= energy trading operations were not as profitable as the company had said. = ''There appears to be a culture at Enron of aggressively booking profits an= d deferring or obscuring losses'' Mr. Chanos said.=20 On Thursday Enron said in a filing with the S.E.C that it had overstated i= ts earnings by almost $600 million over the last five years. Mr. Chanos sai= d more restatements were possible noting that the filing disclosed partner= ships had been used to hedge almost $1 billion in losses in 2000 and this y= ear. So far the losses from those partnerships remain off Enron's financia= l statements Mr. Chanos said.=20 Enron's stock had been under pressure for most of this year as the company= ran up large losses with failed efforts to expand outside its core trading= operation. In August Mr. Skilling resigned as chief executive and Mr. La= y resumed control of daily operations.=20 Still the company appeared financially sound until last month when it dis= closed that its shareholders' equity a measure of the company's value dro= pped by $1.2 billion because of deals disclosed only hazily in its financia= l statements. The announcement unnerved investors who wondered whether Enr= on had found ways to inflate its profits and move debt off its balance shee= t and led the S.E.C. to begin an investigation.=20 Mr. Lay tried to reassure investors that Enron's finances were in order and= that its businesses remained strong. But the last three weeks have brought= a series of damaging revelations about partnerships that Enron formed with= some of its top executives including its former chief financial officer = Andrew S. Fastow.=20 With questions mounting the major credit-rating agencies began to downgrad= e Enron's debt putting additional pressure on the company. If Enron's debt= rating falls below investment grade it would be forced to repay $3.3 bill= ion in loans that it had guaranteed.=20 To strengthen its balance sheet and bolster its stock Enron turned to big = investors like Warren E. Buffett in search of billions of dollars of financ= ing. When the financing did not quickly appear its stock fell further.=20 By this week some major energy traders were refusing to extend credit to E= nron worrying that the company would be unable to make good on its contrac= ts. The Mirant Corporation an Atlanta-based power plant owner and electric= ity trader sharply curtailed its trading with Enron this week. ''We're tra= ding with them on a very limited basis'' said James Peters a Mirant spoke= sman. ''It's not business as usual.''=20 On Wednesday Enron's stock fell as low as $7 a share its lowest level in = more than a decade. That day news of the Enron and Dynegy talks leaked out= .=20 By late Wednesday the boards of the two companies had tentatively agreed t= o a deal. But Dynegy refused to go ahead until it learned whether Enron's c= redit rating would remain investment grade and was comfortable with the eff= ect of the deal on its own rating. The deal moved forward yesterday after D= ynegy was assured Enron's debt was not in danger of being lowered to junk s= tatus soon after the deal was announced according to company officials.=20 Dynegy and Enron had provided Standard & Poor's and Moody's Investors Servi= ce the main credit agencies with statements showing them what a combined = company might look like and asked the ratings agencies for an expedited rev= iew of the transaction Mr. Watson said.=20 Under the deal Enron shareholders will receive 0.2685 share of Dynegy stoc= k for each Enron share or $9.80 based on Dynegy's closing price on Thursda= y. Enron's stock gained 22 cents yesterday to $8.63.=20 ''I never thought our stock price would be at this level'' Mr. Lay said ye= sterday.=20 Enron's shareholders will own only 36 percent of the combined company and = Dynegy will name at least 11 members of the company's 14-member board.=20 If the deal falls apart Enron or Dynegy will have to pay a breakup fee of = $350 million.=20 To protect Dynegy's and ChevronTexaco's cash infusion the money will go to= an Enron unit that owns the Northern Natural Gas Pipeline. If the merger i= s not completed Dynegy will have the right to buy the unit.=20 An army of bankers and lawyers advised the companies. Lehman Brothers Inc. = acted as financial adviser and Baker Botts and Akin Gump Strauss Hauer &= Feld acted as counsel for Dynegy. J. P. Morgan & Company and Salomon Smith= Barney acted as financial advisers for Enron and Vinson & Elkins and Weil= Gotshal & Manges acted as the company's counsel. Pillsbury Winthrop served= as counsel to ChevronTexaco. Chart: ''A Marriage of Strength and Weakness'' A merger of Enron and Dynegy= would bring together two of the country's biggest energy companies -- and = save Enron from potential collapse. Graph tracks the weekly closes of Enron= shares from 1999 through 2001. Top North American gas marketers SALES OF = BILLION CUBIC FEET PER DAY* Enron: 24.6 Reliant: 13.2 Duke Energy: 12.8 BP:= 12.3 Mirant: 11.8 Dynegy: 10.9 Top North American power marketers SALES O= F MILLION MEGAWATT HOURS* Enron: 212.5 American Electric Power: 134.5 Duke = Energy: 118.1 Reliant Resources: 86.1 PG&E National Energy Group: 73.2 Dyne= gy: 70.1 *Figures are for the 2nd quarter of 2001. (Sources: Bloomberg Fina= ncial Markets Simmons & Co. Natural Gas Week)(pg. C2)=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Business/Financial Desk Section C Regulators Struggle With a Marketplace Created by Enron By JEFF GERTH with RICHARD A. OPPEL Jr. 11/10/2001 The New York Times Page 1 Column 2 c. 2001 New York Times Company WASHINGTON Nov. 9 -- For years the Enron Corporation used its political m= uscle to build the markets in which it thrived pushing relentlessly on Cap= itol Hill and in bureaucratic backwaters to deregulate the nation's natural= gas and electricity businesses.=20 Its achievement as one Enron executive said today in creating a ''regulat= ory black hole'' fit nicely with what he called the company's ''core manage= ment philosophy which was to be the first mover into a market and to make = money in the initial chaos and lack of transparency.'' Now Wall Street's dissatisfaction with Enron's secretive ways has delivere= d the company into the arms of its much smaller Houston rival Dynegy Inc.= in a deal worth about $9 billion in stock and the assumption of $13 billio= n in debt. The combination of the two companies energy experts and lawmake= rs said today poses a novel set of challenges for regulators still struggl= ing to grasp the complexities of the marketplace that Enron invented.=20 ''We're in a supersonic-speed era of electronic trading with a horse-and-bu= ggy-era regulatory system to protect consumers'' said Representative Edwar= d J. Markey a Massachusetts Democrat who has devised legislation to close = the regulatory gap.=20 Dynegy's acquisition of Enron is expected to be reviewed by numerous state = and federal agencies led by the Justice Department the Federal Trade Comm= ission and the Federal Energy Regulatory Commission.=20 Analysts said today that sharp scrutiny would be given to the combined comp= anies' holdings in California where Dynegy owns generating plants and Enro= n controls a large part of the market for trading natural gas -- the fuel f= or a big share of the state's electric power plants.=20 ''Dynegy would now have a greater ability to take the dominant position in = gas and raise the price of electricity'' said Frank Wolak a professor of = economics at Stanford University.=20 Mr. Wolak a consultant to the Justice Department on a 1999 antitrust case = that led to limits on another merger of electricity and natural gas compani= es in Southern California said he was skeptical that regulators were up to= the task of reviewing today's deal.=20 The transaction ''is something the Department of Justice needs to look at = and they are going to have a hard time looking at'' Mr. Wolak said. ''And = it's beyond the ability of the F.E.R.C. to look at.''=20 Pat Wood -- named chairman of the federal energy commission earlier this ye= ar with the backing of Kenneth L. Lay the chairman of Enron -- acknowledge= d in an interview today that the agency had ''a long way to go'' in matchin= g the sophistication of the companies it regulates.=20 But he said that the commission had made great strides in grappling with th= e new risk management techniques pioneered by Enron Dynegy and other energ= y companies. It is hiring more experts he said adopting more restrictive = rules on how much ''market power'' one party can control and requiring more= disclosure of certain energy transactions.=20 In an interview this evening Charles L. Watson the chairman of Dynegy sa= id he did not believe that regulators reviewing the deal with Enron would r= equire the sale of any assets. ''We haven't really identified any pitfalls = that require any sort of asset divestiture'' he said. ''There's not really= any overlap.''=20 A senior executive at one of Enron's largest energy-trading rivals disagree= d. ''I don't think this deal gets through unscathed'' he said today. ''I'm= sure the Justice Department and the F.T.C. will look closely at the pretty= substantial concentration of market power these companies will have in the= energy-trading area.''=20 Enron is mainly a trader of natural gas and electricity -- indeed the bigg= est player in both those markets -- and it also owns a network of gas pipel= ines. Dynegy processes and sells natural gas and generates and sells electr= icity. Each company owns a local electric utility too: Dynegy owns Illinoi= s Power in Decatur Ill. while Enron owns Portland General Electric in Por= tland Ore. but last month announced plans to sell it to another Oregon ut= ility.=20 For a decade as it transformed itself from a gas pipeline operator into th= e nation's biggest energy trader Enron enjoyed unalloyed lobbying success = in Washington and the enthusiastic backing of Wall Street.=20 In the early months of the Bush administration Mr. Lay -- whose company wa= s one of the biggest financial backers of George W. Bush's presidential cam= paign -- played a prominent and some said unusual role in helping the Whi= te House pick nominees to the federal energy commission. Enron executives m= et with Vice President Dick Cheney whose energy task force backed many of = the deregulatory initiatives pushed by Mr. Lay.=20 Now ''the company has become a pariah'' an Enron executive said today. ''= The Bush administration doesn't want to have anything to do with us.''=20 The problems began with the energy crisis in California where Enron's outs= poken defense of deregulation even more than its electricity trading activ= ities made the company a favorite whipping boy of politicians and consumer= advocates. In the financial markets meanwhile Enron's confusing disclosu= res tolerated when its stock was soaring drew disdain as the calming of t= he energy storms in California and other parts of the country beat the shar= es down starting last spring.=20 ''Enron fell victim to their own inconsistencies on transparency'' Mr. Wol= ak said. As California officials sought to understand why energy prices had= soared out of control he said Enron's ''view was that we want everybody'= s data but if you want ours get a subpoena.''=20 Energy executives and regulators said that sort of arrogance had long marke= d Enron's attitude about government oversight.=20 Electricity sales had for decades been the job of local utility companies = operating as monopolies and selling power at regulated rates within their s= ervice areas. A few entrepreneurs led by Mr. Lay conceived a different mo= del in which power could be sold by generators or middlemen to big corporat= e users or utilities in faraway regions at whatever price the market would= bear.=20 In the early 1990's Congress -- under heavy lobbying by Enron -- passed le= gislation that began to open up electricity sales to marketers. Before long= Enron became one of the first companies to receive government approval to= sell electricity at market rates. The market for interstate sales of natur= al gas had been freed up a few years earlier and critics complained that t= raders like Enron were gleaning their profits by stoking volatility in gas = prices.=20 In the mid-1990's independent gas producers backed legislation in Congress= to allow the creation of a co-operative marketing organization which the= y hoped would have helped stabilize prices.=20 Raymond Plank the chairman of the Apache Corporation a gas producer based= in Houston said that the big gas marketing and trading companies includi= ng Enron successfully lobbied to kill the plan leaving prices as volatile= as ever.=20 ''It was a great concept'' Mr. Plank said. ''We could have headed off the = problems we have today.''=20 Enron's final lobbying success came last year. With a strong push from the = company's lobbyists Congress passed futures trading legislation that exemp= ted Internet energy trading platforms like EnronOnline the industry leader= from oversight by the Commodity Futures Trading Commission. Enron takes t= he other side of trades on its exchange. In traditional markets like the Ne= w York Mercantile Exchange which remain subject to oversight the exchange= acts as a middleman between buyers and sellers.=20 Under Mr. Watson Dynegy has been less of a pathbreaker than Enron and tho= ugh California politicians denounced it too as a profiteer during the ene= rgy crisis most analysts say it has been less aggressive than Enron in bot= h its business practices and its lobbying.=20 Indeed the rival energy-trading executive today predicted ''a huge culture= clash'' as the Houston neighbors merge. ''Blood will flow in Houston over = the integration of the trading operation'' he said.=20 But regulators may find Dynegy easier to deal with.=20 Earlier this year the federal energy commission asked for comments on whet= her it should tighten scrutiny of dealings between natural gas pipelines an= d energy-trading shops owned by the same company.=20 Enron wondered what all the bother was. ''Would stricter rules prevent real= affiliate abuse that current rules do not'' it wrote in a regulatory fili= ng ''or would they instead merely restrict the activities of some of the m= ore successful participants in the marketplace?''=20 Dynegy by contrast painted a grim picture and invited regulators to crack= down. ''Abuses abound'' it said ''because of financial windfalls diffic= ulty of detection lengthy investigations and increased complexity of the m= arket.'' Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 COMPANIES & FINANCE INTERNATIONAL - Dynegy agrees to $7.8bn rescue bid for = Enron. 11/10/2001 Financial Times (c) 2001 Financial Times Limited . All Rights Reserved THAL LARSEN.=20 Dynegy last night agreed a rescue bid of about $7.8bn for Enron after the = rival energy group narrowly escaped having its credit ratings cut to junk s= tatus. If successful the all-stock bid will allow Dynegy to take over a pioneer o= f energy trading that is many times its size in the electricity and gas mar= kets while also providing urgently-needed liquidity to the fallen star.=20 Dynegy offered almost 0.27 of its own shares per Enron share. Dynegy's stoc= k closed at $38.76 up 6.2 per cent yesterday valuing the bid at $7.8bn = or 21 per cent above Enron's closing price. Enron was up 2.6 per cent at $8= .63.=20 The combined company will also receive an immediate cash injection of $1.5b= n from ChevronTexaco which owns 27 per cent of Dynegy and a further $1bn = from ChevronTexaco when the deal closes.=20 The infusion is expected to avert a funding crisis caused by Enron's fallin= g trading volumes and its customers' demands for collateral which followed = a series of blows to its reputation.=20 Dynegy will use the $1.5bn infusion to acquire preferred stock collateralis= ed by Enron's pipeline assets in return ChevronTexaco will be granted righ= ts over $1.5bn of Dynegy stock.=20 JP Morgan Chase and Citigroup demanded similar security for a $1bn loan ext= ended this month.=20 Moody's Investors Service cut its rating on Enron's senior unsecured debt y= esterday morning from Baa2 to Baa3 - just one notch above junk status. Any = deeper downgrade would have forced Enron to sell stock to cover about $3.3b= n of obligations and could have deterred Dynegy. Moody's kept the ratings = under review for further downgrades given the potential for increased mar= gin requirements from counterparties.=20 However the agency said it would treat a substantial capital injection as = a stabilising event. The deal is likely to face intense regulatory scruti= ny given the large share the combined companies would have in the energy m= arkets.=20 The bid represents a reversal of fortune for Enron which will effectively = be humbled by its smaller Houston rival. However some analysts expressed r= eservations as Enron faces a Securities and Exchange Commission inquiry in= to off-balance sheet transactions and a restatement of its accounts has ye= t to clear up questions about the true state of its financial dealings.=20 Carol Coale of Prudential Securities said: We believe that either Dynegy= had material exposure to Enron's trading contracts or that it is trying to= rescue its competitor by saving the liquidity in the commodities markets.= =20 Reporting by Andrew Edgecliffe-Johnson and Robert Clow in New York Sheila = McNulty in Houston and Peter Thal Larsen in London .. See Lex.=20 (c) Copyright Financial Times Ltd. All rights reserved.=20 http://www.ft.com. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 COMPANIES & FINANCE - INTERNATIONAL - Accountancy put back under the spotli= ght. By ADRIAN MICHAELS and RICHARD WATERS. 11/10/2001 Financial Times (c) 2001 Financial Times Limited . All Rights Reserved Arthur Andersen Enron's auditor is understood to have approved the contro= versial off-balance sheet arrangements that lie at the heart of the energy = company's decision to overhaul its accounts earlier this week.=20 However in at least one case the auditor may not have been given full info= rmation while the involvement in the disputed transactions of four people = employed by Enron has only recently come to light. Andersen has already bee= n hit by lawsuits from Enron shareholders filed in Oregon and Harris County= Texas - a popular venue among plaintiffs' lawyers given its history of bi= g jury awards. The legal actions are the latest blow to an auditing profession still reeli= ng in the aftermath of a series of accounting scandals that have blown up i= n recent years. On Wednesday Waste Management said Andersen would pay $20m= to settle a suit brought by shareholders in the trash hauler alleging prof= essional malpractice. The Securities and Exchange Commission has already ag= reed a $7m settlement with Andersen over the alleged audit fraud.=20 The Enron actions could also turn out to be one of the first tests of new a= uditor independence rules set by the SEC. The energy company paid Andersen = $25m for its audit last year and $27m for other services.=20 An Andersen spokesman refused to comment on whether the auditor had vetted = the complex off-balance sheet arrangements used by Enron to manage its trad= ing risks and offload debt. However he added: We do help companies unders= tand accounting rules and how to apply them.=20 In a regulatory filing on Thursday Enron indicated that its decision to re= state its accounts to include two off-balance companies was based on curre= nt information suggesting that full details had not been available before= .=20 However a third accounting change was based on a new assessment Enron s= aid raising questions about the auditor's earlier judgement.=20 Under the previous commissioner Arthur Levitt the SEC attacked companies t= hat indulged in earnings management and accountants who suffered from con= flicts of interest between audit and consulting work. The accounting firms = say audit and consulting work can co-exist.=20 (c) Copyright Financial Times Ltd. All rights reserved.=20 http://www.ft.com. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 LEX COLUMN - Layed to rest. 11/10/2001 Financial Times (c) 2001 Financial Times Limited . All Rights Reserved Being in the business Dynegy should have a better idea than other possible= buyers of what it is taking on. Presumably it has been given a fuller and = franker explanation of Enron's off-balance-sheet mess than its investors b= ut it can scarcely have been able to carry out what normally counts as due = diligence.=20 Moody's decision and S&P's indecision meant Enron kept its investment grade= and seems to have got the deal done. Do ratings agencies really provide in= dependent analysis at these times? If Dynegy injects $1.5bn of cash up fron= t courtesy of Chevron Texaco and secured on the pipeline assets that aver= ts the immediate crisis. An exchange ratio of 0.27 would value Enron's stoc= k at $8bn. At about $10.67 a share that is a 27 per cent premium but more = pertinently compares with $34 on the eve of the October earnings call and $= 83 on New Year's Day. There are no rivals for this year's prize for shareho= lder value destruction. Others have gone but did Ken Lay Enron chief exec= utive know what was going on? Whatever the answer it reflects poorly on h= im. The merger raises antitrust questions. Dynegy might be a fifth of Enron's s= ize but it is the second biggest energy trader. But while Enron has few fr= iends in the public markets it still has some in high places. Dynegy's offe= r puts a floor beneath Enron's share price. Paying bottom dollar provides s= ome insurance for its shareholders. As more emerges on the financial struct= ure and the state of the core trading business the question is whether tho= se who declined the opportunity start to take an interest or pat themselves= on the back.=20 (c) Copyright Financial Times Ltd. All rights reserved.=20 http://www.ft.com. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 COMPANIES & FINANCE INTERNATIONAL - Company troubles leave Houston with a p= roblem. By SHEILA MCNULTY. 11/10/2001 Financial Times (c) 2001 Financial Times Limited . All Rights Reserved COMPANIES & FINANCE INTERNATIONAL - Company troubles leave Houston with a p= roblem - Energy trader has played a vital role in its home city writes She= ila McNulty.=20 When Sam Soliman senior vice-president of Koch Industries the second-larg= est privately held company in the US remarked earlier this year on the bui= lding boom in downtown Houston he could not help but be alarmed about the = city's prospects: I always get worried when I see a lot of new constructio= n. He was right to be so circumspect. In a matter of months three of Houston'= s corporate landmarks - Compaq Computer Continental Airlines and Enron - h= ave come under pressure.=20 Compaq is in the process of being acquired by Hewlett-Packard Continental = has had to lay off 12000 employees and energy trader Enron has gone from = being the leader of Houston's business community to its biggest liability.= =20 The fourth most populous city in the US is reeling from the latest demise a= mong its corporate citizens.=20 It's a body blow says Charlie Savino executive vice-president of the Gr= eater Houston Partnership a business organisation.=20 Enron is not only one of the city's biggest employers it has led the redev= elopment of downtown Houston making it somewhere pleasant to live for the = first time in decades.=20 At the centre of its efforts is the Enron Field which the company financed= to bring professional baseball - and its fans - back into the city centre.= =20 On the periphery are Enron's contributions to Houston's social development.= =20 The company matches all employee donations made to non-profit organisations= for up to $15000 per employee per year.=20 It also makes donations to non-profit organisations for which its employees= offer their time.=20 Kenneth Lay Enron chief executive has long been the go-to guy to get so= mething done in Houston.=20 Enron's status brought Houston status as the biggest energy trader in the = US it made the city the centre of energy trading. EnronOnline its interne= t trading platform has drawn some of the brightest minds to the city to wo= rk on what has become the world's biggest web-based transaction system.=20 Enron was so secure in its standing that it was building a new 40-storey of= fice building adjoining its 50-storey tower.=20 Beside that bulldozers and cranes have been putting the finishing touches = to a massive new parking garage.=20 Employees had just started to move into the new towers when a series of dis= closures about Enron's financial position began to undermine the company an= d send investors fleeing for cover.=20 Enron staff once known for being both brilliant and arrogant enough to pro= ve it are coping with their dramatic reversal in status in a wide variety = of ways.=20 As they left work yesterday many brushed by in their smart-casual polo shi= rts and khakis refusing to say a word about what was unfolding.=20 One man looking exhausted braved a grin and said: Just keep smiling. The= world goes on. Companies go through problems all the time just like we do= in personal life.=20 One woman felt she had to laugh at the irony: she moved to Enron last year = to protect herself from job losses in the more traditional energy businesse= s. At that time Enron was considered the safest place to be in the industr= y.=20 That Dynegy another Houston-based energy trader has emerged as Enron's sa= viour is being received positively by staff who praised its technology and= processes.=20 The Houston business community may be hoping that a merged group might be b= etter for the city than a stand-alone Enron as a combined business would b= e bigger and stronger.=20 But John Olson of Sanders Morris Harris a local investment banking and se= curities firm in Houston notes that a merger is likely to lead to job loss= es as assets are sold and businesses are streamlined.=20 Already he says many Houston citizens big holders of Enron's stock had = lost out on its share slide. The ripple effects on the city will be immeas= urable he says.=20 (c) Copyright Financial Times Ltd. All rights reserved.=20 http://www.ft.com. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 NEWS Dynegy to acquire Enron in $8.9 billion stock deal / New giant moves out of= shadow LAURA GOLDBERG Staff 11/10/2001 Houston Chronicle 3 STAR 1 (Copyright 2001) Enron Corp. a mainstay of Houston's corporate landscape that helped turn t= he city into a global energy trading powerhouse will disappear in a turn o= f events that would have been unthinkable a month ago.=20 In a deal that will unite two hometown rivals Dynegy announced Friday even= ing it would buy the beaten-down Enron in a stock deal worth almost $8.9 bi= llion plus the assumption of $12.8 billion in debt. The purchase will end Enron's reign as the world's largest energy trader c= atapulting a company to the top that in many ways has been in Enron's shado= w.=20 This could be viewed as Dynegy being the savior of industry in rescuing En= ron the largest energy trader and restoring market liquidity said Carol= Coale a stock analyst with Prudential Securities in Houston who follows = both companies.=20 A much bigger Dynegy - with annual revenues exceeding $200 billion and $90 = billion in assets including pipelines and power plants - will emerge with C= huck Watson its current chairman and chief executive keeping those roles = in the combined company.=20 Layoffs are expected but executives said it was too early to say how many.= Dynegy has almost 1600 employees in Houston Enron has more than 7000 he= re.=20 For Watson the deal is all about growth.=20 It accelerates our strategy some three or four years he said shortly aft= er the deal was announced. This is just a financial bonanza really for bot= h companies.=20 This isn't the way Ken Lay Enron's chairman and chief executive ever thou= ght his years of work would turn out.=20 This would not have been my dream case Lay said in an interview with the= Chronicle shortly after the deal was announced. I would not even have con= templated it three or four weeks ago.=20 Lay has been offered a seat on the combined company's board but hasn't dec= ided yet whether to take it. He won't have any management role once the dea= l closes.=20 He helped take Enron from a staid pipeline company created from a 1985 merg= er to a trading machine that wheels and deals in gas electricity financia= l contracts used to help companies manage risk and other commodities.=20 But Lay said he believed selling Enron was the best option for its sharehol= ders employees and the city considering the company's current battered sta= te.=20 This is the best way to provide certainty to protect this wholesale market= ing and trading franchise which is so valuable he said adding that Enron= looked at two or three other alternatives as it tried to strengthen its ba= lance sheet and add cash into its operations.=20 Lay said it's not his preference to sell Enron and see its name disappear.= =20 It happens to be the best alternative said Lay. I'm a realist. I knew w= hat needed to be done.=20 Among Enron's troubles: The Securities and Exchange Commission is investiga= ting business deals Enron did with two investment partnerships run by its f= ormer chief financial officer its credibility on Wall Street is close to z= ero a pile of shareholder lawsuits and its credit rating which it relies = on to successfully run its core trading business has been lowered.=20 While other questions had hung over Enron earlier this year the path to it= s end really began Oct. 16 when the company released third- quarter earnin= gs and reported significant financial losses related to the two investment = partnerships.=20 That set in motion a spiral of events leading to Friday's announcement.=20 Watson called Lay on Oct. 24 to see if he could do anything to help dispel = rumors that Dynegy had stopped trading with Enron.=20 That conversation led to a meeting at Lay's house three days later at whic= h the two started talking about a deal.=20 As these things go the deal came together quickly especially with so many= question marks hanging over Enron.=20 I think it's important to understand that Ken and I have known each other = for some 20 years Watson said. We have a good understanding of what they= do and how they do it. We knew that their franchise was solid.=20 Under the terms of the deal which is expected to close in six to nine mont= hs:=20 Enron shareholder's get 0.2685 share of Dynegy per Enron share. Based on Fr= iday's closing stock prices of $8.63 for Enron and $38.76 for Dynegy Dyneg= y is paying $10.41 an Enron share - or a 21 percent premium. That's a far c= ry from late January when Enron's closing price hit $82 a share.=20 Dynegy will immediately inject $1.5 billion in Enron to help shore it up. D= ynegy will get that money from ChevronTexaco which owns about 26 percent o= f Dynegy.=20 In return for that money Dynegy will get preferred stock and other rights = in Enron's Northern Natural Gas pipeline system. Should the deal not close= Dynegy has the right to buy all of Northern Natural Gas.=20 At the deal's closing ChevronTexaco will provide another $1 billion to the= combined company.=20 Enron will have the right to designate at least three board members for the= combined company which will have 14 board seats.=20 Steve Bergstrom Dynegy's president and Rob Doty Dynegy's chief financial= officer will keep those roles in the new company. Greg Whalley currently= president and chief operating officer of Enron will become an executive v= ice president at the combined company.=20 The deal contains a $350 million breakup fee that Dynegy would get if anoth= er suitor came in and Enron decided to take a better offer.=20 Watson also said the deal contains escape clauses to protect Dynegy should = it be necessary but he doesn't expect any surprises.=20 We looked under the hood and guess what it's just as strong as we thought= it was he said.=20 The deal must be reviewed by a variety of government regulators though Wat= son isn't expecting any antitrust problems.=20 Dynegy will talk to analysts and investors on a conference call Monday att= empting to convince them of the deal's value. Dynegy expects the merger to = result in $400 million to $500 million in annual savings.=20 On paper it looks good said Coale the analyst. We still remain concer= ned about the uncertainties that shroud Enron . . . The risks continue to b= e what we don't know about Enron. We just hope Chuck and his team do all th= e necessary due diligence which is going to take more than a couple weeks.= =20 There are also concerns about merging two different cultures.=20 Looking at cultures the two companies are very different she said. Dyn= egy is a little bit of a fraternity. Chuck started this company and I'm sur= e he has a heartfelt emotion toward making things work at Dynegy. Enron is = a mercenary aggressive cutthroat culture.=20 While both are energy traders Enron has pursued a strategy of shedding ass= ets while Dynegy has continued to make asset purchases.=20 At the start of the year Enron was still heralded as an innovator for othe= rs to emulate. Since a series of problems began chipping away at Enron's i= mage.=20 But such concerns were mostly pushed aside for as long as the company's sto= ck price performed well and its core energy trading business turned out hig= her and still-higher profits.=20 The company's woes became more serious and quickly multiplied after it made= troubling financial disclosures in its third-quarter earnings report Oct. = 16.=20 It disclosed that day it had taken a $35 million loss and reduced sharehold= ers equity by $1.2 billion related to ending business dealings with two inv= estment partnerships formerly run by Andrew Fastow its chief financial off= icer.=20 The disclosures heightened Wall Street's ongoing concerns that Enron's fina= ncial reporting was too difficult to understand and skimped on details. It = also led to fears that Enron would be on the hook for billions of dollars r= elated to other financial vehicles.=20 Days later Enron revealed that the SEC was investigating transactions betw= een Enron and the partnerships called LJM Cayman and LJM2 Co-investment. I= t also replaced Fastow and has been hit with a growing number of shareholde= r lawsuits.=20 Then the company's credit rating was downgraded which raised questions ab= out its ability to manage its core energy trading business.=20 As Wall Street's questions grew Enron retreated into silence leaving anal= ysts and investors to speculate on worst-case scenarios which fed fears th= at company was facing a cash-crunch and caused investors to keep dumping th= e stock.=20 That in turn led some of Enron's trading partners to shift business elsewh= ere and raise their credit requirements to do business with Enron which in= turn raised even more fears.=20 Thursday Enron said it is restating its finances as far back as 1997 to in= clude losses related to a number of complex partnerships it created.=20 . . .=20 DEAL AT-A-GLANCE=20 Company name: Dynegy.=20 Key players: Chuck Watson Dynegy's current chairman and CEO will remain c= hairman and CEO. Enron Corp.'s CEO and Chairman Ken Lay has been offered a = seat on Dynegy's board.=20 The trade: 0.2685 share of Dynegy for each share of Enron Corp.=20 Value of the deal: $8.85 billion in stock and $12.8 billion in Enron debt.= =20 Dynegy's close Friday: $38.76=20 Enron's close Friday: $8.63 a share.=20 Status of Enron Field name: Unknown. However Dynegy registered the name ww= w.dynegyfield.com on Thursday.=20 . . .=20 MORE STORIES=20 Enron Corp. paid $100 million to put its name on the Houston Astros' new do= wntown home. Now that the energy giant is being bought the name may soon b= e history.=20 The sale of Enron Corp. will likely punish Houston's downtown office market= emptying more office space at a time when several new buildings are going= up.=20 Never make predictions especially about the future Ken Lay once wrote i= n an essay concerning the world's energy needs. Enron's chief executive mig= ht be taking those words to heart today.=20 Dynegy's Chuck Watson has always maintained a low profile prompting some p= eople to label him as the most influential Houstonian you've never heard of= .=20 See these stories and more in Business.=20 . . .=20 The companies=20 Profiles of two Houston energy giants that announced their merger Friday:= =20 DYNEGY=20 Headquarters: Houston=20 Chairman and CEO: Chuck Watson=20 Revenues in 2000: $29.4 billion=20 Employees: 6000 worldwide=20 Electricity sales (2000): 137.7 million megawatt hours=20 Gas sales (2000): 10.9 billion cubic feet per day=20 Business segments: Dynegy Marketing and Trade Dynegy Midstream Services I= llinois Power Subsidiary Dynegy Global Communications=20 History: The company traces its roots to 1984 when the investment banking f= irm Morgan Stanley the law firm Akin Gump Strauss Hauer & Feld and six n= atural gas pipelines teamed up to create a natural gas marketing firm calle= d U.S. Natural Gas Clearinghouse Ltd. Chuck Watson joined the company in 19= 85 and the operation was revamped the pipeline partners bought out and th= e name shortened to Natural gas Clearinghouse. In 1995 the company purchas= ed Trident NGL Holdings quadrupling its liquids business. The company went= public for the first time under the new name NGC Corp. that same year. In = 1996 NGC merged with Chevron's gas and gas liquids business. The firm purc= hased its first power plants with the acquisition of Destec in 1997 and cha= nged its name to Dynegy in 1998 to reflect expansion beyond natural gas. Th= e company has continued to grow through acquisitions.=20 . . .=20 ENRON=20 Headquarters: Houston=20 Chairman and CEO: Ken Lay=20 Revenues in 2000: $100.8 billion=20 Employees: 20000 worldwide=20 Electricity sales (2000): 590.2 million megawatt hours=20 Gas sales (2000): 28.3 billion cubic feet per day=20 Core areas: Enron Wholesale Services Enron Energy Services Enron Transpor= tation Services=20 History: The company was formed in 1985 as a result of the merger of Housto= n Natural Gas and InterNorth a natural gas company based in Omaha Neb. Th= e deal integrated several pipeline systems to create the first nationwide n= atural gas pipeline system. In 1986 Ken Lay CEO of Houston Natural gas w= as named chairman and CEO and the name Enron was chosen. In 1989 Enron = began trading natural gas commodities through its GasBank a precursor to t= oday's wholesale trading business. Enron made its first electricity trade i= n 1994 and eventually became the world's biggest marketer of electricity an= d gas. Photo: 1. Ken Lay chairman and CEO of Enron Corp. listens at a Friday new= s conference as Chuck Watson chairman and CEO of Dynegy discusses his com= pany's acquisition of Enron (color) Graphs: 2. Deal At-A-Glance (b/w text= ) 3. More Stores (b/w text) 4. The companies (b/w p. 16 text)=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 BUSINESS POWER PLAY / Lay opened energy firms to work in new markets MICHAEL DAVIS Staff 11/10/2001 Houston Chronicle 3 STAR 3 (Copyright 2001) THE famous baseball manager Casey Stengel was smart to advise Never make = predictions especially about the future Ken Lay once wrote in an essay o= n world energy needs.=20 Lay might be taking those words to heart today. As the chairman of Enron Corp. predicted not long ago We can see some ver= y significant growth with several years to come.=20 Once considered one of the shining stars of the energy business Lay has wa= tched the company he helped create melt down around him in a matter of week= s.=20 And as of Friday he was left to ponder an offer to serve as a member of th= e board for the new company formed from Enron and its chief rival - no long= er a chairman or a chief executive.=20 Perhaps that's the way he wants it.=20 When he turned over the chief executive's post at Enron to Jeffrey Skilling= earlier this year it seemed like the first move of his orderly exit from = the company he had helped create in the mid-1980s.=20 Eleven months later Skilling is gone and Lay has had to preside over the d= eath of Enron.=20 What had begun as a stodgy natural gas pipeline company had been molded and= expanded by the two men into a diversified financial giant with its hands = in countless markets from oil and natural gas to water and broadband.=20 It seemed Lay 58 who is an economist by profession had also cemented his= reputation as an elder statesman in the energy industry the man who had o= pened the business world's eyes to the array of possibilities that energy c= ompanies could explore for growth away from their traditional roles.=20 With the implosion of Enron in the past month Lay's legacy now seems tarni= shed. The man who was once referred to as an energetic messiah has been f= orced to sell off his creation in a fire sale to rival Dynegy in a hastily = arranged deal. Lay's approach is reflected in the design of the building En= ron is constructing across from its existing tower on Smith Street. Looking= down on the massive trading floor are two offices built for Lay and Skilli= ng.=20 The offices were considered symbolic of the company's openness and its phil= osophy of melding executives with the rank and file. Lay reportedly spurned= the express elevator to ride to his 50th-floor office to spend more time w= ith employees.=20 That sort of hands-on approach Lay brought to the company may be another ca= sualty analysts said.=20 I would be surprised if he had much of a role in running things from a day= -to-day perspective said Brian Youngberg energy analyst with Edward Jone= s in St. Louis. I think Dynegy will be running the ship and plug in some E= nron executives.=20 As the dust settles on Enron the question is being raised as to whether th= e company became too big for one or two men to run in a hands-on fashion.= =20 Ken Lay helped build Enron from being just a pipeline company but over ti= me the company got so big and complex that it was too hard for one or two s= enior executives to completely oversee things and to know fully what was go= ing on in the operating companies Youngberg said.=20 Raised on a farm in Missouri Lay is well-known not just as chairman of Enr= on but as a former undersecretary of the Interior Department and one of the= people who has helped shape Houston's destiny in the past 20 years. He is = considered instrumental in keeping Major League Baseball in Houston by supp= orting the construction of Enron Field.=20 But his lasting legacy will likely be as one of the key people who helped c= reate the huge natural gas futures market in the United States which was n= onexistent as recently as the late 1980s. He also will be remembered as the= man who led others to view the energy business as one integrated market an= d not individual fiefdoms.=20 Ken Lay really did educate his peers to understand the broadness of his bu= siness said Amy Jaffe a senior energy analyst with Rice University's Jam= es A. Baker III Institute for Public Policy. Whether his retirement is und= er positive or negative circumstances he has left a huge legacy on the ind= ustry.=20 Jaffe sees Lay as the person who got oil and gas executives to break out of= the old mentality and explore new technologies such as fuel cells and wind= power. He also was a leading proponent of natural gas and power deregulati= on.=20 He will leave Enron a wealthy man although much less so since the company'= s stock nose-dived. His current contract pays him a base salary of $1.4 mil= lion a year and a bonus of $7 million. It was due to expire in December 200= 3.=20 This is not the first time Lay has had to rescue Enron. In 1987 Enron was = rocked by the disclosure that rogue traders at its Enron Oil Co. had left t= he company holding the bag for about $1 billion in trading liabilities. Bef= ore disclosing it to the market the company worked the trading loss down t= o about $142 million.=20 We learned a lot certainly in a bad way Lay said of the incident in an = interview earlier this year. We put in place probably the best risk manage= ment and control system not just in our business but in any industry.=20 Some see irony in the fact that Dynegy CEO Chuck Watson will likely prevail= over Lay despite Lay's almost cult status among business leaders and busin= ess school professors.=20 Chuck Watson was underrated in his role in forming the natural gas market = in the United States. He was the man who realized the enormous potential of= the natural gas market Jaffe said. It's true that Enron came in with a = lot of advertising and built up a big position but maybe there is some poe= tic justice that the man who really started the natural gas clearinghouse c= ould wind back up as the dominant player in the industry.=20 ...=20 THE PLAYERS=20 1985-present: Enron Corp. various top management posts currently chairman= and CEO 1984-1985: Houston Natural Gas Corp. chairman and CEO 1981-1984 T= ransco Energy Co. president and chief operating officer Board memberships:= Compaq Computer Corp. Eli Lilly & Co. and Trust Company of the West Educa= tion: University of Missouri master's degree economics 1965: doctorate = economics Membership: Energy Advisory Board secretary National Petroleum = Council member Photo: Ken Lay=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 BUSINESS POWER PLAY / Purchase elevates Watson's low profile GREG HASSELL Staff 11/10/2001 Houston Chronicle 2 STAR 3 (Copyright 2001) AS the chairman of a company that employs 6700 workers and rakes in annual= revenues of $29.4 billion Chuck Watson is hardly an anonymous executive i= n Houston.=20 But the head of Dynegy Inc. has always maintained a low profile prompting = some people to label him as the most influential Houstonian you've never he= ard of. He steers clear of the political arena and the limelight of the cit= y's big social soirees. He doesn't live in River Oaks but lives in the sam= e neighborhood near Champion's Forest where he's lived for years. When they donated $1 million worth of land for the relocation of his church= Windwood Presbyterian Watson and his wife Kim tried to donate anonymou= sly.=20 We talked about that a lot and they reluctantly agreed that it wouldn't t= ake a rocket scientist to figure out who in this congregation would be able= to do something like that Senior Pastor Kevin Rudolph said.=20 When fellow church member Merle Davidson recently offered to let Watson dri= ve a luxurious new Bentley for a weekend Watson readily agreed.=20 He enjoyed the car said Davidson general manager of Post Oak Motor Cars= . But when I asked him `Should I order you one?' he shook his head.=20 I don't know if I could drive such a high-profile car Watson said.=20 It's not that Watson objects to a fancy ride he drives a top-of- the-line = Mercedes. But he's not a showboat and isn't comfortable attracting attentio= n to himself.=20 He doesn't act like a big shot said Tilman Fertitta the chairman of Lan= dry's Restaurants who likes driving a Bentley and zipping around in a heli= copter. Chuck's not all caught up in the Houston hustle-and-bustle thing.= =20 Like it or not Watson is about to step out in a big way. If Dynegy complet= es the acquisition of Enron for $8.85 billion in stock Watson will become = captain of Houston's largest company. He will step right into the center of= the city's business stage taking from Enron Chairman Ken Lay the mantle o= f most powerful businessman in a city where commerce and the deal have alwa= ys come first.=20 Those who know Watson say he should have little trouble adapting to his hig= her profile and is ready for the many demands that will inexorably follow.= =20 Chuck is a guy who knows what he wants and goes and gets it Fertitta sai= d. He is not intimidated.=20 In fact when longtime friend Steve Patterson read about Enron's nose-dive = and the collapse of its stock he instinctively knew Watson would close in = on a deal.=20 I thought: `You know what Chuck will try to buy Enron. It just fits. It's= the big bold move that Chuck would try to make' said Patterson senior = vice president of the Houston Texans football team. Watson owns 15 percent = of the Texans the largest chunk outside of the piece owned by club founder= Bob McNair. Watson also owns the Houston Aeros hockey team.=20 Like Enron Chairman Ken Lay Watson was a pioneer in the deregulation of th= e energy business. He was one of the early innovative forces that shaped th= e world of trading electricity and swapping natural gas.=20 Watson was born 51 years ago on the Great Lakes naval base north of Chicago= . His father worked for the Navy which moved the young Watson clan around = early and often. Chuck Watson had attended more than 20 schools in nine sta= tes when he graduated from Oklahoma State University in 1972 with a degree = in economics.=20 After a 13-year career at Conoco Watson joined a fledgling company called = U.S. Natural Gas Clearinghouse in 1985. NGC was a consortium of gas pipelin= es that had the backing of a financial- services company and a local law fi= rm but conflicts among the partners hamstrung the little company.=20 Watson would not join the company until it was overhauled and most of the q= uarreling partners were bought out. Watson's vision was to buy the gas and = take title to it aggregate big volumes and leverage that to make bigger de= als and negotiate better rates from the pipelines that moved the gas around= .=20 In short the company moved beyond being a broker and became a wholesale st= ore for natural gas.=20 He is a visionary in the energy business said Bob McNair a longtime fri= end who founded Cogen Technologies and later sold the company to Enron for = $1.1 billion. Chuck will come across as this relaxed country person. Not = some sophisticate. But that is disarming. He is very creative and he is ve= ry smart.=20 While NGC initially concentrated on gathering moving and trading natural g= as the business has broadened along with the quickening pace of energy der= egulation. Now called Dynegy short for Dynamic Energy the company has evo= lved into an outfit that sells power directly to commercial and industrial = users of electricity and natural gas. It also has built a communications di= vision to capitalize on increasing demand for high-speed communication serv= ices.=20 Last year the company recorded an astounding 230 percent rise in net income= as well as a 91 percent jump in operating revenues. Dynegy's stock climbe= d 218 percent last year.=20 The success of Dynegy is a tremendous story Patterson said. It is amazi= ng the growth and the value he has been able to achieve.=20 According to some of those who've have done business with him Watson is no= t just bright he is extraordinarily tough.=20 He is a very aggressive person a tough negotiator. He bores in said Geo= rge Mitchell founder of Mitchell Energy and the man who carved The Woodlan= ds out of the piney forest.He is a very confident person. Unlike Ken Lay = who is a smoother type personality who works with people Watson is going t= o do it his way. They are both very good business people but they are very= different.=20 While willing to give power to his subordinates Watson is a hands- on CEO = who is unmistakably Dynegy's commanding force.=20 Chuck is very very intense . . . He burns said former Houston Mayor Bob= Lanier. In negotiations he gets down and learns all the details himself.= =20 How tough Watson is willing to be came to light in his contentious dealings= with Houston Rockets owner Les Alexander. Watson owned the master lease to= the Summit later renamed the Compaq Center which committed the Rockets t= o playing there through 2003. Eager to break the deal Alexander tried nego= tiating and litigating his way out of the lease all to no avail.=20 The battle deepened as the two men competed unsuccessfully to get a NHL hoc= key team in Houston and feuded over how a hockey team would share in the re= venues of a new stadium proposed for downtown.=20 Angered at the deal Alexander was able to get for the Rockets at the expen= se of a hockey franchise Watson spent about $100000 out of his own pocket= to help defeat the stadium referendum. It was his one overtly political ac= t here and some say it was the decisive blow to Alexander's aspirations.= =20 There are a lot of people I'd much rather have a contest with Lanier sai= d of Watson.=20 Alexander and Watson were later able to settle their differences and Watso= n supported the second arena referendum which passed. A basketball arena i= s now under construction downtown.=20 I'm not surprised to see Chuck Watson make an aggressive move like this = Alexander said Friday evening. He understands the industry as well as anyo= ne and therefore he's in the best position to assess the risk and take ad= vantage of the opportunity.=20 Like most opportunities the deal also represents a sizable risk. Taking ov= er Enron is a huge reach for Dynegy which will try to swallow a company th= at was five times bigger when measured by revenues.=20 Watson will need all of his shrewdness and ferocity to untangle the mess th= at is Enron and merge two operations that were each in their own way tryi= ng to reinvent the energy business.=20 I have some concerns for my friend McNair confessed. It is a tremendous= challenge. I know he'll handle it well but this will be a very demanding = business.=20 ...=20 The Players=20 1989-present: Dynegy chairman and CEO=20 1985: NGC Dynegy's predecessor president=20 1972-1985: Conoco various positions=20 Other: Board member Baker Hughes Vice Chairman Houston Texans=20 Education: Oklahoma State University business and economics=20 Membership: National Petroleum Council Interstate Natural Gas Association = of America board member Edison Electric Institute board member Natural Ga= s Council founding member Photo: Chuck Watson=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 NEWS Dyenegy to acquire Enron in $8.9 billion stock deal / Many fear `unique' pr= oblems L.M. SIXEL Staff 11/10/2001 Houston Chronicle 3 STAR 1 (Copyright 2001) People who worked for Enron Corp. walked with a special swagger they knew = they were a part of something special something unique one employee said = Friday.=20 But today it seems as if that something special has evaporated. As rumors and news about the Dynegy buyout leaked out Friday many of those= who gathered around the base of the Enron Tower to smoke were worried abou= t their fate.=20 Several worried about their job prospects during a time when the economy ap= pears to be sinking into a recession and job losses are mounting across the= nation.=20 Others were concerned that Enron is such an innovator and their jobs so uni= que that they'll have a hard time finding an equivalent job somewhere else.= =20 Many were angry that company officials had made the financial missteps that= got the company into its precarious situation.=20 And others were just unnerved by the uncertainty.=20 See you Monday hopefully bro shouted one Enron employee to another acro= ss its tree-lined plaza.=20 Once the buyout was announced late Friday afternoon and it became clear lay= offs would be coming one employee seemed to feel a bit better.=20 It's a relief to know what's going on she said asking not to be identif= ied. And like many the employee who works on Enron's trading floor was no= t just thinking of her job. Like so many others her retirement account was= mostly invested in Enron stock.=20 The employee who asked not to be identified said she figured her retireme= nt account lost about $100000 in value over the past few weeks as Enron s= tock plummeted in value.=20 She even encouraged her college-age children to invest their college funds = in Enron stock. It's all gone now she said and that was money they'd need= in the next two years.=20 Jamie Lynn a 29-year-old coordinator of gas logistics figured that he los= t close to $400000 in stock options. But others employees lost millions h= e said.=20 It makes me sick to my stomach Lynn said.=20 While the money losses hurt he is also feeling badly because he loved his = job - and company - so much.=20 People walked around downtown with a swagger he said. They were proud t= o say they worked at Enron.=20 Lynn can't imagine finding another company with such an exciting culture an= d with such exciting challenges.=20 I don't want this company to be owned by someone else he said.=20 But if it had to be sold he was hoping Shell Oil Co. would be the buyer. S= hell isn't in any of the same lines of business as Enron and they'd have to= depend on Enron employees to keep the place running.=20 While Lynn is lucky because he is already being recruited by other companie= s other employees were not as upbeat about their opportunities. Several in= formation technology employees such as programmers and software designers w= ere especially worried.=20 The general market for information technology isn't very good right now and= they worried whether Dynegy would need their services.=20 Maybe I'll have to pack up and go back home said a software developer fr= om India who is working at Enron on a visa.=20 A programmer discussed her prospects while she waited for a bus. She's prep= aring for a layoff and luckily has been savingmoney to tide her over in ca= se she lost her job.=20 Other information technology professionals were more upbeat.=20 A systems integrator said he has no doubts that he'll be picked up by Dyneg= y because it needs to know how to run Enron's complicated computer systems.= Besides he said he has been recruited by Dynegy several times and said h= e was in a good position to cash in on connections.=20 Others were not as optimistic. Tears filled one employee's eyes as she wait= ed for a ride. Others were too upset to comment. Part of that stemmed from = the feeling that senior executives ran the company arrogantly and for their= own self-interests.=20 When the deal was announced employees began to turn their minds to more im= mediate details such as severance packages.=20 In the past Enron has been generous an employee said.=20 Let's hope that tradition continues she added.=20 . . .=20 DEAL AT-A-GLANCE=20 Company name: Dynegy.=20 Key players: Chuck Watson Dynegy's current chairman and CEO will remain c= hairman and CEO. Enron Corp.'s CEO and Chairman Ken Lay has been offered a = seat on Dynegy's board.=20 The trade: 0.2685 share of Dynegy for each share of Enron Corp.=20 Value of the deal: $8.85 billion in stock and $12.8 billion in Enron debt.= =20 Dynegy's close Friday: $38.76=20 Enron's close Friday: $8.63 a share.=20 Status of Enron Field name: Unknown. However Dynegy registered the name ww= w.dynegyfield.com on Thursday.=20 . . .=20 MORE STORIES=20 Enron Corp. paid $100 million to put its name on the Houston Astros' new do= wntown home. Now that the energy giant is being bought the name may soon b= e history.=20 The sale of Enron Corp. will likely punish Houston's downtown office market= emptying more office space at a time when several new buildings are going= up.=20 Never make predictions especially about the future Ken Lay once wrote i= n an essay concerning the world's energy needs. Enron's chief executive mig= ht be taking those words to heart today.=20 Dynegy's Chuck Watson has always maintained a low profile prompting some p= eople to label him as the most influential Houstonian you've never heard of= .=20 See these stories and more in Business.=20 . . .=20 The companies=20 Profiles of two Houston energy giants that announced their merger Friday:= =20 DYNEGY=20 Headquarters: Houston=20 Chairman and CEO: Chuck Watson=20 Revenues in 2000: $29.4 billion=20 Employees: 6000 worldwide=20 Electricity sales (2000): 137.7 million megawatt hours=20 Gas sales (2000): 10.9 billion cubic feet per day=20 Business segments: Dynegy Marketing and Trade Dynegy Midstream Services I= llinois Power Subsidiary Dynegy Global Communications=20 History: The company traces its roots to 1984 when the investment banking f= irm Morgan Stanley the law firm Akin Gump Strauss Hauer & Feld and six n= atural gas pipelines teamed up to create a natural gas marketing firm calle= d U.S. Natural Gas Clearinghouse Ltd. Chuck Watson joined the company in 19= 85 and the operation was revamped the pipeline partners bought out and th= e name shortened to Natural gas Clearinghouse. In 1995 the company purchas= ed Trident NGL Holdings quadrupling its liquids business. The company went= public for the first time under the new name NGC Corp. that same year. In = 1996 NGC merged with Chevron's gas and gas liquids business. The firm purc= hased its first power plants with the acquisition of Destec in 1997 and cha= nged its name to Dynegy in 1998 to reflect expansion beyond natural gas. Th= e company has continued to grow through acquisitions.=20 . . .=20 ENRON=20 Headquarters: Houston=20 Chairman and CEO: Ken Lay=20 Revenues in 2000: $100.8 billion=20 Employees: 20000 worldwide=20 Electricity sales (2000): 590.2 million megawatt hours=20 Gas sales (2000): 28.3 billion cubic feet per day=20 Core areas: Enron Wholesale Services Enron Energy Services Enron Transpor= tation Services=20 History: The company was formed in 1985 as a result of the merger of Housto= n Natural Gas and InterNorth a natural gas company based in Omaha Neb. Th= e deal integrated several pipeline systems to create the first nationwide n= atural gas pipeline system. In 1986 Ken Lay CEO of Houston Natural gas w= as named chairman and CEO and the name Enron was chosen. In 1989 Enron = began trading natural gas commodities through its GasBank a precursor to t= oday's wholesale trading business. Enron made its first electricity trade i= n 1994 and eventually became the world's biggest marketer of electricity an= d gas. Photo: Photo: 1. Ken Lay chairman and CEO of Enron Corp. listens at a Fri= day news conference as Chuck Watson chairman and CEO of Dynegy discusses = his company's acquisition of Enron (color) Graphs: 2. Deal At-A-Glance (b/= w text) 3. More Stores (b/w text) 4. The companies (b/w p. 16 text)= =20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Financial Desk The Nation Smaller Rival to Acquire Teetering Enron Power: Energy giant tha= t pressed for deregulation in California is on the brink of collapse. NANCY RIVERA BROOKS THOMAS S. MULLIGAN NANCY VOGEL TIMES STAFF WRITERS 11/10/2001 Los Angeles Times Home Edition A-1 Copyright 2001 / The Times Mirror Company Enron Corp. the once-highflying energy giant whose aggressive efforts to p= rofit from California's energy deregulation made it a target of consumer an= d political backlash on Friday agreed to be saved from possible financial = collapse through a proposed acquisition by rival Dynegy Inc.=20 The roughly $7.7-billion deal is a stunning plot twist for Houston-based En= ron which was vilified in California as it was being glorified on Wall Str= eet. In only the last month a series of disturbing financial revelations p= ushed to the edge of ruin this once-powerful company whose top executives = had lectured California on its energy foibles and who influenced the direct= ion of national energy policy. Enron muscled its way to the top of the energy heap using aggressive and i= n the end financially suspect strategies that proved its undoing.=20 Now the company that late last year had a market value of $63 billion is w= orth one-tenth that and has agreed to be swallowed by a cross-town competit= or one-quarter its size. Enron's proud and influential chairman and chief e= xecutive Kenneth L. Lay who became a focus of bitter attacks by Californi= a politicians and regulators would lose his job as would many others at E= nron.=20 Even the name would disappear. The combined company would be called Dynegy = Inc. if the deal receives all the necessary regulatory and shareholder appr= ovals.=20 California officials took no joy in Enron's fate Friday though there was p= erhaps some sense of retribution from its many critics in the state.=20 This is basically a rogue corporation said Sen. Steve Peace (D-El Cajon)= an outspoken critic of Enron for years who dealt with the company as he c= haired the committee that hammered out the legislative portion of Californi= a's landmark electricity deregulation plan in 1996. It has from the beginn= ing been a rogue corporation which answered in its mind to a higher law--a = fundamental belief that there are laws of economics that supersede the law = of the land.=20 A Failed Experiment=20 Steve Maviglio spokesman for Gov. Gray Davis said that although Enron was= never a major force in California's doomed electricity market it was outs= poken in support of deregulation.=20 In a sense their experiment was much like California's experiment--a fail= ure he said.=20 Said Harvey Rosenfield president of the Foundation for Taxpayer and Consum= er Rights in Santa Monica: Nothing could better illustrate the disaster of= deregulation than the fact that one of its biggest proponents which reape= d the reward of deregulation is suffering the consequences.=20 Enron is the world's largest energy trader handling one of four energy dea= ls in the United States through its online trading operation EnronOnline. = Since it reported a surprising third-quarter loss on Oct. 16 partly tied t= o shadowy investment vehicles Enron has endured a huge loss of investor co= nfidence which brought on a massive cash crunch and some shrinkage of its = trading business.=20 Under the deal announced Friday Dynegy invited in two weeks ago after Enr= on fell short in its efforts to line up new financing would immediately he= lp Enron by pouring $1.5 billion in cash into the company. The money would = be provided by ChevronTexaco Corp. the San Francisco oil company that owns= nearly 27% of Dynegy.=20 Enron shareholders would get 0.2685 Dynegy share for each Enron share whic= h values the company at about $7.7 billion based on Friday's stock close. D= ynegy shares surged $2.26 to close at $38.76 per share on the New York Stoc= k Exchange Enron added 22 cents to close at $8.63 per share still off 89%= year to date.=20 If the deal closes in six to nine months as the parties expect Dynegy and= ChevronTexaco would invest $1 billion additionally in the combined company= .=20 This is just a financial bonanza really for both companies said Charles = L. Watson Dynegy chairman and chief executive who will head the combined = company. Watson said the merger would immediately add to Dynegy's earnings.= =20 Even so the repercussions of Enron's fall from grace could be far-reaching= . Coming on the heels of California's energy crisis Enron's troubles may s= low the country's march toward energy deregulation which Lay and Enron cha= mpioned for years as a potential boon to consumers and the economy in gener= al.=20 But the deal announced Friday will prevent an even worse outcome energy ex= perts said: the threatened collapse of Enron which would clog up for a tim= e the business of buying and selling electricity natural gas and oil. That= could interfere with delivery of energy around the country they said.=20 This is an encouraging development for the energy industry said Stephen = Baum chairman of Sempra Energy the San Diego-based parent of Southern Cal= ifornia Gas and San Diego Gas & Electric. The Enron-Dynegy combination wil= l create a credit-worthy counter-party which will help preserve order in th= e marketplace. It also will reinforce confidence in the energy trading busi= ness going forward.=20 But some in the industry are less pleased.=20 Raymond Plank chairman of Apache Corp. a Houston-based natural gas explor= ation and development firm said he is considering a motion to the Federal = Trade Commission against the proposed merger.=20 There are issues of concentration in a combination of the largest energy t= rader Enron and the fifth-largest Dynegy Plank said. California shoul= d be particularly concerned because Dynegy owns power plants there and Enro= n has pipelines and other interests.=20 Troubles Mount as Stock Plunges=20 The swagger that was Enron is long gone. Consider:=20 * Enron's brash chief executive Jeffrey K. Skilling touted only months ag= o as one of the young stars of American business abruptly resigned in Augu= st citing personal reasons. Enron's stock already had fallen from its high= of nearly $90 per share as investments in water and telecommunications tur= ned sour a fact that contributed to Skilling's departure.=20 * The Securities and Exchange Commission has launched an investigation of E= nron's controversial dealings with a number of limited partnerships some o= rganized and run by Enron managers including Enron Chief Financial Officer= Andrew S. Fastow who was ousted last month.=20 * In an extraordinary confession Thursday Enron announced that it had over= stated profit by $586 million or 20% during the last five years. The earl= ier financial statements reported to Wall Street and the investing public = Enron said should not be relied upon.=20 * The company also fired its treasurer and a corporate lawyer both of whom= it said were investors in one of the limited partnerships. Yet some analys= ts questioned whether even in its admission of accounting trickery Enron = wasn't still holding something back.=20 * Credit-rating agencies which already have downgraded Enron's bonds to ba= rely above junk status continue to pore over Enron's books. Analysts hav= e said a further downgrade to the level of junk or below investment grade= could precipitate a crisis akin to a run on a bank and threaten Enron's su= rvival while the merger is pending.=20 With its stock crumbling and trading partners leery about its ability to pa= y its debts Enron was forced to walk hat in hand down Houston's Energy All= ey to negotiate a saving takeover by Dynegy the rival once jokingly dismis= sed as Enron Lite.=20 In the trading markets where Enron still holds a leading but increasingly v= ulnerable position other players already are stepping up to grab a bigger = share of the business. Even if Enron's trading operation survives more or l= ess intact under the wing of a Dynegy or some other company experts said = it may never regain its former level of dominance.=20 Enron has been a very innovative shop willing to spend considerably to es= tablish new markets said analyst Andre Meade of Commerzbank Securities in= New York. If that culture is not kept everyone loses.=20 Skilling and mentor Lay had worked for a decade to create both a new kind o= f company and a new set of markets for it to play.=20 In large part they succeeded. Enron transformed itself from a traditional = gas pipeline company into a high-tech global trader of everything from elec= tricity to pollution credits to aluminum. The company's overarching strateg= y was to pare its physical assets to the minimum to get the maximum profit = bang from its intellectual capital: the ranks of MBAs and PhDs that filled = its Houston trading floor.=20 Rather than maintain its own expensive gas fields and power plants--which i= t relegated to stodgy utilities and oil companies--Enron would handle every= thing by contract relying on a network of suppliers to obtain store and d= eliver the goods while the company focused on squeezing out the best price.= =20 Dynegy in contrast has invested in such energy assets including three po= wer plants in Southern California. It uses those assets to back its trading= operation which is much smaller than Enron's.=20 Enron pulled off a migration from the dirty extreme of the oil patch the= asset-intensive domain of drillers and explorers to the clean end wher= e all the deals are done on a computer screen. It also was a migration from= lower profit margins and lower risk to high margins and high risk.=20 Shannon B. Burchett chief executive of Risk Limited Corp. an energy-orien= ted strategic-management consultancy in Dallas compared Enron to the inves= tment bank Salomon Bros. where he used to work in the former PhiBro commod= ities unit.=20 Enron Burchett said embodies a Wall Street culture that happens to be in= Houston.=20 Wall Street certainly got it or thought it did.=20 Accounting Rules Pushed to the Limit=20 At Enron's zenith last year when its stock peaked near $90 a share and it = was pushing into esoteric markets for weather derivatives and fiber-optic b= andwidth Enron seemed to be a one-company wave of the future.=20 Enron's aggressiveness brainpower and willingness to back radical new idea= s with serious capital helped it acquire an aura that in some ways was its = undoing analysts said.=20 Investors accorded Enron's stock a price-to-earnings valuation that was con= sistently higher than those of its peers reflecting the view that its cutt= ing-edge business model could consistently deliver faster-growing profit th= an its competitors.=20 To keep profits arcing ever upward to justify the outsize valuation Enron = began pushing the accounting rules as hard as it pushed competitors in the = trading arena. It acknowledged as much in its statement Thursday conceding= that the operations of three of the limited partnerships should have been = consolidated with Enron's own financial statements instead of being held se= parate.=20 By raising capital and running deals through the limited partnerships Enro= n could keep large amounts of debt and certain volatile assets off its own = balance sheet while simultaneously booking profit from the partnerships' t= ransactions analyst Meade said.=20 Deals Backed by Costly Guarantees=20 One risky aspect of some of Enron's deals through the partnerships was what= Meade called a double-trigger guarantee under which Enron would pledge = a cash payout if either its bond rating fell below investment grade or its = stock declined below a certain price.=20 The guarantees must have seemed a cheap way to sweeten a deal when Enron's = stock was flying high but they came back to haunt the company later when = it had to pay cash to make good on its obligations Meade said.=20 Other energy-trading companies use similar devices but Enron carried it to= an extreme and disclosed too little detail to make the process understanda= ble to investors he said.=20 Enron's magic like that of the Internet-stock phenomenon had never been e= asy to understand in the first place. The company had a reputation among an= alysts for providing scanty financial detail and hard-to-grasp explanations= of some of its dealings.=20 But as long as the reported profit kept climbing Enron kept getting the be= nefit of the doubt.=20 M. Carol Coale a respected Houston-based analyst for Prudential Securities= ruefully recalled a time last winter when she told Enron she could find = no positive catalyst for the stock and was considering downgrading her inv= estment opinion.=20 Skilling telephoned Coale and asked her to hold off promising her that the= re was unspecified good news on the horizon that would justify her faith.= =20 I believed him Coale said last week in an interview in Houston. She held= her rating steady at that time but has since downgraded Enron to an outrig= ht sell.=20 Instead of Skilling's promised good news questions mounted during the spri= ng and Enron's stock continued a steady decline. Coale and other analysts = were troubled that a large proportion of Enron's earnings seemed to come no= t from its core trading operations but from unusual transactions involving = the company's own stock or that of affiliates.=20 In California Enron played a key role as chief cheerleader for electricity= deregulation and a key energy middleman in the state. As wholesale electri= city prices soared and the state plunged into its energy crisis late last y= ear Enron and other out-of-state electricity generators and traders became= favorite targets of California politicians and regulators who said the co= mpanies were manipulating the market and charging too much for power.=20 But significantly California was not a directly successful territory for E= nron.=20 Markets in water did not develop as Enron subsidiary Azurix envisioned. And= Enron's plans for selling electricity to retail customers were deferred ev= en as deregulation took effect in 1998 because the state's deregulation for= mulas didn't allow room for retail competition.=20 Lay complained about California frequently and met with the governor to try= to influence the state's moves to repair its energy problems. In an interv= iew in his Houston office in January--overlooking Enron's new headquarters = building which is still under construction as the company's name disappear= s--Lay said he and other Enron executives had objected to the way Californi= a regulation was set up.=20 We objected more vehemently than anyone. We opposed the concept of the poo= l he said referring to the now-defunct California Power Exchange in whi= ch most of the state's power was bought and sold in an hourly market. What= competitive market in the world has a pool? We don't buy our groceries thr= ough a centralized PX.=20 Enron also backed away from building a small power plant in California last= year when the state imposed price caps.=20 One of the loudest complaints by Davis and other California officials was t= hat generators of electricity were playing games to get higher prices.=20 They criticized Enron severely too even though it was not a major generat= or because the level of its worldwide trading operations--buying and selli= ng contracts worth billions of dollars in electric power every day--gave En= ron immense sway over pricing and supplies of electricity. They also believ= e that Enron and Lay helped play a part in the reluctance of federal regula= tors for several months to place restraints on the California marketplace.= =20 CEO's Future Role Uncertain=20 Millions of people in California businesses lost money because this rogue = company succeeded in controlling the government of the United States said= state Sen. Peace one of the architects of the state's deregulation plan.= =20 Ken Lay was a mystic Peace said. Whatever he said had to make sense bec= ause he was Ken Lay. It was hero worship.=20 Many of the people working as economists at the Federal Energy Regulatory = Commission worshiped Ken Lay. As a consequence the things Enron promoted a= nd pushed for were never challenged intellectually and otherwise.=20 Lay who has been asked to sit on the board of the combined company said F= riday that he had not yet decided whether to accept.=20 He described his time building Enron as a very long ride. It's been a very= good ride for the most part.=20 I have to say the last few weeks have not been very much fun he said.=20 *=20 Rivera Brooks reported from Los Angeles and Mulligan from Houston and New Y= ork. Times staff writer James Flanigan in Los Angeles contributed to this r= eport.=20 *=20 RELATED STORY=20 Fallen CEO: Enron's Lay is a brilliant man defeated by arrogance associate= s say. A22=20 RELATED STORY=20 Energy crisis: Power firms have seen their fortunes dim in recent months. S= unday Business C1 PHOTO: Dynegy Chairman and Chief Executive Charles L. Watson right announ= ces the merger with Enron Chairman Kenneth L. Lay. PHOTOGRAPHER: Associ= ated Press PHOTO: This is just a financial bonanza really for both compan= ies says Charles L. Watson Dynegy chairman and chief executive. PHOTO= GRAPHER: Associated Press=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 NEWS Dynegy to acquire Enron in $8.9 billion stock deal / New giant moves out of= shadow LAURA GOLDBERG Staff 11/10/2001 Houston Chronicle 2 STAR 1 (Copyright 2001) Enron Corp. a mainstay of Houston's corporate landscape that helped turn t= he city into a global energy trading powerhouse will disappear in a turn o= f events that would have been unthinkable a month ago.=20 In a deal that will unite two hometown rivals Dynegy announced Friday even= ing it would buy the beaten-down Enron in a stock deal worth almost $8.9 bi= llion plus the assumption of $12.8 billion in debt. The purchase will end Enron's reign as the world's largest energy trader c= atapulting a company to the top that in many ways has been in Enron's shado= w.=20 This could be viewed as Dynegy being the savior of industry in rescuing En= ron the largest energy trader and restoring market liquidity said Carol= Coale a stock analyst with Prudential Securities in Houston who follows = both companies.=20 A much bigger Dynegy - with annual revenues exceeding $200 billion and $90 = billion in assets - will emerge with Chuck Watson its current chairman and= chief executive keeping those roles in the combined company.=20 Layoffs are expected but executives said it was too early to say how many.= Dynegy has almost 1600 employees in Houston Enron has more than 7000 he= re.=20 For Watson the deal is all about growth.=20 It accelerates our strategy some three or four years he said shortly aft= er the deal was announced. This is just a financial bonanza really for bot= h companies.=20 This isn't the way Ken Lay Enron's chairman and chief executive ever thou= ght his years of work would turn out.=20 This would not have been my dream case Lay said in an interview with the= Chronicle shortly after the deal was announced. I would not even have con= templated it three or four weeks ago.=20 Lay has been offered a seat on the combined company's board but hasn't dec= ided yet whether to take it. He won't have any management role once the dea= l closes.=20 He helped take Enron from a staid pipeline company created from a 1985 merg= er to a trading machine that wheels and deals in electricity gas electrici= ty financial contracts used to help companies manage risk and other commod= ities.=20 But Lay said he believed selling Enron was the best option for its sharehol= ders employees and the city considering the company's current battered sta= te.=20 This is the best way to provide certainty to protect this wholesale market= ing and trading franchise which is so valuable he said adding that Enron= looked at two or three other alternatives as it tried to strengthen its ba= lance sheet and add cash to into its operations.=20 Lay said it's not his preference to sell Enron and see its name disappear.= =20 It happens to be the best alternative said Lay. I'm a realist. I knew w= hat needed to be done.=20 Among Enron's troubles: The Securities and Exchange Commission is investiga= ting business deals Enron did with two investment partnerships run by its f= ormer chief financial officer its credibility on Wall Street is close to z= ero a pile of shareholder lawsuits and its credit rating which it relies = on to successfully run its core trading business has been lowered.=20 While other questions had hung over Enron earlier this year the path to it= s end really began Oct. 16 when the company released third- quarter earnin= gs and reported significant financial losses related to the two investment = partnerships.=20 That set in a motion a spiral of events leading to Friday's announcement.= =20 Watson called Lay on Oct. 24 to see if he could do anything to help dispel = rumors that Dynegy had stopped trading with Enron.=20 That conversation led to a meeting at Lay's house days later at which the = two started talking about a deal.=20 As these things go the deal came together quickly especially with so many= question marks hanging over Enron.=20 I think it's important to understand that Ken and I have known each other = for some 20 years Watson said. We have a good understanding of what they= do and how they do it. We knew that their franchise was solid.=20 The recent talks Watson said focused on really understanding Enron's core= business and how it could merge with Dynegy.=20 Added Lay: Good deals come together fast. Bad deals take a little longer.= =20 Under the terms of the deal which is expected to close in six to nine mont= hs:=20 Enron shareholder's get 0.2685 share of Dynegy per Enron share.=20 Dynegy will immediately inject $1.5 billion in Enron to help shore it up. D= ynegy will get that money from ChevronTexaco which owns about 26 percent o= f Dynegy.=20 In return for that money Dynegy will get preferred stock and other rights = in Enron's Northern Natural Gas pipeline system. Should the deal not close= Dynegy has the right to buy all of Northern Natural Gas.=20 At the deal's closing ChevronTexaco will provide another $1 billion to the= combined company.=20 Also at the closing Dynegy's current shareholders will own about 64 percen= t of the combined company with Enron's current shareholder's owning about = 36 percent.=20 Enron will have the right to designate at least three board members for the= combined company which will have 14 board seats.=20 Steve Bergstrom Dynegy's president and Rob Doty Dynegy's chief financial= officer will keep those roles in the new company. Greg Whalley currently= president and chief operating officer of Enron will became an executive v= ice president at the combined company.=20 The deal contains $350 million breakup free that Dynegy would get it anothe= r suitor came in and Enron decided to take a better offer.=20 Watson also said the deal contains escape clauses to protect Dynegy should = it be necessary but he doesn't expect any surprises.=20 We looked under the hood and guess what it's just as strong as we thought= it was he said.=20 Dynegy will talk to analysts and investors on a conference call Monday att= empting to convince them of the deal's value.=20 On paper it looks good said Coale the analyst. We still remain concer= ned about the uncertainties that shroud Enron . . . The risks continue to b= e what we don't know about Enron. We just hope Chuck and his team do all th= e necessary due diligence which is going to take more than a couple weeks.= =20 There are also concerns about merging two different cultures.=20 Looking at cultures the two companies are very different she said. Dyn= egy is a little bit of a fraternity. Chuck started this company and I'm sur= e he has a heartfelt emotion toward making things work at Dynegy. Enron is = a mercenary aggressive cutthroat culture.=20 At the start of the year Enron was still heralded as an innovator for othe= rs to emulate. Since a series of problems began chipping away at Enron's i= mage.=20 But such concerns were mostly pushed aside for as long as the company's sto= ck price performed well and its core energy trading business turned out hig= her and still-higher profits.=20 The company's woes became more serious and quickly multiplied after it made= troubling financial disclosures in its third-quarter earnings report Oct. = 16.=20 It disclosed that day it had taken a $35 million loss and reduced sharehold= ers equity by $1.2 billion related to ending business dealings with two inv= estment partnerships formerly run by Andrew Fastow its chief financial off= icer.=20 The disclosures heightened Wall Street's ongoing concerns that Enron's fina= ncial reporting was too difficult to understand and skimped on details. It = also led to fears that Enron would be on the hook for billions of dollars r= elated to other financial vehicles.=20 Days later Enron revealed that the SEC was investigating transactions betw= een Enron and the partnerships called LJM Cayman and LJM2 Co-investment. I= t also replaced Fastow and has been hit with a growing number of shareholde= r lawsuits.=20 Then the company's credit rating was downgraded which raised questions ab= out its ability to manage its core energy trading business.=20 As Wall Street's questions grew Enron retreated into silence leaving anal= ysts and investors to speculate on worst-case scenarios which fed fears th= at company was facing a cash-crunch and caused investors to keep dumping th= e stock.=20 That in turn led some of Enron's trading partners to shift business elsewh= ere and raise their credit requirements to do business with Enron which in= turn raised even more fears about a cash- crunch and the company's short-= term stability.=20 Thursday Enron said it is restating its finances as far back as 1997 to in= clude losses related to a number of complex partnerships it created.=20 . . .=20 DEAL AT-A-GLANCE=20 Company name: Dynegy.=20 Key players: Chuck Watson Dynegy's current chairman and CEO will remain c= hairman and CEO. Enron Corp.'s CEO and Chairman Ken Lay has been offered a = seat on Dynegy's board.=20 The trade: 0.2685 share of Dynegy for each share of Enron Corp.=20 Value of the deal: $8.85 billion in stock and $12.8 billion in Enron debt.= =20 Dynegy's close Friday: $38.76=20 Enron's close Friday: $8.63 a share.=20 Status of Enron Field name: Unknown. However Dynegy registered the name ww= w.dynegyfield.com on Thursday.=20 . . .=20 MORE STORIES=20 Enron Corp. paid $100 million to put its name on the Houston Astros' new do= wntown home. Now that the energy giant is being bought the name may soon b= e history.=20 The sale of Enron Corp. will likely punish Houston's downtown office market= emptying more office space at a time when several new buildings are going= up.=20 Never make predictions especially about the future Ken Lay once wrote i= n an essay concerning the world's energy needs. Enron's chief executive mig= ht be taking those words to heart today.=20 Dynegy's Chuck Watson has always maintained a low profile prompting some p= eople to label him as the most influential Houstonian you've never heard of= .=20 See these stories and more in Business.=20 . . .=20 The companies=20 Profiles of two Houston energy giants that announced their merger Friday:= =20 DYNEGY Headquarters: Houston=20 Chairman and CEO: Chuck Watson=20 Revenues in 2000: $29.4 billion=20 Employees: 6000 worldwide=20 Electricity sales (2000): 137.7 million megawatt hours=20 Gas sales (2000): 10.9 billion cubic feet per day=20 Business segments: Dynegy Marketing and Trade Dynegy Midstream Services I= llinois Power Subsidiary Dynegy Global Communications=20 History: The company traces its roots to 1984 when the investment banking f= irm Morgan Stanley the law firm Akin Gump Strauss Hauer & Feld and six n= atural gas pipelines teamed up to create a natural gas marketing firm calle= d U.S. Natural Gas Clearinghouse Ltd. Chuck Watson joined the company in 19= 85 and the operation was revamped the pipeline partners bought out and th= e name shortened to Natural gas Clearinghouse. In 1995 the company purchas= ed Trident NGL Holdings quadrupling its liquids business. The company went= public for the first time under the new name NGC Corp. that same year. In = 1996 NGC merged with Chevron's gas and gas liquids business. The firm purc= hased its first power plants with the acquisition of Destec in 1997 and cha= nged its name to Dynegy in 1998 to reflect expansion beyond natural gas. Th= e company has continued to grow through acquisitions.=20 . . .=20 ENRON Headquarters: Houston=20 Chairman and CEO: Ken Lay=20 Revenues in 2000: $100.8 billion=20 Employees: 20000 worldwide=20 Electricity sales (2000): 590.2 million megawatt hours=20 Gas sales (2000): 28.3 billion cubic feet per day=20 Core areas: Enron Wholesale Services Enron Energy Services Enron Transpor= tation Services=20 History: The company was formed in 1985 as a result of the merger of Housto= n Natural Gas and InterNorth a natural gas company based in Omaha Neb. Th= e deal integrated several pipeline systems to create the first nationwide n= atural gas pipeline system. In 1986 Ken Lay CEO of Houston Natural gas w= as named chairman and CEO and the name Enron was chosen. In 1989 Enron = began trading natural gas commodities through its GasBank a precursor to t= oday's wholesale trading business. Enron made its first electricity trade i= n 1994 and eventually became the world's biggest marketer of electricity an= d gas. Photo: 1. Ken Lay chairman and CEO of Enron Corp. listens glumly at a Fri= day news conference as Chuck Watson chairman and CEO of Dynegy discusses = his company's acquisition of Enron (color) 2. DEAL AT-A- GLANCE (text) 3.= MORE STORIES (text) 4. The companies (b/w p. 16 text)=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Financial Enron Accepts $8 Billion Buyout Offer From Dynegy Energy Giant Was Forced = to Negotiating Table After Disclosing That It Had Overstated Earnings Peter Behr Washington Post Staff Writer 11/10/2001 The Washington Post FINAL E01 Copyright 2001 The Washington Post Co. All Rights Reserved Embattled Enron Corp. yesterday accepted a buyout offer valued at about $8 = billion from crosstown rival Dynegy Inc. If the deal is completed it would= end Houston-based Enron's reign as the leader in the huge energy trading m= arkets that set the prices of power and natural gas in the nation.=20 Its cash dwindling and its credit rating hammered Enron was forced to the = negotiating table after its recent disclosures that its obligations to a co= mplex web of partnerships involving company officials had caused the tradin= g powerhouse to overstate its earnings and obscure its total debt obligatio= ns. Four top Enron officials have resigned or been replaced since July and= once Dynegy takes control Enron's chairman and chief executive Kenneth L= ay will also leave the company. Lay said yesterday that he had not decided= whether to accept Dynegy's offer to serve on the combined company's board. It's been a good ride for a long time Lay said in a conference call last= night. The last three weeks haven't been a whole lot of fun.=20 The final deal was announced after the close of stock trading. Enron's shar= es -- which had fallen from $33 to $8 after the disclosures -- ended the da= y slightly higher at $8.63. Dynegy's stock closed at $38.76 up $2.26.=20 Dynegy offered all stock for the Enron shares so the total value of the de= al will fluctuate with Dynegy's stock price. Dynegy also said it would assu= me about $13 billion in Enron debt bringing the total value of the transac= tion to around $21 billion.=20 Dynegy's rescue of Enron will begin with an immediate cash infusion of $1.5= billion which will be supplied by ChevronTexaco Corp. a major Dynegy sto= ckholder. ChevronTexaco will invest another $1 billion in Dynegy after the = acquisition has passed regulatory review and is completed which executives= said they expect will take six to nine months as Enron tries to unscramble= the complex partnerships that are now under investigation by the Securitie= s and Exchange Commission.=20 The takeover agreement gives Dynegy an escape clause permitting it to cance= l the purchase if Enron winds up with heavy regulatory fines or legal judgm= ents from shareholder suits tied to its handling of the partnerships.=20 Chuck Watson Dynegy's chairman and chief executive said in the conference= call that a close scrutiny over the past two weeks of Enron's financial co= ndition convinced him that the company's trading and pipeline businesses we= re solid. We looked under the hood and guess what? It looked just as stro= ng as we thought it was. Watson said he did not think more damaging disclo= sures were forthcoming from Enron.=20 Until the partnership mess Enron was the nation's dominant energy trader = and it had front-door political connections to the White House. Lay its lo= ngtime chairman raised more then $100000 for the presidential election ca= mpaign of his friend George W. Bush. Enron rode the growth of energy tradin= g markets beginning in the mid-1990s as first natural gas and then electr= ic power sales were deregulated at the wholesale level. Its revenues leaped= from $9.2 billion in 1995 to $100.8 billion last year.=20 During those heady times the Houston company could choose which questions = to answer about its dealings with related partnerships and its Byzantine bo= okkeeping.=20 It was always very difficult to get information said Louis B. Gagliardi= an analyst with John S. Herold Inc. They would always rebuff you.=20 Until this fall the muscular company seemed too big to stumble said inves= tment manager David Coxe with Harris Insight Equity Fund in Chicago.=20 Coxe bought 78000 shares of Enron at $40 a share in August after wrestlin= g with the decision for months he said. Then Jeffrey Skilling Enron's chi= ef executive and strategic mastermind unexpectedly resigned. The stock wh= ich had been as high as $90 in August 2000 pitched downward.=20 Enron seemed so indispensable to the nation's energy markets that I though= t it inconceivable it could implode Coxe said. That's how I got sucked i= n.=20 Enron's fall is classic hubris Coxe said: a Greek tragedy striking someo= ne who chose to defy the gods -- in this case the rules of the system.= =20 Among the rules that Enron now acknowledges it didn't follow were the accou= nting standards that applied to the complex partnerships it created. The pu= rpose of the partnerships Enron said was to reduce the risks of investmen= ts in Internet transmission systems and to sell power plants and other asse= ts it no longer wanted.=20 The accounting errors were described in a 20-page SEC filing Enron made Thu= rsday. The errors resulted in a $1.2 billion reduction in the value of shar= eholders' equity. The company also said it had overstated its earnings by $= 586 million since 1997.=20 Enron created partnerships that would buy major assets -- such as a power p= lant -- that Enron wanted to sell or in other cases assets such as fiber-= optic cable networks that Enron intended to run but did not want to have on= its balance sheet.=20 The partnerships had outside investors but the general partner of two of t= hem was Enron's own chief financial officer Andrew Fastow. He earned $30 m= illion in fees from managing two of the largest partnerships according to = the SEC document.=20 Enron added to the capital of these partnerships by pledging its stock or = securities convertible into stock. Some of those stock transactions should = have been counted as loans resulting in the $1.2 billion drop in sharehold= er equity Enron now says.=20 Investors are asking why Enron's auditor Arthur Andersen LLP did not insi= st that these transactions be handled that way in the first place. Enron's = SEC filing mentions but does not explain some proposed audit adjustments = over the past four years that were overruled.=20 Even though as Enron now acknowledges it created an information barrier = masking critical information and violating standard accounting rules many = financial analysts who were recommending the stock to investors were not pu= shing hard enough to punch through that barrier some analysts acknowledge.= =20 It was so complicated that everybody was afraid to raise their hands and s= ay 'I don't understand it' Gagliardi said.=20 The questions are now coming from a new committee reporting to Enron's boa= rd that will investigate how the company's financial reporting was handled= from the SEC and eventually from teams of lawyers representing aggrieve= d shareholders.=20 Lay indicated yesterday he had not been aware until recently that Enron emp= loyees other than Fastow had profited from the partnership activity. Enron = directors had approved Fastow's management of the partnerships but Fastow = quit the partnerships in July and was then replaced as chief financial offi= cer.=20 Enron this week fired Treasurer Ben Glisan and Kristina Mourdant an Enron = division lawyer who it said had invested in partnerships that were tied to= one of the major partnerships headed by Fastow. The Enron report to the SE= C describes a central role in these transactions played by Michael J. Koppe= r an associate of Fastow who left Enron in July to take over Fastow's fina= ncial interests in the partnership the company said.=20 Enron will hold a conference call next week to discuss what it has uncovere= d about outside partnership investments. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Financial Desk The Nation NEWS ANALYSIS A Visionary Fallen From Grace JAMES FLANIGAN TIMES STAFF WRITER 11/10/2001 Los Angeles Times Home Edition A-22 Copyright 2001 / The Times Mirror Company A year ago Enron Corp. Chairman Kenneth L. Lay was on top of the energy wo= rld. As a leading fund-raiser contributor and energy advisor to the Bush a= dministration he played a key role in shaping the new president's energy p= olicy. As head of the world's largest energy trading company he had an eno= rmous influence on the price of energy in California and across the nation.= Enron's highflying stock helped him cash out $123 million in stock options= last year alone.=20 On Friday with Enron being saved from financial collapse by agreeing to be= acquired by rival Dynegy Inc. Lay's career and reputation are in shambles= . Under the merger he will be stripped of a management job. His integrity = is tattered with Enron's controversial financial dealings under federal in= vestigation. Enron investors and employees are chagrined and outraged becau= se the company's stock lost 80% of its value in recent weeks. The rapid rise and fall of Lay 58 is a story of how a brilliant man with = innovative ideas and a grand scheme to transform the world's energy markets= was overcome with arrogance associates and critics say. Under Lay Enron = stretched the limits of the law and took risks that nearly caused its finan= cial collapse they say. That in turn could have resulted in a widespread d= isruption in energy supplies.=20 Enron's behavior casts doubt on the integrity of our financial markets. It= is a very serious matter said Edward R. Muller an energy investor and f= ormer president of Edison International's Mission Energy subsidiary.=20 Nobody denies he's smart but it's a question of integrity said Raymond = Plank chief executive of Apache Corp. and an associate of Lay's in Houston= 's vibrant oil and gas industry.=20 Lay and longtime partner Jeffrey K. Skilling who served briefly as Enron's= chief executive before resigning abruptly in August rose to prominence in= the last decade through the use of innovative financial techniques designe= d to exploit a reduction in government regulation of energy.=20 Lay transformed world energy industries through his vision of new market-d= riven ways to finance natural gas and electricity production and transmissi= on.=20 The financial markets that Lay and his Enron associates created had an enor= mous effect on California's disastrous experiment in electricity deregulati= on. Critics say his influence was excessive and misguided.=20 Ken Lay was a mystic said state Sen. Steve Peace (D-El Cajon) an outspo= ken critic of Enron. Whatever he said had to make sense because he was Ken= Lay. It was hero worship. Many of the people working as economists at the = Federal Energy Regulatory Commission worshiped Ken Lay. As a consequence t= he things Enron promoted and pushed for were never challenged intellectual= ly and otherwise.=20 Lay who has a doctorate in economics had modest beginnings as the son of = a poor country preacher who did farm labor on the side to raise money for h= is children's education. In the Navy in the late 1960s Lay was assigned to= the Defense Department because of his economic acumen. He allocated Penta= gon dollars more efficiently in purchasing for the military said Mark Pal= mer chief spokesman for Enron.=20 Lay worked for Exxon and other energy firms in the 1970s amid soaring oil = prices gasoline shortages and still-regulated natural gas. He headed Houst= on Natural Gas a predecessor firm of Enron in the 1980s as falling prices= for oil and natural gas presented grave problems for Houston's energy indu= stries.=20 When the federal government allowed pipelines to carry the gas of any produ= cer Lay turned Enron into a foremost firm in the new deregulated industry= . Still Enron almost went bankrupt in the late 1980s with natural gas in = oversupply and prices falling.=20 It was then that Skilling a McKinsey & Co. consultant suggested to Lay th= at the firm trade long-term contracts for gas promising to deliver the com= modity to customers at fixed prices buying and selling contracts of varyin= g maturities the way mortgage companies deal with mortgages in Skilling'= s words.=20 The innovation started Enron's rapid growth and rise to prominence as the e= mbodiment of a new kind of energy company. In the 1990s the federal govern= ment called for deregulation of electricity.=20 Lay saw opportunities. He and Skilling created a market for contracts in el= ectricity in 1994 and by 1996 Enron was the world's leading firm doing suc= h business.=20 Lay's central idea was that by creating a market of millions of buyers and= sellers constantly taking positions power supplies could be allocated eff= iciently and prices lowered. Lay liked to lecture in an avuncular way abo= ut the new economics of energy trading.=20 Technology is changing and there's a lot more value in flexibility and op= tionality. Just about in every industry you can make them a lot more effic= ient when you have more optionality Lay said in an interview in January i= n his Houston offices overlooking the sparkling new Enron headquarters buil= ding which still is under construction.=20 As Enron's business profile grew so did Lay's political influence. He serv= ed as an energy advisor to both Bush administrations and headed Texas fund-= raising for George W. Bush's presidential campaign. Lay raised $100000 for= the Bush-Cheney campaign and with his wife Linda Lay contributed anothe= r $100000 to help finance the inaugural gala this year.=20 As the administration prepared its energy plan Lay gained national stature= as a preacher of market economics applied to electricity.=20 There's no way you can centralize a command-control environment and make t= he best decisions to have an efficient low-cost reliable electricity indu= stry Lay said.=20 His sermon was intended for California which suffered sharply higher price= s for electricity last winter to the point that private utilities fell int= o or near bankruptcy and the state budget incurred a cost of $12 billion w= hich Sacramento now is trying to recover through the sale of revenue bonds.= =20 Because Enron trading billions of dollars a day in power contracts worldwi= de had an immense effect on electricity prices Lay's preaching grated on = state officials. Driven to intemperance state Atty. Gen. Bill Lockyer said= in May that he'd like to escort Lay to a prison cell.=20 But more than economic philosophy was behind Lay's goading of California. T= he state's debacle gave energy deregulation a bad name and chilled deregula= tion moves by many other states.=20 That in turn reduced growth prospects for Enron. The promise of continued g= rowth in deregulation had helped make Enron a Wall Street darling. Its stoc= k price at one point nearly $90 a share versus less than $10 now pushed u= p the value of Enron stock options held by almost all employees but owned = in great amounts by Lay Skilling and other company officers.=20 Lay cashed in last year converting options for a gain of $123 million whi= le Skilling gained $62 million by converting his options. As they cashed in= Enron was encountering other problems. Attempts to set up trading markets= in water and broadband Internet transmission were floundering. A major pow= er plant venture in India was in grave economic and political trouble.=20 But in the last month Enron revealed that it had reduced the firm's equity= value by more than $1 billion due to write-offs in a hitherto hidden partn= ership.=20 Revelations then cascaded. The firm had 33 such partnerships which had bil= lions of dollars in debt for which Enron was liable. Lay and Skilling piled= up debt in hidden partnerships analysts explain because the firm needed = huge amounts of debt to support its greatly expanding levels of trading in = electricity natural gas and other commodities.=20 But the firm could not support such debt and still retain its credit rating= growth rate and high stock price. After weeks of gamely protesting that t= he business was sound and that he personally took offense at investment ana= lysts' suggestions of impropriety Lay fell silent.=20 *=20 Times staff writer Nancy Vogel in Sacramento contributed to this report. PHOTO: With the takeover of his once-soaring firm Enron chief Kenneth Lay'= s career is in tatters. PHOTOGRAPHER: Reuters=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 BUSINESS DYNEGY TIMELINE 11/10/2001 Houston Chronicle 3 STAR 3 (Copyright 2001) Natural Gas Clearinghouse is formed by the investment banking firm Morgan S= tanley and the law firm Akin Gump Strauss Hauer & Feld. Six natural gas = pipelines got together to create the gas marketing firm.=20 The U.S. Federal Energy Regulatory Commission begins the long process of de= regulating the natural gas business which ultimately created huge markets = for the company and competitors such as Enron. NGC introduces its energy store concept looking to create a one- stop sh= opping outlet for all energy products and services.=20 NGC makes initial public offering.=20 NGC acquires Trident NGLs.=20 NGC merges with the natural gas business unit of Chevron Corp. and Chevron'= s Warren Petroleum Co. subsidiary.=20 In February NGC announces a deal to expand its energy store with the pur= chase of Destec Energy's interest in 20 U.S. power plants for $1.27 billion= . The Destec deal is the company's first purchase of power-generation asset= s.=20 With deregulation right around the corner we have been aggressively looki= ng to acquire major power-generation assets to complement the expertise tha= t we already have in our power marketing Watson said.=20 NGC's stock trades around $22 per share in late February when the company d= iscloses that excessive high-cost inventories of natural gas liquids or NG= Ls would cut operating income by $40 million. The price plunged to the mid= teens before partially recovering to about $18. Watson says NGC has put com= munications and information- reporting systems in place to alert management= to developing problems much earlier than they learned of the NGL-related p= roblems.=20 In May NGC is honored as the Chronicle 100 company of the year for its ste= llar 1996 results.=20 NGC buys Southern California Edison Assets.=20 In March Chuck Watson and Bob McNair team up to put in the winning bid of = $530000 for the grand champion steer named Rowdy. The pair pay the record= price days after joining city officials on a trip to help lobby for an NFL= team.=20 In June NGC adopts a new name - Dynegy - a word created by merging dynamic= and energy. The name NGC no longer captures who we are and who we have be= come says Watson the company's chief executive. The company will have th= ree logos all derived from the Chinese tangram a collection of seven red= yellow and blue geometic shapes that can be arranged in any number of comb= inations.=20 In December a Dynegy joint venture announces the purchase of a power plant= and other assets from San Diego Gas & Electric.=20 In June Dynegy agrees to a $2 billion takeover with Illinova an Illinois = electric and gas company that would give the energy marketing company elect= ric plants and lines located in major Midwest markets. This deal the large= st in the company's history to date brought one company trying to move bey= ond the traditional utility business together with a trading company moving= into that business.=20 In October Watson who owns the Houston Aeros hockey team announces he wo= uld help fund the campaign against the downtown arena. The arena measure is= later defeated but was approved in a new vote the next year after Watson = agrees to support it.=20 In February Dynegy sells natural gas pipelines and processing plants for $= 308 million in cash. It is part of a planned $600 million asset sale to red= uce its debts as Dynegy closed its $2 billion merger with Illinois utility = Illinova.=20 In August Dynegy agrees to buy two power plants in the Hudson River Valley= region of New York from CH Energy and two other utilities for $903 million= . The deal marks Dynegy's expansion into the Northeast power market.=20 Dynegy branches into the broadband Internet and telecommunications busines= ses by buying privately held Extant for $151.3 million in cash and stock.= =20 In July Dynegy says it will spend about $590 million to buy natural gas st= orage facilities in the United Kingdom in a deal that will serve as the cor= nerstone of its European energy network. It will buy BG Storage a wholly o= wned subsidiary of BG Group. The deal is part of Dynegy's strategy to repli= cate in Europe the energy delivery network it has built in the United State= s.=20 In September after 17 years in business Dynegy launches its first ad camp= aign. The spots released in conjunction with the PGA Tour Championship em= phasize the firm is passionate about what it does.=20 On Nov. 9 Dynegy announces plans to purchase Enron Corp. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 BUSINESS POWER PLAY / ENRON TIMELINE 11/10/2001 Houston Chronicle 3 STAR 4 (Copyright 2001) Houston Natural Gas merges with Omaha Neb.-based InterNorth to create the = company that would eventually be named Enron Corp. The deal integrated seve= ral pipeline systems to create the first nationwide natural gas pipeline sy= stem.=20 Ken Lay who had been chief executive officer of Houston Natural Gas is na= med chairman and chief executive officer. The company chooses the name Enro= n after rejecting Interon. Enron discovers that oil traders in New York have overextended the company'= s accounts by almost $1 billion. The company ultimately works this loss dow= n to $142 million. This leads to Enron developing a myriad of services to h= elp reduce the risk of price swings for everything from gas to advertising = space.=20 Enron opens its first overseas offices in England to take advantage of the = country's privatization of its power industry. The company's major strategy= shift - to pursue unregulated markets in addition to its regulated pipelin= e business - is revealed to executives in a gathering that became known as = the Come to Jesus meeting.=20 Jeffrey Skilling joins the company and Enron launches its Gas Bank a progr= am under which buyers of natural gas can lock in long- term supplies at fix= ed prices. The company also begins to offer financing for oil and gas produ= cers.=20 Enron acquires Transportadora de Gas del Sur Enron's first pipeline presen= ce in South America and the start of a push to expand on the continent.=20 Enron's Teesside power plant in England begins operation one of the first = big successes for the company's international strategy.=20 Enron makes its first electricity trade beginning what will turn out to be= one of the company's biggest profit centers in the next few years.=20 Enron Europe establishes a trading center in London marking the company's = entry into European wholesale markets. Europe is now considered one of the = company's prime growth markets.=20 Construction begins on the first phase of the Dabhol power plant in India. = The $2 billion project would be plagued with political problems throughout = its construction. Enron puts its stake in the project up for sale in 2001.= =20 In December Skilling is elected president and chief operating officer and = will continue in his role as chairman and CEO of Enron Capital & Trade Reso= urces.=20 To expand its electricity business Enron buys Portland General Electric Co= rp. the utility serving the Portland Ore. area. In 2001 Enron agrees to= sell Portland General Electric to Northwest Natural Gas Co. for about $1.9= billion.=20 Enron Energy Services is formed to provide energy management services to co= mmercial and industrial customers.=20 Enron acquires Wessex Water in the United Kingdom which forms the basis fo= r its water subsidiary Azurix.=20 Enron forms its broadband services unit. The first phase of the Dabhol proj= ect begins operations. One-third of Azurix is sold to the public in an init= ial public offering. After an early rise shares fall sharply as the year g= oes on and the problems facing the company become apparent. Enron Online t= he company's commodity trading Internet site is formed. It quickly becomes= the largest e-business site in the world. Enron Energy Services turns its = first profit in the fourth quarter.=20 Rebecca Mark resigns from her position as Azurix chairwoman and the company= announces a plan to take the troubled water subsidiary private.=20 Annual revenues reach $100 billion more than double the year before refle= cting the growing importance of trading.=20 Enron Field is opened in downtown Houston. In addition to buying the naming= rights Enron Chairman Ken Lay helped raise financial support for the cons= truction project.=20 The Energy Financial Group ranks Enron the sixth-largest energy company in = the world based on market capitalization.=20 Enron and strategic investors IBM and America Online launch The New Power= Co. to provide electric service in a deregulated market.=20 In February Jeff Skilling takes over as chief executive officer. Ken Lay r= emains as chairman.=20 In March Enron and Blockbuster call off deal to bring movies into homes ov= er the Internet.=20 In April Enron discloses it is owed $570 million by bankrupt California ut= ility Pacific Gas & Electric Co.=20 In August Skilling unexpectedly resigns for personal reasons. Lay takes ba= ck the CEO job. Wall Street starts cranking up its requests for Enron to pr= ovide more detailed financial information about its performance.=20 In October Enron releases third-quarter earnings with $1.01 billion in ch= arges including $35 million related to investment partnerships formerly he= aded by Andrew Fastow Enron's chief financial officer. Fastow is replaced = as CFO. The Securities and Exchange Commission launches a formal investigat= ion into the partnerships.=20 In November Enron restates earnings for 1997 through 2000 and the first th= ree quarters of this year.=20 On Friday Dynegy announces it wants to merge with Enron. Enron's stock clo= ses at $8.63 per share an 89 percent drop since the beginning of the year. Mug: Jeffrey Skilling=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 BUSINESS POWER PLAY / Enron had been a political heavyweight / Critics decried influ= ence of Ken Lay in White House DAVID IVANOVICH Houston Chronicle Washington Bureau Staff 11/10/2001 Houston Chronicle 3 STAR 4 (Copyright 2001) WASHINGTON - Until a few weeks ago Enron Corp. was the star of the Washing= ton lobbyist corps.=20 Enron Chairman Ken Lay was known to have the ear of his longtime friend and= political ally President Bush. Vice President Dick Cheney had unveiled a national energy strategy very muc= h to Enron's liking while one of the company's favorite electricity regula= tors Texas' Pat Wood III had been installed as the new head of the Federa= l Energy Regulatory Commission.=20 Critics feared the Houston-based energy and trading giant exerted far too m= uch influence both in Congress and in the Bush White House.=20 Now after the company's implosion Enron's legendary political might is ev= aporating as well political observers say.=20 Just a matter of weeks or months ago Enron was still the 800- pound goril= la said Steven Weiss a spokesman for the Washington- based Center for Re= sponsive Politics a political watchdog group. It was getting into any mee= ting it wanted to.=20 Relationships are still existent and Bush is unlikely to completely ignor= e Ken Lay. But one would have to think the amount of influence that Ken Lay= could exert now pales in comparison to the influence he could have exerted= just a month or more ago.=20 Now that Dynegy has agreed to take over Enron the companies' role in gover= nment will be determined by Chuck Watson Dynegy's chief executive officer.= =20 While Enron has been such a player in Washington Dynegy is less known insi= de the Capital Beltway. But that's not to say Dynegy has no political pull = on Capitol Hill.=20 Ken Lay certainly can get meetings with senators but so can Chuck Watson= a Senate staffer said.=20 While Dynegy may be attracted to Enron's energy trading whiz the company m= ay be desirous of Enron's political expertise as well. While Watson has had= a presence on the national stage his role in Houston's stadium votes show= s he is hardly allergic to politics.=20 Enron's recent troubles however may leave a stain. With the Securities an= d Exchange Commission conducting an investigation into some of the company'= s business dealings many politicians are likely to be wary.=20 Politicians perhaps better than anyone else can smell a rotten egg Wei= ss said. Who would want it reported in the newspaper that they are associa= ted with a company that is under investigation?=20 Enron's lobbyist in Washington Linda Robertson could not be reached for c= omment.=20 A setback among Washington's elite would be a novel experience for Lay and = other Enron officials. In a city where access is everything Lay has proved= - time and again - his political savvy.=20 A one-time energy policy-maker for Richard Nixon Lay successfully champion= ed deregulation of the natural gas pipeline industry and has led the effort= to open up the electricity markets as well.=20 A Republican Lay served as co-chair of the host committee for the GOP's na= tional convention in Houston in 1992 when his friend George Bush the elder= was nominated for a second term. And yet there was Lay a few years later = playing golf with the elder Bush's political nemesis Bill Clinton and adv= ising the Democratic administration on energy.=20 The company has excelled at snatching up political heavyweights as they lea= ve public office. Enron has attracted the likes of former Secretary of Stat= e James Baker III and one-time Clinton White House chief of staff Thomas M= ack McLarty.=20 Enron's stable of political lobbyists became a who's who of Washington insi= ders from former Christian Coalition head Ralph Reed to one-time Energy Re= gulatory Commission Chairwoman Elizabeth Betsy Moler.=20 And by all accounts Enron - and Lay especially - rank among the most munif= icent contributors to George W. Bush's political career. Lay's name was men= tioned repeatedly as Bush drew up his Cabinet and while he did not join th= e government he played a role in helping craft Bush's energy strategy.=20 Lay and other Enron officials spent $2.1 million lobbying Congress and the = White House last year the Center for Responsive Politics reported.=20 In fact 71 senators and 188 House members have received contributions from= Lay and other Enron officials the watchdog group found.=20 Questions about Lay's influence over the Federal Energy Regulatory Commissi= on sparked an investigation last summer by Congress' General Accounting Off= ice.=20 Curt Hebert then the commission chairman accused Lay of trying to prod hi= m into changing his position on an issue of key concern to Enron open acce= ss by independent electricity generators to the power lines owned by utilit= ies in exchange for Lay's political support.=20 The GAO found no evidence of wrongdoing by either party. Three months after= the dispute became public Hebert resigned from the commission. He was suc= ceeded by Wood whom Enron officials had championed as smart hard-working= fair.=20 Just one month ago Enron's political muscle appeared undiminished. Enron h= eld a conference in Washington on energy policy during the first week of Oc= tober attracting the likes of Wood Senate Energy Committee Chairman Jeff = Bingaman D-N.M. and former Energy Department Secretary James Schlesinger.= =20 Since the start of the company's free-fall Enron officials have been less = on Capitol Hill although that may have merely reflected the city's preoccu= pation with the war on terrorism and the anthrax scare. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 BUSINESS POWER PLAY / Sale suddenly switches office outlook downtown RALPH BIVINS Staff 11/10/2001 Houston Chronicle 3 STAR 1 (Copyright 2001) THE sale of Enron Corp. is going to punish Houston's downtown office market= - emptying more office space at a time when several buildings are going up= .=20 Enron and its purchaser Dynegy are both hefty users of downtown office sp= ace and with staff cutbacks likely they will need a lot less of it. Enron's 40-story office tower which is under construction on Smith Street= is expected to be completed next year.=20 If they do go through with the deal that building is not going to be the = Enron building. It's going to become the Dynegy building said office brok= er Sanford Criner of the Trione & Gordon realty firm.=20 Dynegy which leases 700000 square feet in the Wells Fargo Plaza at 1000 L= ouisiana would jump at the chance to operate in the new trading floors at = the new Enron Center South according to a number of downtown office broker= s.=20 There's no question Dynegy has been looking to get a major league trading = floor for a long time Criner said. They definitely covet the Enron tradi= ng floor.=20 The new 1.2 million-square-foot Enron tower is a palace of energy trading t= echnology with miles of telecommunications cable running throughout.=20 The building's matching pair of sweeping staircases were intended to lead t= o the corporate dens of Enron Chairman Ken Lay and former CEO Jeff Skilling= but probably will be used by Dynegy Chairman Chuck Watson.=20 John Sousa a spokesman for Dynegy said Thursday that the firm's current W= ells Fargo space is good and it was too soon to speculate about things like= office space.=20 We're satisfied with our current location Sousa said.=20 A number of office brokers however suggest Dynegy would move over to the = Enron building and attempt to sublease at least some of the space in Wells = Fargo Plaza.=20 Enron's importance to the Houston office market extends beyond the new buil= ding. The company occupies about 3 million of the 42 million square feet of= office space available downtown if every small building is counted.=20 Enron occupies its existing 1.25 million-square-foot headquarters building = at 1400 Smith 500000 square feet of space in Three Allen Center 60000 s= quare feet in the 500 Jefferson building and 40000 square feet in the 600= Jefferson building.=20 Enron has already moved a few employees into its new building which had be= en slated to be fully occupied by next summer.=20 This has some real implications said George Carpenter of Carpenter Realt= y. Who knows when the dust settles where this thing is heading?=20 TrizecHahn which owns the Cullen Center and Allen Center properties had b= een expecting Enron to move out of at least a portion of those buildings wh= en the new Enron Center South building was complete.=20 We're bullish on Houston said TrizecHahn spokesman Rick Matthews. It's = likely to remain a core market for us.=20 Enron's shrinkage will come on top of several other moves that will empty d= owntown office space.=20 It's going to be a blood bath next year said one Houston office broker w= ho asked that his name not be used.=20 About 500000 square feet of space will become vacant next year in the Chev= ron Tower according to Trione & Gordon. A number of Chevron employees will= be moving into the Texaco Heritage Plaza building as a result of the Chevr= on and Texaco merger.=20 Halliburton another huge downtown office tenant will be moving out of dow= ntown to new buildings in the Westchase area in the next few years leaving= behind a large hole of vacant space at 601 Jefferson.=20 While the demand for office space is beginning to fall the supply is about= to increase.=20 The 5 Houston Center a 27-story structure that will be complete next year= will open with a significant number of signed tenants. But as major corpor= ate tenants such as Ernst & Young Jenkens & Gilchrist and Jackson Walker m= ove into the building they will leave behind vacant space in others.=20 Century Development's 1000 Main building is scheduled to be finished in 200= 3. The 783000-square-foot project which will have Reliant Resources as it= s main tenant still has more than 200000 square feet of space to lease a= ccording to Trione & Gordon.=20 And even more space will be coming onto the market when the 32- story Calpi= ne Center office tower is completed at 717 Texas Ave. in 2003.=20 With these changes the health of the downtown office market has gone from = being robust to sickly in a short period of time.=20 The Central Business District is going to be going through some rough time= s said Bob Parsley chief executive officer of Colliers International rea= lty firm.=20 Class A space - the most expensive prime office space - in downtown is now= over 97 percent occupied a very high rate that encouraged developers to s= tart new office towers.=20 The looming downturn in the office market is not expected to be nearly as b= ad as the crash of the 1980s but there could be some painful times ahead f= or downtown landlords.=20 There are going to be some big blocks of space in downtown Houston said = Candace Baggett president of the Calibre Group realty firm.=20 . . .=20 Location of Enron's operations and Dynegy's headquarters=20 1. Enron headquarters 1400 Smith 1.25 million square feet.=20 2. Enron Center South (under construction) 1.2 million square feet.=20 3. Three Allen Center 500000 square feet leased by Enron=20 4. 600 Jefferson 40000 square feet leased by Enron=20 5. 500 Jefferson 60000 square feet leased by Enron=20 6. Dynegy headquarters Wells Fargo Plaza 700000 square feet.=20 7. Enron Field Opened 2000 Map: 1. Location of Enron's operations and Dynegy's headquarters (color te= xt) Photos: 2. Enron employees kept their cell phones in use outside the c= ompany's downtown offices Friday afternoon. Dynegy's purchase of Enron deal= s a blow to the city's office space market. Enron's shrinkage will come on = top of several other moves that will empty downtown office space (p. 4)=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 BUSINESS POWER PLAY / Enron Field name may fall as quickly as energy empire RALPH BIVINS Staff 11/10/2001 Houston Chronicle 3 STAR 1 (Copyright 2001) BASEBALL history is written fast these days.=20 As Enron Corp. the massive Houston energy-trading company is to be bought= out by Dynegy the name Enron Field may go with it. Enron paid big money - $100 million - to put its name on the retractable-ro= of stadium downtown. It cost a lot to get the name but it gave Enron a lot= of marketing firepower and put the company's name on the lips of millions = of Astros fans.=20 If Dynegy completes the acquisition of Enron Corp. as expected Dynegy also= may get the naming rights to the Astros' stadium.=20 With the name Enron fading in the merger it appears possible the 42000-= seat baseball stadium would take the Dynegy name.=20 If they do something with the company that name goes with it said Pam G= ardner president of business operations for the Houston Astros.=20 Dynegy Chairman Chuck Watson said Friday that no decision has been made abo= ut renaming the baseball stadium.=20 However Dynegy did register the domain name dynegyfield.com with Verisign= an Internet domain name registrar on Thursday.=20 Enron Field would not be the first sports facility to undergo a name change= .=20 The Compaq Center home of the Houston Rockets took the Compaq name in 199= 7 after being called The Summit for many years. And the name may be up in t= he air again as Compaq Computer Corp. contemplates a merger with Hewlett-Pa= ckard.=20 The stadium for the St. Louis Rams football team was renamed Dome at Americ= as Center after American Airlines bought former namesake TWA airlines.=20 It's not catastrophic if you have to change the name of the arena said D= ean Bonham of Bonham Group a sports marketing consulting firm.=20 Sometimes trying to change the name of a stadium can be hard said Kurt Hun= zeker editor of Team Marketing Report a sports business newsletter. The o= riginal name for a stadium can be adopted into fan's vocabulary and the se= condary names for stadiums don't always stick.=20 Many baseball fans in Cincinnati have had a hard time adjusting to calling = Riverfront Stadium by its new name of Cinergy Field Hunzeker said.=20 Sometimes the media refuse to cooperate with the name changes because of tr= adition or a simple refusal to give into commercialism. The Denver Post fo= r example has refused to adopt the new name of Invesco Field at Mile High = Stadium.=20 The deal for a new football stadium for the Houston Texans is similar to th= e arrangement with Enron Field said Steve Patterson senior vice president= of the Texans.=20 The Texans' field will be called Reliant Stadium. If Reliant Energy is boug= ht out by another company however the acquiring company will have the rig= ht to change the name of the stadium Patterson said. Photo: Enron Field seen on opening night in March 2000 could have a new n= ame next season (color)=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Market forces: Worries over Royal Bank's Enron exposure NEIL HUME 11/10/2001 The Guardian Copyright (C) 2001 The Guardian Source: World Reporter (TM) Executives at Royal Bank of Scotland are among those keeping their fingers = crossed that the urgent talks to save the debt-stricken energy trading grou= p Enron are successful.=20 In recent days it has emerged that Britain's second biggest bank by market = capitalisation is a lender to the US group. At the moment it is not clear how much money the Edinburgh bank has lent to= Enron and whether any of it is secured but speculation in the market plac= e suggests that the figure could run into millions. It seems RBoS was invol= ved in one of the credit facilities arranged for Enron which needs billion= s of dollars of new money to keep it afloat.=20 Royal Bank was yesterday keeping very quiet about the size of the exposure= but worries about the Enron situation were enough to push the shares down = 44p to pounds 16.70 on a bad day for the banking sector. Elsewhere Barclay= s fell 88p to pounds 21.12 HSBC lost 9.5p to 792.5p and Lloyds TSB dipped= 17.5p to 713p as investors decided it was time to take some profits.=20 On the other side of Atlantic Enron was locked in talks with rival Dynegy = over a $7bn (pounds 4.81bn) rescue takeover.=20 With Wall Street giving up strong gains overnight as investors decided to = book profits after the recent strong run London's top stocks started the d= ay on the back foot. Leading shares then trimmed a 50-point deficit as buye= rs emerged for heavyweight oil stocks Shell 6p higher at 514.5p and BP = 9p stronger at 565p after Saudi Arabia suggested the mood was shifting tow= ards a production cut of 1.5m barrels at next week's Opec meeting. News tha= t Russian oil companies are considering a cut also helped.=20 That was as good as it got. With Wall Street failing to provide a lead the= FTSE 100 drifted back eventually closing 33.9 points lower at 5244.2. Ho= wever dealers were not too downhearted by the performance pointing to the= index's 115-point advance over the week.=20 Cash rich Cable & Wireless took the FTSE 100's wooden spoon sliding 18.25p= to 330p with dealers attributing its weakness to the re-emergence of talk = that it is poised to make a big acquisition. Opinion was divided over the p= otential target. Most dealers plumped for Colt Telecom which has been lin= ked with C&W in recent weeks. Sure enough the shares responded ending the = day 10.5p better at 158p.=20 Others reckoned C&W had its eye on Energis and had approached 30% sharehold= er National Grid with a view to buying its stake. Whatever the truth of tha= t rumour analysts think Energis would be a better bolt-on acquisition for = C&W than Colt. Energis shares eased a penny to 89p.=20 Invensys the industrial controls group firmed 4.25p to 78.75p on hopes t= hat a positive outlook statement will accompany Thursday's interim results.= The figures will also provide analysts with their first chance to quiz new= chief executive Rick Haythornthwaite on his plans to turn around the heavi= ly indebted company.=20 Among the mid caps Carphone Warehouse underperformed falling 2.5p to 109p= as worries resurfaced about the demand for mobile phones in the Christmas= trading period .=20 Joint broker CSFB caused the trouble. With the outlook uncertain CSFB said = it had taken the precaution of lowering its pretax profits forecast to a w= orst case scenario pounds 55m. Its previous estimate was pounds 67.3m. CSF= B tried play down the significance of the downgrade arguing that Carphone = was likely to outperform its rivals in the next month but many traders int= erpreted it as an attempt to lower the City's expectations.=20 Furniture group MFI was heading in the other direction improving 10.5p to = 130p after house broker Deutsche Bank raised hopes that Wednesday's trading= update could impress. The German investment bank believes business has bee= n good at MFI in recent months and the company is on course to meet its pre= tax profit forecast of pounds 63.5m.=20 In an otherwise dull tech sector Autonomy the intelligent software group= advanced 14.75p to 313p. Traders heard talk that the company had secured a= couple of big contracts that were put on hold after September's terrorist = attacks.=20 There was also a flurry of interest in Debenhams the department store gro= up on speculation that the company will be tipped in a weekend newspaper. = The shares finished 23p higher at 395p.=20 In the smaller companies world retail investors were chasing Redbus Interh= ouse the web-hosting company run by John Porter the multi-millionaire Te= sco heir and son of Dame Shirley Porter.=20 Dealers said the investors were betting that Monday's third quarter figures= would top expectations. Given the over capacity in the web-hosting market = and the fact Redbus admitted with interim results in September that demand = had fallen most traders took the view that this was a bold and potentially= foolhardy gamble.=20 Elsewhere those retail investors suckered into Character Group the toy a= nd games maker when its shares hit 30p late on Thursday were nursing losse= s.=20 Before the market opened the company said that while one of its division p= roduced a range of Harry Potter gift products it was not an official Potter= licensee. Character which had almost doubled in the previous session she= d 6.75p to 24.25p.=20 There was also some pain for shareholders of Brammer the industrial servi= ces group which fell 61.5p to 256p after warning full-year pretax profits = would be 25% lower than last year.=20 Engineering group Senior gained 0.25p to 29.5p after a stock overhang was c= leared. Traders believe the shares could enjoy a good run next week especi= ally as bid rumours are floating around. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Business Dynegy snaps up Enron for $9.5bn Chris Ayres in New York 11/10/2001 The Times of London News International Final 5 60 (Copyright Times Newspapers Ltd 2001) Enron the troubled US energy company with close ties to President Bush wa= s yesterday bought for $9.5 billion (Pounds 6.5 billion) by its smaller riv= al Dynegy.=20 The move brings to a close one of the most spectacular Wall Street downfall= s of recent years. Shareholders in Enron who have seen more than $60 billi= on wiped off the value of the company this year will get about 0.27 of a D= ynegy share for every share they own in Enron valuing the deal at $10.41 p= er Enron share. The deal comes amid a Securities & Exchange Commission investigation into E= nron's controversial business practices. The struggling company also admitt= ed on Thursday that it had overstated its profits by nearly $586 million an= d understated its debt by $2.6 billion over the past four years.=20 As part of the deal ChevronTexaco which owns 27 per cent of Dynegy will = invest $2.5 billion in the merged company. Shares of Dynegy gained $2.26 to= close at $38.76. Enron shares rose 22 cents to $8.63. The announcement on = the merger of the two Houston-based companies came after the US markets clo= sed.=20 Before the deal was announced Enron saw its credit rating cut by Moody's t= o a notch above junk status. Meanwhile Enron's exit from a $2.9 billion = power plant project in India was blocked by the Bombay High Court.=20 Fears also heightened yesterday that US energy traders were beginning to by= pass Enron's Internet-based energy trading systems because of concern over = the company's ability to settle transactions and pay back collateral. So fa= r Enron's trading operations have remained immune from the disasters to hi= t the company on Wall Street.=20 The past few weeks have seen the departure of Enron's finance director And= rew Fastow and its treasurer Ben Glisan. The company's chief executive J= effrey Skilling resigned in August.=20 However some analysts expressed scepticism at the merger. Carole Coale an= analyst with Prudential Securities said she was puzzled as to why Dynegy= 's management would want to take on the uncertainties and potential liabili= ties associated with a merger with Enron.=20 Enron is America's biggest buyer and seller of natural gas and one of the c= ountry's ten largest companies with revenues last year of more than $100 bi= llion. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 UK jobs on the line 11/10/2001 Daily Mail Associated Newspapers Ltd. 1ST 81 (Copyright 2001) UP TO 4000 UK jobs are at risk as US energy group Enron seeks a 5.5bn resc= ue from rival Dynegy. Enron owns Wessex Water two power plants on Teeside = and runs the world's biggest energy-trading operation. Those are the jobs b= elieved to be most at risk.=20 US regulators are investigating off-balance sheet deals allegedly struck by= former finance director Andrew Fastow who has since left the company. Enron's managing director and chief counsel were sacked earlier this week f= or their roles in the affair. Enron took a 685m charge prompting a 90pc fa= ll in its share price. This week it restated four- year profits down by 22= pc to 405m.=20 Rating agency Moody's downgraded Enron's debt to its lowest investment grad= e warning another cut could follow. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Dynegy to get prime downtown real estate in Enron deal By PAM EASTON Associated Press Writer 11/10/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. HOUSTON (AP) - Enron Corp. Chairman Kenneth Lay envisioned the four trading= floors within his company's newly constructed silver glass tower - that wa= s to be its new world headquarters - as an energy trading center much like = the Chicago Mercantile Exchange.=20 They are pretty spectacular Enron spokeswoman Karen Denne said of the tr= ading floors following the announcement of Dynegy Inc.'s plans to buy Enron= for about $8 billion in stock late Friday. It is a huge state-of-the-art = trading floor. They are really neat. But the trading platforms likely won't be Enron's for long.=20 If the proposed deal between the two Houston-based energy trading companies= is approved the $200 million 40-story building will be among Dynegy's ne= w assets in the purchase of its much larger rival. The ornate building com= plete with metal sunshades and fins that deflect the sun and lower energy c= osts is scheduled for completion sometime next summer.=20 The last three weeks haven't been a whole lot of fun Lay said during a p= ress conference about the merger Friday at Dynegy's headquarters just a few= blocks away from where an oval shaped skybridge encircles Smith Street.=20 The enclosed air conditioned bridge connects what was to be Enron's new he= adquarters with its current building on the opposite side of the street.=20 Enron had long-term plans to complete its urban campus with a third tower a= fter building a second tower in 1999 the first major office building proje= ct in downtown Houston in more than a decade.=20 Lay and his former chief executive officer Jeff Skilling were to have sev= enth-floor offices overlooking the trading floors. Two curved grand stairwa= ys connect the offices to the floors below.=20 But Enron's future started changing shortly after Skilling's surprise resig= nation in August.=20 Last month Enron reported major losses in third quarter earnings. The compa= ny's stock then tumbled 80 percent in the past three weeks as investors gre= w increasingly concerned that serious financial problems were being hidden = from shareholders through business partnerships now under investigation by = the Securities and Exchange Commission.=20 A day after Lay expressed his confidence in his chief financial officer And= rew Fastow who managed those partnerships Fastow was ousted in an attempt= to regain investor confidence.=20 It didn't work and Skilling has since been called to testify before the SE= C about the partnerships.=20 Then Dynegy stepped in and one Houston company came to the rescue of anoth= er Prudential Securities Inc. analyst Carol Coale said.=20 Enron needed Dynegy. They needed a rescuer Coale said. The run on Enron= stock was similar to a run on a bank. Once things start to capitulate it c= an run right down into liquidity.=20 While Dynegy says its too early to discuss layoffs what happens to the nam= e of the Houston Astros' Enron Field or the future uses for Enron's buildin= gs University of Houston economist Barton Smith doubted the company will l= et the prime real estate go unused.=20 At one time Ken Lay and his family had a vision of Houston having an energ= y exchange and I think that vision is going to continue Smith said. This= brings Dynegy which was a relatively small player in as a pretty strong = force.=20 Smith said reductions in philanthropic giving are likely. Enron has contrib= uted to many Texas schools including the University of Houston Rice Unive= rsity the University of Texas and Southern Methodist University.=20 While the company's philanthropy has gained fans in Texas many in Californ= ia plagued by power shortages earlier this year still resent Enron for it= s outspoken support of deregulation.=20 The principles of karma seem to be working here said Harvey Rosenfield = founder of a California consumer advocacy group. Here Enron was one of the= chief proponents of deregulation and took advantage of it and benefitted e= normously and now is reaping the consequences.=20 Texas economists say ripple effects of the Dynegy-Enron merger on Houston's= economy will be minimal even if the combination forces layoffs.=20 There are some recessionary pressures going on in the United States but H= ouston is probably in a better position than any city I know of to dampen t= hose pressures said Mark Baxter director of the Maguire Energy Institute= at Southern Methodist University. The Houston market is unique in that as= pect.=20 But Michelle Michot Foss director of the Energy Institute at the Universit= y of Houston said the nation's fourth-largest city isn't immune to a weake= ning national economy.=20 We do have a three-pronged problem in town which is Continental Compaq a= nd Enron she said. But there is no way this is as bad as (the oil bust y= ears of) 1986 and 1987.=20 Houston-based Continental Airlines has cut 12000 jobs and reduced its flig= ht schedule in the wake of Sept. 11's attacks in New York Washington D.C. = and Pennsylvania. Meanwhile Hewlett-Packard is attempting to buy Compaq a= lso based in Houston which could result in additional layoffs from the com= puter maker.=20 The whole debacle with Enron has been very unfortunate Smith said. Enro= n in some ways was the icon of Houston with the merger of Compaq. Now it = looks as if it's going to be Dynegy.=20 ---=20 On the Net: Enron Corp.: http://www.enron.com.=20 Dynegy Inc.: http://dynegy.com. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Enron India Pwr Unit Sale Faces Review After Dynegy Deal 11/10/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) SINGAPORE -(Dow Jones)- The sale of Enron Corp's (ENE) 65% controlling equi= ty stake in the troubled Indian Dabhol Power Company will face a review i= f Dynegy Inc's (DYN) $8 billion rescue bid for Enron is approved by regulat= ors an Indian banking executive said Saturday.=20 The executives were attending talks held in Singapore to assesses potential= buyers for Enron's stake in DPC. Once this merger is through we will have to take a review of the entire m= atter P.P. Vora chairman and managing director of Industrial Development= Bank of India (P.IDB) told Dow Jones Newswires.=20 Vora didn't say whether Dynegy would retain or sell Enron's controlling sta= ke in the DPC if a merger was approved. He declined to comment on the speci= fics of the review.=20 Domestic Indian lenders have provided $1.4 billion of the project's total p= rojected cost of $2.9 billion. IDBI's exposure is in the excess of 20 billi= on rupees ($1=3DINR48.03) and the bank runs the risk of going deep into th= e red if the project goes bust.=20 The two-day closed door meeting in Singapore - originally scheduled to wrap= up Friday - ended inconclusively Saturday. Talks revolved around two poten= tial buyers of Enron's stake in the DPC Tata Power Co. Ltd. (P.TPW) and BS= ES Ltd. (P.BSX) - heavyweights in the Indian power sector.=20 Enron wants to sell its controlling equity stake in the $2.9 billion projec= t due to payment defaults by the plant's sole customer - the Maharashtra St= ate Electricity Board - and the Indian federal government's failure to hono= r payment guarantees.=20 A Bombay-based analyst with a leading Indian brokerage agreed that the issu= es surrounding the sale of Enron's stake in the DPC would have to reevaluat= ed from scratch.=20 Some post-takeover 'cleaning-up' in the merged entity will be expected. Dy= negy really need to see what their energy interests are and whether India w= ill figure in them the analyst said.=20 The analyst doubted Dynegy would take over Enron's stake in the DPC itself = in an attempt to revive it. Prima facie it appears unlikely. It (Dynegy) = has not really got into independent power projects outside the U.S. the a= nalyst said.=20 Indian media reports over the past two months have said Enron wants $1 bill= ion for its stake in Dabhol.=20 However commentators say Enron may have to sell at a discount given the co= mpany's deepening financial woes. A discounted sale would remain the case f= or Dynegy without a doubt post-takeover the analyst said.=20 DPC officials were unavailable for comment at the time of writing.=20 Indian banking executives remained tight-lipped on the outcome of the Singa= pore talks but described negotiations as very fruitful and successful.= =20 There was full cooperation from all sides. Certainly we have moved forwar= d but there's no decision (on a buyer for Enron's stake) as yet said IDB= I Executive Director A.K. Doda. I'm hopeful if we go through these routes = it'll lead somewhere.=20 The IDBI's Vora said all concerned parties had no immediate plans to hold= any further talks.=20 Asked whether Tata Power was the frontrunner as many analysts believe Dod= a said: That's their guess.=20 Analysts said Tata Power and BSES wouldn't necessarily be out of the runnin= g after the Dynegy-Enron merger. I think Dynegy will be relatively more wi= lling to diversify DPC and that wouldn't change the equation vis-a-vis Tata= and BSES he said. Overall it's positive.=20 Dabhol is India's largest single foreign investment. MSEB holds a 15% stake= while General Electric Co. (GE) and Bechtel (X.BTL) own 10% each.=20 DPC's domestic lenders include ICICI Ltd. (P.ICC) Industrial Development B= ank of India (P.IDB) IFCI Ltd. (P.ICI) and State Bank of India (P.SBI).=20 Loans by foreign lenders including ABN Amro Bank of America Corp. and Cit= igroup Inc. however are backed by government guarantees while domestic l= enders' loans are not.=20 -By Sri Jegarajah Dow Jones Newswires 65-415-4066 sri.jegarajah@dowjones= .com Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Talks to salvage multibillion dollar Enron India project goes into third da= y 11/10/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. SINGAPORE (AP) - Talks in Singapore to assess possible buyers for U.S.-base= d Enron Corp.'s controlling stake in the troubled Indian Dabhol Power Compa= ny have been extended into an unscheduled third day an Indian banking exec= utive involved in the negotiations said Saturday.=20 The two-day closed-door meeting - originally scheduled to wrap up Friday - = is focusing on two potential buyers of Houston-based Enron's 65 percent sta= ke in the power company. Tata Power Co. and BSES Ltd. - two of India's largest private power compani= es - are the only contenders vying to buy Enron's stake in Dabhol.=20 Talks will carry on today (Saturday) said A.K. Doda executive director = of the Industrial Development Bank of India. It's going to take a little m= ore time.=20 Senior Indian banking sources told Dow Jones Newswire that the talks are i= ntense but positive with negotiations continuing past midnight local t= ime.=20 Dabhol managing director K. Wade Cline officials from both prospective buy= ers and a consortium of Indian lenders to the Dabhol project are involved i= n the talks.=20 The Dabhol Power Company owns a 2184 megawatt power plant in the western I= ndian state of Maharashtra. The company is embroiled in a bitter power supp= ly dispute with the state government over allegedly unaffordable power ta= riffs.=20 Enron wants to sell its controlling equity stake in the dlrs 2.9 billion pr= oject due to payment defaults by the plant's sole customer - the Maharashtr= a State Electricity Board - and the Indian federal government's failure to = honor payment guarantees.=20 Dabhol is India's biggest-ever single foreign investment. The Maharashtra S= tate Electricity Board holds a 15 percent stake while General Electric Co.= and Bechtel Group Inc. own 10 percent each.=20 Domestic lenders have provided dlrs 1.4 billion of the project's total proj= ected cost of dlrs 2.9 billion.=20 Loans by foreign lenders including ABN Amro Bank of America Corp. and Cit= igroup Inc. are backed by government guarantees.=20 (dj/hp-ss) Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 All eyes in electric industry on Texas as deregulation nears By DAVID KOENIG AP Business Writer 11/10/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. DALLAS (AP) - Electric deregulation was a fabulous failure in California r= esulting in skyrocketing rates accusations of price-gouging and fears of w= idespread power blackouts.=20 The flop has made consumers elsewhere suspicious about giving up their regu= lated monopoly utilities for competition among power companies. Regulators and industry officials are turning their attention to Texas whe= re deregulation is scheduled to begin Jan. 1 after a rocky test program.=20 People are looking to Texas as the next iteration of retail competition. A= lot of states have pulled back after the California experience says Bret= t Perlman a member of the Public Utility Commission. If Texas is successf= ul Texas will become the model for the nation.=20 Ken Malloy president of a pro-deregulation think tank called the Center fo= r the Advancement of Energy Markets called Texas the state to watch.=20 California obviously created a domino effect leading other states to del= ay deregulation Malloy said. A lot of people are placing a lot of hope on= Texas.=20 Texas officials say that unlike California which must import much of its p= ower Texas imports little and has built more than 50 new power plants sinc= e 1995 providing an important cushion.=20 Texas also made it easier for power generators and resellers to negotiate l= ong-term contracts which officials say will help lock in lower prices. And= Texas provides more-digestible price information making it easier for con= sumers to comparison-shop they say.=20 California officials warn that Texans may be a little too smug.=20 They spot trouble already in Texas including California-style price spikes= in some spot markets for electricity - a clear sign they say that power = companies are learning how to maximize profits by forcing prices up.=20 There are things that can be done by people who own the power to create a = shortage and if they see an opportunity to make money doing that they will= said John Rozsa an aide to state Sen. Steve Peace who was heavily invo= lved in California's deregulation debate.=20 California officials accuse the power companies - many of them Texas-based = - of withholding supplies or clogging transmission lines to drive prices hi= gher. They say the same techniques could be used in Texas.=20 Supporters and opponents of deregulation do agree that the stakes will be h= igh in Texas for power companies and consumers.=20 If the wheels fall off it would be hard to put it back together says Bo= b Manning an executive with San Antonio-based H-E-B Grocery Co. which hop= es to cut its $40 million annual electricity bill through deregulation by a= t least 6 percent.=20 The idea behind electric deregulation is simple and powerful. Instead of fo= rcing residents and businesses to buy their power from a monopoly such as T= XU Electric or Reliant let them choose among several competing companies.= =20 In theory competition should cause prices to fall as it did for air trave= l and long-distance phone service. That's what the Texas Legislature though= t when it voted in 1999 to let utility customers pick a new power company b= eginning Jan. 1 2002.=20 Power traders led by Enron Corp. lobbied heavily for deregulation figuring= they could profit by gaining a chunk of the utilities' business even thoug= h Enron produces little power itself.=20 To prepare for deregulation the Legislature approved a seven-month pilot p= rogram in which a few commercial and residential customers would be able to= switch. Soon glaring problems emerged.=20 The trial program was delayed three times. When it finally began this summe= r the state's main power grid struggled to switch customers to their new p= ower company. Prices for backup power used on hot summer days temporarily j= umped 100-fold.=20 Through it all the Public Utility Commission and the power companies and t= heir allies have insisted the pilot program was serving its purpose of high= lighting potential problems.=20 Anytime you buy a new home there are a whole bunch of things you need to g= et fixed before you move in Perlman said this week. We're going down tha= t punch list and I think we'll be ready on Jan. 1.=20 The unresolved issues he said include how utilities such as TXU and Relia= nt will pass on the cost of fuel to their customers who were guaranteed a = 6 percent rate cut on Jan. 1.=20 In addition to the technical setbacks deregulation suffered a blow when Sh= ell Energy a unit of the Anglo-Dutch energy giant pulled out of Texas aft= er signing up 40000 customers. Suddenly one of the biggest players and a p= otent competitor to TXU and Reliant had vanished.=20 Shell has said that doing business in Texas became uneconomical after other= states delayed deregulation.=20 That was a bit bizarre because they had spent a lot of money to attract c= ustomers said Brian Lloyd a top PUC official on pricing issues. But if = they don't want to be here we don't want them.=20 Lloyd and other PUC officials are confident that as deregulation catches on= other power companies will move in to Texas ensuring strong competition.= =20 Already however deregulation will be delayed beyond Jan. 1 because of a l= ack of competition and questions about power-transmission in a section of s= outheast Texas served by Entergy Corp. and in a stretch of northeast Texas = served by Southwestern Electric Power Co.=20 Last month Consumers Union AARP and other groups asked the PUC to delay c= ompetition everywhere in Texas because of computer glitches and billing pro= blems during the pilot program.=20 Deregulation advocates worry that residential customers will simply stay wi= th their old electric utility causing new competitors to fail.=20 The PUC is likely to push ahead after receiving a final round of comments n= ext week from electric companies and officials of the main power grid call= ed the Electric Reliability Council of Texas or ERCOT.=20 Along with the power traders large commercial customers - like the H-E-B G= rocery chain - figure to be winners.=20 A grocery store is an energy hog Manning said. We have a lot of refrige= rators that run 24 hours a day 365 days a year. We help (the power compani= es') bottom line.=20 Perlman the PUC member predicted deregulation will start on time but said= that making it trouble-free was the most important goal to build consumer = confidence.=20 A year from now no one will remember whether the market opened on Jan. 1 = or Jan. 15 or March 15 he said.=20 End advance Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Enron Says It's Too Soon to Quantify U.K. Job Cuts (Update1) 2001-11-10 07:24 (New York) Enron Says It's Too Soon to Quantify U.K. Job Cuts (Update1) (Adds detail on U.K. operations Dynegy transaction lenders from fifth paragraph.) London Nov. 10 (Bloomberg) -- Dynegy Inc.'s $23 billion acquisition of Enron Corp. is at too early a stage for either company to know how many U.K. jobs will be eliminated an Enron spokesman said after a newspaper reported 4000 are at risk. Dynegy's acquisition of the biggest energy trader announced yesterday ``is still a long way off from closing'' said Enron spokesman Alex Parsons. ``It's too early to know what the impact will be on U.K. jobs'' he said. The Daily Mail newspaper which didn't cite sources said today that 4000 jobs are at risk mainly at Enron's Wessex water unit in southwest England two power plants on Teeside in northeast England and at its energy trading operation. It employs 5400 people in Europe mostly in the U.K. said Parsons. Dynegy said yesterday it would save as much as $500 million a year by ``winding down'' Enron's business outside of trading and pipelines and cutting costs. Enron decided to sell after its shares plunged 90 percent this year amid investors' concerns about the accuracy of its financial statements. The company had said in October it planned to eliminate as many as 500 jobs in Europe or almost as much as 10 percent of the workforce there to reduce costs. Offset Risk The company which owns generation in the U.K. to offset risk in its power trading operations said in August two workers died and two others were seriously injured in an explosion and fire at Teeside power station which it operates and partly owns. Enron owns Wessex Water as part of its Azurix water unit. It spent $2.8 billion in 1998 for Wessex from which Azurix emerged. Enron sold Azurix shares to the public in 1999 and then bought back the company this year after the unit failed in its strategy of buying up water companies and winning large projects. In August Enron agreed to sell Azurix's North American business to American Water Works Inc. for $150 million. The Dynegy transaction is expected to close in 2002's third quarter. The new company will have $90 billion in assets Dynegy said. Dynegy's stockholders including ChevronTexaco will have 64 percent of the new company. Enron's holders will own the rest. The merger will face opposition from consumer groups especially in California where energy traders such as Dynegy and Enron were blamed for soaring electricity prices that left the state's biggest utility bankrupt and the second-largest fighting for a government bailout. Other companies may yet be caught in the fallout from Enron's situation. Royal Bank of Scotland Group Plc is a lender to Enron the Guardian newspaper reported today without citing sources. It's unclear how much the U.K.'s No. 3 bank by assets lent Enron though it may be as high as several million pounds the paper said. It's not clear if the loans are secured it said. Royal Bank was involved in setting up a credit facility for Enron the newspaper said adding this helped push down the company's share price by 2.6 percent yesterday. --Mathieu Robbins in the London newsroom (+44 20) 7673 2097 Dynegy to Buy Enron for $23 Billion in Stock Debt (Update9) 2001-11-09 23:23 (New York) Dynegy to Buy Enron for $23 Billion in Stock Debt (Update9) (Adds advisers in last paragraph.) Houston Nov. 9 (Bloomberg) -- Dynegy Inc. agreed to buy Enron Corp. for at least $23 billion in stock and assumed debt ending a financial crisis that threatened to bankrupt Enron and disrupt U.S. power and natural-gas markets. Investors will get 0.2685 of a Dynegy share for each Enron share or $10.41 based on Dynegy's closing price today. The stock portion of the transaction is valued at $8 billion to $9 billion Dynegy Chief Financial Officer Robert Doty said. Dynegy said it will assume about $15 billion in Enron debt. Enron the largest energy trader decided to sell after its shares plunged 90 percent this year and a federal investigation of accounting irregularities limited its ability to finance operations. Enron's collapse would have caused upheaval in energy markets where the company does one-quarter of all gas and power trades traders say. ``Without someone stepping in to play the role Enron plays people (would) have a difficult time executing transactions'' said Daniel Gordon president of Allegheny Energy Inc.'s trading unit. ChevronTexaco Corp. the second-biggest U.S. oil company and owner of 26 percent of Dynegy will provide Enron with $1.5 billion immediately. ChevronTexaco will give Dynegy $1 billion after the merger closes. Dynegy Chief Executive Officer Charles Watson who led a company that has put as much emphasis on building power plants as on energy trading will take over a larger rival that Chairman and CEO Kenneth Lay had focused on trading. Earnings Reduced Lay's strategy boosted Enron's reported revenue to $100.7 billion in 2000 almost four times Dynegy's and more than 20 times what Enron generated in 1995. At its peak in December 2000 Enron stock was valued at more than $69 billion. In recent months Enron shares plummeted as investors began to question the accuracy of Enron's financial statements saying it was unclear whether the company was using affiliated partnerships to move debt off its books and hide losses. Yesterday the company restated its earnings for the past four years lowering them by more than $500 million to include losses from partnerships it once kept off its books. After the merger announcement Standard & Poor's Investors Service said it may lower Dynegy's debt rating. It cut Enron's to ``BBB-'' one notch above junk. Watson Dynegy President Stephen Bergstrom and CFO Doty will keep their positions at the combined company. Greg Whalley the president and chief operating officer of Enron will be an executive vice president. Lay said he won't be an active manager in the new company. Lay has not discussed a severance package with him Watson said. $200 Billion in Revenue Dynegy said it will have annual revenue of more than $200 billion more than 22000 megawatts of electric generating capacity and 25000 miles of pipeline after the merger. The company will save as much as $500 million a year by ``winding down'' Enron's business outside of trading and pipelines and cutting costs Dynegy said. The announcement of the merger came after the close of stock market trading though the two companies had acknowledged they were in talks. Shares of Dynegy rose $2.26 or 6 percent to $38.76. Enron rose 22 cents to $8.63. ChevronTexaco rose $1.90 to $89.49. Enron's 6.4 percent bonds which mature in 2006 jumped to about 76 cents on the dollar up from 69 cents traders said. The combination is expected to be ``strongly accretive'' to earnings Dynegy said. It projected earnings of $3.40 to $3.50 a share next year. It had been expected to earn $2.57 the average estimate of analysts surveyed by Thomson Financial/First Call. Third Quarter Closing The transaction is expected to close in 2002's third quarter. The new company will have $90 billion in assets Dynegy said. Dynegy's stockholders including ChevronTexaco will have 64 percent of the new company. Enron's holders will own the rest. ``Dynegy is taking out a competitor acquiring some attractive assets and they're doing it at an incredible price'' said Joseph Correnti an analyst at Wayne Hummer Investments who doesn't own shares of either company. Enron will pay a $350 million breakup fee if the transaction collapses. The two Houston-based companies began negotiations a week ago as it became apparent that Enron needed cash to stay in business. Watson said he approached Lay. ``I simply called Ken to see if there was anything we could do to straighten'' out rumors of a cash crunch at Enron Watson said. ``That next Saturday Ken was gracious enough to invite me over to his home.'' Dynegy agreed to the terms after Moody's Investors Service maintained an investment grade rating on Enron today eliminating a stumbling block in negotiations. Cash Crunch Moody's announcement removed the threat that a junk rating would force Enron to repay early $3.3 billion in bonds. Enron has been battling a cash crunch and a loss of investor confidence because of questions about partnerships started by its senior executives. Enron fired Chief Financial Officer Andrew Fastow in October as a Securities and Exchange Commission investigation focused in on partnerships he headed and helped create. Enron estimated Fastow made $30 million through partnerships affiliated with the company. The SEC began the investigation after Enron reduced third- quarter earnings by more than $1 billion and said dealings with two partnerships had lowered shareholder equity by $1.2 billion. ``Clearly (the partnerships) created quite a perception problem for the company and maybe more serious problems than that'' Lay said on a conference call after the buyout announcement. ``We'll see over time.'' California Opposition The merger will face opposition from consumer groups especially in California where energy traders such as Dynegy and Enron were blamed for soaring electricity prices that left the state's biggest utility bankrupt and the second-largest fighting for a government bailout. ``We will petition the state attorney general and federal authorities to block this merger'' said Doug Heller of the California-based Foundation for Taxpayer and Consumer Rights. ``This would further tighten the grip that the unregulated power industry has over California and it's the grip of the energy cartel that has choked California for the last year and a half.'' Energy trading markets ``are relatively fragmented'' so there should be no antitrust problems even though Enron and Dynegy are big companies said Robert Burka a Washington-based antitrust attorney with Foley & Lardner. ``Enron may well not be a healthy company going forward'' if the merger isn't approved Burka said. EnronOnline The combination of the two companies will leave Watson with control of EnronOnline an Internet energy and commodities trading site that has done more than $880 billion in trades since it was created in November 1999. ``It's not perfectly capturing the value of Enron but if you're on the board at Enron at this point you take it and move on'' said Correnti of Wayne Hummer Investments. The total value of the stock portion of the transaction could rise depending how many Enron shares need to be converted in the stock swap. An Enron spokesman said the company had 913 million shares on a fully diluted basis though a person familiar with the talks said Enron's stock price is so low that many common share equivalents won't be converted leaving the number at 743 million shares. Lehman Brothers Inc. is Dynegy's financial adviser on the transaction. Salomon Smith Barney Inc. and J.P. Morgan & Co. are advising Enron. --Margot Habiby in Houston (713) 353-4872 Dynegy announces $8 billion deal to buy larger rival Enron By JUAN A. LOZANO Associated Press Writer 11/09/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. HOUSTON (AP) - Energy marketer Dynegy Inc. announced Friday that it will bu= y its much larger rival the once mighty but now troubled Enron Corp. for = $8 billion in stock. Dynegy also will assume a hefty $15 billion in Enron d= ebt.=20 The announcement came after Enron's stock price plummeted about 80 percent = over the past three weeks because of concerns that the company wasn't revea= ling serious financial problems to shareholders. Under the deal ChevronTexaco Corp. which owns more than a quarter of Dyne= gy would quickly provide about $1.5 billion. ChevronTexaco also would cont= ribute an additional $1 billion upon completion of the deal the companies = said.=20 With its market-making capabilities earnings power and proven strategic a= pproach to wholesale markets Enron is the ideal strategic partner for Dyne= gy Dynegy chairman and chief executive officer Chuck Watson said in annou= ncing the purchase.=20 Watson made it clear that he would not tolerate the sort of financial pract= ices that prompted explosive disclosures by Enron this week - including an = admission that more than half a billion dollars in debt had been kept off t= he company's books.=20 As a combined company we will focus on leveraging our core skill sets and= as always we will keep a strong balance sheet and straightforward financ= ial structure as key priorities Watson said.=20 Enron is the country's top buyer and seller of natural gas and the No. 1 w= holesale power marketer. The company operates a 25000-mile gas pipeline sy= stem and also markets and trades metals paper coal chemicals and fiber= -optic bandwidth.=20 Dynegy controls nearly 15000 megawatts of power generating capacity throug= h investments in power projects and sells the energy in wholesale markets = and through utilities.=20 At a news conference Watson said company officials who negotiated the deal= came away convinced that Enron was worth buying despite its recent trouble= s.=20 We looked under the hood and guess what it's just as strong as we though= t it was Watson said.=20 Under the terms of the deal Enron shareholders will receive .2685 Dynegy s= hare for each share of Enron common stock valuing each Enron share at $10.= 41. Enron has about 775 million common shares said spokeswoman Karen Denne= .=20 That represents a 21 percent premium above Enron's closing price of $8.63 F= riday on the New York Stock Exchange - but still just a fraction of their 5= 2-week high of $84.87. Dynegy's shares climbed $2.26 or 6 percent to clos= e at $38.76 on the NYSE.=20 In after hours trading on the NYSE Enron shares shot up 15.6 percent or $= 1.35 to $9.98. Dynegy shares were unchanged.=20 Dynegy's stockholders will own approximately 64 percent of the new company= with Enron's stockholders holding the remainder.=20 The boards of both companies have unanimously approved the transaction whi= ch is expected to close next summer. The deal is expected to save the combi= ned company between $400 and $500 million annually because of continued eli= mination of non-core Enron holdings and lower operating costs. Watson sai= d it was too soon to say if the deal would result in job cuts. Enron has ab= out 20000 employees while Dynegy's work force is about 6000.=20 Watson will remain as chairman and chief executive of the combined company= which will retain the Dynegy Inc. name. Dynegy's Steve Bergstrom will cont= inue as president.=20 Enron chairman and chief executive Kenneth L. Lay will no longer have a rol= e in day-to-day management of the company but has been offered a seat on t= he combined company's board and will help shepherd the merger through.=20 Dynegy said that Greg Whalley the current president and chief operating of= ficer of Enron will become an executive vice president of the new Dynegy. = He said the merger sets the best course for Enron.=20 Few of the options we considered for our core business going forward provi= ded us with the earning potential and immediate synergies that a merger wit= h Dynegy could deliver Whalley said. Together with Enron's recently anno= unced bank commitments this cash infusion gives Enron immediate liquidity= which we believe will enable the company to maintain its investment grade = credit rating.=20 The merger was announced a day after Enron acknowledged it overstated earni= ngs by about 20 percent over the past four years and kept large amounts of = debt off its balance sheets through business partnerships now under investi= gation by the Securities and Exchange Commission.=20 Analysts said the merger rescues Enron but leaves Dynegy in uncharted terr= itory - with the outcome of the SEC investigation completely unknown. Ther= e is still a shroud hanging over Enron that now moves over to Dynegy said= Carol Coale an analyst with Prudential Securities.=20 Early Friday Moody's Investors Service downgraded Enron's debt ratings to = one level above junk bond status and said the company's long-term debt rati= ngs remain under review for further downgrade.=20 In an SEC filing Enron said financial statements from 1997 through the fir= st half of 2001 should not be relied upon and that outside businesses run= by Enron officials during that period should have been included in the com= pany's earnings reports.=20 The revised statements reduced Enron's profits for those years by $586 mill= ion from $2.89 billion to $2.31 billion. The revisions also increased the = company's debt each of the four years reaching $10.86 billion - $628 milli= on more than previously reported - by the end of 2000.=20 Keeping the debt off its balance sheets likely ensured Enron could maintain= a strong credit rating to support expansion of its core businesses - whole= sale trading of natural gas and electricity.=20 But the company's stock price started dropping 10 months ago when its high-= speed Internet unit foundered and Enron had trouble collecting money from p= ower customers in India.=20 The stock price began to free fall after Enron announced a $618 million thi= rd quarter loss and news of the SEC investigation surfaced.=20 Enron responded by firing its chief financial officer and scrambled to get = cash and increase credit lines in an attempt to regain investor confidence= but investors dumped Enron shares and sent its stock plummeting.=20 The ousted chief financial officer Andrew Fastow ran some of the partners= hips under investigation by the SEC.=20 Jeff Skilling Enron's former chief executive who left in August has been = called to testify before the SEC although it's unclear when.=20 ---=20 On the Net:=20 http://www.enron.com=20 http://www.dynegy.com AP Graphic DYNEGY ENRON=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 USA: UPDATE 3-Dynegy to acquire Enron for $9 bln. 11/09/2001 Reuters English News Service (C) Reuters Limited 2001. (Adds new material from news conference new analyst comments)=20 By Andrew Kelly HOUSTON Nov. 9 (Reuters) - Dynegy Inc. agreed on Friday to acquire rival E= nron Corp. for some $9 billion in stock underlining the dramatic reversal = of fortunes for the Houston-based energy trading giant that was valued last= year at nearly $80 billion.=20 Enron's stock fell sharply in the past month due to investors' concerns abo= ut murky transactions that sparked an investigation by U.S. regulators and = damaging downgrades by credit rating agencies.=20 It's an unbelievable ending to an unbelievable story said Fulcrum Global= Partners analyst Michael Barbis. The company that created the industry is= gone - it's all Dynegy now.=20 The merged company will retain the Dynegy name. It will have annual revenue= s of more than $200 billion and assets worth $90 billion including more th= an 22000 megawatts of electricity generating capacity and 25000 miles of = natural gas pipelines.=20 It will be North America's biggest marketer and trader of natural gas and e= lectricity positions previously held by Enron.=20 Dynegy will control the new 14-member board holding 11 of its seats and t= he top executive positions.=20 ChevronTexaco Corp. a 26.5 percent stakeholder in Dynegy will provide an= immediate infusion of $1.5 billion to keep Enron's core trading operations= afloat and a further $1 billion when the deal closes. It will get three bo= ard seats.=20 DYNEGY'S WATSON FIRMLY IN CONTROL=20 The deal puts Chuck Watson Dynegy's pioneering chairman and chief executiv= e who has long labored under Enron's shadow firmly in charge of the new co= mpany.=20 It is a great deal for Dynegy and under the circumstances as a good of a= deal as Enron could get said UBS Warburg analyst Ron Barone.=20 Watson will remain chairman and chief executive of the merged company whil= e Dynegy's president Steve Bergstrom and chief financial officer Rob Dot= y will retain those positions.=20 Greg Whalley president and chief operating officer of Enron will become a= n executive vice president and will join Watson Bergstrom and Doty in the = Office of the Chairman.=20 Barbis said that after Enron saw its stock fall 75 percent over the last mo= nth cutting its market capitalization by $19 billion the company was left= in a weak negotiating position. At the end of the day they had no choice= he said.=20 Dynegy will swap 0.2685 shares of its own stock for each Enron share valui= ng Houston-based Enron at $10.41 per share a premium of 21 percent over Fr= iday's closing price of $8.63.=20 The price is far below a lofty high of $90.56 set on Aug. 23 2000 when En= ron was riding a wave of investor enthusiasm.=20 Dynegy stockholders will own about 64 percent and Enron stockholders will o= wn about 36 percent of the merged company.=20 REGULATORS PROBE ENRON DEALS=20 Enron had been struggling to overcome a plummeting stock price and credit r= atings in the past month following disclosures of off-balance sheet deals n= ow under investigation by the U.S. Securities and Exchange Commission.=20 Enron chairman and chief executive Ken Lay told a news conference in Housto= n that he would have preferred Enron to retain its independence but that th= is had become impossible in the face of a consistent barrage of really neg= ative articles.=20 The last three weeks haven't been a whole lot of fun said Lay adding th= at he had not yet decided whether to take up Watson's offer of a seat on th= e merged company's board.=20 Watson said the agreement with Enron includes escape clauses that would a= llow Dynegy to back out of the deal if any further undisclosed problems wer= e to emerge but he said he was confident that this would not happen.=20 You know we looked under the hood and guess what? It's just as strong as = we though it was he said.=20 Watson said he did not expect the merger to run into serious regulatory obs= tacles.=20 Regulatory agencies realize that a speedy resolution is important to keep = stability in the U.S. energy market. This has got to be resolved said UBS= Warburg analyst Barone.=20 Dynegy said it expects the new company to earn $3.40 to $3.50 per share in = 2002 an increase of 35 percent or 90 cents to 95 cents per share for cur= rent Dynegy shareholders before taking into account expected synergies and= cost savings.=20 Dynegy estimates annual pretax savings of $400 million to $500 million as a= result of the sale or winding down of non-core businesses in the Enron por= tfolio and other measures.=20 Watson said he did not yet know how many jobs might be cut as a result of c= ombining the two companies.=20 The merger still requires approval by regulators and both sets of sharehold= ers but is expected to close by the end of the third quarter of 2002.=20 Lehman Brothers was financial advisor to Dynegy. J.P. Morgan Chase and Salo= mon Smith Barney a unit of Citigroup were financial advisors to Enron. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Enron not California's largest power supplier but merger could affect pric= es By KAREN GAUDETTE Associated Press Writer 11/09/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. SAN FRANCISCO (AP) - When Houston-based Dynegy Inc. announced Friday that i= t had bought Enron its larger rival for $7.8 billion shares of stock some= energy traders predicted fluctuating power prices in the coming months thr= oughout the West as the market settles into a new hierarchy with one fewer = provider.=20 The fragility of the system is such that a small perturbation can turn eve= rything upside down very easily said Gary Ackerman executive director of= the Western Power Trading Forum of which Enron is a member. A week ago I= don't think many people would have even contemplated this. The loss of Houston-based Enron will make prices more jumpy and more uncer= tain and it's going to take the market some time to calm down Ackerman sa= id. Should the Northwest have a chilly winter prices could spike with fewe= r sellers in the market he said.=20 And that in turn could affect California's pocketbook though the state buy= s a negligible amount of electricity from Enron said Oscar Hidalgo spokes= man for the state Department of Water Resources which buys electricity for= the customers of two financially ailing utilities. Hidalgo said the state = had a long-term contract with Enron earlier this year though the marketer o= pted out of it after a month.=20 They have indicated to us that we were somewhat of a credit risk for them= like many generators at the time Hidalgo said.=20 Earlier this year Enron attempted to cancel its contract as electricity an= d natural gas provider to California's two public university systems which= spent more than $170 million combined last year on the fuels. It was uncle= ar Friday what would happen to those contracts.=20 Enron's reach in California goes beyond keeping the lights on.=20 The state's retirement pension fund owns 3 million shares of Enron stock - = about 1 percent of its total investments - said CalPERS spokeswoman Pat Mac= ht. The CalPERS board will meet next week to discuss the situation she sai= d.=20 I can only say at this point that we were as surprised and shocked as the = rest of the world was about what has been going on there and we're assessin= g our options Macht said.=20 Enron Corp.'s outspoken support for deregulation of the country's electrici= ty markets sparked resentment in California as rolling blackouts swept thro= ugh earlier this year although the energy marketer is not one of Californi= a's largest power providers.=20 Some felt the financial downfall of the nation's top buyer and seller of na= tural gas and major electricity seller was justified.=20 The principles of karma seem to be working here said Harvey Rosenfield = founder of the Santa Monica Calif.-based consumer advocacy group the Found= ation for Taxpayer and Consumer Rights. Here Enron was one of the chief pr= oponents of deregulation and took advantage of it and benefitted enormously= and now is reaping the consequences.=20 Earlier this year California Attorney General Bill Lockyer subpoenaed Enro= n's electricity trading records as he sought to prove the state was the vic= tim of price gouging which led officials to spend more than $9 billion buyi= ng electricity for the customers of two financially troubled utilities. Enr= on repeatedly denied all accusations of market manipulation.=20 Enron the nation's top buyer and seller of natural gas and the top wholesa= le marketer in the United States had become one of the nation's 10 largest= companies recording revenue of $100.8 billion in 2000. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Dynegy-Enron merger could mean name change for Enron Field By KRISTEN HAYS Associated Press Writer 11/09/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. HOUSTON (AP) - The Houston Astros' stadium won't be nicknamed Home Run Fie= ld much longer.=20 Houston-based energy marketer Dynegy Inc. announced Friday that it will buy= Enron Corp. the $100 million namesake of the Astros' ballpark. The compan= ies will operate independently until the deal closes possibly next summer. The new company will keep Dynegy's name and lose Enron's - and Houston's $2= 51 million ballpark could see the same change Astros owner Drayton McLane = Jr. said.=20 McLane said the team's 30-year naming rights agreement with Enron allows an= other company to give the ballpark a new name in case of a merger. The Astr= os have the right to approve or reject a change.=20 We want to work with (Dynegy chairman and chief executive) Chuck Watson an= d we look forward to working with Dynegy McLane said.=20 Watson said the ballpark name wasn't an issue as the companies hammered out= the merger agreement this week.=20 Quite honestly it has not come up Watson said Friday. This is about tw= o strong companies going forward. It is something we will have to deal with= in the months coming up.=20 Since opening before the 2000 season Enron Field has become known as one o= f the best parks for hitters in the majors. There have been 496 homers hit = in Enron the past two years 19 percent more than in Astros road games.=20 Coincidentally Houston's other company-named sports facility also is in qu= estion. The corporate namesake of the Compaq Center basketball/hockey arena= Compaq Computer Corp. is being bought by Hewlett-Packard Co.=20 Enron Field wouldn't be the first venue to change names because of a merger= or other corporate decision by the naming-rights owner.=20 CoreStates Arena home to the Philadelphia 76ers and the Philadelphia Flyer= s became First Union Arena when First Union Corp. acquired CoreStates Fina= ncial Corp. in 1998.=20 Marine Midland Arena in Buffalo N.Y. became HSBC Arena last year because = Marine Midland in 1999 changed its name to HSBC Bank USA as part of a globa= l branding strategy.=20 Such changes are inevitable when 61 major league sports facilities bear cor= porate names in an age of many mergers and acquisitions said Dean Bonham o= f the Bonham Group in Denver a sports and entertainment marketing firm.=20 Mergers and acquisitions had no effect on the sports industry just 10 year= s ago he said. Today they can have a significant affect on the community= beyond the direct impact on the company itself.=20 Enron chairman and chief executive Ken Lay who said Friday he had been inv= ited to serve on the new company's board of directors helped create Enron = Field before buying its name.=20 By 1996 McLane had determined it was time to move from the once-futuristic = though aging Astrodome and threatened to sell part of the team and move to= Virginia unless a new ballpark was built in Houston.=20 That year Lay put together a consortium that provided a $34.7 million no-in= terest loan to buy the land in downtown Houston and subsidize the 42000-se= at ballpark's construction costs.=20 Enron also manages the ballpark's mechanical and electrical equipment and e= nergy services which officials said would earn up to $200 million over 30 y= ears. McLane said Dynegy likely would continue that deal. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Dynegy Buy Of Enron Valued At $23B-$24B With Debt By Michael Rieke and Erwin Seba Of DOW JONES NEWSWIRES 11/09/2001 Dow Jones News Service (Copyright (c) 2001 Dow Jones & Company Inc.) HOUSTON -(Dow Jones)- Asked what kind of bargain Dynegy Inc. (DYN) got in b= uying Enron Corp. (ENE) Enron Chairman and Chief Executive Ken Lay said to= ld a Friday evening press conference A big one.=20 Dynegy will convert 850 million shares of Enron stock to its own shares in = a deal valued at $23 billion-$24 billion with assumption of debt. Dynegy Chairman Chuck Watson told the media that the deal wasn't something = that was stitched together in the last two weeks.=20 Watson had called Lay on Oct. 24 to tell him that Dynegy didn't have any qu= alms about being a counterparty in energy deals with Enron and to ask if th= ere was anything Dynegy could do to help.=20 At the time Enron's share price was under pressure due transactions it had= done with its former chief financial officer Andrew Fastow. The company ha= d just taken a $1.2 billion reduction in shareholder equity when it closed = out transactions and the Securities and Exchange Commission had just launch= ed an investigation of the deals.=20 The next Saturday Lay invited Watson to his home and they started discussin= g a merger Watson said.=20 Three or four weeks ago he didn't expect such a transaction to occur Lay s= aid. But he began to realize that Enron needed to strengthen its balance sh= eet quickly improve liquidity and focus on its core businesses.=20 Enron was in control of its destiny until the merger was done Lay said. En= ron could have stayed independent and revitalized the balance sheet with pr= ivate investments but Dynegy was showing interest in a merger.=20 As we looked at the alternatives it fairly quickly became apparent to us = to do this deal with Dynegy was the best option he said.=20 Enron looked at the shareholder lawsuits filed against the company and at t= he exposure from the SEC investigation he said. It then determined a worst= -case scenario which was then built into the economics of the deal.=20 Neither Watson nor Lay wanted to get into specifics involving the transacti= ons Enron done with the partnerships run by Fastow. Enron will discuss thos= e deals more thoroughly in a conference call in the middle of next week.=20 In explaining his company's demise Lay blamed a series of negative news st= ories combined with management's ignorance of the facts concerning the par= tnership transactions.=20 You can always second-guess everything but it has been a fairly consisten= t barrage of really negative articles that's been very tough to beat...back= he said.=20 Due diligence for the deal was relatively easy to do because the two compan= ies already knew each other so well said Watson. The two Houston-based com= panies have been competing in the energy business for about 15 years.=20 After examining Enron's books and businesses it became clear the value de= gradation in Enron had nothing to do with the core businesses said Watson= .=20 Watson said it is too soon to think about the possibility of layoffs result= ing from the merger. Enron has more than 7000 employees in Houston compare= d with 1600 Dynegy employees. Worldwide Enron has 20000 employees and Dyn= egy has 6000 employees.=20 Watson has asked Lay to join Dynegy's board of directors. Lay said he would= decide whether to accept that spot as the deal gets close to closing.=20 Watson doesn't expect any regulatory problems associated with the merger. T= he deal must be approved by regulators in the U.S. and in Europe where bot= h companies have operations. Regulatory approval should take six to nine mo= nths.=20 There is an escape clause in the merger deal. Dynegy will get $350 million = if the deal falls apart.=20 Although the combined companies will be a huge player in the energy busines= s Watson doesn't expect regulators to require any sale of assets.=20 Enron will go ahead with its plans to sell $4 billion in assets. It has a d= eal to sell its electric utility Portland General Electric for $3 billion= including assumption of debt. The deal with Northwest Natural Gas Co. (NWN= ) will include $1.55 billion in cash $200 million in Northwest Natural pre= ferred stock and $50 million in common stock.=20 Enron is also planning to sell another $850 million-$900 million in foreign= assets.=20 Each company will continue to operate its own electronic energy trading pla= tform. Enron operates EnronOnline and Dynegy operates DynegyDirect.=20 EnronOnline is the most successful online business doing $3 billion-$4 bil= lion a day in energy transactions in the last 30 days.=20 Dynegy started its online trading platform last year. It did $10 billion of= business in the third quarter of this year.=20 This is a financial bonanza for both companies Watson said. This is goo= d for Dynegy. This is good for Enron. It's also good for our employees and = it's good for our stockholders.=20 -By Michael Rieke Dow Jones Newswires 713-547-9207 michael.rieke@wsj.com= and Erwin Seba 713-547-9214 erwin.seba@dowjones.com Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Chronology of Enron Corp.'s history 11/09/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. HOUSTON (AP) - A look at the history of Enron Corp.:=20 July 1985 - Houston Natural Gas merges with InterNorth a natural gas compa= ny based in Omaha Neb. to form the modern-day Enron an interstate and in= trastate natural gas pipeline company with approximately 37000 miles of pi= pe. 1989 - Enron begins trading natural gas commodities. Over the years the co= mpany becomes the largest natural gas merchant in North America and the Uni= ted Kingdom.=20 June 1994 - Enron North America trades its first electron. Enron goes on to= become the largest marketer of electricity in the U.S.=20 January 1997 - Enron unveils a new logo and its first global advertising ca= mpaign. The company also acquires Zond Corp. a leading developer of wind e= nergy power. The acquisition results in the formation of Enron Renewable En= ergy Corp.=20 August 1997 - Enron announces its first commodity transaction using weather= derivative products. Enron goes on to market coal pulp paper plastics = metals and bandwidth.=20 April 1999 - Enron agrees to pay $100 million over 30 years for the naming = rights to Houston's new ballpark Enron Field. The Astros also sign a 30-ye= ar facilities management contract Enron Energy Services.=20 June 1999 - Enron Energy Services transacts its first billion-dollar deal w= ith Suiza Foods.=20 November 1999 - Enron launches EnronOnline the first global Web-based comm= odity trading site.=20 January 2000 - In a Fortune survey Enron was named The Most Innovative Co= mpany in America for the fifth consecutive year and is ranked No. 24 among= the 100 Best Companies to Work for in America.=20 March 2000 - The Energy Financial Group ranks Enron the 6th largest energy = company in the world.=20 May 2000 - Enron and strategic investors IBM and America Online launch Th= e New Power Company the first national energy service provider for residen= tial and small businesses in deregulated U.S. energy markets.=20 August 2001 - Enron chief executive officer Jeff Skilling resigns after run= ning the company for just six months. Chairman and former CEO Ken Lay resum= es his position atop Enron.=20 October 16 2001 - Enron reports a $638 million third-quarter loss and disc= loses a $1.2 billion reduction in shareholder equity partly related to par= tnerships run by chief financial officer Andrew Fastow.=20 Oct. 22 2001 - Enron acknowledges Securities and Exchange Commission inqui= ry into a possible conflict of interest related to the company's dealings w= ith those partnerships.=20 Oct. 24 2001 - Enron ousts Fastow.=20 Oct. 27 2001 - Enron taps into more than $3 billion in credit in an effort= to boost confidence of investors and customers.=20 Oct. 31 2001 - Enron announces the SEC inquiry has been upgraded to a form= al investigation. Enron creates special committee headed by University of T= exas law school dean William Powers to respond to the investigation.=20 Nov. 1 2001 - Enron secures $1 billion in new financing using its natural= gas and pipeline assets as collateral.=20 Nov. 6 2001 - Enron's stock price drops below $10 a share - down from a 52= -week high of $84.87 on Dec. 28 2000 - after reports the financially troub= led energy trader was seeking additional financing to shore up confidence.= =20 Nov. 8 2001 - Enron files documents with SEC revising its financial statem= ents for past five years to account for $586 million in losses.=20 Nov. 9 2001 - Dynegy Inc. announces an agreement to buy its much larger ri= val Enron for $7.8 billion in stock. Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 Fitch Takes Rating Action on Enron & Dynegy on Merger News 11/09/2001 Business Wire (Copyright (c) 2001 Business Wire) NEW YORK--(BUSINESS WIRE)--Nov. 9 2001--Fitch revises the Rating Watch on = Enron Corp.'s outstanding securities to Evolving from Negative where they w= ere placed on Oct. 25 2001.=20 A Rating Watch Evolving means the ratings may be raised lowered or mainta= ined. In addition the long-term credit ratings of Dynegy Inc. (DYN) and Dy= negy Holdings Inc. (DYNH) are placed on Rating Watch Negative. A Rating Wat= ch Negative means that the ratings may be lowered or affirmed. The outstand= ing `F2' rated commercial paper programs for DYN and DYNH are not affected. The rating actions follow Dynegy's announcement that it has reached a defin= itive agreement to acquire Enron Corp. in a stock-for-stock transaction und= er which Enron shareholders will receive a fixed amount of DYN shares. Fitc= h does not anticipate the rating of the combined company dropping below the= mid-`BBB' range based on its preliminary assessment.=20 The transaction carries significant financial support from ChevronTexaco Co= rp. (CVX) a 27% stakeholder in DYN which has committed to provide up to $= 2.5 billion of new equity to DYN. The CVX equity commitment includes a $1.5= billion cash injection to occur over the next several days which in turn = will immediately be contributed by DYN to Enron to provide interim liquidit= y support. This upfront capital contribution will be structured as a prefer= red stock investment with an option to buy 100% of the common stock in Nort= hern Natural Gas Co. (NNG). The remaining $1.0 billion of equity will be fu= nded at closing. In addition CVX has options to contribute up to $1 billio= n of additional equity at specified amounts and retains its rights to maint= ain its current economic interest in the merged entity. The transaction is = expected to close within six to nine months and will require several regula= tory approvals including the Securities and Exchange Commission (SEC) Fed= eral Energy Regulatory Commission (FERC) and Hart-Scott Rodino.=20 Fitch is revising its Rating Watch on Enron's outstanding debt securities t= o Evolving based on conditions of the transaction which address several maj= or concerns the most time sensitive being liquidity. The $1.5 billion equi= ty infusion improves Enron's liquidity position which now appears adequate= to fund Enron's cash needs through the first quarter of 2002 under expecte= d business conditions. However Enron faces significant refinancing risk. E= nron's fully drawn $1.75 billion 364-day committed bank credit facility is = up for renewal in April 2002 and the $2.4 billion of outstanding Osprey Tru= st notes are expected to be repaid by mid-2002. Relating to Osprey Fitch e= stimates that trust asset sale proceeds will not be adequate to fully fund = maturing Osprey debt. Therefore Enron will potentially need to provide mor= e than $500 million to pay off the notes. Fitch will closely monitor Enron'= s cash position through the merger period.=20 Fitch anticipates that the surviving company's rating would move to the mid= -`BBB' range assuming the successful execution of its interim plans to dele= verage its capital structure and the completion of the merger. If the merge= r were to terminate Fitch believes Enron's ability to manage its business = would be severely impaired and would expect to downgrade its securities to = highly speculative grade. Termination provisions to the merger agreement ad= d an element of uncertainty to completing the merger. If the transaction we= re terminated DYN would have the option to own NNG removing both a valuab= le property and stable cash flow source from Enron's credit profile.=20 The Rating Watch Negative status for DYN and DYNH reflects some uncertainty= over the ultimate outcome of its post-merger credit profile. While the pro= posed transaction structure will not require incremental debt financing DY= N will likely assume many of the difficulties which continue to plague Enro= n including the need to sell underperforming emerging market assets the on= going SEC investigations of certain Enron sponsored partnerships and poten= tial litigation arising from several shareholder suits filed against Enron.= While Enron management is actively working to reduce debt and exit problem= businesses it is possible that not all outstanding issues will be resolve= d within the transaction approval timeframe.=20 A positive consideration for DYN is the structure of the merger agreement w= hich contains a series of out provisions enabling it to terminate the merge= r upon occurrence of specific material adverse changes including Enron liti= gation exposure in excess of specified levels or a drop in Enron's senior u= nsecured credit rating below investment grade. In addition Dynegy's upfron= t capital contribution is protected by the underlying value of NNG. Based o= n these provisions Fitch would not expect to change Dynegy's current long-= term ratings in the event the transaction became unwound.=20 Other positives resulting from the merger include: improved management cred= ibility through Dynegy's assumption of senior executive positions and board= of directors control the reduction of leverage at the new company from Ch= evronTexaco's equity commitment the aggressive downsizing and exiting of n= on-core operations potential cost savings through the merger conservative= ly estimated at $500 million annually and the market strength of the merge= d company particularly as it relates to Enron's and Dynegy Holdings' North= American wholesale marketing and trading franchises.=20 The following ratings are impacted by today's rating action: Enron -- `BBB-' senior unsecured debt -- `BB' subordinated debt -- `B+' preferred stock -- `F3' commercial paper. Northern Natural Gas Co. Transwestern Pipeline Co. -- `BBB-' senior unsecured debt. Dynegy Inc. -- `BBB' implied senior unsecured debt rating. Dynegy Holdings Inc. -- outstanding `BBB+' senior notes. Dynegy Capital Trust I -- outstanding `BBB' trust preferred securities. CONTACT: Fitch New York Ralph Pellecchia 212/908-0586 Robert Grossman 21= 2/908-0535 Hugh Welton 212/908-0746=20 18:40 EST NOVEMBER 9 2001=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 ChevronTexaco to Invest $2.5 Billion in Dynegy 11/09/2001 PR Newswire (Copyright (c) 2001 PR Newswire) Supports Dynegy's Merger with Enron=20 ChevronTexaco Holds Warrants to Increase Investment=20 SAN FRANCISCO Nov. 9 /PRNewswire/ -- ChevronTexaco Corp. (NYSE: CVX) today= announced that it has committed $2.5 billion of new equity in Dynegy Inc. = (NYSE: DYN) in support of Dynegy's planned merger with Enron (NYSE: ENE). ChevronTexaco which currently owns approximately 26 percent of Dynegy's ou= tstanding common stock immediately will invest $1.5 billion in convertible= preferred shares in Dynegy in order to fund Dynegy's equity infusion into = Enron. The $1 billion balance of ChevronTexaco's equity purchase of Dynegy = common stock would be made upon the closing of the Dynegy-Enron merger. The= se investments will be made at a significant discount to Dynegy's closing p= rice today.=20 Following the closing of the merger which is subject to regulatory reviews= and Enron and Dynegy shareholder approval ChevronTexaco would hold approx= imately 26 percent of Dynegy's outstanding common stock and would maintain= its three seats on the Dynegy Board of Directors.=20 Under terms of its agreement with Dynegy ChevronTexaco will be granted war= rants to purchase an additional $1.5 billion of Dynegy common stock over a = period of up to three years from the completion of the merger. Our equity = interest in Dynegy is highly complementary to our larger portfolio of asset= s and activities and reflects our strategy to participate in the growing e= nergy convergence marketplace including wholesale and retail marketing an= d trading of energy products and services said David J. O'Reilly chairma= n and chief executive officer of ChevronTexaco. Our relationship with Dyne= gy has proven to be highly beneficial for both companies and we are optimi= stic we will continue to see comparable or better performance in the future= .=20 This additional investment in Dynegy which is expected to be immediately = accretive to ChevronTexaco underscores our belief in the long-term value p= otential of this sector. We have additional upside through our warrants. We= have confidence in the Dynegy leadership team headed by Chuck Watson to = bring a disciplined management approach to this complex business and to bui= ld a larger and more profitable company through this merger. We are also ho= peful that the combination of Dynegy and Enron will restore market and cred= it confidence in this important energy sector O'Reilly continued.=20 In the event that the merger between Dynegy and Enron is not completed Che= vronTexaco can redeem its convertible preferred shares for $1.5 billion in = cash or convert to common shares. In the latter event ChevronTexaco would = own an approximate 36 percent equity interest in Dynegy.=20 We believe this expanded investment offers us an opportunity to create gre= ater value and provide significant upside potential for ChevronTexaco share= holders as Dynegy strengthens its leadership position in this sector O'Re= illy said. Through our membership on the Dynegy board we will continue ou= r active role in the strategic direction of the company.=20 Private Securities Litigation Reform Act Safe Harbor Statement=20 Except for the historical and present factual information contained herein= the matters set forth in this press release including statements as to th= e creation of greater value for stockholders expected benefits of the merg= er of Dynegy and Enron and other statements identified by words such as a= nticipates expects projects plans and similar expressions are fo= rward-looking statements within the meaning of the safe harbor provisions= of the Private Securities Litigation Reform Act of 1995. These forward-loo= king statements are not guarantees and are subject to risks and uncertainti= es that may cause actual results to differ materially including the possib= ility that the anticipated benefits from the merger and ChevronTexaco's inv= estment in Dynegy cannot be fully realized the possibility that costs or d= ifficulties related to the merger will be greater than expected and the im= pact of competition and other risk factors relating to our industry as deta= iled from time to time in ChevronTexaco's periodic reports filed with the S= EC.=20 MAKE YOUR OPINION COUNT - Click Here=20 /CONTACT: media Fred Gorell +1-415-894-4443 or investors Pierre Breber= +1-415-894-9376 both of ChevronTexaco Corp./ 18:39 EST=20 Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =09 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enrons secret bid to save deregulation - PRIVATE MEETING Chairman pitches his Body:: Jeff Candidly this wouldn't have been my approach (posh location closed format odd group seemingly self-serving agenda). I read the article below as unsympatheticand almost mocking in its tonetoward Enron. It's noteworthy theBeverly Hills meeting was not covered in the Los Angeles papers. Instead this article comes fromthe front page of the Bay Area's San Francisco Chronicle (Democratic bastion and home to both of California's United States Senators power broker Willie Brown Attorney General Bill Lockyer and the state's public utility commission). Consistent with myconcern about a coast-to-coast firestormengulfing Enron the New York Times ran two articles today that were unsupportiveof the company. q Senator Calls for Hearings Into Energy Regulators' Moves By CHRISTOPHER MARQUIS Senator Dianne Feinstein called for hearings into possible improprieties between members of the F.E.R.C. and private energy interests. q Enron's Dispute With Utility in India Grows More Tangled By SARITHA RAI The dispute between the Enron Corporation and Indian federal and state government officials keeps getting messier. These follow the Times' tough piece on Ken Lay yesterday. Undoubtedly the Washington Post will have to get into fray soon. My feeling is that just as with the business side Enron's public policy strategy needs be well informed sophisticated and comprehensive. I fear that anything less will fuel the potential of undesirable outcomes for Enron's reputation leadership and shareholdervalue. Kevin 213-926-2626 PS - May I have a copy of the position paper that was circulated in the Beverly Hills meeting. The Gate www.sfgate.com Return to regular view Enron's secret bid to save deregulation PRIVATE MEETING: Chairman pitches his plan to prominent Californians Christian Berthelsen Scott Winokur Chronicle Staff Writers Saturday May 26 2001 ?2001 San Francisco Chronicle URL: Energy executive Kenneth Lay head of powerful Enron Corp. quietly courted Arnold Schwarzenegger Richard Riordan Michael Milken and other luminaries this week in Beverly Hills to drum up support for his solution to California's energy crisis. His prescription called for more rate increases an end to state and federal investigations and less rather than more regulation. Lay a close friend of President Bush and one of his largest campaign contributors hosted a private 90-minute meeting in a conference room at the Peninsula Hotel in Beverly Hills on Thursday. Among the participants were Milken the former head of the Drexel Burnham Lambert investment banking firm who pleaded guilty to fraud charges in 1990 and who now runs a think tank based in Santa Monica movie star Schwarzenegger and Riordan the mayor of Los Angeles. Schwarzenegger and Riordan have been courted recently as GOP gubernatorial candidates. One participant who agreed to speak on the condition he not be identified said the meeting appeared to be geared toward getting participants to support Lay's vision and then champion it to officials who are trying to solve the state's energy mess. PLAN TO RESCUE DEREGULATION The source said the timing and tone of the meeting suggested Lay is concerned that California will abandon its disastrous experiment with power markets by either re-regulating the system or creating a government authority to provide electricity. Gov. Gray Davis signed legislation last week to create and fund a state power authority that would build buy and run power plants in California. They're trying to rescue deregulation the source said of Enron executives. They think the whole state power authority is a bad idea. At the meeting Enron representatives circulated a four-page position paper titled Comprehensive Solution for California which was obtained by The Chronicle. It said ratepayers should bear responsibility for the billions in debt incurred by the state's public utilities and that investigations of power price manipulation and political rhetoric are making matters worse. The paper made no mention of the possibility that much of the runaway electricity costs in California is due to market manipulation by power generators and traders -- a possibility given credibility in studies by regulators and economists. One of the talking points read: Get deregulation right this time -- California needs a real electricity market not government takeovers. Another point suggested giving consumers monetary rebates for conserving electricity. INVOLVED IN EARLY DAYS Lay has been an aggressive champion of deregulated electricity markets and was an early advocate in persuading California to begin its experiment with a competitive power market system. Lay has created a new kind of company in the process one that essentially produces nothing but makes money as a middle-man buying electricity from generators and selling it to consumers. During the first quarter of this year Enron's revenues increased 281 percent to $50.1 billion. Asked about the purpose of the meeting Karen Denne a spokeswoman for Enron said she would look into that and then did not return repeated telephone calls seeking comment. One participant said Denne was present at the meeting. D.C. CONNECTIONS Meanwhile Lay's power in Washington is reported to have reached unprecedented heights. According to a story in yesterday's New York Times Lay supplied the Bush administration with a list of candidates for jobs regulating the power industry and even interviewed one of them. The story also said Lay essentially threatened to seek the removal of the chairman of the Federal Energy Regulatory Commission Curt Hebert if he does not support Lay's desire to further deregulate the nation's electricity system. Lay denied the allegation. Also in attendance at this week's meeting were Bruce Karatz chief executive of home builder Kaufman & Broad Ray Irani chief executive of Occidental Petroleum and Kevin Sharer chief executive of biotech giant Amgen. Among those who were invited but did not attend were former Los Angeles Lakers star Earvin Magic Johnson supermarket magnate and Bill Clinton supporter Ron Burkle and Dennis Tito recently returned from the world's first civilian space trip. Milken through a spokesman confirmed that he attended the meeting but declined to be interviewed. Schwarzenegger could not be reached for comment through a publicist and Sharer did not return a call yesterday afternoon. A spokesman for Riordan Peter Hidalgo said the Los Angeles mayor attended but was not intending to formulate any kind of policy position on this issue. His intent is to listen to all sides. Attached to the Enron handout was a two-page open letter addressed to Davis and the state Legislature apparently prepared for those who support Lay's position and would be willing to sign their names to it. The source who participated in the meeting said those assembled appeared noncommittal and asked a number of questions of Lay but did not agree to champion his agenda. E-mail the writers at cberthelsen@sfchronicle.com and Scott Winokur at swinokur@sfchronicle.com . ?2001 San Francisco Chronicle Page A - 1 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Canary Wharf - Update for Executive Committee Body:: Maybe we should knock down the walls of those cavernous offices on the top= =20 floor. Mark Frevert@ENRON 07/24/2000 06:17 AM To: Steven J Kean/HOU/EES@EES Cindy Olson/Corp/Enron@ENRON Mark=20 Palmer/Corp/Enron@ENRON Mark Koenig/Corp/Enron@ENRON cc: =20 Subject: Canary Wharf - Update for Executive Committee Just a quick update on our real estate escapades. Regards . Mark ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential Concern Body:: Sharon I suggest that we ask Valeria Hope to investigate the fact situation here and report back to us jointly. What do you think? Michelle What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: NEW DRAFT OF ENRON STATEMENT Body:: As discussed. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Andre LeGAllo Body:: Any problem? please advise Don. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - March 2001 Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: I couldn't open link. I s this something new for me to sign or have I already complied? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Revised list of PRC Reps Body:: Make sure this is consistent with the lists we put in the memo. thanks What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EPSA/EEI on Reliability Body:: This follows up on Rick's inquiry late last week on the talks between EPSA and EEI on reliability. Yesterday I spoke with Mark Bennett and Donn Salvosa of the EPSA staff. Mark did the talking. The upshot is that EPSA and EEI are meeting to see if they can't agree on reliability legislation. EEI is working off of the NERC draft and has sent a version to EPSA dated 9/14 (see attached) that was the basis for last Thursday's meeting. EPSA is now doing some drafting of its own. I need to read the 9/14 draft but the fact that they are working off of the old NERC language is of considerable concern. EPSA staff emphasizes the value of having EEI off the NERC reservation (which is good in terms of showing that there is NERC consensus) but I think EPSA staff may be too flexible in how they are approaching it. I reminded them of our position and concerns and of Jim's prepared statement on EPSA's behalf filed for the Sept. 11 Barton hearing. EPSA staff claims that other EPSA members are OK with them embarking on this project. It is not clear if this effort will succeed. EPSA staff said EEI's board insists on having engineers do reliability which is objectionable to EPSA. EPSA staff seems to think that some type of reliablity SRO is inevitable and that it is wise to get the best one they can. I will check with some other EPSA members. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Urgent!!! FLSA legislation is on the fast track Body:: Joe - could you or someone in the office get in touch with Michelle? Thanks What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Report on Energy and Commerce Status (Ignore Earlier E-Mail That Was Not Complete) Body:: Confirming earlier indications at about 3 pm EDT today Chairman Tauzin convened the committee to issue a joint statement with Rep. Waxman and then recessed the committee subject to the call of the chair following the Memorial Day Week Recess. Congress will not return until the week of June 4 but staff level discussions will likely occur after the three-day weekend. Chairman Tauzin said that the committee is receiving conflicting information on the facts in California. He said it is better to take a little longer to get the facts straight and evaluate various options rather than act quickly but in the wrong way. He did say he expects that the committee will come to a bipartisan agreement after the recess. Behind the scenes we hear that Democrats appear not to want to reach an agreement instead preferring to keep the issue alive. Republicans on the other hand want to spare their vulnerable West Coast Members another recorded vote against price caps. Thankfully following our collective efforts yesterday the discussion has moved off of the 80/20 long term contract requirement. Republicans are poised to offer the Ose bill as an alternative for discussion and amendment if an agreement is not reached. The Ose bill would extend FERC's pricing formula to 24/7 and throughout the West. Staff report that Members were far from agreement and that no one concept was embraced for further refinement. It does appear however that some Members such as Rep. Mary Bono (R-CA) are pushing for some type of price mitigation that they can vote for. With Republicans increasingly worried about the political impact of the energy issue we will need to continue our work next Tuesday starting with an in-depth analysis of the Ose bill. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: i2 Bandwidth Management Agreement Press Release Body:: fyi What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Risk Matrix Body:: FYI. I had started an informal discussion group to work on political/regulatory risk.. I included Jane Jim Bouillian and Scott Gahn. Jane sent me the atached as an example of how her group approaches issues in the acquisition context. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Next Draft of Letter to Dunn Body:: I think this is an excellent letter. I agree with Sue's comments and have included her changes on Page 3. All changes have been marked in this version. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Regulatory Policy Committee Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Draft of California Contact List Body:: Steve ? This is a draft of the contact list I promised you.? There are still some typos in it.? I will clean them up and get send you a draft in the morning that is ready for circulation. ? This list is made?up of?people that I know?and trust.? By an large I have excluded sitting pubic officials.? In cases where a given organization has several useful contacts with similar knowledge I have listed just one person for now. ? Give me a call at your convenience and we can discuss this in great detail. ? Kevin 213-926-2626 - Kevin Scott - Key Contacts - Draft.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Inquiry Body:: Steve I hope this email finds you well. ?Don't know if you remember me exactly however I worked at Enron for 4 years working closely with the Associate/Analyst Program under Charlene Jackson. ?I had to spread my wings a bit and flew to Reliant Energy to further enhance my career. As a former Enron employee I know Enron-candidate material! ?I would like to submit confidentially of course a resume on AJ McCormac. ?AJ is currently the Executive Director for Workforce Planning (HR) here at Reliant. ?She is very interested in opportunities at Enron and has the right stuff to compliment your strategic direction and objectives for Human Resources. ?I am confident that after just a few minutes with AJ you will quickly recognize her superior expertise. Realizing how expensive executive search firms can be advice from a Enron fan is free. Thank you for your time and consideration. ?If you would like to contact her directly here at Reliant her number 713-207-7162. Ginger Gamble 713-207-8824 (See attached file: AJ Confidential Resume 9-21-00.doc) (See attached file: AJ Confidential Resume 9-21-00.doc) - AJ Confidential Resume 9-21-00.doc What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CONFIDENTIAL - Residential in CA Body:: Before any decision is made I think we really need to weigh in with EES on the ramifications (both PR and legislative) of turning back 16000 residential customers. I strongly believe that the public hit we will take will be far greater than our actual out-of-pocket losses. We will be crucified by the public media consumer groups legislators governor attorney general etc. and this action will reaffirm our reputation of packing up and leaving when it's not in our interest. The impact of this action would be exacerbated since it is on the heels of UC/CSU. I would also argue that this hurts our national dereg efforts. If we're advocating that competition and choice benefits consumers and then we turn around and pull out of a market and abandon customers when we're not profiting we'll kill any chances we have of ever serving retail customers in California -- or in any other state. We look foolish advocating for direct access when we're not willing to serve our existing -- let alone future customers What about a preemptive strike that engages these 16000 customers to weigh in on direct access -- i.e. a letter that says Enron may be forced to cancel its contract -- call/write/send the enclosed postcard to your legislator and tell them you want to keep your right to choose your energy service provider. Our credibility is on the line. Before we take this action we need to be cognizant of all the long-range strategic implications and we need to seriously weigh the negative impact this will have on our corporate reputation on our legislative abilities and on our commercial success going forward. kd James D Steffes 04/12/2001 09:05 PM To: Jeff Dasovich/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Sandra McCubbin/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Mark Palmer/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON Susan J Mara/NA/Enron Peggy Mahoney/HOU/EES@EES Harry Kingerski/NA/Enron@Enron cc: Dan Leff/HOU/EES@EES Subject: CONFIDENTIAL - Residential in CA In the meeting today no decision was made about what to do with Enron's 16000 residential customers. Each of the contracts gives a basic 30 day out right to Enron. That being said I think that we have a short window to push for DA before any public action impacts us in Sacramento. I realize that the ultimate action (which I think is inevitable) makes it harder for our advocacy on DA but real $ are flowing out of the company. EES will give us notice when a decision is reached. Thanks Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: GREAT NEWS ****FERC Order on Morgan Stanley Complaint Against ISO Body:: See below. this is one of the issues that concerned us more than price caps because it could limit our ability to move power to other markets in the west. In addition if you get questions from the analysts on reregulation or price caps it is worth pointing out that the high prices prevailing in many markets help our retail sales pitch to end use customers and create opportunities for our wholesale price risk management services . . . even a $250 price cap is 5-10 times what large customers are accustomed to paying. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Draft - Background and Q&A for CA residential customers Body:: Please send any comments directly to Peggy. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Trade Mission Body:: Terry was acting with full coordination from Jose. The problem was this: Daly insisted someone speak on behalf of the group to the press (and designated Terry to be the one) Terry did not have the updated information that we were about to meet with the government officials and deliver a slightly different message (i.e. that we needed to know if the government planned to really open Petrobras or not -- the implication being that we would work within either decision but we needed to know one way or the other) Terry was simply not in possession of this information and no one had given it to him (probably because they had no reason to assume that Terry would be thrust in front of the press) moreover it's hard to see how Terry could have taken such a position publicly anyway. By my eyes Terry did the best he could and we had an unavoidable communications bust. I know the Southern cone team is moving to make it right but I see absolutely no reason to come don on anyone about this. Richard Shapiro 02/17/2000 09:47 PM To: Steven J Kean/HOU/EES@EES cc: Subject: Re: Trade Mission What was the outcome? Steven J Kean 02/17/2000 08:13 AM To: Richard Shapiro/HOU/EES cc: Subject: Re: Trade Mission FYI. I will call Terry and get in touch with Jim/Diomedes ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - JB 003 Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: IEP News 4/20 Body:: AP Online April 20 2001 Friday 7:57 AM Eastern Time Financial pages ????238 words Power Co. Executives Lose Bonuses LOS ANGELES Contra Costa Times April 20 2001 Friday STATE AND REGIONAL NEWS K560 ????460 words Energy officials accused of manipulating natural gas market ????defend actions By Andrew La Mar Los Angeles Times April 20 2001 Friday Home Edition Page 3 715 words ???? CALIFORNIA AND THE WEST ??A U-TURN ON CAR TAX REBATES ??LEGISLATION: ????STARTING JULY 1 FEE REDUCTION WILL BE FIGURED DIRECTLY INTO VEHICLE ????REGISTRATION BILLS NOT REFUNDED BY MAIL. CARL INGRAM TIMES STAFF WRITER ????SACRAMENTO Los Angeles Times April 20 2001 Friday Home Edition Page 3 453 words ???? CALIFORNIA AND THE WEST ??LOCKYER ASKS JUDGE TO ORDER FIRMS TO RELEASE ????RECORDS ROBERT J. LOPEZ and RICH CONNELL TIMES STAFF WRITERS Los Angeles Times April 20 2001 Friday Home Edition Page 3 1426 ????words CALIFORNIA AND THE WEST ??LEGISLATORS UNITE OVER ENERGY PRICE ISSUE ????POWER: BIPARTISAN CONGRESSIONAL DELEGATION CALLED TOGETHER BY DAVIS SAYS U. ????S. MUST STEP IN TO PROTECT STATE FROM MANIPULATION BY SUPPLIERS. MITCHELL ????LANDSBERG and MIGUEL BUSTILLO TIMES STAFF WRITERS The Orange County Register April 20 2001 Friday STATE AND REGIONAL NEWS ???? K497 846 words Federal energy commission considers price fix for state ????energy market By Dena Bunis San Jose Mercury News April 20 2001 Friday STATE AND REGIONAL NEWS ????K512 696 words In response to power woes rating agencies have California ????on credit watch By Jennifer Bjorhus San Jose Mercury News April 20 2001 Friday STATE AND REGIONAL NEWS ????K520 1069 words Issues still remain on what power consumers will ????eventually pay By John Woolfolk and Michael Bazeley The San Francisco Chronicle APRIL 20 2001 FRIDAY FINAL EDITION NEWS ????Pg. A4 765 words Edison pushes lawmakers to accept deal David Lazarus The Associated Press State & Local Wire April 20 2001 Friday BC cycle ????7:04 AM Eastern Time State and Regional 438 words Most Edison executives ????going without bonuses By GARY GENTILE AP Business Writer LOS ANGELES The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? State and Regional 901 words Top political aide discusses Bush's low-key ????style By RON FOURNIER AP White House Correspondent WASHINGTON The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? State and Regional 727 words Utility commission staff says parent ????company profiting from energy sales BOISE Idaho The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? State and Regional 820 words Legislators probe possible power natural ????gas collusion By DON THOMPSON Associated Press Writer SACRAMENTO Copyright 2001 Associated Press AP Online April 20 2001 Friday 7:57 AM Eastern Time SECTION: Financial pages LENGTH: 238 words HEADLINE: ?Power Co. Executives Lose Bonuses DATELINE: LOS ANGELES BODY: ???Senior executives at Southern California Edison and its parent company went without hundreds of thousands of dollars in bonuses in 2000 because of California's power crisis. ??Edison International's chairman and chief executive John Bryson was paid $950000 in 2000 compared with salary and bonus totaling $2.16 million in 1999. ??Stephen Frank the chairman and chief executive at Southern California Edison was paid $617000 in 2000 compared with salary and bonus totaling $1.3 million in 1999 according to the company's proxy statement filed with the Securities and Exchange Commission. ??The company also said Thursday it would not award merit increases to executives in 2001 because of the continuing crisis. ??In a similar statement released Tuesday Pacific Gas and Electric Corp. revealed it also withheld bonuses for its top two executives although they did receive raises. ??Edison and PG&E say they have lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Edison is continuing to work with state officials and its ??reditors. ?????(PROFILE ?????(CO:Southern California Edison Co. TS:SCE) ?????(CO:Pacific Gas and Electric TS:PCG IG:ELC) ?????) LOAD-DATE: April 20 2001 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service Costa Times 20 2001 Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K560 LENGTH: 460 words HEADLINE: Energy officials accused of manipulating natural gas market defend actions BYLINE: By Andres LaMar BODY: ??SACRAMENTO _ Energy officials who are accused of manipulating California's market for natural gas defended their actions on Thursday and attributed the state's skyrocketing gas prices to increased demand the weather and other factors. ??The explanation however drew skepticism from lawmakers in the wake of expert testimony alleging that one Texas firm El Paso Natural Gas Co. had engineered a classic case of monopoly power by controlling the pipeline that delivers gas to the state. ??At the outset of the Thursday's hearing Assemblyman Darrell Steinberg D-Sacramento noted the huge run-up in the cost of natural gas which went from $6.6 billion for the entire year of 1999 to $12.3 billion for sales in 2000 and to $7.9 billion for the first three months of this year. ??Steinberg zeroed in on the difference between California and other parts of the country. From March 2000 to February 2001 natural gas prices have risen 489 percent compared to a 266 percent increase in New Mexico and a 247 percent jump in Chicago. ??Steinberg asked Ralph Eads the president of an El Paso Natural Gas Co. subsidiary for an explanation. ??The 275 percent difference you say is attributable completely to constraints on the pipeline and demand? Steinberg asked. ??Yes Eads replied. Eads said the state's energy crisis which led power plants to run harder and longer dramatically increased demand for natural gas over the summer and a winter with temperatures about 15 percent cooler than the year before exacerbated the problem. ??In another twist to California's deregulation nightmare El Paso officials said they gained greater control of the pipeline after the Pacific Gas & Electric Co. relinquished the capacity four years ago. At that time PG&E's movement of the gas and the prices it could charge were regulated by the Public Utilities Commission. ??In other developments at the Capitol on Thursday lawmakers called on the federal government to re- regulate natural gas sales at the California border and U.S. Sen. Joe Lieberman D-Conn. said federal regulators should impose price caps on California's wholesale electricity market. ??The Assembly held considerable debate on the resolution asking for re-regulation with Democrats accusing President George W. Bush of doing nothing to come to the aid of California and Republicans defending the administration. ??I'm learning an interesting lesson that all the problems of the world started after Jan. 21 and the inauguration of the new president said Assemblyman Bill Leonard R-San Bernardino. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 Contra Costa Times (Walnut Creek Calif.). ??Visit the Contra Costa Times on the Web at http://www.cctimes.com/ JOURNAL-CODE: CC LOAD-DATE: April 20 2001 of 78 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 20 2001 Friday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 715 words HEADLINE: CALIFORNIA AND THE WEST A U-TURN ON CAR TAX REBATES LEGISLATION: STARTING JULY 1 FEE REDUCTION WILL BE FIGURED DIRECTLY INTO VEHICLE REGISTRATION BILLS NOT REFUNDED BY MAIL. BYLINE: CARL INGRAM TIMES STAFF WRITER DATELINE: SACRAMENTO BODY: ??Gov. Gray Davis and the Legislature spun a U-turn Thursday and scrapped a costly program that requires motorists to first pay their car tax and then get a rebate in the mail. ??Starting July 1 the state Department of Motor Vehicles will send owners of approximately 26 million vehicles registration renewal bills already reduced by the amount of the vehicle license fee rebates. ??On a unanimous roll call the Senate voted final approval and sent to Davis an urgency bill SB 52 that repealed the rebate program which the governor had previously fought for and defended. ??In addition to abolishing the rebates the legislation reduces by 67.5% the amount motorists must pay for the upcoming year the level that lawmakers and former Gov. Pete Wilson envisioned in 1998 when they began cutting the fee. It had been about 2% of a vehicle's market value. ??Davis immediately signed the repeal bill saying only that the new law will expedite relief to taxpayers and greatly reduce administrative costs. ??The governor's muted observation contrasted with his effusive support of the rebates last year when he said Californians don't appreciate the fact that they're getting a rebate unless they see it in their hands. ??At the time Davis and the Legislature had the choice of simply cutting the car tax which voters might not notice or sending checks in the mail which Davis felt would have a greater impact. ??The rebates which began Jan. 1 were scheduled to continue through 2002 when Davis intends to run for reelection. In 2003 the license fee was to have fallen permanently with no more rebates. ??The whole rebate scheme was good only through the next gubernatorial election cycle said Sen. Tom McClintock (R-Thousand Oaks) who supported reductions in the license fee but opposed the rebates. ??Until July 1 the DMV will continue to bill motorists for the full amount of their license fee which includes a 35% reduction from last year. ??Then we return to you an additional 32.5% rebate making a total reduction of 67.5% said DMV spokesman Bill Branch. Starting with license renewals on July 1 the DMV bills will include the full tax cut. ??A Senate analysis of the repeal bill noted that the current awkward system . . . effectively requires taxpayers to overpay their vehicle license fee and then await a rebate check from the state--a system that is at best difficult to explain. ??But as the California economy tightened the state's budget surplus shrank and taxpayers shelled out approximately $ 50 million a day to buy electricity the costs of the rebate program threatened to become a political embarrassment to Davis. ??Projected administrative and postage costs of the rebate program alone were estimated at $ 22 million this year and another $ 22 million or so next year. ??Last year state Sen. Joe Dunn (D-Santa Ana) and McClintock sought to eliminate the rebates and give drivers their full tax cuts when they register their vehicles. Under pressure from Davis the bill failed. ??It was killed behind the scenes at the insistence of the governor McClintock said Thursday. He didn't want it on his desk. ??This year Dunn launched a similar bill but his name was struck from it as the lead author in the Assembly and the name of Sen. Wes Chesbro (D-Arcata) was substituted. ??In a speech Thursday Sen. Ross Johnson (R-Irvine) suggested that Davis' performance on the issue in an earlier time and a more just society would have resulted in his public flogging by representatives of taxpayers. ??The repeal bill was passed 78 to 0 by the Assembly on Monday and sent to Davis by the Senate on a 34-0 vote Thursday. ??If the rebates were to be abolished the bill had to pass this week in order to take effect July 1 said Branch the DMV spokesman. This is because motorists must be advised 60 days in advance that their registration renewals are due. ??We have to reprogram all the computers. We have to print new bills and mail them by May 1 for the July 1 expiration he said. It will be a little tight but we will still make it. ??Branch said that since the Jan. 1 start of rebates checks totaling $ 454 million have been sent to 7.4 million vehicle owners at an extra administrative cost of $ 9.4 million. LOAD-DATE: April 20 2001 of 78 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 20 2001 Friday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 453 words HEADLINE: CALIFORNIA AND THE WEST LOCKYER ASKS JUDGE TO ORDER FIRMS TO RELEASE RECORDS BYLINE: ROBERT J. LOPEZ and RICH CONNELL TIMES STAFF WRITERS BODY: ??California Atty. Gen. Bill Lockyer ratcheting up his investigation of possible civil and criminal violations by the state's power suppliers is asking a San Francisco judge to order two firms to hand over confidential records. ??In a motion filed Thursday in Superior Court Lockyer said Reliant Energy and Mirant Corp. have failed to comply with subpoenas for documents that were to be produced by March 19. ??Amid soaring electricity costs and rolling blackouts the attorney general launched an investigation of possible manipulation of wholesale electricity prices that have skyrocketed to record levels and have financially crippled the state's major utilities. ??Dozens of other public and private power suppliers are complying with the subpoenas. ??But in an interview Lockyer accused Reliant and Mirant of stonewalling investigators so they can keep enjoying these exorbitant profits and prices for as long as possible. ??Ultimately the companies will have to honor the subpoenas he said. I'm going to pit bull them he said. This is one we win. ??Both companies say they have done nothing wrong and played by the rules of California's flawed electricity deregulation plan. ??A spokesman for Houston-based Reliant said Thursday the firm is seeking court action of its own to ensure that sensitive business information will not be shared with other public agencies or its competitors. ??Last week Reliant asked a Los Angeles Superior Court judge to clarify the attorney general's obligation to keep proprietary information confidential. ??We're glad to cooperate with his investigation to the extent we can said Reliant spokesman Richard Wheatley. But we have not received sufficient assurances that Lockyer would keep the data confidential. ??Lockyer called Reliant's court filing frivolous and propagandistic and insisted that adequate safeguards are in place. He reserves the right under state law to share information with other government agencies aiding in his investigation but has said he will keep sensitive business information from being made public. ??Atlanta-based Mirant demanded and received similar guarantees of confidentiality Lockyer said. Mirant did not return phones calls Thursday. ??Lockyer did not discuss details of the probe or the kinds of information he's seeking. But based on the investigation so far he said it's beginning to get interesting. ??Other records indicate that the attorney general has sought 91 categories of information about the power merchants' activities. They include the operation of power plants trading information that may have been shared by private power suppliers and bidding strategies in the California market. LOAD-DATE: April 20 2001 of 78 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 20 2001 Friday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 1426 words HEADLINE: CALIFORNIA AND THE WEST LEGISLATORS UNITE OVER ENERGY PRICE ISSUE ?POWER: BIPARTISAN CONGRESSIONAL DELEGATION CALLED TOGETHER BY DAVIS SAYS U. S. MUST STEP IN TO PROTECT STATE FROM MANIPULATION BY SUPPLIERS. BYLINE: MITCHELL LANDSBERG and MIGUEL BUSTILLO TIMES STAFF WRITERS BODY: ??This may be the surest sign yet of the depth of California's energy crisis: A bipartisan cross-section of the state's congressional delegation brought together Thursday by Gov. Gray Davis not only agreed about the severity of the problem but also about the need for swift federal intervention. ??This meeting did not have the word 'Democrat' or 'Republican' used once Rep. Darrell E. Issa (R-Vista) said of the unusual spirit of cooperation at the meeting near Los Angeles International airport. ??Members of both parties said the Federal Energy Regulatory Commission must slash wholesale electricity prices so California utilities can once again afford to buy power. Since January the state government has been buying electricity on their behalf as skyrocketing wholesale prices put Pacific Gas & Electric Co. and Southern California Edison billions of dollars into debt and many power suppliers refused to sell to them PG&E has since filed for Chapter 11 bankruptcy protection. ??Although the Bush administration has said repeatedly that it is strongly opposed to price caps and FERC has refused to grant them California Republicans at the energy meeting said they are optimistic that the administration will agree to some other form of price regulation. They brushed aside the notion that such regulations might conflict with their ideological belief in a free market. ??This is not a free-enterprise situation Rep. Duncan Hunter (R-Alpine) said after the meeting. In fact it's just the opposite. ??Specifically citing the huge disparity between natural gas prices charged to California and those charged in other Western states he said California clearly has been the victim of unreasonably high energy costs. Under federal law the FERC must regulate the prices of companies if it finds they are exerting market power to drive prices to unreasonable levels. ??Executives from two Texas energy companies meeting with legislators in Sacramento denied Thursday that they had caused natural gas prices in California to artificially skyrocket by hoarding access to a critical pipeline into the state. ??After the extraordinary meeting in Los Los Angeles Rep. Brad Sherman (D-Sherman Oaks) said the biggest disagreement between California Democrats and Republicans appeared to be their relative faith--or lack thereof--in the ability of President Bush and his administration to help California. There has been much speculation that Bush who lost California in November has no political motive to help the state. ??We Democrats said Sherman hope very much that our skepticism is proven wrong. ??Davis--who sat flanked by Democratic U.S. Sen. Dianne Feinstein and the governor's newly appointed chief energy advisor S. David Freeman--said he used the meeting mainly to discuss the importance of conservation by Californians this summer and to ask the congressional delegation to pitch in. Five Republicans and more than a dozen Democrats attended the gathering. ??Feinstein said Thursday that she has asked for a third time to meet with Bush to discuss the energy situation. Meeting with Times reporters and editors Wednesday she described a recent meeting with Vice President Dick Cheney in which she said he ignored her appeal for federal assistance. ??Feinstein has been among those critical of natural gas companies saying they appear to have constricted access to a California-bound pipeline to run up prices. ??The Brattle Group a respected consulting firm alleged Wednesday before an Assembly committee that Dynegy Inc. and El Paso Natural Gas Co. had manipulated the market by charging so much for the rights to their pipeline capacity that they had in effect withheld access to it. ??That action the experts said directly forced companies trying to deliver gas to California to look for alternatives clogging other pipelines and causing a surge in prices. ??The explanation El Paso executives said was simple: Demand for gas soared in California because generators that use gas to make electricity increased production last year in response to the energy crisis. ??We're not withholding capacity--no one is said El Paso Merchant Energy President Ralph Eads. With these prices you want to sell every molecule. ??In other developments Thursday: ??* The agreement between Davis and Edison International to return its ailing utility arm to financial health is in deep trouble and could be rejected by legislators the Standard & Poor's credit rating agency said in a note to clients citing legislative and other sources. A rejection of the deal would be a humiliating setback for the governor S&P said. ??The agreement calls for among other things the sale of Edison's transmission grid to the state for $ 2.76 billion and the sale of $ 2 billion in bonds--both designed to pay off the utility's huge electricity debt. Edison agreed to several constraints including the sale of electricity to the state at prices tied to the cost of producing power. ??Since they returned Monday from a two-week recess state legislators have been sharply critical of the Edison agreement and have indicated a desire to tinker with aspects of the deal. Some lawmakers have said publicly that a bankruptcy protection filing by Edison like that of PG&E might not be such a dire outcome. ??But a senior Edison executive said it is way too early to give up on passage of the proposal which legislators have not yet seen in official form. ??There is an education process to do here the executive said of the highly detailed 38-page document. The legislators should be asking questions. That is appropriate. ??* The Public Utilities Commission voted to investigate whether alternative energy providers violated contractual agreements by withholding supplies from PG&E and Edison which owe them hundreds of millions of dollars. ??The action Commissioner Carl W. Wood said was prompted in part by lawsuits some providers have filed seeking release from their contracts with the cash-starved utilities. The producers of solar wind and geothermal energy account for more than 25% of California's electricity supply. ??The question is whether we will be able to rely on them in the long hot days of summer Wood said. ??Jack Raudy of the Renewable Energy Creditors Committee said the PUC needs to address the $ 700 million the producers are owed. All we have gotten is rhetoric from the governor the PUC and the utilities he said. ??* An $ 850-million plan to entice Californians to conserve precious megawatts appears to be running into roadblocks compounding predictions by state officials of tighter than expected energy supplies in May and June. ??Davis signed the conservation spending package last week earmarking $ 242 million of the new funds for the Public Utilities Commission to distribute to the state's investor-owned utilities to support existing conservation programs. ??But Barbara Hale director of the PUC's Division of Strategic Planning said Thursday that since Pacific Gas & Electric Co. filed for bankruptcy protection April 6 the utility has stopped releasing conservation funds. ??Hale testifying before a state Senate committee said PG&E's decision--coupled with the threat that Southern California Edison could follow a similar route to U.S. Bankruptcy Court--has complicated her agency's efforts. ??PG&E spokeswoman Staci Homrig said her company plans to petition the Bankruptcy Court to have the conservation funds designated as a trust and separated from assets tied up in the bankruptcy proceedings. She said if the court denies the request PG&E would ask to be permitted to pay the expenses anyway. The process she added could take about a month--too long in the view of some legislators given increasingly gloomy energy forecasts for late spring and early summer. ??Deputy Director Bob Therkelsen of the California Energy Commission said his agency had been counting on a number of small power producers to bolster their output during that period. But he said some producers did not purchase the necessary equipment because PG&E and Edison have failed to pay them in full for earlier electricity deliveries. ??It's not a huge amount he said of the anticipated production shortfall but every little bit helps. ??* ??Landsberg reported from Los Angeles Bustillo from Sacramento. Times staff writers Nancy Rivera Brooks in Los Angeles Carl Ingram and Julie Tamaki in Sacramento and Tim Reiterman in San Francisco contributed to this story. LOAD-DATE: April 20 2001 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ??????????????????????????The Orange County Register 20 2001 Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K497 LENGTH: 846 words HEADLINE: Federal energy commission considers price fix for state energy market BYLINE: By Dena Bunis BODY: ??WASHINGTON _ Californians who see federal re-regulation of the state's crisis-bound energy market as an answer to the impending summer emergency better look for some other solution. ??Even the short-term price fix that the Federal Energy Regulatory Commission may consider at its Wednesday meeting might be too little too late. ??Lobbyists lawmakers and other FERC-watchers say they have seen a slight shift in recent weeks among commission staff and at least one member. There is some willingness they say to consider some price controls even though the Bush administration is adamantly opposed to such measures. ??Many are looking to see if President Bush's choices for the two vacancies on FERC will provide a margin for change. ??But the commission's basic philosophy that open unregulated markets are best is not likely to change soon members say. ??I've been championing a revamping of FERC's antiquated standards for determining market-based rates Commissioner Richard Massey said Thursday. But with no success. My agency is not on the verge of turning on a dime on this market-based pricing. ??The standards are a joke Massey added because the commission never turns down requests for such pricing authority. More than 600 power sellers have been given that authority he said. ??For a power company to be allowed to charge whatever the market will bear it must show FERC for example that it doesn't have the power to manipulate the market and drive prices up. ??Any seller that can't pass our screen needs to fire their consultants and lawyers Massey said. ??While the overall philosophy remains consistent FERC staff has proposed to the commission that a Stage 3 electricity emergency in California should trigger cost-based rates a form of price controls. Such triggers would be in place for one year under the staff proposal. ??The commission may decide Wednesday whether to accept that proposal. It has to make some decision by May 1 on how the market will be monitored from now on. ??The theory behind controlling prices in Stage 3 says a FERC staff report is that during such an emergency generators have the greatest opportunity to manipulate the market and drive prices up. ??But generators have that power during Stage 2 and Stage 1 emergencies says Les Starck Southern California Edison Co.'s manager of federal regulatory affairs. Price caps during Stage 3 might avert the rolling blackouts associated with that level of crisis but they wouldn't do anything to stop generators from jacking up prices the rest of the time he said. ??It is not clear how long it would take for such price controls to take effect should the commission go along with the staff recommendation. ??We're close because summer is approaching Commissioner Linda Breathitt said Thursday. Breathitt who had firmly opposed any form of price controls said in an interview last month that given the worsening crisis in California she was open to considering some short-term measures. ??It's important to me that we address the summer Breathitt said but said she wasn't able to predict what the commission would do Wednesday. ??Even if an order is approved Massey said there could be delays while the power sellers file their costs with regulators and disputes over those filings are handled. ??Sen. Dianne Feinstein said Thursday such a move by the commission would be better than having no controls at all. There's no question that we're going to be in a Stage 3 emergency. ??Feinstein D-Calif. and other Western lawmakers have been urging FERC to step in sooner and with price controls that extend beyond just the emergency period. ??Waiting for Stage 3 to intervene is putting the whole grid at risk said Roger Hamilton a member of Oregon's Public Utility Commission. We have a real stability problem when you cut it that close. ??Feinstein says the future could well rest with the new commissioners particularly Patrick Wood the head of the Texas PUC who many believe will replace Curt Heber as FERC chairman if he is confirmed by the Senate. ??Even if Massey and Breathitt agree on broader price controls as chairman Heber could block consideration of such a move. It's unclear what stance Wood would take as chairman. ??The thing that deeply concerns me about Pat Wood is that he's from Texas Feinstein said. What's reassuring is that it appears from my personal discussion with him is that he appears to be pragmatic. ??But once again timing could be a problem. ??Bush has said he intends to nominate Wood and Nora Brownell a member of the Pennsylvania PUC but has not formally sent their nominations to the Senate. ??The Federal Energy Regulatory Commission is of vital importance right now and to let the time go on without filling the spots makes no sense Feinstein said. Please please please President Bush process your nominees. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 The Orange County Register (Santa Ana Calif.). ??Visit the Register on the World Wide Web at http://www.ocregister.com/ JOURNAL-CODE: OC LOAD-DATE: April 20 2001 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service Jose Mercury News 20 2001 Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K512 LENGTH: 696 words HEADLINE: In response to power woes rating agencies have California on credit watch BYLINE: By Jennifer Bjorhus BODY: ??SAN JOSE Calif. _ All three of the nation's influential judges of credit risk now have California on credit watch saying they are deeply concerned about the economic impact of the state's power crisis. ??The Fitch credit rating agency made it unanimous Wednesday when it warned that the thickening electricity quagmire as well as lower than expected tax revenues in February and March could spell broader risk for the state's budget. ??The announcement is a signal that Fitch too may downgrade its ratings on California's nearly $30 billion in public debt a move which could cost taxpayers millions. ??The announcement comes as state lawmakers mull a bailout plan for Southern California Edison Pacific Gas & Electric Co. sits in bankruptcy and state officials bleed through the state's general fund as they purchase expensive electricity for consumers. Earlier this week Gov. Gray Davis announced that the average daily bill for electricity purchases has risen from $45.8 million a day in the last week of March to $73 million a day. ??Moody's Investors Service and Standard & Poor's have already issued their own credit warnings although none of the three agencies has actually downgraded the state's very good double-A credit rating. ??Bond ratings are important yardsticks that bankers and investors use to price municipal and corporate bonds. A downgrade would force California to offer bondbuyers higher interest rates going forward costing taxpayers. ??The state was last at a lower A rating back in 1994. ??Moody's changed California's Aa2 general obligation bond rating outlook from stable to negative on April 6 the day Pacific Gas & Electric Co. filed for bankruptcy. Standard & Poor's has had the state's AA rating outlook at negative since January when the state began buying electricity for the utilities. ??The deciding factor for Fitch said Fitch vice chairman Claire Cohen was the disagreement over how the money from the new electricity rate hike will be spent. ??The California Public Utilities Commission ruled in late March that money generated by higher electricity bills should go first to pay the state Department of Water Resources which has been buying electricity for the utilities. Pacific Gas & Electric Co. has argued that if the state is paid first there won't be any money left for it. ??The utility is formally challenging the PUC decision and the move threatens to hold up the estimated $12 billion to $14 billion of bonds the Department of Water Resources plans to issue to buy more electricity. ??With that being appealed you don't have a clean authorization Cohen said. It signals to me that it could delay the financing process. ??A second concern is that the state isn't collecting as much in taxes as expected Cohen said. Tax collections for both February and March were below forecast. The amount of personal income tax the state collected in those months fell short by $455 million or 14% less than expected. ??Cohen said she made her decision before hearing that the state's power costs now exceed $70 million a day. Cohen and David Hitchcock the California analyst for Standard & Poors agreed those rising costs are a definite concern. ??It doesn't take much of a change in economic growth to make some of these projected fund balances disappear and so we're very worried about what the current economic activity is particularly in Northern California with some of the problems with the high tech area Hitchcock told analysts and investors last week in a conference call. ??State treasurer Phillip Angelides was traveling Thursday and couldn't be reached for comment. Other economy-watchers expressed concern. ??Sandy Harrison assistant director of the state Dept. of Finance said the move reinforced the importance of solving the current power problems soon. ??It's important to note that the rating hasn't been lowered yet and does remain very strong he said. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 San Jose Mercury News (San Jose Calif.). ??Visit Mercury Center the World Wide Web site of the Mercury News at http://www.sjmercury.com/ JOURNAL-CODE: SJ LOAD-DATE: April 20 2001 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service Jose Mercury News 20 2001 Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K520 LENGTH: 1069 words HEADLINE: Issues still remain on what power consumers will eventually pay BYLINE: By John Woolfolk and Michael Bazeley BODY: ??SAN JOSE Calif. _ State regulators last month announced an electric rate increase that would average a whopping three cents per kilowatt hour hit bills beginning in May and punish power pigs while sparing energy misers. ??Now much of that is up in the air. ??Higher rates are surely coming _ but not before June. Exactly which consumers and businesses will pay how much is uncertain as regulators rush to forge a rate structure from a tangle of more than 20 proposals. ??Their task has been complicated immeasurably by Gov. Gray Davis' decision to weigh in with a competing rate plan and Pacific Gas & Electric's move into bankruptcy court. ??Little details are moving billions of dollars around said Nettie Hoge of consumer advocate group TURN. ??All the proposals assume a tiered structure that forces the heaviest users of energy to pay the most. But key details yet to be decided mean consumers could see their average rates go up anywhere from 7 percent to 30 percent or more. ??Among them: ??_How much of an overall increase? The Public Utilities Commission approved a 3-cent per kilowatt hour increase last month which would boost utility revenue $4.8 million. Gov. Gray Davis' hike _ left vague in Davis' April 5 television address _ averages 2.8 cents for PG&E customers but only 2.3 cents for customers of Southern California Edison. ??_What regions of the state will pay? The commission agreed to raise rates only for Pacific Gas & Electric and Southern California Edison but Davis would include the additional 1.2 million San Diego Gas & Electric customers. ??_Should heavier users of electricity subsidize those who are exempt from the new rate increase? If so those users will find themselves paying much more than any of the average increase figures being tossed about. ??_How will utilities bill customers retroactively for the increase? At the time of the PUC vote on March 27 commissioner said their increase would take effect immediately. ??Various plans are being presented this week to an administrative law judge working for the commission. The judge is expected to recommend a rate structure to the PUC on May 4. Public hearings would follow May 7-11 and the commission would vote on a plan May 14 condensing to a few weeks a process that normally lasts nearly a year. ??Each of the major proposals before the commission assumes that residential customers using less than 130 percent of their baseline would be exempt from higher rates. That's mandated under a new law that allows the state to buy power. Customers already pay higher rates for exceeding their baseline which is the average basic level of use for each region of the state. ??Each major proposal also sets new tiers with progressively higher rates for medium use at 130 to 200 percent of baseline and heavy use over 200 percent of that level. ??But that's where the similarities end. ??The first distinction among the leading plans comes in the form of an assumption: How many residential customers will avoid any increase because they don't exceed 130 percent of their baseline? Davis says more than half commissioners say a little under half and PG&E says less than a third. ??The second difference among the plans is a real difference: What happens to everyone else? ??Under the plan by utilities commission President Loretta Lynch medium PG&E users would see average bills rise 9 percent and heavy users would see bills increase 36 percent. ??Davis' plan says medium PG&E users would see average bills rise 11 percent while heavy users would pay 37 percent more. But the average total bill increase for PG&E residential customers including those who are exempt would be 20 percent under his plan and 24 percent under Lynch's according to a statement on the governor's web site. ??Business customers would see proportionately greater increases averaging 30 percent under Lynch's proposal and 26 percent under Davis'. ??The most consumer-friendly of the various proposals comes from consumer-rights group TURN. They suggest an overall average residential increase of just 7.5 percent. ??TURN's plan assumes utilities cannot charge other customers more to make up for the energy misers shielded from rate increases under state law. ??PG&E disagrees with that interpretation. The utility wants other residential users to make up for any lost revenue from exempted customers through higher rates. Under the utility's plan residential customers would see an average rate hike of nearly 30 percent. ??The proposal these folks are pushing rips the heart out of that law said Matthew Freedman staff attorney for TURN. ??Another issue affecting consumers is how the utilities can bill for electricity used in April and May before the final plan is approved. ??Utility officials have objected to making the rate structure retroactive. Instead to recoup the revenue they are proposing a flat surcharge that everyone would pay regardless of how much they use. ??Edison proposes a higher surcharge added to bills for a shorter period of time _ in this case June through August. PG&E officials are suggesting a smaller surcharge that would be spread out over 12 months. ??It'll probably be something closer to the PG&E proposal Paul Clanon the commission's director of energy issues. ??All the rate increase proposals stem from a commonly understood problem: California's current frozen rates don't generate enough money to cover the wholesale price of power. The PUC raised rates 10 percent _ or 1 cent per kilowatt hour _ in January in an attempt to help but that turned out to be far from enough. ??In March the Commission approved an additional 3-cent increase. But Davis followed quickly with an alternative proposal. The next day PG&E filed for bankruptcy raising the specter that a federal judge could order even higher rates. ??Although the PUC has sole authority to raise rates under state law Davis' proposal has complicated an already complex process. The governor appointed three of the five members of the commission and his appointees seem inclined to show him deference. But Davis has been slow in filing the details of his plan which has made it hard for the PUC to proceed. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 San Jose Mercury News (San Jose Calif.). ??Visit Mercury Center the World Wide Web site of the Mercury News at http://www.sjmercury.com/ JOURNAL-CODE: SJ LOAD-DATE: April 20 2001 of 78 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????APRIL 20 2001 FRIDAY FINAL EDITION SECTION: NEWS Pg. A4 LENGTH: 765 words HEADLINE: Edison pushes lawmakers to accept deal SOURCE: Chronicle Staff Writer BYLINE: David Lazarus BODY: Although lawmakers are skeptical of the state's multibillion-dollar deal to acquire the power lines of Southern California Edison the head of the utility's parent company warned yesterday that failure to approve the accord could lead to a long and costly bankruptcy. ???But John Bryson chief executive of Edison International told The Chronicle that he thought legislators would want to do the right thing by approving the multibillion-dollar agreement and preventing Edison from following Pacific Gas and Electric Co. into bankruptcy court. ???Bankruptcy for California's two largest utilities could have severe consequences for consumers. Financial analysts said a worsening of the state's energy mess would increase the possibility of higher electricity rates. ???Nevertheless lawmakers are unlikely to accept the Edison deal -- at least not in its present form. ???We are going to go through this thing extensively said state Senate President Pro Tem John Burton D-San Francisco. There are a lot of concerns about the valuation. ???Still he said legislative backing for the accord remains possible as long as Edison is open to amending some of the terms. ???The Edison people are smart enough to know that the Legislature is going to have its say Burton said. ???Indeed sources familiar with the matter said Edison expected a certain amount of tinkering with the deal and would not resist efforts to reach common ground with lawmakers. ???The Assembly members do not view bankruptcy as a favorable alternative said Assemblyman Herb Wesson D-Los Angeles. There will be a big effort to try and work something out. ???Edison's Bryson seems eager at this point to present himself and his company as reasonable business partners who are willing to negotiate in good faith. ???This contrasts sharply with the state's relations with PG&E which turned acrimonious after PG&E blindsided the governor with its bankruptcy filing. Each side blamed the other for the collapse of earlier negotiations. ???We made the decision at an early stage that this was a massive problem for the state and that the best course was to find a practical solution that would allow us to get on with operating our power system Bryson said. ???Bankruptcy he said is absolutely a last resort. It's a long and costly process. ???It is also the last thing Wall Street wants to see. On Wednesday rating agency Fitch Inc. joined Standard & Poor's and Moody's Investor Service in warning that California's credit rating could be lowered because of the state's energy mess. ???The state may be forced to issue junk bonds said Carol Coale an energy-industry analyst at Prudential Securities in New York. This could lead to a surcharge on electricity bills to guarantee the bonds. ???Bryson not surprisingly defended Edison's agreement with the governor as a prudent alternative to bankruptcy. ???This is a very good deal for the state he said. It is not a bailout. Edison gives up a lot to make all this possible. ???Southern California Edison will sell its power lines to the state for $2.8 billion. It also will provide low-cost power to California for 10 years and drop a federal lawsuit seeking full recovery of nearly $5 billion in past debt. ???Critics say the state is paying far too much for Edison's transmission system -- more than two times book value -- and that the power lines are of little use unless PG&E's grid also can be acquired. ???It's a multibillion-dollar ratepayer bailout of Edison said Doug Heller a spokesman for the Foundation for Taxpayer and Consumer Rights in Santa Monica. Edison gets off scot-free. ???Under the most likely scenario lawmakers will seek to reduce the amount paid for Edison's power lines and to increase the role of the California Public Utilities Commission in regulating the utility. ???They also will try to come up with a workable contingency plan for the state if PG&E remains adamant in its refusal to sell off its part of the power grid. ???The deal on the table is still salvageable said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. But Edison needs to understand that what it got from the governor is only a framework not set in stone. ???For his part Bryson signaled that plenty of room existed for give and take on the issue. ???We're just at the initial stage he said. We always have accepted the notion that Edison is a California regulated utility and is subject to the laws of the Public Utilities Commission.E-mail David Lazarus at dlazarus@sfchronicle.com. GRAPHIC: PHOTO Gov. Gray Davis (left) and John Bryson chairman of Edison International announced a transmission line deal on April 9. Bryson said Edison may go into bankruptcy if the deal isn't approved. LOAD-DATE: April 20 2001 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????April 20 2001 Friday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 438 words HEADLINE: Most Edison executives going without bonuses BYLINE: By GARY GENTILE AP Business Writer DATELINE: LOS ANGELES BODY: ??Senior executives at Edison International and its subsidiary Southern California Edison went without hundreds of thousands of dollars in bonuses in 2000 because of California's power crisis. ??Edison International's chairman and chief executive John Bryson was paid $ 950000 in 2000 compared with salary and bonus totaling $2.16 million in 1999. ??Stephen Frank the chairman and chief executive at Southern California Edison was paid $617000 in 2000 compared with salary and bonus totaling $1.3 million in 1999 according to the company's proxy statement filed with the Securities and Exchange Commission. ??The company also said Thursday it would not award merit increases to executives in 2001 because of the continuing crisis. ??In a similar proxy statement released Tuesday Pacific Gas and Electric Corp. revealed it also withheld bonuses for its top two executives although they did receive raises. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Edison is continuing to work with state officials and its creditors. ??The utility said its board of directors decided to withhold bonuses to all but two key executives because the financial effects of the energy crisis have overshadowed all other aspects of company and individual performance. ??The two executives who did get bonuses earned them for their roles in preserving the viability of the companies during the crisis and for retention purposes Edison said. ??Ted Craver senior vice president chief financial officer and treasurer at Edison International was paid $375000 in 2000 and received a $100000 bonus. His total compensation in 1999 was $652100. ??Harold Ray executive vice president at Southern California Edison received a salary of $390000 in 2000 and a bonus of $50000. His cash compensation in 1999 was $818400. ??PG&E paid Chairman Robert D. Glynn Jr. $945086 in salary and benefits during 2000 a 58 percent decrease from $2.26 million in the prior year according to the company's proxy statement. ??Glynn 57 received a 12.5 percent increase in his base salary but didn't get a bonus. ??Gordon R. Smith who runs Pacific Gas and Electric received a 14.5 percent raise in his base salary to $630000 but didn't receive a bonus. In 1999 Smith's compensation package totaled $1.1 million. LOAD-DATE: April 20 2001 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle SECTION: State and Regional LENGTH: 901 words HEADLINE: Top political aide discusses Bush's low-key style BYLINE: By RON FOURNIER AP White House Correspondent DATELINE: WASHINGTON BODY: ??When 24 members of a Navy spy plane crew returned to the United States after 11-days in Chinese custody President Bush was noticeably absent from their homecoming ceremonies. ??He also kept a low profile as the Senate shrank his tax-cut plan by $400 billion and had little to say about riots in Cincinnati this month. ??Such is the silent style of the new president says Bush's top political strategist Karl Rove. ??Every administration is marked in contrast to its predecessor. The previous administration felt compelled to dominate the evening news every day and the president said 'I'm focused on getting the job done' Rove said Wednesday in an Associated Press interview. ??Running a low-key presidency sets Bush apart from former President Clinton but the style has its critics. ??Some lawmakers including members of his own party said Bush could have saved more of his $1.6 trillion tax-cut plan if he had personally lobbied more lawmakers. ??Bush issued a statement expressing sympathy with police and protesters in Cincinnati but ran the risk of looking detached. ??And Rove acknowledged that there was some discussion in the White House about Bush attending the U.S. crew's homecoming to reap the public relations reward for freeing the crew. ??But the president vetoed the idea according to Rove who quoted Bush as saying I want it to be about them and I don't want to go through the discombobulation that it would require of them and their families for me to show up. ??It is not hard to imagine Clinton commanding center stage during city riots a budget battle or an international crisis but Rove said We intended to have a smaller profile than the previous administration. ??Bush's attitude is that he's not going to be measured by whether or not he gets on the evening news but on whether or not he gets progress Rove said during the 45-minute interview. ??He sat at a polished wood conference table in his West Wing office his hands folded over a memo he had discretely turned upside down. Newspapers and a Starbucks coffee mug littered his desktop. Framed photos and artwork were propped against a chair still awaiting hanging on his 89th day in the White House. ??A painting of a Texas landscape decorated one wall allowing Bush's political strategist of eight years to go on vacation whenever I'm on the phone. ??Rove is on the telephone a lot these days crafting strategies to pass the White House legislative agenda maintain GOP control of Congress in 2002 and position the president for a re-election bid in 2004. ??Bush narrowly won the White House without California's 54 electoral votes and Rove said the president could win re-election without the state but it's always nicer to carry the Golden State. ??He said the state's electricity shortage will not hurt Bush's chances in 2004 adding that the administration has done virtually everything Gov. Gray Davis has requested. ??He suggested that the state caused its own problems by not building enough power plants and failing to follow the lead of other states such as Bush's Texas to establish sound energy policies before a crisis struck. ??This has got a very human dimension to it Rove said. It's one thing to talk about power supplies. It's another thing when you talk about how it affects their jobs how it's affecting their livelihoods how it's affecting the safety of their communities and the health of their families. This is a tough issue and it ought to be a wake up call for the entire country. ??A White House task force headed by Vice President Dick Cheney is working on recommendations to address both short-term problems of soaring electricity and natural gas prices and longer-term energy supply problems focusing on producing more domestic oil and gas and building more electric power plants. ??Rove said the administration will soon unveil new conservation measures aimed at helping California ease its shortages. ??He said Bush and his political team are bringing House Republicans from politically competitive states to the White House where they discuss their districts' needs and often gain local media attention. ??Bush also plans to attend fund-raisers for House and Senate campaign committees helping the party gear up for 2002 midterm elections in which control of Congress is at stake. ??Rove also said: ??-Bush will not seek broad authority to negotiate trade treaties anytime soon allowing time to make the legislation more attractive to Democrats. You can only put so much into that pipe and we've stuffed it he said of Bush's crowded legislative agenda. The fast track authority is key to Bush's plans for a free trade zone stretching from Canada to Chile. That proposal is the focus of the three-day Summit of the Americas beginning Friday in Quebec City. ??-Americans will support Bush's environmental policies despite criticism of his decision to overturn some initiatives of the final days of the Clinton administration. Rove stopped short of accusing Clinton of setting Bush up for political troubles. I'm not certain I see a conspiracy there. I do think it's interesting that Clinton waited until the last moment to act. ??-Bush has not wavered since the campaign in his view that states should be able to opt out of minimum wage increases passed by Congress. We are not all one single labor market Rove said. GRAPHIC: AP Photo WX109 LOAD-DATE: April 20 2001 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle SECTION: State and Regional LENGTH: 727 words HEADLINE: Utility commission staff says parent company profiting from energy sales DATELINE: BOISE Idaho BODY: ??IDACORP made $66 million in profits in the past year by buying electricity on the spot market and reselling it for a higher price to its subsidiary Idaho Power Co. the staff for state utility regulators contends. ??The Idaho Public Utilities Commission staff said such profits should not come at the expense of Idaho Power ratepayers facing staggering electrical bills. ??In a report to commissioners posted on the agency's Internet site Wednesday the staff recommended Idaho Power's proposed increases for residential and commercial customers be cut by about half. ??Idaho Power seeks rate increases over the coming year totaling $227.4 million. The regulatory staff recommends a $108.7 million increase. For residential customers a requested 34-percent hike would be reduced to 16 percent. ??This is not a final decision said Jeff Beaman a spokesman for IDACORP and Idaho Power. In many cases the commissioners disagree with the staff. ??The report noted there was nothing illegal about the transactions between Idaho Power and its sister company Idaho Energy Systems. To change that the staff urged commissioners to create a mechanism that forces Idaho Power to buy electricity at the same price Idaho Energy Systems pays for it. ??The report said Idaho Energy Systems an unregulated subsidiary of IDACORP repeatedly purchased electricity on the wholesale market and then sold it to Idaho Power for a profit. ??Idaho Power officials contend the recommended policy change could financially cripple the company. It already spent $161 million buying power on the open market and cannot recover the money unless the coming year's rate is increased. ??The failure to recoup these funds could lead to liquidity problems Beaman said and that will hurt not only the company but our customers as well. ??But IDACORP paid all of its salaried staff - including Idaho Power employees - a 15-percent bonus at the end of the last fiscal year because the company had achieved record profits of $139.9 million 53 percent over the year before. ??Beaman said incentive payments have no impact on the rate request. ??Charging the higher rate between the two subsidiaries was the result of a commission order tying the price that Idaho Energy charges for wholesale electricity to the Mid-Columbia Index. The index has been pegged at unrealistic levels since the energy crisis erupted in California and fluctuates constantly. ??We are confident that the transactions were performed within the letter and spirit of the law and have not been at the expense of ratepayers Beaman said. ??Commission spokesman Gene Fadness said commissioners cannot comment on a case before them but their ultimate decision can be appealed to the Idaho Supreme Court. ??The Public Utilities Commission staff also recommended: ??- Deferring $66.1 million of Idaho Power's rate request without interest until answers are available about the company's electricity deals. ??- Deferring another $45.8 million of the request until next year when the commissioners would allow Idaho Power to collect 5-percent interest. That part of the hike was earmarked for wholesale power purchases this year - purchases that the staff believes will be much more expensive next year. ??- Cutting another $10.3 million from the increase request contending it was an error by Idaho Power's Risk Management Committee that the company planned on passing on to ratepayers. ??- Implementing a low-interest loan program to encourage energy conservation by Idaho Power customers. ??- A two-year phase-in of any rate increase ultimately approved that is substantially over 20 percent. ??- Changing residential rates to a three-tiered system to encourage savings. ??Homeowners would pay 5.52 cents per kilowatt-hour for the first 800 kwh used 6.12 cents per kwh for use between 800 kwh and 2000 kwh and 7.48 cents per kwh for use over 2000 kwh. The current residential rate of 5.2 cents per kwh. ??The staff report also took Idaho Power to task saying it was warned of the possibility of spiraling prices and power shortages as far back as 1995. ??But the company contends it did not want to build generating plants during the past decade because with electricity deregulation looming nobody knew what independent power facilities were being considered. LOAD-DATE: April 20 2001 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle SECTION: State and Regional LENGTH: 820 words HEADLINE: Legislators probe possible power natural gas collusion BYLINE: By DON THOMPSON Associated Press Writer DATELINE: SACRAMENTO BODY: ??Southern California Edison was charged about $750 million more this year for natural gas because of unchecked free-market forces an industry consultant testified. ??Paul Carpenter told the Assembly Electricity Oversight Subcommittee on Wednesday the price spikes came after the El Paso Natural Gas Co. contracted first with Dynegy and later with its own marketing affiliate El Paso Merchant Energy to control the pipeline capacity. ??Officials with El Paso and other natural gas suppliers are expected to testify Thursday that they did not illegally manipulate the market. ??The California Public Utilities Commission estimated a year ago that overcharges by the companies that control natural gas flow drove up prices by $ 100 million a year to California gas and electricity customers. ??But PUC attorney Harvey Morris said that was before last summer's price spikes which he blamed on natural gas suppliers using a monopoly to game the system. ??It's way worse than we could possibly have imagined Morris said after testifying before the subcommittee. It's obviously way higher than $100 million. ??Natural gas rates at the California border generally tracked national prices until November when they spiked as high as 11 times higher than the price of natural gas elsewhere in the nation Carpenter said. ??I have never seen gas prices like this anywhere in the world said Carpenter who has been studying the energy market for 20 years for Cambridge Mass.-based consultant The Brattle Group. The Brattle Group was hired by Edison to study the natural gas market. ??The committee is one of two legislative committees exploring whether illegal market manipulation in the electricity and natural gas markets has driven up California's energy costs. ??This is a market that is plagued by the exercise of market power Frank Wolak chairman of the California Independent System Operator's Market Surveillance Committee told the Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market. The ISO runs the state's power grid. ??However there is no law against me saying 'I'm not going to sell to you' Wolak said. Market manipulation only becomes illegal when there is collusion Wolak said and such evidence is hard to find. ??Electricity generators and natural gas suppliers say a severe supply and demand imbalance - not market manipulation - has led to higher prices. ??Everybody's busy doing investigations. They're not interested in solving the problem said Independent Energy Producers Executive Director Jan Smutny-Jones. ??Investigations are wasting everybody's time Smutny-Jones said adding that previous probes and lawsuits have uncovered no wrongdoing. He said the state's power problems came because state regulators denied utilities the chance to sign long-term energy contracts when they had the chance. ??People have been playing by the rules Smutny-Jones said. ??But the Senate committee's first witnesses are ISO officials who authored studies that claim the state paid more than $6 billion too much for power last year. ??Committee chair Joseph Dunn D-Garden Grove also has slated state Auditor Elaine Howell who last month blamed buyers and sellers for skyrocketing electricity costs. Dunn also has scheduled future testimony from state federal academic and private investigators studying the power market. ??He invited five major generators to attend the committee's second hearing next week. All five - Reliant Dynegy Williams Energy Duke Energy and Mirant - say they are eager to cooperate and clear their names Dunn said. ??Dunn asked the five for a total of 86 specific documents. If the companies feel they cannot provide documents because of legal or confidentiality concerns Dunn said he will subpoena them. ??Smutny-Jones said investigators appear to be growing desperate to blame the state's natural gas and electricity price hikes on illegal market manipulation instead of natural market forces. ??He cited Attorney General Bill Lockyer's announcement last week that any informant who helped prove wrongdoing would be entitled to a percentage of the state's recovery he estimated could range from $50 million to hundreds of millions of dollars. ??If the state's offering a $50 million reward they haven't found anything Smutny-Jones said. I don't think you're going to find the fact that anybody did anything criminal here. ??Assemblywoman Jenny Oropeza D-Long Beach said she believes otherwise after Wednesday's testimony: I think it is very clear there was some price manipulation going on. ??But Assemblyman John Campbell R-Irvine isn't sure there was anything illegal. ??There clearly are market forces at work that's evident Campbell said. Whether you make the jump to market manipulation ... I haven't seen conclusive evidence that leads me to make that jump. LOAD-DATE: April 20 2001 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Market Stack Body:: Eric I shall be glad to talk to you about it. The first three days of the next week would work for me. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Demand buy-down proposal Body:: The e-copy. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Body:: Liz It's in Stanford. We can stay at the Stanford Inn Hotel Tuesday night and leave early in the morning for Santa Fe on Wednesday. I am still waiting for Prediction to confirm their meeting on Wednesday. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Presentation to faculty and students at Berkeley Body:: FYI. I am sending Vince some materials we have used What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - May 2001 HR At A Glance Body:: Attached is the May 2001 At A Glance report. A couple of additions this month which include a section on Capital Expenditures with Pay Backs and some analysis of the recent new hire survey that we set up. Please call if you have any questions. DCL What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Next policy committee meeting Body:: We may be able to handle this specific issue outside the policy committee but I think it would be a good idea to set the next one anyway. I'm sure we'll have something we'll need to talk about. From: Sherri Sera/ENRON@enronXgate on 06/12/2001 01:17 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Next policy committee meeting Steve given yesterday's conversation toward the end of the executive committee - i.e. countries ENE will do business in - do you think we should try to set up another policy committee meeting? Jeff's schedule is pretty ugly for the rest of this month and early July but could probably do something mid-July. I'm not sure what Ken Lay's schedule looks like though. Please advise. Thanks SRS What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: New Congressional Report on California Body:: Ray Alvarez brought to my attention today a news item indicating that the Congressional Budget Office released a report earlier this week entitled Causes and Lessons of the California Electricity Crisis. The 30+ page report is available on the home page of the CBO's web site at www.cbo.gov. I have quickly read through the summary and it is largely favorable. For example the summary says: Much of the blame for California's electricity crisis attaches to the state's restructuring plan -- but not to its objective electricity deregulation. (...) But deregulation itself did not fail rather it was never achieved. The restructuring plan did not remove sufficient barriers on both the supply and demand sides of the market to allow competition to work -- in part because it was not designed to. Even without restructuring California's electric utilities would have faced a difficult challenge in meeting the demand for power and holding down prices in 2000. Consequently wholesale electricity prices were higher than they probably would have been in either a traditionally regulated market or a more fully deregulated market. Long-term solutions to California's electricity problems will most likely require three changes: removing barriers to the addition of generating capacity eliminating bottlenecks in the electricity transmission system and removing regulatory restrictions on the sale of power throughout the broad western market. On the negative side the report summary does state that some generators may also have withheld supplies at certain times to boost prices even more and the plan's auction system for the spot market appears to have created strong incentives for suppliers to bid strategically in a way that raised wholesale prices. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Legislative Update -- Two Track In The Senate and House Update Body:: We face two parallel tracks in the Senate in the coming weeks between now and the start of the congressional recess for one week on June 29th. In the Senate Energy and Natural Resources Committee we will be facing efforts by pro-price caps forces who will use the committee bully pulpit to pressure FERC into more action. This effort is led by incoming chairman Bingaman with support from Majority Leader Daschle. They are saying they will consider acting on the Feinstein-Smith price cap legislation unless FERC takes unspecified additional action by the end of this month. The new track in the Senate will be in the Governmental Affairs Committee chaired by Sen. Lieberman (D-CT). While this committee does not have the legislative jurisdiction over energy that the Energy Committee does in terms of moving legislation the Governmental Affairs Committee has broad oversight and investigatory jurisdiction over all federal agencies including FERC. New chairman Lieberman held his first press conference as chairman today and said addressing high energy prices would be a priority. In that vein the committee is expected to hold a hearing on June 13 featuring some of the economists who wrote a letter in favor of price caps last month. We are checking with the Republican staff to make sure that the anti-price cap economists (the majority of the discipline of course) will also testify. We also brief committee members and staff with our arguments against price caps and the latest publicly available market data. On June 20 the committee will hold a hearing on whether FERC has properly exercised its duties under the Federal Power Act to make sure that wholesale power rates are just and reasonable. We are going to meet with the committee majority staff but we presently expect this hearing to have political witnesses (i.e. elected officials possibly including Gov. Davis). We must keep in mind that Sen. Feinstein had earlier written to Chairman Lieberman asking for a hearing on the California energy situation including relationships between FERC and those it regulates (citing the NY Times article involving Enron and Chairman Hebert). There is at present no indicationi that either hearing will address this matter. We are as you might imagine paying close attention to this situation. Over in the House Energy and Commerce Chairman Tauzin has said he will write to FERC asking them to extend the April 26 price mitigation order to the entire west and to extend it to 24/7. He also asks FERC to see if it can implement negawatts demand reduction administratively. We are in the process of obtaining a copy of the letter which has not yet been made public. Also in the House we expect congressional committees to begin marking up portions of the President's energy legislation and related topics as the month unfolds. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Chorety Crisis Body:: Thanks for the update. Congratulations on your progress. Keith Miceli@ENRON 07/24/2000 04:18 PM To: Steven J Kean@EES Mark Palmer/Corp/Enron@ENRON Karen.Denne@enron.com cc: Karen.Denne@enron.com Subject: Re: Chorety Crisis Steve and Mark: I arrived in the US on Saturday with a good feeling about what appears to be a successful resolution of the Chorety crisis. Under Steve Hopper's leadership the Chorety spill became a non-issue by Friday. During the crisis I collaborated with my counterpart from Shell/London Michael Megarry in developing a Key Messages and Internal Q&As document (attached). At the daily meeting/conference call there was an Operations Report from the site an analysis of the day's newspaper articles (which I handled) and discussions on how to respond to media that were reporting or airing inaccurate information that was damaging Transredes' image. I also developed a Stakeholders Action Plan (attached) for the Incident Commander to use in organizing and monitoring team member actions taken in response to stakeholder concerns. The Plan was updated daily by the Transredes PR Office and given to team members prior to every meeting/conference call. The Stakeholder Report is intended to complement the Operations Report. I also want to acknowledge the support of Karen and Dennis during the early stages of the crisis. It was extremely helpful. Regards Keith What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: WSJ: PG&Es Huge losses... Body:: Eliz -- I need your group to put together a search which captures the comments of PG&E and Edison officials in trade press anlyst reports and speeches which would be inconsistent with the idea that they can now recover their shortfall. In other words when they were trying to get AB 1890 passed when they were fighting Proposition 9 when they floated their rate reduction bonds and when they talked to analysts and rating agencies I'm sure they assumed that they would live under the rate freeze and take the risk of stranded cost recovery whithin the statutory deadline. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Strengthening Enron as it grows Body:: Jeff I have prepared the attached chart for you. It captures the ideas we discussed last week. Please call when you have a chance. I look forward to talking with you. Kevin 213-926-2626 - STRENGTHENING ENRON AS IT GROWS.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL Personnel issue Body:: Michelle/Lizsette I was wondering if circumstances with Jonathan Lane (the contract Help desk person whom I mentioned to you a week or so ago) have been resolved? When we last spoke I mentioned that he went to Valeria Hope's group. I am not sure of the outcome of that visit but I will tell you that his negative attitude and general dissatisfaction on the team is becoming disruptive to the other help desk members. He is away from his desk often (having meetings which may be interviews for other positions) he has shared with the other team members his perceptions of management and his issues with us. If and when I can do so I would like to terminate him. I won't until I hear from you all and we are documenting discussions as you requested. I hope this can end soon though because this is causing real problems here. Gina What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Governors Generator Phone calls Body:: You should also check my folder California - working group ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: ABX1 70 Further Nail in Generators Coffin -- Absurdity in CA Body:: test What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: TW Gas Sales: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT PRIVILEGE Body:: In anticipation of potential litigation involving TW's operational activities please prepare an analysis for me of the reasons for TW's sale of excess natural gas at the California border. I am aware of several of these sales and have been informed that excess pressure at the border is the basic reason for them. I'd like a more specific explanation that includes the following information: 1. What are the specific pressures and volume considerations that could make it operationally necessary to sell gas at the California border? 2. What is the process that is followed to make such a determination? 3. Which individuals or groups are involved in determining whether an operational sale is necessary? 4. In what way have system operations changed since last year and how do those changes contribute to the increased frequency of such sales compared to previous years? 5. What alternatives to operational sales are considered before the decision to make a sale is reached? Thanks for your attention to this request. Please give me a call to discuss and please designate your response as Privileged and Confidential Attorney Client Privileged. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Advisory council meeting Body:: fyi ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Analysis by Academics----Why De-regulation is the right policy choice Body:: I think we need some clear indication that with Hogan on the Board this is not going to turn into a diatribe about the benefits of LMP. He's the most informed of the bunch and I doubt he would find a general work of interest (unless he can create a platform for his more detailed ideas). If it stays general I think the study is a good idea. One topic area might be to explore how politicians mess up the basic idea of deregualtion and suggest that the process needs to be handled in a more objective (and pure) fashion. Jeff Dasovich Sent by: Jeff Dasovich 03/16/2001 10:54 AM To: James D Steffes/NA/Enron@Enron cc: Joe Hartsoe/Corp/Enron@ENRON Linda Robertson/NA/Enron@ENRON Richard Shapiro/NA/Enron@ENRON skean@enron.com Subject: Re: Analysis by Academics----Why De-regulation is the right policy choice Great points. Teece---and the lion's share of the folks on the participants list---are advocates of a minimalist role for government particularly where markets are a clear and preferably option as in the case of electricity. That said I think we're going to have to make a fundamental decision about what the goal of this study would be which will determine to a large degree whether we choose to pursue it. I'll throw out for comment the notion that the study should be designed to serve one purpose: to influence the policy decision currently under debate To de-regulate or not. As such I wouldn't see issues like PJM or APX or competitive default supplier or not or divest generation with vesting contracts or retain the assets being the focus. That debate over critically important implementation details would seem to come in Round 2 once the initial debate over deregulate or not is won. To try to do both i.e. resolve in the broad policy issue AND make the case for the specific right implementation plan would arguably bog the study down perhaps interminably. And it seems that time is of the essence in the current environment. In addition unless the fundamental policy issue is won--and won rather quickly--debating implementation may be moot. Of course it will be impossible to avoid some level of dicussion on how to do it but that would not be the emphasis. In sum I'd suggest for comment that it only makes sense to proceed---particularly since time is of the essence---if we focus on the high level policy level question of to deregulate or not and address implementation in a second or follow up study. I think we should try to make a call on this swiftly since the go/no go decision would seem to flow from resolution of this issue. Best Jeff James D Steffes 03/16/2001 08:22 AM To: Jeff Dasovich/NA/Enron@Enron cc: Jeff Dasovich/NA/Enron@Enron Joe Hartsoe/Corp/Enron@Enron Linda Robertson/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron skean@enron.com Subject: Re: Analysis by Academics----Why De-regulation is the right policy choice Jeff -- It would be helpful to get some feedback prior to starting to deal with the fundamental question related to direct access for smaller customers. I would like to know Teece's perspective on the role of government in this marketplace. In addition I think that the paper must deal with the drawbacks of having mixed roles - utility default supply and competitive markets. Jim Jeff Dasovich Sent by: Jeff Dasovich 03/15/2001 03:11 PM To: Richard Shapiro/NA/Enron@Enron skean@enron.com James D Steffes/NA/Enron@Enron Joe Hartsoe/Corp/Enron@ENRON Linda Robertson/NA/Enron@ENRON cc: Subject: Analysis by Academics----Why De-regulation is the right policy choice Greetings: As I've mentioned I've been discussing with a group of academics (principally from UC Berkeley) the possibility of producing an analysis of why it makes sense to move forward toward de-regulation and makes no sense to turn back to command-and-control regulation. Clearly we're at a fork in the policy road---move forward or go back. I've (finally) gotten a proposal from the group. It's attached. Please take a look. I'd like to distribute more widely internally for comment but wanted to run it through a preliminary screen to guage whether folks think it would be useful before cluttering up folks' in-boxes with more emails to read. Few points worth mentioning: The majority of the academics that would do the report are affiliated with LECG Inc. the consulting group that I worked with prior to joing Enron. List also includes Dan McFadden UC Berkeley nobel prize winner who wrote the recent op-ed piece in the WSJ. The list also includes Hogan and Joskow and Borenstein. We could certainly exclude these folks should we choose to go forward with the analysis. However the goal is to produce a high level analysis i.e. de-regulation is good and can work command and control regulation is bad and we know that it does not work. Once the study is released (if it is pursued) the authors could tour the country testifying before federal and state bodies to advocate the virtues of de-regulation and the pitfalls of reversing course. The analysis would not be a debate over To Poolco or not to Poolco PJM etc. In this way including folks like Joskow and Hogan could offer the added benefit of creating a Nixon goes to China scenario. Please take a look at the list of participants. Again we can add to and subtract from the list. Laura Tyson would be one of the two project leaders. (The other would be David Teece Chairman of LECG.) None of the folks on the list occupies either extreme of the political spectrum. It's a mix of D's and R's who are arguably centrist economist and strong believers in markets (I won't vouch for Joskow and Hogan). The idea would be to get a wide array of industry participants from across the country to support the project. This is for two reasons: 1) the more diverse the group supporting the effort the greater the credibility and 2) they are asking for about $1 million to do the study. If you think it would be useful to pursue the study as part of our national campaign to minimize the damage created by California I would like to start immediately to approach trade associations companies customers etc. nationwide to garner support for the project. Let me know if you think the effort would be worthwhile. Appreciate your comments. Best Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Philippe Body:: Yes Phillippe left to join a firm in New York -- I don't know who. Christopher Culberson on 06/26/2001 02:42:53 PM To: skean@enron.com cc: Subject: Philippe Steven I hear Philippe is leaving for Putnam any truth to this? I've been unable to contact him directly. Thanks in advance. Best Regards Chris M. Culberson cmculbe@us.ibm.com (281) 556-8104 What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fw: Tagging issue at NERC Security Subcommittee tomorrow Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I got a voicemail fro Ken. He would be happy to meet with Freeman. He is willing to work on other times but suggested the following After 3:00 on May 2nd (right after Ken's speech to the RGA) or late the day before or in the morning of the second (to do this though he would have to cancel his speech to the Texas Governor's business council but he is willing to do this if necessary) His least preferred alternative in this general time frame would be early morning on the third. Jeff -- could you coordinate with Rosie to get the time and place nailed down? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Multi-talented Recruit Body:: nan What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Red Herring Article Body:: Hap -- could you provide a response and get it to Meredith. I'd like to correct this. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: potential media calls Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FTC Staff Report on Electricity Restructuring Body:: Yesterday the Federal Trade Commission issued a staff report on electricity restructuring issues. It is an update of the July 2000 report done at the request of House Energy Chairman Tauzin and Subcommittee Chairman Barton. They requested the report be updated. A summary of the report and the full 80+ page text is on the FTC web site at www.ftc.gov on the upper left side of the home page. I read the summary and will read the balance. So far so good. It basically says that even states that have opened up to retail competition are in transition with a hybrid of regulation and competition thus the expected benefits of competition have not yet emerged. However the report states that nothing to date indicates that competition once the transition period is over will not produce additional benefits for consumers. The report's major conclusion is that competitive wholesale markets are important to achieving effective competition in retail markets. The summary includes something that sounds promising on RTO policy saying And as wholesale and retail markets become regional governing policies and jurisdictional approaches also must move in that direction for wholesale and retail competition to be successful. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Comments on Judge Wagners Proposed Recommendation Body:: My comments are attached. I think the pleading is well written but as you'll see from my comments I believe we should be incorporating more of the arguments from the previous pleading. Ray Alvarez 07/09/2001 07:14 PM To: James D Steffes/NA/Enron@Enron cc: Jeffrey T Hodge/Enron@EnronXGate Robert C Williams/Enron@EnronXGate Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Alan Comnes/Enron@EnronXGate Jeff Dasovich/NA/Enron@Enron Susan J Mara/NA/Enron@ENRON Robert Frank/NA/Enron@Enron Sarah Novosel/Corp/Enron@ENRON dwatkiss@bracepatt.com Subject: Comments on Judge Wagner's Proposed Recommendation As you may be aware the Chief Judge informed the parties to the settlement proceeding this afternoon that he intends to recommend to the Commission that it employ the June 19 rate methodology for the refund period from October 2 forward. Attached are draft comments that Sarah Novosel and I propose to submit to the Judge and his legal staff tomorrow. While we would like to convince the Judge that the June 19 methodology is not appropriate we also provide a fallback approach. Please review the comments (they are only 4 pages) and send your comments to us. We plan to submit the comments tomorrow. Thanks Ray and Sarah What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Fri 7/6: Two more say Duke withheld power: The company says it was responding to the state grid operator Sac Bee Fri 7/6: Lockyer seeks SEC investigation of PG&E's financial transfers LA Times Fri 7/6: California State Seeks SEC Probe of PG&E Transfers LA Times Fri 7/6: THE NATION Little Progress on Energy Rebate Judge Hints SF Chron Fri 7/6: Davis energy team denied pay State controller says work for Edison is a conflict of interest SF Chron Fri 7/6: Ex-staff speaks out against Duke Two more charge prices manipulated SF Chron Fri 7/6: Vallejo to produce its own energy Conservation generators expected to make city self-sufficient Mercury News Fri 7/6: SEC asked to see if PG&E Corp. violated law with subsidiary Mercury News Fri 7/6: Judge may speed up electricity refund talks Mercury News Fri 7/6: Davis keeps state addicted to fossil fuels (Commentary) Chicago Trib Fri 7/6: Economics fuels power solution in California Price relief gains political support Wash. Post Fri 7/6: California Changes Stance on Refunds Two Sides Far Apart In Energy Talks WSJ Fri 7/6: U.S. Hearing Officer May Impose Pact To End California Power-Overcharge Case Two more say Duke withheld power: The company says it was responding to the state grid operator. By Kevin Yamamura Bee Capitol Bureau (Published July 6 2001) Two more former workers from a Duke Energy power plant came forward Thursday to bolster recent claims by colleagues that the power generator withheld production to drive up prices. But Duke attributed witness accounts of fluctuating generation to instructions from the state's transmission-grid operator. Richard J. Connors an auxiliary operator and E. Robert Edwards an electrician said generation units at Duke's Chula Vista plant sat idle during emergency periods for no apparent reason. Three of their former co-workers -- two mechanics and a control room operator -- told lawmakers two weeks ago that Duke had disposed of new parts and varied its production. While that testimony drew significant attention it was countered Monday by a report released by the state's Independent System Operator that showed the ISO had in fact ordered Duke's up-and-down output Jan. 16-18. On Thursday the Charlotte N.C.-based company leaned on the ISO report in its defense. The ISO could have dispatched those units at will said Duke spokesman Tom Williams referring to unused equipment. But Lt. Gov. Cruz Bustamante who has filed a lawsuit against generators contended that the ISO had based its orders on Duke's dubious bidding history. These ISO orders came only after Duke had continuously manipulated the market with price-gouging schemes forcing the ISO to regulate production Bustamante said. Connors and Edwards each worked more than 20 years at the South Bay plant in Chula Vista. For most of that time the plant was owned by San Diego Gas & Electric. Two years ago Duke purchased South Bay and retained Connors and Edwards under state-mandated agreements that ended in April. Edwards said that during power blackouts in January he saw a 225-megawatt unit off-line. Other units he said were operating far below capacity. Our No. 1 priority in life was to make money Edwards said. Williams rebutted the claims as observations from those who did not have the complete picture. It's dead on dead true that there are times when that plant is not running at full capacity and there is a Stage 3 Williams said. There may be blackouts in San Francisco. But the reason why it's not running is because the power can't move up Path 15 (a north-south bottleneck). Bustamante however maintained that Duke has continued to manipulate the market calling Connors and Edwards the tip of the iceberg in the price-gouging investigation. State Sen. Joe Dunn D-Santa Ana chairman of the Senate committee investigating price manipulation said Connors and Edwards may testify before lawmakers after further evaluation. Dunn added that his committee has talked to potential whistleblowers from other power generators who said they have seen production decreases and suspicious activities. It is undetermined whether they will testify he said. The Bee's Kevin Yamamura can be reached at (916) 326-5542 or kyamamura@sacbee.com. Lockyer seeks SEC investigation of PG&E's financial transfers By Ed Fletcher Bee Capitol Bureau (Published July 6 2001) State Attorney General Bill Lockyer on Thursday asked the federal Securities and Exchange Commission to scrutinize financial transfers made to PG&E Corp. from its subsidiary that has filed for bankruptcy protection. SEC scrutiny is essential to protect the public interest ratepayers and the people of the state of California Lockyer said in a prepared statement. Charges that PG&E Corp. hastened the bankruptcy filing of Pacific Gas and Electric Co. have been made before responded Greg Pruett a vice president of PG&E Corp. That is an issue that has been investigated multiple times by the Public Utilities Commission earlier this year by an Assembly oversight committee and in each of these audits there has been no conclusion that the transfers were inappropriate or that they were injurious to PG&E Co. Pruett said. In its filing with the SEC the attorney general's office said that without meaningful review by the SEC it cannot be determined what impact the transfer of assets ... may have on the financial condition of the bankrupt utility. An SEC spokesman said the commission has yet to examine the petition. Among other concerns raised by Lockyer's office is the transfer of more than $4 billion from 1997 to 1999 to PG&E Corp. from PG&E Co. The majority of the $4 billion came from the sales of PG&E power plants as was required by deregulation. The bulk of the money went to pay debt that was incurred to actually build those plants Pruett said. The rest of the transfers were to pay stockholder dividends he said. PG&E filed for Chapter 11 bankruptcy protection in April after having run up $6.6 billion in debt. The Bee's Ed Fletcher can be reached at (916) 326-5548 or efletcher@sacbee.com. Business Financial Desk California State Seeks SEC Probe of PG&E Transfers NANCY RIVERA BROOKS ? 07/06/2001 Los Angeles Times Home Edition Page C-2 Copyright 2001 / The Times Mirror Company California Atty. Gen. Bill Lockyer on Thursday asked the Securities and Exchange Commission to investigate PG&E Corp. for potential abuses of its responsibilities as a utility holding company. At issue is a series of transactions over the last several years in which PG&E Corp. transferred funds from its utility Pacific Gas & Electric Co. which now is operating under Bankruptcy Court protection. The money--more than $4 billion since 1997--flowed to the parent company and to unregulated sister companies of the utilities. The transfers have been scrutinized by the California Public Utilities Commission and the state Legislature with no finding of wrongdoing said PG&E Corp. spokesman Greg S. Pruett. The SEC currently exempts PG&E from almost all requirements of the Public Utility Holding Company Act because the San Francisco utility operates primarily within California . That law regulates transactions between holding companies and their utility subsidiaries. Lockyer wants the SEC to withdraw PG&E's exemption citing $13 billion in PG&E assets outside of California . All the primary evils addressed by PUHCA are relevant to PG&E Corp. Lockyer's petition to the SEC stated. In Bankruptcy Court on Thursday PG&E said it is close to reaching an agreement with Calpine Corp. to pay more than $267 million it owes the San Jose-based power generator and to preserve contracts for 453 megawatts of relatively cheap electricity . In all PG&E buys about 2600 megawatts of electricity from nearly 25 alternative generators which are seeking repayment and release from their contracts through Bankruptcy Court. National Desk THE NATION Little Progress on Energy Rebate Judge Hints RICARDO ALONSO-ZALDIVAR ? 07/06/2001 Los Angeles Times Home Edition Page A-30 Copyright 2001 / The Times Mirror Company WASHINGTON -- The federal mediator seeking a settlement for billions of dollars in alleged electricity overcharges in California signaled Thursday that the talks are in trouble and analysts said hope for a deal seems to be fading. Curtis L. Wagner Jr. chief judge of the Federal Energy Regulatory Commission said he may issue a report on the closed-door talks as early as today if he sees no progress. The judge will perhaps issue a preliminary assessment of the talks said Tamara Young-Allen a spokeswoman for FERC. He will do this only if he feels the talks aren't moving along as he sees fit. Originally a preliminary report from the judge was not part of the plan. Wagner had previously said all sides would labor in private through the weekend to try to get a deal by Monday's midnight deadline. If that failed the judge said he would take seven days to craft a proposed settlement for FERC's governing board. Kit Konolige a power industry analyst with Morgan Stanley in New York said Wagner's announcement on Thursday amounted to a judicial distress signal. The judge wouldn't say something like this if the parties were close to a settlement said Konolige. I suppose he may be trying to jump-start things but I think most people believed the sides were so far apart going into the talks that it seemed like a long way to go to reach a settlement. Although Wagner has imposed a gag order on participants several people with knowledge of the negotiations said Thursday that major power generators and California officials have not budged from dug-in positions since the talks began last week. They also said the judge is extremely frustrated with the state and with several large power suppliers. California is demanding $9 billion in refunds. According to sources the generators have offered less than $1 billion. And some major power sellers are insisting they do not owe anything. Many experts say California has little hope of obtaining the $9 billion since only $5.4 billion of that is attributable to sellers under FERC's jurisdiction. On the other hand it seems clear from statements by FERC commissioners that the board is prepared to extract significant refunds from generators. Wagner is said to be probing for a compromise figure between $1 billion and $9 billion. It could take the form of a mix of cash payments and discounts on long-term contracts for power. FERC's governing board ordered Wagner to hold the talks to see if a compromise could be struck on three big issues: refunds guarantees that generators will be paid and ways to shift more of the state's power purchases to long-term contracts. The board also made clear that it would impose its own settlement if the state and power sellers were unable to come to an agreement. Wagner said Thursday that if he issues a preliminary report today he will give all the parties a chance to respond publicly on Monday. Such a report might embarrass some of the key players since Wagner is known for his plain-spoken conclusions. The judge would then prepare a settlement recommendation for the FERC board by July 16. However he also said he is willing to work through the weekend to reach a settlement if it appears within striking distance. The talks are in a large hearing room on the second floor of the FERC building near Washington's Union Station. Access is strictly controlled and special badges have been issued to the more than 140 lawyers participating. Some people with knowledge of the negotiations said Wagner's threat to issue a report may be a bid to see if one of the parties will make a move. It was like a shot across the bow said one source. * RELATED STORIES Energy savers: College students help businesses cut waste. B1 SEC probe: The state urges a review of PG&E fund transfers. C2 'No' vote: Reliant Energy workers reject union representation. C2 Davis energy team denied pay State controller says work for Edison is a conflict of interest Robert Salladay Chronicle Sacramento Bureau Friday July 6 2001 2001 San Francisco Chronicle URL: N198197.DTL Sacramento -- State Controller Kathleen Connell is refusing to pay two former Clinton- Gore campaign operatives hired by Gov. Gray Davis even though one of the consultants dropped his Southern California Edison contract amid conflict-of- interest allegations. Mark Fabiani and Chris Lehane were collectively known as the Masters of Disaster for their work in the Clinton White House during various federal investigations. They also worked for Vice President Al Gore during the 2000 presidential campaign. Because of their work for Davis Connell says the contract Fabiani and Lehane signed with Edison is a conflict of interest under state ethics rules. Davis is negotiating with Edison on a bailout for the utility. Late last week at the bottom of a press release Davis announced that Fabiani was no longer a communications consultant because his work had been successfully implemented. Lehane on the other hand has dropped his contract with Edison and signed a new agreement with Davis. Lehane's new contract includes reimbursement for travel and meal expenses which he didn't have before and requires him to work a maximum of 66 hours a month at $150 an hour. His total payments are capped at $76000 for work from June 26 to Nov. 20 2001. In his release Davis said Lehane would be paid the same amount as former communications director Phil Trounstine about $9900 a month. But Connell like Davis a Democrat said Trounstine undoubtedly worked more than 66 hours in a month for his $9990. We don't intend to be paying it Connell said of the contract for both men. They represented Southern California Edison. You have to have a singular relationship with the state of California and not show a conflict. Previously the Davis administration said there was no conflict because Edison and Davis wanted the same things out of their negotiations. Earlier this week Davis spokesman Steve Maviglio said attorneys had different opinions over whether the two consultants had violated ethics rules. Davis spokeswoman Hilary McLean said the governor had signed an executive order allowing him to enter into consulting contracts with anyone he believed could help him solve the state's energy crisis. She said Lehane had been working full-time on public policy even though his contract caps his salary. The National Tax-Limitation Committee a Sacramento group that mostly monitors legislation sued last month alleging that Fabiani and Lehane were violating the state Political Reform Act because of the Edison contract. In a recently filed disclosure statement Fabiani also listed more than $10 000 worth of consulting work for Cisco Systems another company that frequently brings issues before state authorities including Davis. The state Fair Political Practices Commission also is looking into a complaint filed by GOP Secretary of State Bill Jones that Fabiani and Lehane violated state ethics rules. E-mail Robert Salladay at rsalladay@sfchronicle.com. 2001 San Francisco Chronicle ? Page?A - 3 Ex-staff speaks out against Duke Two more charge prices manipulated Robert Salladay Chronicle Sacramento Bureau Friday July 6 2001 2001 San Francisco Chronicle URL: N122949.DTL Sacramento -- Two more former employees at Duke Energy's Chula Vista power plant came forward yesterday with allegations that the company manipulated the energy market to drive up prices although they offered no hard proof and little new information. Their accusations bring to five the number of Duke plant workers who say they observed suspicious behavior including the disappearance of parts needed for repairs the idling of generators for no apparent reason and continual stopping and starting that critics of Duke suspect was designed to withhold power and artificially increase prices. E. Robert Edwards a 50-year-old electrician related one conversation with a Duke foreman sometime in January that prompted suspicion. I asked the foreman why Unit 4 wasn't running Edwards said yesterday at a press conference. We had a 225-megawatt generator sitting there and he just shrugged his shoulders and said 'I really can't tell you. I'm not privy to that information.' State lawmakers have been focusing on whether Duke manipulated prices during three days in January when the company at one point offered a single megawatt of power for a record-shattering $3880. Duke says it was following orders from the Independent System Operator which runs the state's power grid when it repeatedly turned its generators on and off during those three days. An ISO memo recently released by Duke confirms the company's contention it was under orders. But January logs from the ISO and the generators don't offer an explanation for every allegation of price manipulation since Duke has refused to release a detailed list of the prices it offered and paid during that period. The two workers who came forward yesterday Edwards and 46-year-old Richard J. Connors both worked more than 20 years in the business. They left the South Bay Plant in Chula Vista in April two years after Duke purchased it from San Diego Gas & Electric as part of deregulation. SOME SHIFTS UNPOPULAR It is true units were taken offline mostly on the weekends for whatever reason said Connors a former auxiliary operator. It got to the point as an operator that you were dreading working swing shifts on Sunday or graveyard Monday morning because you knew you were going to be running around putting units back online. Edwards said he had seen a company warehouse eventually emptied of parts that are used to repair broken generators although he didn't know where the parts went. Forcing a longer wait for repair parts was designed to dry up the power supply and push prices higher lawmakers and other investigators suspect. Edwards however admitted the warehouse was being cleaned out even when SDG&E ran the plant. Duke contends the workers weren't familiar with Duke's inventory system and couldn't possibly know why parts were being moved. Duke and other energy companies are facing scrutiny by two legislative committees a 19-member Sacramento County grand jury state Attorney General Bill Lockyer the California Public Utilities Commission and federal regulators. BUSTAMANTE ALSO SUING Lt. Gov. Cruz Bustamante who introduced Edwards and Connors yesterday also is suing a variety of generators in state court for alleged price manipulation and bad business practices. He said Edwards and Connors reiterated what we've know all along -- Duke has been gouging California consumers through its use and abuse of the South Bay Plant. Duke offers a variety of defenses for its actions during the three days in January and throughout the energy crisis. Tom Williams a spokesman for Duke said Edwards and Connors had offered nothing new yesterday. Beyond the ISO's 37 separate orders to stop and start generators during the three days in January Williams said state air regulations required the company to shut the plant at certain times because it was running out of emissions credits that limit the amount of air pollution it can put out. Duke which controls about 5 percent of the state energy market also contends the state's power transmission lines can't always handle an increase in load. Yes it's true there are times when that plant is not running at full capacity and there is a Stage Three (alert) and there may be blackouts in San Francisco Williams said. The reason why it's not running is the power cannot move up Path 15 the transmission line bottleneck near Los Banos. E-mail Robert Salladay at rsalladay@sfchronicle.com. 2001 San Francisco Chronicle ? Page?A - 3 Vallejo to produce its own energy Conservation generators expected to make city self-sufficient Jason B. Johnson Chronicle Staff Writer Friday July 6 2001 2001 San Francisco Chronicle URL: N138966.DTL Vallejo leaders looking to escape mounting gas and electric bills are planning to build enough new power generators that the city government will be self-sufficient when it comes to energy. City officials said they believe that Vallejo is the first city in the nation to take such an approach. This is going to be a showplace said Scott Sossen the chief executive officer of Edge Capital Group a funding agency based in Orange County. Edge will be supervising the work along with O'Hara Energy Corp. of Nevada. The plan comes at a time when the city expects to see its energy costs double next year if it continues buying its power from PG&E. It couldn't be more timely said Mayor Tony Intintoli. Vallejo leaders are in the process of contracting with private business to build new wind solar and microturbine generators. Construction of a one- megawatt solar generator could start within 30 to 60 days. Conservation is also part of the plan and energy-efficiency improvements are already under way at Vallejo City Hall and the fire and police stations. City officials hope to add enough sources of power generation to make all city offices -- which consume about 10 megawatts a year -- self-sufficient by the end of the year. The Vallejo City Council gave tentative approval to the project late last month and will continue its discussions on the plan next week. Vallejo taxpayers won't have to pay any money in advance because Edge will finance the project's first $50 million in capital costs. In return a portion of the city's projected financial savings will be shared with the Edge and O'Hara. This is a fairly sizable project said Kevin Chambers the chief executive officer at O'Hara. Energy-efficient capital is difficult to find because it is such a new field. O'Hara is installing high-tech energy management systems at all city-owned property to reduce energy consumption. Final sites for the construction of new wind solar and microturbine generators have not been chosen. In recent years the energy bill for Vallejo city government has averaged between $2 million and $3 million per year. That includes the police and fire departments City Hall and water-pumping stations. Vallejo is part of a group of 50 local governments in Northern California that pooled their resources to buy electricity and natural gas keeping prices down. But the group's current contract expires Dec. 30. As a result the city expects its energy bill to double next year from 9.2 cents per kilowatt hour to 20 cents per kilowatt hour. It's been very positive what we've been doing and it hasn't cost us anything said City Manager David Martinez. We're going to be very optimistic that this is going to be a good thing for the city. City officials hope to eventually extend the plan to Vallejo's 4500 businesses and 37000 households. E-mail Jason B. Johnson at jbjohnson@sfchronicle.com. 2001 San Francisco Chronicle ? Page?A - 23 SEC asked to see if PG&E Corp. violated law with subsidiary Published Friday July 6 2001 in the San Jose Mercury News BY JENNIFER BJORHUS Mercury News California Attorney General Bill Lockyer asked the federal Securities and Exchange Commission on Thursday to step in to investigate whether PG&E Corp. violated federal law in taking billions of dollars from its bankrupt subsidiary. ``SEC scrutiny is essential to protect the public interest ratepayers and the people of the state of California'' Lockyer said in a statement. More than $4 billion flowed from the Pacific Gas & Electric utility to parent PG&E Corp. from 1997 to 1999 according to Lockyer's petition representing nearly 70 percent of the cash that flowed to the parent company during that period. PG&E Corp. spent $2.7 billion to buy back its stock $1.5 billion to pay dividends to shareholders and invested $800 million in its other subsidiaries according to the petition filed Thursday in Washington. Those figures are similar to figures from a state-ordered independent audit of PG&E Corp.'s finances released in late January. By moving assets from the utility to other businesses the company potentially harmed the utility and violated the federal Public Utility Holding Company Act in several ways according to the petition. The SEC is the nation's top cop for publicly held companies. But the commission has not reviewed PG&E Corp.'s asset movements saying the company is exempt from scrutiny under the Public Utility Holding Company Act because it's mainly a California operation and such intrastate operations are exempt. The attorney general's office argues that PG&E Corp. with more than $13 billion of its assets outside the state can no longer claim it is primarily an intrastate company. The SEC should step in it argues. The petition surprised PG&E Corp. officials who said they had no idea the attorney general's office had an issue with the company's exemption from the federal law said company spokesman Greg Pruett. Pruett said PG&E Corp.'s actions were appropriate because the federal utility law only applies if a company has one or more of the following activities in several states: electric transmission and distribution gas distribution or utility-owned generation. ``We have none of those things except in California'' Pruett said adding that the National Energy Group a PG&E Corp. affiliate ``has natural gas transmission but no distribution.'' ``The power plants that NEG owns or operates are not part of a utility and thus aren't regulated by PUCHA and it has an energy-trading arm that is also not regulated by PUCHA'' he said. The petition further asks the SEC to order PG&E Corp. to cooperate fully with the California Public Utilities Commission. The state commission is investigating whether PG&E Corp.'s corporate structure and its relationship with its bankrupt utility violate state utility regulations. The petition states it expects a response from the SEC within 60 days. But SEC spokesman John Heine said there's no statutory deadline for a response. He said he had not seen the petition and could not comment. Contact Jennifer Bjorhus at jbjorhus@sjmercury.com or (408) 920-5660. Judge may speed up electricity refund talks Published Friday July 6 2001 in the San Jose Mercury News BY RICARDO ALONSO-ZALDIVAR Los Angeles Times WASHINGTON -- A federal mediator seeking a settlement for billions of dollars in alleged electricity overcharges in California signaled Thursday that the talks are in trouble. Curtis L. Wagner Jr. chief judge of the Federal Energy Regulatory Commission said he may issue a report on the closed-door talks as early as today if progress is not made. ``The judge will perhaps issue a preliminary assessment of the talks'' said Tamara Young-Allen a FERC spokeswoman. ``He will do this only if he feels the talks aren't moving along as he sees fit.'' Wagner had previously said all sides would labor in private through the weekend to try to get a deal by the deadline of Monday at midnight. If that failed the judge said he would take seven days to craft a proposed settlement for FERC's governing board. California is demanding $9 billion in refunds. According to sources the generators have offered less than $1 billion. Wagner is said to be probing for a compromise figure that could take the form of a mix of cash payments and discounts on long-term contracts for power. Davis keeps state addicted to fossil fuels Published Friday July 6 2001 in the San Jose Mercury News BY JOE COSTELLO BEFORE this year's energy ``crisis'' Gray Davis wanted to be known as the education governor. However Davis and his advisers' energy teachings have revealed alarming failures setting back state energy policy not one or two years but one or two decades. While George W. Bush proposed an energy policy tied to fossil fuels disproportionate building of centralized generation plants too little energy efficiency lowering environmental standards and increased global warming emissions Davis enacted it. First Davis has tied the state for the next decade or longer to contracts with facilities that are exclusively fossil fuel generation. Second he has encouraged an unprecedented surge in the building of new centralized fossil fuel plants. Finally he has pushed the lowering of environmental standards to increase production from the dirtiest fossil fuel facilities. The state's new energy purchasing department has spent zero on renewable generation. David Freeman the governor's energy czar giving lip service to alternatives has negotiated close to $50 billion in long-term contracts with fossil fuel generators. By comparison the governor has authorized investment of only $13 million in expanding solar generation. Photovoltaic cells produce electricity directly from the sun's energy offering a clean efficient solution to the state's future peak energy demand. While the governor talks a lot about energy efficiency the state's funding of demand programs is about 1 percent of the funding for supply. Most egregious the vast majority of state energy efficiency money is funneled back to the utilities. While environmentalists deride the Bush administration proposals in California organizations such as the Natural Resources Defense Council actively support Davis' fossil fuel energy policy. The Davis energy policy has stuck California with the same old electric system for at least the next decade. Money has literally been burned instead of invested in innovation and creation of a cleaner and more efficient system. The best hedge against price spikes is a diversity of fuel sources unfortunately California's electric system is now tied to an even greater degree to fossil fuels. After binding the state economy to the past the Davis end game is logical. Davis and his energy advisers want to spend tens of billions of dollars for the utilities' restoration -- the very companies that for so long stifled industry innovation and remain most responsible for California's energy fiasco. There is still an opportunity to make the best out of a bad situation. Instead of bailing out the utilities they should be dismantled and sold off. A combination of a dozen or so local government and publicly owned companies should be created with a goal of innovating the industry. An auction could be held that would sell customer blocks and with it the state's long-term contracts. Choice should be reinstated with the lifting of the suspension on direct access to alternative suppliers. Instead of moving the state to the next level of energy development the education governor's remedial energy teachings will force California to repeat its energy lessons. Joe Costello is an energy and communications consultant based in Larkspur. Business Economics fuels power solution in California Price relief gains political support Robert Gibbons BridgeNews ? 07/06/2001 Chicago Tribune North Sports Final N Page 3 (Copyright 2001 by the Chicago Tribune) Political pressure coming from the U.S. Congress and politicians from Western states seems to have influenced the approach to the power crisis despite opposition to price caps in the Bush administration. The Federal Energy Regulatory Commission in June expanded price mitigation measures on wholesale electricity sales in California during periods when blackouts are possible. The measures encourage generators to sell power into the state to prevent emergency alerts from being declared which trigger price caps. The move came with support growing in Congress especially among representatives of Western states on both sides of the aisle for legislation that would have capped wholesale prices in the region. The macroeconomic force may have been the difference between the $7 billion cost of power for California in 1999 and its rise to approximately $27 billion in 2000. The cost is estimated to reach between $50 billion and $70 billion in 2001. With that kind of money at stake suddenly the concern becomes less a question of who is responsible for the problem but rather how it can be solved quickly to prevent harsh political consequences. California Atty. Gen. Bill Lockyer has conducted an investigation into the actions of power generators and offered multimillion dollar rewards to whistleblowers to provide evidence of price manipulation by independent power generators. The state is seeking refunds of $8.9 billion the amount it estimates independent power generators overcharged California 's troubled utilities. The U.S. General Accounting Office has released a report criticizing the FERC for not finding evidence of power generators using plant outages to drive up prices in California . FERC's [February] study was not thorough enough to support its overall conclusion that audited companies were not physically withholding electricity supply to influence prices the GAO found. Of the major independent power generators and marketers like Reliant Energy Dynegy Duke Energy and Enron only Williams and its CEO Keith Bailey came out in April in favor of some sort of short- term price relief for California . The political dynamic out there is much more Draconian than what we're proposing Bailey told analysts in April defending Williams' position supporting some limited short-term price mitigation. What he was worried about was California Gov. Gray Davis using eminent domain powers to take over power plants and the state setting up a public power authority to build state-owned plants. Financial California Changes Stance on Refunds Two Sides Far Apart In Energy Talks Peter Behr ? 07/06/2001 The Washington Post FINAL Page E01 Copyright 2001 The Washington Post Co. All Rights Reserved California officials have abruptly shifted tactics in their attempt to recover billions of dollars in alleged overcharges for electricity saying they may reduce their demands for huge refunds if generators renegotiate $43 billion in long-term electricity contracts that the state signed this year. Gov. Gray Davis (D) said part of the $8.9 billion in refunds the state is seeking could be offset by reductions in energy prices in the long-term contracts whose costs have become a growing political embarrassment for Davis. We've made suggestions we've offered various ways in which people could get us $8.9 billion Davis told the San Jose Mercury News in a report yesterday. You can renegotiate our existing contracts and save us money. However you want to do it it's just got to net out close to $8.9 billion. The new offer was introduced this week into the closed negotiations over a California settlement being conducted in Washington by Federal Energy Regulatory Commission Judge Curtis L. Wagner Jr. according to sources close to the negotiations. Yesterday Wagner said he may issue his own preliminary finding today on the amount of overcharges if California officials and the generators cannot reach a compromise. What I'm trying to do is get people in a settlement mood Wagner told reporters. In the event we're unable to do that [Friday] at some point I may offer a preliminary assessment. The settlement conference is set to conclude on Monday. Wagner FERC's chief administrative judge has been trying to push both sides toward a compromise that would resolve the huge energy pricing controversy. Mountainous energy prices have bankrupted California 's largest utility drained billions of dollars out of the state treasury and put Davis at sword's point with generators that help keep the state's lights on. Last Friday Wagner rebuked Davis's chief representative Michael Kahn chairman of California Independent Grid Operator -- the state's power grid manager -- indicating that the state's demand for nearly $9 billion in refunds from power generators and marketers was too high sources said. Wagner's settlement conference which has involved more than 100 lawyers for all sides is closed to the public and media. Wagner complained last month that Kahn was following a political agenda and his lack of independence in the negotiations was such a joke that the parties might as well wear clown suits according to a Dow Jones report confirmed by sources close to the talks. But he has also criticized the generators and power marketers led by Reliant Energy Inc. Williams Energy Services Duke Energy and Southern Co. for failing to make serious settlement offers these sources said. The suppliers have offered to refund $600 million provided the state is able to call off various California lawsuits demanding far larger refunds sources said. Wagner's leverage is his ability to propose his own refund figure to FERC's commissioners. FERC has tentatively called for $124 million in refunds but now is taking a harder line on preventing a new escalation of California 's electricity prices this summer and is likely to be receptive to a higher refund figure some energy analysts believe. Davis's tactical change offering to make the long-term contracts part of an overall settlement comes amid growing criticism of what the state will have to pay for energy under those deals. California 's energy calamity stemmed in large part from its failed deregulation plan which relied heavily on short-term power purchases at volatile spot market prices. When energy costs shot upward last summer so did the state's electricity bills. In response Davis's aide S. David Freeman and his staff began negotiating long-term power contacts with suppliers. The $43 billion in deals signed so far would require the state to pay about $70 per hour for a megawatt of power for a large part of the electricity it will need over the next 10 years. That's well under the average of $250 per megawatt-hour that the state was paying at the beginning of this year but above current power prices -- and considerably higher than what electricity may cost in the next decade energy analysts say. A new agreement to lower those contract prices could relieve political pressure on Davis and focus settlement negotiations away from the state's controversial demand for the $8.9 billion refund. Davis will argue that reducing future power charges that his administration negotiated should count as a refund because the deals were reached under commercial duress according to sources close to Wagner's negotiations. Industry supporters say Davis's refund figure is impossible to justify. There's no benchmark for what a fair and reasonable price should be said Michael Zenger California director of Cambridge Energy Research Associates. The state's advocates counter that if FERC enforced a just and reasonable standard for power prices based on operating costs and a generous profit the overcharges by all sellers could easily reach the $9 billion figure. It's not rocket science but it does require the regulators to regulate said Frank Wolak a Stanford University economist who heads an oversight committee for the California grid. Those polar-opposite views have left both sides in Wagner's conference room billions of dollars apart as the talks approached their final weekend sources said. http://www.washingtonpost.com Contact: http://www.washingtonpost.com Politics & Policy U.S. Hearing Officer May Impose Pact To End California Power-Overcharge Case By Richard B. Schmitt ? 07/06/2001 The Wall Street Journal Page A10 (Copyright (c) 2001 Dow Jones & Company Inc.) WASHINGTON -- With settlement talks apparently stalled a federal hearing officer said he may propose his own solution to settle billions in alleged electricity overcharges tied to the California power crisis. Curtis L. Wagner Jr. said he was still optimistic California officials and several power companies could come to terms on $8.9 billion in disputed electricity charges the state has incurred over the past year. Absent more-meaningful progress he said he would offer his own preliminary assessment and recommendation as soon as today. In that event Mr. Wagner also said he would convene a hearing Monday where the two sides would be given the chance to comment on his plans. Mr. Wagner has previously indicated he feels California is due some refunds but far less than the total the state claims. California is also indebted to the power companies for billions in previous deliveries those debts could at least partially offset any refunds. Mr. Wagner has also said long-term contracts that would insulate the state from the sort of price shocks it has experienced over the past year could be part of any resolution. An administrative-law judge with the Federal Energy Regulatory Commission Mr. Wagner was named by the panel two weeks ago to broker a peace of the overcharge dispute. Commission officials have given the parties until Monday to reach an agreement behind closed doors. After that absent a settlement the commission has ordered Mr. Wagner to report back with his findings and recommendations within a week. At that point the commission has said it will impose a settlement of its own liking. The overcharge issue has been a flash point in the California debacle with the state's governor Gray Davis calling the energy companies pirates and marauders. The industry considers itself a scapegoat for a bungled state deregulation effort. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Hendricks Body:: I think we should let people in the legislature know about this and see if one or more of them can get their hands on it. From: Richard B Sanders@ECT on 05/06/2001 10:40 AM To: James D Steffes/NA/Enron@Enron Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Jeff Dasovich/NA/Enron@Enron Sandra McCubbin/NA/Enron@Enron cc: Subject: Hendricks Any thoughts? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Firsst article attached refers to the 1946 Nebraska case I mentioned to you= =20 in DC What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fw: CONFIDENTIAL AND PRIVILEGED ATTORNEY-CLIENT COMMUNICATION Body:: The CAISO recently filed Amendment 30 which would provide the CAISO with the authority to engage in forward contracts/purchasing etc. to meet reliability requirements. This filing is in response to the language in the FERC San Diego Order which suggested that the FERC believes the CAISO should have this authority. Clearly this raises issues about the role of the CAISO in the forward markets as a policy matter but FERC is likely to approved this authority anyway. The CAISO Board is addressing this matter as part of its Comprehensive Market Reform Project. The CAISO Board at the September 7 meeting deferred the issues of the 2-day ahead market (as well as the policy matter of the CAISO buying forward) until the October meeting. However later during Executive Session the CAISO Board apparently approved Amendment 30. At this point in time IEP is not planning on responding to Amendment 30. This position is primarily driven by limited funds in the Restructuring/Transmission Task Force account and given the forces aligned in support taking this issue up seem problematic. Please let me know if anyone differs with this assessment and would like to see IEP comment (recognizing that funds would be required to accomplish this). ----- Original Message ----- From: Andy Brown To: Steven Kelly (E-mail) Katie Kaplan (E-mail) Cc: Douglas Kerner Chris Ellison Eric Janssen Sent: Monday September 18 2000 3:55 PM Subject: CONFIDENTIAL AND PRIVILEGED ATTORNEY-CLIENT COMMUNICATION > Attached is a memo which briefly describes CAISO's Amendment 30 and a > potential response approach for IEP. The filing will be due October 2 > which effectively means that we must decide what IEP wants to say by the > 27th if the final draft is to be circulated to interested membership > before filing. ABB > > - 000918_IEP_mmo_CAISO_AM30.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: 1:00 - 3:00 p.m. Jonathan Sallet meeting, 1801 Pennsylvania Ave @ 18th & H Body:: Washington DC. (Suite 419) you will need to dial x3360 (Louisa Asmar is his assistant) and she will meet you in the lobby area and take you upstairs. Jim and Rick will meet you there. 3:30 Meet with Dan Albert in Senator Bingaman's office (D-NM) - Hart Senate Office Building Room 703. Cynthia will meet you there. 4:00 - Meet with Representative Pallone #420 Cannon House Office Building. Cynthia will accompany you Rick and Jim will meet you there. Car will be waiting to take you to the airport. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: job applicant Body:: any interest? What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Agreement Body:: This follows up on your voice mail message regarding the status of the Confidentiality Agreement in light of renewed discussions between the two companies. Attached is the latest draft of the Confidentiality Agreement which was transmitted to you on May 13. Please call me with any comments or questions. <> - Confidential AGrement with Enron which was sent to Ben Rogers on 51200 - this version is a clean version accepting all blacklined changes from 59437v3.DOC What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Trains - Light rail Body:: Mary- Ken has been asked by Mayor Brown to chair the fundraising effort to get voter approval on a light rail referendum in Houston. My guess is that he will decline given the other demands on his schedule but I don't know that for sure. I think our respnse Mary Clark@ENRON 04/13/99 02:21 PM To: Steven J Kean/HOU/EES@EES Joe Allen/Corp/Enron@Enron cc: Mark Palmer/Corp/Enron@Enron Subject: Trains - Light rail Steve/Joe: Mark suggested that I contact you to provide a response to this employee's question (see below) to Ken and Jeff about trains and light rail. Please draft a response and send it to me. I will format it and send it to Ken and Jeff for their review. Thanks. Mary Clark ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Fellow referred to me by Ken Lay Body:: It was not mentioned to me. I'm copying rosie and vanessa to find out if this was a simple referral (in which case you should keep the work to a minimum -- return the call but don't get distracted from your other efforts) or whether Ken is especially interested in this and wants us to follow through. Jeff Dasovich Sent by: Jeff Dasovich 03/12/2001 03:54 PM To: skean@enron.com cc: Subject: Fellow referred to me by Ken Lay Just got a call from a fellow named Jame Edgerly at the Enterprise Zone Inc. He told me that Ken Lay (through Ken's secretary Vanessa) referred me to him. He is very interested in getting us to help him work with the Legislature to establish an Enterprise Zone energy tariff to encourage investment in California's Enterprice Zones. Before I launch on the effort just wanted to check in and see if this rings a bell with you. Thanks. Best Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: possible RTP conference Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Marketing Plan & Meetings Body:: Sandeep This looks great. I would talk to all the heads of structuring desks including the right persons (Zimin Krishna Vasant) in the conversations. Also please talk to Andrea Reed and ask who are good targets in the EIM organization. We can talk about other targets when I get back. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ed Segners Staff meeting, in 50M Dining Room Body:: PGE meeting -- identify alternatives Tom Hagen @ CSW Shockley would be avail on thurs or Fri or Lay What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Meeting Request - July 25th Body:: Yes. Maureen - please schedule. From: Michael on 07/06/2001 03:05 AM GDT To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Subject: Meeting Request - July 25th Steve - I'll be in Houston July 23-26 and would like to get together to bring you up to date on the latest developments in Japan regarding EBS and EGM as well as energy markets. Would you have half an hour on the morning of Wednesday the 25th? Thanks Mike What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Thu evening Body:: Piotr I can pick up my E-mail messages from here. You can E-mail me with the place and location for tonight. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Materials from Energy & Power Risk Conference Body:: For your information: Vince Kaminski passed on to me the following California-related presentations delivered at a recent conference he attended (Energy and Power Risk Management 5/14-5/15 Houston). Please let me know if you would like a copy of any of these: *Roach Craig (Boston Pacific Company Inc.) Price Caps: An Apparent Short-Term Solution That Creates Long-Term Problems (hard copy only) *Wolak Frank (Department of Economics Stanford Chairman Market Surveillance Ctte. CAISO) 1. What Went Wrong with California's Re-Structured Electricity Market (and How to Fix It) 2. How to Make Competitive Electricity Markets Benefit Consumers (hard copy only) *Yeres David (Partner Clifford Chance Rogers & Wells LLP) Wholesale Power Sales: A Marketplace Under Scrutiny (hard copy only) Jennifer What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Government Affairs Meeting Body:: Go ahead. From: Elizabeth Linnell on 04/25/2001 04:53 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Government Affairs Meeting Do you mind if the professionals in my group attend? 5 people (assuming they all want to go - Margo Miyung Linda Lynnette and Earlene) each at $190 for airfare $380 for two hotel nights plus shuttle services and misc expenses. I'm always encouraging my group to interact with Rick's group as Gov't Affairs is our primary customer base. I'm not planning to attend the meeting. Thanks! What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EES Body:: Please set up some time with Linda. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ed Segners Staff meeting, in 50M Dining Room Body:: Reminder Craig Gannett meeting with Senator Gorton Henry Hubbard -- 207 397 5091 Steve Montovano 800 650 9084 Greg Piper Carol Dillon 503-464-8536 Kathleen -- Providence Gas (Mike McCall) Linda Clemmons -- MIT forum at MIT What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: keans presentation Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Todays Senate Hearing Body:: The Senate Governmental Affairs Committee held an unusually long hearing today (9:30 am to 4:30 pm) on FERC's responses to the California situation and other related energy issues. The star witness was Gov. Davis. Others were Govs. Martz of Montana and Hoeven of North Dakota against price caps Sens. Murkowski Murray and Cantwell Washington State's attorney general Oregon's PUC chairman and the five FERC commissioners. Once Davis left after several hours of testimony and two rounds of questions most of the press and audience left. Enron was mentioned several times as follows: 1. Sen. Thompson the Ranking Republican mentioned Lockyer's Spike comments in the context of asking Gov. Davis about why business would make new investments in the state when on top of the regulatory uncertainty there is the broader political hostility expressed in this way by state officials. Davis had two chances to disavow Lockyer and did not. (Thompson gave him a second chance when he basically repeated the question and made specific reference again to Spike asking Davis if FERC acted this week because of the AG's Spike comments.) The first time Davis said that the people he represents are mad they want him to fight back this is rough business the industry people are used to a wildcatter's environment things occassionally get out of hand and we are not going to take it. On the second instance he said that the state was building new power plants and investment was not being diminished. 2. Sen. Bennett (R-UT) did an excellent job questioning Gov. Davis about his handling of the situation using quotes from California newspapers to make the case that Davis was slow to act. He also argued that the state had done a bad job as a power purchaser contrasting the state's recent 8-year contract with Constellation for power at $150 peak and $59 off-peak with Enron's willingness last year to sell them power for five years at $50. The Republicans also pressed Davis on why he attacks out-of-state generators but is not nearly as vocal about California munis who charged even more. Davis said they should make refunds too. 3. While not saying Enron by name Gov. Davis did make a comment about companies with trading floors that compete with the New York Stock Exchange with meteorologists and very talented people who might have the ability to find loopholes in the new order. He said this in answer to a question about what FERC needed to do now that the new order was issued and he said watch out for manipulation by those subject to the order. 4. Sen. Thompson pressed Washington State AG Gregoire about why she appeared to be investigating out-of-state suppliers even though they had a small percentage of the market in her state with lots of document requests and other investigative action while not doing the same to others. During that exchange either Thompson or the AG (I think it was the AG) said Enron had over $1 billion in sales to Washington State. Enron was not on the list of companies Thompson or the AG said were subject to her information demands. She said she would be expanding her inquiry though. Highlights and Analysis 1. As started at yesterday's Senate Energy hearing the mantra from the Western Democrats was: we want our money back. Chairman Lieberman and others pressed FERC about how California could get refunds and the same in other Western states particularly Oregon and Washington. Chairman Hebert said that the settlement conference process would allow all parties to raise all issues including refunds in California and outside California. He said that the conference could include issues that the commission could not act on itself including refunds not otherwise allowed under the Federal Power Act. Chairman Lieberman vowed to keep the committee active in overseeing FERC's activities in implementing the new order particularly as it relates to refunds. While he acknowledged that new legislation could not apply to pending cases he seemed inclined to pursue legislation to repeal the 60 day delay in the Federal Power Act relating to refunds. 2. Commissioner Wood spoke of the need to increase the penalities and enforcement tools available to the commission including the ability to order short suspensions of authority for regulated entities to transact business treble damages and other administrative penalties. There was also discussion among the committee and commissioners about beefing up FERC's market monitoring capabilities so that it acted more like the SEC FCC and FTC than it has in the past. 3. The Democrats on the committee and among the witnesses said that FERC's latest order is a step in the right direction. None of them called for legislative action on price caps as proposed by Sens. Feinstein and Smith. Sen. Murkowski had done a good job of taking the wind out of the legislated price cap sails by saying at the start of the hearing when he testified that the bill's sponsors had pulled back from swift action when they spoke at yesterday's hearing. Davis did say the still thinks that cost-based rates are better but he said the new order is some price relief and that it corrected the mistakes in the April order. 4. There was some discussion of natural gas again. Davis said that FERC should now turn its attention to natural gas. He said that El Paso controlled too much of the capacity until recently. He called on FERC to enforce laws against price manipulation. (Note: we have had several back channel reports that the Lieberman committee intends to look into the El Paso and Williams cases now at FERC about alleged affiliate issues.) 5. There was some discussion of the termination of the new FERC order. Lieberman pressed several witnesses about whether Sept. 2002 is too soon. Davis said it was and that they needed at least until the end of 2002 if not more time and that order should apply until California has enough new generation in place. Hebert did not back down when pressed by Lieberman later in the hearing saying there needs to be a deadline to get action on new supplies however he and the others basically said they would revisit the issue if events warrant. 6. Several times Sen. Lieberman and others said they generally support deregulation but that the effort to get more states to do so will never happen if the price situation is not brought under control and public confidence restored. 7. Gov. Davis did throw a few kind words toward Pres. Bush and Pat Wood saying that each was open to doing more about the high cost of natural gas to California including the possible reimposition of rate regulation of transportation to California. He said he liked Pat Wood and he noted that FERC did not take serious price mitigation action until the two new Bush appointees were on the commission. 8. Lieberman asked the Washington State AG whether the Justice Dept. or the FTC were doing anything to address high energy prices. She said not to her knowledge even though she has asked them to do so. We can expect a Lieberman et al request for Justice and FTC involvement going forward I suspect. 9. While Chairman Lieberman's tone and closing comments were in the nature of his normal thoughtful tone it is clear that he and others see this as a major issue for them to ride. He commended FERC at the end of the hearing for doing their best but pledged he would stay involved closing the session with a smile and the words see you soon. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Skilling Get Davis Straightened Out? Body:: I'm still waiting for Davis' office to call. The plan currently is for me to talk to him when and if he calls. Sandi has been in touch with the governor's office. By the way thanks for the summary of the California proceedings. I talked to Hebert yesterday and he was duly impressed with your remarks ... I had to remind him that you worked on the right answers for California not the abomination that's in place today. Jeff Dasovich@EES 09/13/2000 06:48 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Skilling Get Davis Straightened Out? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Skillings office Body:: Skilling What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Energy Issues Body:: Miyung You seem to be finding these okay by yourself so I guess I don't need to be= =20 forwarding the articles I find to you anymore? I don't mind doing it but I can't see duplicating effort either! :--) Either way...let me know=20 Thanks! Joseph Miyung Buster@ENRON_DEVELOPMENT 04/25/2001 08:25 AM To: Ann M Schmidt/Corp/Enron@ENRON Bryan Seyfried/LON/ECT@ECT=20 dg27@pacbell.net Elizabeth Linnell/NA/Enron@Enron filuntz@aol.com James = D=20 Steffes/NA/Enron@Enron Janet Butler/ET&S/Enron@ENRON Jeannie=20 Mandelker/HOU/ECT@ECT Jeff Dasovich/NA/Enron@Enron Joe=20 Hartsoe/Corp/Enron@ENRON John =20 John Sherriff/LON/ECT@ECT Joseph Alamo/NA/Enron@Enron Karen=20 Denne/Corp/Enron@ENRON Lysa Akin/PDX/ECT@ECT Margaret=20 Carson/Corp/Enron@ENRON Mark Palmer/Corp/Enron@ENRON Mark=20 Schroeder/Enron@EnronXGate Markus Fiala/LON/ECT@ECT Michael R=20 Brown/LON/ECT@ECT Mike Mona L= =20 Petrochko/NA/Enron@Enron Nicholas O'Day/AP/Enron@Enron Peggy=20 Mahoney/HOU/EES@EES Peter Styles/LON/ECT@ECT Richard=20 Shapiro/NA/Enron@Enron Rob Bradley/Corp/Enron@ENRON Sandra=20 McCubbin/NA/Enron@Enron Shelley Corman/ET&S/Enron@ENRON Stella=20 Steven J Kean/NA/Enron@Enron Sus= an=20 J Mara/NA/Enron@Enron Mike Roan/ENRON@enronXgate Alex=20 Parsons/EU/Enron@Enron Andrew Morrison/LON/ECT@ECT lipsen@cisco.com Jane= l=20 Guerrero/Corp/Enron@Enron Shirley A Hudler/HOU/ECT@ECT Kathleen=20 Sullivan/NA/Enron@ENRON Tom Briggs/NA/Enron@Enron Linda=20 Robertson/NA/Enron@ENRON Lora Sullivan/Corp/Enron@ENRON Jennifer=20 Thome/NA/Enron@Enron jkradin@marathon-com.com=20 syamane@marathon-com.com=20 ken@kdscommunications.com hgovenar@govadv.com sgovenar@govadv.com=20 bhansen@lhom.com Carin Nersesian/NA/Enron@Enron cc: =20 Subject: Energy Issues Please see the following articles: Sac Bee Wed 4/25: State's credit takes hit Sac Bee Wed 4/25: Top energy adviser to quit as Davis pushes for plants= Sac Bee Wed 4/25: Senators offer bill to put a lid on power prices: Sen= .=20 Dianne Feinstein says there's a good chance the proposal can get out of committee Sac Bee Wed 4/25: Energy price gouging might end up felony Sac Bee Wed 4/25: Dan Walters: It's time for politicians to be honest= =20 about the energy crisis SD Union Wed 4/25: Bond-rating agency delivers reprimand downgrade SD Union Wed 4/25: FERC to weigh limited curbs on electricity prices SD Union Tues 4/24: Grid officials declare a Stage 2 alert SD Union (AP) Tues 4/24: Top credit agency lowers California's bond=20 rating LA TimesWed 4/25: State's Bond Rating Downgraded to A+ LA Times Wed 4/25: Price Controls Spark Deja Vu LA Times Wed 4/25: Davis Names Executive to Speed Construction of Power= =20 Plants in State LA Times Wed 4/25: Power Plant Emits Tons of Fumes LA TimesWed 4/25: Power Plant Plan Worries Neighbors SF Chron Wed 4/25: Federal plan called 'too little too late'=20 Limited price control seen as step in right direction but officials renew= =20 call for price ceiling SF Chron Wed 4/25: S&P lowers California's bond rating=20 First cut since '94 could cost taxpayers millions SF Chron Wed 4/25: Richard Sklar=20 Ex-Muni boss becomes energy czar=20 Davis' pick to oversee power plant construction SF Chron (AP) Wed 4/25: Will price caps deter investment as federal=20 regulators say? SF Chron (AP) Wed 4/25: Credit agency cites power troubles lowers=20 state's bond rating=20 SF Chron (AP) Wed 4/25: S&P downgrades California's bonds citing energy= =20 troubles=20 Mercury News Wed 4/25: State bond rating lowered Mercury News Wed 4/25: Q&A with Gov. Gray Davis on energy issues =20 (Opinions/Commentary) Mercury News (AP) Wed 4/25: Davis: Power surplus by 2003 Mercury News (AP) Wed 4/25: Great America to avoid blackouts OC Register Wed 4/25: State's bond rating is lowered The energy crisis brings an A+ designation which likely will mean higher= =20 borrowing costs =20 OC Register Wed 4/25: Fire stokes wholesale gas cost Individual.com (Business wire) Wed 4/25: Power Companies and Regulators= =20 Must Take=20 Steps To Avoid Spread of California Power Virus/ Andersen Analysis Individual.com(Business wire) Wed 4/25: Soaring Temperatures Produce Ca= ll=20 for Conservation California ISO Also Announces New Outage Notification System and On-call=20 Number --- State's credit takes hit=20 By Dale Kasler and John Hill Bee Staff Writers (Published April 25 2001)=20 Alarmed by the drain on California's treasury from more than $5 billion of= =20 electricity purchases a leading Wall Street credit agency lowered its rati= ng=20 on state bonds Tuesday.=20 Standard & Poor's downgraded California's credit rating by two notches a= =20 move that will increase the state's borrowing costs and illustrates a growi= ng=20 fear that the state's power expenditures could mushroom during a summer of= =20 blackouts and price spikes.=20 Although the state remains creditworthy S&P said it has less confidence in= =20 California's ability to repay its debts. It said the state could be=20 downgraded further if electricity purchases spiral out of control and the= =20 economy suffers because of blackouts.=20 This reflects the mounting uncertainty and the cost to the state of the=20 power purchases said S&P analyst Steven Zimmermann. The state is still= =20 strong -- it's just not as strong going forward.=20 Bond ratings are a benchmark of a state's finances and California official= s=20 have been proud of their ability to restore the state's ratings since they= =20 bottomed out during the recession and budget deficits of the mid-1990s. S&P= 's=20 downgrade is the first for California since July 1994 and comes as a slowdo= wn=20 in the high-tech industry adds to the budgetary anxiety caused by electrici= ty=20 costs.=20 Still Gov. Gray Davis' office downplayed the significance of S&P's decisio= n.=20 California's economy is still fundamentally strong period said Davis=20 spokesman Roger Salazar. We expect that in 2001 California will continue t= o=20 lead the nation in economic growth and job creation.=20 S&P lowered California from AA to A-plus status. That means California'= s=20 debt-payment ability has been reduced from very strong to still strong= =20 but somewhat more susceptible to the adverse effects of the changes in=20 circumstances and economic conditions.=20 While it won't directly hamper Davis' plan for solving the energy crisis t= he=20 downgrade increases the pressure on Davis to issue $10 billion to $15 billi= on=20 worth of bonds this summer as part of his rescue package.=20 The bonds are intended to replenish the state treasury as well as finance= =20 future power purchases. Since mid-January the state has committed $5.7=20 billion to buy electricity for troubled Pacific Gas and Electric Co. and=20 Southern California Edison. The commitment has chewed up a significant=20 portion of a budget surplus estimated by state Treasurer Phil Angelides at= =20 nearly $6 billion Davis and other state officials have pegged the surplus = at=20 $8 billion.=20 Either way it's clear that the power expenditures have left Wall Street an= d=20 many state officials nervous. S&P and other rating agencies have had=20 California on a ratings watch for some time signifying that a downgrade= =20 was possible.=20 The fact is that the state's credit rating and financial strength will=20 continue to be in jeopardy until the state's general fund is repaid for=20 energy costs said Angelides who's responsible for selling the bonds.=20 We have to get the general fund out of the business of purchasing energy.= =20 (The budgetary drain) will begin to affect very dramatically the ability of= =20 the state to provide for core programs from education to health care to=20 public safety.=20 Angelides spent much of the day urging legislators to pass legislation to g= et=20 the bond offering rolling.=20 The Legislature already authorized the bonds but Angelides said it must do= =20 so again because PG&E and Edison are challenging the formula the state has= =20 developed for bond repayment. The bond will be repaid with money from a rat= e=20 hike passed by state regulators but PG&E and Edison say the repayment=20 formula will siphon too much money from their coffers.=20 Angelides said lawmakers must quickly pass the new bill -- which requires a= =20 two-thirds majority -- or he might miss a make-or-break May 8 deadline for= =20 closing on a crucial $4.1 billion bridge loan. That loan is designed to tid= e=20 the state over until the bonds are sold later this summer. But the lenders= =20 won't fork over the funds until they're assured the bonds will be sold=20 because the state will use the bond proceeds in part to pay off that loan = he=20 said.=20 Ironically the sale of those bonds won't be hurt by the S&P downgrade=20 because customer revenue instead of taxpayer dollars are being used to pay= =20 them off analysts said.=20 What's important for the bonds is how the (utility) rates are structured t= o=20 pay them off said analyst Susan Abbott of Moody's Inc. in New York.=20 But the downgrade will raise the interest rate on a host of other bonds=20 issued by the state in the coming months. The likely increase is as much as= =20 one-quarter of 1 percent said chief economist Ted Gibson of the state=20 Department of Finance.=20 With the state authorized to sell $12 billion worth of general obligation= =20 bonds the downgrade could add $50 million to $100 million in borrowing cos= ts=20 over the life of those bonds Angelides said.=20 The S&P action also could raise a red flag to anyone thinking of investing = in=20 a public or private-sector project in California.=20 It will create perception issues about who we are and where we are in term= s=20 of the economy of the state Angelides said. The real issue here is the= =20 reputational damage to the state of California.=20 The two other leading credit agencies Moody's and Fitch Investors Service= =20 still have California on a credit watch but haven't issued downgrades.=20 S&P acted the same day the Independent System Operator which manages=20 California's power grid declared a Stage 2 power alert. Warm weather and t= he=20 unexpected shutdown of two key power plants caused electricity reserves to= =20 fall below 5 percent.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m.=20 Bee Deputy Capitol Bureau Chief Dan Smith contributed to this report. --- ------------------------ Top energy adviser to quit as Davis pushes for plants Bee Capitol Bureau (Published April 25 2001)=20 John Stevens Gov. Gray Davis' staff director and top energy adviser is=20 leaving the governor's office at the end of the week Davis announced=20 Tuesday.=20 Stevens of Carmichael joined the administration a year ago as staff=20 director after working 13 years as a top staffer in the Legislature=20 including a stint as chief of staff to former Assembly Speaker Antonio=20 Villaraigosa.=20 He is the second top Davis adviser to leave in the past two weeks as the=20 Democratic governor struggles to deal with California's energy woes.=20 Like Phil Trounstine the governor's communications director who announced= =20 his resignation two weeks ago Stevens said he needed more time with his=20 family.=20 It's an immense issue he said of the energy crisis. I've given what I c= an=20 to it and I need to take a break.=20 Davis called Stevens 54 one of the most dedicated and loyal people that= =20 I've ever had working for me but acknowledged long hours and intensity to= ok=20 its toll.=20 This is tough work. This wears people out Davis said. He's so self-driv= en=20 that he needs a break but I venture a guess that down the road he'll be= =20 willing to come back and help us in some meaningful way on this energy=20 situation.=20 Davis also announced the appointment of Richard Sklar to head a Generation= =20 Implementation Task Force intended to speed up permitting and constructing= =20 power plants.=20 Sklar was the Clinton administration's representative in southeast Europe= =20 helping to rebuild war-torn Bosnia and Kosovo. --- ------------------------ Senators offer bill to put a lid on power prices: Sen. Dianne Feinstein say= s=20 there's a good chance the proposal can get out of committee. By Les Blumenthal Bee Washington Bureau (Published April 25 2001)=20 WASHINGTON -- West Coast senators formally introduced legislation Tuesday t= o=20 temporarily cap wholesale electric rates and expressed hope that their=20 proposal to ease the huge run-up in energy prices might clear the committee= =20 and make it to a vote on the Senate floor.=20 I think we are very close to having the votes in committee Sen. Dianne= =20 Feinstein D-Calif. said of the Energy and Natural Resources Committee tha= t=20 has jurisdiction over the bill. I am taking nothing for granted but the= =20 committee is 50-50.=20 There are 11 Democrats and 11 Republicans on the committee including=20 Feinstein and the other primary sponsor of the bill Oregon Sen. Gordon=20 Smith.=20 Smith a Republican is the swing vote.=20 Feinstein said the committee chairman Sen. Frank Murkowski R-Alaska has= =20 shown an increasing willingness to help her and Smith move the legislation= =20 though some differences remain.=20 He (Murkowski) has told me he'd like to help Feinstein said. I think we= =20 are very close to a markup and this could move quickly.=20 Murkowski did not rule out price caps but said he thought the bill sacrific= ed=20 long-term solutions for short-term gains.=20 I have concerns about the proposal put forward today and the impact it may= =20 have in distorting the market he said. It is time to address the=20 underlying causes -- not just the symptoms.=20 Feinstein's comments came at a news conference during which she Smith=20 Washington state Democratic Sens. Patty Murray and Maria Cantwell and New= =20 Mexico Sen. Jeff Bingaman the ranking Democrat on the Senate Energy=20 Committee unveiled details of the bill and criticized the Bush=20 administration and federal regulators for failing to take action to cap=20 rates.=20 If approved by Congress and signed by President Bush the bill would give t= he=20 Federal Energy Regulatory Commission 60 days to impose price caps or set up= a=20 cost-based rate structure that would allow electricity generators to recove= r=20 their costs and earn a fair return.=20 The controls would apply in 11 Western states including California Oregon= =20 and Washington. Similar legislation has been introduced in the House of=20 Representatives.=20 The lawmakers said the price controls would remain in effect until March=20 2003 when they said enough new generating plants will have come on line = to=20 overcome the West's current electricity shortage.=20 Under federal law FERC has the authority to ensure wholesale rates are jus= t=20 and reasonable.=20 Feinstein said that during a warm day this summer California may fall 2000= =20 megawatts short of meeting demand and on a hot day with air conditioners=20 cranked up there could be a 10000-megawatt shortfall.=20 Feinstein said that in 1999 California utilities paid $7 billion for=20 electricity in 2000 more than $32 billion and according to some estimates= =20 the price tag could reach $65 billion this year.=20 There has been a very strong element of price gouging in this Feinstein= =20 said.=20 We should not have to pass legislation to compensate for a federal agency= =20 not doing its job Murray said adding that Northwest utilities were payin= g=20 the highest prices in the country for next-day delivery of wholesale power.= =20 This (bill) will bring the market under control until new generation comes= =20 on line.=20 Cantwell who is also a committee member said wholesale rates have risen= =20 11-fold over the past several months resulting in thousands of layoffs in= =20 the region and the shutdown of the aluminum industry.=20 We cannot allow our government to sit idly by and allow a tragically flawe= d=20 and easily manipulated power market to wreak havoc on our economy and quali= ty=20 of life Cantwell said.=20 The Bonneville Power Administration has indicated it may have to raise its= =20 wholesale rates by 250 percent this fall as it is forced to buy power on=20 expensive spot markets because a severe drought in the Pacific Northwest ha= s=20 reduced electricity production at the region's vast hydropower system. BPA= =20 supplies 45 percent of the Northwest's wholesale electricity.=20 Smith said that as a Republican he was initially reluctant to support pri= ce=20 control and would have preferred the market sort out its own problems.=20 But he said Hard-nosed business practices that generate big profits are= =20 not always good politics. It's a mistake to defend a system that some can= =20 game to make incredible profits.=20 The Oregon senator said he knew his decision to sponsor the bill was not=20 well-received at the White House.=20 I know I'm not making any friends down the street he said. It's importa= nt=20 to keep this bipartisan and I'm not going to attack the Bush=20 administration.=20 Both Smith and Feinstein said a FERC staff proposal to cap wholesale electr= ic=20 rates in California when rolling blackouts are imminent falls well short of= =20 what's needed. FERC will consider the proposal at a meeting today.=20 California is not the only state affected said Smith. This is not a=20 California problem alone.=20 Feinstein said the proposal was inadequate.=20 I'm not sure that is the right way to go she said. The only reason they= =20 are considering action is we are putting the heat on them.=20 The Bee's Les Blumenthal can be reached at (202) 383-0008 or=20 lblumenthal@mcclatchydc.com. --- ------------------------ Energy price gouging might end up felony By Emily Bazar Bee Capitol Bureau (Published April 25 2001)=20 Democratic lawmakers this week will unveil a proposal to make energy price= =20 gouging a felony -- punishable by stiff fines and possible jail time -- tha= t=20 could be subject to the state's controversial three strikes law.=20 The measure sponsored by Lt. Gov. Cruz Bustamante would punish companies= =20 that sell electricity or natural gas in California at unjust or unreasonab= le=20 rates.=20 There is a tremendous amount of wealth that is being transferred from=20 California to five companies mostly in Texas Bustamante said. If what= =20 they're doing isn't illegal it ought to be.=20 Though lawmakers are expected to introduce the measure Thursday it already= =20 has generated opposition from Republican lawmakers and constitutional=20 questions from legal experts.=20 Several aspects of the bill AB 67x are unresolved and could change.=20 But the intent will remain the same and energy companies that take advanta= ge=20 of Californians will still face significant penalties said the bill's=20 author Assemblyman Dennis Cardoza D-Merced.=20 According to a draft version of the bill and some proposed amendments a=20 corporation or a person with decision-making authority at the corporation= =20 would be found guilty of a felony if they collude or conspire to manipulat= e=20 the market to achieve unjust or unreasonable rates for electricity or natur= al=20 gas.=20 A state or federal regulatory agency -- such as the Federal Energy Regulato= ry=20 Commission -- would determine whether rates were unjust or unreasonable. If= =20 that happened the bill would open the door for prosecution by the state=20 attorney general or local district attorneys.=20 In addition if found guilty companies would be forced to pay restitution= =20 and could face fines as high as 10 percent of their gross corporate assets.= =20 Lawmakers are debating whether to make the felony a three strikes offense= =20 which requires 25 years to life sentences for some people convicted of thre= e=20 felonies.=20 Though the provision was in an early draft of the bill Cardoza said it's= =20 not likely to show up in the final version.=20 While I think this crime is every bit as abhorrent as going in and stealin= g=20 money from a bank we're going to have to figure out a little bit different= =20 way of dealing with it he said.=20 Even without the three strikes provision the bill raises certain=20 constitutional issues said Clark Kelso a professor at the McGeorge School= =20 of Law in Sacramento.=20 For instance he said it's not clear whether the state can legally base a= =20 fine on an out-of-state company's gross assets.=20 And the measure which requires a two-thirds vote for passage already has= =20 generated Republican opposition.=20 To the extent this bill is onerous toward power producers it may deter th= em=20 from selling here rather than risk fines and prison said James Fisfis a= =20 spokesman for the Assembly Republican Caucus. We haven't seen the details= =20 but it sounds like it may be a piece of legislation that goes too far.=20 The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com= . --- ------------------------ Dan Walters: It's time for politicians to be honest about the energy crisis (Published April 25 2001)=20 Gov. Gray Davis is continuing to tell Californians that he's on top of the= =20 state's energy crisis and as he said at one gathering last week in three= =20 years this problem will be a distant memory. Fat chance. All major aspect= s=20 of the situation are growing worse not better minute by minute.=20 Politicians took over the crisis in January as the state's major utilities= =20 exhausted their cash reserves and lines of credit. Davis began what he said= =20 then would be a short-term emergency program of power purchases to keep=20 electrons flowing into homes and businesses.=20 From that moment forward the situation has steadily deteriorated moving= =20 toward a three-pronged disaster: severe summer blackouts the bankruptcy of= =20 the utilities and sharply escalating power bills. With the bankruptcy filin= g=20 by Pacific Gas and Electric Co. and decisions by Davis and the state Public= =20 Utilities Commission to begin ratcheting up utility rates two of the three= =20 negative scenarios are now in place. And everyone involved in the crisis=20 expects blackouts this summer as demands for power soar and supplies dwindl= e.=20 The Davis strategy if there is one is to continue the state's massive pow= er=20 purchases while negotiating longer-term and presumably cheaper supply=20 contracts encourage conservation help utilities pay off their debts by=20 selling their intercity transmission system to the state and tapping=20 ratepayers and build more power plants to ease the supply crunch.=20 Currently the governor is touting his deal with Edison International pare= nt=20 company of Southern California Edison to sell its portion of the power gri= d=20 and is working on a similar deal with Sempra the parent of San Diego Gas &= =20 and Electric. But PG&E's bankruptcy filing casts doubt on the viability of= =20 the cash-for-grid concept and legislators particularly Davis' fellow=20 Democrats are very skeptical of the Edison deal.=20 Clearly Davis rushed into the Edison deal just three days after PG&E made= =20 its bankruptcy filing in hopes of erasing the political stain of the latte= r=20 action but its provisions are being labeled a bailout by critics. It place= s=20 only a token financial burden on Edison International while guaranteeing th= e=20 profitability of its utility subsidiary by charging its customers whatever = is=20 required to cover its costs and past debts.=20 Meanwhile the state is spending -- by Davis' own account -- about $70=20 million a day or $2 billion-plus a month on spot power purchases paying=20 roughly five times what consumers are being charged at the retail level. An= d=20 the futures market for power indicates that wholesale power prices will jum= p=20 50 percent by midsummer higher prices and greater purchases could increase= =20 the drain on the state treasury to as much as $5 billion a month.=20 State Treasurer Phil Angelides is desperately trying to arrange a bridge lo= an=20 to relieve pressure on the state's rapidly vanishing reserves but Wall=20 Street is reluctant to lend without a fuller explanation of what's happenin= g=20 and a specific authorization from a suspicious Legislature. Meanwhile=20 bankers are sending strong signals that the state government is becoming as= =20 poor a lending risk as the utilities.=20 Davis for some reason is unwilling to declare this situation the emergenc= y=20 that it is truly becoming -- one that could take a toll on human life if=20 major blackouts shut down air conditioners respirators and traffic lights.= =20 He insists on issuing his periodic -- and wholly unrealistic -- assurances= =20 that things will turn out all right even declaring to reporters on Tuesday= =20 We think we'll have this thing licked by the end of fall.=20 It's time for someone -- the governor preferably but someone -- to lay ou= t=20 for Californians exactly what's happening the downside financial and power= =20 supply risks and what's being done to deal with the looming disaster facin= g=20 this state. It's time for politicians to treat us as adults who can face=20 reality not as children to be fed sugar-coated sound bites and slogans.=20 The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.c= om . --- ------------------------ Bond-rating agency delivers reprimand downgrade=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 April 25 2001=20 SACRAMENTO -- An influential Wall Street firm yesterday gave Gov. Gray Davi= s=20 and the Legislature poor marks for handling the electricity crisis=20 downgrading state bonds because of the drain on the state treasury and=20 warning of long-term damage to the state economy.=20 The bad news from Standard & Poor's came as state Treasurer Phil Angelides= =20 urged the Legislature to pass a bill this week needed to begin repaying the= =20 state general fund with a bond of $10 billion or more.=20 The bond would be paid off by ratepayers over 15 years. From a small problem that could have been solved in a short period of time= =20 this is escalating into a big problem said David Hitchcock of Standard &= =20 Poor's. Even if they issue revenue bonds it could stay with them for a lo= ng=20 period of time.=20 Standard & Poor's lowered its rating on state of California general=20 obligation bonds from AA to A+ which means it will cost the state more to= =20 borrow money.=20 The firm left California on credit watch with a negative outlook a ranking= =20 applied after the state began buying power for utility customers in January= .=20 The state general fund has spent more than $5 billion buying power so far.= =20 There are predictions that spending will sharply increase this summer as he= at=20 drives up the demand for electricity.=20 The fact is we can't allow the general fund to be depleted Angelides=20 said. There are limits to it. It will begin to affect very dramatically th= e=20 ability of the state to provide core programs for education health care= =20 public safety.=20 Developments:=20 WEDNESDAY:=20 =01) No power alerts are called in the early morning as electricity reserv= es=20 stay above 7 percent.=20 =01) The state Public Utilities Commission continues hearing energy experts= =20 evaluate ideas for implementing a recent rate increase. The panel includes= =20 George Sterzinger a Washington-based renewable energy consultant Peter=20 Bradford an energy and regulatory adviser and Severin Borenstein directo= r=20 of the University of California Berkeley's energy institute.=20 =01) Assembly Energy Committee holds a hearing on Gov. Gray Davis' proposal= to=20 keep Southern California Edison out of bankruptcy.=20 TUESDAY:=20 =01) Gov. Gray Davis says California will build enough power plants by 2003= to=20 end the state's power crisis and have a 15 percent supply surplus by 2004.= =20 He names former U.S. diplomat Richard Sklar to be the state's new energy cz= ar=20 and head a Generation Implementation Task Force to speed up power plant=20 siting and construction.=20 =01) The Independent System Operator which runs the state's power grid=20 declares a Stage 2 alert meaning the state is within 5 percent of running= =20 out of power. It warns rising temperatures could create problems later this= =20 week unless Californians conserve electricity.=20 =01) Standard and Poors lowers its rating on California state bonds citing= the=20 growing financial drain from the continuing energy emergency. The state mus= t=20 quickly replenish its coffers if it is to avoid further damage the rating= =20 agency says.=20 WHAT'S NEXT:=20 =01) Davis' representatives continue negotiating with Sempra the parent co= mpany=20 of San Diego Gas and Electric Co. to buy the utility's transmission lines.= =20 Davis says he expects to have an agreement within two weeks.=20 =01) Senate Select Committee to Investigate Price Manipulation of the Whole= sale=20 Energy Market continues its investigation Thursday.=20 Standard & Poor's said that if the sale of a state revenue bond is delayed= =20 the potential impact on the state general fund could be severe without a= =20 rate hike much larger than the increase of more than 40 percent approved by= =20 the state Public Utilities Commission last month.=20 Rate increases appear difficult in the present political environment and= =20 related voter initiatives although none are currently on the ballot remai= n=20 a possibility said Standard & Poor's.=20 The state began buying power after the two largest utilities Pacific Gas a= nd=20 Electric and Southern California Edison were nearly bankrupt. The rates th= ey=20 could charge customers were frozen under deregulation as the cost of=20 wholesale power soared producing a debt of $13 billion.=20 Standard & Poor's said the state expected in January to spend less than $1= =20 billion and resolve the problem in a few months with long-term power=20 contracts at lower prices. But most of the contracts do not begin until thi= s=20 fall or later.=20 In addition said Standard & Poor's it is not unreasonable to expect pa= st=20 and future blackouts to affect business location decisions and hence the= =20 ultimate direction of the state's economy.=20 A spokesman for the governor said that Standard & Poor's view of how the=20 California economy will fare during the electricity crisis is far too dim.= =20 California's economy is still fundamentally strong said spokesman Roger= =20 Salazar. We expect that in 2001 we will continue to lead the nation in=20 economic growth and job creation.=20 Another Wall Street credit-rating firm Moody's has a more positive view o= f=20 how the governor and the Legislature have handled the crisis and expects th= e=20 state general fund to be repaid by the ratepayer bond.=20 We are still at our AA2 with a negative outlook said Ray Murphy Moody's= =20 vice president. Nothing that we have learned over the last week or so has= =20 led us to change that opinion.=20 Angelides said legislation is needed because PG&E and Edison are challengin= g=20 a PUC action last month that gives the state some revenue from monthly=20 ratepayer bills which is needed to finance the bond to repay the state=20 general fund.=20 The utilities say they need more of the ratepayer revenue.=20 The treasurer said the legislation would bypass the lengthy PUC process and= =20 authorize the state to issue a ratepayer bond of $10 billion or more. The= =20 governor said again yesterday that he believes a bond of $12.4 billion will= =20 cover state power costs this year.=20 Angelides said legislation is urgent because a commitment from three lender= s=20 to give the state a $4.1 billion short-term loan expires May 8.=20 He said the short-term bridge loan would ease the strain on the state gener= al=20 fund until the main bond can be issued probably in late June.=20 The treasurer said that failure to obtain the short-term loan could lead to= =20 more credit downgrades and create perception issues about who we are and= =20 where we are in terms of the economy of this state.=20 Davis has been criticized on Wall Street for not pushing for an early rate= =20 hike to stabilize the utilities and avoid the need for the state to begin= =20 buying power.=20 The governor said earlier this year that he could have solved the problem i= n=20 20 minutes with a rate hike but refused to do so.=20 While addressing the California Chamber of Commerce yesterday Davis said= =20 that the long-term contracts will spread the cost of buying power over a=20 decade causing ratepayers to pay less than market rates in the early years= =20 and a little above the market rate in later years.=20 I do not want to shock this economy into recession Davis said. I do not= =20 want to burden small business with more than they can sustain.=20 Davis wants the state to purchase the transmission systems of the utilities= =20 in exchange for giving them part of the ratepayer revenue to finance a bond= =20 to pay off their debts. That would enable the utilities to resume buying=20 power by the end of next year.=20 But negotiations to buy the transmission systems has taken much longer than= =20 expected. PG&E filed for bankruptcy earlier this month and an agreement to= =20 buy the Edison transmission system announced a few days later faces=20 opposition in the Legislature.=20 Some legislators who think Edison receives too much under the complex=20 agreement have suggested that Edison join PG&E in bankruptcy where=20 generators accused of price-gouging may not have all of their bills paid.= =20 If they go into bankruptcy the state will be buying power for three or fo= ur=20 years Davis told the Chamber yesterday. That is all we will be doing up= =20 here.=20 A Stage 2 emergency alert was called yesterday when two power plants=20 unexpectedly stopped operating with temperatures around the state rising.= =20 Meanwhile Davis announced that Richard Sklar a former ambassador to the= =20 war-torn Balkans will lead a task force to speed up the construction of ne= w=20 power plants.=20 The governor acknowledged while speaking to reporters that he has not met h= is=20 earlier goals of avoiding blackouts rate increases and keeping the utiliti= es=20 out of bankruptcy.=20 This is probably the most complicated challenge the state has faced in 50= =20 years Davis said. But we are providing steady and reliable leadership a= nd=20 I believe we will have this thing behind us by the end of this fall.=20 --- --------------- FERC to weigh limited curbs on electricity prices=20 Caps would apply in Stage 3 shortages By Toby Eckert=20 COPLEY NEWS SERVICE=20 April 25 2001=20 CALIFORNIA'S POWER CRISIS=20 WASHINGTON -- Federal regulators are expected to consider limited wholesale= =20 price curbs for California's chaotic electricity market today but the=20 approach falls far short of the controls sought by many state officials.=20 Federal Energy Regulatory Commission staffers have proposed limiting the=20 price that power sellers can charge for wholesale electricity in California= =20 only during the most severe shortages known as Stage 3 emergencies. The=20 price mitigation would be pegged to the marginal cost of the=20 highest-priced (generating) unit called upon to run according to a staff= =20 report.=20 Producers also would be required to sell their excess power to the state's= =20 grid operator.=20 The price controls would last one year and would not apply to other Western= =20 states suffering from gyrations in power costs and electricity shortages.= =20 FERC Chairman Curtis Hebert has been an implacable foe of price controls b= ut=20 is under considerable political pressure to do more to help California as t= he=20 peak power-consuming summer months approach. Commissioner William Massey ha= s=20 advocated far-reaching price limits while Commissioner Linda Breathitt has= =20 wavered on the issue.=20 Gov. Gray Davis and other California officials have called for broad price= =20 controls that also would include 10 other Western states. Yesterday Sen.= =20 Dianne Feinstein D-Calif. formally introduced legislation that would=20 require FERC to impose regional price limits through March 1 2003.=20 Feinstein said the FERC staff proposal was inadequate.=20 Once you put the cap just on Stage 3 you force the heavier pricing on=20 stages 1 and 2 she said.=20 Other critics have noted that wholesale power prices in California are=20 abnormally high during periods other than Stage 3 emergencies.=20 Feinstein's legislation first outlined in March would require FERC to set= =20 price caps or impose cost-based rates that would limit prices to the cost= =20 of producing the power plus a set profit margin. New generating plants and= =20 power bought through long-term contracts would be exempt.=20 However any state covered by the price controls would have to allow=20 utilities to recover their wholesale power costs from consumers. The clause= =20 helped draw a Republican co-sponsor to the bill Sen. Gordon Smith of Orego= n.=20 Smith and other Western lawmakers have complained about the reluctance of= =20 California officials to raise retail rates while consumers in neighboring= =20 states have seen their power bills soar. In recent months the California= =20 Public Utilities Commission twice has increased rates for customers of=20 Southern California Edison and Pacific Gas and Electric the utilities hit= =20 hardest by skyrocketing wholesale power prices.=20 The FERC staff proposal rejected price caps or cost-based rates.=20 It would be hard to devise price caps that are low enough to provide price= =20 relief but high enough to adequately compensate generators the proposal= =20 said.=20 The Bush administration and top congressional Republicans are opposed to=20 price controls so it is uncertain how far Feinstein's legislation will get= .=20 --- Grid officials declare a Stage 2 alert=20 ASSOCIATED PRESS=20 April 24 2001=20 SACRAMENTO =01) The state's electric grid operator declared a Stage 2 power= =20 alert Tuesday after two power plants suddenly went offline.=20 Higher-than-forecasted temperatures in Southern California also caused dema= nd=20 to increase said Lorie O'Donley spokeswoman for the Independent System=20 Operator keeper of the state power grid.=20 A Stage 2 alert is declared when electricity reserves fall or are expected = to=20 fall below 5 percent.=20 The two power plants that went offline had been producing about 1080=20 megawatts or roughly enough power for 810000 homes.=20 We think we may need to request interruptible customers but barring any= =20 other big problems we probably won't need to go to a Stage 3 said=20 O'Donley. Stage 3 alerts are called when the reserves drop below 1.5 percen= t=20 and could result in rolling blackouts like the state has seen on four days= =20 since January.=20 The ISO said 9900 megawatts were unavailable Tuesday morning because of=20 power plants that were down for scheduled or unplanned maintenance. Another= =20 3000 megawatts from alternative generators such as solar wind and=20 geothermal was also not available O'Donley said.=20 About half of the alternative generators say they can't afford to keep=20 operating because they are owed about $1 billion by Pacific Gas and Electri= c=20 Co. and Southern California Edison.=20 --- Top credit agency lowers California's bond rating=20 ASSOCIATED PRESS=20 April 24 2001=20 SACRAMENTO =01) A top credit agency lowered its rating on California state = bonds=20 Tuesday citing the growing financial drain from the continuing energy=20 emergency.=20 The downgrade reflects the mounting and uncertain cost to the state of the= =20 current electrical power crisis as well as its likely long-term detrimenta= l=20 effect on the state's economy Standard and Poors said.=20 The state's ability to repay is debts has been reduced though it is still= =20 adequate S&P said.=20 It dropped the rating on general obligation bonds from double-A to=20 single-A-plus. It similarly revised other lease ratings and ratings for th= e=20 California Health Facilities Construction Loan Insurance Fund known as Cal= =20 Mortgage.=20 S&P said it didn't drop the rating farther because the state still has mone= y=20 because of California's diverse economy and because a proposed revenue bon= d=20 is slated to reimburse the state's treasury for money California is current= ly=20 using to buy power for two financially strapped utilities.=20 If the state can't quickly sell its revenue bond the impact on the treasur= y=20 could be severe unless electricity rates are substantially increased beyond= =20 the large increases already scheduled to kick in S&P warned.=20 S&P has had the state's general obligation bonds on a credit-watch with=20 negative implications since January when the state began buying power for= =20 Southern California Edison and Pacific Gas and Electric.=20 --- State's Bond Rating Downgraded to A+=20 Finance: Reduction of 2 notches puts it among states with the lowest credit= =20 ratings. Move could cost California hundreds of millions in borrowing fees.= =20 By LIZ PULLIAM WESTON and MIGUEL BUSTILLO Times Staff Writers=20 ?????A major credit rating agency downgraded $25 billion of California bond= s=20 Tuesday in a move that could add hundreds of millions of dollars to the=20 state's borrowing costs and saddles California with one of the lowest state= =20 credit ratings in the nation. ?????Standard & Poor's Corp. cut California's bond rating by two notches= =20 from AA to A-plus citing the mounting and uncertain cost . . . of the=20 current electrical power crisis which has forced the state to spend=20 billions on electricity to keep the lights on. ?????S&P one of three major rating agencies monitoring California's=20 financial health said a further downgrade could occur if the state fails t= o=20 follow through on plans to issue at least $10 billion in revenue bonds to= =20 help pay off energy-related debts. ?????S&P is saying 'We don't have any faith that what you say you're goin= g=20 to do you're going to do' said Zane Mann publisher of the California= =20 Municipal Bond Advisor a newsletter that tracks government debt. ?????Wall Street is concerned by delays surrounding the electricity bond=20 issue but lawmakers hope to pass legislation this week to put the bond iss= ue=20 on a fast track and speed up return of the money to the state's general fun= d. ?????Credit ratings help determine how much states and other borrowers have= =20 to pay when issuing bonds. The lower the rating the higher the interest ra= te=20 the state must pay to entice investors to buy. ?????The state Treasurer's Office concluded in a preliminary estimate that = as=20 a result of the downgrade California could have to pay $190 million to $57= 0=20 million more on the $12 billion in general obligation bonds the state has= =20 authorized to pay for ongoing expenses such as school and road-building=20 projects but has yet to issue.=20 ?????State revenue bonds should not be affected by the downgrade the=20 officials said. However some bond experts disagree. ?????California's energy crisis already has driven down prices of a wide=20 range of the state's bonds from general obligation issues that depend on t= he=20 state's ability to repay to small issues by school districts and cities tha= t=20 could be hurt by rising electricity prices. Bond traders said S&P's downgra= de=20 probably would cause prices to fall further. ?????All California bond holders are going to lose value in their bonds=20 because the state's credit has been downgraded said John Fitzgerald=20 managing partner of Seidler-Fitzgerald a Los Angeles municipal debt=20 underwriter. ?????The downgrade most affects investors who want to sell their bonds now= =20 before the issues mature. Investors who hold onto their bonds are still=20 almost certain to get the face value when their securities reach maturity= =20 because the state is unlikely to miss any interest payments or otherwise=20 default on its bonds traders said. ?????S&P analysts said the state's continuing surplus and deep and diverse= =20 economy helped prevent a further downgrade. ?????Still the downgrade places California below most other states on S&P'= s=20 rating scale and on par with Hawaii. Among states rated by S&P only=20 Louisiana has a lower rating at A-minus according to Bloomberg News.=20 ?????In addition the two other major credit rating agencies have indicated= =20 they may downgrade California's bonds. Fitch Inc. said last week that it wa= s=20 contemplating such a move and Moody's Investors Service earlier this month= =20 changed its outlook on California bonds to negative from stable. ?????Some politicians Tuesday accused S&P of overreacting. ?????It's just unfair premature and inappropriate for them to do that. We= =20 do have reserves we do have good revenue projections we do have a plan to= =20 get us out of this said Assemblyman Gil Cedillo (D-Los Angeles). ?????In a statement Gov. Gray Davis said California's economy is still=20 fundamentally strong period. We expect that in 2001 we will continue to le= ad=20 the nation in economic growth and job creation. ?????State Treasurer Phil Angelides has been pleading with lawmakers to pas= s=20 legislation to speed up repayment of $5 billion drained from the state's=20 general fund to buy electricity this year. That figure is expected to reach= =20 $15 billion by year's end according to the governor. ?????The consequences of a downgrade are profound Angelides said noting= =20 that it took California years to overcome the downgrades spurred by the=20 recession of the early 1990s. ?????It is critical that the Legislature act immediately to clearly=20 establish our legal authority to sell bonds and replenish the state's gener= al=20 fund Angelides said. ?????California began buying massive quantities of electricity in January= =20 because the state's three major investor-owned utilities could no longer=20 afford to do so. Since then the state has been purchasing roughly one-thir= d=20 of the electricity the utilities need to service their customers according= =20 to state officials. ?????Under a plan approved by the Legislature and signed into law by Davis= =20 the general fund is supposed to be reimbursed for the power purchases with= =20 what is expected to be the largest municipal bond issue in U.S. history. Th= e=20 bond issue is to be repaid by utility ratepayers through a monthly charge o= n=20 their electricity bills. ?????However obstacles that threaten timely repayment of the fund are=20 causing consternation among Wall Street analysts about California's financi= al=20 status. ?????The bankruptcy filing of Pacific Gas & Electric Co. the state's large= st=20 investor-owned utility has thwarted the state's plan to restore the=20 utilities to financial health. ?????But it is a dispute over the state's formula for repaying the bonds th= at=20 has raised the most concern among state officials. The state and the=20 utilities are at odds over how much of consumers' electricity payments shou= ld=20 go to reimburse the state for its power purchases. ?????The state's two major utilities Pacific Gas & Electric and Southern= =20 California Edison have challenged the Public Utilities Commission's plan f= or=20 splitting up the money--a legal move that threatens to delay issuance of th= e=20 bonds. The firms contend the allotment granted to the state is too generous= =20 and could make it harder for them to recover from the energy crisis. ?????Hoping to sidestep the controversy Angelides is urging state lawmaker= s=20 to pass an emergency measure this week that sets the bond amount and the=20 amount the state will receive from utility payments. The revenue bond was= =20 initially expected to be $10 billion but the Davis administration has sinc= e=20 proposed a $12.4-billion issue. ---=20 ?????Times staff writers James Flanigan Jenifer Warren and Julie Tamaki=20 contributed to this report. Copyright 2001 Los Angeles Times=20 --- --- ----------------------- Price Controls Spark Deja Vu=20 Energy: The specter of Richard Nixon's actions 30 years ago hangs over=20 current debate on how to check the state's surging power costs.=20 By JAMES F. PELTZ Times Staff Writer=20 ?????A debate now rages in California over whether price controls should be= =20 adopted to stem the state's soaring power costs and help consumers who are= =20 bracing for huge spikes in their electric bills. ?????But price controls are one of the most controversial actions in=20 economics--and in politics for that matter. And now the caps are more in= =20 dispute than ever because they run counter to the nation's move over the la= st=20 two decades to deregulate more and more industries from airlines to=20 railroads to energy. ?????Yet California is a good example of deregulation gone haywire so=20 controls are again being demanded by lawmakers consumer advocates and othe= rs=20 as a way to check surging prices. On the other side is a chorus of critics= =20 who ridicule price caps as being ineffective and at times making matters= =20 worse for consumers. ?????Case in point: the Golden State itself which tried last summer to use= =20 temporary price caps to keep a lid on skyrocketing wholesale electricity=20 prices. ?????Critics claim that the caps drove power sales out of state thus=20 widening the imbalance between supply and demand reinforcing the existing= =20 shortages and contributing to this winter's rolling blackouts. ?????But defenders of the caps note that the dysfunctional California marke= t=20 had no way to self-correct. The utilities couldn't simply refuse to buy=20 electricity in the face of higher prices and with no price ceiling in sigh= t=20 something had to be done. ?????And now Gov. Gray Davis and others are again calling for temporary=20 controls until more electricity supplies can be added especially as the=20 state enters the peak-power summer season. On Tuesday Sens. Dianne Feinste= in=20 (D-Calif.) and Gordon Smith (R-Ore.) introduced legislation that would impo= se=20 price controls on wholesale energy throughout 11 Western states. ?????Mindful of the controversial history of controls Feinstein and Smith= =20 stressed that the caps would last only through March 1 2003. But they also= =20 argued that the economic damage to industries and consumers from escalating= =20 power costs would exceed any harm caused by price controls. ?????I have a strong preference for markets but it's a mistake to believe= =20 that we have a free market when it comes to energy said Smith the only G= OP=20 co-sponsor of the legislation. ?????Their bill would require the Federal Energy Regulatory Commission whi= ch=20 regulates U.S. wholesale electricity prices either to impose a regional=20 price cap or institute a rate schedule for each power generator tying the= =20 price of electricity to the cost of producing it. ?????Coincidentally FERC today is expected to decide on various other=20 proposals to again limit California's power costs--but without explicitly= =20 stating that the plans include price controls. Why? Because the Bush=20 administration and FERC Chairman Curt Hebert Jr. among others are on the= =20 record as adamantly opposing price caps. ?????That's not surprising. Price controls often are tagged as a liberal=20 maneuver that flies in the face of conservatives' free-market ideology. Yet= =20 ironically hanging over the California debate is the legacy of a Republica= n=20 president who was the last one to mandate price controls on a nationwide=20 level: Richard M. Nixon. ?????The late president took that rare step 30 years ago this August to try= =20 to quell inflation and spark an economic rebound. His actions were so=20 dramatic that they are still invoked by those wanting to criticize or in= =20 some cases endorse setting limits on prices. ?????What he did is almost larger than life now said Shannon Burchett= =20 chief executive of RiskLimited Corp. a strategic consulting firm in Dallas= . ?????Nixon's controls were the most far-reaching since World War II when= =20 prices were capped so that profiteers couldn't reap huge sums for scarce=20 commodities being used for the war and simultaneously rationed at home. ?????In most cases price controls have been much less sweeping and targete= d=20 at specific products or services. They don't always involve changing the la= w=20 either. In 1962 President Kennedy publicly rebuked the then-U.S. Steel Cor= p.=20 and its chairman Roger Blough for starting an industrywide move to raise= =20 steel prices. The price hikes were rolled back a few days later. ?????Since Nixon price controls have become rarer as industries that were= =20 once regulated--which means their prices were government-controlled--have= =20 been deregulated. ?????So it is in California where electric utilities' prices were controll= ed=20 for decades until the state's deregulation law in 1996. But now that the la= w=20 has been blamed for the soaring wholesale prices power shortages crippled= =20 utilities and the need for a huge jump in ratepayers' costs some again wan= t=20 price controls on electricity until the crisis eases. ?????Which brings everyone back to Nixon. ?????Some Nixon Controls Were Lifted by Reagan ?????I've heard people make the analogy to what happened . . . when Nixon= =20 put on controls but in California this is fundamentally different said= =20 Mike Florio a board member of the California Independent System Operator= =20 which oversees most of the state's electricity grid. ?????When you get into a situation of shortage [of supplies] there is=20 really no restraint at all on prices said Florio who said he normally=20 prefers unfettered markets but also defended the state's caps last summer.= =20 Such government intervention on a temporary basis is better than nothing= =20 but I don't think it's ideal. ?????The reverberations from Nixon's fiat aren't just felt in California=20 either. When New York Mayor Rudolph Giuliani recently proposed more stringe= nt=20 controls on wholesale electricity costs in New York state critics promptly= =20 pointed to Nixon's controls. They were a disaster one columnist wrote. ?????Even Federal Reserve Chairman Alan Greenspan who was in the private= =20 sector in the early 1970s turned down several requests to take high-level= =20 White House jobs in part because he was disgusted with Nixon's price contro= ls. ?????Many economists and historians also judge Nixon's controls as a mistak= e.=20 But some maintain that his decision--which began with a 90-day freeze on=20 prices wages and rents--wasn't entirely a failure and even provided shock= =20 value that for a while at least arrested higher inflation. ?????In addition part of Nixon's move involved taking the dollar off the= =20 gold standard--which in effect meant its price was controlled--and letting = it=20 float in value against other major currencies. And that many believe is t= he=20 base upon which today's global financial markets operate. ?????Others disagree. ?????There really isn't an example of where they've [price controls]=20 worked said Robert Goldberg a senior fellow at the National Center for= =20 Policy Analysis a nonpartisan think tank in New York. ?????Controls always lead to an underproduction of the commodity involved= =20 because producers don't have any incentive to spend more on additional=20 output he said. When the caps ultimately are lifted prices typically soar= =20 anyway as producers move to quickly recoup the profit they lost when the=20 controls were in place Goldberg added. ?????Others note that although most of Nixon's price controls lasted only a= =20 couple of years various forms of controls over crude oil and natural gas= =20 lasted for another decade until they were removed by President Ronald Reaga= n. ?????In the meantime the controls--aggravated by embargoes and other suppl= y=20 cuts by the Organization of Petroleum Exporting Countries--distorted the fr= ee=20 market for energy critics say. The controls kept U.S. oil prices=20 artificially low which in turn kept demand for oil high giving OPEC more= =20 power over world production and prices in the 1970s they contend. ?????Nonetheless proponents keep calling for controls when prices for=20 certain items seem to be spiraling out of control. ?????Critics Say Controls Worsen the Problems ?????President Clinton's massive health-reform proposal in the early 1990s= =20 included price controls on drugs. But the idea set off howls of protest fro= m=20 the pharmaceutical and biotechnology industries and ultimately the entire= =20 proposal was shelved. Consumer advocates and others also demanded federal= =20 controls on rising cable TV rates in 1997 and 1998 again contending that t= he=20 cable operators were hiking prices at a much faster rate than inflation.=20 Cable firms were allowed to keep passing certain costs on to their=20 subscribers but specific price caps weren't enacted. ?????But proponents of temporary price controls on California power emphasi= ze=20 that electricity isn't in the same category as an airplane seat steel or= =20 other commodities that don't have to be bought if the price soars too high. ?????In soybeans maybe the market can adjust quickly to changes in supply= =20 and demand but in electric generation in California it can't said Flori= o=20 who also serves as an attorney for the Utility Reform Network a consumer= =20 group. For most products one of the ways prices get determined is if buye= rs=20 refuse to buy when the price gets too high. But that's generally not an=20 option for people when it comes to electricity. ?????Critics of California's attempt to cap prices last summer said the=20 controls instead prompted many power suppliers to sell their electricity to= =20 other states. That actually made the tight-supply problem worse [in=20 California] by driving imports out of the state the Bay Area Economic=20 Forum a research group funded by regional business and government agencies= =20 said in a report last week. ?????Indeed the temporary caps were basically abandoned by year's end to= =20 keep enough electricity in the state. ?????Frank Wolak a Stanford University economics professor who heads the= =20 Independent System Operator's market surveillance committee said there are= =20 ways to mitigate the state's power prices without having to set rigid=20 controls. One proposal: Have FERC require that generators supply 75% of the= ir=20 expected future sales to California under long-term contracts at just and= =20 reasonable prices set by the federal agency he said. ?????That would send the right [price] signal to suppliers to come into th= e=20 state Wolak said. ?????And because it will take time for California to get more of its own=20 power-generating plants up and running the state's electricity crisis isn'= t=20 unlike a natural disaster in which normal public service is disrupted and= =20 short-term controls serve a purpose Florio said. ?????Over time market forces will work and controls shouldn't be need h= e=20 said. But does that mean we're supposed to pay $10000 per kilowatt-hour= =20 until something gets done? ---=20 ?????Times staff writer Ricardo Alonso-Zaldivar in Washington contributed t= o=20 this report. Copyright 2001 Los Angeles Times=20 --- --- ------------ Davis Names Executive to Speed Construction of Power Plants in State=20 Energy: Richard Sklar headed a building firm and worked for Clinton in=20 Bosnia. Governor sees the crisis abating by fall.=20 By DAN MORAIN Times Staff Writer=20 ?????SACRAMENTO--With temperatures rising and electrical supplies strained= =20 Gov. Gray Davis on Tuesday tapped a former Clinton administration official= =20 and executives from major construction firms to help speed completion of=20 power plants. ?????Davis who predicted that the worst of the energy crisis will abate by= =20 the fall announced that he has retained Richard Sklar 67 former presiden= t=20 of a construction firm to head a team that will help accelerate the buildi= ng=20 of power plants. ?????Speaking to business leaders at a California Chamber of Commerce=20 convention in Sacramento Davis said Sklar's job will be to make sure ther= e=20 are no hurdles [and] to cut red tape. ?????Richard Sklar knows electricity Davis said. He knows how to find= =20 megawatts. ?????Former President Bill Clinton sent Sklar to the Balkans in 1996 to try= =20 to help resolve the war in Bosnia-Herzegovina. Sklar arrived in Sarajevo to= =20 find that power was on for only two hours a day and set about expanding=20 electricity generation. ?????In an interview Sklar said his father was a mechanical engineer who= =20 designed power stations. ?????This power world is my world Sklar said adding that he had an=20 electric car and solar panels in the mid-1970s. ?????This Feb. 8 Davis announced at a news conference that he was appointi= ng=20 Larry Hamlin a vice president of Southern California Edison as his=20 construction czar. Hamlin's job was to speed power plant construction. ?????Davis spokesman Roger Salazar said that Hamlin's stint was temporary a= nd=20 that the executive must return to Edison. Sklar's contract is for a longer= =20 period Salazar said but it is unclear how long. ?????Sklar is being retained as a consultant paid $100000 initially. Othe= r=20 firms Salazar said are loaning employees as volunteers. Joining Sklar wil= l=20 be representatives of the engineering and construction firms Bechtel URS= =20 Corp. Engineering Fluor Daniel Parsons Brinckerhoff Quade & Douglas and = A.=20 Teichert & Sons. At least one Bechtel subsidiary is involved in power plant= =20 construction in California. ?????There is no conflict of interest Sklar said adding that no one in= =20 the group will have authority to decide who gets contracts. ?????A mechanical engineer Sklar was president of the San Francisco-based= =20 construction management firm O'Brien Kreitzberg Inc. Sklar's firm also=20 oversaw construction of the Metro Rail Green Line in Los Angeles and the=20 rebuilding of the Los Angeles Central Library. ?????He was also chairman of the San Francisco Public Utilities Commission= =20 under then-Mayor Dianne Feinstein. In that role he oversaw rebuilding of t= he=20 cable car system completing the work ahead of schedule--in time for the 19= 84=20 Democratic National Convention there. Feinstein's husband is a major invest= or=20 in URS one of the firms that will loan employees to Sklar's team. ?????He's very competent said state Senate President Pro Tem John Burton= =20 (D-San Francisco) of Sklar whom he met in 1972. He's a very good problem= =20 solver and he brooks no nonsense. . . . He's a renaissance man. He loves=20 music he loves politics and he's a gourmet cook. ?????Sklar has also displayed a sense of humor once donating to San=20 Francisco Zoo two capybaras rodents the size of a hog. He named one Quenti= n=20 and the other Kopp after a former San Francisco city supervisor and state= =20 senator who is now a Superior Court judge. ?????I'm 67 I've made all the money I need to make said Sklar who owns= a=20 vineyard near the Napa Valley town of Rutherford and has a home in San=20 Francisco. ?????My reputation is what's going to be at stake in this not the=20 governor's he said. I have a 40-year history of delivering--and that's= =20 what I'm going to do. I don't like to lose. ?????As Davis announced Sklar's appointment one of the governor's top ener= gy=20 advisors John Stevens resigned effective Friday. The governor praised=20 Stevens as a tireless worker. ?????Stevens worked on several energy-related tasks among them Davis'=20 efforts to keep utilities out of bankruptcy. Davis appointed him for a day = in=20 January to the state Public Utilities Commission on which he cast a key vo= te=20 to raise rates. ?????The state's power grid operators declared a Stage 2 emergency Tuesday= =20 afternoon as temperatures hit 90 degrees in downtown Los Angeles and two= =20 major power plants in Southern California unexpectedly shut down. Power=20 reserves dropped to nearly 5% below the minimum 7% that the California=20 Independent System Operator seeks to maintain. ?????Tuesday's emergency is not a predictor of worse electricity troubles t= o=20 come said Cal-ISO's Stephanie McCorkle because an unusually high number o= f=20 power plants are down for repairs that were planned months ago. ?????The plants not running Tuesday would be capable of supplying 10000=20 megawatts she said or about a third of Tuesday's peak demand. By mid-June= =20 no power plants should be shut off for scheduled maintenance McCorkle said= . ?????The state will lose more than 1000 megawatts of production starting= =20 this weekend when a unit of the Diablo Canyon nuclear power plant near San= =20 Luis Obispo is shut down for refueling. The shutdown planned a year ago= =20 will last 35 days according to Pacific Gas & Electric. ?????In his remarks Tuesday Davis said his goal is to boost the state's=20 energy supply to exceed demand 15% by 2003.=20 ?????This is probably the most complicated challenge the state has faced i= n=20 50 years Davis said. But we are providing steady and reliable leadership= =20 and I believe this thing will be behind us by the end of fall. ---=20 ?????Times staff writers Nancy Vogel and Jenifer Warren contributed to this= =20 story. Copyright 2001 Los Angeles Times=20 --- --- Power Plant Emits Tons of Fumes=20 Round-the-clock operation of old generators in Glendale and elsewhere=20 produces more than twice the old limits of pollution.=20 By JEAN GUCCIONE Times Staff Writer=20 ?????For the past five weeks Glendale's Grayson power plant has been=20 belching a half-ton of pollutants into the air almost daily more than twic= e=20 previous limits. ?????The same is true for many of the other 14 power plants in Southern=20 California as the haves generate power sometimes round-the-clock for th= e=20 have-nots. ?????The generators some of them nearly 50 years old and once considered t= oo=20 dirty for regular use now keep electricity flowing to fellow residents=20 around the state. And those living downwind are subjected to twice as much= =20 air pollution as before California's energy crunch. ?????Not every Glendale resident is happy. ?????You don't want anyone to get stuck with a rolling blackout but we ge= t=20 struck with the pollution Jerold Petrosian said as he and his family boug= ht=20 plants at a nursery across the street from the power plant. It is a tough= =20 decision. ?????Not so for Ignacio Troncoso director of Glendale Water & Power. Ther= e=20 is a pretty decent trade-off helping our neighbors in the state to keep=20 their lights on he said. ?????A USC specialist warned that increased power plant emissions raise the= =20 risks of asthma and other lung ailments in the young and old. ?????There is a potential for more emergency room visits more people seei= ng=20 their doctors and more hospitalizations this summer said Dr. Henry Gong= =20 professor of medicine and a specialist in the health effects of air polluti= on. ?????With extended hours the Glendale generators are emitting as much as 9= 95=20 pounds of pollutants into the air during peak demand more than double the= =20 old limit of 390 pounds a day city and air-quality officials said. ?????The other 14 power plants in Southern California also have more than= =20 doubled their overall emissions according to preliminary figures from the= =20 South Coast Air Quality Management District. As a group the plants emitted= a=20 total of 2045 tons of smog-forming nitrogen oxide in the first three month= s=20 of 2001 compared with 905 tons for the same period last year. ?????The AQMD hearing board on Tuesday eased pollution controls so Glendale= =20 may continue to generate excess electricity for sale to the energy-starved= =20 state. Under the plan Glendale may run three of its old steam boilers=20 around-the-clock to meet the state's energy demand. Usually these boilers= =20 hidden behind a tall brick wall sit idle except during the peak summer=20 demand because they are inefficient and costly. ?????Glendale like Burbank and the Los Angeles Department of Water and=20 Power continues to produce electricity at its city-owned plant. The three= =20 cities opted against participating in a scheme of deregulation a decision= =20 that has shielded their residents by and large from the huge utility rate= =20 hikes and rolling power outages experienced elsewhere. But they also will= =20 contribute to easing the state's energy emergency in the dirtier air they= =20 will be forced to breathe. ?????Air-quality officials said power plants contribute just about 3% of th= e=20 900 tons of pollution emitted into the air daily with about 70% of the=20 pollution coming from vehicles not factories. And in recent years many of= =20 the region's municipal power generators have been updated with=20 pollution-control devices that reduce emissions. ?????Glendale's three steam generators built between 1953 and 1963 are=20 inefficient by today's standards but they are 85% cleaner since the city= =20 pumped millions of dollars into upgrades. They will be even cleaner city= =20 officials say with more retrofitting. ?????Under the plan Glendale must reinvest profits from energy sales=20 estimated at $3 million to $5 million this year in equipment to reduce=20 future emissions at the plant and in community-based programs such as mobi= le=20 asthma clinics and programs to reduce school bus emissions. ?????The city plans to sell as much as 50 megawatts of power enough to ser= ve=20 50000 homes. Under the decision Tuesday pollution limits resume Jan. 1= =20 2002 or when the energy emergency ends. ?????In Los Angeles power officials said they don't expect to exceed AQMD= =20 caps because they are adding pollution controls at two of the city's four= =20 power plants. Although they will produce more electricity they should not= =20 produce any more nitrogen oxide which in sunlight and heat form ozone sai= d=20 Angelina Galiteva LADWP's director of strategic planning. ?????We will have much cleaner equipment in place by June she said. ?????Even the environmentalists are trying to balance the risks. ?????We realize we have a problem this summer. We have to run these plants= =20 said Sheryl Carter a senior policy analyst for the National Resources=20 Defense Council. ?????Carter said natural-gas-powered generators like the ones in Glendale= =20 are a far superior solution to diesel generators which produce 50 to 100= =20 times the emissions and would be turned on in businesses across the state i= f=20 energy is unavailable from other sources. ?????We are trying to make sure the environment overall is made whole sh= e=20 said. ?????Carl Zichella regional staff director for the Sierra Club said the= =20 generators should be run as a last resort. He also urged consumers to unplu= g=20 spare refrigerators and use energy-efficient light bulbs to reduce the=20 state's overall energy demand. ?????The only thing that is going to work to offset air pollution is=20 efficiency he said. Otherwise we will pay not only with higher rates bu= t=20 also with our health. ?????In neighboring Burbank city officials are preparing for peak summer= =20 energy demands when they expect to sell about 10% of their locally produce= d=20 electricity outside the city. ?????For four or five years we have been polluting Utah Arizona Nevada= =20 Washington and Oregon importing power to Los Angeles said Ron Davis=20 general manager of Burbank Water & Power listing the energy-producing stat= es=20 that typically produce the bulk of Southern California's power. We are=20 returning the favor. ?????Profits from those outside sales Davis said will help hold down=20 utility costs for local users. ?????I think most people would take a little more smog to guarantee there= =20 are no rolling blackouts he said. But it's not an easy question. Copyright 2001 Los Angeles Times=20 --- --- ---------- Power Plant Plan Worries Neighbors=20 Energy crisis: Regulators will decide next week whether to allow Huntington= =20 Beach facility to boost output. Noise and pollution are concerns.=20 By CHRISTINE HANLEY Times Staff Writer=20 ?????On Hula Circle in Huntington Beach families have tried to live with= =20 their two very different neighbors. They live steps from the Pacific Ocean= =20 but next door to the mechanical shrieks and foul smells of the massive AES= =20 Corp. power plant. ?????But California's power crisis is rapidly unhinging life in the=20 neighborhood of ranch houses and bungalows. ?????State regulators will decide next week whether to allow the company to= =20 double the plant's operations by July providing much-needed electricity bu= t=20 taking what residents fear will be a heavy toll on them. ?????It's one of several proposals to restart or build new power plants in= =20 the wake of the power crisis using a fast track process that allows the= =20 projects to go forward before environmental and pollution studies are=20 completed. ?????The plant is so close. We want to know if it is impacting our kids in= =20 ways we won't know about until 10 years from now said Janette Mortimer w= ho=20 lives with her husband and their two young children in one of the homes=20 closest to the plant. ?????Already residents say the AES plant is casting a mightier shadow.=20 There are the ear-ringing rumbles and roars. There are the mysterious plume= s=20 of smoke that waft over the neighborhood. Then there is the grime that seem= s=20 never to go away. ?????If the California Energy Commission approves the permit for AES the= =20 facility could run at full capacity for the first time in memory. Officials= =20 said the plant's previous owner Southern California Edison typically ran = it=20 at 30% of capacity. ?????AES could be allowed to run the four gas-fired boilers and a peaker= =20 unit whenever California hits a Stage 3 alert--which is expected to happen= =20 often this summer. The peaker plant alone is powered by eight jet=20 engines--and sounds like it. ?????Currently only two boilers are operating. ?????But residents say they are most worried about the air they breathe and= =20 the water they swim in. ?????Under the fast-tracking process designed to get more electricity for t= he=20 state as soon as possible several key environmental questions have yet to = be=20 studied. ?????Scientists studying the cause of ocean pollution that closed much of= =20 Huntington Beach's shoreline in the summer of 1999 said that the plant alo= ng=20 with other factors played a role by drawing partially treated sewage that = is=20 discharged miles offshore back toward the coast. ?????AES Inc. will pay $1.5 million to further study the issue but the=20 research won't be complete for some time. ?????So much is uncertain said Huntington Beach Councilwoman Shirley=20 Dettloff. These are big big things. ?????For now residents say they are bracing for more noise smoke and=20 disruption. ?????To begin with AES' proposal calls for 20 hours a day of nonstop=20 construction to get the two mothballed generators in service by July. ?????Then there are the sizzling summer temperatures. Residents usually ope= n=20 their windows to let the ocean breezes cool their homes. But the noise and= =20 smells from the plants may make that impossible. ?????It's going to be bad. There's no escape said Bryan Visnoski. ?????The plant has towered over the Huntington Beach coastline for nearly 4= 0=20 years. The housing tracts came later but most inhabitants of Hula Circle a= nd=20 surrounding streets seemed to make peace with their industrial neighbor. ?????Some have installed double-paned windows to dampen the sound. Others= =20 have remodeled their homes to obstruct ugly views. The Mortimers grew tall= =20 trees and trained vines past the windows. ?????The problems they say began with the energy crisis. ?????The plant was owned by Edison until 1998 when it was sold to=20 AES--California's largest private electricity producer--at the dawn of=20 deregulation. ?????The two gas-fired boilers that AES wants to restart have been dormant= =20 since 1995 and were slated for demolition until the power crisis struck. ?????But a few months ago as rolling blackouts hit the state Gov. Gray Dav= is=20 signed an executive order allowing peaker plants to operate at extended= =20 hours. Peaker plants can produce electricity in quick bursts but guzzle= =20 large amounts of natural gas and are noisy. ?????Hulu Circle residents said the order has resulted in more hours of lou= d=20 jet noises that make then feel like they live by an airport. ?????Whenever the peaker plant goes on residents call the Air Quality=20 Management District to send someone to test the plume of smoke. The=20 inspections have not detected any violations. ?????The proposal before the state Energy Commission would allow AES to=20 double its electricity output in Huntington Beach from 500 megawatts to 10= 00=20 megawatts. ?????The company's two 40-year-old units represent about 10% of the 5000= =20 additional megawatts Davis has promised to meet an expected energy shortfal= l=20 this summer. ?????Despite the fast-tracking process the company has vowed that it would= =20 safeguard against environmental damage and remedy any problems from plant= =20 operations. ?????If the plant is identified as drawing bacteria back to shore AES woul= d=20 have to pay the costs deemed necessary to fix problems. ?????This is little consolation to residents who would prefer a full=20 environmental review. Copyright 2001 Los Angeles Times=20 --- --- Federal plan called 'too little too late'=20 Limited price control seen as step in right direction but officials renew= =20 call for price ceiling Zachary Coile Chronicle Political Writer Wednesday April 25 2001=20 2001 San Francisco Chronicle=20 URL:=20 /25/M N104049.DTL=20 As federal energy regulators consider a plan intended to ease the state's= =20 worsening energy crisis California officials and some energy experts are= =20 already criticizing it as inadequate.=20 The Federal Energy Regulatory Commission is scheduled today to debate a=20 proposal that would force power generators to sell electricity at a=20 discounted price to California during severe power emergencies.=20 The proposal would require producers to sell energy to the state's power gr= id=20 during Stage 3 emergencies. Stage 3 emergencies are declared when energy=20 resources are almost depleted allowing utilities to cut off power to=20 customers at any time.=20 The plan also would limit how much energy firms could profit off such sales= .=20 But Gov. Gray Davis and Sen. Dianne Feinstein among others say stronger= =20 remedies -- including the temporary regional price limits they have advocat= ed=20 for months -- are needed to stave off a summer of blackouts and power=20 shortages.=20 I think the plan before FERC is too little too late Davis said yesterda= y=20 in Sacramento.=20 We need help all the time. The regulatory commission plan excludes 95=20 percent of the purchases of power. A Stage 3 situation is by definition= =20 chaotic as we scramble to find the megawatts to keep the lights on.=20 The commission ordered its staff in December to come up with remedies to=20 California's energy woes. The commissioners are expected to make their=20 decision by May 1 a self-imposed deadline to help the Golden State.=20 The proposal to be debated today would require producers to sell electricit= y=20 to California at a price based on the costs of the least-efficient plant=20 providing the energy. More efficient plants sending energy to the state wou= ld=20 still be able to make a sizable profit.=20 The plan has also drawn criticism because it applies only to California no= t=20 other Western states that are also feeling the pinch of higher energy price= s.=20 But California officials say the proposal does signal a shift in the hard-= =20 line position of the commission's majority against any form of price=20 controls. The plan would set some form of price ceiling even if only durin= g=20 extreme conditions.=20 In regulatory commission documents the plan is referred to as price=20 mitigation -- not price limits.=20 I sincerely don't believe that FERC would even be considering the Stage 3 = if=20 it were not for us making substantial noise about a temporary cap said=20 Feinstein D-Calif. who introduced a bill with other Western senators=20 yesterday to require the agency to impose temporary price controls on energ= y=20 sold to Western states.=20 Severin Borenstein director of the University of California Energy=20 Institute said the regulatory commission has yet to make a compelling case= =20 for why its Stage 3 plan would help lower sky-high prices.=20 The argument being made to support this is that firms are only able to=20 exercise market power during Stage 3 emergencies Borenstein said. And th= e=20 evidence is quite clear that's just not true.=20 It's unfortunate that FERC thinks this is solving some problem for=20 California because it won't.=20 E-mail Zachary Coile at zcoile@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 10=20 --- S&P lowers California's bond rating=20 First cut since '94 could cost taxpayers millions=20 Kathleen Pender Chronicle Staff Writer Wednesday April 25 2001=20 2001 San Francisco Chronicle=20 URL:=20 /25/M N211494.DTL=20 Citing the rapidly escalating uncertainty surrounding the power crisis= =20 Standard & Poor's slashed California's credit rating yesterday for the firs= t=20 time since 1994 when the state was still climbing out of a recession.=20 The downgrade -- and the energy debacle that led up to it -- will cost=20 taxpayers tens or hundreds of millions of dollars a year by raising the=20 state's borrowing costs. Investors will probably see the market price of=20 California municipal bonds and bond funds decline further.=20 But the biggest blow may be to the state's ego. S&P downgraded the state's= =20 general obligation bonds two notches -- to A+ from AA. The only other state= =20 currently rated A+ is Hawaii. The only state with a lower credit rating is= =20 Louisiana according to S&P.=20 Most states are rated AA. Some states don't have a credit rating because th= ey=20 don't have bonds.=20 California's credit rating is still investment grade which means it is n= ot=20 expected to default on its bonds. However the state's ability to repay its= =20 debt isn't as strong as it used to be said Steve Zimmermann a managing= =20 director with Standard & Poor's. This is a very speculative situation.=20 States hire companies like S&P to give them an independent credit rating wh= en=20 they borrow money by selling bonds. The rating reflects the state's ability= =20 to repay its debt in full on time.=20 When they sell new bonds states with lower credit ratings usually pay high= er=20 interest than higher-rated states to make up for the added risk.=20 A rating change does not affect the interest rate states pay on bonds that= =20 have already been issued but it can affect the price of bonds when they=20 trade on the open market among investors.=20 Yesterday's downgrade reflects the mounting and uncertain cost to the stat= e=20 of the current electrical power crisis as well as its likely long-term=20 detrimental effect on the state's economy S&P said in a news release.=20 Given the large magnitude of the problem in relation to the size of fund= =20 balances the state typically budgets the capacity to pay debt service whi= le=20 still adequate has been reduced.=20 In January S&P placed the state's debt on CreditWatch with negative=20 implications a signal that it might lower the rating.=20 In an unusual move S&P kept the state on CreditWatch after yesterday's=20 downgrade which means the rating could fall even lower.=20 Zimmermann said S&P is keeping California on CreditWatch pending its abilit= y=20 to sell $10 billion to $14 billion worth of bonds to reimburse the state's= =20 general fund for past and future power purchases.=20 If they did the bond issue they'd replenish the fund at least for the=20 short term. If they don't do it then it's more of a concern Zimmermann= =20 said.=20 Unfortunately the downgrade could make it harder for the state to sell the= =20 bonds.=20 If they could have gotten the deal done before the downgrade they would= =20 have had a stronger deal said Kelly Mainelli a municipal bond fund manag= er=20 with Montgomery Asset Management.=20 California must obtain an investment-grade rating (BBB- or higher) on the= =20 bonds before it can sell them.=20 Mainelli said California municipal bond prices have already fallen in=20 anticipation of a ratings cut. When prices fall bond yields go up.=20 The downgrade is the culmination of everything that's happened since early= =20 December he said.=20 In November California municipal bonds yields were 0.4 to 0.5 percentage= =20 points below the national average. Today they're 0.1 to 0.2 percentage=20 points above the national average and Mainelli thinks they could go up 0.1= =20 to 0.2 percentage points more because of the downgrade.=20 The total difference -- about 0.7 percentage points -- doesn't sound like= =20 much but it adds up.=20 Last year the state itself sold $4.6 billion in new bonds (excluding bonds= =20 sold to replace existing bonds). If it sells the same amount this year plu= s=20 $12 billion in energy bonds that 0.7 percentage point difference on $16.6= =20 billion in bonds would cost the state $116 million a year in additional=20 interest costs.=20 Yesterday's downgrade only affected the state's general obligation bonds an= d=20 others secured by the full faith and credit of the state such as the=20 California Health Facilities Construction Loan Insurance Fund (Cal Mortgage= ).=20 But the energy debacle could wind up costing other municipal bond issuers i= n=20 California -- such as cities counties school and water districts -- more= =20 money when they sell bonds. Although their ratings have not changed because= =20 of the energy crisis analysts say the yields on most California municipal= =20 bonds have gone up and will go up some more as a result of the state's=20 downgrade.=20 The values of all California bonds will be hurt by this downgrade whether= =20 they should be or not. Psychologically it's just how the market reacts= =20 says Richard Goldstein a San Ramon financial planner.=20 Investors who have to sell their California bonds on the open market before= =20 they mature may not get all their principal back. But investors who hold=20 their bonds until maturity will probably get paid in full Goldstein said.= =20 No matter how bad the energy crisis gets most experts believe the state wi= ll=20 continue making principal and interest payments on its bonds even if it ha= s=20 to raise taxes cut expenditures or run a temporary deficit to do so.=20 There's also the prospect at some point of federal help Goldstein said.= =20 The federal government does not want California to default or even come=20 close.=20 Do you know what that would do to the national economy and the world=20 economy?=20 California's bond-rating history=20 S&P cut its rating on California debt yesterday for the first time since=20 1994.=20 What credit ratings mean=20 -- AAA: Extremely strong capacity to meet financial commitments.=20 -- AA: Very strong capacity to meet financial commitments.=20 -- A: Strong capacity to meet financial commitments but somewhat more=20 susceptible to adverse circumstances and economic conditions.=20 -- BBB: Adequate capacity to meet financial commitments. However adverse= =20 economic conditions could weaken ability to pay debts.=20 Note: Ratings below BBB are considered poor investment risks and the issue= s=20 sometimes are called junk bonds.=20 Source: Standard & Poor's=20 Chronicle Graphic=20 E-mail Kathleen Pender at kpender@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- NEWSMAKER PROFILE=20 Richard Sklar=20 Ex-Muni boss becomes energy czar=20 Davis' pick to oversee power plant construction=20 Greg Lucas Sacramento Bureau Chief Wednesday April 25 2001=20 2001 San Francisco Chronicle=20 URL:=20 /25/M N232441.DTL=20 Sacramento -- San Franciscan Richard Sklar onetime trouble-shooter for the= =20 Municipal Railway and later a figure in the U.S. aid effort for Bosnia wil= l=20 head a team of construction experts working to build power plants faster= =20 Gov. Gray Davis said yesterday.=20 Sklar 66 is the second energy czar the governor has appointed in a week= .=20 Last week he named S. David Freeman head of the Los Angeles Department of= =20 Water and Power to lead the state's conservation efforts.=20 Mr. Sklar is with us for the long haul Davis said after speaking to the= =20 State Chamber of Commerce. He's a no-nonsense person.=20 Sklar will work with representatives of some of the largest construction=20 firms in the world such as Bechtel to map out timelines and identify=20 potential problems in building power plants.=20 Under the Davis administration 13 power plants have been approved eight o= f=20 which are under construction.=20 This is the red meat I chew on my friend Sklar said yesterday in a=20 telephone interview from New York.=20 We're going to be getting these projects under way and follow them from th= e=20 'let's do it' stage to the day we cut the ribbon.=20 Sklar has already had a chance to study the energy situation in California= =20 from afar. In January while serving as then-President Bill Clinton's point= =20 man for helping southeast Europe move toward capitalism Sklar said=20 California is an object lesson in how not to deregulate. You've got to hav= e=20 both capitalism and regulation.=20 The way California worked deregulation Sklar said was a colossal mistake= .=20 =20 Sklar has more than 35 years of public and private management experience= =20 much of it in San Francisco.=20 He came to the city from Cleveland in the mid-1970s and soon joined the=20 mayoral campaign of the late George Moscone. Impressed by Sklar's drive=20 Moscone handed him the reins to the city's huge wastewater program.=20 Sklar known as a man of limitless self-confidence quickly made a name for= =20 himself as a head-knocking administrator with an abrupt management style b= ut=20 he got the languishing program moving.=20 Citing Sklar's vigor and force then-Mayor Dianne Feinstein appointed him= =20 general manager of the San Francisco Public Utilities Commission which=20 oversees the city's Water Department. He held the post until 1983 while als= o=20 leading the Muni for three years.=20 Sklar soon earned a reputation at City Hall for flamboyance. Critics said= =20 Sklar enjoyed seeing his name in print and his face on TV a bit too much. H= e=20 took the criticism in stride.=20 I inspire intense feelings he told The Chronicle in 1982. You love me o= r=20 you hate me -- and probably for good reason.=20 By the end of his tenure Feinstein and Sklar were feuding openly over=20 everything from the Muni to high-rise development. The mayor called him=20 arrogant. He in turn called her a lightweight who was no great=20 political star.=20 From 1983 through 1996 Sklar worked for San Francisco-based O'Brien-=20 Kreitzberg one of the largest construction management firms in the United= =20 States. The firm specializes in public works projects.=20 Sklar became the company's president in May 1995 after running O'Brien-=20 Kreitzberg's Eastern and international operations a job that led to=20 Clinton's naming him to coordinate the rebuilding of war-ravaged Bosnia in= =20 1996.=20 During Sklar's year on the job the Sarajevo airport was quickly reopened= =20 and round-the-clock electricity was restored in the city before winter.=20 In 1997 Clinton named Sklar ambassador to the United Nations for reform an= d=20 management. His primary task was to shake loose from a reluctant GOP-=20 controlled Congress more than $1 billion in delinquent dues owed by the=20 United States.=20 In June 1999 he moved to Rome to serve as Clinton's point man on economic= =20 development of southeast Europe. He is now a mediator specializing in=20 construction cases.=20 E-mail Greg Lucas at glucas@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 10=20 --- Will price caps deter investment as federal regulators say?=20 KAREN GAUDETTE Associated Press Writer Wednesday April 25 2001=20 2001 Associated Press=20 URL:=20 tate0 343EDT0117.DTL=20 (04-25) 00:43 PDT SAN FRANCISCO (AP) -- Some key power generators say=20 California's dearth of energy supplies and its growing demand make it a= =20 good place to build more plants and sell more power in the years to come --= =20 even if dreaded price caps are imposed.=20 ``Regardless of what the (market) structure turns out to be the state's=20 going to need electricity and it's going to need to buy it from somebody''= =20 said Bill Highlander spokesman for San Jose-based Calpine Corp.=20 Calpine is investing about $4 billion in power plants over the next four=20 years that will generate 9000 megawatts enough for more than 6 million=20 homes. The state's current energy crisis ``hasn't really changed our plans = or=20 our strategy'' he said.=20 But Chief federal energy regulator Curtis Hebert says price caps on wholesa= le=20 electricity will hinder not help California's energy crisis.=20 Energy wholesalers seeking higher prices than California is willing to pay= =20 will invest in other states warns Hebert the chairman of the Federal Ener= gy=20 Regulatory Commission. And any regulations that cut into future profits wil= l=20 scare away desperately needed new power plants he says.=20 Eight of the 13 new power plants approved in California already are under= =20 construction. Twelve more are under review according to the California=20 Energy Commission which approves power plants.=20 CEC spokesman Rob Schlichting said that's a huge boost over the last decade= =20 when uncertainty over the rules of deregulation -- not a threat of price ca= ps=20 -- kept applications down. No companies have withdrawn plans to build plant= s=20 since December.=20 ``The only way price caps would scare away investment is if they were set s= o=20 low you couldn't make a profit'' Schlichting said. ``It's still a market= =20 that people seem to want to come in and produce power for.''=20 Other companies still planning to invest in California include North=20 Carolina-based Duke Energy which has two plants in the works and=20 Houston-based Reliant Energy which is negotiating with the state to sell= =20 power on long-term contracts.=20 Reliant's spokesman Richard Wheatley wouldn't say whether price caps alon= e=20 would inhibit them from building more plants. What he did say is that=20 California's power politics leave a lot of room for improvement.=20 The state has considered taking over power plants through eminent domain an= d=20 implementing a windfall profits tax to take some of their earnings away.=20 Meanwhile Attorney General Bill Lockyer is offering a bounty for any=20 information that could prove wholesalers worked together to drive up prices= =20 which could lead to more lawsuits and investigations.=20 If California wants to encourage construction it's got to tone down its=20 vilification and stop adding more restrictions Wheatley said.=20 ``Whenever we go into an area and consider building a power plant we have = to=20 look at the economics of the facility we have to look at the regulatory=20 situation esoteric things like what the mindset is like'' he said.=20 ``California is not the easiest place in which to do business.''=20 Some power companies have invested so much in pipelines gas reserves and= =20 plants already under construction that it's folly to turn back now.=20 ``We want to build in California but we need to have regulatory stability = or=20 at least regulatory clarity to move these things forward because they're=20 half-billion dollar projects in some cases'' said Tom Williams a spokesma= n=20 for Duke. ``That's a lot of bananas.''=20 Senators Dianne Feinstein D-Calif. and Gordon Smith R-Ore. plan this we= ek=20 to introduce legislation urging FERC to impose a temporary price cap over t= he=20 11 Western states. They hope to keep prices down in the short-term and give= =20 California and other troubled states a breather to make long-term decisions= .=20 Feinstein's bill does not yet specify a price. Some economists say $150 to= =20 $250 per megawatt hour would be just and reasonable yet provide generators= a=20 profit. Prices have gone as high as $1500 for the same amount of power in= =20 the past year.=20 Tying the price cap to the cost of making power could make it easier for=20 generators to swallow said Severin Borenstein director of the University = of=20 California Berkeley's energy institute. Such a cap would account for=20 variables such as the wildly fluctuating cost of natural gas used to genera= te=20 much of the energy in California's power plants.=20 Price caps can be effective but only if they are very carefully designed= =20 warned Frank Wolak chairman of the Independent System Operator's market=20 surveillance committee. The ISO manages the state's power grid.=20 Set them too high and companies will only bid that amount saving little= =20 money Wolak said. Too low and the generators could choose to sell elsewhe= re=20 unless all other nearby states have the same price limits.=20 Also capping the most expensive energy sales -- power sold on the spot=20 market at times of high demand -- won't lower prices for other key componen= ts=20 of the state's energy supply such as electricity bought for the next day's= =20 power needs.=20 ``Suppose you're paying $150 every single (megawatt) hour. That still puts = us=20 in big trouble with wholesale energy costs'' Wolak said.=20 The state already has spent $5.1 billion buying power for customers of=20 California's three largest investor-owned utilities which lost their credi= t=20 -- and thus their ability to buy power -- after paying sharply higher costs= =20 for wholesale energy.=20 Borenstein said paying even $250 a megawatt hour is still preferable to the= =20 unknown particularly since economists have warned that there is virtually = no=20 upper limit to what energy companies can charge.=20 ``This summer we are going to be truly short of power and at those times th= e=20 price is going to be at the price cap and if we don't have a price cap th= ey=20 will be way above the price cap'' Borenstein said.=20 FERC remains opposed to price caps but after months of complaints the boa= rd=20 this week is considering a limited cap on the most expensive last-minute=20 power buys.=20 The proposal would cap California but not the rest of the West and order= =20 wholesalers to sell to the state during the most extreme power shortages.= =20 Though it provides some cushioning it does not address the high prices=20 California swallows the rest of the time. That's the point of Feinstein's= =20 bill.=20 ``The crisis point is this summer to next summer and we need some federal= =20 assistance'' said Howard Gantman spokesman for Feinstein. ``This would=20 assure the generators a reasonable profit and continue to spur on further= =20 investment into new plants.''=20 On the Net:=20 California Energy Commission: www.energy.ca.gov=20 2001 Associated Press ?=20 --- Credit agency cites power troubles lowers state's bond rating=20 Wednesday April 25 2001=20 2001 Associated Press=20 URL:=20 tate0 552EDT0127.DTL=20 (04-25) 02:52 PDT SACRAMENTO Calif. (AP) -- A major credit rating agency h= as=20 downgraded California's state bonds citing the financial drain from the=20 continuing energy crisis.=20 ``The downgrade reflects the mounting and uncertain cost to the state of th= e=20 current electrical power crisis as well as its likely long-term detrimenta= l=20 effect on the state's economy'' Standard & Poors said Tuesday.=20 The state's ability to repay its debts while still considered adequate ha= s=20 been reduced S&P said in dropping the rating on California's general=20 obligation bonds by two notches from AA to A+. It similarly revised other= =20 lease ratings and ratings for the California Health Facilities Constructio= n=20 Loan Insurance Fund known as Cal Mortgage.=20 S&P is one of three major rating agencies watching the state's financial=20 performance. Credit ratings help determine how much states and other=20 borrowers must pay when issuing bonds. The lower the rating the higher the= =20 interest rate the state must pay to attract bond investors.=20 The downgrade now puts California's credit rating behind many other states= =20 and on par with Hawaii which also has an A+ rating from S&P.=20 Preliminary estimates from the state's Treasurer's Office estimated that th= e=20 downgrade would cost the state an additional $190 million to $570 million o= n=20 the $12 billion in general obligation bonds that have been authorized but= =20 not yet issued for ongoing expenses including school and transportation= =20 projects.=20 The agency said the rating was not reduced further because of California's= =20 diverse economy and a proposed revenue bond slated to reimburse the state's= =20 treasury. S&P said a further downgrade could occur if California does not= =20 follow through on plans to issue more than $10 billion in revenue bonds to= =20 pay off its energy-related debts.=20 The agency put the state's general obligation bonds on a credit-watch ``wit= h=20 negative implications'' Jan. 19 shortly after California began buying powe= r=20 for its two largest utilities Southern California Edison and Pacific Gas a= nd=20 Electric Co.=20 On the Net:=20 Standard & Poors www.standardandpoor.com=20 2001 Associated Press ?=20 --- S&P downgrades California's bonds citing energy troubles=20 Wednesday April 25 2001=20 2001 Associated Press=20 URL:=20 ation al0443EDT0483.DTL=20 (04-25) 01:43 PDT SACRAMENTO (AP) -- A major credit rating agency has=20 downgraded California's state bonds citing the financial drain from its=20 continuing energy crisis.=20 ``The downgrade reflects the mounting and uncertain cost to the state of th= e=20 current electrical power crisis as well as its likely long-term detrimenta= l=20 effect on the state's economy'' Standard & Poors said Tuesday.=20 The state's ability to repay its debts while still considered adequate ha= s=20 been reduced S&P said in dropping the rating on California's general=20 obligation bonds by two notches from AA to A+.=20 The agency said the rating was not reduced further because of California's= =20 diverse economy and a proposed revenue bond slated to reimburse the state's= =20 treasury. S&P said a further downgrade could occur if California does not= =20 follow through on plans to issue more than $10 billion in revenue bonds to= =20 pay off its energy-related debts.=20 The agency put the state's general obligation bonds on a credit-watch ``wit= h=20 negative implications'' Jan. 19 shortly after California began buying powe= r=20 for its two largest utilities Southern California Edison and Pacific Gas a= nd=20 Electric Co.=20 On the Net:=20 Standard & Poors www.standardandpoor.com=20 2001 Associated Press ?=20 --- State bond rating lowered=20 Posted at 10:53 p.m. PDT Tuesday April 24 2001=20 BY JENNIFER BJORHUS=20 Mercury News=20 One of Wall Street's top credit-rating houses has downgraded California's= =20 bonds because of the state's handling of the energy crisis a move that cou= ld=20 ultimately cost taxpayers tens of millions of dollars.=20 Saying that mounting and uncertain power costs are likely to do lasting har= m=20 to California's economy New York-based Standard & Poor's on Tuesday lowere= d=20 the state's credit rating on its ``general obligation'' bonds two notches= =20 from AA to A+ with a negative outlook. That puts California near the bottom= =20 of the state bond heap with only one state -- Louisiana -- rated lower.=20 Standard & Poor's said the rating could go lower if the state cannot resolv= e=20 the power crisis.=20 The downgrade will cost California millions of dollars in coming years=20 because a lower rating makes it more expensive for the state to issue gener= al=20 obligation bonds to finance projects such as school construction.=20 The interest on those bonds which will rise from an estimated 5 to perhaps= =20 5.25 percent is paid from the state's tax-financed general fund. Although= =20 the rating change doesn't apply technically to the different type of bond t= he=20 state plans to issue by June for power purchases it will probably make tho= se=20 bonds more expensive for the state too bond experts say.=20 Heightened urgency=20 ``There's a sense of urgency that this problem has been escalating=20 particularly since the PG&E bankruptcy'' said David Hitchcock California= =20 analyst for Standard & Poor's. ``This problem could move quickly.''=20 At least one bond expert said the downgrade was surprising.=20 ``To me it's clear that S&P doesn't have much faith in this power-bailout= =20 plan of the Legislature and the governor. To me that's the reason they did= =20 it'' said Zane Mann publisher of the monthly California Bond Advisor=20 newsletter.=20 No single new piece of information triggered the downgrade Hitchcock said.= =20 The major factor he said was simply spiraling costs and no long-term plan= =20 for paying the bills. Last week Gov. Gray Davis said the state had been=20 spending $73 million a day to buy electricity up from $45.8 million a day = in=20 late March. Hitchcock said some energy traders suspect the actual costs are= =20 higher.=20 All three major Wall Street credit-rating agencies have California on=20 so-called ``credit watch'' but only Standard & Poor's has downgraded. One= =20 municipal bond expert said Standard & Poor's had been ``trigger happy'' and= =20 eager to downgrade. Raymond Murphy Moody's California analyst said he had= =20 no immediate plans to change California's bond rating but that he's anxiou= s=20 to see officials produce a long-term plan for financing power purchases.=20 Murphy said he had a conference call with state officials about the issue= =20 Tuesday morning.=20 ``We want the state to develop the plan that gets the general fund out of= =20 power purchasing'' Murphy said.=20 The state says it's working on that but there's a roadblock.=20 Revenue bonds=20 A major piece of the state's plan is to have the Department of Water=20 Resources issue $10 billion to $14 billion in revenue bonds to pay back the= =20 general fund for what has been taken to buy power in recent months. But tha= t=20 portion of the plan is tied up in a dispute between PG&E and the California= =20 Public Utilities Commission over how to spend the extra money generated by= =20 electricity rate increases. The dispute has also held up the $4.13 billion = in=20 financing the state had arranged to pay down the advances it took out of th= e=20 general fund to buy power.=20 To break the logjam officials from the state treasurer's office have asked= =20 lawmakers to pass emergency legislation to allow the state to issue the=20 revenue bonds.=20 ``California's credit rating and financial strength will be in jeopardy unt= il=20 the state's general fund is repaid for energy costs'' state Treasurer Phil= ip=20 Angelides said in a statement Tuesday.=20 State Finance Director Tim Gage and Gov. Davis both downplayed the=20 significance of the rate change. Through a press officer Davis said the=20 state's economy remains fundamentally strong.=20 The state was downgraded to a lower A rating in 1994 and went on to see=20 tremendous economic growth.=20 Mounting pressure=20 Still a downgrade is bad news that sends a psychological signal in both th= e=20 finance and real worlds. Some industry watchers said they hope the downgrad= e=20 pushes lawmakers and state officials whom they perceive to be too slow in= =20 responding to the crisis.=20 ``It sounds like the bond market might be out ahead of some of the=20 policy-makers in California'' said Severin Borenstein director of the=20 University of California Energy Institute. ``We're facing a real emergency= =20 here.''=20 John Hallacy managing director of municipal research at Merrill Lynch sai= d=20 a lower credit rating puts more pressure on the state to issue the revenue= =20 bonds fast and to conserve cash.=20 ``We're kind of at the critical juncture now where the pieces are still all= =20 over the floor'' Hallacy said of the state's efforts to build and approve = a=20 long-term solution to the power crisis.=20 To Nettie Hoge executive director of the Utility Reform Network and a=20 leading critic of the state's efforts to bail out PG&E and Southern=20 California Edison the downgrade means ``the analysts are watching.'' She= =20 said she hopes that President Bush and the Federal Energy Regulatory=20 Commission are watching too.=20 ``Hopefully this is a wake-up call for FERC. Those guys could solve this i= n=20 a nanosecond'' Hoge said. ``This is just another milepost on the downward= =20 spiral to economic catastrophe.''=20 Contact Jennifer Bjorhus at jbjorhus@sjmercury.com or (408) 920-5660.=20 --- --- ----- Q&A with Gov. Gray Davis on energy issues=20 Gov. Gray Davis visited the Mercury News editorial board Monday. On the=20 subject of electricity Davis talked about increasing the number of power= =20 plants the rejection of price caps by the Federal Energy Regulatory=20 Commission and the condition of the state's two largest utilities Souther= n=20 California Edison and Pacific Gas & Electric. Davis has proposed a deal to= =20 rescue Edison and the Legislature is considering it. PG&E has filed for=20 bankruptcy.=20 Here is a condensed version of Davis' remarks.=20 Q: What would you like to say by way of introduction about the state's=20 electricity problems?=20 Davis: There are really two problems. One is the amount of power available= =20 and the other is the price of power.=20 In 2002 we'll have more megawatts on line at least 5000 more. By 2003= =20 we'll have a slight excess of power over demand. That's very important.=20 Because at the moment we import 20 percent of our power. We have no=20 leverage. We are at the mercy of forces that show no mercy. That will never= =20 change until we have more power than we need.=20 OK price. As you know the only entity that can influence the [wholesale]= =20 price of electricity is the Federal Energy Regulatory Commission.=20 Deregulation surrendered the ability of the state to do that.=20 In 1999 this state for all power including municipal power spent roughly= =20 $7 billion. In 2000 we spent $32.5 billion. I don't know what it will be= =20 this year but it will be substantially higher.=20 Through all this the Federal Energy Regulatory Commission has refused to do= a=20 thing zero zippo. Lest you think I'm being partisan that commission=20 consists entirely of Clinton appointees.=20 The final piece is the financial consequences of what's happened to date. I= t=20 is our hope that if we can keep Southern California Edison credit-worthy an= d=20 able to re-enter the power purchasing market Jan. 1 2003 we can then go t= o=20 the PG&E creditors committee [the generators to whom PG&E owes money] and s= ay=20 to them: ``Look at the arrangement we made with Southern California Edison.= =20 We believe that this is a far better deal than PG&E can give you.''=20 I think this is a fair plan. We get every electron that Edison's utility ow= ns=20 committed for 10 years at a cost-of-service basis. Under [current law] the= y=20 could sell that next March at market rates. We got $400 million returned fr= om=20 the holding company a $3 billion investment in the transmission and delive= ry=20 systems .?.?. a permanent easement on about 20000 acres of environmental= =20 property around all their hydro facilities.=20 Q: Do you have in mind a finished product for the changes that are happenin= g=20 in the electric system? What will it look like in a couple of years?=20 Davis: It is my expectation that the utilities will be purchasing the power= =20 entirely commencing Jan. 1 2003. Our goal is to get them back in business= .=20 In addition to investor-owned utilities I believe we also need a public=20 power authority. At some point I believe the private sector will say to=20 itself ``I want to build new plants to replace the 40-year-old plants but= =20 do I really want to get the state to a 15 percent margin over supply there= by=20 reducing the value of the electrons I already own?'' If they do God bless= =20 them. But if they don't at least we'll have the opportunity to build them= =20 ourselves.=20 Once we have even a slight margin of capacity over demand the spot market= =20 prices will come down dramatically.=20 Q: You said in February that you could have solved the electricity problem = in=20 20 minutes if you'd been willing to raise rates. Now rates are going to be= =20 raised. Should you have favored a rate increase earlier?=20 Davis: I should have been more specific. I should have said I could have=20 solved it in 20 minutes if I wanted to triple rates. I think the rate=20 increase I proposed is fair. It rewards people who are the most energy=20 efficient the people who only use up to 130 percent of their baseline. The= y=20 are approximately half the state. So half the state will see no rate=20 increase beyond the 10 percent that everyone saw in January.=20 Q: Is the state willing to spend anything it costs to keep the lights on o= r=20 at some point would it stiff the generators and just say we will accept a= =20 blackout?=20 Davis: We have to provide power. There are many people who have medical=20 devices that have to keep running. Blackouts can cause deaths traffic=20 accidents all kinds of calamities that I wouldn't want to happen.=20 I'm reluctant to tell the generators we'll pay any price so I'm not going = to=20 say we'll pay absolutely any price but my bias obviously is to find a way = to=20 keep the lights on.=20 Q: When will you reveal how much electricity the state has bought from wha= t=20 companies at what prices and what this will cost the state this year and i= n=20 coming years?=20 Davis: We'll reveal an awful lot of information as soon as the bonds go to= =20 market. [The state plans a bond issue to cover the upfront costs of=20 purchasing electricity.] That information has to be made public. That will= =20 probably be in less than two months.=20 Believe me I don't like going around getting beat up for hiding informatio= n.=20 I'm doing it for one reason only which is that I know every additional edg= e=20 I give the generators will result in higher prices for customers.=20 Q: There's an impression that the state budget is being drained by the powe= r=20 crisis. Is that right?=20 Davis: The simple answer to that is no because the state will be fully=20 reimbursed with interest as soon as these bonds are sold.=20 At the moment in the short term it is crowding out other spending. But I= =20 think everyone understands that's a temporary phenomenon until the state i= s=20 reimbursed by bonds that are repaid over time through the rate structure th= at=20 I proposed.=20 Q: Would it be your pledge that ratepayers not taxpayers will fully repay= =20 the state's cost in purchasing electricity?=20 Davis: That is the assumption underlying these bonds. That's right as it=20 relates to electricity but obviously the conservation incentives came out = of=20 the general fund.=20 Q: Have you talked to President Bush about this?=20 Davis: I hear all these rumors as to why the Bush administration doesn't wa= nt=20 to be helpful but this state and particularly this region has been=20 disproportionately helpful in America's economic growth and technological= =20 productivity. If he wants America to grow it behooves him to keep Californ= ia=20 growing. To date I think it's fair to say that of my public requests=20 President Bush has been responsive to all but the price caps.=20 --- --- ------- Davis: Power surplus by 2003=20 Published Wednesday April 25 2001 in the San Jose Mercury News=20 BY DON THOMPSON=20 Associated Press=20 SACRAMENTO -- Even as power grid operators warned the state's lights could= =20 flicker again by week's end Gov. Gray Davis on Tuesday pledged that=20 Californians will be wallowing in electricity by the end of 2003.=20 Davis compared the emergency to fighting a large forest fire -- in a few=20 years the fire will be out and the state will be out of the energy-buying= =20 business.=20 Just in case Davis' plans fail however an Assembly task force is=20 considering options including having the state buy Southern California=20 Edison.=20 Critics have hammered Davis for his handling of the power crisis and his= =20 predictions have faltered before.=20 In January Davis set three goals as energy prices spiraled upward and shor= t=20 supply endangered the state's large investor-owned utilities: to avoid=20 blackouts bankruptcies and rate increases.=20 All three have since happened.=20 On Tuesday Davis lowered the bar substantially: ``If the lights stay on w= e=20 will have succeeded. Our goal is to keep the power flowing in this state t= o=20 avoid blackouts to moderate the price increases in a fair and reasonable w= ay=20 and reward those who conserve the most and to chart a steady course.''=20 Even keeping the lights on may be difficult as temperatures climb this week= =20 warned the Independent System Operator which runs the state's power grid.= =20 The ISO declared a Stage 2 emergency Tuesday afternoon when the state came= =20 within 5 percent of running out of electricity after two power plants went= =20 off-line unexpectedly.=20 Spring's first warm spell is likely to boost demand by 2000 megawatts -- t= he=20 equivalent of two large power plants able to power 1.5 million homes -- the= =20 ISO said in calling for more energy conservation.=20 The increase comes as hydroelectric power runs low across the dry Northwest= =20 and as 13000 megawatts of power remain unavailable due to planned or=20 unplanned plant shutdowns.=20 Davis insisted that statewide conservation this summer can stave off=20 widespread blackouts as the state rushes to build its way out of the supply= =20 shortage.=20 ``At the end of 2003 we will have more power than we need we will have=20 regained control of our energy destiny'' Davis promised in a speech to the= =20 California Chamber of Commerce. ``By the end of 2003 you can have all the= =20 appliances on. You can you know don't turn anything off you can just=20 luxuriate in all your electricity.''=20 Davis promised a 15 percent supply surplus by 2004.=20 To that end he named former diplomat Richard Sklar to head a new=20 ``generation implementation task force'' of business consultants charged wi= th=20 speeding up power plant siting and construction. Before entering public=20 service Sklar was president of San Francisco-based construction machinery= =20 manufacturer O'Brien Kreitzberg.=20 Standard and Poors dropped California's credit rating Tuesday warning that= =20 continued purchases could hurt the state treasury. --- --- ---------- Great America to avoid blackouts=20 Published Wednesday April 25 2001 in the San Jose Mercury News=20 Associated Press=20 Paramount's Great America amusement park in Santa Clara has struck a deal= =20 with the municipal utility to keep the power on even during rolling blackou= ts=20 this summer.=20 The park will cut electricity usage by 10 percent on ``high-demand days'' -= -=20 which could be nearly every day this summer -- by turning off fountains=20 decorative lighting and air conditioning in some buildings.=20 Santa Clara's city-owned utility Silicon Valley Power will use the power= =20 savings to help avert blackouts said Larry Owens customer service manager= =20 for the utility. Even if the situation gets dire and blackouts are required= =20 the park will be exempt because of the arrangement Owens said.=20 About 20 companies with facilities in Santa Clara including Intel Corp. S= un=20 Microsystems Inc. and Agilent Technologies Inc. have agreed to the same=20 arrangement as has Santa Clara University. --- --- ---------- State's bond rating is lowered=20 The energy crisis brings an A+ designation which likely will mean higher= =20 borrowing costs.=20 April 25 2001=20 By JOHN HOWARD The Orange County Register=20 SACRAMENTO California's electricity crisis prompted a top credit agency to= =20 downgrade the state's credit rating by two notches to its lowest level in= =20 seven years. The move is likely to force the state to pay millions of dolla= rs=20 more in interest when it borrows.=20 It's a statement from Wall Street to California to get your act together= =20 said Assemblyman George Runner R-Lancaster a GOP energy- finance expert i= n=20 the Assembly.=20 The ratings action is serious and should be a warning to the state that it= =20 is on the wrong course added Mark McCray a municipal-bonds manager at=20 Newport Beach-based Pimco. This downgrade will cost the state a lot in ter= ms=20 of increased financing and costs until if ever it is upgraded.=20 Standard and Poor's Corp. concerned about the $5 billion drained from the= =20 state's coffers to buy power this year cut California's credit rating from= =20 AA to A+. The reduction applies to voter-approved bonds called general=20 obligation or G.O. bonds that typically provide funds for schools parks= =20 water projects and highways.=20 About $19.3 billion worth of G.O. bonds have been approved by voters. About= =20 $12 billion have not yet been sold.=20 The credit-rating cut would force the state to pay higher interest rates to= =20 attract buyers to the unsold bonds. If the state were to sell all $12 billi= on=20 under the lower credit rating it could be forced to pay an additional $190= =20 million to $500 million annually in interest depending on market condition= s.=20 Shortly after Standard and Poor's announcement state Treasurer Phil=20 Angelides urged lawmakers to limit the size of the state's looming=20 electricity-bond sale to $10 billion - or $2.4 billion less than Gov. Gray= =20 Davis wants.=20 Angelides said capping the revenue bond at $10 billion would head off legal= =20 challenges from utilities expedite the passage of the bond plan through th= e=20 Legislature and allow the sale to go forward.=20 At a minimum we need an authorization of $10 billion Angelides said. If= =20 Davis and lawmakers want more they should do it later Angelides added.=20 Davis has sought $12.4 billion. The rift between the governor and the=20 treasurer both Democrats marks their sharpest political divergence since= =20 the energy crisis erupted last year.=20 A Davis spokesman declined to comment on the difference. We are working wi= th=20 the treasurer and others to draft legislation for that bond bill and we'll= =20 continue to work with him said Roger Salazar.=20 The Davis administration hopes to raise the money by selling revenue bonds= =20 backed by a charge on consumers' utility bills. The sale had been planned f= or=20 May but has since been pushed back to June or July at the earliest.=20 But there is a clock ticking: The state has been spending $45 million to $6= 0=20 million a day for electricity. The longer the delay in selling the bonds t= he=20 less money will be available to buy cheaper energy for the state under=20 long-term contracts.=20 Before funding future power purchases the bond proceeds must go to pay bac= k=20 the $5 billion the state has spent on electricity purchased since January o= n=20 behalf of California's three big cash-strapped utilities.=20 While the Standard and Poor's downgrade won't directly affect the electrici= ty=20 bonds since they won't be G.O. bonds it does reflect Wall Street's concer= n=20 about the unstanched outflow of state funds.=20 In my mind there's no doubt that S&P is doing this because they simply don= 't=20 have faith in the proposed bailout and what the state is going to have to g= o=20 through to solve its power problems' said Zane Mann the editor of a=20 newsletter that tracks California's general-obligation bonds.=20 Mann said the A+ rating puts California below average nationally. The=20 rating downgrade sliced the value of an existing 30-year California G.O. bo= nd=20 by 3.5 percent he said. But since most investors who buy California bonds= =20 hold them to maturity Mann said the losses would be largely confined to=20 paper.=20 Assemblyman Fred Keeley D-Boulder Creek who authored the bill that=20 authorized the power bonds said the sale should be limited to the $10=20 billion originally provided for in the bill. The bill provides for the=20 utilities to forward money collected from ratepayers to the state Departmen= t=20 of Water Resources which purchases the power.=20 As the state spent more than anticipated on emergency electricity purchases= =20 Davis sought to increase the size of the bond sale. But that suggestion has= =20 led the utilities to challenge the bill's rate- diversion mechanism which= =20 has put a cloud on our ability to acquire financing Keeley said.=20 Assembly Republican Leader Dave Cox of Fair Oaks said he would strongly=20 support any move to cap the amount of borrowing the state would do to buy= =20 electricity.=20 His staff said Republicans are skeptical that the ratepayers' revenues are= =20 sufficient to cover the costs in the Davis administration's electricity-=20 rescue plan.=20 Nobody believes that the revenue stream is wide enough to cover all the=20 governor's energy solutions. It's still being sucked up by the state's=20 utilities said Cox spokesman Jaime Fis Fis.=20 Register staff writers James B. Kelleher and Diana McCabe and the Associate= d=20 Press contributed to this report.=20 --- --- --------------------------- Fire stokes wholesale gas cost=20 The question is whether the retail price will climb too.=20 April 25 2001=20 By ANNE C. MULKERN The Orange County Register=20 The Tosco refinery fire may fuel rising prices on the gasoline retail marke= t.=20 The spot-market price rose 10 cents within hours of the fire. Photo: Leonard Ortiz / The Register ? ? Wholesale gasoline prices jumped Tuesday a day after fire erupted at Tosco= =20 Corp.'s Carson refinery.=20 But energy experts said it is too soon to know whether the fire will drive= =20 retail gas prices higher.=20 Gas prices already are climbing because of increased demand heading into=20 summer higher costs for additives that make cleaner-burning fuel and a shi= ft=20 in marketing strategy by Tosco which wants to sell less gas at a higher=20 price.=20 The refinery fire has the ability to worsen an already bleak situation=20 energy experts said.=20 It doesn't take much in this market'' said Suzanne Garfield California= =20 Energy Commission spokeswoman. It's very volatile.''=20 Tosco said it will shift any lost gasoline production to its Wilmington=20 refinery. It was unclear however how long the Carson refinery would be do= wn=20 for repairs. Tosco spokesman Clark Wrigley couldn't say whether the=20 Wilmington plant could make enough gasoline to meet the company's needs in= =20 Southern California.=20 Within hours of the fire gas prices had jumped 10 cents per gallon on the= =20 spot market a daily market where refiners sell surplus supplies. That was= =20 driven mainly by speculation as those with gas to sell waited to see how= =20 high the price would go. Prices later fell back to an increase of about 3= =20 cents from a day before.=20 Just the fact that there is a hiccup in the refinery makes everyone cringe= =20 and say 'I'm not going to sell''' said Bob van der Valk manager at Cosby= =20 Oil a Santa Fe Springs gasoline wholesaler.=20 A day or so of higher spot prices probably won't affect retail costs. But i= f=20 wholesale prices stay up for several days retailers will pass on those cos= ts=20 to consumers.=20 --- --- --------------------------- Power Companies and Regulators Must Take Steps To Avoid Spread of=20 California Power Virus/ Andersen Analysis WASHINGTON--(BUSINESS WIRE)--April 24 2001 via NewsEdge Corporation - A new virus spawned in California poses formidable challenges requiring new strategies on the part of power companies regulators and policymakers to contain and reverse its damage according to Energy Crisis in the Western United States: Lessons for Navigating Regulatory and Market Minefields a new Andersen report released today. The implications for the development of competitive energy markets go far beyond the Western United States Andersen's national utility practice head Matthew D. Smith told a Washington briefing. Unfortunately California has taught the nation that regulatory and political barriers can create and sustain an energy crisis. California has demonstrated that the risks in the electricity industry if not properly acknowledged and managed can simultaneously and profoundly impact all market participants. To be effectively managed these risks need to be exposed assumed or shared measured and monitored. When they are hidden or ignored all parties can potentially suffer. A shared integrated view of these risks and a strategy for their assumption and management is critical to avoiding rapid value destruction within the energy market Smith said. An Andersen survey of senior utility executives outside California also released at the briefing indicates most utility companies believe they inoculated themselves against the California virus so that it is unlikely to affect their operations beyond slowing the pace of deregulation and increasing investor scrutiny. However based on the potential implications it sees of the California situation Andersen believes a series of booster shots are advisable for power companies and regulators. To deliver reliable service at a predictable cost in today's environment companies must focus on market integration by developing new and innovative relationships between suppliers customers employees and investors -- while working with government officials and regulators to chart a smoother transition to a deregulated power market according to Smith. Eight Implications The Andersen report identified eight overriding implications emanating from the Western energy crisis that are shaping the longer-term operations of the Western grid the regional and national economy domestic energy policy and the industry's evolution: 1. Increased deregulation uncertainty and risk -- Tension and differences between state and federal regulators raise the specter of repeating the regulatory and political conundrum California's investor-owned utilities have faced. If federal initiatives open wholesale markets while retail markets remain regulated a crucial question is raised: Will state regulators pass-through higher wholesale costs if they should materialize? Tensions between state and federal regulators over policies on deregulation will grow if states delay or abandon retail competition. As wholesale markets are deregulated and RTOs begin operating the prudence principles that state regulators have used for many years may have to be changed. For example if FERC and RTO monitors determine that deregulated wholesale markets operate fairly prices derived from those markets must be considered reasonable. If so these costs should be allowed into state-regulated retail rates without regard to the prudence principles state regulators have used for years. Therefore utilities' traditional burden of proving costs are or are not justifiable shifts to regulators. 2. Reduced investor confidence -- Prior to deregulation stringent prudence review and disallowance of generation costs in the rate base made regulatory risk largely uncontrollable killing IOU interests in most new investment. A major purpose of deregulation was to create an environment in which risk could be managed but California's political and regulatory environment provides only a limited ability to manage risks. The confidence and perceptions needed to support investment decision-making will be slow to return given the approach of the state to remedy the crisis. 3. Contributing factor in economic softening -- Uncertain energy reliability and higher costs can drive-out marginal businesses cause healthy companies to constrain expansion and lead new entrants to question whether to make new investments. As such an extended energy crisis contributes to inflation pressures and may slow economic growth. 4. Increased pressure on the Western grid -- Even as capacity increases and demand reductions work to resolve the California crisis these solutions have long-term implications for the Western Grid. These include a realistic possibility of California becoming an energy island as a result of near-term reduction in available regional resources for export to California increased emphasis on security control to protect against overall Western grid failure as sub-regions have problems RTO requirements to strengthen locally available supplies to bolster overall system reliability longer-term development of new plants using plentiful coal resources and clean coal technology will alter the pattern of imports into California and the emergence of Mexico as a major supplier to southern California and Arizona contributing to a bifurcation of the Western Grid into northern and southern markets. 5. Unbundling failures that push companies back to portfolio strategies -- For California investor-owned utilities unbundling has achieved neither the least-cost solution sought by regulators nor value maximization targeted by investors. This necessitates a reevaluation of portfolio management strategies potentially involving generation transmission power trading and marketing and retail businesses in multiple geographies serving multiple markets. 6. Ineffectiveness in changing siting and development restrictions -- California's retail price caps and multiple explanations for the crisis have left accelerated siting processes and environmental standards changes open to challenge by various interests. In addition limiting application of new siting orders only to small generators contributes to uncertainty and investor hesitancy. 7. Procurement management that alters user-utility negotiating leverage -- Competitive markets compel participants -- suppliers marketers large industrial buyers etc. -- to strategically manage procurement as a critical value-driver. Because risk is explicitly shared and always has the potential of shifting advantage to either seller or buyer the sophistication of negotiations and contracts increases as competitive markets evolve. 8. Increased emphasis on distributed generation and new technologies -- California's reliability and price challenges have triggered a re-emergence of energy crisis measures from the 1970s. End-users are investing in solutions they control and the distributed generation market is being aggressively developed among large retailers industrial users and residential customers. This makes possible the development of microgrids connecting consumers in local areas and related changes in traditional grid systems from modifications in interconnection agreements to changing definitions of reserve margins and system reliability. Industry Executives' Response Senior executives from sixteen non-California utilities with a combined market capitalization over $120 billion and $145 billion in revenues responded to an Andersen survey with their views of the implications of the California power crisis for their companies and for the industry. The survey conducted between February 19 2001 and March 2 2001 by Knowledge Systems & Research Inc. of Syracuse found that the companies are observing the California situation carefully expect a slowing -- but not a turnaround -- of deregulation and believe their internal plans and preparations are on-target for the changing environment: -- Deregulation -- Nearly all executives believe recent California events will slow the pace of deregulation over the next five years for states that have not begun or finished writing restructuring legislation. None believe that it will cause advanced states to re-regulate markets although many states will review their legislation to assess their risk of duplicating California's current situation and make any changes necessary to avoid it. -- National legislation -- Few executives suggest the situation will initiate national energy policy/legislation others believe it will be a continuing issue but because of state-to-state variances Congress will be unable to pass any comprehensive measures or force states to a restructuring timeline. Some expect additional state-level legislation. -- Company strategies -- Most do not see any changes to their business models or strategies for generation distribution or supply procurement as a response to the situation in California. However many have expanded their risk management programs reduced spot market purchases begun emphasizing long-term supply contracts planning new power generation capacity and started hedging with futures trades. Those facing price caps are rethinking their stance on them. -- Investor scrutiny -- Many executives indicate their shareholders are aware of the situation and investors -- particularly institutional investors -- are more heavily scrutinizing their actions. Many say news coverage has prompted retail commercial and industrial customer skepticism of industry restructuring. -- Transmission deregulation -- Many executives agree the California situation will increase interest in FERC's regional transmission organizations (RTO) deregulation effort. Utility Company Action Items Both to guard against a sudden California cascade and as a potentially powerful competitive thrust forward-thinking utilities should bolster their basic preparedness with a variety of tactics -- or inoculations -- specifically aimed to combat a potential California power virus according to Andersen partner Mark Moskovitz: -- Improve procurement management and risk management capabilities -- To manage exposure to volatile supply and demand shifts organizations must be sure that comprehensive and clear supply procedures controls decision points risk limits and communications are in place. -- Plan and design innovative rate and pricing structures -- Companies and regulators must focus on communicating price signals that create value for both the customer and the provider. Innovative rate and pricing structures that more closely tie the customer's price to the real cost of supply will better signal the value of the service as well as providing more accurate information upon which both end user and supplier can make decisions. -- Increase emphasis on demand side management (DSM) strategies -- In addition to new pricing strategies to help achieve and maintain supply-demand equilibrium companies must now focus on employing more extensive and innovative demand side management programs. These programs may offer significant benefits with limited risk to both the customer and energy supplier. -- Assess the supply and generation dynamics in adjacent jurisdictions -- Companies must take a broader view -- beyond typical geographic market definitions -- of the economics of generation and related business decisions in an increasingly volatile market in which supply will follow the best prices. -- Develop contingency plans for the continued deferral of new generation capacity -- In the face of potential ongoing generation capacity shortages companies and regulators must be prepared to move with a portfolio of strategies to meet demand including for example DSM flexible pricing and distributed generation. In addition they should explore efficiency-improving upgrades to existing facilities and seize any opportunity to accelerate near-term construction plans. -- Proactively address potential organizational disruption -- As regulatory and economic changes continue to churn the industry waters and companies adjust and/or restructure they must be highly cogniscent of sensitive to and directly address employees' concerns with information about the company's future and theirs'. Industry/Regulatory Lessons There are also a number of broad primary lessons the electric power industry -- nationally and internationally -- should take away from its first major domestic test case in deregulation and restructuring according to Andersen principal David O. Jermain: -- Simplify market design. -- Build a continuing role for regulators. -- Maintain communications with multiple constituent interests. -- Prepare contingency plans for extreme stress conditions. -- Couple real-time retail pricing with transparently priced wholesale competition. -- Provide special incentives for RTO investment formation and development. -- Break down regulatory and political barriers to market signals and responses. Andersen is a global leader in professional services. It provides integrated solutions that draw on diverse and deep competencies in consulting assurance tax corporate finance and in some countries legal services. Andersen employs 85000 people in 84 countries. Andersen is frequently rated among the best places to work by leading publications around the world. It is also consistently ranked first in client satisfaction in independent surveys. Andersen has enjoyed uninterrupted growth since its founding in 1913. Its 2000 revenues totaled US$8.4 billion. Learn more at www.andersen.com. Copies of the Energy Crisis in the Western United States: Lessons for Navigating Regulatory and Market Minefields report can be obtained at A PDF copy of the report can be obtained by contacting Melanie Fahey at 713/222-1600 or mfahey@sommersassoc.com CONTACT: Sommers & Associates Houston | Tom Sommers 713/222-1600 |=20 tsommers@sommersassoc.com |=20 or | Andersen Houston | Melissa Spradley 713/237-2385 |=20 --- --- Soaring Temperatures Produce Call for Conservation=20 California ISO Also Announces New Outage Notification System and On-call=20 Number FOLSOM Calif.--(BUSINESS WIRE)--April 24 2001 via NewsEdge Corporation - As the mercury climbs this week the California Independent System Operator (California ISO) is reminding consumers to curb their electricity use in order to minimize the strain on the power grid. The first warm spell of the season is expected to cause temperatures to jump 10 degrees leading to a 2000 megawatt increase in electricity consumption -- the equivalent of two large power plants. The week started out with a peak demand of 28835 megawatts but by tomorrow it is forecasted to top 30500 megawatts. This comes as hydroelectricity resources (both Northwest and California) run low more than 10000 megawatts of power plants remain off line due to planned and unplanned maintenance and some 3000 megawatts of Qualifying Facilities or alternative energy suppliers are not operating. The California ISO's renewed call for conservation precedes a forecast of 90 degree highs in the inland areas that may tempt many Californians to flip on air conditioners. For conservation tips -- such as using fans instead of air conditioners setting thermostat at 78 degrees etc. -- please see the California ISO's web site www.caiso.com. New Notification System: With a challenging summer around the corner the California ISO wants to do all it can to bring information to the public as quickly as possible. For that reason a new notification system is being brought on line. Media and the public can now access the Internet to keep current if rotating blackouts are issued. Navigation: Visit www.caiso.com Click on System Conditions for current information on rotating outages (will appear only when activated) For previous outage information (last hour etc.) click on Market Notices scroll to bottom of page and click on Notice Log The California ISO is also testing a new service to notify newsrooms immediately by email should the ISO initiate electrical emergencies (Stage One - Three) or rotating outages. If you would like to participate please email kwerst@caiso.com with a maximum of one email address per newsroom. Additionally a single on-call media pager number has been established: 916/815-0679. To make it easier on media ISO Communications will no longer be posting on-call schedules for media spokespersons on the web site. Simply call the on-call pager after hours. News releases alerting the media to electrical emergencies will continue as will news conferences held on-site in Folsom and via telephone. As a reminder if you wish to visit the ISO control rooms (in Folsom or Alhambra) always call ISO Communications first at 888/516-NEWS to make an appointment. Access to the control rooms may be limited on certain days depending on system conditions and/or level of requests from media. CONTACT: California ISO | Patrick Dorinson 888/516-NEWS | Media Hotline:= =20 888/516-NEWS What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: United India - strictly confidential and privileged Body:: Bruce this memo is dealing with the merits of litigation v arbitration to resolve DPC's DSU claim for the first set of rotor problems. Recall that we tried to negotiate a settlement with insurers for some time and then UI served DPC with a notice of arbitration because of the threat of a bad faith claim. I think I summarized it earlier for you but essentially we now have the choice of pursuing litigation in London against insurers since United India has now sued us in London Court (in addition to arbitration because they figured out a little late that under the policy only quantum may be arbitrated and they don't want to admit liability). Our option before was only to sue them in India which really isn't an option which is why we agreed to arbitration. Basically UI can't decide what it wants to do but this memo from Linklaters sets forth DPC's options which Justin Ken Blades and I discussed regarding the pros and cons of litigation v arbitration. It's a complex mess and I'll be glad to sit down and explain it to you (or not) but we are basically writing to UI's counsel to try and determine what their position is and then we'll decide whether to litigate or arbitrate. Part of this relates to the adjuster's agreement with Ken as to the quantum owed upon a determination of liability. This is all very strange but nothing regarding India or DPC surprises me anymore. We'll talk about it when you have time but I just want you to know I'm taking care of this--let me know how involved you want to be (or not...). Just FYI mb ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: organizational announcement Body:: Ken was meeting with him the day before yesterday. I'm just waiting to hear back. Sherri Sera 03/13/2001 10:07 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: organizational announcement Just saw the memo about Sanjay Diomedes and Jim. Guess David Haug is still around? SRS What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Next NERC Reliability Meeting on Legislation -- August 9th Body:: I don't know that NERC has given up on Enron. The timing of next week's meeting to resolve the legislation reflects the legislative realities that the committees of jurisdiction in Congress will take up the realibility legislation along with other electricity issues as early as the second week of September. In fact congressional staff in the Senate and House are drafting legislative language on electricity issues during the August recess. They have pressed the coalition for a final work product. I gathered that at least some of what Jeff'spresentation to the NERC board would be about concerns matters beyond the legislation as such but since they go to the NERC board's operation and independence may go to our comfort level with NERC as the standards setting organization. Given the issues and concerns that have been addressed and communicated to NERC and our preference for the PJM model (as Jeff told John Q. Anderson in the conference call) I think NERC got the information it wanted to get out of the call even though it didn't like the answers: i.e. whether Sarah and I have been faithfully representing Enron's position whether Enron supports an SRO type organization and whether there is anything they can do to get us on board. Perhaps we should have another conference call early next week so that Sarah and I have our guidance from everyone going into the August 9th meeting. For one thing we need to determine if we are in any position to provide detailed comments on the shortened NERC version at the August 9th meeting or whether we do not wish to engage them on what specific changes it would take to get us on board. My sense is that since we have to deal with the players in the room on other issues our overall position will be strengthened if we have some specific comments to make to explain our decision not to support NERC's version even the shortened one. Don't get me wrong -- we have plenty of good reasons not to I just wasn't sure how engaged we wanted to be in identifying changes that would bring us on board since I gather our opposition is more fundamental (no Western deference budget concerns independence issues etc.). From: Charles Yeung/ENRON@enronXgate on 08/03/2001 11:57 AM To: John Shelk/NA/Enron@Enron Richard Shapiro/ENRON@enronXgate James D Steffes/ENRON@enronXgate cc: Linda Robertson/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Subject: RE: Next NERC Reliability Meeting on Legislation -- August 9th John We are concerned how this meeting impacts what transpired between John Q Anderson and Jeff Skilling on the conference call on Thursday. David Cook was on the call as well and we do not understand the sudden urgency for NERC to reach closure. Has NERC given up on Enron? As we understand it John Q Anderson agreed to give Jeff an opportunity to present present before the NERC Board some ke y issues for Enron before trying to finalize any NERC legislation proposal. Does this meeting next week preclude that presentation from occurring? Or will there be willingness to alter the language significantly enough to appease the Enron concerns next week? Charles Yeung What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: The Prediction Company Body:: Greg I scheduled a meeting with Norman Packard from the Prediction Company in Houston July the 30th 9:00 a.m. Liz blocked out a few hours for the meeting. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Comments on Judge Wagners Proposed Recommendation Body:: My comments are attached. I think the pleading is well written but as you'll see from my comments I believe we should be incorporating more of the arguments from the previous pleading. Ray Alvarez 07/09/2001 07:14 PM To: James D Steffes/NA/Enron@Enron cc: Jeffrey T Hodge/Enron@EnronXGate Robert C Williams/Enron@EnronXGate Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Alan Comnes/Enron@EnronXGate Jeff Dasovich/NA/Enron@Enron Susan J Mara/NA/Enron@ENRON Robert Frank/NA/Enron@Enron Sarah Novosel/Corp/Enron@ENRON dwatkiss@bracepatt.com Subject: Comments on Judge Wagner's Proposed Recommendation As you may be aware the Chief Judge informed the parties to the settlement proceeding this afternoon that he intends to recommend to the Commission that it employ the June 19 rate methodology for the refund period from October 2 forward. Attached are draft comments that Sarah Novosel and I propose to submit to the Judge and his legal staff tomorrow. While we would like to convince the Judge that the June 19 methodology is not appropriate we also provide a fallback approach. Please review the comments (they are only 4 pages) and send your comments to us. We plan to submit the comments tomorrow. Thanks Ray and Sarah What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Firsst article attached refers to the 1946 Nebraska case I mentioned to you= =20 in DC What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Crisis Body:: Attached is the document I mentioned. You will get a separate e-mail from Karen Denne which will include the invitation and the invited for the Thursday meeting. My contact information: Steven J Kean EVP and Chief of Staff Enron Corp 713.853.1586 skean@enron.com pager: 888.906.9761 Asst Maureen McVicker 713.853.1808 I will be in Japan most of next week but my office can reach me. Thanks What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Gov Geringer meeting Body:: I'd prefer to skip. How big of a problem would that be? From: Susan M Landwehr on 05/14/2001 03:09 PM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Ginger Dernehl/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Subject: Gov Geringer meeting Steve/RIck ---as you may be aware Governor Geringer personally asked Ken Lay to come to the kick off meeting of the Wyoming Energy Task Force a group that was created by legislative mandate last month. The meeting is on May 30th in Cheyenne. Mr. Lay told the Governor that he would not be able to make it on that date but promised that a senior Enron exectutive would be there. I spoke with Governor Geringer's staff person again this past week and was hoping that Paul Kaufman could be the senior executive but no such luck (unless you give Paul a huge new title!). In talking with Maureen I understand that you have a previous conflict Steve but I am hoping that you can review your calendar to see if you could make an adjustment in order to meet the request of the Governor. Your speech would be in the morning--I've been told about 9 o clock or so---which would allow for you to leave by noonish. I What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Bill Massey Body:: Probably not. Let's communicate Breathitt's interest to Bone and stay out of it for now. Richard Shapiro 08/16/2000 08:42 AM To: Steven J Kean/HOU/EES@EES cc: Joe Hartsoe/Corp/Enron@ENRON James D Steffes/HOU/EES@EES Subject: Re: Bill Massey Is this the right time to weigh ? Steven J Kean 08/16/2000 06:56 AM To: Joe Hartsoe/Corp/Enron@ENRON cc: Richard Shapiro/HOU/EES@EES James D Steffes/HOU/EES@EES Subject: Re: Bill Massey I believe we should back Massey as well. Who do we weigh in with now? Joe Hartsoe@ENRON 08/15/2000 08:27 AM To: Steven J Kean/HOU/EES@EES Richard Shapiro/HOU/EES@EES James D Steffes/HOU/EES@EES cc: Subject: Bill Massey Steve/Rick/Jim --- Talked to John Anderson yesterday. He had just gotten off the phone with Massey. Massey believes Linda B. is spending time at the White House lobbying to be Chair. Have we decided whether to back either and if so which? I would prefer backing Massey. Thoughts? JOE 202.466.9150 ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: California Truck Wreck on 2/28 Involving Cummings and an Ex-EOTT Driver; CONFIDENTIAL AND PRIVILEGED ATTORNEY/CLIENT COMMUNICATION AND ATTORNEYS WORK PRODUCT Body:: ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: 2- SURVEY/INFORMATION EMAIL - 7/19/01 Body:: Subject: 2- SURVEY/INFORMATION EMAIL - 7/19/01 Current Notes User: To ensure that you experience a successful migration from Notes to Outlook it is necessary to gather individual user information prior to your date of migration. Please take a few minutes to completely fill out the following survey. Double Click on document to put it in Edit mode. When you finish click Close select Save Changes Only click O.K then re-open the e-mail and click on the 'Reply With History' button then hit 'Send' Your survey will automatically be sent to the Outlook 2000 Migration Mailbox. Thank you. Outlook 2000 Migration Team Full Name: Steven J. Kean Login ID: skean Extension: 3-1586 Office Location: EB 4712C What type of computer do you have? (Desktop Laptop Both) Laptop Do you have a PDA? If yes what type do you have: (None IPAQ Palm Pilot Jornada) None Do you have permission to access anyone's Email/Calendar? No If yes who? Does anyone have permission to access your Email/Calendar? If yes who? Yes - Maureen McVicker Ginger Dernehl Linda Noske Are you responsible for updating anyone else's address book? If yes who? No Is anyone else responsible for updating your address book? If yes who? Yes - Maureen McVicker Do you have access to a shared calendar? If yes which shared calendar? No Do you have any Distribution Groups that Messaging maintains for you (for mass mailings)? If yes please list here: No Please list all Notes databases applications that you currently use: Project Tracking In our efforts to plan the exact date/time of your migration we also will need to know: What are your normal work hours? From: 7:00 am To: 7:00 pm Will you be out of the office in the near future for vacation leave etc? No If so when? From (MM/DD/YY): To (MM/DD/YY): What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fw: Comments of Wolak Body:: kaminski What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Neptune -- merchant transmission Body:: Ed I am still here. Kaminski is a very popular Polish name. My next stage in life when it happens is a small cottage close to a beach not another corporate job. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Dinner w/Prof. Frank Wolak & Vince Kaminski Body:: Tel. 650.833.1000 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Lynn Church - EPSA, in your office. Body:: (per Tim Brown 202-789-7200) What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Shirley Can you please arrange a phone interview: Alex Lance Vasant and myself. Vince ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Final Colorado Springs, CO Itinerary Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: LA: Getting Mack and Kean together, as discussed Body:: I won't be going. Let's look for an alternate. I'd be happy to come to DC. Stephen D Burns@ENRON 07/31/2000 10:53 AM To: Steven J Kean/HOU/EES@EES cc: Subject: LA: Getting Mack and Kean together as discussed Mack McLarty and his people would like to get together with you in Los Angeles during the Dem convention to discuss our Southern Cone issues strategies etc. Will you be there on the Monday? Steve ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: IEP News 4/20 Body:: AP Online April 20 2001 Friday 7:57 AM Eastern Time Financial pages ????238 words Power Co. Executives Lose Bonuses LOS ANGELES Contra Costa Times April 20 2001 Friday STATE AND REGIONAL NEWS K560 ????460 words Energy officials accused of manipulating natural gas market ????defend actions By Andrew La Mar Los Angeles Times April 20 2001 Friday Home Edition Page 3 715 words ???? CALIFORNIA AND THE WEST ??A U-TURN ON CAR TAX REBATES ??LEGISLATION: ????STARTING JULY 1 FEE REDUCTION WILL BE FIGURED DIRECTLY INTO VEHICLE ????REGISTRATION BILLS NOT REFUNDED BY MAIL. CARL INGRAM TIMES STAFF WRITER ????SACRAMENTO Los Angeles Times April 20 2001 Friday Home Edition Page 3 453 words ???? CALIFORNIA AND THE WEST ??LOCKYER ASKS JUDGE TO ORDER FIRMS TO RELEASE ????RECORDS ROBERT J. LOPEZ and RICH CONNELL TIMES STAFF WRITERS Los Angeles Times April 20 2001 Friday Home Edition Page 3 1426 ????words CALIFORNIA AND THE WEST ??LEGISLATORS UNITE OVER ENERGY PRICE ISSUE ????POWER: BIPARTISAN CONGRESSIONAL DELEGATION CALLED TOGETHER BY DAVIS SAYS U. ????S. MUST STEP IN TO PROTECT STATE FROM MANIPULATION BY SUPPLIERS. MITCHELL ????LANDSBERG and MIGUEL BUSTILLO TIMES STAFF WRITERS The Orange County Register April 20 2001 Friday STATE AND REGIONAL NEWS ???? K497 846 words Federal energy commission considers price fix for state ????energy market By Dena Bunis San Jose Mercury News April 20 2001 Friday STATE AND REGIONAL NEWS ????K512 696 words In response to power woes rating agencies have California ????on credit watch By Jennifer Bjorhus San Jose Mercury News April 20 2001 Friday STATE AND REGIONAL NEWS ????K520 1069 words Issues still remain on what power consumers will ????eventually pay By John Woolfolk and Michael Bazeley The San Francisco Chronicle APRIL 20 2001 FRIDAY FINAL EDITION NEWS ????Pg. A4 765 words Edison pushes lawmakers to accept deal David Lazarus The Associated Press State & Local Wire April 20 2001 Friday BC cycle ????7:04 AM Eastern Time State and Regional 438 words Most Edison executives ????going without bonuses By GARY GENTILE AP Business Writer LOS ANGELES The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? State and Regional 901 words Top political aide discusses Bush's low-key ????style By RON FOURNIER AP White House Correspondent WASHINGTON The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? State and Regional 727 words Utility commission staff says parent ????company profiting from energy sales BOISE Idaho The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? State and Regional 820 words Legislators probe possible power natural ????gas collusion By DON THOMPSON Associated Press Writer SACRAMENTO Copyright 2001 Associated Press AP Online April 20 2001 Friday 7:57 AM Eastern Time SECTION: Financial pages LENGTH: 238 words HEADLINE: ?Power Co. Executives Lose Bonuses DATELINE: LOS ANGELES BODY: ???Senior executives at Southern California Edison and its parent company went without hundreds of thousands of dollars in bonuses in 2000 because of California's power crisis. ??Edison International's chairman and chief executive John Bryson was paid $950000 in 2000 compared with salary and bonus totaling $2.16 million in 1999. ??Stephen Frank the chairman and chief executive at Southern California Edison was paid $617000 in 2000 compared with salary and bonus totaling $1.3 million in 1999 according to the company's proxy statement filed with the Securities and Exchange Commission. ??The company also said Thursday it would not award merit increases to executives in 2001 because of the continuing crisis. ??In a similar statement released Tuesday Pacific Gas and Electric Corp. revealed it also withheld bonuses for its top two executives although they did receive raises. ??Edison and PG&E say they have lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Edison is continuing to work with state officials and its ??reditors. ?????(PROFILE ?????(CO:Southern California Edison Co. TS:SCE) ?????(CO:Pacific Gas and Electric TS:PCG IG:ELC) ?????) LOAD-DATE: April 20 2001 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service Costa Times 20 2001 Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K560 LENGTH: 460 words HEADLINE: Energy officials accused of manipulating natural gas market defend actions BYLINE: By Andres LaMar BODY: ??SACRAMENTO _ Energy officials who are accused of manipulating California's market for natural gas defended their actions on Thursday and attributed the state's skyrocketing gas prices to increased demand the weather and other factors. ??The explanation however drew skepticism from lawmakers in the wake of expert testimony alleging that one Texas firm El Paso Natural Gas Co. had engineered a classic case of monopoly power by controlling the pipeline that delivers gas to the state. ??At the outset of the Thursday's hearing Assemblyman Darrell Steinberg D-Sacramento noted the huge run-up in the cost of natural gas which went from $6.6 billion for the entire year of 1999 to $12.3 billion for sales in 2000 and to $7.9 billion for the first three months of this year. ??Steinberg zeroed in on the difference between California and other parts of the country. From March 2000 to February 2001 natural gas prices have risen 489 percent compared to a 266 percent increase in New Mexico and a 247 percent jump in Chicago. ??Steinberg asked Ralph Eads the president of an El Paso Natural Gas Co. subsidiary for an explanation. ??The 275 percent difference you say is attributable completely to constraints on the pipeline and demand? Steinberg asked. ??Yes Eads replied. Eads said the state's energy crisis which led power plants to run harder and longer dramatically increased demand for natural gas over the summer and a winter with temperatures about 15 percent cooler than the year before exacerbated the problem. ??In another twist to California's deregulation nightmare El Paso officials said they gained greater control of the pipeline after the Pacific Gas & Electric Co. relinquished the capacity four years ago. At that time PG&E's movement of the gas and the prices it could charge were regulated by the Public Utilities Commission. ??In other developments at the Capitol on Thursday lawmakers called on the federal government to re- regulate natural gas sales at the California border and U.S. Sen. Joe Lieberman D-Conn. said federal regulators should impose price caps on California's wholesale electricity market. ??The Assembly held considerable debate on the resolution asking for re-regulation with Democrats accusing President George W. Bush of doing nothing to come to the aid of California and Republicans defending the administration. ??I'm learning an interesting lesson that all the problems of the world started after Jan. 21 and the inauguration of the new president said Assemblyman Bill Leonard R-San Bernardino. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 Contra Costa Times (Walnut Creek Calif.). ??Visit the Contra Costa Times on the Web at http://www.cctimes.com/ JOURNAL-CODE: CC LOAD-DATE: April 20 2001 of 78 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 20 2001 Friday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 715 words HEADLINE: CALIFORNIA AND THE WEST A U-TURN ON CAR TAX REBATES LEGISLATION: STARTING JULY 1 FEE REDUCTION WILL BE FIGURED DIRECTLY INTO VEHICLE REGISTRATION BILLS NOT REFUNDED BY MAIL. BYLINE: CARL INGRAM TIMES STAFF WRITER DATELINE: SACRAMENTO BODY: ??Gov. Gray Davis and the Legislature spun a U-turn Thursday and scrapped a costly program that requires motorists to first pay their car tax and then get a rebate in the mail. ??Starting July 1 the state Department of Motor Vehicles will send owners of approximately 26 million vehicles registration renewal bills already reduced by the amount of the vehicle license fee rebates. ??On a unanimous roll call the Senate voted final approval and sent to Davis an urgency bill SB 52 that repealed the rebate program which the governor had previously fought for and defended. ??In addition to abolishing the rebates the legislation reduces by 67.5% the amount motorists must pay for the upcoming year the level that lawmakers and former Gov. Pete Wilson envisioned in 1998 when they began cutting the fee. It had been about 2% of a vehicle's market value. ??Davis immediately signed the repeal bill saying only that the new law will expedite relief to taxpayers and greatly reduce administrative costs. ??The governor's muted observation contrasted with his effusive support of the rebates last year when he said Californians don't appreciate the fact that they're getting a rebate unless they see it in their hands. ??At the time Davis and the Legislature had the choice of simply cutting the car tax which voters might not notice or sending checks in the mail which Davis felt would have a greater impact. ??The rebates which began Jan. 1 were scheduled to continue through 2002 when Davis intends to run for reelection. In 2003 the license fee was to have fallen permanently with no more rebates. ??The whole rebate scheme was good only through the next gubernatorial election cycle said Sen. Tom McClintock (R-Thousand Oaks) who supported reductions in the license fee but opposed the rebates. ??Until July 1 the DMV will continue to bill motorists for the full amount of their license fee which includes a 35% reduction from last year. ??Then we return to you an additional 32.5% rebate making a total reduction of 67.5% said DMV spokesman Bill Branch. Starting with license renewals on July 1 the DMV bills will include the full tax cut. ??A Senate analysis of the repeal bill noted that the current awkward system . . . effectively requires taxpayers to overpay their vehicle license fee and then await a rebate check from the state--a system that is at best difficult to explain. ??But as the California economy tightened the state's budget surplus shrank and taxpayers shelled out approximately $ 50 million a day to buy electricity the costs of the rebate program threatened to become a political embarrassment to Davis. ??Projected administrative and postage costs of the rebate program alone were estimated at $ 22 million this year and another $ 22 million or so next year. ??Last year state Sen. Joe Dunn (D-Santa Ana) and McClintock sought to eliminate the rebates and give drivers their full tax cuts when they register their vehicles. Under pressure from Davis the bill failed. ??It was killed behind the scenes at the insistence of the governor McClintock said Thursday. He didn't want it on his desk. ??This year Dunn launched a similar bill but his name was struck from it as the lead author in the Assembly and the name of Sen. Wes Chesbro (D-Arcata) was substituted. ??In a speech Thursday Sen. Ross Johnson (R-Irvine) suggested that Davis' performance on the issue in an earlier time and a more just society would have resulted in his public flogging by representatives of taxpayers. ??The repeal bill was passed 78 to 0 by the Assembly on Monday and sent to Davis by the Senate on a 34-0 vote Thursday. ??If the rebates were to be abolished the bill had to pass this week in order to take effect July 1 said Branch the DMV spokesman. This is because motorists must be advised 60 days in advance that their registration renewals are due. ??We have to reprogram all the computers. We have to print new bills and mail them by May 1 for the July 1 expiration he said. It will be a little tight but we will still make it. ??Branch said that since the Jan. 1 start of rebates checks totaling $ 454 million have been sent to 7.4 million vehicle owners at an extra administrative cost of $ 9.4 million. LOAD-DATE: April 20 2001 of 78 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 20 2001 Friday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 453 words HEADLINE: CALIFORNIA AND THE WEST LOCKYER ASKS JUDGE TO ORDER FIRMS TO RELEASE RECORDS BYLINE: ROBERT J. LOPEZ and RICH CONNELL TIMES STAFF WRITERS BODY: ??California Atty. Gen. Bill Lockyer ratcheting up his investigation of possible civil and criminal violations by the state's power suppliers is asking a San Francisco judge to order two firms to hand over confidential records. ??In a motion filed Thursday in Superior Court Lockyer said Reliant Energy and Mirant Corp. have failed to comply with subpoenas for documents that were to be produced by March 19. ??Amid soaring electricity costs and rolling blackouts the attorney general launched an investigation of possible manipulation of wholesale electricity prices that have skyrocketed to record levels and have financially crippled the state's major utilities. ??Dozens of other public and private power suppliers are complying with the subpoenas. ??But in an interview Lockyer accused Reliant and Mirant of stonewalling investigators so they can keep enjoying these exorbitant profits and prices for as long as possible. ??Ultimately the companies will have to honor the subpoenas he said. I'm going to pit bull them he said. This is one we win. ??Both companies say they have done nothing wrong and played by the rules of California's flawed electricity deregulation plan. ??A spokesman for Houston-based Reliant said Thursday the firm is seeking court action of its own to ensure that sensitive business information will not be shared with other public agencies or its competitors. ??Last week Reliant asked a Los Angeles Superior Court judge to clarify the attorney general's obligation to keep proprietary information confidential. ??We're glad to cooperate with his investigation to the extent we can said Reliant spokesman Richard Wheatley. But we have not received sufficient assurances that Lockyer would keep the data confidential. ??Lockyer called Reliant's court filing frivolous and propagandistic and insisted that adequate safeguards are in place. He reserves the right under state law to share information with other government agencies aiding in his investigation but has said he will keep sensitive business information from being made public. ??Atlanta-based Mirant demanded and received similar guarantees of confidentiality Lockyer said. Mirant did not return phones calls Thursday. ??Lockyer did not discuss details of the probe or the kinds of information he's seeking. But based on the investigation so far he said it's beginning to get interesting. ??Other records indicate that the attorney general has sought 91 categories of information about the power merchants' activities. They include the operation of power plants trading information that may have been shared by private power suppliers and bidding strategies in the California market. LOAD-DATE: April 20 2001 of 78 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 20 2001 Friday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 1426 words HEADLINE: CALIFORNIA AND THE WEST LEGISLATORS UNITE OVER ENERGY PRICE ISSUE ?POWER: BIPARTISAN CONGRESSIONAL DELEGATION CALLED TOGETHER BY DAVIS SAYS U. S. MUST STEP IN TO PROTECT STATE FROM MANIPULATION BY SUPPLIERS. BYLINE: MITCHELL LANDSBERG and MIGUEL BUSTILLO TIMES STAFF WRITERS BODY: ??This may be the surest sign yet of the depth of California's energy crisis: A bipartisan cross-section of the state's congressional delegation brought together Thursday by Gov. Gray Davis not only agreed about the severity of the problem but also about the need for swift federal intervention. ??This meeting did not have the word 'Democrat' or 'Republican' used once Rep. Darrell E. Issa (R-Vista) said of the unusual spirit of cooperation at the meeting near Los Angeles International airport. ??Members of both parties said the Federal Energy Regulatory Commission must slash wholesale electricity prices so California utilities can once again afford to buy power. Since January the state government has been buying electricity on their behalf as skyrocketing wholesale prices put Pacific Gas & Electric Co. and Southern California Edison billions of dollars into debt and many power suppliers refused to sell to them PG&E has since filed for Chapter 11 bankruptcy protection. ??Although the Bush administration has said repeatedly that it is strongly opposed to price caps and FERC has refused to grant them California Republicans at the energy meeting said they are optimistic that the administration will agree to some other form of price regulation. They brushed aside the notion that such regulations might conflict with their ideological belief in a free market. ??This is not a free-enterprise situation Rep. Duncan Hunter (R-Alpine) said after the meeting. In fact it's just the opposite. ??Specifically citing the huge disparity between natural gas prices charged to California and those charged in other Western states he said California clearly has been the victim of unreasonably high energy costs. Under federal law the FERC must regulate the prices of companies if it finds they are exerting market power to drive prices to unreasonable levels. ??Executives from two Texas energy companies meeting with legislators in Sacramento denied Thursday that they had caused natural gas prices in California to artificially skyrocket by hoarding access to a critical pipeline into the state. ??After the extraordinary meeting in Los Los Angeles Rep. Brad Sherman (D-Sherman Oaks) said the biggest disagreement between California Democrats and Republicans appeared to be their relative faith--or lack thereof--in the ability of President Bush and his administration to help California. There has been much speculation that Bush who lost California in November has no political motive to help the state. ??We Democrats said Sherman hope very much that our skepticism is proven wrong. ??Davis--who sat flanked by Democratic U.S. Sen. Dianne Feinstein and the governor's newly appointed chief energy advisor S. David Freeman--said he used the meeting mainly to discuss the importance of conservation by Californians this summer and to ask the congressional delegation to pitch in. Five Republicans and more than a dozen Democrats attended the gathering. ??Feinstein said Thursday that she has asked for a third time to meet with Bush to discuss the energy situation. Meeting with Times reporters and editors Wednesday she described a recent meeting with Vice President Dick Cheney in which she said he ignored her appeal for federal assistance. ??Feinstein has been among those critical of natural gas companies saying they appear to have constricted access to a California-bound pipeline to run up prices. ??The Brattle Group a respected consulting firm alleged Wednesday before an Assembly committee that Dynegy Inc. and El Paso Natural Gas Co. had manipulated the market by charging so much for the rights to their pipeline capacity that they had in effect withheld access to it. ??That action the experts said directly forced companies trying to deliver gas to California to look for alternatives clogging other pipelines and causing a surge in prices. ??The explanation El Paso executives said was simple: Demand for gas soared in California because generators that use gas to make electricity increased production last year in response to the energy crisis. ??We're not withholding capacity--no one is said El Paso Merchant Energy President Ralph Eads. With these prices you want to sell every molecule. ??In other developments Thursday: ??* The agreement between Davis and Edison International to return its ailing utility arm to financial health is in deep trouble and could be rejected by legislators the Standard & Poor's credit rating agency said in a note to clients citing legislative and other sources. A rejection of the deal would be a humiliating setback for the governor S&P said. ??The agreement calls for among other things the sale of Edison's transmission grid to the state for $ 2.76 billion and the sale of $ 2 billion in bonds--both designed to pay off the utility's huge electricity debt. Edison agreed to several constraints including the sale of electricity to the state at prices tied to the cost of producing power. ??Since they returned Monday from a two-week recess state legislators have been sharply critical of the Edison agreement and have indicated a desire to tinker with aspects of the deal. Some lawmakers have said publicly that a bankruptcy protection filing by Edison like that of PG&E might not be such a dire outcome. ??But a senior Edison executive said it is way too early to give up on passage of the proposal which legislators have not yet seen in official form. ??There is an education process to do here the executive said of the highly detailed 38-page document. The legislators should be asking questions. That is appropriate. ??* The Public Utilities Commission voted to investigate whether alternative energy providers violated contractual agreements by withholding supplies from PG&E and Edison which owe them hundreds of millions of dollars. ??The action Commissioner Carl W. Wood said was prompted in part by lawsuits some providers have filed seeking release from their contracts with the cash-starved utilities. The producers of solar wind and geothermal energy account for more than 25% of California's electricity supply. ??The question is whether we will be able to rely on them in the long hot days of summer Wood said. ??Jack Raudy of the Renewable Energy Creditors Committee said the PUC needs to address the $ 700 million the producers are owed. All we have gotten is rhetoric from the governor the PUC and the utilities he said. ??* An $ 850-million plan to entice Californians to conserve precious megawatts appears to be running into roadblocks compounding predictions by state officials of tighter than expected energy supplies in May and June. ??Davis signed the conservation spending package last week earmarking $ 242 million of the new funds for the Public Utilities Commission to distribute to the state's investor-owned utilities to support existing conservation programs. ??But Barbara Hale director of the PUC's Division of Strategic Planning said Thursday that since Pacific Gas & Electric Co. filed for bankruptcy protection April 6 the utility has stopped releasing conservation funds. ??Hale testifying before a state Senate committee said PG&E's decision--coupled with the threat that Southern California Edison could follow a similar route to U.S. Bankruptcy Court--has complicated her agency's efforts. ??PG&E spokeswoman Staci Homrig said her company plans to petition the Bankruptcy Court to have the conservation funds designated as a trust and separated from assets tied up in the bankruptcy proceedings. She said if the court denies the request PG&E would ask to be permitted to pay the expenses anyway. The process she added could take about a month--too long in the view of some legislators given increasingly gloomy energy forecasts for late spring and early summer. ??Deputy Director Bob Therkelsen of the California Energy Commission said his agency had been counting on a number of small power producers to bolster their output during that period. But he said some producers did not purchase the necessary equipment because PG&E and Edison have failed to pay them in full for earlier electricity deliveries. ??It's not a huge amount he said of the anticipated production shortfall but every little bit helps. ??* ??Landsberg reported from Los Angeles Bustillo from Sacramento. Times staff writers Nancy Rivera Brooks in Los Angeles Carl Ingram and Julie Tamaki in Sacramento and Tim Reiterman in San Francisco contributed to this story. LOAD-DATE: April 20 2001 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ??????????????????????????The Orange County Register 20 2001 Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K497 LENGTH: 846 words HEADLINE: Federal energy commission considers price fix for state energy market BYLINE: By Dena Bunis BODY: ??WASHINGTON _ Californians who see federal re-regulation of the state's crisis-bound energy market as an answer to the impending summer emergency better look for some other solution. ??Even the short-term price fix that the Federal Energy Regulatory Commission may consider at its Wednesday meeting might be too little too late. ??Lobbyists lawmakers and other FERC-watchers say they have seen a slight shift in recent weeks among commission staff and at least one member. There is some willingness they say to consider some price controls even though the Bush administration is adamantly opposed to such measures. ??Many are looking to see if President Bush's choices for the two vacancies on FERC will provide a margin for change. ??But the commission's basic philosophy that open unregulated markets are best is not likely to change soon members say. ??I've been championing a revamping of FERC's antiquated standards for determining market-based rates Commissioner Richard Massey said Thursday. But with no success. My agency is not on the verge of turning on a dime on this market-based pricing. ??The standards are a joke Massey added because the commission never turns down requests for such pricing authority. More than 600 power sellers have been given that authority he said. ??For a power company to be allowed to charge whatever the market will bear it must show FERC for example that it doesn't have the power to manipulate the market and drive prices up. ??Any seller that can't pass our screen needs to fire their consultants and lawyers Massey said. ??While the overall philosophy remains consistent FERC staff has proposed to the commission that a Stage 3 electricity emergency in California should trigger cost-based rates a form of price controls. Such triggers would be in place for one year under the staff proposal. ??The commission may decide Wednesday whether to accept that proposal. It has to make some decision by May 1 on how the market will be monitored from now on. ??The theory behind controlling prices in Stage 3 says a FERC staff report is that during such an emergency generators have the greatest opportunity to manipulate the market and drive prices up. ??But generators have that power during Stage 2 and Stage 1 emergencies says Les Starck Southern California Edison Co.'s manager of federal regulatory affairs. Price caps during Stage 3 might avert the rolling blackouts associated with that level of crisis but they wouldn't do anything to stop generators from jacking up prices the rest of the time he said. ??It is not clear how long it would take for such price controls to take effect should the commission go along with the staff recommendation. ??We're close because summer is approaching Commissioner Linda Breathitt said Thursday. Breathitt who had firmly opposed any form of price controls said in an interview last month that given the worsening crisis in California she was open to considering some short-term measures. ??It's important to me that we address the summer Breathitt said but said she wasn't able to predict what the commission would do Wednesday. ??Even if an order is approved Massey said there could be delays while the power sellers file their costs with regulators and disputes over those filings are handled. ??Sen. Dianne Feinstein said Thursday such a move by the commission would be better than having no controls at all. There's no question that we're going to be in a Stage 3 emergency. ??Feinstein D-Calif. and other Western lawmakers have been urging FERC to step in sooner and with price controls that extend beyond just the emergency period. ??Waiting for Stage 3 to intervene is putting the whole grid at risk said Roger Hamilton a member of Oregon's Public Utility Commission. We have a real stability problem when you cut it that close. ??Feinstein says the future could well rest with the new commissioners particularly Patrick Wood the head of the Texas PUC who many believe will replace Curt Heber as FERC chairman if he is confirmed by the Senate. ??Even if Massey and Breathitt agree on broader price controls as chairman Heber could block consideration of such a move. It's unclear what stance Wood would take as chairman. ??The thing that deeply concerns me about Pat Wood is that he's from Texas Feinstein said. What's reassuring is that it appears from my personal discussion with him is that he appears to be pragmatic. ??But once again timing could be a problem. ??Bush has said he intends to nominate Wood and Nora Brownell a member of the Pennsylvania PUC but has not formally sent their nominations to the Senate. ??The Federal Energy Regulatory Commission is of vital importance right now and to let the time go on without filling the spots makes no sense Feinstein said. Please please please President Bush process your nominees. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 The Orange County Register (Santa Ana Calif.). ??Visit the Register on the World Wide Web at http://www.ocregister.com/ JOURNAL-CODE: OC LOAD-DATE: April 20 2001 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service Jose Mercury News 20 2001 Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K512 LENGTH: 696 words HEADLINE: In response to power woes rating agencies have California on credit watch BYLINE: By Jennifer Bjorhus BODY: ??SAN JOSE Calif. _ All three of the nation's influential judges of credit risk now have California on credit watch saying they are deeply concerned about the economic impact of the state's power crisis. ??The Fitch credit rating agency made it unanimous Wednesday when it warned that the thickening electricity quagmire as well as lower than expected tax revenues in February and March could spell broader risk for the state's budget. ??The announcement is a signal that Fitch too may downgrade its ratings on California's nearly $30 billion in public debt a move which could cost taxpayers millions. ??The announcement comes as state lawmakers mull a bailout plan for Southern California Edison Pacific Gas & Electric Co. sits in bankruptcy and state officials bleed through the state's general fund as they purchase expensive electricity for consumers. Earlier this week Gov. Gray Davis announced that the average daily bill for electricity purchases has risen from $45.8 million a day in the last week of March to $73 million a day. ??Moody's Investors Service and Standard & Poor's have already issued their own credit warnings although none of the three agencies has actually downgraded the state's very good double-A credit rating. ??Bond ratings are important yardsticks that bankers and investors use to price municipal and corporate bonds. A downgrade would force California to offer bondbuyers higher interest rates going forward costing taxpayers. ??The state was last at a lower A rating back in 1994. ??Moody's changed California's Aa2 general obligation bond rating outlook from stable to negative on April 6 the day Pacific Gas & Electric Co. filed for bankruptcy. Standard & Poor's has had the state's AA rating outlook at negative since January when the state began buying electricity for the utilities. ??The deciding factor for Fitch said Fitch vice chairman Claire Cohen was the disagreement over how the money from the new electricity rate hike will be spent. ??The California Public Utilities Commission ruled in late March that money generated by higher electricity bills should go first to pay the state Department of Water Resources which has been buying electricity for the utilities. Pacific Gas & Electric Co. has argued that if the state is paid first there won't be any money left for it. ??The utility is formally challenging the PUC decision and the move threatens to hold up the estimated $12 billion to $14 billion of bonds the Department of Water Resources plans to issue to buy more electricity. ??With that being appealed you don't have a clean authorization Cohen said. It signals to me that it could delay the financing process. ??A second concern is that the state isn't collecting as much in taxes as expected Cohen said. Tax collections for both February and March were below forecast. The amount of personal income tax the state collected in those months fell short by $455 million or 14% less than expected. ??Cohen said she made her decision before hearing that the state's power costs now exceed $70 million a day. Cohen and David Hitchcock the California analyst for Standard & Poors agreed those rising costs are a definite concern. ??It doesn't take much of a change in economic growth to make some of these projected fund balances disappear and so we're very worried about what the current economic activity is particularly in Northern California with some of the problems with the high tech area Hitchcock told analysts and investors last week in a conference call. ??State treasurer Phillip Angelides was traveling Thursday and couldn't be reached for comment. Other economy-watchers expressed concern. ??Sandy Harrison assistant director of the state Dept. of Finance said the move reinforced the importance of solving the current power problems soon. ??It's important to note that the rating hasn't been lowered yet and does remain very strong he said. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 San Jose Mercury News (San Jose Calif.). ??Visit Mercury Center the World Wide Web site of the Mercury News at http://www.sjmercury.com/ JOURNAL-CODE: SJ LOAD-DATE: April 20 2001 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service Jose Mercury News 20 2001 Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K520 LENGTH: 1069 words HEADLINE: Issues still remain on what power consumers will eventually pay BYLINE: By John Woolfolk and Michael Bazeley BODY: ??SAN JOSE Calif. _ State regulators last month announced an electric rate increase that would average a whopping three cents per kilowatt hour hit bills beginning in May and punish power pigs while sparing energy misers. ??Now much of that is up in the air. ??Higher rates are surely coming _ but not before June. Exactly which consumers and businesses will pay how much is uncertain as regulators rush to forge a rate structure from a tangle of more than 20 proposals. ??Their task has been complicated immeasurably by Gov. Gray Davis' decision to weigh in with a competing rate plan and Pacific Gas & Electric's move into bankruptcy court. ??Little details are moving billions of dollars around said Nettie Hoge of consumer advocate group TURN. ??All the proposals assume a tiered structure that forces the heaviest users of energy to pay the most. But key details yet to be decided mean consumers could see their average rates go up anywhere from 7 percent to 30 percent or more. ??Among them: ??_How much of an overall increase? The Public Utilities Commission approved a 3-cent per kilowatt hour increase last month which would boost utility revenue $4.8 million. Gov. Gray Davis' hike _ left vague in Davis' April 5 television address _ averages 2.8 cents for PG&E customers but only 2.3 cents for customers of Southern California Edison. ??_What regions of the state will pay? The commission agreed to raise rates only for Pacific Gas & Electric and Southern California Edison but Davis would include the additional 1.2 million San Diego Gas & Electric customers. ??_Should heavier users of electricity subsidize those who are exempt from the new rate increase? If so those users will find themselves paying much more than any of the average increase figures being tossed about. ??_How will utilities bill customers retroactively for the increase? At the time of the PUC vote on March 27 commissioner said their increase would take effect immediately. ??Various plans are being presented this week to an administrative law judge working for the commission. The judge is expected to recommend a rate structure to the PUC on May 4. Public hearings would follow May 7-11 and the commission would vote on a plan May 14 condensing to a few weeks a process that normally lasts nearly a year. ??Each of the major proposals before the commission assumes that residential customers using less than 130 percent of their baseline would be exempt from higher rates. That's mandated under a new law that allows the state to buy power. Customers already pay higher rates for exceeding their baseline which is the average basic level of use for each region of the state. ??Each major proposal also sets new tiers with progressively higher rates for medium use at 130 to 200 percent of baseline and heavy use over 200 percent of that level. ??But that's where the similarities end. ??The first distinction among the leading plans comes in the form of an assumption: How many residential customers will avoid any increase because they don't exceed 130 percent of their baseline? Davis says more than half commissioners say a little under half and PG&E says less than a third. ??The second difference among the plans is a real difference: What happens to everyone else? ??Under the plan by utilities commission President Loretta Lynch medium PG&E users would see average bills rise 9 percent and heavy users would see bills increase 36 percent. ??Davis' plan says medium PG&E users would see average bills rise 11 percent while heavy users would pay 37 percent more. But the average total bill increase for PG&E residential customers including those who are exempt would be 20 percent under his plan and 24 percent under Lynch's according to a statement on the governor's web site. ??Business customers would see proportionately greater increases averaging 30 percent under Lynch's proposal and 26 percent under Davis'. ??The most consumer-friendly of the various proposals comes from consumer-rights group TURN. They suggest an overall average residential increase of just 7.5 percent. ??TURN's plan assumes utilities cannot charge other customers more to make up for the energy misers shielded from rate increases under state law. ??PG&E disagrees with that interpretation. The utility wants other residential users to make up for any lost revenue from exempted customers through higher rates. Under the utility's plan residential customers would see an average rate hike of nearly 30 percent. ??The proposal these folks are pushing rips the heart out of that law said Matthew Freedman staff attorney for TURN. ??Another issue affecting consumers is how the utilities can bill for electricity used in April and May before the final plan is approved. ??Utility officials have objected to making the rate structure retroactive. Instead to recoup the revenue they are proposing a flat surcharge that everyone would pay regardless of how much they use. ??Edison proposes a higher surcharge added to bills for a shorter period of time _ in this case June through August. PG&E officials are suggesting a smaller surcharge that would be spread out over 12 months. ??It'll probably be something closer to the PG&E proposal Paul Clanon the commission's director of energy issues. ??All the rate increase proposals stem from a commonly understood problem: California's current frozen rates don't generate enough money to cover the wholesale price of power. The PUC raised rates 10 percent _ or 1 cent per kilowatt hour _ in January in an attempt to help but that turned out to be far from enough. ??In March the Commission approved an additional 3-cent increase. But Davis followed quickly with an alternative proposal. The next day PG&E filed for bankruptcy raising the specter that a federal judge could order even higher rates. ??Although the PUC has sole authority to raise rates under state law Davis' proposal has complicated an already complex process. The governor appointed three of the five members of the commission and his appointees seem inclined to show him deference. But Davis has been slow in filing the details of his plan which has made it hard for the PUC to proceed. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 San Jose Mercury News (San Jose Calif.). ??Visit Mercury Center the World Wide Web site of the Mercury News at http://www.sjmercury.com/ JOURNAL-CODE: SJ LOAD-DATE: April 20 2001 of 78 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????APRIL 20 2001 FRIDAY FINAL EDITION SECTION: NEWS Pg. A4 LENGTH: 765 words HEADLINE: Edison pushes lawmakers to accept deal SOURCE: Chronicle Staff Writer BYLINE: David Lazarus BODY: Although lawmakers are skeptical of the state's multibillion-dollar deal to acquire the power lines of Southern California Edison the head of the utility's parent company warned yesterday that failure to approve the accord could lead to a long and costly bankruptcy. ???But John Bryson chief executive of Edison International told The Chronicle that he thought legislators would want to do the right thing by approving the multibillion-dollar agreement and preventing Edison from following Pacific Gas and Electric Co. into bankruptcy court. ???Bankruptcy for California's two largest utilities could have severe consequences for consumers. Financial analysts said a worsening of the state's energy mess would increase the possibility of higher electricity rates. ???Nevertheless lawmakers are unlikely to accept the Edison deal -- at least not in its present form. ???We are going to go through this thing extensively said state Senate President Pro Tem John Burton D-San Francisco. There are a lot of concerns about the valuation. ???Still he said legislative backing for the accord remains possible as long as Edison is open to amending some of the terms. ???The Edison people are smart enough to know that the Legislature is going to have its say Burton said. ???Indeed sources familiar with the matter said Edison expected a certain amount of tinkering with the deal and would not resist efforts to reach common ground with lawmakers. ???The Assembly members do not view bankruptcy as a favorable alternative said Assemblyman Herb Wesson D-Los Angeles. There will be a big effort to try and work something out. ???Edison's Bryson seems eager at this point to present himself and his company as reasonable business partners who are willing to negotiate in good faith. ???This contrasts sharply with the state's relations with PG&E which turned acrimonious after PG&E blindsided the governor with its bankruptcy filing. Each side blamed the other for the collapse of earlier negotiations. ???We made the decision at an early stage that this was a massive problem for the state and that the best course was to find a practical solution that would allow us to get on with operating our power system Bryson said. ???Bankruptcy he said is absolutely a last resort. It's a long and costly process. ???It is also the last thing Wall Street wants to see. On Wednesday rating agency Fitch Inc. joined Standard & Poor's and Moody's Investor Service in warning that California's credit rating could be lowered because of the state's energy mess. ???The state may be forced to issue junk bonds said Carol Coale an energy-industry analyst at Prudential Securities in New York. This could lead to a surcharge on electricity bills to guarantee the bonds. ???Bryson not surprisingly defended Edison's agreement with the governor as a prudent alternative to bankruptcy. ???This is a very good deal for the state he said. It is not a bailout. Edison gives up a lot to make all this possible. ???Southern California Edison will sell its power lines to the state for $2.8 billion. It also will provide low-cost power to California for 10 years and drop a federal lawsuit seeking full recovery of nearly $5 billion in past debt. ???Critics say the state is paying far too much for Edison's transmission system -- more than two times book value -- and that the power lines are of little use unless PG&E's grid also can be acquired. ???It's a multibillion-dollar ratepayer bailout of Edison said Doug Heller a spokesman for the Foundation for Taxpayer and Consumer Rights in Santa Monica. Edison gets off scot-free. ???Under the most likely scenario lawmakers will seek to reduce the amount paid for Edison's power lines and to increase the role of the California Public Utilities Commission in regulating the utility. ???They also will try to come up with a workable contingency plan for the state if PG&E remains adamant in its refusal to sell off its part of the power grid. ???The deal on the table is still salvageable said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. But Edison needs to understand that what it got from the governor is only a framework not set in stone. ???For his part Bryson signaled that plenty of room existed for give and take on the issue. ???We're just at the initial stage he said. We always have accepted the notion that Edison is a California regulated utility and is subject to the laws of the Public Utilities Commission.E-mail David Lazarus at dlazarus@sfchronicle.com. GRAPHIC: PHOTO Gov. Gray Davis (left) and John Bryson chairman of Edison International announced a transmission line deal on April 9. Bryson said Edison may go into bankruptcy if the deal isn't approved. LOAD-DATE: April 20 2001 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????April 20 2001 Friday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 438 words HEADLINE: Most Edison executives going without bonuses BYLINE: By GARY GENTILE AP Business Writer DATELINE: LOS ANGELES BODY: ??Senior executives at Edison International and its subsidiary Southern California Edison went without hundreds of thousands of dollars in bonuses in 2000 because of California's power crisis. ??Edison International's chairman and chief executive John Bryson was paid $ 950000 in 2000 compared with salary and bonus totaling $2.16 million in 1999. ??Stephen Frank the chairman and chief executive at Southern California Edison was paid $617000 in 2000 compared with salary and bonus totaling $1.3 million in 1999 according to the company's proxy statement filed with the Securities and Exchange Commission. ??The company also said Thursday it would not award merit increases to executives in 2001 because of the continuing crisis. ??In a similar proxy statement released Tuesday Pacific Gas and Electric Corp. revealed it also withheld bonuses for its top two executives although they did receive raises. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Edison is continuing to work with state officials and its creditors. ??The utility said its board of directors decided to withhold bonuses to all but two key executives because the financial effects of the energy crisis have overshadowed all other aspects of company and individual performance. ??The two executives who did get bonuses earned them for their roles in preserving the viability of the companies during the crisis and for retention purposes Edison said. ??Ted Craver senior vice president chief financial officer and treasurer at Edison International was paid $375000 in 2000 and received a $100000 bonus. His total compensation in 1999 was $652100. ??Harold Ray executive vice president at Southern California Edison received a salary of $390000 in 2000 and a bonus of $50000. His cash compensation in 1999 was $818400. ??PG&E paid Chairman Robert D. Glynn Jr. $945086 in salary and benefits during 2000 a 58 percent decrease from $2.26 million in the prior year according to the company's proxy statement. ??Glynn 57 received a 12.5 percent increase in his base salary but didn't get a bonus. ??Gordon R. Smith who runs Pacific Gas and Electric received a 14.5 percent raise in his base salary to $630000 but didn't receive a bonus. In 1999 Smith's compensation package totaled $1.1 million. LOAD-DATE: April 20 2001 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle SECTION: State and Regional LENGTH: 901 words HEADLINE: Top political aide discusses Bush's low-key style BYLINE: By RON FOURNIER AP White House Correspondent DATELINE: WASHINGTON BODY: ??When 24 members of a Navy spy plane crew returned to the United States after 11-days in Chinese custody President Bush was noticeably absent from their homecoming ceremonies. ??He also kept a low profile as the Senate shrank his tax-cut plan by $400 billion and had little to say about riots in Cincinnati this month. ??Such is the silent style of the new president says Bush's top political strategist Karl Rove. ??Every administration is marked in contrast to its predecessor. The previous administration felt compelled to dominate the evening news every day and the president said 'I'm focused on getting the job done' Rove said Wednesday in an Associated Press interview. ??Running a low-key presidency sets Bush apart from former President Clinton but the style has its critics. ??Some lawmakers including members of his own party said Bush could have saved more of his $1.6 trillion tax-cut plan if he had personally lobbied more lawmakers. ??Bush issued a statement expressing sympathy with police and protesters in Cincinnati but ran the risk of looking detached. ??And Rove acknowledged that there was some discussion in the White House about Bush attending the U.S. crew's homecoming to reap the public relations reward for freeing the crew. ??But the president vetoed the idea according to Rove who quoted Bush as saying I want it to be about them and I don't want to go through the discombobulation that it would require of them and their families for me to show up. ??It is not hard to imagine Clinton commanding center stage during city riots a budget battle or an international crisis but Rove said We intended to have a smaller profile than the previous administration. ??Bush's attitude is that he's not going to be measured by whether or not he gets on the evening news but on whether or not he gets progress Rove said during the 45-minute interview. ??He sat at a polished wood conference table in his West Wing office his hands folded over a memo he had discretely turned upside down. Newspapers and a Starbucks coffee mug littered his desktop. Framed photos and artwork were propped against a chair still awaiting hanging on his 89th day in the White House. ??A painting of a Texas landscape decorated one wall allowing Bush's political strategist of eight years to go on vacation whenever I'm on the phone. ??Rove is on the telephone a lot these days crafting strategies to pass the White House legislative agenda maintain GOP control of Congress in 2002 and position the president for a re-election bid in 2004. ??Bush narrowly won the White House without California's 54 electoral votes and Rove said the president could win re-election without the state but it's always nicer to carry the Golden State. ??He said the state's electricity shortage will not hurt Bush's chances in 2004 adding that the administration has done virtually everything Gov. Gray Davis has requested. ??He suggested that the state caused its own problems by not building enough power plants and failing to follow the lead of other states such as Bush's Texas to establish sound energy policies before a crisis struck. ??This has got a very human dimension to it Rove said. It's one thing to talk about power supplies. It's another thing when you talk about how it affects their jobs how it's affecting their livelihoods how it's affecting the safety of their communities and the health of their families. This is a tough issue and it ought to be a wake up call for the entire country. ??A White House task force headed by Vice President Dick Cheney is working on recommendations to address both short-term problems of soaring electricity and natural gas prices and longer-term energy supply problems focusing on producing more domestic oil and gas and building more electric power plants. ??Rove said the administration will soon unveil new conservation measures aimed at helping California ease its shortages. ??He said Bush and his political team are bringing House Republicans from politically competitive states to the White House where they discuss their districts' needs and often gain local media attention. ??Bush also plans to attend fund-raisers for House and Senate campaign committees helping the party gear up for 2002 midterm elections in which control of Congress is at stake. ??Rove also said: ??-Bush will not seek broad authority to negotiate trade treaties anytime soon allowing time to make the legislation more attractive to Democrats. You can only put so much into that pipe and we've stuffed it he said of Bush's crowded legislative agenda. The fast track authority is key to Bush's plans for a free trade zone stretching from Canada to Chile. That proposal is the focus of the three-day Summit of the Americas beginning Friday in Quebec City. ??-Americans will support Bush's environmental policies despite criticism of his decision to overturn some initiatives of the final days of the Clinton administration. Rove stopped short of accusing Clinton of setting Bush up for political troubles. I'm not certain I see a conspiracy there. I do think it's interesting that Clinton waited until the last moment to act. ??-Bush has not wavered since the campaign in his view that states should be able to opt out of minimum wage increases passed by Congress. We are not all one single labor market Rove said. GRAPHIC: AP Photo WX109 LOAD-DATE: April 20 2001 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle SECTION: State and Regional LENGTH: 727 words HEADLINE: Utility commission staff says parent company profiting from energy sales DATELINE: BOISE Idaho BODY: ??IDACORP made $66 million in profits in the past year by buying electricity on the spot market and reselling it for a higher price to its subsidiary Idaho Power Co. the staff for state utility regulators contends. ??The Idaho Public Utilities Commission staff said such profits should not come at the expense of Idaho Power ratepayers facing staggering electrical bills. ??In a report to commissioners posted on the agency's Internet site Wednesday the staff recommended Idaho Power's proposed increases for residential and commercial customers be cut by about half. ??Idaho Power seeks rate increases over the coming year totaling $227.4 million. The regulatory staff recommends a $108.7 million increase. For residential customers a requested 34-percent hike would be reduced to 16 percent. ??This is not a final decision said Jeff Beaman a spokesman for IDACORP and Idaho Power. In many cases the commissioners disagree with the staff. ??The report noted there was nothing illegal about the transactions between Idaho Power and its sister company Idaho Energy Systems. To change that the staff urged commissioners to create a mechanism that forces Idaho Power to buy electricity at the same price Idaho Energy Systems pays for it. ??The report said Idaho Energy Systems an unregulated subsidiary of IDACORP repeatedly purchased electricity on the wholesale market and then sold it to Idaho Power for a profit. ??Idaho Power officials contend the recommended policy change could financially cripple the company. It already spent $161 million buying power on the open market and cannot recover the money unless the coming year's rate is increased. ??The failure to recoup these funds could lead to liquidity problems Beaman said and that will hurt not only the company but our customers as well. ??But IDACORP paid all of its salaried staff - including Idaho Power employees - a 15-percent bonus at the end of the last fiscal year because the company had achieved record profits of $139.9 million 53 percent over the year before. ??Beaman said incentive payments have no impact on the rate request. ??Charging the higher rate between the two subsidiaries was the result of a commission order tying the price that Idaho Energy charges for wholesale electricity to the Mid-Columbia Index. The index has been pegged at unrealistic levels since the energy crisis erupted in California and fluctuates constantly. ??We are confident that the transactions were performed within the letter and spirit of the law and have not been at the expense of ratepayers Beaman said. ??Commission spokesman Gene Fadness said commissioners cannot comment on a case before them but their ultimate decision can be appealed to the Idaho Supreme Court. ??The Public Utilities Commission staff also recommended: ??- Deferring $66.1 million of Idaho Power's rate request without interest until answers are available about the company's electricity deals. ??- Deferring another $45.8 million of the request until next year when the commissioners would allow Idaho Power to collect 5-percent interest. That part of the hike was earmarked for wholesale power purchases this year - purchases that the staff believes will be much more expensive next year. ??- Cutting another $10.3 million from the increase request contending it was an error by Idaho Power's Risk Management Committee that the company planned on passing on to ratepayers. ??- Implementing a low-interest loan program to encourage energy conservation by Idaho Power customers. ??- A two-year phase-in of any rate increase ultimately approved that is substantially over 20 percent. ??- Changing residential rates to a three-tiered system to encourage savings. ??Homeowners would pay 5.52 cents per kilowatt-hour for the first 800 kwh used 6.12 cents per kwh for use between 800 kwh and 2000 kwh and 7.48 cents per kwh for use over 2000 kwh. The current residential rate of 5.2 cents per kwh. ??The staff report also took Idaho Power to task saying it was warned of the possibility of spiraling prices and power shortages as far back as 1995. ??But the company contends it did not want to build generating plants during the past decade because with electricity deregulation looming nobody knew what independent power facilities were being considered. LOAD-DATE: April 20 2001 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle SECTION: State and Regional LENGTH: 820 words HEADLINE: Legislators probe possible power natural gas collusion BYLINE: By DON THOMPSON Associated Press Writer DATELINE: SACRAMENTO BODY: ??Southern California Edison was charged about $750 million more this year for natural gas because of unchecked free-market forces an industry consultant testified. ??Paul Carpenter told the Assembly Electricity Oversight Subcommittee on Wednesday the price spikes came after the El Paso Natural Gas Co. contracted first with Dynegy and later with its own marketing affiliate El Paso Merchant Energy to control the pipeline capacity. ??Officials with El Paso and other natural gas suppliers are expected to testify Thursday that they did not illegally manipulate the market. ??The California Public Utilities Commission estimated a year ago that overcharges by the companies that control natural gas flow drove up prices by $ 100 million a year to California gas and electricity customers. ??But PUC attorney Harvey Morris said that was before last summer's price spikes which he blamed on natural gas suppliers using a monopoly to game the system. ??It's way worse than we could possibly have imagined Morris said after testifying before the subcommittee. It's obviously way higher than $100 million. ??Natural gas rates at the California border generally tracked national prices until November when they spiked as high as 11 times higher than the price of natural gas elsewhere in the nation Carpenter said. ??I have never seen gas prices like this anywhere in the world said Carpenter who has been studying the energy market for 20 years for Cambridge Mass.-based consultant The Brattle Group. The Brattle Group was hired by Edison to study the natural gas market. ??The committee is one of two legislative committees exploring whether illegal market manipulation in the electricity and natural gas markets has driven up California's energy costs. ??This is a market that is plagued by the exercise of market power Frank Wolak chairman of the California Independent System Operator's Market Surveillance Committee told the Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market. The ISO runs the state's power grid. ??However there is no law against me saying 'I'm not going to sell to you' Wolak said. Market manipulation only becomes illegal when there is collusion Wolak said and such evidence is hard to find. ??Electricity generators and natural gas suppliers say a severe supply and demand imbalance - not market manipulation - has led to higher prices. ??Everybody's busy doing investigations. They're not interested in solving the problem said Independent Energy Producers Executive Director Jan Smutny-Jones. ??Investigations are wasting everybody's time Smutny-Jones said adding that previous probes and lawsuits have uncovered no wrongdoing. He said the state's power problems came because state regulators denied utilities the chance to sign long-term energy contracts when they had the chance. ??People have been playing by the rules Smutny-Jones said. ??But the Senate committee's first witnesses are ISO officials who authored studies that claim the state paid more than $6 billion too much for power last year. ??Committee chair Joseph Dunn D-Garden Grove also has slated state Auditor Elaine Howell who last month blamed buyers and sellers for skyrocketing electricity costs. Dunn also has scheduled future testimony from state federal academic and private investigators studying the power market. ??He invited five major generators to attend the committee's second hearing next week. All five - Reliant Dynegy Williams Energy Duke Energy and Mirant - say they are eager to cooperate and clear their names Dunn said. ??Dunn asked the five for a total of 86 specific documents. If the companies feel they cannot provide documents because of legal or confidentiality concerns Dunn said he will subpoena them. ??Smutny-Jones said investigators appear to be growing desperate to blame the state's natural gas and electricity price hikes on illegal market manipulation instead of natural market forces. ??He cited Attorney General Bill Lockyer's announcement last week that any informant who helped prove wrongdoing would be entitled to a percentage of the state's recovery he estimated could range from $50 million to hundreds of millions of dollars. ??If the state's offering a $50 million reward they haven't found anything Smutny-Jones said. I don't think you're going to find the fact that anybody did anything criminal here. ??Assemblywoman Jenny Oropeza D-Long Beach said she believes otherwise after Wednesday's testimony: I think it is very clear there was some price manipulation going on. ??But Assemblyman John Campbell R-Irvine isn't sure there was anything illegal. ??There clearly are market forces at work that's evident Campbell said. Whether you make the jump to market manipulation ... I haven't seen conclusive evidence that leads me to make that jump. LOAD-DATE: April 20 2001 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: California Update p.2; 5/29/01 Body:: Thanks. Talked to Rob. He's going to find out timing and cost to do a bigger American Ass. of Economist number on Wolak & Co. while I work the manifesto gang. Best Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Calypso Tribal Letters Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential Draft - David Pope Body:: Tara You are right -- those changes were not included. For Vice President level employees corporate comp.does not promote guaranteed performance bonuses. The request that he be able to get out of his employment contract if he is not promoted also is not something that we can do otherwise it will undermine the enforceability of our non-competes across the board. I spoke with David Oxley on both of those points and he concurred that these changes could not be made. Michelle Tara Rozen 04/05/2000 12:23 PM To: Twanda Sweet/HOU/ECT@ECT cc: Nigel Sellens/LON/ECT@ECT Michelle Cash/HOU/ECT@ECT Subject: Re: Confidential Draft - David Pope Thanks for this Twanda I have two comments 1)I cannot find the exception clause which indicates that David Pope can resign if he doesn't make MD as described in previous email. Am I missing this or can we not put this in? 2)Danny McCarty wanted guaranteed bonus for 2000 rather than performance target bonus as per email. Is this possible? Thanks Tara What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: my work situation Body:: This is an issue we have long struggled with. We have conducted several comprehensive reviews in the past and on an ongoing basis we go through a resource allocation process which enables subjective criteria to be considered in the prioritization and resource allocation process. I think the project is a good idea. Your sources would be John Jim Steffes and Rick Shapiro (for the RCR or resource commitment process). Doug Schuler on 05/01/2001 10:59:10 AM To: skean@enron.com cc: Subject: my work situation Dear Steve Jim and Rick: I just wanted to give you a quick update on my situation at Rice and to inquire as to a future project with your group at Enron. First I apologize for my prolonged recent absences. I have had two long-standing academic projects: one was due 4/19 (it was on final review - a paper about corporate political strategy - and just was accepted for publication at our top academic journal) and another is due 5/31. The 5/31 paper was commissioned long ago but is a key paper in a June conference (topic is methods to study corporate political activities and the public affairs function). In order to get it done properly I need to forego any work at Enron until later in the month. A project of interest to me at Enron - and I hope one that you also have interest - is assessing the effectiveness of governmental affairs. John told me that he conducted such a study for the group last year. One of the methodological challenges is to calculate the benefits that government affairs brings - especially in a system where for example on the legislative side much of the work of government affairs is to block legislation at very early stages. I suspect that govt. affairs needs to justify its existence for internal budgets at Enron and thus the benefits of the function are important to quantify. I'd like to review any of the previous work and make suggestions as necessary. At some point let me know how you would like to proceed. Otherwise I hope all is well with you all. Cordially Doug Doug Schuler Rice University Jesse H. Jones Graduate School of Management P.O. Box 1892 Houston TX 77251-1892 (713) 285-5472 tel. (713) 285-5251 fax. schuler@rice.edu What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Transatlantic meetings Body:: fyi ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Ken Lay meeting with Japanese Prime Minister Body:: Rosie -- please check Ken's calendar. This would be a great one to do if we can squeeze it in. Nick -- congrats on what looks like a great new opportunity to make progress. I am in all week and would love to talk to you and Joe. If we can't otherwise make schedules work call me at home after hours Houston time (713-621-6550). Nicholas O'Day 08/27/2000 10:49 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Ken Lay meeting with Japanese Prime Minister ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Conference Call Advisory/Invitation re: CA Legislative and Regulatory Update Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Virginia Manufacturers Association Seminar -- June 19, 2001 Body:: Steve - take a look at this and contact the sponsor with a yes or no. Thanks ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Wyoming Energy Commission subject Body:: I'll be happy to accomodate. I can take you through Enron's view of how markets overall are evolving and how we approach those markets. I'd also like to spend some time reviewing interstate transmission policy and how it affects Western energy markets. Steve Reynolds on 05/23/2001 09:40:11 AM To: cc: Subject: Wyoming Energy Commission subject Steve it was great to meet you and hear your remarks yesterday. For the speaking engagement next Wednesday I would like you to focus upon the Enron strategic model of virtual integration of market forces in the evolution of energy development. Wyoming represents a huge material resource base and the commission is charged with the development and promotion of such. But the Governor's message is that we cannot see ourselves as producers and exporters in the traditional sense. We will continue to have the status of a colony if we do not recognize the new dynamics of how these market places are evolving. If you set the stage with a presentation of Enron strategy then we will discuss how a state with its agencies and auathority can play a role in this evolution. I have set your time for 45 minutes which can include a short Qand A period. But your message can be as succint as you can make it and get the point across. You may have to present the Enron case a number of different ways but the Governor will give you latitude to make the point. You will be welcome to participate in a following panel which will address role playing by the state and the commission. Plan to join us for lunch. If you need more detail let me know. Thanks! Stephen What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: A&M - Bush Library Foundation & School of Public Policy Body:: Let's talk. While there is always some value in these things it is ususally quite small and consumes more valuable resources in trying to capture the benefit than the benefit itself. From: Michael B Rosen@ECT on 07/13/2001 08:44 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: A&M - Bush Library Foundation & School of Public Policy Steve- We have been approached by the Texas A&M/George Bush Presidential Library Foundation and School of Public Policy to endow additional funds. Enron had made an original contribution to the library foundation back in 1998 totaling $250K over five years. I am working with Community Relations and A/A Recruiting to evaluate the latest request and to discuss where Enron may have interest or find leverage for our Government Affairs Recruiting or PR efforts. The Foundation is willing to work with us to establish whatever type of program(s) and/or participatory involvement we would like. We have discussed an Enron speaker series classroom lectures advisory committee seats and the likes. I have already had a chance to run this by Rick Shapiro and Rob Bradley. Although Rick was noncommittal regarding his team's time for speaking or lecturing he seemed supportive of the effort. Rob has already been participating in some speaking opportunities there and supported expanded efforts. What are your thoughts on contribution levels (another $250K was suggested by CR) and any specific program or relationship opportunities regarding the Library Center or School of Public Policy. Please grab me for quick conversation when you have time. Thanks. Mike What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Clickathome - Proposed treatment for Involuntary Terminations - Business Reorganizations Body:: No need to review with policy committee. Kalen Pieper@EES 06/14/2001 05:44 PM To: James Sandt/ENRON@enronXgate @ ENRON Steven J Kean/NA/Enron@Enron cc: Suzanne Brown/ENRON@enronXgate@ENRON Sharon Gary P Smith/ENRON@enronXgate@ENRON Marla Barnard/Enron Communications@Enron Communications@ENRON David Oxley/ENRON@enronXgate@ENRON Robert W Jones/ENRON@enronXgate@ENRON Cindy Olson/ENRON@enronXgate@ENRON Drew Mary Joyce/ENRON@enronXgate@ENRON Cynthia Sarah A Davis/ENRON@enronXgate@ENRON Marie Elizabeth Subject: RE: Clickathome - Proposed treatment for Involuntary Terminations - Business Reorganizations All Please let me know by noon tomorrow if you have any issues with this approach. If not we are going to roll out this change effective close of business tomorrow. Steve/Cindy I'd suggest that we simply make this change tomorrow. Do you feel the need to run it by any of the policy committee beforehand? Kalen From: James Sandt/ENRON@enronXgate on 06/14/2001 05:00 PM To: Suzanne Brown/ENRON@enronXgate Sharon Butcher/ENRON@enronXgate Kalen Pieper/HOU/EES@EES Gary P Smith/ENRON@enronXgate Marla Barnard/Enron Communications@Enron Communications David Oxley/ENRON@enronXgate Robert W Jones/ENRON@enronXgate Cindy Olson/ENRON@enronXgate Drew Lynch/Enron@EUEnronXGate Mary Joyce/ENRON@enronXgate Cynthia Barrow/ENRON@enronXgate cc: Sarah A Davis/ENRON@enronXgate Marie Newhouse/ENRON@enronXgate Elizabeth Boudreaux/ENRON@enronXgate Subject: RE: Clickathome - Proposed treatment for Involuntary Terminations - Business Reorganizations Suzanne: It is my understanding that everyone is signed off on the suggested revisions to the Clickathome documents relating to redeployed individuals. Tax is. In summary if a person is terminated from Enron or one of its subsidiaries as a result of a business reorganization the forfeiture penalty is waived. The amount of the waived forfeiture penalty is added to that individuals income as salary (imputed income) and is subject to Federal State and FICA taxes. V&E and I recommend that the changes are effective as of now and not retroactive back to the start of the plan. A retroactive date would weaken the plan as it stands and take out some of the teeth that we put in at its inception. Jim X 3 5673 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FREETRIAL - Enron Corporation News Alert: KEANSTEVEN_J_ENRON_COPORATIONS 1 new stories. Body:: I'm not saying we should buy this service but I do think we need some way = of=20 staying on top of TV spots mentioning Enron. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Amendment of the CPUC subpoena for production on June 4 with mont hly updates, and clarification on confidential treatment Body:: This one is due Monday! Lots of notice. Sue Mara Enron Corp. Tel: (415) 782-7802 Fax:(415) 782-7854 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: IEP News 4/30 Body:: Today's news and some from the weekend in the following order: A year later energy crisis shows no signs of cooling off By Ed Mendel San Diego Union Tribune April 30 2001 (Quotes ??? ???Smutny on behalf of IEP) The Daily News of Los Angeles April 27 2001 Friday Valley Edition NEWS ????Pg. N9 275 words PROPOSED LAW PUTS BOUNTY ON ENERGY MANIPULATORS Staff ????And Wire Services (Quotes Smutny on behalf of IEP) San Jose Mercury News April 27 2001 Friday SJ-ELECTRIC-SUIT 245 words ????Santa Clara County Calif. Joins Lawsuit against Electric Suppliers By ????John Woolfolk (Quotes Smutny on behalf of IEP) FERC Considers Imposing a Fee on Electricity Sales in California ????? ???Updated: Monday April 30 2001 12:40 AM?ET ????-- Dow Jones News Wire? ? Los Angeles Times April 30 2001 Monday Home Edition Page 3 792 words ???? CAPITOL JOURNAL ?CALIFORNIA AND THE WEST ??How Sales Tax Is Falling ????Through a Loophole GEORGE SKELTON SACRAMENTO Los Angeles Times April 30 2001 Monday Home Edition Page 3 1808 ????words CALIFORNIA AND THE WEST ??THE CALIFORNIA ENERGY CRISIS ??LIST OF ????PG&E CREDITORS SHOWS FIRM'S WIDE REACH IN BUSINESS ??BANKRUPTCY: IT ????INCLUDES SMALL AND BIG COMPANIES GOVERNMENT AGENCIES AND FORMER EMPLOYEES. ????TIM REITERMAN TIMES STAFF WRITER SAN FRANCISCO Los Angeles Times April 30 2001 Monday Home Edition Page 3 1228 ????words CALIFORNIA AND THE WEST ??THE CALIFORNIA ENERGY CRISIS ??POWER WOES ????COMPLICATE DISCUSSIONS ON BUDGET ??FUNDING: GOV. DAVIS' PLAN FOR NEXT YEAR ????FACES DEMANDS FOR BILLIONS AS A RESERVE AND TO CUSHION ELECTRICITY RATE ????HIKES. DAN MORAIN TIMES STAFF WRITER SACRAMENTO Los Angeles Times April 30 2001 Monday Home Edition Page 7 839 words ???? COMMENTARY ??WILL THE FERC SEE THE LIGHT ON THE LAW? FRANK A. WOLAK ????Frank A. Wolak an economics professor at Stanford University is chairman ????of the Market Surveillance Committee of the California Independent System ????Operator The New York Times April 30 2001 Monday Late Edition - Final Section ????A Page 1 Column 5 Business/Financial Desk 1444 words While a Utility ????May Be Failing Its Owner Is Not By By RICHARD A. OPPEL Jr. and LAURA M. ????HOLSON The San Francisco Chronicle APRIL 30 2001 MONDAY FINAL EDITION NEWS ????Pg. A3 1108 words NEWSMAKER PROFILE ???Nettie Hoge ???Taking on power ????Consumer advocate revels in uphill battle Chuck Squatriglia The Washington Post April 30 2001 Monday Final Edition A SECTION Pg. ????A03 1669 words Energy Forecast for Summer: No Blackouts but Price Spikes ????Grid Managers Promote Conservation Await New Plants William Claiborne ????Washington Post Staff Writer CHICAGO The Associated Press State & Local Wire April 30 2001 Monday BC cycle ????9:49 AM Eastern Time State and Regional 594 words Developments in ????California's energy crisis By The Associated Press AP Online April 29 2001 Sunday Domestic non-Washington general news ????item 1313 words Geothermal Plants Need More Steam JENNIFER COLEMAN ????MIDDLETOWN Calif. The Associated Press State & Local Wire April 29 2001 Sunday BC cycle ????State and Regional 413 words Guns in schools deregulation delay on ????lawmakers' agenda By BRAD CAIN Associated Press Writer SALEM Ore. Idaho Falls Post Register April 29 2001 Sunday News Pg. a1 530 words ????Plenty of blame to go around for West's power woes PAUL MENSER Los Angeles Times April 29 2001 Sunday Home Edition Page 6 1312 ????words THE STATE ??HOW KILOWATT SOCIALISM SAVED L.A. FROM THE ENERGY CRISIS ???? JEFF STANSBURY Jeff Stansbury is a PhD candidate in American history at ????UCLA. His dissertation is on the role of the labor movement in the building ????of L.A.'s infrastructure Los Angeles Times April 29 2001 Sunday Home Edition Page 4 558 words ???? CONSERVATION SANDBAGS ??THE DAVIS ADMINISTRATION NEEDS TO LAUNCH A CRASH ????EDUCATION COURSE TO CONVINCE CALIFORNIANS OF THE SERIOUSNESS OF THE ????ELECTRICITY CRISIS AND THE NEED FOR FAR-REACHING ENERGY-SAVING MEASURES. Los Angeles Times April 29 2001 Sunday Home Edition Page 27 1316 ????words BUSH: THE FIRST 100 DAYS ??BUSH IS OFF TO A ROCKY START IN HIS ????HANDLING OF ALL THINGS CALIFORNIAN ??POLITICS: BUT WHY WOO THE GOLDEN STATE ????WHEN HE CAN'T CARRY IT IN AN ELECTION 'NO MATTER HOW HARD HE TRIES' ONE ????ANALYST POINTS OUT. RICHARD SIMON TIMES STAFF WRITER WASHINGTON Los Angeles Times April 29 2001 Sunday Home Edition Page 2 1290 ????words WEEK IN REVIEW ??TOP 10 STORIES / APRIL 23-27 Lisa Girion and ????Terril Yue Jones and Sallie Hofmeister and James Bates and Peter Pae and ????Jeff Leeds and Nancy Rivera Brooks and Peter Gosselin The New York Times April 29 2001 Sunday Late Edition - Final Section ????4 Page 17 Column 1 Editorial Desk 756 words Reckonings The Real Wolf ????By PAUL KRUGMAN Sacramento Bee April 29 2001 Sunday Pg. A1 1323 words Diesel plants ????spark concern They're expected to generate big air-quality problems when ????predicted summer blackouts hit. Chris Bowman and Stuart Leavenworth Bee ????Staff Writers Sacramento Bee April 29 2001 Sunday Pg. A1 1544 words Why Edison ????PG&E split on strategy Dale Kasler Bee Staff Writer Sacramento Bee April 29 2001 Sunday Pg. A3 679 words What will be ????fallout from California's energy meltdown? Dan Walters The San Francisco Chronicle APRIL 29 2001 SUNDAY FINAL EDITION ????INSIGHT Pg. D1 1419 words The energy crisis is good for you Louis ????Freedberg Ventura County Star April 29 2001 Sunday Editorials Pg. B09 704 words ????Reality is what's needed for real policy ?GOVERNOR: Consumers deserve to get ????real facts from Davis. Dan Walters Los Angeles Times April 28 2001 Saturday Home Edition Page 19 679 ????words OFFICIALS CALL PRICE STABILITY PLAN ILLEGAL ??UTILITIES: AGENCY ????CHIEFS SAY THE FEDERAL PROPOSAL COULD ALSO CAUSE MORE BLACKOUTS THIS SUMMER. ???? NANCY VOGEL and MIGUEL BUSTILLO TIMES STAFF WRITERS SACRAMENTO Los Angeles Times April 28 2001 Saturday Home Edition Page 19 688 ????words BILL COULD FOIL DAVIS' ELECTRICITY OFFENSIVE ??POWER: CONGRESSMAN ????WANTS TO LET SMALL PRODUCERS SELL ON WHOLESALE MARKET. BACKERS SAY PLAN ????WOULD BOOST SUPPLY BUT FOES SEE IT COSTING CALIFORNIA DEARLY. JULIE TAMAKI ????and MIGUEL BUSTILLO TIMES STAFF WRITERS SACRAMENTO Los Angeles Times April 28 2001 Saturday Home Edition Page 2 137 ????words BRIEFLY / ENERGY ??PUC ORDERS UTILITIES TO POST BLACKOUT DATA Nancy ????Rivera Brooks Sacramento Bee April 28 2001 Saturday Pg. A3 1109 words Cities take ????new look at public power The state's uncertain electricity picture has local ????officials deciding it's time to revisit the idea of municipal utilities. ????Carrie Peyton Bee Staff Writer A year later energy crisis shows no signs of cooling off By Ed Mendel San Diego Union Tribune April 30 2001 SACRAMENTO -- The first anniversary of the California energy crisis is coming up next month and as the Queen of England once remarked when the royal family seemed to deregulate it's been an annus horribilis. The horrible year for California began last May when electricity prices suddenly began to soar triggering a debate about the cause of the mysterious price increase that is likely to continue for years. It started when a three-day heat wave from May 21 to May 24 set records in some areas of the state and drove up the demand for electricity as Californians sought relief with air conditioning. More record heat June 14 in the San Francisco Bay Area strained the overloaded system of Pacific Gas & Electric and resulted in rolling blackouts the planned temporary power outages that some fear may be routine this summer. The average price of electricity on the now-defunct Power Exchange soared to $120 per megawatt hour in June five times higher than the same month the previous year and remained roughly at that level until skyrocketing to $377 in December. San Diego sounded the statewide alarm last summer as San Diego Gas & Electric the first utility to be deregulated passed along much of the higher cost of electricity to its customers until legislation rolled back and capped the utility's rates in September. The executive director of a San Diego consumers group the Utility Consumers' Action Network thinks the generators and the marketers of power using sophisticated computer methods learned something as the heat wave drove up the demand for power. It was the first time the generators had an opportunity to see how high the price could go said UCAN'S Michael Shames. It was their primer. It was Gouge 101. State Sen. Steve Peace D-El Cajon who chaired a two-house committee that completed the deregulation plan in 1996 had seen routine monitoring data suggesting that the power market was being manipulated to drive up prices. Peace took the unusual step last June of personally urging the adoption of a much lower price cap by the board of the agency that makes last-minute power purchases to maintain the grid the Independent System Operator. But the motion failed by a single vote. The consumer representative who cast the decisive vote against the lower cap resigned afterward with a blast at Peace complaining of heavy-handed pressure. Peace is unapologetic. He believes that stronger action by the ISO last June would have sent a signal that might have discouraged market manipulation. It's just like the Federal Reserve mis-timing an interest-rate move Peace said. The former ISO chairman who represents generators cited an ISO report attributing the price increase last May to the heat wave power plant outages less hydroelectric power and higher prices for the natural gas used by power plants. I think all of those things showing up at the same time resulted in significantly higher prices said Jan Smutny-Jones of the Independent Energy Producers. Why power prices remained at high levels and even soared last winter instead of dropping as usual is more difficult to explain. The ISO contended last month that generators overcharged by more than $6 billion from last May through February. But federal regulators who have their critics have found only $125 million in overcharges making it an annus marvelous for generators. Ed Mendel is Capitol bureau chief for the Union-Tribune. Copyright 2001 Union-Tribune Publishing Co. The Daily News of Los Angeles April 27 2001 Friday Valley Edition SECTION: NEWS Pg. N9 LENGTH: 275 words HEADLINE: PROPOSED LAW PUTS BOUNTY ON ENERGY MANIPULATORS BYLINE: Staff And Wire Services BODY: ??California stepped up its war on the power industry Thursday as state legislators offered to pay millions of dollars to bounty hunters who provide information leading to the arrest and conviction of energy executives and others who manipulate the electricity market. ???California is being plundered by an energy cartel said Lt. Gov. Cruz Bustamente who is promoting a bill that would level criminal penalties for exploiting energy markets. ?If what they are doing isn't illegal it ought to be. ???Bustamente was one of a crowd of state leaders who went before microphones. ???On the floor of the Assembly Speaker Bob Hertzberg D-Van Nuys rallied his Democratic colleagues behind a bill to create a state power authority with equally blistering attacks on private power suppliers. ???But after Thursday's hearing before a Senate committee formed to investigate alleged price-fixing in the energy market committee chairman Joe Dunn D-Garden Grove told a reporter: I've never seen this much smoke when there wasn't a fire. ???Power generators insist they are operating fairly and say there is no evidence of them acting outside the law. ???Jan Smutny-Jones executive director of the Independent Energy Producers Association dismissed the harsh rhetoric as unproductive. Putting people in prison isn't going to encourage more generation Smutny-Jones said warning that the political posturing would make energy generators think twice about investing in California. ???Also on Thursday experts said federally ordered caps on wholesale electricity prices won't necessarily mean California will escape rolling blackouts this summer. Copyright 2001 San Jose Mercury News San Jose Mercury News April 27 2001 Friday KR-ACC-NO: SJ-ELECTRIC-SUIT LENGTH: 245 words HEADLINE: Santa Clara County Calif. Joins Lawsuit against Electric Suppliers BYLINE: By John Woolfolk BODY: ??Santa Clara County agreed Thursday to join a lawsuit against power suppliers alleging they conspired to raise prices and boost profits while subjecting consumers to higher bills and rolling blackouts. ??The county is the first to join the suit originally filed by San Francisco in January. ?The suit seeks refunds for consumers of more than $ 1 billion in alleged excess electricity profits. ??The San Francisco suit contains significant allegations of manipulation and collusion by the wholesalers resulting in the disastrous consequences we're all familiar with said lead deputy county counsel Alan Tieger. We looked at the evidence on which those allegations were grounded and found they were indeed supported by the evidence expert and otherwise. ??The suit names a dozen electricity generating and marketing companies including Duke Energy and Enron Energy Marketing. ??Similar claims have been filed by three water districts in the San Diego area and two class-action lawsuits by private attorneys on behalf of consumers are pending against power suppliers. ??The companies have vigorously denied the charges. ??I don't think there will be any evidence of illegal activity by anyone said Jan Smutny-Jones executive director of the Independent Energy Producers Association when asked about various government probes. ??----- ??To see more of the San Jose Mercury News or to subscribe to the newspaper go to http://www.sjmercury.com FERC Considers Imposing a Fee on Electricity Sales in California ???? Updated: Monday April 30 2001 12:40 AM?ET ????? ? Such a surcharge at least in the short run would fall hardest on the state of California which since January has spent more than $5 billion buying power because the utilities have been unable to meet their obligations. For now the idea is nothing more than a proposal that occupies one paragraph buried in a 39-page order issued Thursday concerning changes to California's flawed deregulated electricity market. The commission is seeking public comment on the surcharge proposal for 30 days. After that it will decide whether to implement it. The fee was proposed by Commission Chairman Curt Hebert a Mississippi Republican as a way to stabilize the market he said Friday since part of the problem in California has to do with nonpayment of bills by the utilities. But the provision also has the potential to funnel billions of dollars to energy suppliers at a time when those payments are the subject of intense negotiation. One of the utilities PG&E Corp.'s Pacific Gas & Electric Co. (PCG news msgs) filed for protection from creditors under U.S. bankruptcy law on April 6 hoping to settle its claims with power suppliers for something less than face value. Representatives of Pacific Gas & Electric and Edison International's (EIX news msgs) Southern California Edison declined to comment on the FERC proposal Friday. The surcharge idea faces stiff opposition from some state officials one of whom said it amounts to an unwarranted intrusion into state jurisdiction. Loretta Lynch president of the California Public Utilities Commission said imposition of a surcharge would put pressure on wholesale-power costs that already are too high. Bulk power cost $7 billion in California in 1999 and topped $27 billion last year as prices careened out of control. Ms. Lynch said she opposes the surcharge provision and the entire order given Thursday but that it will be up to the full commission to decide how -- or whether -- to file a challenge at FERC. A spokesman for Gov. Gray Davis said the governor would be strongly opposed to any attempt to siphon money away from the state and expects to lodge an objection. Los Angeles Times ?????????????????????April 30 2001 Monday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 792 words HEADLINE: CAPITOL JOURNAL CALIFORNIA AND THE WEST How Sales Tax Is Falling Through a Loophole BYLINE: GEORGE SKELTON DATELINE: SACRAMENTO BODY: ??Dot-coms are in distress and laying off. Silicon Valley is a home buyer's bazaar. The Nasdaq is nauseous. So is this any time to be siccing the tax collector on Internet retailers? ??You bet. Coddling these techie traders with tax favors doesn't seem to be helping them much anyway. So why not treat e-tailers like everyone else like brick-and-mortar merchants? Treat everybody evenhandedly. ??That's the view of Assemblywoman Carole Migden (D-San Francisco) assertive chair of the Assembly Appropriations Committee. For the second straight year Migden is pushing a bill she says will close a loophole that benefits some Internet retailers. She insists it's about fairly enforcing existing law not about a new Web tax as critics claim. ??Present law requires Internet e-tailers to collect the sales tax if they have a physical presence in California such as a traditional brick-and-mortar store. But some big outfits have created separate out-of-state subsidiaries to handle their Internet orders. Same goods same ads--with a large tax loophole because the subsidiary ostensibly does not have a physical presence in California. ??Never mind that an unsatisfied customer of bookseller Barnes & Noble dot-com for example can return the Internet purchase to the local Barnes & Noble store. ??Many e-tailers with dual bricks-and-clicks operations do collect the sales tax from Internet customers. Migden cites Macy's Wal-Mart REI Hewlett-Packard and Eddie Bauer. Others refuse she says: Barnes & Noble Borders Books KB Toys Gateway Computers Radio Shack. ??Her bill simply clarifies that the sales tax applies when the e-tailer is affiliated with a California business sells identical products and they market jointly. ??Right now Migden contends certain big businesses blatantly violate the tax law and put hard-working honest small business people at a disadvantage. ??* ??Gov. Gray Davis is miffed at Migden she hears. He vetoed her bill last year declaring it would send the wrong signal about California's international role as the incubator of the dot-com community. Internet marketing must be given time to mature he maintained. ??Now Migden's at it again. The governor's exercised. He thinks I'm jamming him she says. But I'm moving the bill. He can veto it if he wants. I'm putting it on his desk. ??It already has cleared the Assembly tax committee and will shoot out of her panel Wednesday headed for the Assembly floor. Last year Democrats backed the bill. Republicans opposed it siding with the Democratic governor. ??Davis fears some future opponent will claim he signed a bill to tax the Internet. Migden is frustrated by that Internet tax tag calling it a lazy misinterpretation. ??I'm not picking on e-commerce she protests. I'm picking on the multinationals who are arrogantly evading the law in complicity with the state Board of Equalization. ??That would be in particular Republican board member Dean Andal of Stockton. It's the usual liberal nut case bill Andal says. Just a bill chasing no problem. ??* ??The BOE administers the sales tax. And Andal does agree that if an Internet purchase can be returned to a store the e-tailer legally must collect the tax. We've been looking into that he says. ??The board shouldn't have to look far. Barnes & Noble tells e-customers right on its Web site that you can return purchases to ANY Barnes & Noble store for in-store credit. ??But other than that Andal contends a company has a constitutional right to create an out-of-state subsidiary to avoid taxes. ??And he notes we're talking about relative pennies: $ 17 million annually the BOE estimates compared to $ 39 billion in total California sales tax collections. That lost revenue would cover only about seven hours worth of electricity the state now is buying for utilities. ??But e-tailing is bound to grow. Tax avoidance could become significant benefiting dot-coms while discriminating against small retailers and the poor who cannot afford Internet access. ??Migden will be in a strong position to change sales tax policy if she wins her race next year for the five-member BOE. She's the early front-runner. ??Her concern--her reverence--is for the local booksellers the mom-and-pop merchants the neighbor shopkeepers who can be smothered by the big tax evaders. The little guy with the books stacked in the back she says sweeping the sidewalk putting on extra locks obeying the law and collecting taxes--trying to make a go. ??Davis wants to be seen as a futuristic New Age pol worthy of campaign donations from wealthy Web masters. But he can manage that without tromping on his Democratic roots as protector of the little guy. LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 30 2001 Monday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 1808 words HEADLINE: CALIFORNIA AND THE WEST THE CALIFORNIA ENERGY CRISIS LIST OF PG&E CREDITORS SHOWS FIRM'S WIDE REACH IN BUSINESS BANKRUPTCY: IT INCLUDES SMALL AND BIG COMPANIES GOVERNMENT AGENCIES AND FORMER EMPLOYEES. BYLINE: TIM REITERMAN TIMES STAFF WRITER DATELINE: SAN FRANCISCO BODY: ??It reads like a phone book: Able Auto Body Able Building Maintenance Able Fence Co. Able Printing Able Termite & Pest Control. . . . ??These companies are among about 50000 entries on Pacific Gas & Electric Co.'s roster of creditors recently filed in U.S. Bankruptcy Court. ??Another company A&J Electrical Cable Corp. of Hayward has supplied PG&E with utility cables since 1980. But now the unpaid bills are hitting the $ 100000 mark--and that is a big deal to a relatively small business. ??Who would ever think that PG&E would be in bankruptcy? said owner Magdalene Reilly. This is something affecting people. I've got a lot of paychecks on Friday. ??We have orders for the rest of the year from PG&E she added. It is a question: Do you decide to ship? . . . We probably will. They are a good customer. ??When PG&E filed for Chapter 11 protection from creditors April 6 businesses from California to Canada were caught by surprise. The names of the 20 biggest creditors some with billion-dollar claims were filed with the court. The utility also submitted a list of potential creditors--more than 3500 pages worth. ??The roster speaks to the remarkable economic clout and reach of a company that prospered for almost a century before plunging into the third-biggest bankruptcy case in U.S. history. It provides a glimpse into the relationships between a giant utility--the state's largest--and businesses of all sorts and sizes. And it underscores the high stakes as a bankruptcy judge reorders PG&E's financial affairs and decides in the coming months if not years who should be paid and how much. ??The case said U.S. bankruptcy trustee Linda Ekstrom Stanley has a ripple effect. . . . Creditors are affected and they can't pay their bills either. ??There are small companies and conglomerates that sold power to PG&E. ??There are financial institutions from Wall Street to San Francisco's Montgomery Street that lent money or provided services. ??There are government agencies at all levels even the California Public Utilities Commission. ??There are some retired PG&E employees and officers including at least one of the company's former chief executive officers. ??But there also are vendors that have provided goods and services to PG&E for years: tree trimming around power lines bodywork for the utility's truck fleet fencing for its vast land holdings calibration of meters fans to cool electrical transformers printing of brochures signs for office doors flight suits for aviators who patrol power lines limousine service for traveling executives. ??No dollar amounts are attached to names on the master list. But records and interviews with dozens of creditors show that the sums owed range from hundreds of millions of dollars to very little--or nothing at all. Many of the smaller creditors were unaware they were on the roster until contacted by The Times. ??PG&E used to buy pump filters from California Pump & Supply in Sacramento. ??We just closed out their account because they owed us $ 29 said office manager Lisa Giordano. It's a hassle to get anyone over there. I just wrote it off. ??The utility bought $ 38 worth of plants from Forest Nursery in Los Osos west of San Luis Obispo. It's nothing to go to court about especially since they paid it said bookkeeper Lori Parsons. ??A wine wholesaler an ice cream company and a coastal hotel are listed. So is Sing A Long Productions in Burlingame which supples disc jockeys and karaoke. ??I am sure we have done business with PG&E and other companies that have parties from time to time said owner Nick Foster. Maybe somebody forgot that we did not get paid. ??PG&E spokesman Ron Low said the list includes everyone to whom the utility wrote a check in the last two years such as homeowners who received energy conservation rebates and retirees who received checks related to benefits. ??It was an attempt to notify anybody who possibly could have a claim against the company and to cast the widest net possible he said. ??Several PG&E retirees such as Robert W. Oliver of Berkeley were baffled by their inclusion on the list. I draw a little pension said Oliver who was a personnel executive and left the company in 1980. It's a vested pension. ??Another retiree on the list is former Chief Executive Richard A. Clarke. ??He and about 10 other former high-ranking PG&E executives or their survivors have retained an attorney to help ensure that their retirement benefits are protected during the bankruptcy case. ??We don't want someone to get the idea that this is a bunch of well-heeled executives trying to get a piece of the action said the attorney John T. Hansen. Some in our group are widows of former executives who depend on the pensions they receive as survivors. ??Hansen said some retired executives have deferred-compensation packages that might be considered a general unsecured bankruptcy claim. ??One concern he said is that PG&E Chairman Robert D. Glynn Jr. wrote recently in a San Francisco Chronicle op-ed article that health care plans and other benefits for employees and most retirees will continue. ??We would want to know what 'most' is Hansen said. We want to sort it out. ??Low of PG&E said fewer than 100 retired employees most former officers have a portion of their pension that is unsecured. That means their claims will be handled in Bankruptcy Court with those of other unsecured creditors whose debts are not backed by utility assets. ??The spokesman emphasized that ex-employees could be on the list because they received a check from the company for something. ??Companies and individuals on the list PG&E said will be contacted and given an opportunity to state their claims which the utility will file with the court May 11. ??Meanwhile the effects of the bankruptcy filing continue to ripple beyond the utility. ??PG&E's action hit AA Safe & Lock Co. in Santa Cruz particularly hard. The firm replaces keys and locks for PG&E offices and trucks. ??We are a small business and it is a big account said owner Paul Bing who declined to say what the utility owes. We haven't been doing as much for them since the whole crisis started. ??A Hayward firm that conducts environmental testing when PG&E remodels or razes buildings is out money too. Ken Byk president of Forensic Analytical would not provide a figure but said: I am obviously concerned. . . . They are a good customer but any time you run into these problems it's disappointing. ??California Steam Inc. of Sacramento services PG&E pressure washers and water recyclers at its truck-cleaning facilities. I have just a couple of invoices out said service manager Bruce Amlin. The debt he said is less than $ 500. ??A similar amount is owed to California Turbo Inc. in Ontario. Sales manager Cam Young said the utility has not paid for eight fans used to cool electrical transformers. We're a small business Young said adding with a laugh: We might have to eat peanut butter and jelly for four or five months. ??Within days of the bankruptcy filing PG&E sent about 12000 creditors letters that began: Valued Goods and Services Provider: . . . Unfortunately the bankruptcy code precludes payment for goods and services received prior to the date of filing. Payments on this pre-petition debt will be settled as part of the plan of reorganization. The company assured vendors that they will be paid for any future purchases. ??Some are not only forgiving they are outspokenly loyal to PG&E. ??The relationship between the utility and AG Signs of Stockton spans two decades. When Tony Guebara was starting his company PG&E gave him business. They try to help the little guy he said. Just about everybody in town is a vendor. They have people here who paint their trucks. ??AG Signs now has five employees and supplies PG&E with door lettering for trucks name plaques for office doors and signs and flags for construction sites. ??Guebara said the utility's debt does not worry him: PG&E has treated me real well. If I lose a couple of bucks because of this adversity that is OK. . . . I don't think we've seen the last of PG&E. ??Many businesses and individuals said they had no idea why the company believes it owes them money. ??Being included on the creditors list left the Vallejo Camp Fire Girls & Boys and other charitable organizations somewhat confused. Officials of one Berkeley church could only speculate that it was listed because PG&E stock was bequeathed to the congregation decades ago. ??Twylah Lemargie manager of the Cancer Aid Thrift Shop in Grass Valley said the utility is not even a customer. PG&E did come in and replaced lots of our ceiling lights with the long tubes she said. But it was done free as an energy saver. ??A number of vendors said PG&E's account is paid up. ??The utility rented temporary housing units for workers on a hydroelectric project about two years ago but California RV Rentals in Rio Lindo is still named as a creditor. They don't owe me money said Sandra Weaver the manager. If they want to give me some it's OK. ??Many creditors are health clubs and health care providers: medical and dental offices foot and joint specialists pharmacies chiropractors. ??When informed that the Castro Valley Chamber of Commerce was on the creditors list the woman who answered the phone laughed uproariously. Then Executive Director Bonnie Dettmer came to the line. ??I'm going to guess it's membership dues she said. They are a member and they have been very supportive. I would bet they belong to every chamber of commerce. ??One creditor is the state agency that PG&E says drove the company into insolvency by not allowing full recovery of its wholesale power costs. ??They owe us $ 5.9 million . . . for environmental impact reports on PG&E projects said Paul Clanon director of the Public Utilities Commission's energy division. It's a serious amount of money but currently is not having an impact. ??Top 10 Creditors ??The creditors owed the most money by Pacific Gas & Electric Co. according to the company's Chapter 11 filing: ???Creditor owed ???Bank of New York ????????????????????????$2.20 billion ???California Power Exchange ???????????????$1.96 billion ???Bankers Trust Co. ???????????????????????$1.30 billion ???California Independent System Operator ??$1.12 billion ???Bank of America* ?????????????????????????$938 million ???US Bank million ???Calpine Gilroy Cogeneration LP ????????????$58 million ???Calpine Greenleaf Inc. ????????????????????$49 million ???Crocket Cogen million ???Calpine King City Cogen LLC ???????????????$45 million ??* Heading a group of banks ??Source: U.S. Bankruptcy Court Northern DIstrict of California GRAPHIC: GRAPHIC: Top 10 Creditors Los Angeles Times PHOTO: Magdalene Reilly owner of A&J Electrical Cable Corp. of Hayward says her company has supplied Pacific Gas & Electric with utility cables since 1980 and that their unpaid bills are now hitting the $100000 mark. ?PHOTOGRAPHER: ROBERT DURELL / Los Angeles Times PHOTO: They try to help the little guy says Tony Guebara owner of AG Signs in Stockton of PG&E. He has been doing business with utility for two decades. ?PHOTOGRAPHER: ROBERT DURELL / Los Angeles Times LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 30 2001 Monday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 1228 words HEADLINE: CALIFORNIA AND THE WEST THE CALIFORNIA ENERGY CRISIS POWER WOES COMPLICATE DISCUSSIONS ON BUDGET FUNDING: GOV. DAVIS' PLAN FOR NEXT YEAR FACES DEMANDS FOR BILLIONS AS A RESERVE AND TO CUSHION ELECTRICITY RATE HIKES. BYLINE: DAN MORAIN TIMES STAFF WRITER DATELINE: SACRAMENTO BODY: ??Jockeying over the state's next spending plan a tradition that usually takes place in the summer already is turning intense as the energy crisis casts a pall over what otherwise might have been relatively painless budget squabbles. ??A key state senator worried about the slowing economy is looking for places to pare as much as $ 4 billion from Gov. Gray Davis' proposed $ 104.7-billion budget. And Republicans are beginning to demand that the state spend billions in general tax money to cushion electricity rate hikes of up to 40% being imposed on consumers and businesses. ??Davis won't sign the budget for the 2001-02 fiscal year into law until late June at the earliest. But with California mired in the energy crisis and the economy slowing the new budget is shaping up to be especially vexing. ??California's largest utility and a major private employer Pacific Gas & Electric is in bankruptcy. The state has spent $ 5.2 billion in general tax money to buy electricity with no end in sight. Even before summer temperatures hit Sacramento shelled out $ 90 million to buy electricity in a single day last week. ??And the Wall Street rating firm Standard & Poor's unsure that the state will be reimbursed for the power purchases lowered California's credit rating two notches for the first time since the recession of the 1990s. ??Brightening an otherwise cloudy situation income tax payments are meeting or exceeding predictions. More than $ 8 billion in checks from April income tax returns have flooded into the Franchise Tax Board said Department of Finance economist Ted Gibson. On one day last week the state's haul was $ 3.6 billion a record. ??Receipts are very much on track I'm relieved to tell you Gibson said. ??But even as budget writers were exhaling the payments merely offered proof that the economy was strong last year back when then-President Bill Clinton was heralding the longest period of economic growth in U.S. history and Californians' lexicon did not include the term rolling blackout. ??State income and sales tax receipts softened in the first few months of 2001 an indication that people will be earning less this year--and paying less in taxes next year. ??Seeing trouble ahead Senate Budget Committee Chairman Steve Peace (D-El Cajon) wants to boost the state's emergency reserve which was $ 1.9 billion in January. To do that Peace last week called on budget committee members to come up with a list of cuts totaling $ 2 billion to $ 4 billion. ??Without a larger reserve heading into 2002 Peace said the slowing economy could force the state to make deep cuts or raise taxes next year at a time when most legislators and Davis will be running for reelection. ??The thing to be worried about is not the current year but the trend line Peace said. ??He adds a caveat for the spending plan that by law must be in place by July 1: There will be cuts if legislators fail to approve legislation that state Treasurer Phil Angelides says he needs to obtain short-term loans and market long-term bonds to finance electricity purchases. ??Davis and Angelides are preparing the largest bond sale--a way that government borrows money--in U.S. history as much as $ 12.4 billion. The state would use the proceeds to ease the shock to utility customers of record high electricity prices this year. The bond debt would be paid off over a period of perhaps 15 years. ??Given the size and complexity of the bond issue many legislators say Angelides may not be able to sell it for months. ??Davis however has an immediate need for money. The governor must release a revised state budget within weeks. So he is pushing for legislators to approve legislation that would allow Angelides to obtain a short-term loan of as much as $ 6 billion. ??At least some of the proceeds of the long-term bonds would be used to pay off the short-term loan--sort of like using one credit card to pay the balance on a second piece of plastic. ??Republican legislators are balking at the idea. ??Back in December before the state entered the power buying business GOP legislators had called for $ 3.2 billion in tax cuts. With the energy crisis complicating the financial situation some Republicans are contending that Davis should use as much as $ 5 billion from the budget surplus to soften the impact of electricity rate hikes. ??That will be a de facto tax cut said Senate Republican leader Jim Brulte of Rancho Cucamonga. Our Democratic friends want to do the bridge financing so they can increase the size of government. ??Republicans are in the minority. But they have a significant voice because state law requires that both houses of the Legislature approve spending decisions by a two-thirds vote. ??The state Constitution says the budget must be in place by the July 1 start of the new fiscal year. Davis signed his first two budgets on time. Given this year's uncertainties however some legislators are thinking twice about making July vacation plans. ??The sudden turnaround may come as a shock to many legislators and lobbyists who seek slices of the state budget pie. ??In recent years legislators have grown used to the multibillion-dollar windfalls of tax payments which allowed them to deliver new swimming pools school programs museums parks social and health care spending and tax cuts to their constituents. Indeed the budget in Davis' first two years grew 37% even as the Democratic governor and legislators cut taxes by $ 3.9 billion. ??In a Legislature populated by term-limited newcomers only a handful of current legislators were in the Capitol in the early 1990s when the worst recession to hit California since the Great Depression caused the state budget to actually shrink. Then-Gov. Pete Wilson and the Legislature reacted to a $ 14-billion budget gap by raising taxes by more than $ 5 billion and slashing spending. ??It is not going to be the pie-in-the-sky budget some of us thought it would be last year and even as late as January said Sen. Jack O'Connell (D-San Luis Obispo). ??Veterans of the annual summer rite say there is no template for the coming budget fights. Jean Ross of the California Budget Project a private budget watchdog and advocacy group said Davis and legislators not only must pay attention to the economy. ??They also must take into account many unknowns: Will the judge overseeing PG&E's bankruptcy proceeding seek to raise rates further? Will federal energy regulators be able to effectively limit wholesale electricity costs? What will the economic impact be of summer blackouts? ??It's a lot more complex and unpredictable than other years Ross said. ??Legislators say they are lowering their sights. But letters from state senators requesting money for their favored projects fill five large red binders. You wouldn't know there is a money shortage based on requests in appropriations said Assembly Appropriations Committee Chairwoman Carole Migden (D-San Francisco) preparing for what she calls her hatchet role of blocking bills that require spending. ??For his part Davis has not decided to significantly cut back on his proposals ranging from a sales tax holiday timed for back-to-school shopping to plans to clean sewage from beaches. He won't reveal those decisions until he releases his revised spending plan. LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 30 2001 Monday Home Edition SECTION: Metro Part B Page 7 Op Ed Desk LENGTH: 839 words HEADLINE: COMMENTARY WILL THE FERC SEE THE LIGHT ON THE LAW? BYLINE: FRANK A. WOLAK Frank A. Wolak an economics professor at Stanford University is chairman of the Market Surveillance Committee of the California Independent System Operator BODY: ??Out-of-state firms selling into the California wholesale electricity market at exorbitant prices have been blamed for the current electricity crisis. They are claim many observers exercising their market power to raise wholesale electricity prices. ??Although it is not illegal under California or U.S. antitrust law for a firm to exercise its market power it is illegal to do so under the Federal Power Act. The Federal Energy Regulatory Commission or FERC which regulates the California wholesale electricity market is the entity charged with enforcing this law. Its refusal to take sufficient actions that would result in just and reasonable wholesale electricity rates is the fundamental cause of California's current energy crisis. It is highly unlikely that anything it has done in the last week has changed things at all. ??In 1935 Congress passed the Federal Power Act and required the Federal Power Commission (the predecessor to FERC) to set just and reasonable wholesale electricity prices. Just and reasonable prices are those that recover production costs including a fair rate of return on the capital invested by the firm. Moreover if the FERC finds that wholesale electricity prices are unjust and unreasonable the Federal Power Act gives it wide-ranging discretion to take actions that result in just and reasonable prices. The FERC can also order refunds for any payments by consumers in excess of just and reasonable prices. ??Almost 10 years ago the FERC began to allow generators to receive market prices instead of prices set through a cost-of-service regulatory process. However there is no guarantee that market prices meet the just and reasonable standard required by the Federal Power Act. Markets often set prices substantially in excess of the production costs for significant periods of time. This occurs because one or more firms operating in the market have what economists call market power--the ability of a firm to raise market prices and profit from it. ??However if no firm possesses market power the market price should be very close to a price that only recovers production costs. In such a circumstance the price set by the market satisfies the just and reasonable standard of the Federal Power Act. ??Before it allows any market participant to receive a market price rather than a cost-based price set through a regulatory process the FERC requires each participant to demonstrate that it does not have market power. In other words each market participant must submit sworn testimony to the FERC demonstrating it does not have the ability to raise market prices and profit from this behavior. ??Each of the out-of-state generators made these filings before they began selling into the California market which started in April 1998. Each firm had its authority to receive market prices approved by the FERC for a three-year period that ends before this summer for several of the firms. It is virtually impossible to determine on a prospective basis whether a firm possesses market power. Moreover the methodology used by the FERC to make this determination uses analytical techniques that have long been acknowledged by the economics profession as grossly inadequate. The events of the past 10 months have demonstrated that contrary to their filings stating otherwise all of the out-of-state generators possess significant market power. ??A number of independent studies have shown that the market power exercised by these firms has resulted in unjust and unreasonable rates from May 2000 until now. Moreover in its Dec. 15 2000 report on the California electricity market the FERC concluded that wholesale electricity prices during the summer and autumn of 2000 were unjust and unreasonable and reflected the exercise of significant market power. ??Despite its own conclusion the FERC thus far has refused to set just and reasonable prices for wholesale electricity in California. Instead the FERC implemented market rule changes that have enhanced the ability of these firms to set excessive wholesale electricity prices. In addition it has refused to order refunds for any overpayment during the summer and autumn of 2000 for the prices that it deemed unjust and unreasonable. ??Fortunately for California consumers the California Public Utilities Commission and Gov. Gray Davis refused to be accomplices in the FERC's decision not to enforce the Federal Power Act. They refused to pass on to California consumers prices that the FERC itself had determined were unjust and unreasonable. ??Because these out-of-state firms must apply for renewal of their market-based pricing authority before this summer the FERC has one more opportunity to set just and reasonable prices for wholesale electricity in California. It has before it several proposals that would enforce all provisions of the Federal Power Act. The health of the California and national economies would be severely undermined if the FERC continues to ignore its legal obligations. LOAD-DATE: April 30 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 The New York Times Company New York Times ?????????????????April 30 2001 Monday Late Edition - Final SECTION: Section A Page 1 Column 5 Business/Financial Desk LENGTH: 1444 words HEADLINE: While a Utility May Be Failing Its Owner Is Not BYLINE: ?By By RICHARD A. OPPEL Jr. and LAURA M. HOLSON BODY: ??Pacific Gas and Electric the giant California utility may have just made one of the largest bankruptcy filings in history but it has been a banner year for the rest of its parent company the PG& E Corporation. ??In Bethesda Md. far from the energy crisis in California another PG& E subsidiary National Energy Group earned $162 million last year and ranked as the nation's third-largest power trader. Compensation for the unit's executives soared. Many investors now believe that the subsidiary just a decade in the making is by itself worth more than its 96-year-old utility sibling. ???How did National Energy get so big so fast? By using cash partly generated by its sister utility to buy unregulated power plants in the Northeast expand trading-floor operations and sell power across the country. The exact numbers are in dispute but much of Nationals Energy's profits last year came from California. ??Most other large utilities have done the same thing over the past decade building national or even global power companies from roots in local monopolies. But nowhere is the success of these unregulated businesses more of an issue than in California where PG& E's investments may be challenged in bankruptcy court. ??Still such transfers of assets were fundamental to deregulation plans in two dozen states and they were encouraged by federal rules designed to build a new wholesale marketplace in electricity. ??And today the offspring of the nation's utilities dominate that market after industry leader Enron. ?Eight of the nation's 10 largest power marketers are affiliates or spinoffs of regulated utilities controlling about 42 percent of power trading. ??It is largely these unregulated power producers and traders whose sales of power in California have prompted accusations by state leaders of price gouging and demands for the price caps that federal regulators took their first halting steps toward embracing last week. ??The profitability of the utilities' unregulated operations is becoming clear as companies report earnings for the first three months of the year. ??For example Reliant Energy reported that operating income at its unregulated wholesale energy business soared to $216 million in the first quarter or 16 percent more than at its regulated utility which serves Houston. This week Reliant expects to spin off its unregulated businesses through an initial public stock offering that would put a market value on the new company of as much as $8.8 billion -- more than the rest of Reliant. ??A number of other major utility companies have spinoffs or trading and generation units that now earn nearly as much as or more than their core utility operations. These include Duke Energy in Charlotte N.C. Sempra Energy of San Diego the Southern Company in Atlanta the Constellation Energy Group in Baltimore and Utilicorp United in Kansas City Mo. ??In some places the growth of the unregulated businesses continues to raise questions of fairness -- particularly where utilities have been permitted to transfer plants to the new units at deep discounts to their market value. Critics say that ratepayers whose bills paid for the plants' construction should benefit more when the plants are sold. ??In Florida a commission on energy deregulation formed by Gov. Jeb Bush has proposed permitting such transfers on the grounds that they are needed to create a new wholesale marketplace. Opponents including the Florida Municipal Electric Association which represents utilities owned by local governments say the plan would produce a $9 billion windfall that should go to ratepayers. ??In California some creditors of Pacific Gas and Electric have signaled that they will want the bankruptcy court in San Francisco to review parent PG& E's efforts to keep its unregulated businesses out of creditors' reach. ??And the California Public Utilities Commission is investigating whether PG& E and Edison International whose Southern California Edison utility unit is also near insolvency have improperly transferred cash to their parents and to unregulated sister companies. ??A recent audit ordered by the commission showed that Pacific Gas and Electric transferred $4.1 billion to PG& E from 1997 to 1999. Most of that went to dividends and stock repurchases but $838 million was invested in other subsidiaries primarily its National Energy Group unit. Southern California Edison transferred $4.8 billion to its parent company between 1996 and November 2000 a separate audit showed Edison International invested $2.5 billion in its unregulated Mission Group subsidiaries during the same period. ??Executives of the companies say the transfers were proper. Audits have shown that we followed the rules and didn't do anything wrong said PG& E's chief executive Robert Glynn. We did not ask consumers in California to support any of the losses that occurred in those businesses when we started them up he said. Now forcing the unregulated units to support their ailing sister utility he said would be no different than calling up shareholders and saying 'The California electric bills are pretty high send some money in so we can give it back to them.' ??Loretta Lynch the president of the utilities commission took a different view. Should we look backward she asked and say 'Hey wait a minute -- that corporate structure profited by all of our power payments to them in the past and they should participate in helping us through to get to a solution in the future?' ??The cornerstone deal of PG& E's unregulated energy business was struck four years ago when it acquired the hydroelectric and fossil-fueled generation plants of New England Electric System for $1.6 billion. PG& E is now one of the largest generators in the Northeast operating plants that can light up to five million average-sized homes. ??While California officials say Pacific Gas and Electric's woes have been caused at least in part by market manipulation by out-of-state generators the Justice Department has been investigating possible market abuses involving PG& E and two other companies in New England. Mr. Glynn said that PG& E had done nothing wrong and that the company has responded to Justice Department requests for information. ??Overall PG& E's National Energy Group has 30 power plants in 10 states and others under development or construction that include one in Athens N.Y. that is expected to begin supplying electricity to New York City in 2003. It also operates an energy trading operation in Bethesda and controls a natural gas pipeline into Northern California. ??To Wall Street the utility companies' investments in unregulated businesses were a necessary survival tactic as investors demanded faster-growing profits. ??The stock market was going like gangbusters and the utilities' returns of 11 percent weren't cutting it said Richard Cortright a utility analyst at Standard and Poor's the bond rating agency. ??Moreover as deregulation loomed industry executives saw no choice but to make new investments. It looked like the utility opportunity was going to start shrinking Mr. Glynn said. ??Consumer groups question whether utilities would have invested more in improving basic service if they had not had the option of putting money elsewhere. ??Mike Florio a lawyer with The Utility Reform Network a consumer group in San Francisco cited findings last year by state regulators that from 1987 to 1995 Pacific Gas & Electric spent nearly $550 million less on maintaining electric and gas facilities than had been factored into its rates. Separately in 1999 the utility agreed to pay about $29 million to settle charges that consumers were endangered because it failed to trim trees near high-voltage power lines. ??Several hundred million dollars didn't get spent for maintenance and that ultimately falls to the bottom line as profit Mr. Florio said. ??Mr. Glynn said the utility had always spent appropriate sums on maintenance coming within one-half of one percent of the amount built into rates over a 20-year period. ??In the big picture he said it was hard to see how PG& E had been a winner in deregulation even before its utility's humiliating bankruptcy. If you look at what happened the net of it was a loss Mr. Glynn said because the value leaked out on the regulated utility side faster than we were able to build it on the nonregulated side. About This Report ??This article is part of a joint reporting effort with the PBS series Frontline which will broadcast a documentary about California's energy crisis on June 5. ??http://www.nytimes.com GRAPHIC: Charts: The Biggest Power Marketers Most of the biggest unregulated power marketers and traders are owned by the the country's biggest electric utilities or have been spun off by them. Here are the top 10 based on 2000 sales. Companies owned or spun off from utilities: Enron Power and affliliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 590.2 MARKET SHARE: 13.03% CHANGE FROM 1999: + 97% Companies owned or spun off from utilities: American Electric Power Service MEGAWATTS SOLD IN 2000 (IN MILLIONS): 401.3 MARKET SHARE: 8.86 CHANGE FROM 1999: +84 Companies owned or spun off from utilities: PG&E Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 282.6 MARKET SHARE: 6.24 CHANGE FROM 1999: +62 Companies owned or spun off from utilities: Duke Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 276.2 MARKET SHARE: 6.10 CHANGE FROM 1999: +226 Companies owned or spun off from utilities: Reliant Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 204.3 MARKET SHARE: 4.51 CHANGE FROM 1999: +166 Companies owned or spun off from utilities: Mirant Americas Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 202.6 MARKET SHARE: 4.47 CHANGE FROM 1999: +23 Companies owned or spun off from utilities: Aquila Energy Marketing MEGAWATTS SOLD IN 2000 (IN MILLIONS): 186.7 MARKET SHARE: 4.12 CHANGE FROM 1999: +4 Companies owned or spun off from utilities: Cinergy operating companies MEGAWATTS SOLD IN 2000 (IN MILLIONS): 166.4 MARKET SHARE: 3.67 CHANGE FROM 1999: +246 Companies owned or spun off from utilities: Constellation Power Source MEGAWATTS SOLD IN 2000 (IN MILLIONS): 162.3 MARKET SHARE: 3.58 CHANGE FROM 1999: +222 Companies owned or spun off from utilities: Williams Energy and affiliates MEGAWATTS SOLD IN 2000 (IN MILLIONS): 138.4 MARKET SHARE: 3.05 CHANGE FROM 1999: +127 (Source: Platt Power Markets Week)(pg. A17) Outdoing Their Parents Taking advantage of deregulation many of the country's biggest power utilities have set up unregulated subsidiaries to trade and produce power. These subsidiaries have become extremely profitable often outperforming their regulated corporate siblings. UTILITY: Duke Energy OPERATING INCOME (MILLIONS) 1Q '00: +$465 1Q '01: +460 UNREGULATED BUSINESS: North American Wholesale Energy OPERATING INCOME (MILLIONS) 1Q '00: +82 1Q '01: +348 RELATIONSHIP OF UNREGULATED BUSINESS TO UTILITY North American Wholesale Energy is a subsidiary of Duke Energy. UTILITY: Reliant Energy OPERATING INCOME (MILLIONS) 1Q '00: +$202 1Q '01: +186 UNREGULATED BUSINESS: Wholesale Energy OPERATING INCOME (MILLIONS) 1Q '00: -22 1Q '01: +216 RELATIONSHIP OF UNREGULATED BUSINESS TO UTILITY Reliant Energy plans to sell 18 percent of Reliant Resources -- mostly Wholesale Energy -- this week. UTILITY: Southern OPERATING INCOME (MILLIONS) 1Q '00: +$439 1Q '01: +483 UNREGULATED BUSINESS: Mirant OPERATING INCOME (MILLIONS) 1Q '00: +169 1Q '01: +279 RELATIONSHIP OF UNREGULATED BUSINESS TO UTILITY Southern completed the spinoff of Mirant on April 2. (Source: S.E.C. filings)(pg. A17) LOAD-DATE: April 30 2001 of 103 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????APRIL 30 2001 MONDAY FINAL EDITION SECTION: NEWS Pg. A3 LENGTH: 1108 words HEADLINE: NEWSMAKER PROFILE Nettie Hoge Taking on power Consumer advocate revels in uphill battle SOURCE: Chronicle Staff Writer BYLINE: Chuck Squatriglia BODY: Given a choice Nettie Hoge would rather be out in her garden right about now digging in the dirt. ???Instead the head of The Utility Reform Network is digging into California's energy mess making sure the average Joe doesn't take it in the kisser as lawmakers regulators and utility brass hats try to keep the lights on and utilities afloat. ???It's grueling work full of long hours that leave precious little time for the gardening Hoge so adores. Not that she's complaining. Hoge 50 honestly loves her job and insists she wouldn't do anything else. ???I've got a mutant gene she said with a laugh as she relaxed for just a moment in a spartan office littered with messy piles of paperwork. I've always wanted to do this. ???TURN has been keeping tabs on companies like Pacific Gas and Electric Co. and Pacific Bell for more than 25 years. Hoge and her crew lobby the Public Utilities Commission counsel lawmakers analyze reports and file the occasional lawsuit. They are in short professional gadflies who represent the public in a system that some say favors big business. ???The biggest protector of the consumer by far has been TURN said Bob Gnaizda public policy director for the Greenlining Institute in San Francisco. (Hoge) has made TURN into the leading consumer utility advocate in the nation. ???It's not glamorous work nor is it particularly lucrative. Hoge a lawyer by training took a pay cut when she accepted the $75000-a-year job in 1995. And truth be told most folks have no idea Hoge is in their corner. ???There are other rewards she said. You don't get the adoration of Joe Citizen standing up and yelling 'Yay TURN!' But there's an excitement about being involved in the discussions where the big decisions are made. ???The youngest of four children Hoge bounced around the middle of the country as she grew up following her career Army officer father from Kansas to Oklahoma to Texas. ???All the places where you can shoot big guns she joked. ???Hoge graduated from high school in Pullman Wash. After a stint at the University of Southern California she graduated Phi Beta Kappa from Washington State University and earned a law degree from the University of San Francisco. ???Hoge's entire career has been spent protecting the underdog. During a two-year stint as a law school graduate at Brobeck Phleger & Harrison in San Francisco I got into trouble for doing too much pro bono work Hoge recalled. The partners would come around each month to check our billable hours. Mine were always zero. ???Since taking the helm almost six years ago Hoge has led TURN to some impressive consumer victories. They include persuading the Public Utilities Commission to create a $352 million fund to underwrite rural telephone service and bringing an end to ratepayer subsidies of PG&E's Diablo Canyon nuclear power plant in 2002. ???Hoge a stickler for detail has a reputation for giving exhaustive answers to even mundane questions. ???Everybody agrees she knows what she's talking about said Harvey Rosenfield president of the Foundation for Taxpayer and Consumer Rights. In many respects TURN is the intellectual force in this debate. Those of us who are deeply involved in this issue rely upon Nettie to lay out the facts for us. ???Hoge is surprised people think her wonkish but admits she is circumspect. ???My big fear is being marginalized and having people think we (at TURN) don't know what we're talking about she said. Maybe I overcompensate. ???Few doubt Hoge's smarts but she has plenty of critics among the utilities lawmakers and lobbyists she has crossed swords with over the years. However none of them will say anything publicly. ???We have no comment on her said Shawn Cooper a spokesman for Pacific Gas and Electric Corp. the parent company of the foundering utility. ???It was the same story with Southern California Edison and many of the legislators who have criticized Hoge and TURN in recent years. ???Hoge isn't surprised her adversaries are keeping mum. ???There's nothing for them to gain by saying anything negative about us because the public is on our side she said. ???Still TURN has drawn criticism from Carl Wood generally considered the most ardent consumer advocate on the PUC. ???Frankly I would have expected myself to be on the same page with (TURN) more than I actually am Wood said. I'm not sure they wholeheartedly believe in regulation and I think it comes from a distrust of regulators. But maybe I'm taking it personally. ???Wood chastised TURN for supporting utility divestiture of generating plants as California's deregulation effort got under way. And he said Hoge places too much emphasis on the utilities' role in the energy mess instead of focusing on the profiteering of power generators. ???The utilities have some culpability but they are not the main driver behind the crisis Wood said. TURN's interventions do not reflect that reality. ???Still he gave TURN high marks and credited Hoge with making it a far more effective advocate. ???Hoge admits she has had her hands full with the energy crisis saying she and her staff are trying to keep our health and sanity. ???Asked if she would have joined TURN if she had known how crazy California's energy market would become and how hard she would have to work Hoge was characteristically wary. ???I don't think anyone would want to sign up for this she said after a moment's pause. On the one hand it's very serious very rewarding work. But on the other hand sometimes you're just beating your head against the wall. ???Still Hoge doesn't plan to give up the fight anytime soon. ???But at some point I'd like to retreat and spend some time contemplating the forest for the trees. ???Or the garden for the plants. ??Nettie Hoge -- Age: 50. ???-- Residence: Oakland. ???-- Job: Executive director The Utility Reform Network October 1995 to present. The utility and telecommunications industry watchdog group in San Francisco represents consumers before the Public Utilities Commission the Legislature and elsewhere. ???-- Education: Bachelor's degree in communications Phi Beta Kappa from Washington State University 1976. Law degree cum laude from University of San Francisco 1985. ???-- Background: Most of Hoge's 25-year career has been spent protecting the little guy first as a social worker and later as an attorney with Consumers Union and the California Department of Insurance under Insurance Commissioner John Garamendi.E-mail Chuck Squatriglia at csquatriglia@sfchronicle.com. GRAPHIC: PHOTO (1) Nettie Hoge is respected for her encyclopedic knowledge of regulatory issues. (2) Nettie Hoge has headed The Utility Reform Network for six years. I've always wanted to do this she says. / John O'Hara/The Chronicle LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 The Washington Post Washington Post ????????????????????April 30 2001 Monday Final Edition SECTION: A SECTION Pg. A03 LENGTH: 1669 words HEADLINE: Energy Forecast for Summer: No Blackouts but Price Spikes Grid Managers Promote Conservation Await New Plants BYLINE: William Claiborne Washington Post Staff Writer DATELINE: CHICAGO BODY: ??The rest of the United States is virtually certain to escape rolling blackouts this summer like the ones that have plagued California but record price hikes for electricity are likely in many places energy experts agree. ???Despite their confidence that they can survive everything but an extremely hot summer without power outages managers of the nation's interconnecting electrical power grids are anxiously awaiting new power plants that are scheduled to come on-line. They are also promoting more frugal consumption by power customers and seeking ways to avoid distribution logjams during peak demand periods this summer. ???We see a big distinction between California and the rest of the country said David Costello an economist in charge of short-term forecasting for the Energy Information Administration the statistical arm of the Department of Energy. We have no real reason to believe anyplace is unusually at risk. ???But record spikes in the price of electricity are a given for this summer some industry analysts say because a growing proportion of power plants now run on natural gas which has doubled in price over the past year. ???The DOE estimates that electricity demand will grow 2.3 percent nationally this year with much higher increases in the West and the South. At the same time the reserve capacity margin that utilities try to build into their systems to handle the hottest days -- when use of air conditioners and other appliances taxes supplies -- has been falling in some regions to well less than the desired 15 percent above peak summer loads. ???That means utilities may have to import large volumes of electricity over transmission systems that were not designed to handle them. What power officials are hoping to avoid are critical shortfalls in generating capacity in some regions followed by overwhelming strains on aging high-voltage transmission lines as power is bought and sold across the country in increasingly competitive electricity markets. ???Even though scores of new power plants have been built in the Northeast South and Midwest in recent months and many more are on the drawing boards the expected 15 percent increase in new generation will not be fully on-line for another two years. That leaves parts of the nation vulnerable to outages if there are prolonged heat waves this summer or if utilities are unable to start up new or rebuilt gas-fired power plants as scheduled according to energy experts. ???Despite all those potential problems there is no reason to believe that California's power nightmares will spread to the rest of the country officials said. ???This year utilities have announced they are adding 40 to 50 gigawatts of new generating capacity to gas-fired plants across the nation compared with only 22 gigawatts that were added last year Costello said. He said that even if half of those announced plants never materialize this year's new capacity is certain to be as great or greater than last year's meaning that the predicted increased consumption can probably be met. A gigawatt is 1000 megawatts or enough to power about 1 million homes. ???We don't know that [transmission] infrastructure has really been fixed but my sense is they're in better shape overall as far as capacity is concerned Costello said. ???The nation's 203600-mile high-voltage network has undergone relatively few changes in 50 years during which deregulation has prompted electricity wholesalers to sell power at even greater distances to reach more lucrative markets adding to the pressure on the grid system. ???California in a sense has been serving as a stalking horse for other states some of which also deregulated their electricity systems and are consciously avoiding doing anything that resembles the California model. ???Eugene Gorzelnik spokesman for the North American Electric Reliability Council (NERC) which oversees the interlocking power grids said: Obviously there will be problems in California and there's nothing that's going on that will solve those problems. But a lot of [utilities] people are looking at California and saying to themselves 'Can I do this in a way they didn't?' That's a positive development. ???Apart from California the worst problems are expected in adjoining western states as Golden State electrical grid managers scramble to buy electricity at a time when power production at the region's hydroelectric dams is already being cut because of shrinking water levels in reservoirs. ???The Northwest Power Planning Council recently reported that the demand for electricity has grown 24 percent in the past decade while new generation has grown only 4 percent. ???NERC is not expected to issue its long-awaited pre-summer electricity reliability assessment -- a document that forecasts peak generation and consumption -- until next month. But in interviews officials of many of the 10 regional reliability councils that comprise the national grid system appeared fairly sanguine about the prospect of avoiding widespread brownouts this summer. ???Assuming normal weather and assuming our generating units come off maintenance on schedule we don't anticipate any particular problems meeting our loads said Bill Reinke executive director of the Southeastern Electricity Reliability Council. ???Reinke said the region was adding 300 miles of new transmission lines has 5600 megawatts of new generating capacity -- enough to power 5.6 million homes -- and is seeking to identify potential transmission bottlenecks so it can take preemptive corrective measures against distribution failures. ???Outside the West the greatest potential for blackouts may be in New York where the near certainty of transmission logjams in an antiquated infrastructure prompted Consolidated Edison Co. to request approval for 11 combustion turbine mini-generators in case of a power shortage. Residents and conservationists are appealing court approval of the generators on environmental grounds. ???Stephen Allen spokesman for the Northeast Power Coordinating Council said If the 400 megawatts the generators provide go on-line it'll still be tight but New York should be okay. He said Upstate New York should have surplus electricity to sell to New York City although some experts say transmission bottlenecks could make it difficult for New York City to import power on abnormally hot days. ???New York City customers who have already had their electricity rates increased 40 percent in the last two years could see prices rise an additional 50 percent because of the deregulated power industry's dependence on gas-fired generation according to some analysts. ???Allen said that since last June New England has added mostly gas-fired plants that generate more than 1000 megawatts and should have an additional 2000 megawatts on-line before the end of the summer. He said the region should have a 15 percent to 18 percent capacity margin. ???The Mid-Atlantic Area Council made up of Maryland Virginia the District of Columbia Delaware New Jersey and Pennsylvania is expecting a reserve margin of more than 16 percent and an increase of 2100 megawatts in generating capacity over last year to about 60000 megawatts according to the council's president Phillip G. Harris. Harris said the council met last year's peak of 49288 megawatts with no problems though the summer of 2000 was relatively cool. ???Harris cited several reasons why we are not like California including a decision to centralize all planning which California did not the creation of a regional market instead of a state-based marketplace like California's and a policy of only slow incremental changes in the grid. ???A single misstep can have huge consequences Harris said. We're tinkering with something that has worked for 100 years so you better do it right. ???In the Midwest utilities expect a peak demand this summer of 55221 megawatts compared with 52214 megawatts last summer according to Richard Bulley executive director of the six-state Mid-America Interconnected Network. But keeping pace with the nearly 6 percent increase in demand is the addition of 5470 megawatts of capacity Bulley said. ???We do not anticipate any major limitations on the region's bulk transmission system and we project a healthy reserve margin of more than 18 percent he said. ???Since 1998 33 companies have proposed projects in Illinois totaling 25000 megawatts of gas-fired power. Although no one expects all of that to come on-line the state's total generating capacity is just under 34000 megawatts meaning that even if only a modest amount of the anticipated power was added the region would have a cushion even in a hot summer. ???Officials of Commonwealth Edison Co. the biggest utility in Illinois say that new or rebuilt electrical distribution facilities should prevent a repeat of the kind of disastrous power outages that crippled offices in Chicago's Loop last summer when lines broke and transformers burst into flames. ???Few power grids are in as good shape as Texas's. The state anticipates a 23 percent power margin this summer and the addition of 9188 megawatts of new generating capacity this year according to Heather Tindall spokeswoman for the Electric Reliability Council of Texas (ERCOT). Texas utilities have 27 new power plants under construction and 31 more in the planning stages she said. ???As a result ERCOT is forecasting almost 70000 megawatts of generating capacity this summer compared with a peak demand of 57600 megawatts on one 111-degree day last summer. ???Tindall said that after studying California's system the Texas grid made a concerted effort to operate theirs differently. For example she said Texas supports utilities entering into long-term contracts for power while in California power companies did not enter into such contracts and were forced to pay exorbitant prices at peak times. LOAD-DATE: April 30 2001 of 103 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????April 30 2001 Monday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 594 words HEADLINE: Developments in California's energy crisis BYLINE: By The Associated Press BODY: ??Developments in California's energy crisis: ??MONDAY: ??- Members of the Assembly Subcommittee on Natural Gas Costs and Availability unveil legislation to cut natural gas prices. ??- The state remains free of power alerts as electricity reserves stay above 7 percent. ??FRIDAY: ??-Gov. Gray Davis calls a federal regulatory order a Trojan horse that will profit power generators at California ratepayers' expense. The Federal Energy Regulatory Commission is considering requiring the state's electric grid operator to add a surcharge on power sales to pay generators the money they are owed by the state's two large financially strapped utilities. ??- State power buyers have asked for another $500 million to buy electricity for the customers of three cash-strapped utilities. That brings the total amount authorized for power purchases to $6.2 billion since mid-January when the state began purchases power for Pacific Gas and Electric Co. Southern California Edison and San Diego Gas and Electric. ??- Gov. Gray Davis says state office buildings cut energy use by an average of 20 percent in January and February saving taxpayers $286000 in utility bills. ??- State officials negotiating long-term power contracts for customers of three cash-strapped utilities have secured five more contracts. Four of the contracts signed in March by the Department of Water Resources will provide 466 megawatts of electricity during times of peak demand this summer according to DWR documents. One megawatt is roughly enough power for 750 homes. ??- California Public Utilities Commission attorneys are advising state agencies to avoid submitting monetary claims against Pacific Gas and Electric Co. despite the company's bankruptcy. The PUC is trying to retain their electric rate-setting authority over the utility and says submitting claims could bring the state under the court's jurisdiction as a creditor which could allow the judge to set electric rates. ??- Shares of Edison International closed at $9.90 up 15 cents. PG&E Corp. closed at $8.94 up 20 cents. ??-The state remains free of power alerts as reserves stay above 7 percent. ??WHAT'S NEXT: ??- Davis' representatives continue negotiating with Sempra the parent company of San Diego Gas and Electric Co. to buy the utility's transmission lines. Davis says he expects to have an agreement within two weeks. ??THE PROBLEM: ??High demand high wholesale energy costs transmission glitches and a tight supply worsened by scarce hydroelectric power in the Northwest and maintenance at aging California power plants are all factors in California's electricity crisis. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Electricity and natural gas suppliers scared off by the two companies' poor credit ratings are refusing to sell to them leading the state in January to start buying power for the utilities' nearly 9 million residential and business customers. The state is also buying power for a third investor-owned utility San Diego Gas & Electric which is in better financial shape than much larger Edison and PG&E but also struggling with high wholesale power costs. ??The Public Utilities Commission has raised rates as much as 46 percent to help finance the state's multibillion-dollar power buys. LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 Associated Press Online 29 2001 Sunday SECTION: Domestic non-Washington general news item LENGTH: 1313 words HEADLINE: ?Geothermal Plants Need More Steam BYLINE: JENNIFER COLEMAN DATELINE: MIDDLETOWN Calif. BODY: ???Geothermal plants in The Geysers area north of the Napa Valley have tapped steam fields to produce electricity since the 1960s. The 350-degree steam rushes more than 1500 feet up from the earth spinning turbines that create a constant flow of electricity. ??But mismanagement of the steam fields beneath the hilly northwestern California region that straddles the Sonoma and Lake county lines has led to a large decline of pressure and a drop of more than 50 percent in the amount of power the plants produce. ??The geothermal decline comes as California already faces short supplies of hydroelectricity from the drought-ridden Pacific Northwest and growing competition for megawatts from other power-starved states. ??State power grid managers estimate they're losing about 900 megawatts of geothermal electricity due to the gradual depletion of the steam fields. That's enough power for roughly 675000 homes. ??''They just overproduced. It is a renewable source of power but it's renewable over geologic time'' says Katherine Potter a spokeswoman for Calpine Energy which owns 19 of the 21 geothermal power plants in The Geysers region which incidentally has no geysers. ??The first electricity produced by tapping into pockets of steam trapped in the earth made its debut in 1904 in Larderello Italy. That plant rebuilt due to World War II damage is still operating. The first U.S. geothermal plant was a small operation at The Geysers built in 1962. ??Steam fields are created when water flows through fissures in the rock deep in the earth and is heated by hot magma. Geothermal plants tap into that pressure and use it to spin turbines. The plants' cooling towers release plumes of white steam which can be seen for miles on a clear day. ??While The Geysers is a unique geologic formation called a dry steam field there is the potential for thousands of megawatts of geothermal power from other regions that could use the more common ''wet steam'' process said Karl Gawell executive director of the Geothermal Energy Association in Washington D.C. ??Wet steam plants tap into superheated water in the earth separate the steam and use it to power generators. The water and the condensed steam is pumped back into the earth. ??CalEnergy Corp. owns 10 power plants in Imperial County that produce about 330 megawatts of power enough for about 247500 homes. Those plants and others like them haven't seen a decline in pressure like Calpine's plants. ??Geothermal energy is second only to hydroelectricity as a continuous cheap source of power said Jan Stewart Calpine's public relations manager. ??The plants in The Geysers reached their peak power production in the 1980s producing about 2000 megawatts of electricity enough to power about 1.5 million homes. ??At that time about 30 companies were involved in various geothermal ventures in the area and didn't work together Stewart said. ??''The resource wasn't being managed properly. As a result it was a very fractured environment'' she said. ''If one plant shut down the steam would be vented to the atmosphere instead of being rerouted to another plant where it could be used.'' ??In the 1960s and '70s when The Geysers got started there was ''a real wildcatter's mentality'' among power generators said Rich Ferguson energy chairman for Sierra Club California. ??''Basically they took out the water in the form of steam faster than Mother Nature was putting it back in'' he said. ??The available steam declined and the area now puts out about 850 megawatts sufficient power for roughly 637500 homes. ??Since then geothermal engineers have learned more about managing the resource Ferguson said. ??The superheated self-contained system at The Geysers has no ??ater running through it. ?''The Geysers is unique worldwide. There really aren't other dry steam fields'' Gawell said. ''In effect there was never a sustainable level of production you always would have depleted it eventually. It's like a giant pressure cooker. As soon as you put the first straw in you began to deplete the resource.'' ??Calpine is experimenting with replenishing the steam fields by pumping treated waste water back into the earth. It began three years ago when Lake County stopped pumping its treated waste water into Clear Lake. ??Now more than 8 million gallons of treated waste water is returned daily to the earth. The experiment appears to be working _ power output is up 68 megawatts. ??''People like the stewardship that Calpine provides now'' Ferguson said. '' Calpine has taken on as a long-term goal to make that sustainable.'' ??Calpine is building a 50-mile pipeline to Santa Rosa and plans to pump another 11 million of treated waste water daily from that city. The company expects that will boost production another 85 megawatts. ??Even with the new project power grid managers say they're planning for diminishing geothermal electricity. ??''We've lost a considerable portion of their output due to the decline in the output of the steam'' said Jim McIntosh director of grid operations for the Independent System Operator. ''All supplies are very important to us at this point.'' ??The plants are relatively low-maintenance once they're running _ only one engineer staffs each of the 19 Calpine plants in The Geysers. ??But geothermal plants are more expensive to build than natural gas-fired power plants Gaywell said. ??''It's like choosing between two identical cars one is $10000 and the other is $30000 but the $30000 car comes with a lifetime supply of fuel'' he said. ''People are shortsighted on investments and it takes more money upfront to build geothermal.'' ??Most geothermal resources are on public land lengthening the building process because more permits are needed Gawell said. ??Two new plants are in the application process in California. ??Researchers estimate there are 2500 megawatts of untapped geothermal resources in Nevada Gawell said. Idaho New Mexico and Oregon also have sites that could be tapped he said. ??''Many of these sites were looked at in the '80s but then nothing happened because in the '90s natural gas was too cheap to meter'' he said. ??Ferguson said the state spent $540 million over the last four years on incentives for renewable energy projects including geothermal solar wind and biomass and he expects the plan will be renewed when it expires in December. ??''We think there will be an equivalent amount of money'' he said. ''All the technologies have to compete against each other but geothermal should do pretty good.'' ??___ ??There are three types of geothermal power plants. Here's a look at how they work: ???Dry steam: Such plants are rare producing steam and not hot water. The Geysers region is the world's largest dry steam field. Steam from the earth is piped to the power plant where it spins turbines to create electricity. After the remaining steam condenses back to liquid it is returned to the earth. ???Wet steam: This type of geothermal plant is more common. There are several such plants in Southern California. Hot water and steam are brought to the surface separated and the steam is used to power turbines. The water is returned to the earth as is the condensed steam. ???Binary: These plants use hot water and steam from the earth to heat another liquid such as isobutane which has a lower boiling point than water. That liquid's steam is used to power turbines to make electricity. When the steam cools and becomes liquid it's returned to the tank and reused. This type of system is self-contained and has no emissions. ??___ ??On the Net: ??Geothermal Education Office: http://geothermal.marin.org ??California ISO: http://www.caiso.com ??Calpine Corp.: http://www.calpine.com ?????(PROFILE ?????(CO:Calpine Corp TS:CPN IG:ELC) ?????) LOAD-DATE: April 29 2001 of 103 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????April 29 2001 Sunday BC cycle SECTION: State and Regional LENGTH: 413 words HEADLINE: Guns in schools deregulation delay on lawmakers' agenda BYLINE: By BRAD CAIN Associated Press Writer DATELINE: SALEM Ore. BODY: ??Backers of a bill to prevent holders of concealed handgun licenses from bringing their weapons onto school property will spend the coming week trying to force a Senate vote on the issue. ??Also this week House Speaker Mark Simmons is planning to schedule a hearing on his bill to pull the plug - at least for now - on a key part of an electric deregulation law that's due to take effect this fall for large businesses. ??The guns-in-schools bill has been on life support for weeks with a key Senate committee chairman refusing to schedule a hearing on the bill on grounds that it is overly contentious and wouldn't pass anyway. ??The sponsor of the bill Sen. Ryan Deckert D-Beaverton and other supporters aren't giving up however. ??They are hoping to use a parliamentary maneuver that would enable them to move the school guns issue to the full Senate for debate by attaching it to another education-related bill. ??Gun owner groups say SB508 is unnecessary because there have been no documented cases of law-abiding carriers of concealed handguns causing any problems at schools. ??But a key supporter of the bill Sen. Ginny Burdick D-Portland says she is convinced the measure would pass in both the House and Senate - if it can be brought up for vote. ??I don't think we should wait to have dead children before we ban guns in schools said Burdick who was a chief sponsor of a measure passed by voters last fall expanding background checks at gun shows. ??California's power woes that were precipitated by that state's move to deregulation are giving Oregon lawmakers second thoughts about their decision to approve a phased-in deregulation of the electricity market in Oregon. ??A bill passed by the 1999 Legislature is supposed to open Oregon's electric markets to industrial and large commercial customers beginning this October. ??The 1999 law is supposed to free large businesses to buy power on the open market and does not deregulate electric rates for residential customers. ??Still Simmons says that drought conditions and the power market turmoil caused by California's energy crisis require reconsideration of the law. ??For that reason the House speaker is planning hearings this week on his proposal to enact a 15-month delay in Oregon's electricity restructuring efforts. ??This just gives the opportunity for the energy markets to settle for a while the Elgin Republican said. ??Similar legislation is pending in the Senate. LOAD-DATE: April 30 2001 of 103 DOCUMENTS 2001 The Post Register Falls Post Register 29 2001 Sunday SECTION: News Pg. a1 LENGTH: 530 words HEADLINE: Plenty of blame to go around for West's power woes BYLINE: PAUL MENSER BODY: ??When it comes to power the West is a mess. ??Because of its botched deregulation attempts California bears a lot of the blame - but not all of it said Susan F. Tierney a former assistant secretary in the Energy Department now a consultant for Lexecon a Cambridge Mass. consulting firm. ??Like planets lining up to usher in an age of hysteria a combination of unforeseen circumstances have put the Northwest behind the eight ball. In addition to California's self-created tangle oil and natural gas prices are rising and a drought is stymieing the region's hydropower production. ??The situation is less volatile in other parts of the country. In the Northeast South and Midwest where growth has been modest and generating capacity has been more stable there's less discrepancy between supply and demand. ??Undergirding the West's situation was some serious lack of foresight Tierney said. ??When it looked like California power customers would be able to get electricity from whoever offered it at the cheapest price utilities worried about recovering the money they'd spent building plants and transmission lines in the '70s and early '80s. So they sold off their power plants and bought power on the wholesale market where it was cheap and plentiful. ??Not trusting the marketplace California legislators capped the rates utilities could charge residential customers. When wholesale power prices went up they couldn't pass those increases on to consumers. ??At the time they did not realize that in a couple of years there would not be an adequate power supply Tierney said. ??California's economic explosion of the late '90s coupled with a failure to build any new plants brought the crisis to a head. Computers are not by themselves big energy consumers but the factories that make them are. The Internet with all its server farms and data hotels also became a heavy power user. ??When demand in California finally caught up with supply all of a sudden utilities had to buy power and it became a seller's market Tierney said. ??But most of the Northwest's power comes from hydroelectric dams and there has to be water in the rivers to power the turbines at the dams. In a drought year like this the power has to come from somewhere else most likely oil- and natural gas-fired plants which fire up when demand is high. ??Because demand is so high this year generators can charge exorbitant prices knowing that California and the Northwest have nowhere else to buy power. ??Also natural gas prices have gone through the roof in the last 18 months and aren't likely to come down until next year at the earliest. Until 18 months ago the price of natural gas had been at a prolonged low so companies weren't interested in expensive drilling projects. ??The problem is not likely to be permanent. As exploration and extraction pick up prices will come down. The public has already begun to hear a conservation message and the Federal Energy Regulatory Commission is being deluged with applications for new power plant construction. ??Staff writer Paul Menser can be reached at 542-6752 or via e-mail at pmenser@idahonews.com. LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 29 2001 Sunday Home Edition SECTION: Opinion Part M Page 6 Opinion Desk LENGTH: 1312 words HEADLINE: THE STATE HOW KILOWATT SOCIALISM SAVED L.A. FROM THE ENERGY CRISIS BYLINE: JEFF STANSBURY Jeff Stansbury is a PhD candidate in American history at UCLA. His dissertation is on the role of the labor movement in the building of L.A.'s infrastructure BODY: ??Why is Los Angeles an island of tranquillity in the electric-power crisis that has rocked California and threatens to spread across the nation? ??News stories have repeatedly told us that the city's ownership and operation of its own generating stations is the principal reason. By staying clear of the state's 1996 deregulation scheme for private utilities the Department of Water and Power was able to hold onto its power plants. ??So far so good. But when we ask how Los Angeles came to enjoy public power in the first place the answer commonly given makes a hash of history. ??Most historians and political scientists credit the city's progressive reform movement of 1890-1915 for having wisely settled on a municipal utility. True some of the entrepreneurs lawyers and reform-minded professionals who called themselves the best men during that era agitated for the city-built Owens Valley aqueduct and its generating stations. But many reformers opposed the city's effort to distribute its own power. Because they had allied themselves with railway magnate Henry Huntington who owned an electric company or because they favored regulation over municipal ownership they wanted L.A.'s three private electric companies to sell and profit from aqueduct power. Meyer Lissner a reform attorney often portrayed as a champion of public power opposed the holding of a decisive 1911 citywide straw poll on the subject because he knew most Angelenos would cast their ballots for municipal ownership. That he said would be unfair to the three utilities. ??The most steadfast partisans of public power were not progressive reformers like Lissner but the city's much-maligned labor unions and for a simple reason. While mistrust of oligopoly ran through nearly all sectors of society it burned hottest in working-class wards. Without organized labor's dogged campaign for gas and water socialism as well as its willingness to hand control of these resources to the anti-union regimes of Mayors George Alexander and Henry Rose there would be no DWP today. ??Organized labor played a key role in the city's original decision to municipalize its water distribution system. On Oct. 24 1892 700 union members met to demand that the city build a small neighborhood waterworks as a step toward public control of the entire water supply. From that day on L.A.'s unions never wavered in their call for a public water supply publicly managed. They mobilized the rank and file for the water-company buyouts of 1901-04 and in 1906 the Public Ownership Party's citywide campaign primed voters to pour $ 23 million into construction of the Owens River aqueduct a year later. The aqueduct was the sine qua non of public power. At a time when most progressive reformers were mute on the subject organized labor insisted that the aqueduct be used to generate electricity for the city's streets homes and businesses. ??A broad consensus backed the city's construction of hydroelectric plants while the aqueduct was being built but most of the city's politicians and corporate lobbyists were committed to public subsidies not public ownership of aqueduct power. The 1911 straw poll in which city voters declared their support for municipal ownership and distribution of Owens River power upset their plans. ??The most consistent fighters for public power during the decades after the straw poll were the Central Labor Council International Brotherhood of Electrical Workers other unions and city employees who stuffed campaign envelopes canvassed precincts and got out the vote. Voters who favored municipally owned power and initiatives bolstering the DWP tended to be working class and Democratic those opposed were mainly middle and upper class and Republican. ??In this polarized political climate Mayor Alexander called for a $ 6.5-million bond issue to complete the aqueduct-power distribution network he left open the question of who would sell the power to consumers. Unions and socialists tied their support for the bonds to a city charter reform that would guarantee them a long-sought role in city government through proportional representation. When the reform failed at the polls they withheld support from the power bonds and these too went down to defeat in 1913. Much of the rancor workers felt was aimed at progressives like Lissner head of the Good Government Organization who fought labor's charter plank because it would bring socialists onto the City Council. ??The labor movement's dedication to public ownership soon reasserted itself however. With a citywide election coming up that June five unionists seeking council seats on the Socialist Party ticket revived labor's long-standing demand for city operation of all public utilities at cost. They urged the City Council to hold a new power-bond election with a clear public ownership mandate. They attacked the power companies' efforts to buy aqueduct power from the city and sell it to Angelenos at a profit. Soon the great majority of unions in the Central Labor Council were locked in what turned out to be a decisive struggle against the power oligopoly made up of Southern California Edison Pacific Light & Power and Los Angeles Gas & Electric. ??An unprecedented event brightened the bonds' chances. A machinist Fred C. Wheeler won a seat on the City Council the first unionist to do so in the 20th century. Wheeler led a successful fight against an attempt to split the power-bond issue into two separate ballot propositions one to complete the aqueduct's generating stations the other to create a city-owned distribution system. Such a division would probably have doomed public power. ??The large majority of unionists who favored public power had little time to savor Wheeler's victory. While pressing the attack on the three electric companies they faced a small but angry split in their own ranks. Dissenters in the Building Trades Council and a few of its unions argued that labor's grievances against the progressive regimes of 1909-14 had turned the argument for municipal ownership on its head. What good was municipal ownership in the hands of a council and mayor who had caused the arrest of hundreds of peaceful picketers during the citywide strikes of 1910 had underpaid aqueduct workers and fed them bad food and had denied unionists influential city jobs? The final blow was the council's rebuff of a petition signed by thousands of workers for a living wage law. Was it not folly to reward labor's foes with control of the aqueduct's power? ??Union activists who favored the bonds conceded that the dissenters were correct in their assessment of progressive city government. But the progressive star was fading. What counted in the long run was whether Los Angeles could wrest the city's electric power system from the grasp of private utilities. The Central Labor Council's unions took this challenge to heart and voted 60-4 for a resolution favoring the bonds. ??On its own as well as in coalition with other groups the labor movement marshaled its rank and file on behalf of public power. It turned out hundreds of poll-watchers and canvassers on election day. The pro-bond unions never did win over the dissenting faction rather they overwhelmed it at the polls. On May 8 1914 L.A.'s voters emphatically endorsed the power bonds by a hefty 71%-29% with the city's working-class wards providing by far the largest margin of victory. ??Within a year Los Angeles sold its bonds and began buying out the three investor-owned utilities. The first public power flowed into local homes and businesses in 1916. Two decades later the DWP eliminated the last of its private competition and consolidated the working-class legacy of kilowatt and water socialism that has served the city so well in the current energy crisis. GRAPHIC: GRAPHIC-DRAWING: (no caption) JENNIFER HEWITSON / For The Times LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 29 2001 Sunday Home Edition SECTION: Opinion Part M Page 4 Editorial Writers Desk LENGTH: 558 words HEADLINE: CONSERVATION SANDBAGS THE DAVIS ADMINISTRATION NEEDS TO LAUNCH A CRASH EDUCATION COURSE TO CONVINCE CALIFORNIANS OF THE SERIOUSNESS OF THE ELECTRICITY CRISIS AND THE NEED FOR FAR-REACHING ENERGY-SAVING MEASURES. BODY: ??Natural disasters and crises can be devastating but are relatively simple and easy to grasp. A brush fire you fight with shovels. An earthquake you clean up the rubble afterward and strengthen buildings in anticipation of the next. But California's energy crisis is far different and more complex. It's a quiet disaster on scattered invisible fronts. Most people see it only when their own lights go out. ??There also is no precedent for this crisis in California and no accurate way to forecast how bad it can get either the blackouts or the financial consequences. But as May approaches it's certain that most Californians are not adequately informed about the severity of the problem or what they can do to limit its impact. ??Gov. Gray Davis the utilities and others need to engage in a crash education program that will convince Californians of the seriousness of the problem and motivate them to undertake their own conservation programs in homes and businesses. California has been a pioneer in power conservation and its citizens will listen to persuasive reasoning. ??As the chairwoman of the state Senate's Energy Committee Sen. Debra Bowen (D-Marina del Rey) deals with problems ranging from utility company insolvency to rate gaming by energy producers. But I'm really worried about this summer she said last week referring to the potential for day after day of rolling blackouts. She told of one businessman in her district who reported he will lose an estimated $ 30000 every time his power is cut. Why not at least schedule blackouts so people can plan for them? she asked. Why not? ??In San Francisco the Bay Area Economic Forum released a study indicating that power woes could deliver a $ 17-billion blow to the state's economy in lost production the cost of rate increases and increased product prices. That may be conservative. The study did not include the $ 5.1 billion the state has spent so far to buy power for the insolvent private utilities. ??Republicans in the Legislature are stalling bills that would float a $ 10-billion revenue bond issue to finance power purchases and keep the state fiscally above water. They have latched onto a powerful issue Davis' unwillingness to detail how he's spending the taxpayers' billions. Davis says he needs secrecy for competitive reasons as he bargains with power companies though he is letting out a slightly wider trickle of figures. ??Wall Street already wary about the credit-worthiness of the state thinks poorly of the delay in issuing the bonds. Republicans should put a temporary hold on their battle with Davis and get the measure to the governor's desk this week. ??Lawmakers were slow in passing an $ 850-million conservation program Bowen acknowledges. But Davis put the new program on a fast track Friday and made a smart choice in S. David Freeman former chief of the Los Angeles Department of Water and Power to run the conservation effort. ??Freeman 75 is a canny veteran of electric power politics. Davis may abhor giving out bad news but Freeman need not shrink from it. Freeman should be on radio and television every day telling California just how bad the problem is and what they can do about it. If this were a flood we'd be stacking sandbags. Our sandbags are conservation programs. We need to start stacking them now. LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 29 2001 Sunday Home Edition SECTION: Part A Part 1 Page 27 National Desk LENGTH: 1316 words HEADLINE: BUSH: THE FIRST 100 DAYS BUSH IS OFF TO A ROCKY START IN HIS HANDLING OF ALL THINGS CALIFORNIAN POLITICS: BUT WHY WOO THE GOLDEN STATE WHEN HE CAN'T CARRY IT IN AN ELECTION 'NO MATTER HOW HARD HE TRIES' ONE ANALYST POINTS OUT. BYLINE: RICHARD SIMON TIMES STAFF WRITER DATELINE: WASHINGTON BODY: ??So what if President Bush has opposed electricity price controls sought by California officials? Or that he has proposed cutting aid to states for incarcerating illegal immigrants convicted of crimes? Or that he has visited 26 states in his first 100 days in office--but not the most populous? ??Bush really does care about California the White House insists even if the state preferred Al Gore on election day. Administration officials said they have done a lot and plan to do more to lessen the electricity turmoil expected this summer. ??I don't think he's treated California any differently than any other state said Rep. George P. Radanovich (R-Mariposa). ??Some Californians feel otherwise. ??The Bush administration's treatment of California started at indifference moved to neglect and has now reached actual harm complained Phil Schiliro chief of staff for Rep. Henry A. Waxman (D-Los Angeles). ??Sen. Dianne Feinstein (D-Calif.) has asked three times for a meeting with Bush to discuss the energy crisis. Her response from the White House: a form letter with her name misspelled. ??Bush has called for requiring public agencies to buy costly earthquake insurance a measure opposed by California lawmakers of both parties. He has proposed cutting an earthquake preparedness program. And he provided no money in his proposed budget to clean up a pile of uranium processing waste in Utah leaking into the Colorado River. ??That's our water supply political analyst Sherry Bebitch Jeffe said. What kind of message is that? ??John J. Pitney Jr. associate professor of government at Claremont McKenna College said Bush's apparent indifference makes political sense. ??It's hard to argue that Bush should spend any political capital in California he said. The 2000 election suggested that he cannot carry the state no matter how hard he tries. The Republicans have already lost several House seats and have probably hit rock bottom. . . . From a purely political angle there's little point in giving California any money or attention that could otherwise go to more competitive states such as Florida. ??But Jeffe senior scholar at USC's School of Policy Planning and Development said Bush's failure to visit the state is hurting GOP efforts to rebuild itself in California. We are ground zero for the kind of Latino outreach that he said he wanted to do. ??And veteran California Republican political strategist Kenneth L. Khachigian said Bush at least needs to prepare for the electricity problems predicted for summer. ??If you get three or four days of successive blackouts air conditioners going out traffic lights going out a second bankruptcy--whether he wants it or not--it's his problem Khachigian said. It would be wise for him to have a proactive stance not just reactive. ??Tough Act to Follow ??Some political analysts have suggested that if Bush becomes too involved in California's troubles what is now Democratic Gov. Gray Davis' problem could become Bush's. But Khachigian said there's a fine line between taking responsibility for a problem and claiming that California isn't part of the United States. ??In dealing with heavily Democratic California Bush has made this much clear: He is no Bill Clinton. ??Bush has a hard act to follow. When Clinton was president he visited California often and rewarded it with federal largess. And California in return showered him with buckets of campaign dollars and electoral votes. ??But Rep. Ed Royce (R-Fullerton) said California will benefit from Bush's presidency too. As Californians bear a disproportionately higher tax burden they stand to benefit greatly from the president's tax relief plan. ??While House spokeswoman Claire Buchan assured that Bush will visit California soon. His wife already has done so. ??As proof that California is on their mind administration officials point to the three Californians in the Cabinet--Ann M. Veneman of Agriculture Norman Y. Mineta of Transportation and Anthony J. Principi of Veterans Affairs--and others in top White House jobs. ??Bush also has appointed California Latinos to high-level posts: Huntington Park Councilwoman Rosario Marin as treasurer Los Angeles entrepreneur Hector V. Barreto Jr. as head of the Small Business Administration and former San Mateo County Supervisor Ruben Barrales as deputy assistant for intergovernmental affairs. ??Critics said that a Californian at the top does not guarantee that the Cabinet departments will develop California-friendly policies. The proposed Agriculture budget for example provides only $ 5 million--not the $ 15 million that California lawmakers said they need--to fight the glassy winged sharpshooter an agricultural pest that threatens the state's wine industry. ??A spokesman for Veneman assured that additional funding will be considered if requested by California lawmakers. And Rep. Mike Thompson (D-St. Helena) who assailed Bush for missing opportunities to help California nonetheless expressed confidence in Veneman. She's going to keep pounding away to make sure that the California wine industry gets what it needs. ??Some Good News ??Though he has proposed cuts in some programs that are important to California Bush has taken some actions that please state officials. He has proposed a permanent research and development tax credit--an action that would particularly benefit Silicon Valley. ??His proposed budget includes additional money to crack down on illegal immigration and drug smuggling and unsafe trucks crossing into California from Mexico. And he has proposed increased funding to reduce backlogs at immigration offices. ??In one area Bush even bested Clinton. He proposed $ 14 million to clean Lake Tahoe more than the $ 3 million recommended by Clinton last year. ??And although he has drawn flak for proposing cuts in programs to promote energy efficiency and alternative fuels his proposal to boost assistance to low-income families for insulating their homes and reducing their utility bills would nearly double California's allocation to $ 8 million next year. ??No Bush policy has been more criticized in California than his approach to the state's energy woes--particularly his adamant opposition to price controls. Steve Maviglio a spokesman for Davis said Bush and his aides got off to a strong start by extending federal orders sought by the state to keep power flowing into California. ??Since then . . . they've been AWOL Maviglio said. In a reference to price controls he added: They're skirting around the edges of the problem without taking the bold action they need to take. ??The feds are the only ones who can step in and bring some sanity to the cost of electricity in California Thompson said. ??Administration officials said they have taken steps from our first hours in office to address the energy crisis. They said they have responded favorably to all the state's requests except price controls which Bush contends would discourage the building of power plants. ??While some seek to portray Bush's opposition to price controls as unsympathetic to California's plight a number of California's House Republicans also oppose price controls. And even those who support them argue that the issue misses the larger point. ??Rep. Randy Duke Cunningham (R-San Diego) an advocate of price controls nevertheless said: I agree with the administration that the state alone remains responsible for solving this crisis. ??Added Rep. Mary Bono (R-Palm Springs): I don't believe Bush should bear the brunt of responsibility that the Clinton administration left over. ??Tim Ransdell executive director of the California Institute for Federal Policy Research doubted that Bush would ignore California. California represents one-eighth of the nation. One in eight Americans can't be ignored. LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ?????????????????????April 29 2001 Sunday Home Edition SECTION: Business Part C Page 2 Financial Desk LENGTH: 1290 words HEADLINE: WEEK IN REVIEW TOP 10 STORIES / APRIL 23-27 BYLINE: Lisa Girion and Terril Yue Jones and Sallie Hofmeister and James Bates and Peter Pae and Jeff Leeds and Nancy Rivera Brooks and Peter Gosselin BODY: ??1. Economic Growth a Welcome Surprise: The U.S. economy grew at an unexpectedly strong 2% annual rate in the first three months of the year thanks largely to buoyant shopping by American consumers. The gross domestic product--the country's total output of goods and services--expanded at twice the pace it did in the final three months of 2000 and at twice what analysts had expected the government said Friday. Although many analysts said the economy remains balanced between strong growth and recession economic optimists exulted over the report. Fed Chairman Alan Greenspan added to the celebratory mood by saying that a key trend behind the economy's strong performance of the last decade--its ability to improve productivity--is likely to resume despite the current slowdown. ??(Peter Gosselin) ??* ??2. Stocks Rise on Good News: The GDP report boosted stock prices which already had gotten a lift from better-than-expected home sales figures earlier in the week. The Dow Jones industrial average rose 117.70 to close at 10810.05 on Friday up 2.2% for the week while the S&P 500 index climbed 18.53 to 1253.05. The Nasdaq which had fallen Thursday on concerns over weak technology profits rose 40.80 to 2075.68 finishing the week down 4.1%. Meanwhile the yield on the benchmark 10-year Treasury note rose to 5.33% from 5.19%. ??(Times Staff Writer) ??* ??3. Power Crisis Zaps State Bond Rating Price Controls OKd: The mounting cost to the state general fund of buying electricity for California consumers prompted Standard & Poor's Corp. to downgrade $ 25 billion of California's general obligation bonds. S&P lowered California's bond rating by two notches to A-plus from AA. The move could add hundreds of millions of dollars to the state's borrowing costs bond experts said. Separately federal regulators approved a plan to control electricity prices in California during times of supply shortages. The Federal Energy Regulatory Commission tied prices during power emergencies to the cost of natural gas and emission controls among other things with the least efficient generator setting the market price. Critics said the order contains loopholes that will allow market manipulation. ??(Nancy Rivera Brooks) ??* ??4. FTC Pans Music Industry Marketing: A much-anticipated sequel to last year's Federal Trade Commission report on the marketing of violent entertainment to children slammed the record industry for failing to heed regulators' recommendations. Though it gave some credit to the film and video-game industries for revising the way they marketed to young audiences the FTC found the five major record conglomerates continued to advertise explicit-content albums on popular teen shows such as MTV's Total Request Live and BET's Top 10 Live. Just before the release of the first report the Recording Industry Assn. of America had blunted some of the criticism by introducing a policy against ads for such albums on TV shows or in publications whose audience is mostly 16 years old or younger. But the RIAA said it rescinded the policy in September. ??(Jeff Leeds) ??* ??5. Gas Prices Continue Upward Spiral: The average price of self-serve regular gasoline spurted higher again in California and around the nation on an increase in demand and a switch by refiners to the more costly summer gasoline blend required in parts of the country by air-quality regulations. Prices in California got an extra boost from a fire at a Los Angeles-area refinery owned by Tosco Corp. and by a change in Tosco's pricing strategy. In late March Tosco increased wholesale prices to its dealers in Southern California and Arizona and tied prices to the cost of gasoline in the spot market. Some other major suppliers have begun matching the Tosco increase market experts said. Some market watchers foresee gas at $ 3 a gallon or more. ??(Nancy Rivera Brooks) ??* ??6. General Dynamics Renews Newport News Bid: General Dynamics Corp. agreed to acquire Newport News Shipbuilding Inc. in a $ 2.1-billion deal that would create the nation's largest military shipbuilder and leave only one maker of U.S. aircraft carriers and submarines. The proposed merger which the Pentagon had rejected two years ago marks the latest in a renewed wave of consolidations in the defense industry and would again make General Dynamics one of the largest private employers in San Diego. General Dynamics executives said they are confident of receiving the necessary approvals because this time they will be dealing with the Bush administration which may view the takeover differently. ??(Peter Pae) ??* ??7. Disney Earnings Beat Estimates: Walt Disney Co.'s second-quarter operating results exceeded Wall Street's expectations as the company's studio and consumer products units improved although Disney did post a net loss stemming largely from a one-time charge related to the restructuring of its Internet portal. Disney also confirmed that it will shrink its venerable animation unit with a union official estimating as many as 300 jobs of about 1000 in Burbank could be cut. Separately President Robert Iger confirmed that layoffs will be needed to reach Disney's previously announced goal of cutting 4000 jobs companywide. Disney's studio and consumer products groups showed improved results in the quarter while earnings were flat in its theme parks and softer in broadcasting. ??(James Bates) ??* ??8. New FCC Chief Vows Deregulation: Repudiating decades-old media ownership rules Federal Communications Commission Chairman Michael K. Powell said he envisions a broad rollback of restrictions which could bring about a tidal wave of consolidation. In his most candid remarks about the role of the FCC since taking office Powell said he would move in early May to eliminate regulations that prevent one company from owning a newspaper and a television station in the same city. Powell also told broadcasters meeting in Las Vegas that Viacom Inc. was likely to prevail in its challenge of federal rules that prevent any broadcaster from owning stations that reach more than 35% of the nation's television viewers. ??(Sallie Hofmeister) ??* ??9. Ford Takes More Heat Over Explorer Tires: Ford Motor Co. came under the most direct criticism leveled against it yet regarding last year's massive Firestone tire recall. Two prominent consumer safety groups issued a report saying that the auto maker was largely to blame for accidents in which Ford Explorer sport-utility vehicles equipped with Firestone tires spun out of control after the tires lost their treads. Though they blamed Bridgestone/Firestone for producing tires prone to failure Public Citizen and Safetyforum.com said Ford bore the bulk of the responsibility for dictating an insufficiently robust tire design and designing the Explorer so it would overly stress the tires and tip over too easily once a tire blew. ??(Terril Yue Jones) ??* ??10. American Airlines Sued Over Health Coverage: A flight attendant filed a complaint with the Equal Employment Opportunity Commission in Los Angeles charging that American Airlines discriminated against some employees by refusing to offer insurance coverage for birth control Pap tests and infertility treatments. The case could test the position the EEOC took in December that the federal Pregnancy Discrimination Act forbids employers from excluding contraceptives from prescription drug plans. ??(Lisa Girion) ??* ??These and additional stories from last week are available at divided by category. Click on Money and Investing Entertainment Business and other topics. ??* Please see Monday's Business section for a preview of the week's events. GRAPHIC: PHOTO: Though Disney's second-quarter profit beat Wall Street predictions its theme-park earnings were flat. ?PHOTOGRAPHER: Associated Press LOAD-DATE: April 29 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 The New York Times Company New York Times ?????????????????April 29 2001 Sunday Late Edition - Final SECTION: Section 4 Page 17 Column 1 Editorial Desk LENGTH: 756 words HEADLINE: Reckonings The Real Wolf BYLINE: ?By PAUL KRUGMAN BODY: ??Recently I received a letter from an economist I respect chiding me for my Naderite columns on the California energy crisis. He just didn't believe that market manipulation by power companies could possibly be an important issue it sounded too much to him like the sort of thing one hears from knee-jerk leftists who blame greedy capitalists for every problem be it third-world poverty or high apartment rents. The left has cried Wolf! so many times that sensible people have learned to discount such claims. ??But now a bona fide wolf has arrived whose predatory behavior is doing terrible damage to our most populous state -- and nobody will believe it. ???True California would be heading for a summer of power shortages even if it had never deregulated. And even if there was workable competition in the wholesale electricity market prices in that market would spike during periods of peak demand transferring billions of dollars from either taxpayers or consumers to the generators. ??But the evidence is now overwhelming that there isn't workable competition in California's power market and that the actions of generators gaming the system have greatly magnified the crisis. The key fact is that California has somehow remained in a state of more or less continuous power shortage and very high wholesale prices regardless of the level of demand. A rash of outages has kept the electricity market conveniently -- and very profitably -- short of supply even during periods of low demand when there ought to be lots of excess capacity. ??As Frank Wolak the Stanford economist who also advises the state's power grid has pointed out an outage at a power plant is a lot like an employee calling in sick. You can't tell directly whether he is really sick or has chosen to take the day off for other reasons but you can look for circumstantial evidence. And such evidence has convinced Mr. Wolak that generators use forced outages strategically to withhold capacity from the market -- a view shared by a growing number of other researchers. ??Which brings us to the latest move by the Federal Energy Regulatory Commission. On Wednesday the commission apparently decided to offer California some relief and put new price caps in place on the California electricity market. I say apparently because the more you look at the plan the less likely it seems to be any help at all. Indeed the measure was passed on a 2-to-1 vote with William Massey -- the one commissioner who has been sympathetic to calls for price controls -- voting against it on the grounds that it would be ineffectual. ??What's wrong with FERC's plan? First it caps prices only in emergency conditions -- ignoring the fact that electricity prices have stayed at hard-to-explain levels even when there is no emergency. In effect the plan is laid out as if the electricity market were really competitive in spite of all the evidence that it is not. ??Second even those emergency price caps are full of loopholes offering extensive opportunities for what Mr. Wolak calls megawatt laundering -- selling power to affiliated companies that for one reason or another are exempted from the price controls (for example the controls do not apply to imports from neighboring states) then selling it back into the California market. Severin Borenstein of the University of California Energy Institute adds that because the allowed price depends on the cost of generation at the least efficient plant generators will have a clear incentive to produce inefficiently: I predict we will find some plants we never heard of before that are suddenly operating again and they will be pretty inefficient. ??The general verdict seems to be that this is not a serious plan. There are serious proposals to mitigate the crisis out there -- indeed last fall Mr. Wolak submitted a proposal that was well received by other experts -- but FERC has ignored all of them. ??The charitable interpretation is that FERC still doesn't get it that it just can't bring itself to believe that this time the wolf is real. The uncharitable interpretation is that last week's action was meant to fail. The Medley Report an online newsletter calls the FERC plan a grand exercise in posturing without substance . . . a very clever temporary move by the Bush administration to deflect any political fallout from the looming disaster. ??Whatever the explanation the plain fact is that FERC and the administration have yet to offer California any significant relief. ??http://www.nytimes.com LOAD-DATE: April 29 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 McClatchy Newspapers Inc. Bee ??????????????????April 29 2001 Sunday METRO FINAL EDITION SECTION: MAIN NEWS Pg. A1 POWER CRUNCH LENGTH: 1323 words HEADLINE: Diesel plants spark concern They're expected to generate big air-quality problems when predicted summer blackouts hit. BYLINE: Chris Bowman and Stuart Leavenworth Bee Staff Writers BODY: ??When blackouts roll across California in the coming months - as captains of the crippled electricity grid say they surely will - tens of thousands of miniature powerhouses will whine cough and rumble to the rescue. ??These backup plants will ignite the same fuel that powers locomotives ships and 18-wheel trucks. And they'll be spewing the same pollution - only more so because most are old with little or no emissions controls. ??They are diesel-powered generators the dirtiest of internal combustion engines. And unlike trucks and other vehicles they've largely escaped 30 years of air pollution restrictions because they were intended only for emergencies as when a storm or earthquake knocks out power. ??But now as a season of multiple planned blackouts appears imminent many California businesses are expected to fire up the old stogies more often than was ever imagined. ??And the generators will kick in when their expelled gases can do the most harm. The hot weather that taxes air conditioners and drains electricity supplies also accelerates the conversion of engine exhaust to ozone gas the ingredient in smog that inflames airways and impairs breathing. ??That is why we think this is going to be the most challenging summer ever for air quality said Luna Salaver spokeswoman for the Bay Area Air Quality Management District a nine-county region with thousands of unregulated standby generators. ??On those hot days when we want people to stop driving and doing things that pollute the air the generators will kick in and air quality will worsen Salaver said. ??No one knows how many diesel generators are scattered around the state at hospitals universities factories and businesses. But air districts report there are at least 641 in Sacramento up to 5000 in the Bay Area 1200 in the San Joaquin Valley and thousands more in the smog-plagued valleys of Southern California. ??Some are relatively clean particularly if they have been built or retrofitted in the last few years. But most are tiny pollution factories and were intended only to be run for short periods following natural disasters. ??According to the state Air Resources Board a typical diesel generator emits about 50 to 100 times more smog-forming compounds per unit of energy than a typical gas-fired power plant. When the plants run for hours people downwind can get a heavy dose of the tiny toxic particles contained in diesel exhaust. ??Go down to the Greyhound bus station and have them turn on their engines and hang around there - that's what it's like said Michael Scheible deputy executive officer of the state Air Resources Board which regulates engines and fuels. ??Environmentalists say generators should be cranked up only during power outages. But in recent months farmers and manufacturers have pressured regulators to redefine an emergency and allow generators to be used well before a blackout is ordered. ??Business groups say regulators need to be sensitive to data centers chip makers and other manufacturers that can't afford even a one-second interruption in power. ??We would like some kind of statewide policy on when and where we can use the diesel generators said Gino DiCaro a spokesman for the California Manufacturers and Technology Association. Obviously we would like to use them more than we can now. ??We need to basically let go of this air-quality issue said Mike Jennings a Fresno energy consultant whose clients include members of the food-processing and dairy industries. ??State air and energy regulators are pushing energy conservation as the best way to avoid power outages. Nonetheless the California Energy Commission has been compiling a list of generators statewide to see how their use could be coordinated a move that stirs hope from business groups. ??Six months ago nobody wanted to talk about this because diesel was a big bad word DiCaro said. Now at least we have agencies like the Energy Commission and the Public Utilities Commission talking about how diesel generators can fit into our electrically unreliable world. ??Environmentalists worry that as the summer drags on Gov. Gray Davis will allow unrestricted use of the diesels. ??So far the governor's staff has held firm said Gail Ruderman Feuer an attorney with the Natural Resources Defense Council a national environmental group. But if blackouts start happening in a big way they could change their tune. ??Along with other forecasters officials with the California Independent System Operator manager of the state's electricity grid expect a flurry of blackouts in coming months. The next two months could be critical because most new power plants under construction won't go on line before July. In addition California will be losing one of its largest generators of electricity today when one of two units at the Diablo Canyon nuclear power plant is taken off-line for 35 days of scheduled refueling. ??You should be ready for the worst-case scenario said Del Evans Pacific Gas and Electric Co.'s head of power load management at a media briefing last week. ??For sellers and makers of diesel generators the gloomy predictions are a gold mine. Small businesses farmers manufacturers - all are rushing to buy generators before the blackouts hit. ??We are busier than we have ever been said Rob Bly president of Tuban Industrial Products Co. which assembles about 300 generators a year at its plant in Sacramento. We are twice as busy as we were in the height of the Y2K madness. ??Bly says the generators he makes are 10 times cleaner than ones of a decade ago. Still he acknowledges diesel is diesel. ??If you are a hospital and you want standby power you can't use propane. The fire marshall won't let you said Bly. That leaves you with just one thing and that is diesel. ??Responding to such concerns state Sen. Rico Oller R-Andreas introduced a bill this year to exempt thousands of backup generators from pollution controls whenever any power alert is called. The bill however was blocked by a Senate committee and environmentalists say air districts have already relaxed their rules enough. ??One of the big concerns is the cancer risk Ruderman Feuer said. Air board studies she noted have found that a person's lifetime cancer risk increases 50 percent if he or she lives near a big diesel generator that runs 250 hours a year. ??In January the U.S. Environmental Protection Agency allowed air districts to loosen their restrictions on generators. In turn the South Coast Air Quality Management District extended the number of hours that diesel generators could be operated each year. The San Joaquin Valley Air Pollution Control District went even further allowing businesses to run generators when state power reserves drop to 1.5 percent or when the ISO predicts blackouts anywhere in the Valley. ??The Sacramento Metropolitan Air Quality Management District still requires businesses and public agencies to wait for blackouts before generators are fired up. Altogether the district has permits for 641 generators including major clusters at data centers and companies such as Intel. ??In the Bay Area regulators are even more uncertain of what could happen this summer. Unlike other regions of the state the Bay Area never required permits for diesel generators smaller than 250 horsepower. (In Sacramento the threshold is 50 horsepower.) ??As a result only 12 of the region's estimated 5000 generators are subject to pollution controls. ??Salaver the district's spokeswoman said officials assumed the generators would be used only during earthquakes and therefore didn't need any regulation. ??Now we find people are operating generators even if we are in a Stage Two alert Salaver said. That is not what emergency generators are for. ??* * * ??The Bee's Chris Bowman can be reached at (916) 321-1069 or cbowman@sacbee.com. GRAPHIC: Sacramento Bee / Jay Mather Mark Karakas checks a newly assembled diesel generator at Tuban Industrial Products in Sacramento. Sacramento Bee / Sheldon Carpenter Lights out generators on Diesel-powered generators can save lives during emergencies but they spew far more pollution per unit of energy than other power sources and could significantly degrade air quality during the blackouts expected in the next six months. Smog-forming compounds Power source / Pounds of nitrogen oxides per megawatt-hour of electricity Existing diesel generator / 25 to 30 Diesel generator wiht latest pollution controls / 7 Uncontrolled gas-fired power plant / 2 to 4 Controlled older gas-fired power plant / 0.1-0.15 New combined cycle gas-fired power plant / 0.05 Cancer causing particulates (PM) Power source / Pounds of PM per megawatt-hour of electricity Existing diesel generator / 1 to 3 Diesel generator wiht latest pollution controls / 0.1 to 0.5 Gas-fired power plant / 0.03 to 0.07 Snapshot of generators Number of emergency diesel generators in selected air districst: Bay Area Air quality Management District Generators: 3000 to 5000 Sacramento Metropolitan Air Quality Management District Generators: 641 San Joaquin Valley Air Pollution Control District Generators: 1200 South Coast Air Quality Management District Generators: 5000 Sources: California Air Resources Board regional air quality districts LOAD-DATE: April 30 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 McClatchy Newspapers Inc. Bee ??????????????????April 29 2001 Sunday METRO FINAL EDITION SECTION: MAIN NEWS Pg. A1 LENGTH: 1544 words HEADLINE: Why Edison PG&E split on strategy BYLINE: Dale Kasler Bee Staff Writer BODY: ??One utility was more entrepreneurial accustomed to the rough-and-tumble of free markets - and apparently believed only a radical remedy would cure its ills. ??The other was a more political animal conversant with the language of Sacramento - and confident that negotiations and compromise with state officials could fix its problems. ??Different cultures and different circumstances sent Southern California Edison and Pacific Gas and Electric Co. on separate paths this month. Edison run by a former president of the Public Utilities Commission negotiated a rescue package with Gov. Gray Davis. PG&E with fewer ties to government and possessed of an independent streak walked away from Davis and straight into U.S. Bankruptcy Court. ??As California's energy crisis hurtles toward a summer of blackouts and higher rates experts are debating which company found the best solution for digging its way out of billions in debt. ??We now have two models it'll be interesting to see who recovers the quickest said Mitch Wilk a former PUC president who is now an energy consultant in San Francisco. ??At first blush Edison and PG&E had plenty in common. Both utilities were afflicted with the same problem: runaway wholesale electricity costs they weren't able to recover from customers because of a state-mandated rate freeze. Both had been teetering on the edge of bankruptcy since January when their losses depleted their cash reserves and credit. ??But PG&E was far sicker financially than Edison. Its debts from the state's flawed deregulation scheme reached $6.6 billion vs. $3.5 billion for Edison. That's because Edison serves a smaller territory and has more long-term supply contracts so it was buying far less electricity than PG&E on the horrendously expensive spot market. ??Faced with a comparatively manageable loss Edison was receptive to selling its share of California's transmission grid to the state a deal that would generate $2.76 billion. The proceeds along with funds from a proposed long-term bond sale would pay off Edison's debts according to the terms of the deal. ??Although PG&E says it was willing to sell its transmission lines too there was a crucial difference in the two companies' backgrounds that ultimately would influence their approach to the financial crisis. ??Unlike Edison PG&E is a natural gas company as well as an electric company. PG&E a subsidiary of PG&E Corp. had survived the bruising wars of natural gas deregulation in the late 1980s and early 1990s. The experience took PG&E out of the cozy world of the regulated monopoly - in which the utility had exclusive rights to its service territory but was subject to state price controls - and into the world of competition. ??The experience gave PG&E more of a free-market bent said a former PUC staffer who requested anonymity. ??So even though Davis' aides say the governor offered PG&E a plan that would have paid off its debts - including $3 billion to $4 billion for its share of the grid - the utility balked at a key provision. While the original deregulation called for the cap on customer prices to end in 2002 Davis was insisting the utility remain regulated for a decade. ??PG&E wanted an immediate end to Public Utilities Commission regulation and would agree only to a cursory review of rates through a jury-rigged arbitration Davis said last week. ??I believe PG&E was in denial Davis said in an interview with Bee editors and reporters. ??PG&E says it wasn't demanding an end to regulation. Rather what it wanted - and what Davis' negotiator Michael Peevey agreed to in principle - was to let the utility charge ratepayers for all its costs of buying wholesale electricity said PG&E spokesman Ron Low. ??In that same deal reached Feb. 25 in Los Angeles PG&E made a handshake agreement to sell its transmission grid Low said. He wouldn't reveal the price. ??In the weeks that followed the governor's team reneged Low said. The discussions and negotiations broke down because they would not agree to the basic principles that were reached by (PG&E Chairman) Bob Glynn and Michael Peevey Low said. ??PG&E also became disgusted with a series of PUC rulings in late March and early April that it believed would seriously hinder its ability to recover its debts. ??Things came to a head April 5 when Davis proposed a rate increase and outlined his rescue plan in a televised address. A few minutes later Joseph Fichera a Wall Street financier advising Davis and other Davis advisers held a conference call in which they fleshed out the details for investors. Edison officials and directors listened in but PG&E didn't Fichera said. ??They had made up their minds Fichera said referring to PG&E officials. ??The next morning with Glynn dismissing Davis' speech as a lot of words the utility filed for bankruptcy protection. ??That afternoon Davis called PG&E selfish and pointedly went into a negotiating session with John Bryson the chairman and chief executive of Edison's parent Edison International. ??For Davis the meeting was crucial. Although Edison had tentatively agreed in February to sell its transmission lines the deal wasn't sewn up and Davis was nervous the PG&E bankruptcy would prompt Edison's creditors to jerk Edison into bankruptcy Davis said last week. ??That afternoon conceptually we reached an agreement Davis said. The deal was announced the following Monday. ??Consumer advocates and some legislative leaders blasted the agreement as a giveaway and said Davis hastily sweetened the terms for Edison because he needed to show progress on the energy crisis in the wake of the PG&E imbroglio. ??Not true Davis said the basic terms were already on the table before PG&E filed for bankruptcy. Either way Edison was receptive to negotiating with Davis. ??Edison's background is different from PG&E's. Because it isn't in the natural gas business it doesn't have the track record PG&E does with free markets. It is more comfortable in the regulatory and political realm experts say. ??Notably Bryson was president of the PUC in the 1970s - when Davis was Gov. Jerry Brown's chief of staff. ??He knows Gray Davis said ex-PUC President Wilk. He may feel a higher level of comfort in dealing with a very adversarial process. He felt he could rely on the governor. ??Politically savvy Edison is one of the utility industry's biggest contributors to national political campaigns and it usually spends more than PG&E on California campaigns. Edison International's board of directors includes Los Angeles attorney Warren Christopher the former U.S. secretary of state and an elder statesman of the Democratic Party. ??Though it's open to negotiations Edison isn't a pussycat. To the contrary experts say. ??It was usually Edison that was more combative than PG&E said Tom Willoughby a retired PG&E lobbyist. ??Wilk agreed adding: I find it curious that PG&E's being painted as the confrontational aggressive company and Edison as the get-along company. ??Edison hasn't been shy about going to Sacramento for favors last year for example Edison wanted some changes made in the operation of the state's power grid. Instead of talking to the grid manager the Independent System Operator Edison went to the Legislature a source said. Lawmakers then pressured the ISO to make the changes. ??One more factor may have played into Edison's willingness to deal with the governor. ??Last year it became involved in a protracted dispute with the Federal Energy Regulatory Commission which oversees the transmission grid over how much profit Edison could earn from the grid. ??Edison eventually won its point but the case influenced the utility's thinking when Davis offered to buy the grid. According to industry consultant Barbara Barkovich Edison figured why wrestle with the federal government over profits when it simply could raise billions through a cash sale? ??Besides Edison has a back-up plan if the Legislature scraps the grid purchase as many lawmakers have threatened. The company has said it would follow PG&E's lead and file for bankruptcy. ??But its willingness to negotiate with the governor will have served it well even if it goes into bankruptcy said Nancy Day a utility industry veteran consulting for the Legislature. ??Day said she believes the governor's appointees on the PUC will punish PG&E for its behavior. If Edison winds up in bankruptcy court it won't be punished for it Day said. ??PUC President Loretta Lynch couldn't be reached for comment. ??Energy companies at a glance Edison Main subsidiary: Southern California Edison Headquarters: Rosemead Los Angeles County Customers: 4.2 million in Southern California Chairman: John Bryson Performance: Lost $1.94 billion in 2000 on revenue of $11.72 billion Stock ticker symbol: EIX ??PG&E Main subsidiary: Pacific Gas and Electric Co. Headquarters: San Francisco Customers: 13 million in Northern Central California Chairman: Robert Glynn Jr. Performance: Lost $3.36 billion in 2000 on revenue of $26.23 billion. Stock ticker symbol: PCG ??* * * ??The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.com. GRAPHIC: Bryson Glynn LOAD-DATE: April 30 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 McClatchy Newspapers Inc. Bee ??????????????????April 29 2001 Sunday METRO FINAL EDITION SECTION: MAIN NEWS Pg. A3 LENGTH: 679 words HEADLINE: What will be fallout from California's energy meltdown? BYLINE: Dan Walters BODY: ??No one knows for certain how - or when - California's energy crisis will conclude. It is an inordinately complicated four-dimensional chess game that has so far defied politicians' simplistic - perhaps simple-minded - efforts at resolution. ??That said one may speculate reasonably on the financial social and political consequences for California in the months and years ahead. ??Financially Californians - especially the 70 percent who are served by private electric utilities - will feel the pinch for years if not decades to come. Before the crisis hit California's power rates were already among the highest in the nation. Given the nearly $20 billion in power purchase debts that the utilities and the state have accumulated so far the stubbornly high wholesale prices and other data it's not unreasonable to project that Californians in private utility areas will see their rates double or rise even higher. ??Politicians have been laying the rhetorical groundwork for big increases although they've been disingenuous about the outer parameters. The burden will fall most heavily on business customers and coupled with doubts about power reliability and rising natural gas prices will damage the state's ability to attract job-creating investment. States with low and stable energy prices already are using the crisis as a recruiting tool. In February Intel President Craig Barrett told the Wall Street Journal: As long as California is a Third World country we won't build $2 billion manufacturing plants here. ??The inevitable escalation of utility rates will create distortions within the state as well since utility rates for the 30 percent of Californians served by publicly owned utilities are not likely to rise by more than token amounts. The municipal utilities' rates were roughly a third lower than private utilities' rates prior to the crisis. By the time the dust settles they may be just half as much. It will contribute to the balkanization of California that was already being defined by such factors as housing prices ethnicity and income levels. Low-cost regions will become magnets for people and jobs while high-price regions will be shunned. ??The energy crisis will certainly be the defining issue of the 2002 elections and perhaps for others to follow. Gov. Gray Davis' popularity has plummeted since he took charge of the crisis laying waste to his intentions to seek an easy re-election next year as a middle-of-the-road business-friendly tough-on-crime education reformer. ??With his popularity waning Davis may be compelled to turn left shoring up his base by catering to demands of labor unions environmentalists trial lawyers and other liberal elements of the Democratic Party. That in turn would undermine the triangulating strategy he has pursued in which he took Democratic voters for granted and cultivated business executives and social conservatives. Business interests are worried for example that Davis may now feel compelled to sign union-friendly legislation such as boosts in workers' compensation and unemployment benefits that he vetoed in the past. ??Davis' relations with fellow Democrats in the Legislature have turned from cool to poisonous with lawmakers openly trashing his leadership and management of the energy crisis and worrying that he'll try to shift the blame to them if the crisis turns to disaster. If Democratic leaders fear that voters will be in a throw-the-bums-out mood next year they may throttle back on intentions to maximize their party strength in drawing new legislative districts. Such maximization would require spreading Democratic voters out among many districts and such margin-thinning could make Democrats vulnerable in an energy crisis-spawned voter rebellion. Democrats may well strive for fewer but safer seats. ??These are but a few of the potential effects that California will experience long after the immediate crisis has faded whenever that may be. ??* * * ??The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.com. LOAD-DATE: April 30 2001 of 103 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????APRIL 29 2001 SUNDAY FINAL EDITION SECTION: INSIGHT Pg. D1 LENGTH: 1419 words HEADLINE: The energy crisis is good for you SOURCE: Insight Senior Writer BYLINE: Louis Freedberg BODY: Here's a message for pampered and overindulged citizens of the Golden State who complain unceasingly about high energy bills and the day-to-day prospect of rolling blackouts: Stop whining. ???It's not a crisis -- it's an opportunity. The energy crisis is good for us. ???For decades we burned lights whenever we wanted bought more and more energy-guzzling appliances bigger and bigger television sets. Today as citizens of the richest state in the world's only superpower who is going to tell us when to stop? ???We talk about having to hit mules over the head with a 2 by 4 to get their attention but I don't think human beings are much more responsive or foresighted. I hate to see people suffering but on the other hand if that is the way we learn so be it says Ernest Callenbach the Berkeley author of the futuristic 1975 novel Ecotopia. Callenbach's work was a major influence on the alternative energy policies of former Gov. Jerry Brown. ???Nowhere has the ethic of unlimited consumption been more out of control than in the Bay Area where the energy demands of high tech outstripped what the electricity grid could supply. Aside from the energy needs of the industry itself the wealth it generated encouraged avaricious lifestyles that include power-swilling mansions and freeways clogged with monster sport utility vehicles. ???Perhaps the 34 days of blackouts some experts predict for this summer will bring the discipline that eludes us. Except for the hardships the crisis has inflicted on the poor Californians still enjoy a sybaritic lifestyle that in ways would put to shame the pharaohs of Egypt or the court of Louis XIV. Lights still burn when they're not needed. Except for very occasional blackouts electricity still flows 24 hours a day. Our daily routines have barely been affected. A visitor from another state or country would have a hard time finding signs of our highly publicized crisis. ???As we brace for deregulated electric bills courtesy of the state Public Utilities Commission imagine what life was like for Native Americans who lived for millennia in a bounteous Bay Area without microwaves waffle irons air conditioning or 24-cubic-foot refrigerators. No one is suggesting that we revert to those days. But let's consider the thought that we may actually be better off without the piles of appliances whose tangle of cords clogs our homes and offices. ???Smug Californians love to point to the state's ranking as a miserly consumer of energy -- only three other states consume less per capita -- to rebut accusations that we have become greedy energy hogs. Tougher efficiency standards have helped but so has our great weather. California has a uniquely good climate to be efficient says Dan Kammen director of the Renewable and Appropriate Energy Laboratory at the University of California at Berkeley. Compared to countries with much harsher climates we have not done enough. ???There's no denying the sudden sharp pain caused by the crisis -- from threats of sky-high electric bills to fears that California's economic engine is near collapse. But if we handle it right all kinds of positive energy will result. Potential benefits extend from the spiritual (a revival of the conservation ethic) to the curative (making the state immune to power-problem overloads) to the liberating (throwing off for good our dependence on the Texas energy overlords). ???Consumers shocked into action by tripled or quadrupled energy bills are already rushing to Bay Area hardware stores snapping up setback thermostats hot water heater blankets insulating window film and outdoor clotheslines. Alan Ginsberg of Satco Products in Hayward who imports from China container-loads of squiggly shaped energy-saving fluorescent bulbs says They're flying out the door. ???More significantly the crisis impels the state to move ahead with the construction of badly needed power plants. It puts on the agenda of public debate the fundamental question of whether our energy system should be in the hands of giant utilities or run by municipalities or by the state. It certainly unveiled the greed of out-of-state energy producers who have sucked billions of dollars from California. ???The crisis has also made us focus on fundamental flaws in our energy grid such as the 4500-megawatt electricity shortage that emerged in the 1990s while we were all reveling in California's boom times. ???By exposing those who got us into this predicament -- producers utilities regulators and politicians -- there's a chance we'll get out of it with a more rational and efficient energy grid and be better prepared to deal with challenges down the road. If that happens Gov. Gray Davis might yet confound critics who say his political prospects are sinking faster than you can say megawatt. ???The ease and convenience of modern life fools us into thinking that power water and food are infinite. Flip a switch and the lights magically go on. Turn a faucet and water flows. These days the biggest challenge in gathering our daily bread is the hunt for a space in the supermarket parking lot. ???And we want it all leading us straight into denial. We want instant abundant power -- but we don't want any new power plants especially in our backyards. Coal is dirty. Natural gas is expensive. Dams kill salmon. Nuclear power? Forget about it. The contradictions haven't mattered -- so long as an endless supply of electrons flowed from our wall outlets. But that mindless ease the crisis taught us is history. ???The energy crisis warns us that we must become more self-sufficient or risk slipping toward oblivion if we continue to spend billions of dollars on shrinking non-renewable energy sources such as coal and natural gas. ???The Roman Empire fell because of the decadence of its ruling elites. And the British empire dependent on raw materials from the colonies began to collapse when it became too expensive to import goods across oceans. ???A new consciousness about where electricity comes from is the first step toward using less of it. It could also translate into a greater awareness of other environmental causes. ???If we get the message the net outcome (of the energy crisis) will be a quite profound shift in consciousness in energy conservation predicts Michael Lerner executive director of Commonweal a health and environmental institute in Bolinas. ???Such a turnaround is no snap. ???During the last energy crisis in the 1970s there was a similar rush toward conservation. President Jimmy Carter installed solar panels on the White House roof. President Ronald Reagan took them down. He also phased out tax credits and other inducements to encourage development of renewable energy sources. ???Closer to home one of former Gov. George Deukmejian's first acts was to abolish the Office of Appropriate Technology established by Gov. Jerry Brown to move us away from our dependence on non-renewable fossil fuels. ???Since then we have regressed further. Even record high gasoline prices have done nothing to depress the sales of SUVs which now account for the largest share of automobile and light truck sales (20 percent at last count). ???But today's crisis could lead to permanent changes in behavior if only because the technology needed to harness sun wind and other renewable energy sources has become far more cost effective than a generation ago. California already gets 12 percent of its energy from these alternative sources and the market incentives to develop them further has never been higher. ???Stratospherically high electricity bills could finally force on us the technological changes and the discipline that Europeans -- who use two-thirds as much energy per capita as we do -- and the Japanese -- who use only half as much -- have had to embrace. ???This difficult moment in California's history has already yielded some ecological epiphanies like those experienced by Ernest Callenbach's neighbors. They installed solar photovoltaic cells on their roof. The installation now puts surplus electricity back into the energy grid instead of sucking more out of it. ???The magical moment is the idea that by having a photovoltaic cell on your roof you can make your electric meter run backward said Callenbach. Instead of it going to the right you actually see it going in the other direction. You say to yourself 'Oh Lord Oh Lord I have seen the future.' ??Email Louis Freedberg at lfreedberg@sfchronicle.com GRAPHIC: GRAPHIC Don McCartney/The Chronicle LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 Ventura County Star County Star 29 2001 Sunday SECTION: Editorials Pg. B09 LENGTH: 704 words HEADLINE: Reality is what's needed for real policy GOVERNOR: Consumers deserve to get real facts from Davis. BYLINE: Dan Walters BODY: ??Gov. Gray Davis is continuing to tell Californians that he's on top of the state's energy crisis and as he said at one gathering last week in three years this problem will be a distant memory. Fat chance. All major aspects of the situation are growing worse not better minute-by-minute. ??Politicians took over the crisis in January as the state's major utilities exhausted their cash reserves and lines of credit. Davis began what he said then would be a short-term emergency program of power purchases to keep electrons flowing into homes and businesses. ??From that moment forward the situation has steadily deteriorated moving toward a three-pronged disaster: severe summer blackouts the bankruptcy of the utilities and sharply escalating power bills. With the bankruptcy filing by Pacific Gas & Electric Co. and decisions by Davis and the Public Utilities Commission to begin ratcheting up utility rates two of the three negative scenarios are now in place. And everyone involved in the crisis expects blackouts this summer as demands for power soar and supplies dwindle. ??The Davis strategy if there is one is to continue the state's massive power purchases while negotiating longer-term and presumably cheaper supply contracts encourage conservation help utilities pay off their debts by selling their intercity transmission system to the state and tapping ratepayers and build more power plants to ease the supply crunch. ??Currently the governor is touting his deal with Edison International parent company of Southern California Edison to sell its portion of the grid and is working on a similar deal with Sempra the parent of San Diego Gas and Electric. But PG&E's bankruptcy casts doubt on the viability of the cash-for-grid concept and legislators particularly Davis' fellow Democrats are very skeptical of the Edison deal. ??Clearly Davis rushed into the Edison deal just three days after PG&E filed bankruptcy in hopes of erasing the political stain of the latter action but its provisions are being labeled a bailout by critics. It places only a token financial burden on Edison International while guaranteeing the profitability of its utility subsidiary by charging its customers whatever is required to cover its costs and past debts. ??Meanwhile the state is spending -- by Davis' own account -- about $70 million a day or $2-plus billion a month on spot power purchases paying roughly five times what consumers are being charged at the retail level. And the current futures market for power indicates that wholesale power prices will jump by another 50 percent by mid-summer higher prices and greater purchases could increase the drain on the state treasury to as much as $5 billion a month. ??State Treasurer Phil Angelides is desperately trying to arrange a bridge loan to relieve pressure on the state's rapidly vanishing reserves but Wall Street is reluctant to lend without a fuller explanation of what's happening and a specific authorization from a suspicious Legislature. ??He said Tuesday that Davis who has maintained secrecy on power purchases must offer a comprehensive and public plan for dealing with the financial squeeze. ??Meanwhile bankers are sending strong signals that the state government is becoming as poor a lending risk as the utilities. ??Davis for some reason is unwilling to declare this situation the emergency that it is truly becoming -- one that could take a toll of human life if major blackouts shut down air conditioners respirators and traffic lights. He insists on issuing his periodic -- and wholly unrealistic -- assurances that things will turn out all right even declaring to reporters this past Tuesday that we think we'll have this thing licked by the end of fall. ??It's time for someone -- the governor preferably but someone -- to lay out for Californians exactly what's happening the downside financial and power supply risks and what's being done to deal with the looming disaster facing this state. ??It's time for politicians to treat us as adults who can face reality not as children to be fed sugarcoated sound bites and slogans. ??-- Dan Walters writes for the Sacramento Bee. LOAD-DATE: April 29 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 28 2001 Saturday Home Edition SECTION: Part A Part 1 Page 19 Metro Desk LENGTH: 679 words HEADLINE: OFFICIALS CALL PRICE STABILITY PLAN ILLEGAL UTILITIES: AGENCY CHIEFS SAY THE FEDERAL PROPOSAL COULD ALSO CAUSE MORE BLACKOUTS THIS SUMMER. BYLINE: NANCY VOGEL and MIGUEL BUSTILLO TIMES STAFF WRITERS DATELINE: SACRAMENTO BODY: ??Two top state energy officials said Friday that a federal plan to stabilize electricity prices in California could increase the odds of blackouts this summer and most likely is illegal. ??In a barrage of complaints attacking the Federal Energy Regulatory Commission the state's top power regulator and the head of the board overseeing California's transmission grid said they might challenge the federal order in court. ??The order was approved on a 2-1 vote Wednesday and released to the public late Thursday. ??We're going to take whatever actions we can to oppose this to the extent our lawyers tell us it's illegal said Michael Kahn an attorney named by Gov. Gray Davis to head the board overseeing the California Independent System Operator. Cal-ISO manages the transmission grid reaching three-quarters of the state. ??In a conference call with reporters Kahn and Loretta Lynch president of the California Public Utilities Commission said the order also seems to indicate that FERC is unwilling to force power sellers to rebate any of the extraordinary profits earned before last October in California's market where wholesale electricity prices began soaring last May. ??And according to Kahn the federal order illegally ties limits on power prices to a requirement that California link its transmission grid with those of other states. ??It's not within their authority to have this kind of linkage he said. ??The federal order is scheduled to take effect May 29. Though it is not clear how the order will play out in the state's electricity market Lynch and Kahn said they do not believe it will bring down power costs or help the state avoid blackouts as intended. ??They're creating a whole new wholesale blackout system said Lynch referring to a section of the order that allows large customers such as steel mills and food processors to get paid to shut down when grid operators are struggling to find enough electricity to meet demand. ??Though a somewhat similar program has helped California avoid blackouts the federal order requires state power buyers to name the price to which electricity must rise before they shut down customers. ??The requirement of naming a price could lead to more blackouts said Stanford University economist Frank Wolak because it prevents power buyers from paying more if that's what it takes to keep electricity flowing. ??Stating your price and sticking to it means that somebody could call your bluff Wolak said. The generators just say look we can't supply all you want at the price you want to pay. ??So they supply everything they can at the price we're willing to pay--and no more--and we have rotating blackouts he said. ??Lynch said that no matter how this aspect of the FERC order unfolds it ain't for Washington bureaucrats to decide when the lights go out in California. ??Grid operators at Cal-ISO must quickly buy batches of electricity to constantly match supply and demand on the transmission system serving most of the state excluding the city of Los Angeles. When Cal-ISO cannot find enough power it must order Southern California Edison Pacific Gas & Electric and San Diego Gas & Electric to trigger rotating blackouts. ??The state suffered such controlled outages on four days in January and March and many such days are predicted for this summer as air conditioning drives up demand for power. ??In other energy news Friday Gov. Gray Davis announced in Los Angeles that electricity use in California state office buildings dropped by an average of 20% in the first two months of this year compared to the same months of 2000. State workers have been under orders since late last year to turn off nonessential lights computers printers and other electrical appliances. Some agencies have even changed workers' schedules eliminating flextime so that everyone works the same hours and the offices can open later and close earlier shortening the energy-using day. ??* ??Times staff writer Mitchell Landsberg in Los Angeles contributed to this story. LOAD-DATE: April 28 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 28 2001 Saturday Home Edition SECTION: Part A Part 1 Page 19 Metro Desk LENGTH: 688 words HEADLINE: BILL COULD FOIL DAVIS' ELECTRICITY OFFENSIVE POWER: CONGRESSMAN WANTS TO LET SMALL PRODUCERS SELL ON WHOLESALE MARKET. BACKERS SAY PLAN WOULD BOOST SUPPLY BUT FOES SEE IT COSTING CALIFORNIA DEARLY. BYLINE: JULIE TAMAKI and MIGUEL BUSTILLO TIMES STAFF WRITERS DATELINE: SACRAMENTO BODY: ??A Texas congressman plans to introduce legislation next week that would allow California's small power producers to sell their supplies on the wholesale market--a move that could threaten Gov. Gray Davis' plan to end the state's energy crisis. ??The proposal by Republican Rep. Joe Barton the influential chairman of the House energy and air quality subcommittee would permit producers of alternative and renewable energy to suspend their contracts with the state's two biggest investor-owned utilities and sell their supplies to a third party. ??Proponents say the bill could dramatically bolster the state's electricity supplies by luring producers whose plants have been shut down by payment disputes to restart them in time for summer when supplies are expected to be tight and blackouts are feared. ??But allowing producers to sell to a third party would essentially devastate Davis' plan to rescue the utilities and get the state out of the business of making emergency electricity purchases. ??The governor's plan is based on California locking down the costs of electricity from the utilities and small power producers for several years at a reduced cost. ??During that time the state would buy the remaining portion of the electricity the utilities need to serve their customers. Meanwhile the utilities would regain their financial footing by selling assets to the state in exchange for being allowed to recover a portion of their back debt through a surcharge on electricity bills. ??If the alternative producers were allowed to sell their power on the wholesale market the state could be forced to purchase much more electricity on the expensive open market. ??That would dramatically increase California's already massive power costs forcing the state to further raise electricity rates and borrow even more than the record $ 12 billion in bonds it is planning to finance the plan. The state has spent more than $ 5 billion buying electricity that the utilities cannot afford and Davis expects to spend $ 15 billion by year's end. ??It is a way of busting the budget for the state of California said Joseph Fichera a Wall Street energy consultant hired by the Davis administration. He called the potential release of the small producers a disaster scenario for the state. ??Added Stephen E. Frank chairman president and chief executive of Southern California Edison: Releasing them from their contractual obligations will simply exacerbate the problem because they would then be selling into the market at additionally higher rates and just compound the state's problems. ??But Eugene Peters of the Electric Power Supply Assn. disputed that contention. The state he said is already buying replacement supplies on the open market because of reduced output by small producers. ??If 3000 megawatts are made available again it will have a potentially profound effect on what people pay for power by bolstering overall electricity supplies Peters said. ??Utility executives contend that only 1200 megawatts are offline because of payment problems. ??California is home to nearly 700 small energy producers which generate more than a quarter of the electricity consumed in the state. They differ from their big out-of-state counterparts which have been getting paid by the state. ??The Barton proposal will be the subject of public hearings Tuesday and Thursday and could move to the full House Energy and Commerce Committee for a vote the next week. Barton could not be reached for comment Friday. ??The alternative-energy provision is one of several in his emergency energy bill. Others designed to help the West through a difficult summer of price spikes and energy shortages range from offering federal aid to relieving a bottleneck in the transmission system to permitting governors to secure waivers from environmental rules to boost power supplies. ??The provisions dealing with waivers of environmental rules have been among the most controversial drawing opposition from environmentalists. ??* ??Times staff writer Richard Simon in Washington contributed to this story. LOAD-DATE: April 28 2001 of 103 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 28 2001 Saturday Home Edition SECTION: Business Part C Page 2 Financial Desk LENGTH: 137 words HEADLINE: BRIEFLY / ENERGY PUC ORDERS UTILITIES TO POST BLACKOUT DATA BYLINE: Nancy Rivera Brooks BODY: ??Responding to customer complaints the California Public Utilities Commission ordered Southern California Edison and San Diego Gas & Electric to tell customers more about when they will be blacked out during times of extreme power shortages. The PUC told Edison and SDG&E to begin listing on electricity bills by June 1 the outage block into which each customer falls. ?The utilities then must use their Web sites to tell customers which blocks are slated for blackouts should more rotating outages be required. Pacific Gas & Electric Co. already lists outage block numbers on its customer bills. A pop-up box on PG&E's Web site shows which blocks are next in line for blackouts. Edison and SDG&E said they have been working on implementing such notification on their own and will comply with the PUC ruling. LOAD-DATE: April 28 2001 of 103 DOCUMENTS ??????????????????Copyright 2001 McClatchy Newspapers Inc. Bee ?????????????????April 28 2001 Saturday METRO FINAL EDITION SECTION: MAIN NEWS Pg. A3 POWER CRUNCH LENGTH: 1109 words HEADLINE: Cities take new look at public power The state's uncertain electricity picture has local officials deciding it's time to revisit the idea of municipal utilities. BYLINE: Carrie Peyton Bee Staff Writer BODY: ??From the shipwreck of California's electric industry Albert Vera sees a chance to build a life raft. ??This is an opportunity that shall never come again the former Culver City mayor told city and county officials gathered this week in Sacramento. ??Every rate hike every blackout every corporate bonus is more evidence for believers that it's time for local government to get into the power business. They pin their hopes on municipal utility drives in San Francisco Corona San Diego County and beyond. ??Over the past few years however only a handful of cities have set up their own electric departments and they are mostly limited entities that fall short of full-fledged utilities. More commonly cities - including Davis Lincoln and Culver City - have studied the idea and rejected it at least temporarily. ??They all face the same question said Santa Rosa City Manager Jeffrey Kolin: ??Is the investment worth the risk? Most of us would say we don't know yet. ??Kolin's city like scores of others across the state has decided it is time to study the issue anew motivated by the prospect of soaring electric bills repeated blackouts and Pacific Gas and Electric Co.'s bankruptcy filing. ??All their citizens are screaming said Yvonne Hunter a lobbyist for the League of California Cities. ??The highest visibility fight will likely come in November when San Franciscans go to the polls to decided whether to create their own utility in a city that houses PG&E's corporate headquarters. ??We will take it very seriously PG&E spokesman John Nelson said. ??Shortly after deregulation in 1996 several drives for ratepayer-owned utilities stumbled or stalled. An effort in the far north state to create a multicounty public power agency was rejected by state regulators because some local governments objected. ??Now with a bill to create a state power authority moving through the Legislature some believe the climate may be changing. ??One of the things this crisis has proved is the value of local control said Jerry Jordan head of the California Municipal Utilities Association. ??Since January the cities of Hercules in the Bay Area and Corona in Southern California have formed utilities to deliver electric service to new neighborhoods - a strategy that sidesteps potential condemnation fights with the existing utility. The county of San Diego is trying to get special legislative authority to create a regional power agency without a popular vote. ??We could produce power better cheaper and faster than the private sector county Supervisor Dianne Jacob said. ??Not so say PG&E and Southern California Edison. ??There's been much more talk of it but as soon as most folks sit down and take a look at the realities ... they realize that they would have to buy on the same market at the same outrageous prices that we and the state have been paying Nelson said. The talk quickly evaporates. ??For-profit utilities have long argued that government shouldn't usurp the role of private industry in delivering electricity. PG&E contends that the factors that once made public power attractive - such as access to low-cost electricity from federal dams - have evaporated. ??In addition cities that try to withdraw from PG&E or Edison now probably would still have to funnel money their way for years to come to pay off still-unsold state bonds that will stretch out a single year's power costs for up to 15 years. ??With so many unknowns the next few years are likelier to produce more studies than new utilities said a number of city officials who attended a seminar in Sacramento this week sponsored in part by the American Public Power Association. ??Former New York state Sen. Al Coppola told the group the session should have been titled: Independence from the greedy robber baron utilities. ??Public power backers share three key beliefs: ??* They can charge customers less because they don't have to pay dividends to investors or pay taxes on their sales they can respond to local preferences on issues like which customers pay the lowest rates and how blackouts are staged and existing utilities will do everything in their power to oppose them. ??Edison did the right thing - (use) fear to discourage Culver City from creating an electric arm in 1995 Vera the city's former mayor told the group. ??And Glenn Prentice head of the newly created Corona electric utility said in an interview that a half-dozen other cities have contacted him for more information but he declined to name them. ??If I do Edison will start the attack on them. We're talking about a lot of money he said. We're here to serve the public. They're here to make money. ??PG&E sees new utilities as competition for our business and it has a policy of lobbying hard against them Nelson said. ??Less than 18 months ago it warned residents of the Placer County town of Lincoln that a city power enterprise would be costlier and less dependable than PG&E and its officials labeled the effort a tax dodge. ??But by January of this year PG&E barely blinked when Hercules set up a utility to deliver power and telecommunications service in new neighborhoods. ??We got more resistance from AT&T and PacBell said Raj Pankhania assistant to the city manager of Hercules. ??Pankhania has been researching utility drives across the state and has seen no groundswell for public power although he believes it can bring cities added revenue and more local control. ??That could change this summer Prentice said. ??It really depends on how bad the blackouts are. ??A blackout that left one city councilmember's daughter at a darkened school was part of what led the Riverside County city of Corona to vote April 4 to form its own electric arm he said. Heavy industry became anxious too. ??They said to the city council 'Do something!' Prentice said. ??Skipping detailed studies Corona quickly decided to create a utility that will build small power plants under 50 megawatts to serve city operations and new neighborhoods in the city of 127000 east of Disneyland. ??In time said Hercules' Pankhania cities like his could become the living laboratory for whichever system can deliver better service and lower rates. ??Hercules' plans calls for the older two-thirds of its homes and businesses to retain their PG&E service and the newest third to be served by the city utility. ??The existing homeowner will definitely compare five to 10 years down the road he said. Then let the people decide which way they want to go. ??* * * ??The Bee's Carrie Peyton can be reached at (916) 321-1086 or cpeyton@sacbee.com. LOAD-DATE: April 29 2001 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FYI From Marty Sunde: Request for Ken to contact Chancellor Reed, California State University System Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: 2002 Budgets - Here we go! with attachment Body:: Will you be filling out mine? From: Elizabeth Linnell on 06/12/2001 12:53 PM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Aleck Dadson/TOR/ECT@ECT Michael Terraso/OTS/Enron@ENRON Marc Phillips/OTS/Enron@ENRON Henry Jeffrey Keeler/Corp/Enron@ENRON Susan Mark Palmer/Corp/Enron@ENRON Dennis Kelly Kimberly@Enron Communications Christie Patrick/HOU/ECT@ECT John cc: Subject: 2002 Budgets - Here we go! with attachment Sorry! What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Eeegads... Body:: Don't know how I got on the list but just got my invitation to the Western Conference of PUCs meeting June 3-6 where the guest speakers are Frank Wolak and Gary Locke. Oh dear.... Best Jeff What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EES Organizational Announcement Body:: Congratulations! ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Memo Re State Processes for Takeover of Transmission Body:: nan What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Task Force conf call -- 9:30 Body:: 202-287-1321 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Public Policy Contacts for California Body:: Jeff and Steve As you requested I have prepared a list of my preferred public policy contacts for California. It is composed of professionals from an array of public private and non-profit backgrounds. I have worked in some capacity with each of these people and most I know quite well. Please call me for further background. Kevin 213-926-2626 Attachment - Kevin Scott - Preferred Contacts - 6-20-01.doc What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Daily Research reports Body:: I would like to see research from all of these sources on areas of interest to enron -- energy and broadband North America and Europe. Thanks Henry Emery on 07/19/2001 12:03:17 PM To: undisclosed-recipients: cc: Subject: Daily Research reports Attached are two research reports that I can send to you on a daily basis. One of our many benefits here at our new location is the availability of various research sources. The two reports I have attached are from : The First Union Securities Equity Marketing Group and Merrill Lynch We also have access to Goldman Sachs research and CS First Boston Research. Please let me know if you would like me to continue sending these reports on a daily basis or if you have any particular companies that you are interested in hearing about. Sincerely Hank Emery - Spotlight071801.pdf.pdf - smith.pdf.pdf What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Draft New Power press release Body:: In the second paragraph we should delete the partnership statement. I think it's more effective to refer to the New Power Company's risk management capabilities (as provided by Enron if necessary). That's the basis for the ability to guarantee savings (not economies of scale). I am also concerned that the current statement implies that Enron is taking the risk on the commodity price guarantees. Peggy Mahoney@EES 08/24/2000 01:15 PM To: Mark Koenig/Corp/Enron@ENRON Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Cedric Burgher/Corp/Enron@ENRON Paula Rieker/Corp/Enron@ENRON Mike Kerns/Western Region/The Bentley Company@Exchange Karen Denne/Corp/Enron@ENRON Karen S Owens@ees@EES Elizabeth Tilney/HOU/EES@EES cc: Subject: Draft New Power press release See draft release below. I have made some suggestions. Let me know what you think by Friday at 10:00am. Peggy ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Invitation to address UTILITIES 2001 Body:: Decline is ok. Enron Capital & Trade Resources Corp. From: Sherri Sera 05/09/2001 11:04 AM To: Ursula Brenner/NA/Enron@Enron cc: Steven J Kean/NA/Enron@Enron Subject: Re: Invitation to address UTILITIES 2001 I had originally declined this invitation but decided to run it by you after closer review. He could be there if he chooses to and if you think he should. Please advise. SRS ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Joe Hirko Fortune interview Body:: Looks good. Some of his questions suggest he's going to include a fair amount of industry reaction -- which could be a mixed bag some are clearly threatened by efficiencies in bw markets. Looks like it will be a really good story. He definitely appears to be excited by it. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Advisory council meeting Body:: See last question. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Antitrust meeting with Rick, Lara, and Vicki Sharp, in teamroom. Body:: Cynthia -- regulator to speak on same day as Shaheen Tom Delainey What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: More great press! Body:: Did you see Peggy Noonan's article? Shapiro and I are getting misty eyed. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Call to Bob Glynn Body:: Per our discussion this morning below is a summary of items to discuss with Glynn: Adding Enron's negative CTC claim to the list of claims: PGE's filing included a list of top twenty creditors. Our negative CTC claim was apparently not taken into account in compiling that list. The list is nonbinding however. PG&E will be required to file schedules of creditors on April 20. Our negative CTC claim should be on Schedule F (for unsecured claims). You may want to remind Glynn of your previous conversations and state our expectation that the negative CTC claim will appear (preferably as uncontested) in the April 20 filing. (Note: if PG&E does not include the claim we have an opportunity to file a proof of claim and ultimately the court determines the validity of the claim). Including Enron on the Creditors' Committee: PG&E may have the opportunity to influence representation on the creditors' committees. There are several reasons to suggest to Glynn that we be included: 1) we are a big creditor 2) we could be helpful in crafting a broader solution and 3) we are one of the real parties in interest behind the PX and ISO (who were listed as significant creditors but are really just passthroughs for the suppliers ... and PG&E likely would not want to have those political bodies serving on the creditors committee anyway). What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meet with Choice Team team Diane, Mark, Luke, Vicki, Harry, Jane, Klauberg, Rick, Jim, Robin Ross, Jay Flaherty, Dan Clearfield, Amy Leader in 6C2 Body:: Call 800-998-2462 pin code #629012 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential Agreement Body:: Jerry: Here is the latest CA with everyone's changes. I feel that this is pretty close to the best we can offer in terms of the stand-still and non-solicitation agreements. Enron usually does not get into stand-still agreements so doing this one was a big step for Enron. Look forward to talking to you tomorrow morning. Thanks for your patience. Again this is a draft copy for discussions purposes only. Regards Ben What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: -- Joe and/or Rick Body:: Call Montano or Day Presentation to ECT presentation to MIT group Texas file cal file What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: More great press! Body:: I can hardly believe Peggy Noonan wrote this. I'm a sucker for blatant heart string pulling. I love it. I'm misty. ----------------- What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CPUC Request for Confidential Information Body:: I understand that we may have no choice in the matter but having wtinessed Loretta Lynch's inability to define market power when asked to do so by Joe Barton last Monday and having heard Carl Wood declare war on capitalism at FERC's hearing on Tuesday and knowing that the likes of Harvey Morse (PUC FERC attorney) who has never come down on the side of no market power here in any analysis is heading up the PUC investigation and seeing Gov Davis' press releases demanding refunds from the faceless out-of-state suppliers I'm well maybe a little nervous about them getting their paws on our data. Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Commodity Futures Act - Talking Points Body:: please print What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Compliance Agreement Body:: What's this about? Could you e-mail Dave and I with the background any effect on us etc.? Why was Dave on this distribution? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meet with Commissioner Ebert in Biloxi Body:: Fly to DC from Biloxi What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Department meeting conference call. 800-283-1805, in Ricks name. Body:: Gordon Weil Dave Marquart Richard Tabors What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Two Requests re: May 22-23 Forum Body:: I already responded to this. Print for my meeting file. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Background and Message Points Body:: Attached is Jeff's backgrounder in the event you call Hertzberg. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Most of West in the Same Power Jam as California Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CONFIDENTIAL - Residential in CA Body:: I get so worked up over this issue... I really think now is the time to speak up and dissent. Skilling told us at a floor meeting that as an organization we've made poor decisions in the past and he believes it's because the people who disagreed with those decisions never spoke up. So help me out! From: Jeff Dasovich on 04/13/2001 12:34 PM Sent by: Jeff Dasovich To: Karen Denne/Corp/Enron@ENRON cc: Subject: Re: CONFIDENTIAL - Residential in CA Amen. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Market Stack Body:: Eric July works for me. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Details - follow up (back) Body:: Thanks for handling. Let me know if it begins to interfere unduly with your new responsibilities. Mark Schroeder@ECT 04/12/2001 04:23 AM To: Mike cc: Jo Ann Hill/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Subject: Re: Details - follow up (back) Thanks. I am seeing a few things through to conclusion and I expect this situation to be one unless Steve prefers to handle it differently. I think it is a matter of either him or me and I think this is one item I can keep off of his plate. thanks mcs Mike Dahlke@ENRON_DEVELOPMENT 11/04/2001 14:41 To: Mark Schroeder/LON/ECT@ECT cc: Subject: Re: Details - follow up (back) Mark Congratulations on your new assignment. It has been a long time since I have dealt with Coal but the business desperately needed new ideas and approaches when I knew it. Good luck! Yes I did meet with JoAnn last Friday. As required by the agreement she gave me I have retained counsel and the proposal is being reviewed by my attorney. In light of the announced change I am wondering if questions and comments should still be addressed to you? Please advise. Mike D. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Gary von Fischer Body:: 10:45 meet with Cliff Baxter What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I still need to talk to you about our public message in India. I am on my way to Calgary tonight. My hotel number is 403-266-7331. Thanks. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential -Strategic Question Body:: Today's strong gas prices have opened a new window of opportunity for a pipeline to move Wyoming gas into the Ventura market and downstream. Currently Trailblazer is conducting an open season to expand its facilities for service between Wyoming and Gage County Nebraska. A number of our contacts in the Powder River (including ENA) are making decisions on Trailblazer capacity right now. When we invested in the Bighorn gas gathering project in December of 1999 we viewed a connection between Bighorn and Northern Border Pipeline (250miles) as a strategic advantage to be exploited in the future. Strong gas prices and the ramp of Powder River production are accelerating the feasibility of making a pipeline out of the Northern Powder River Basin a reality. While connecting the Powder River Basin to NBPL using an intrastate pipeline through Montana remains a real possibility it also carries with it the negative baggage of NBPL being fully contracted through 2003 (and possibly beyond) with Canadian gas and a potential for Alaskan gas. In the short term this presents us with some problems getting shippers to sign up for transport on the new Montana intrastate. I would like you to think about the following concept . A new interstate pipeline named NBP-Dakota extending from the Recluse Wyoming area to Ventura Iowa and going into service in November of 2003. A tentative design and cost would be 24 diameter 1435 MAOP 480 miles with capex of approximately $270 million. Initial flow would be 300 mmcfd with expansion capability up to 490 mmcfd and an initial rate of just under 50 cents per mcf Recluse to Ventura. At today's Ventura price of $4.22 this could leave Powder River producers a margin of more than $2.00 an mcf. Using August 1999 Ventura pricing of $2.64 the margin would be 64 cents. If we can build the pipeline at the cost projected (NPNG has used Fort Union's actual construction costs for a 24 inch 1440psi system - Enron Engineering would not even be in the same cost universe) NBP Dakota would be more competitive than sending the gas to NBPL via the Montana intrastate. I am of the opinion that future looping the Trailblazer system would come in as 3rd place to the other 2 routes. NBP Dakota would need to get started with an open season this fall to allow for a 2003 in-service date. THE QUESTION I need your opinion about using NBP Dakota for this opportunity rather than feeding more gas into NBPL in the northern Montana area. Strategically are we willing to let NBPL carry the possible risk of decontracting after 2003 without support from the Powder River Basin ? For what it may be worth I believe NBPL can handle that risk successfully without the Powder River volumes. I need to know your views on this as the Montana intrastate topic is coming up for discussion at the Bighorn Management Committee meeting later this summer. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Bay City News Wed 3/21: Blackouts Not Expected=20 Today Dow Jones Newswire Wed 3/21: Calif State Controller:General Fund Surplus = Dn=20 To $3.2B CBS.MarketWatch.com Wed 3/21: Davis says regulators will act to pay QFs Electricity providers insist they need to be paid Long Beach Press Wed 3/21: Rash power bill may need fix SF Chron Wed 3/21: PUC considers rewarding producers that sign long-term= =20 contracts Sac Bee Thurs 3/22: State claims $5.5 billion overcharge: Refunds by=20 wholesale generators sought Sac Bee Thurs 3/22: Power solution eludes Davis: Lawmakers grow edgy as= =20 crisis drags on Sac Bee Thurs. 3/22: Legislators learn some details of power contracts= San Diego Union Thurs 3/22: Federal judge orders major power wholesaler= =20 to sell to California San Diego Union Thurs. 3/22: Controller: State's power spending imperil= s=20 its financial health San Diego Union Wed 3/21: Governor says utilities must pay in advance f= or=20 some power LA Times Thurs 3/22: Energy Overcharge of $5.5 Billion Is Alleged LA Times Thurs 3/22: Power Strain Eases but Concerns Mount LA Times Thurs 3/22: Graphics: Overcharges Alleged=20 San Fran Chron Thurs 3/22: Net Complex A Dilemma For San Jose=20 SERVER FARM: Plant would tax grid San Fran Chron Thurs 3/22: Contracts Won't Meet Summer Demands=20 DETAILS: 2004 before full impact felt Mercury News Thurs 3/22: California overcharged $5.5 bln for wholesale= =20 power Orange Cty Register Thurs 3/22: Commentary: If the Power Goes Off =20 Orange Cty Register Thurs 3/22: Commentary: Socialized Electricity San Fran Chron Thurs 3/22: Bush's Energy Policy Will Backfire=20 Feinstein Warns / She wants federal price controls now Dow Jones Newswires Thurs 3/22: Reliant Still In Power Pact Talks With= =20 Calif. DWR Dow Jones Newswires Thurs 3/22: CPUC Must Address Rates In QF Repayment= =20 Order - SoCal Ed Dow Jones Newswires Thurs 3/22: Calif Small Pwr Producers To Shut Plant= s=20 If Rates Capped --- --- Blackouts Not Expected=20 Today Bay City News=20 Following two consecutive days of rolling blackouts California's power=20 picture looks much brighter today but conservation is still needed.=20 The California Independent System Operator is urging consumers to continue= =20 conservation measures during today's Stage One Electrical Emergency.=20 The conservation efforts of Californians particularly Tuesday evening we= re=20 significant and helped to reduce the duration and impact of yesterday's=20 blackouts'' according to officials. The California ISO asks customers to= =20 continue their voluntary reductions during this time of tight supply.=20 More than 11500 megawatts of in-state generation remain unavailable with= =20 power plants completing repairs and needed maintenance. However several=20 generating units returned to service today and the level of imported power= =20 has increased boosting the supply.=20 The ISO is cautiously optimistic that customer outages will be avoided=20 today'' according to officials.=20 Today's Stage One alert is in effect through midnight tonight.=20 Stage One Emergencies are declared when power reserves fall below 7 percent= .=20 Stage Two kicks in when reserves fall below 5 percent. Stage Three is=20 initiated when reserves drop to below 1.5 percent. --- Calif State Controller:General Fund Surplus Dn To $3.2B 03/21/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LOS ANGELES -(Dow Jones)- California State Controller Kathleen Connell=20 Wednesday said the state's general fund surplus has dropped to $3.2 billion= =20 from $8.5 billion in January mostly because of electricity purchases made = by=20 the state's Department of Water Resources a press release said.=20 Connell also denied Gov. Gray Davis' request to transfer an additional $5.6= =20 billion from the general fund to the Special Fund for Economic Uncertaintie= s=20 the release said. Connell noted that given the rapid depletion of the general fund on power= =20 purchases the state would need to borrow $2.4 billion in order to tranfer= =20 the $5.6 billion from the general fund to the special fund.=20 We started this year with a generous budget surplus. The energy crisis has= =20 taken much of that away and this transfer on top of the electricity=20 purchases would put the fund at risk Connell said.=20 Connell called on Davis to ensure that the CDWR completes by the end of May= =20 2001 the revenue bond sales that will be used to buy power and repay the=20 general fund.=20 She also asked that the CDWR notify her of all power purchases made and=20 contracts negotiated thus far and requested that she be told within 7 days = of=20 any purchases and contracts negotiated in the future.=20 Connell also said she wanted to be told within 24 hours of any power buys= =20 that exceed $55 million and asked that the Department of Finance be directe= d=20 to prepare new general fund cash flow estimates for the next 30 and 60 days= =20 and for the end of the fiscal year.=20 The state's Department of Water Resources has been buying power since Janua= ry=20 in lieu of Edison International (EIX) utility Southern California Edison an= d=20 PG&E Corp (PCG) utility Pacific Gas and Electric Co because suppliers=20 refused to sell to the nearly-bankrupt utilities.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 Gov. Davis' office said in response to Connell's comments that the state= =20 budget was solid and the economy remained strong.=20 We will be getting the money back we've paid for energy and it should have= =20 no significant effect on the state's finances from the Wall Street=20 perspective said Davis press secretary Steve Maviglio.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 jessicaberthold@dowjones.com --- -------- Davis says regulators will act to pay QFs Electricity providers insist they need to be paid By Russ Britt CBS.MarketWatch.com=20 Last Update: 9:45 PM ET Mar 20 2001 LOS ANGELES (CBS.MW) - California Gov. Gray Davis said regulators will act= =20 Tuesday on a plan to guarantee that independent power generators are paid. Independent power producers provide about 30 percent of California's=20 electricity from a variety of sources including wind solar and other=20 sources. Because many of the companies known as Qualifying Facilities or= =20 QFs haven't been paid they've begun to withhold power contributing to=20 blackouts in the state Monday and Tuesday.=20 We are anxious to pay the QFs because they're falling like flies Davis= =20 said at a news conference late Tuesday. If they don't get paid the lights= =20 will go out. Davis said the state's PUC order will require the state's nearly bankrupt= =20 utilities to enter five-year contracts with the QFs at rates of 7.9 cents p= er=20 kilowatt hour or 10-year contracts for lower rates. The structure is simil= ar=20 to rates Davis claims he was able to negotiate for long-term power contract= s=20 from out-of-state generators. --- Rash power bill may need fix By Will Shuck From our Sacramento Bureau SACRAMENTO Even as lawmakers lament the slow pace of solving California's= =20 energy crisis the cost of haste has cropped up in their first major act a= =20 multibillion dollar measure that put the state in the power-buying business= .=20 AB1X the highly touted bill that put California in the power-buying=20 business may have been so rashly crafted that it will take another piece o= f=20 legislation to fix it an influential senator said Tuesday.=20 At issue is vague wording that makes it unclear when and to what extent=20 Southern California Edison and other utilities have to repay the state for= =20 buying power.=20 State Sen. Debra Bowen chairwoman of the Senate Energy Utilities and=20 Communications Committee said the bill apparently has left room for utilit= y=20 lawyers to argue that their companies needn't repay the state until they ha= ve=20 covered other costs.=20 But Bowen a Redondo Beach Democrat who represents downtown and western Lon= g=20 Beach said the legislative intent is crystal clear that the state wanted= =20 to be repaid directly for supplying about a third of the power utility=20 companies deliver to their customers.=20 We need a cleanup bill to set the matter straight she said.=20 Although AB1X illustrates the flaws that come with speed Bowen said the= =20 Legislature can't afford to delay.=20 I think we are much too slow in our response she said. But that has to = be=20 balanced against things we've done in a tearing hurry and then have had to= =20 fix later.=20 No matter what the Legislature does in the coming weeks she said Californ= ia=20 is in for a tough summer and only determined conservation efforts will put= =20 much of a dent in a precarious supply-demand equation. --- PUC considers rewarding producers that sign long-term contracts=20 Greg Lucas Lynda Gledhill Chronicle Sacramento Bureau Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 Sacramento -- Some cash-strapped producers of wind solar and other=20 alternative forms of energy will get long-delayed financial relief under a= =20 proposed order by state regulators Gov. Gray Davis said yesterday evening.= =20 A proposed order by the Public Utilities Commission is designed to reward= =20 energy producers who sign long-term contracts with utilities at lower rates= .=20 Alternative energy producers that voluntarily enter such contracts which= =20 would start on April 1 would be paid within 15 days said Davis who=20 requested the order. Those that do not would have to wait until the utiliti= es=20 that buy their power return to solvency.=20 Davis blasted Pacific Gas & Electric Co. and Southern California Edison for= =20 not paying the alternative generators -- know as qualified facilities or= =20 QFs -- even though the companies have been collecting money through rates= .=20 It is wrong and irresponsible of the utilities to pocket and withhold the= =20 money designed to compensate the QFs Davis said. It's immoral and has to= =20 stop.=20 Alternative producers -- ranging from massive co-generation facilities at o= il=20 refineries to tiny biomass plants -- produce about a third of the state's= =20 supply of electricity. But many are shutting down because utilities have no= t=20 paid them since November.=20 The loss of some 3000 megawatts from tapped-out alternative energy produce= rs=20 contributed to the blackouts that snarled California yesterday and Monday= =20 according to the Independent System Operator which manages the state's pow= er=20 grid.=20 The PUC's proposed order -- which will be considered at the board's Tuesday= =20 meeting -- offers the generators a choice of agreeing to a five-year contra= ct=20 at $79 per megawatt or a 10-year deal at $69 per megawatt Davis said.=20 The order does not address the more than $1 billion already owed to the mor= e=20 than 600 alternative energy producers around the state. Davis said to favor= =20 one creditor over another in past debt could bring on bankruptcy proceeding= s=20 from other creditors.=20 The Legislature would also need to act to make the order work.=20 It is critical to keep these facilities up and online said Sen. Debra=20 Bowen D-Marina del Ray who estimates that Edison has $1.5 billion in cash= =20 on hand and PG&E $2.5 billion. The utilities owe it to the people of the= =20 state to pay them.=20 Edison said yesterday that it opposed any attempt to place alternative=20 producers ahead of their other creditors.=20 But Tom Higgins a senior vice president for Edison International which ow= es=20 alternative producers some $835 million said his company was talking to th= e=20 governor's office about possible payment structures.=20 Alternative energy producers particularly those that use high-priced natur= al=20 gas to fire their generators say that without an immediate infusion of cas= h=20 they must close their plants.=20 We've been obsessed with the health of the utilities and (have) forgotten= =20 the health of everyone else said V. John White legislative director of t= he=20 Clean Power Campaign which lobbies for alternative energy producers.=20 CalEnergy Operating Corp. which operates eight geothermal plants in the=20 Imperial Valley producing 268 megawatt hours for Edison has sued the utilit= y=20 asking to be paid and to be temporarily released from their contract with= =20 Edison which has paid them nothing since November.=20 CalEnergy has a court hearing tomorrow on its Edison contract. Edison owes= =20 the company $75 million and the debt increases by $1 million a day.=20 We've lived up to our end of the bargain but Edison hasn't. We're now not = in=20 a position to make a property tax payment on April 10 and we're the largest= =20 employer in the county said Vince Signorotti CalEnergy's property manage= r.=20 Unlike Edison PG&E is paying its creditors 15 cents on the dollar.=20 We have offered over the past five days to prepay for future power not yet= =20 delivered to keep as many of them operating as possible but the state need= s=20 to decide how its going to divvy up the limited money under the frozen=20 rates said John Nelson a PG&E spokesman.=20 The PUC's sudden attempt to recast the rates paid to alternative generators= =20 comes after several months of inaction partly a result of waiting for=20 legislative negotiations on the issue to conclude. Those negotiations=20 eventually failed to move forward.=20 --- State claims $5.5 billion overcharge: Refunds by wholesale generators sough= t By Dale Kasler Bee Staff Writer (Published March 22 2001)=20 In its boldest attempt yet to extract refunds from wholesale power=20 generators the state's grid operator accused the generators Wednesday of= =20 overcharging Californians by $5.5 billion for electricity since last May.= =20 The state's Independent System Operator which manages the state's=20 transmission grid plans to tell a federal regulatory agency today that pow= er=20 generators consistently took advantage of their stranglehold on the=20 California market to ratchet up prices.=20 The federal agency the Federal Energy Regulatory Commission recently=20 threatened to order generators to refund $134.8 million for overcharges=20 mostly covering January and February. But those refunds amounted to just a= =20 fraction of what the grid operator was seeking. The ISO which has been=20 complaining about market abuses for several months says FERC must do more.= =20 We're happy that (FERC) took this first step but we think there's a long= =20 way to go said Anjali Sheffrin the ISO's director of market analysis. A= s=20 far as I'm concerned it's been too little too late. ... The refunds they= =20 have acted on (so far) have been minimal.=20 She said the report covers five major power suppliers and 16 other power=20 importers.=20 FERC Commissioner William L. Massey said it would be improper for him to=20 comment on a report that has not yet been filed. But when told of the $5.5= =20 billion total Massey told the Los Angeles Times: That doesn't shock me in= =20 any way.=20 Prices over the past 10 months in California have greatly exceeded the=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said.=20 However most FERC critics are skeptical that the federal agency which is = a=20 strong believer in letting free markets run their course would order a=20 refund anywhere near as large as $5.5 billion -- even though it has found= =20 that California prices at times have been unjust and unreasonable.=20 The big power generators saying their charges were reasonable are disputi= ng=20 the $134.8 million refunds proposed so far and have vowed to fight the ISO'= s=20 latest effort.=20 If the ISO were to prevail the $5.5 billion in refunds could go a long way= =20 toward remedying California's energy mess.=20 They could help restore the financial health of Pacific Gas and Electric Co= .=20 and Southern California Edison which have nearly been bankrupted by the=20 prices charged by the power generators. They also could ease the strain on= =20 the state treasury which is spending billions to purchase electricity for= =20 Californians because PG&E and Edison can't.=20 Sheffrin said her department studied sales made by the power generators to= =20 ISO which makes last-minute power purchases to balance supply with demand= =20 and the California Power Exchange the now-bankrupt entity where most of=20 California's wholesale electricity was bought and sold until December.=20 She said the study made very generous allowances for natural gas expenses= =20 costly air-pollution credits and other factors including the scarcity of= =20 electricity. The result was $5.5 billion worth of charges in excess of=20 competitive costs she said.=20 In many cases the companies used their market clout to submit bids that we= re=20 way beyond their costs she said.=20 It was insufficient competition Sheffrin said. They got away with a lot= .=20 She said the refund request isn't just a shot in the dark. FERC she noted= =20 has already found that prices in the California wholesale energy market ha= ve=20 been unreasonable. We took it upon ourselves ... to show FERC how they got = to=20 be so high.=20 FERC proposed refunds totaling $124 million for January and February sales= =20 declaring that generators' prices were too high.=20 In a separate case the federal agency for the first time accused two=20 generators last week of taking plants offline to force prices up.=20 --- Power solution eludes Davis: Lawmakers grow edgy as crisis drags on=20 By Emily Bazar and Amy Chance Bee Capitol Bureau (Published March 22 2001)=20 Gov. Gray Davis likes to compare the state's energy crisis to a complicated= =20 three-cornered billiard shot.=20 But as California plunged into another round of power blackouts this week= =20 Davis has yet to line up the angle on an ultimate solution.=20 The state's short-term power bill is nearing $4.2 billion and legislators= =20 are balking at the administration's requests for additional money.=20 Getting even the least controversial pieces of the puzzle through the=20 Legislature is taking weeks longer than expected.=20 While the Democratic governor has insisted secrecy about details of his pow= er=20 purchases is necessary to protect the state's bargaining position other=20 state officials are complaining vigorously about the lack of information.= =20 And critical deals the governor hoped to reach with energy suppliers and=20 utility companies are proving difficult to close.=20 I think we all got lulled into a little complacency a few weeks ago. All= =20 these things seemed to be going along and the governor was making all thes= e=20 warm and fuzzy comments said Assemblyman John Campbell R-Irvine.=20 But it only takes one deal to go sideways and we're all blacked out he= =20 added. The governor is running around basically saying 'Trust me.' I'm no= t=20 sure he's deserving of the trust at this point.=20 Davis and his aides insist they are working around the clock on plans to=20 boost power generation encourage conservation and reach an agreement with= =20 utilities that will keep them out of bankruptcy.=20 The utility plan they say is the equivalent of a large corporate merger= =20 that simply can't be accomplished overnight. Davis notes that earlier=20 deregulation efforts might have benefitted from a little more time.=20 Although the state has reached a broad agreement in principle with Southe= rn=20 California Edison to obtain its power transmission lines in exchange for he= lp=20 paying off its debts a final detailed deal has not been reached. The=20 initial agreement with Edison was announced Feb. 23.=20 And the governor has yet to achieve a tentative agreement with Pacific Gas= =20 and Electric Co. which is driving a harder bargain over price and other=20 elements of a potential rescue plan.=20 Joseph Fichera one of several consultants receiving more than $11 million= =20 from the administration for advice on the energy crisis said many people= =20 don't realize the complexity of the deal they're brokering.=20 In their bid to achieve a public takeover of the investor-owned utilities'= =20 transmission lines he said negotiators have to pore over thousands of=20 documents related to the transmission lines alone.=20 We are doing what is normal in a transaction of this magnitude which is= =20 investigate document circulate redocument agree move forward said=20 Fichera an investment banker with Saber Partners in New York City. The=20 governor has put a 'I want this yesterday' fire under his negotiating team= .=20 The negotiator however declined to say when he expects final agreements t= o=20 be reached with the companies.=20 It could be days it could be weeks he said.=20 There were signs meanwhile of trouble brewing on another front: the giant= =20 bond sale the state must make to repay the money it has spent so far on=20 electricity and to finance future long-term contracts for energy.=20 State Treasurer Phil Angelides said Wednesday the utilities are appealing a= =20 ruling by the state Public Utilities Commission that essentially ensures th= e=20 state will be repaid a move that he said threatens to delay the sale=20 indefinitely.=20 If the utilities have decided to adopt a scorched earth policy until they= =20 get what they need and want then it will be a significant problem=20 Angelides said.=20 PG&E spokesman Ron Low said the governor is simply placing too many demands= =20 on a rate structure that doesn't compensate the utilities for their current= =20 costs.=20 Political rhetoric is not going to change the math he said.=20 In the Legislature lawmakers are growing grumpier. Most were taken by=20 surprise Monday when blackouts were ordered across the state weeks before= =20 summer temperatures were expected to set in and strain the power system.=20 I'm more worried than ever said Assemblyman Bill Leonard R-San=20 Bernardino. A lot of the elements we thought we had a handle on in January= =20 are unraveling.=20 A deal the governor said had been worked out weeks ago between the state an= d=20 more than 600 small alternative energy suppliers collapsed last week.=20 The alternative generators have not been paid by the utilities for months= =20 and state leaders attempted to bargain down the price utilities pay those= =20 generators for power.=20 But administration officials complained privately that lawmakers instead=20 sweetened the pot for the suppliers to the point that the measure no longer= =20 helped solve the overall financial situation pushing the utilities toward= =20 bankruptcy. Under a proposal announced Tuesday by Davis the Legislature=20 would authorize the PUC to require the utilities to pay the alternative=20 suppliers at prices more closely resembling the original deal.=20 But the governor ran into immediate opposition as some suppliers said said= =20 he would not pay them enough to cover their fuel costs.=20 We would go from not being paid to losing money said Hal Dittmer of=20 Wellhead Electric a Sacramento-based supplier that has been shut down for= =20 more than a month. Almost everybody who burns natural gas is going to shut= =20 down. (Davis) got it wrong.=20 Democrats outside the Davis administration meanwhile are complaining abou= t=20 the amount of money the state Department of Water Resources is spending on= =20 expensive last-minute power purchases. Within a week $4.2 billion will ha= ve=20 been committed.=20 State Sen. Steve Peace D-El Cajon chairman of the joint Legislative Budge= t=20 Committee is warning the Davis administration that he will block additiona= l=20 funds for last-minute purchases of power until the PUC makes progress=20 recovering money that already has been spent. He intends to hold a hearing = on=20 the issue this morning.=20 On Wednesday state Controller Kathleen Connell told Davis she will refuse = to=20 make a routine budget transfer he had requested saying she is concerned th= at=20 there is no outside check and balance on the money the administration is= =20 spending to buy electricity on the spot market.=20 As the statewide elected official who pays the state's bills Connell said= =20 she has yet to receive information from the Department of Water Resources= =20 about how much it is spending.=20 We really need an accounting as to the total amount of liability they have= =20 accumulated she said. I understand they're in an emergency situation ...= =20 but it begins to imperil the state's ability to manage its cash flow.=20 Meanwhile a bill to provide $1 billion for conservation programs aimed at= =20 reducing power needs this summer also has languished for several weeks in= =20 the state Senate. While Davis has focused his attention elsewhere Republic= an=20 lawmakers have opposed the measure as too expensive. Democrats argue that= =20 each two-week delay prevents the state from saving as much energy as one=20 peaker plant will produce this summer. Peaker plants are designed to help= =20 meet the peaks of electricity demand.=20 I'm the eternal optimist but we have to keep working on all fronts said= =20 Sen. Byron Sher D-Palo Alto who hopes to take his energy conservation bil= l=20 up for a vote in the Senate again today. It's a formidable challenge.=20 Bee staff writer Dale Kasler contributed to this report.=20 --- Legislators learn some details of power contracts By John Hill Bee Capitol Bureau (Published March 22 2001)=20 The veil of secrecy surrounding the state's electricity contracts lifted=20 Wednesday -- a little.=20 Gov. Gray Davis gave state legislators a report laying out some of the=20 details of long-term contracts designed to help the state pull out of its= =20 energy crisis. But the report left legislators and others clamoring for mor= e.=20 The information raises more questions said Assemblyman George Runner=20 R-Lancaster. I liken it to watching a parade through a knothole in a fence= .=20 You get to look at one float but you're not sure about what's coming up an= d=20 what you've missed.=20 Davis had previously disclosed that the state had signed or was close to=20 signing 40 long-term contracts at an average price over 10 years of $69 pe= r=20 megawatt-hour.=20 The contracts are part of the state's strategy for trying to avoid a fiscal= =20 shellacking in the energy spot market while making sure there's enough=20 electricity to avoid more blackouts.=20 Davis also previously disclosed that the contracts were for an average of= =20 about 9000 megawatts a year and that the total cost exceeded $40 billion.= =20 But Davis has resisted telling more saying the state would jeopardize its= =20 ability to get the best prices if electricity generators knew what their=20 counterparts were getting.=20 On Wednesday the governor's office released a March 15 report from S. Davi= d=20 Freeman general manager of the Los Angeles Department of Water and Power = to=20 the state Department of Water Resources. The state agency has been given th= e=20 responsibility of making power purchases and Freeman was brought in to lea= d=20 the negotiations.=20 As of March 15 the state had signed 19 contracts with seven suppliers for= =20 periods ranging from 14 months to 20 years with many for three or five=20 years the report says. Some of the contracts are for electricity to meet t= he=20 state's everyday power demand while others are only for times of peak use= =20 such as hot summer days.=20 The state had agreements in principle for an additional 25 contracts.=20 Runner said he has been told that two of these contracts have since been=20 finalized.=20 The amount of power provided reaches a peak in 2004 of more than 10000=20 megawatts. As the long-term contracts start to expire around then the stat= e=20 is hoping that demand can be met with new contracts or spot purchases at=20 prices expected to be much cheaper.=20 The report says nine more long-term contracts were under discussion.=20 Some of the contracts are with power generators while others are with=20 marketers who may get the power from a number of sources.=20 In some cases the state may supply the natural gas used to generate the=20 electricity or power costs may be pegged to the going rate for the fuel.= =20 Some suppliers can cancel if the state fails to sell bonds by a certain dat= e=20 to cover power costs or fails to maintain an investment grade credit rating= .=20 Some depend on the construction of power plants but Freeman said they were= =20 firm commitments.=20 We were pretty careful not to put a hope and a dream in the portfolio he= =20 said.=20 More contracts will have to be signed to meet summer demand and these=20 agreements will probably be more expensive the report says.=20 One item not in Freeman's report was a secret deal to relieve several major= =20 generators from having to pay for polluting the air beyond allowable limits= .=20 The long-term power contracts include language that would have the state pa= y=20 the costs of pollution credits that allow power plants to exceed their=20 permitted levels of smog-forming pollutants the governor's office confirme= d=20 Wednesday. Spokesman Steve Maviglio said that several generators are being= =20 relieved from having to pay those costs.=20 V. John White a Sierra Club lobbyist close to the negotiations said Dyneg= y=20 Inc. which has power plants in El Segundo Encina and Long Beach is one o= f=20 them. Dynegy officials did not return calls to The Bee on Wednesday.=20 Freeman said that generators were demanding hefty premiums for having to de= al=20 with air quality regulators in the summer and he figured it would be cheape= r=20 just to pay for the pollution credits.=20 In other energy-related developments:=20 With more power plants back online grid operators dropped down to a Stage = 1=20 electricity alert. The state Independent System Operator was expecting=20 supplies to gradually increase over the next few days.=20 The state Public Utilities Commission issued a revised draft decision that= =20 would impose the prices outlined Tuesday by Davis for power produced by=20 alternative energy companies -- $79 a megawatt-hour for five-year contracts= =20 or $69 a megawatt-hour for 10 years. The proposal is scheduled for a PUC vo= te=20 March 27.=20 A federal judge ruled that one of the nation's major electricity generators= =20 must continue supplying California with emergency power.=20 In imposing an injunction on Reliant Energy Services Inc. U.S. District=20 Judge Frank C. Damrell Jr. noted the rolling blackouts (that have) darkene= d=20 the California landscape and said the loss of Reliant's production poses = an=20 imminent threat.=20 Bee staff writers Carrie Peyton Chris Bowman and Denny Walsh contributed t= o=20 this report.=20 --- Federal judge orders major power wholesaler to sell to California=20 By Don Thompson ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) A federal judge issued a preliminary injunction Wednesday= =20 ordering a major electricity wholesaler to continue selling to California= =20 despite its fear that it will not get paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant Energy Services stopped selling power to the=20 Independent System Operator which oversees the state's power grid. The ISO= =20 buys last-minute power on behalf of utilities to fill gaps in supply to try= =20 to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The state has been spending about $50 million a day on power for Pacific Ga= s=20 and Electric Co. and Southern California Edison both denied credit by=20 suppliers after amassing billions of dollars in debts.=20 Controller: State's power spending imperils its financial health=20 Governor says utilities must pay in advance for some power=20 ?=20 The judge said he had no authority to force the DWR to pay for that power.= =20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 Damrell denied the ISO's request for preliminary injunctions against three= =20 other wholesalers Dynegy AES and Williams who agreed to continue selling= =20 to the ISO pending the FERC ruling.=20 The ISO went to court in February after a federal emergency order requiring= =20 the power sales expired. The judge then issued a temporary restraining orde= r=20 requiring the sales but dropped it after the suppliers agreed to continue= =20 sales to California pending his Wednesday ruling.=20 The ISO said it would lose about 3600 megawatts if the suppliers pulled ou= t=20 enough power for about 2.7 million households. One megawatt is enough for= =20 roughly 750 homes.=20 Grid officials said Reliant's share alone is about 3000 megawatts. Reliant= =20 said the amount at issue actually is less than a fourth of that because mo= st=20 of the power is committed under long-term contracts.=20 Reliant which provides about 9 percent of the state's power worries it=20 won't get paid due to the financial troubles of PG&E and Edison.=20 PG&E and Edison say that together they have lost about $13 billion since Ju= ne=20 due to soaring wholesale electricity costs that California's 1996=20 deregulation law bars them from passing onto customers.=20 At the same time the state has faced a tight electricity supply due in pa= rt=20 to California power plant shutdowns for maintenance and to a tight=20 hydroelectric supply in the Pacific Northwest.=20 Managers of the state power grid imposed rolling blackouts across the state= =20 Monday and Tuesday as supply fell short of demand. Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts.=20 State Controller Kathleen Connell said Wednesday that the energy crunch als= o=20 imperils California's financial health.=20 Connell said the state's power-buying on behalf of Edison and PG&E is is=20 gutting its budget surplus. Since the state started making emergency power= =20 buys in January the surplus has fallen from $8.5 billion to about $3.2=20 billion she said.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is refusing a request by Davis and the Legislature to transfer $5.6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its=20 power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= =20 The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 --- Controller: State's power spending imperils its financial health=20 By Don Thompson ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) California's power-buying on behalf of two strapped utiliti= es is=20 gutting its budget surplus and putting the state at financial risk the sta= te=20 controller said Wednesday.=20 The surplus dropped from $8.5 billion in January when the state began buyi= ng=20 electricity for Pacific Gas and Electric Co. and Southern California Edison= =20 to $3.2 billion now Kathleen Connell estimates.=20 Connell ordered an audit of the state's power-buying saying Gov. Gray Davi= s=20 is withholding key financial information from her office and the Legislatur= e.=20 Wednesday marked the first time in three days the state avoided rolling=20 blackouts. Power grid officials credited cooling temperatures and the=20 completion of repairs at several power plants.=20 Connell said the energy crunch now imperils the state's budget as well as i= ts=20 electric grid.=20 California has been spending about $45 million a day =01) $4.2 billion so f= ar =01)=20 to buy power for Edison and PG&E both denied credit by electricity=20 wholesalers.=20 The two utilities California's largest say they are nearly $14 billion in= =20 debt due to soaring wholesale power costs the state's deregulation law bloc= ks=20 them from recovering from customers.=20 Meanwhile the state has faced high natural gas costs and a tight power=20 supply driven in part by power plant repairs in California and scarce=20 hydroelectric power in the Pacific Northwest.=20 Standard & Poor's has put the state on a credit watch due to its power=20 purchases and chastised Davis the Legislature and state regulators for not= =20 taking more aggressive steps to assure the utilities can pay their bills.= =20 On Wednesday Connell said she is refusing a request by Davis and the=20 Legislature to transfer $5.6 billion into a rainy day fund she said was s= et=20 up to impress Wall Street as the state prepares to issue $10 billion in=20 revenue bonds to cover its power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Connell said the scope of the proposed transfer is unprecedented and amount= s=20 to a shell game that disguises the power purchases' impact on the state= =20 budget.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= =20 The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details. He said his= =20 plan may involve giving the utilities low-interest loans with their=20 transmission lines held as collateral.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 --- Governor says utilities must pay in advance for some power=20 By Jennifer Coleman ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) The state's two largest utilities will be ordered to pay=20 environmentally friendly power generators in advance a move Gov. Gray Davi= s=20 hopes will bring a quick end to the power blackouts that darkened Californi= a=20 this week.=20 The statewide blackouts that stretched from San Diego to Oregon on Monday a= nd=20 Tuesday were caused in part by the failure of Southern California Edison an= d=20 Pacific Gas and Electric Co. to pay millions of dollars they owe qualifyin= g=20 facilities or QFs Davis said.=20 Such suppliers use cogeneration =01) steam from manufacturing plus natural = gas =01)=20 or solar wind and other renewable energy to generate electricity. This wee= k=20 California lost about half the power those generators normally provide.=20 Controller: State's power spending imperils its financial health=20 ?=20 Several of them said they hadn't been paid by Edison and PG&E in weeks and= =20 can't afford to keep operating their plants.=20 Davis accused the utilities of taking in money from customers while failing= =20 to pay the QFs. The state has been spending about $45 million a day since= =20 January to buy power for customers of Edison and PG&E which are so=20 credit-poor that suppliers refuse to sell to them.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators the governor said at a Capitol news conference Tuesday= =20 evening. They've acted irresponsibly and immorally and it has to stop.=20 PG&E called the governor's statements inappropriate and unjustified addi= ng=20 that it was negotiating a payment plan with the QFs. Edison said it is inte= nt=20 on paying creditors and working with the California Public Utilities=20 Commission to pay QFs for future power sales.=20 Controller Kathleen Connell warned Wednesday that the state's $2=20 billion-a-month power purchases are jeopardizing California's budget.=20 The state's budget surplus dropped from $8.5 billion in January when the= =20 power purchases began to $3.2 billion now Connell estimates. She blamed= =20 Davis for withholding key financial information and ordered an audit of th= e=20 state's power spending starting next week.=20 She blocked a request by the Legislature and Davis administration to transf= er=20 $5.6 billion from the state's general fund into a special rainy day fund= =20 saying that would have left the general fund $2.4 billion in debt.=20 The Legislative Analyst's Office said such transfers are routine Connell= =20 agreed but said the size of the transfer is unprecedented.=20 We started this year with a generous budget surplus Connell said. The= =20 energy crisis has taken much of that away and this transfer on top of the= =20 electricity purchases would put the fund at risk.=20 Meanwhile keepers of the state's power grid were optimistic California wou= ld=20 get through Wednesday without another day of rolling blackouts. Two plants= =20 down for repairs returned to service.=20 Several power plants that were taken down for repairs are also expected com= e=20 online by the end of the week reducing the likelihood of blackouts said J= im=20 Detmers ISO vice president.=20 Power may flow to homes and businesses but it could soon cost consumers=20 more said Assemblyman Fred Keeley one of the Legislature's leaders on=20 energy issues.=20 I think it's intellectually appropriate and honest to tell people as soon = as=20 it's apparent that a rate increase is warranted the Boulder Creek Democra= t=20 said Tuesday indicating that time had come.=20 He estimated that the state Public Utilities Commission may soon have to=20 raise rates by about 15 percent to cover the state's costs and its utilitie= s'=20 bills.=20 My sense is that people will appreciate having some certainty and being ab= le=20 to plan for it he said. They don't have to like it but I think they'll= =20 appreciate it.=20 Davis said he is confident the utilities and the state can pay their bills= =20 without further rate increases for Edison and PG&E customers.=20 In the meantime the Independent System Operator keeper of the grid is=20 counting on continued conservation by residents and businesses to avoid mor= e=20 blackouts. Conservation accounted for about 300 megawatts in savings during= =20 Tuesday's peak usage enough to power 300000 homes.=20 Roughly a half-million homes and businesses were affected by Tuesday's=20 blackouts which snarled traffic and plunged schools and businesses into=20 darkness across the state.=20 The outages began at 9:30 a.m. and continued in 90-minute waves until about= 2=20 p.m. when the ISO lifted its blackout order. They were blamed for at least= =20 one serious traffic accident.=20 Two cars collided at an intersection in the Los Angeles suburb of South El= =20 Monte where the traffic lights were out. Two people were seriously hurt sa= id=20 California Highway Patrol Officer Nick Vite.=20 In San Francisco's Chinatown souvenir shops normally bustling with visitor= s=20 were forced to shut down. Nearby irritated customers waited for a bank to= =20 reopen.=20 The blackouts like Monday's were caused by a combination of problems=20 including unseasonably warm weather reduced electricity imports from the= =20 Pacific Northwest and numerous power plants being shut down for repairs.=20 Adding to those troubles the state lost about 3100 megawatts from the QF= =20 plants.=20 Senate Energy Committee Chairwoman Debra Bowen D-Marina del Rey estimated= =20 Tuesday that Edison has amassed more than $1 billion and PG&E more than $2= =20 billion that they have not paid to generators.=20 Davis said the PUC planned to issue an order next week directing the=20 utilities to pre-pay their future QF bills.=20 PG&E said its prepayments hinge on an upcoming PUC decision on whether the= =20 utility's rates are sufficient to pay its bills and cover the state's power= =20 purchases on its behalf which amount to $4.2 billion since early January.= =20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices which the state's 1996 deregulation= =20 law prevents them from passing on to ratepayers.=20 --- Energy Overcharge of $5.5 Billion Is Alleged=20 Power: Money should be refunded to taxpayers and utilities the state grid= =20 operator says citing evidence of market manipulation. Suppliers deny the= =20 accusation.=20 By TIM REITERMAN and NANCY RIVERA BROOKS Times Staff Writers=20 ?????Wholesale electricity suppliers overcharged California by about $5.5= =20 billion between May and last month and that money should be refunded to th= e=20 state's taxpayers and financially strapped utilities the state power grid= =20 operator said Wednesday. ?????Generators engaged in market manipulation and consistent patterns of= =20 bidding far above costs in the deregulated energy market the California=20 Independent System Operator found in a study of pricing data. The findings= =20 support the widespread belief that these suppliers reaped massive additiona= l=20 revenue by manipulating the market. ?????Spokesmen for the companies denied the accusation. ?????The study prepared for a filing with federal regulators today is=20 central to Cal-ISO's efforts to seek reimbursement for what it considers=20 excessive charges by electricity suppliers during the state's energy crisis= . ?????This might be the first time we told them the total impact and=20 magnitude [of the overcharging] said Anjali Sheffrin Cal-ISO's director = of=20 market analysis. We think the entire amount deserves consideration for=20 refunds. ?????Using confidential bidding data on tens of thousands of electricity=20 sales Cal-ISO found that five companies that together supply about 30% of= =20 the power delivered to customers of the state's investor-owned utilities=20 engaged in two types of behavior that tended to push up prices: ?????* They effectively withheld supplies by bidding at excessive prices= =20 even though they could have made some money selling more electricity. ?????* Less frequently they had power generation available but did not bid= =20 at all. ?????The study concluded that energy suppliers commonly offered their=20 electricity at twice their cost. For example Sheffrin said the average=20 markup in August was 100% during peak hours. ?????A spokeswoman at the Federal Energy Regulatory Commission which=20 oversees wholesale electricity pricing across the country declined to=20 comment Wednesday saying This is part of an ongoing proceeding. ?????FERC member William L. Massey who has considered previous commission= =20 actions on refunds to be inadequate said it would be improper for him to= =20 comment on a report that has not yet been filed. But when told of the=20 $5.5-billion total Massey said: That doesn't shock me in any way. ?????Prices over the past 10 months in California have greatly exceeded th= e=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said. ?????Cal-ISO which oversees grid operations and an emergency energy market= =20 previously detailed $550 million in alleged overcharges for December and=20 January and asked FERC for refunds. But the commission has proposed refunds= =20 of only a tiny fraction of that amount. ?????The study covered five major in-state power suppliers--Reliant Energy= =20 Dynegy Williams/AES Duke Energy and Mirant formerly Southern Energy--plu= s=20 16 power importers all of which deliver power to customers of Pacific Gas = &=20 Electric Co. Southern California Edison and San Diego Gas & Electric Co. ?????All [21] overcharged but some excessively and some by moderate=20 amounts Sheffrin said. ?????Cal-ISO's public filing will quantify the alleged overcharging by each= =20 company but the companies will be identified only by a number. The code wi= ll=20 be provided to FERC Sheffrin said and Cal-ISO lawyers will determine how= =20 much information about the companies will be made public. ?????State U.S. Investigations ?????California electricity markets and the companies that buy and sell pow= er=20 in the state have been the subject of several investigations by state and= =20 federal authorities since wholesale electricity prices first skyrocketed in= =20 May. ?????Electricity suppliers have repeatedly denied manipulating the Californ= ia=20 market in any way whether through above-cost bidding in spot markets or=20 through physical withholding of electricity to drive up prices. ?????Reliant Energy is cooperating with FERC's requests for more data and i= s=20 confident the commission will conclude that prices charged by Reliant were= =20 justified said Joe Bob Perkins president of the Houston-based company. ?????Perkins also bitterly disputed charges that Reliant has shut down unit= s=20 so that it can earn bigger profits on the power sold by the remaining plant= s.=20 These charges have been leveled against all of the power-plant owners in th= e=20 state. ?????Reliant Vice President John Stout said Cal-ISO's calculations typicall= y=20 don't include such fixed costs as salaries taxes and the interest on bonds= =20 they sold to finance their power plants which they acquired under terms of= =20 the state's landmark 1996 deregulation law. ?????In addition he said many high-priced power days have resulted from= =20 buyers bidding against each other for scarce supplies rather than sellers= =20 charging excessive amounts--like a house price being driven far above the= =20 listing price in a hot real estate market. ?????Williams Energy Services a trading company that markets most of the= =20 power produced by plants owned by AES also says it will be exonerated by= =20 FERC once the commission examines documentation being submitted said Paula= =20 Hill-Collins spokeswoman for the Tulsa Okla. company. ?????FERC has the obligation to investigate when these accusations are=20 made Hill-Collins said. This is just a process of justification not=20 necessarily proof of guilt. ?????Williams/AES was recently ordered by FERC to prove that it did not tak= e=20 generating units out of service last year to drive up electricity prices o= r=20 refund $10.8 million to California utilities. ?????During the period studied suppliers sold electricity in the Californi= a=20 Power Exchange to Southern California Edison PG&E and San Diego Gas &=20 Electric Co. and in a backup market for last-minute electricity operated by= =20 Cal-ISO. But sky-high prices plunged Edison and PG&E deeply into debt and= =20 most suppliers stopped selling to them in January forcing the state=20 Department of Water Resources to step in as the primary electricity buyer f= or=20 the three big utilities' 27 million customers. ?????The Cal-ISO study first summarized at an energy conference last week = at=20 UC Berkeley but not otherwise publicized concluded that the companies=20 exercised so-called market power to pump up electricity prices. ?????Severin Borenstein director of the Energy Institute at Berkeley said= =20 Cal-ISO's study is consistent with his research examining pricing practices= =20 in 2000. ?????We found several billion dollars . . . in departures from competitive= =20 pricing he said. When the market was tight this summer they were able t= o=20 push up prices and they did. ?????The early warning signs of electricity price spikes the study found= =20 appeared in May after two years of relatively stable prices of $30 to $40 p= er=20 megawatt-hour under deregulation. Prices went up during the summer dipped = in=20 September and October with lower demand then took off in November and=20 December as weather turned cold and the price of natural gas which is used= =20 to generate much of the state's electricity reached record levels. ?????There were plant outages and demand and supply became close Sheffr= in=20 said. Whatever price they bid had to be taken and market power asserted= =20 itself. ?????Cal-ISO found that $3 billion of the alleged overcharges occurred=20 between May and November. ?????On Friday federal regulators ordered six wholesale power suppliers to= =20 refund $55 million to California if they cannot justify prices charged in= =20 February. The refund was limited to power sold that month in excess of $430= =20 per megawatt-hour during Stage 3 power alerts when supplies are so tight= =20 that rolling blackouts are threatened. (One megawatt-hour is enough=20 electricity to supply 750 typical homes for an hour.) ?????The previous week FERC ordered 13 suppliers to justify or refund $69= =20 million for power sold in January at prices above $273 per megawatt-hour. ?????Massey opposed the potential refunds as too low because they were=20 limited to hours in which a Stage 3 power emergency was in place and becaus= e=20 the benchmark price set for each month was too high--combining to exempt mo= re=20 than 70000 transactions from scrutiny. ?????We're still looking for our lost wallet under the lamppost which is= =20 Stage 3 alerts said Massey one of three commissioners on the five-member= =20 board (two seats are vacant). ?????Generators have been given the free and clear he said. ?????These tinkling little refunds they have come out with recently are=20 almost a joke said Cal-ISO board member Mike Florio senior attorney at t= he=20 Utility Reform Network. ?????Resisting Price Caps ?????Cal-ISO contends that the last 10 months have proved that generators c= an=20 no longer be allowed to receive electricity prices that are dictated by wha= t=20 the market will bear. ?????FERC granted market-based rate authority on each of these suppliers'= =20 own showing that they could not manipulate prices yet their actions have= =20 shown the contrary Sheffrin said. We feel FERC needs to look at the=20 premise of allowing these generators to continue selling at market-based=20 rates. ?????The commission is responsible for ensuring just and reasonable=20 electricity rates. Although it has called California's power market=20 dysfunctional and vulnerable to manipulation the agency has resisted setti= ng=20 firm price caps sought by California's congressional delegation. ?????Chairman Curt L. Hebert Jr. strongly opposes caps while Massey wants = to=20 use caps across the West as a temporary timeout. ?????Energy Secretary Spencer Abraham in a New York news conference=20 Wednesday reiterated his opposition to electricity price caps as a way to= =20 cope with California's energy crisis. ?????If we put price caps in place there will be more blackouts and=20 they'll be worse Abraham said. ?????Cal-ISO is filing its market study as part of its comments on FERC sta= ff=20 recommendations on ways to thwart market manipulation. FERC's proposal=20 includes strict coordination of power plant outages by Cal-ISO with reporti= ng=20 of suspicious closures to FERC and generator-by-generator bid caps tied to= =20 costs. ---=20 ?????Reiterman reported from San Francisco Rivera Brooks from Los Angeles.= =20 Times staff writer Thomas S. Mulligan in New York contributed to this story= . --- --- Power Strain Eases but Concerns Mount=20 Energy: Officials say summer prices will be high and a state report shows= =20 that contracts with generators are far short of goals.=20 By DAN MORAIN and JENIFER WARREN Times Staff Writers=20 ?????SACRAMENTO--California's fragile electricity system stabilized=20 Wednesday but a Davis administration report suggested troubles ahead becau= se=20 the state could be forced to buy most of its power for the coming summer on= =20 the costly and volatile spot market. ?????After two days of statewide blackouts power plants that had been shut= =20 down were cranked up. Unseasonable heat tapered off. The operators of the= =20 statewide power grid relaxed their state of emergency. ?????But plenty of ominous signs remained. Many small producers remained sh= ut=20 down skeptical about Gov. Gray Davis' plan for utilities to pay them. ?????State Controller Kathleen Connell issued a sharp warning about the hig= h=20 cost of the state's foray into the power business and announced that she wi= ll=20 block an administration request that she transfer $5.6 billion into an=20 account that could be tapped to pay for state purchases of electricity. ?????And a report from the administration summarizing contracts between Dav= is=20 and independent power generators showed that the state has signed contracts= =20 for only 2247 megawatts of electricity significantly less than the 6000 = to=20 7000 megawatts previously claimed. ?????While there are agreements in principle for the full amount the repor= t=20 notes that generators can back out of the contracts for a variety of reason= s=20 including the state's failure to sell bonds to finance power purchased by= =20 July 1. The Legislature has approved plans to sell $10 billion in bonds bu= t=20 none have yet been issued. ?????We are exposed enormously this summer Senate Energy Committee=20 chairwoman Debra Bowen (D-Marina del Rey) said after looking at the report.= =20 We owe the people the truth about how difficult this summer is going to be= .=20 We don't have a power fairy. ?????Perhaps most significant the report suggests that the contracts fall= =20 significantly short of Davis' stated goal of buying no more than 5% of the= =20 state's summer needs on the spot electricity market where prices can be ma= ny=20 times those of long-term contracts. ?????After reading the report Frank Wolak a Stanford University economist= =20 who studies the California electricity market said the numbers suggested= =20 that the state's long-term contracts will cover less than half of what the= =20 state will need this summer. ?????We're definitely short this summer next summer and the summer of=20 2003 he said. ?????California was forced to start buying electricity in December--at a co= st=20 of $50 million a day--because producers refused to sell to Southern=20 California Edison and Pacific Gas & Electric. The two utilities amassed=20 billions of dollars in debt when prices for wholesale power soared on the= =20 spot market. ?????Vikram Budhraja a consultant retained by Davis to negotiate deals wit= h=20 generators said the report represents a work in progress. He said the=20 state may yet sign new contracts. ?????However Wolak said the contract figures confirm what he and others ha= ve=20 been dreading: that summer is going to be rife with rolling blackouts unles= s=20 serious steps to cut demand are taken immediately. ?????Wolak and other experts say large industrial customers must be switche= d=20 to real-time meters and pricing to persuade them to use the bulk of their= =20 energy at times of low demand. ?????The head of the Energy Foundation a San Francisco-based nonprofit tha= t=20 promotes sustainable sources of power made the same proposal to Davis on= =20 Wednesday. ?????The government need not ask customers to swelter in the dark this=20 summer foundation President Hal Harvey argued in a letter. ?????He also proposed a crash campaign to boost sales of efficient applianc= es=20 and lightbulbs. He said the state needs to take over the utilities' contrac= ts=20 with alternative energy providers to ensure they stay in business and sign= =20 new contracts for 1500 megawatts of new wind power--the cheapest fastest= =20 and cleanest source of new supply. ?????Davis had proposed a formula Tuesday to force private utilities to pay= =20 the alternative producers some of which have not been paid since November.= =20 But some of them warned Wednesday that Davis' plan offers them little=20 incentive to turn on their generators. ?????Alternative energy producers supply more than a quarter of the=20 electricity consumed in California. ?????Many producers generate electricity from wind sun and geothermal=20 sources. But most of them generate power using natural gas--and the cost of= =20 natural gas has been soaring. Several natural gas users said Davis' plan= =20 which caps rates won't cover their fuel costs. ?????Davis assumes that the price of natural gas will fall. But small=20 generators say they don't have sufficient purchasing power or sophisticatio= n=20 to gamble on future prices. ?????The Public Utilities Commission is expected to approve Davis' proposal= =20 next week. It offers producers two choices: 7.9 cents a kilowatt-hour if th= ey=20 agree to supply power for five years or 6.9 cents a kilowatt-hour over 10= =20 years. ?????The price of natural gas is higher than that said Marty Quinn=20 executive vice president and chief operating officer of Ridgewood Power LLC= =20 which owns three natural gas-fired co-generation plants. If we operate=20 we'll lose money. ?????Ridgewood is not operating having been cut off by gas suppliers. The= =20 company sued PG&E last month seeking overdue payments and release from its= =20 contracts with the utility. ?????A hearing is scheduled in El Centro today in another lawsuit filed by = a=20 small energy producer an Imperial Valley geothermal producer that sued=20 Edison for refusing to let it break its contract and sell on the open marke= t.=20 CalEnergy says Edison owes it about $140 million for energy sold since=20 November. ?????A company spokesman Jay Lawrence said CalEnergy was going ahead with= =20 its suit despite Davis' proposal. We've had promises before he said. ?????In other developments: ?????* A federal judge in Sacramento on Wednesday ordered Reliant Energy of= =20 Houston a major producer to continue selling power to California during= =20 emergencies despite the company's argument that it may not be fully=20 reimbursed. The order will remain in effect for 60 days or until the U.S.= =20 Federal Energy Regulatory Commission decides a related case. ?????* Connell said the state budget surplus has shrunk to $3.2 billion=20 because the state has spent roughly $2.8 billion on electricity. She=20 criticized the administration for withholding basic information about state= =20 finances and said she will begin an audit on Monday of the Department of= =20 Water Resources which is responsible for purchasing power. ?????Davis' aides said Connell took her action because the Democratic=20 governor endorsed one of Connell's foes this week in the race for Los Angel= es=20 mayor former Assembly Speaker Antonio Villaraigosa. A Connell aide scoffed= =20 at the notion. ?????* Sen. Dianne Feinstein (D-Calif.) said she never has had a response= =20 from President Bush after writing him last month for an appointment to=20 discuss the California energy crisis. ?????In a wide-ranging lunch talk with reporters in Washington she deplore= d=20 the fact that huge huge profits are being made in the California crisis= =20 and said an appropriate federal role would be to guarantee a reliable=20 source of power until the state can get nine new generators online. ---=20 ?????Times staff writers Mitchell Landsberg in Los Angeles and Robert L.=20 Jackson in Washington contributed to this report. --- --- ------------------------ --- --- ------------------------ Net Complex A Dilemma For San Jose=20 SERVER FARM: Plant would tax grid=20 David Lazarus Chronicle Staff Writer Thursday March 22 2001=20 2001 San Francisco Chronicle=20 URL:=20 /22/M N236772.DTL=20 San Jose while trying to block construction of a new power plant is set t= o=20 approve a vast computer complex that could overwhelm California's already= =20 strained power grid.=20 City officials gave preliminary approval last week to what would be the=20 world's largest server farm. The sprawling facility to handle Internet=20 traffic would drain about 150 megawatts of power from the state electricity= =20 grid.=20 If granted final authorization on April 3 the $1.2 billion project would a= dd=20 the equivalent of about 150000 homes to California's power system which w= as=20 hit this week by rolling blackouts as demand for juice outstripped availabl= e=20 supply.=20 The server-farm issue highlights a vexing dilemma for the state.=20 On the one hand Gov. Gray Davis is calling for widespread conservation to= =20 help California overcome its current troubles. On the other no one wants t= o=20 curtail growth of the high-tech industry which is an engine for economic= =20 vitality.=20 San Jose will make a lot of money from this project said Craig Breon=20 executive director of the Santa Clara Valley Audubon Society. But to not= =20 help the state out of its energy situation there's a fair amount of=20 hypocrisy going on.=20 The server farm would be owned by U.S. DataPort a San Jose data-management= =20 firm. As planned it would occupy 10 buildings on more than 170 acres in th= e=20 city's Alviso area.=20 Total projected energy use would be 180 megawatts. About 30 megawatts would= =20 be generated by a small on-site facility and the rest would have to be=20 provided by Pacific Gas and Electric Co.=20 We're confident that the DataPort project will be approved because it's ve= ry=20 important to San Jose and to the local economy said San Jose Mayor Ron=20 Gonzales.=20 But PG&E already is saying that its power cupboard is bare. The utility do= es=20 not have sufficient existing electric infrastructure to meet U.S. DataPort= 's=20 needs it said in a recent letter to San Jose officials.=20 John Mogannam U.S. DataPort's senior vice president of operations counter= ed=20 that it could take as long as five years for the server farm to grow big=20 enough to require the full 150 megawatts from the state grid.=20 Hopefully by then the whole energy crisis will pass by and we won't have= a=20 problem he said.=20 Mogannam stressed the positive aspects of the project such as its ability = to=20 handle about 15 percent of global Internet traffic the 700 jobs it would= =20 create and the $70 million over 10 years it would generate for San Jose in= =20 property and utility taxes.=20 That's why the city likes it he said.=20 Indeed San Jose officials are so enamored with such developments that they= =20 have all but turned a deaf ear to warnings that the server farm will=20 exacerbate California's already dire power shortage.=20 Andrew Crabtree the city's senior planner said the planning commission ha= d=20 barely touched the question of energy supply when it approved the server fa= rm=20 last week.=20 It wasn't incumbent on the commission to solve the state's energy-supply= =20 problems he said.=20 Rather San Jose city planners focused on the environmental ramifications o= f=20 the proposed facility including air pollution from diesel generators and t= he=20 impact on nearby wildlife.=20 How it would affect dozens of burrowing owls in the area was a key topic of= =20 discussion.=20 We all recognized that there's a power shortage Crabtree said. But we= =20 couldn't do anything about that with this project.=20 Except to make things tougher of course.=20 Server farms run 24 hours a day seven days a week. They are an aspect of t= he=20 high-tech boom that was never foreseen by energy experts and which are now= a=20 major contributor to California's surging electricity demand.=20 A server farm essentially is a large building filled with computers. Each= =20 computer handles the Web site or Internet traffic for hundreds of corporate= =20 clients that do not have the technical resources to look after such things= =20 in- house.=20 Most server farms consume between 10 and 60 megawatts of power. At 180=20 megawatts the U.S. DataPort facility is billed as the most extensive data= =20 center on the planet.=20 There won't be another this size anywhere in the world said Mogannam th= e=20 company's senior vice president. This will be the biggest.=20 With such a vast scale however comes additional concerns. For example al= l=20 that hardware will generate huge amounts of heat requiring powerful air=20 conditioners running around the clock to keep things cool.=20 Patrick Dorinson a spokesman for the Independent System Operator which=20 oversees California's electricity network said server farms had a big=20 impact on the state's tight energy supply.=20 We have an economy that's increasingly based on delivery of information = he=20 observed. We certainly need to make sure we're building adequate generatio= n=20 and transmission to get it there.=20 As it stands no major power plants have been built in California for the= =20 past 12 years while dozens of server farms have sprung up throughout the= =20 state.=20 The Yankee Group a Boston consulting firm estimates that the amount of=20 space taken up by server farms nationwide rose to 9 million square feet fro= m=20 1999 to 2000.=20 By 2003 it expects that figure to increase to 25 million square feet or= =20 enough room for more than a hundred 10-story office buildings.=20 San Francisco may be the exception. Supervisor Sophie Maxwell proposed=20 interim zoning controls last week that would require server farms to receiv= e=20 special permission from City Hall to operate.=20 San Jose for its part has no such reservations. It does however draw th= e=20 line at big fat power plants in the backyard of the city's leading corpora= te=20 citizen.=20 Gonzales is spearheading opposition to a proposed 600-megawatt generating= =20 facility in Coyote Valley because of its proximity to a residential area at= =20 the site of a planned Cisco Systems office complex.=20 There's plenty of opportunities to generate power in the city he said.= =20 This project is just in the wrong site.=20 The matter is now in the hands of the California Energy Commission which i= s=20 expected to issue a ruling by May.=20 Cisco critics say twisted the mayor's arm to fight the plant because it d= id=20 not want a generating facility in its neighborhood. The area will be home t= o=20 thousands of well-heeled tech workers.=20 It's politics said Breon at the Audubon Society. City officials are=20 making political decisions rather than good planning decisions.=20 Ted Smith executive director of the Silicon Valley Toxics Coalition a=20 grassroots organization is calling for a moratorium on construction of all= =20 new server farms in the South Bay until sufficient power can be found to ke= ep=20 them running.=20 Until they figure out how to build these things without draining the=20 electricity grid even dryer it is they shouldn't build them he said.=20 The Internet industry is creating unintended consequences that will really= =20 screw up our future Smith added. They are so busy focusing on next=20 quarter's profits that they don't stop and think about the consequences. .= =20 .=20 SOME FAST FACTS ABOUT 'SERVER FARMS' .=20 -- What are they? Server farms are facilities dedicated exclusively to=20 housing powerful computers for Internet use.=20 -- Who uses them? Companies and individuals pay server farms to maintain=20 their Web sites handle Net traffic and store vast amounts of data --=20 functions that otherwise would require extensive hardware and technical=20 support.=20 -- Why do they use them? As Internet use explodes server farms play an=20 increasingly vital role in managing data and keeping information moving.=20 -- What's the problem? Server farms drain considerable amounts of electrici= ty=20 to keep running.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- Contracts Won't Meet Summer Demands=20 DETAILS: 2004 before full impact felt=20 Lynda Gledhill Chronicle Sacramento Bureau Thursday March 22 2001=20 2001 San Francisco Chronicle=20 URL:=20 /22/M N230640.DTL=20 Sacramento -- Long-term power contracts negotiated by the state won't cover= =20 California's entire demand for electricity until 2004 according to newly= =20 released details about the agreements.=20 The information suggests that California might have to scrounge for=20 electricity on the high-priced spot market for a couple more years even as = it=20 continues to push conservation efforts and construction of more generating= =20 plants.=20 Details of the agreements released by Gov. Gray Davis' administration show= =20 that the contracts will provide for just over a third of the state's demand= =20 for power this year. Energy secured by the contracts will grow to meet the= =20 expected demand in three years.=20 Short-term purchases of power have at least temporarily depleted the state'= s=20 budget surplus and have raised the possibility of sharp rate increases=20 sometime in the future for electricity customers.=20 Davis administration officials are banking on the hope that conservation=20 efforts and increased generating capacity will cover the shortfall along wi= th=20 purchases of electricity on the spot market.=20 We're facing an extreme challenge still this summer said Severin=20 Borenstein head of the University of California at Berkeley Energy=20 Institute. Signing contracts doesn't create more electricity.=20 The information released did not include the names of companies that the=20 state has signed contracts with or the purchase prices.=20 The sketchy details did not satisfy frustrated lawmakers who said many=20 questions remain especially how much the state will end up paying under th= e=20 terms of the contracts.=20 The fundamental question is how much is it costing the state of California= =20 to keep the lights on said Assemblyman Tony Strickland R-Thousand Oaks.= =20 What we really need is total disclosure.=20 The state started buying power in January after generators began refusing = to=20 provide electricity to the state's investor-owned utilities. Pacific Gas an= d=20 Electric Co. and Southern California Edison say they have more than $13=20 billion in past debt.=20 The state has been spending $49 million a day on power purchases since Jan.= =20 17 according to documents obtained by The Chronicle last week.=20 Those documents said the average price of the contracts across 10 years is= =20 $69 per megawatt hour including summer peak. The five-year average price i= s=20 $79 per megawatt hour.=20 According to one chart provided by the governor's office yesterday the=20 long-term contracts will fall about 35 million megawatt hours short in 2002= .=20 Based on the average price per megawatt hour the state has been paying sinc= e=20 January that could end up costing between $6.6 billion and $13 billion.=20 The law creating the state purchasing authority allowed purchases up to $10= =20 billion and extends until 2003.=20 The governor's office said 21 contracts have been signed and another 23=20 agreements that have been reached but not yet signed.=20 Several generators have said that they will not sign contracts with the sta= te=20 until the back debt by the utilities has been taken care of.=20 We have some real potential problems said Senate President Pro Tem John= =20 Burton D-San Francisco.=20 Strickland and several media outlets including The Chronicle have filed= =20 public information requests to get more information about the prices of the= =20 contracts from the administration.=20 Releasing the information would jeopardize the negotiations for future=20 contracts said Steve Maviglio Davis' spokesman.=20 Lawmakers also frustrated by the lack of information given out by the Davi= s=20 administration were not given notice that the information was coming and= =20 many said it was lost in their mail pile.=20 The cover letter was on Los Angeles Department of Water and Power letterhea= d=20 not that of the administration. The letter was written by S. David Freeman= =20 head of the Los Angeles system who was on leave for the month of February t= o=20 help the state negotiate the contracts.=20 Assemblyman George Runner R-Lancaster said the ambiguity of the=20 information raises more questions than it answers.=20 It's like watching a parade through a peephole he said. He's showing us= =20 another float but I don't know what the parade looks like.=20 Blaming the state's purchases of electricity Controller Kathleen Connell= =20 said yesterday that the state's cash on hand had fallen from $8.5 billion i= n=20 January to $3.2 billion. Connell ordered an audit of the state's power=20 buying.=20 Connell said she would block a transfer sought by the Davis administration = of=20 $5.6 billion from the general fund to the state's emergency reserve account= =20 claiming it would lead to a ''serious cash flow crisis.=20 The transfer however is not related to the energy crisis. The sum=20 represents a routine rollover of unspent money from the previous fiscal yea= r.=20 State law requires that money to be sent to a special reserve account for= =20 emergencies.=20 Davis officials acknowledged that $3.7 billion in energy purchases have had= =20 an impact on state coffers but they say the state will be repaid once bond= s=20 are issued in the coming weeks. They also said the state typically has its= =20 lowest cash reserves at this time of year. That changes in mid-April when a= =20 flood of income tax revenue pours in.=20 The transfer has nothing to do with energy purchases said Sandy Harrison= =20 a spokesman for the Department of Finance.=20 It's not helpful to ratepayers taxpayers and people who want their lights= =20 to stay on to have the issue muddied with this sort of inaccurate innuendo= =20 Harrison said.=20 In other developments yesterday:=20 -- After two days of statewide rolling blackouts power grid managers avoid= ed=20 outages. Demand was lower because of cooler temperatures around the state a= nd=20 supply increased as several power plants completed repairs.=20 -- A federal judge in Sacramento ordered a major power generator to continu= e=20 supplying power to California. Reliant Energy Services Inc. had insisted th= at=20 it should not be forced to sell to debt-heavy utilities unless the state=20 guaranteed the bills.=20 Chronicle staff writer Greg Lucas contributed to this story. / E-mail Lynda= =20 Gledhill at lgledhill@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- ----------------- California overcharged $5.5 bln for wholesale power=20 SACRAMENTO Calif. (AP) -- Electricity wholesalers overcharged California= =20 $5.5 billion over the past 10 months according to a report by managers of= =20 the state's power grid.=20 The five companies among other things frequently offered electricity at= =20 prices double what it cost them to produce concludes the California=20 Independent System Operator study which was published Thursday in the Los= =20 Angeles Times.=20 ``All overcharged but some excessively and some by moderate amounts'' sai= d=20 Anjali Sheffrin the ISO's director of market analysis.=20 The Times said the ISO planned to file the study with federal regulators=20 Thursday and are demanding that the money be paid back.=20 The companies denied the allegations adding they expect the Federal Energy= =20 Regulatory Commission will determine their prices were justified.=20 The commission has recently stepped up its scrutiny of power companies'=20 behavior during California's power crisis asking suppliers to justify $124= =20 million in sales during the first two months of the year or refund the mone= y.=20 Critics claim thousands of additional questionable sales are not being=20 challenged.=20 The ISO study alleges the wholesalers manipulated the market by bidding at= =20 excessive prices effectively withholding supplies or by not bidding at al= l=20 when they had generation capability available.=20 California has been spending about $45 million a day -- $4.2 billion since= =20 January -- to purchase power for Pacific Gas and Electric Co. and Southern= =20 California Edison. Both utilities the state's largest have been cut off b= y=20 electricity wholesalers because their credit is almost worthless.=20 State Controller Kathleen Connell said Wednesday that the state's=20 power-buying is gutting its budget surplus. Since the state started making= =20 emergency power buys the surplus has fallen from $8.5 billion to about $3.= 2=20 billion she said.=20 A federal judge issued a preliminary injunction Wednesday ordering a major= =20 electricity wholesaler Reliant Energy Services to continue selling to=20 California despite its fear that it will not be paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant stopped selling power to the ISO which buys it= =20 at the last minute on behalf of utilities to bolster supplies and try to fe= nd=20 off rolling blackouts.=20 Such blackouts hit the state twice this week. On Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts.=20 Standard & Poor's has put the state on a credit watch due to its power=20 purchases and chastised Gov. Gray Davis the Legislature and state regulato= rs=20 for not taking more aggressive steps to make sure the utilities can pay the= ir=20 bills.=20 Edison and PG&E say they are nearly $14 billion in debt due to soaring=20 wholesale power costs. The state's deregulation law blocks them from=20 recovering the costs from customers.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She said she would refuse to transfer $5.6 billion into a ``rainy day fund'= '=20 she said was set up to impress Wall Street as the state prepares to issue $= 10=20 billion in revenue bonds to cover its power buys. Transferring the money=20 would leave the state general fund $2.4 billion in debt Connell said.=20 She called the scope of the proposed transfer unprecedented and said it=20 amounted to a ``shell game'' that disguises the power purchases' effect on= =20 the state budget.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routin= e=20 and required by law. They put the state's budget surplus at $5.6 billion.= =20 ``The law says she has to do it. The law does not give her the power to=20 demand that kind of audit information'' Harrison said.=20 Harrison said the state's budget isn't in danger because it will be repaid= =20 with the revenue bonds.=20 Connell's criticism of Davis a fellow Democrat won support from Assembly= =20 Republicans and Secretary of State Bill Jones a Republican who may challen= ge=20 Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 ``Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency'' he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers. --- --- ---------------------------- If the power goes off=20 Thursday March 22 2001=20 For most of us rolling power blackouts are a nuisance. For some people it= =20 could mean life or death.=20 In Laguna Hills cancer patient Ruben Marquez said the blackout interrupte= d=20 and prolonged his dialysis treatment. He was unharmed the Register report= ed=20 on Monday's blackouts which hit about 1.2 million Californians including= =20 100000 Orange County homes and businesses.=20 What can people do to prevent disaster?=20 They and their families should have a backup plan Rebecca Long=20 spokesperson for the Orange County Red Cross told us.=20 The Red Cross recommends in general that you plan for this as you would fo= r=20 any disaster making sure you have battery-operated radios and flashlights.= =20 We do not recommend candles for an emergency because of the fire hazard.= =20 She recommended a Web site: www.prepare.org People with special health needs such as electric-powered respirators and= =20 oxygen machines also should register with the power company. There's a whole classification for such persons with health needs Southe= rn=20 California Edison spokesperson Clara Potes-Fellow told us. The list is for us to alert them that the power could be discontinued. The= y=20 arrange to have power through other means batteries or generators. We=20 recommend that they have a battery backup of eight hours. Therefore if the= =20 rotating outages are one hour they will have plenty. Even though the power company has such people's names she said we don't= =20 inform them in advance because we have just minutes from when the Independe= nt=20 System Operator which directs where the electrons go orders Edison to=20 implement a power outage on the grid Edison owns. By the time it took to= =20 call people the outage would be over. What's the problem at the ISO? We notify as best we can Pat Dorinson IS= O=20 director of communications told us.=20 The object is to keep the lights on. Sometimes it's just a moment's notice= =20 before a blackout. It makes [giving more notice] pretty difficult. We're= =20 looking into ways to make the system better.=20 In the meantime citizens will have to keep taking precautions. We can't help noting that free market pricing instead of politically-drive= n=20 prices would much more likely make electricity available albeit at higher= =20 prices.=20 We would expect too there would be hardship allowances donations and=20 level-pay plans to accommodate various types of needs. --- Socialized electricity=20 Thursday March 22 2001=20 Government control of state power won't add one watt for consumers' use TOM MCCLINTOCK Sen. McClintock R-Thousand Oaks represents the 19th state Senate District= =20 in the state Legislature.=20 In a city where bad ideas never die Sacramento is once again host to a=20 variety of plans for the government takeover of California's power system.= =20 The private sector it is said has done such a terrible job of providing= =20 electricity that government must now step in to save the day. Thus the=20 Legislature is awash in proposals to spend billions of dollars of public=20 money to acquire existing power facilities. Fifteen billion dollars has=20 already been authorized for this purpose and an additional $10 billion is= =20 pending in the Senate.=20 Meanwhile Gov. Davis is losing about a $1.5 billion a month day-trading in= =20 the electricity market. The irony is that after the expenditure of as much = as=20 $25 billion for public power'' not a single inch will have been added to= =20 the transmission lines nor a single watt to the generating capacity of=20 California. The root of California's crisis is a catastrophic shortage of electricity. = In=20 a shortage prices rise or blackouts occur. To reduce prices and avoid=20 blackouts the only permanent solution is to increase the supply. Merely=20 changing the ownership of existing facilities leaves Californians with=20 exactly the same shortage only billions of dollars the poorer for it.=20 Government takeover advocates argue that at least a government power=20 authority will protect consumers against price gouging and poor management.= =20 Unfortunately government power authorities don't insulate against price=20 gouging. The biggest price gouger in this entire crisis has been the Los=20 Angeles Department of Water and Power which was generating electricity for= =20 $51 per megawatt hour and selling it back to California ratepayers for as= =20 much as $1400.=20 Nor does a government takeover assure better management. Just a few years= =20 ago the LADWP was buried in $7 billion in debt. The Sacramento Municipal= =20 Utilities District was a managerial laughing stock having squandered=20 hundreds of millions of dollars for a nuclear plant it barely used. Say what you will'' the government takeover advocates reply when push= =20 came to shove the municipal utility districts of California are in great= =20 shape while the private utilities are a basket case.'' But one needs to lo= ok=20 at the reason. Ever since the state reorganized the electricity market in= =20 1996 the municipal utility districts were allowed to trade in a free marke= t=20 while the private utilities were forced to buy power exclusively in a=20 Soviet-style power exchange where the highest bid during an hour set all=20 prices. The municipal utilities were able to retain their generators. Government=20 forced the private utilities to sell theirs. The municipal utilities were= =20 able to enter into long-term contracts. Government prevented the private=20 utilities from doing the same thing. The municipal utilities were able to= =20 negotiate the lowest prices available for power. Government forced the=20 private utilities to pay the outlandish prices on the government's power=20 exchange. The municipal utilities were allowed to adjust their rates to=20 reflect the actual cost of power to consumers. Government forced the privat= e=20 utilities to sell at astronomical losses. The final argument is simply an ideological one: that power is just too=20 important to be left in private hands. Really? Food is a great deal more=20 important and private hands have kept this nation well fed for centuries.= =20 Picturing the Department of Motor Vehicles running the local supermarket=20 should sober even the most euphoric of the government takeover advocates. California's Independent System Operator is predicting a 6000-megawatt=20 shortfall this summer. When there is no electricity on the transmission=20 lines it really won't matter who owns them. During the hottest hours of th= e=20 hottest days of the year when as many as 6 million homes are without=20 electricity it may begin to dawn on most people that socialism doesn't wor= k=20 any better in California than it did in the Soviet Union. --- --- ------- NEWS=20 Bush's Energy Policy Will Backfire Feinstein Warns / She wants federal pri= ce=20 controls now Carolyn Lochhead 03/22/2001=20 The San Francisco Chronicle=20 FINAL=20 Page A.3=20 (Copyright 2001)=20 Sen. Dianne Feinstein D-Calif. warned yesterday that when blackouts=20 intensify in California this summer the pressure will intensify on the Bus= h=20 administration to explain why it rejected price controls on wholesale=20 electricity.=20 If by this summer California is as anticipated facing these blackouts a= nd=20 the federal government won't help I don't think the American people are=20 going to be very pleased Feinstein told California reporters.=20 Asked if help means the cost-based price controls Feinstein is pushing she= =20 said Right now yes.=20 Feinstein said California Democrats will begin to escalate their criticism = of=20 the administration predicting that support will build among Western senato= rs=20 for her legislation to impose price caps on wholesale electricity in exchan= ge=20 for lifting the rate cap on California consumers.=20 If it passes she said the administration is really going to have to face= =20 whether they're going to help or not help.=20 Feinstein said House Democrats from the West Coast also told her they expec= t=20 that White House inaction on price caps would help them gain seats in 2002.= =20 But she refused to speculate on the political fallout from the energy crisi= s=20 against Democrats in California .=20 Feinstein characterized Energy Secretary Spencer Abraham's adamant argument= s=20 against price controls as recalcitrant saying his statement to a Senate= =20 committee last week essentially said California 's on its own.=20 She speculated that because California is dominantly Democratic even=20 somebody like me that works across party lines is beginning to wonder if th= is=20 isn't an unnecessarily barbed stick at California .=20 White House spokesman Ken Lisaius disputed the charge saying the Bush=20 administration is doing all it can but can't control that demand is=20 outstripping supply.=20 The federal government cannot prevent blackouts but can only help at the= =20 margins in situations like this Lisaius said. The only thing that can=20 prevent blackouts is reduced demand increased supply and good weather.=20 Abraham has twice in the last week argued strongly against price controls= =20 including the cost-based ones Feinstein advocates saying they could increa= se=20 blackouts by discouraging power sales into the Western electricity grid.=20 He also said many power providers including the federal Bonneville Power= =20 Administration in the home district of Sen. Gordon Smith the Oregon=20 Republican co-sponsoring Feinstein's bill would be exempt from federal pri= ce=20 caps. Feinstein disputed that but Smith's office agreed.=20 Abraham argued that price controls would not work in part because roughly= =20 half the Western electricity market would be exempt including federal powe= r=20 marketing authorities such as Bonneville rural electric cooperatives and= =20 municipal utilities such as the Los Angeles Department of Water and Power.= =20 On another front House Republicans omitted from their budget projected=20 revenues from opening part of the Arctic National Wildlife Refuge to oil an= d=20 gas exploration.=20 A Budget Committee spokeswoman said Chairman Jim Nussle R-Iowa determined= =20 that the $1 billion in revenues from the wildlife refuge the Bush=20 administration included in its budget were not needed and that there was n= o=20 reason to put in something that controversial that some of our members don= 't=20 even like when you don't have to.=20 But Rep. Gary Miller R-Diamond Bar (Los Angeles County) said House=20 Republicans are not backing off at all from opening the wildlife refuge t= o=20 drilling. Our goal is to get it passed in the House he said saying the= =20 Budget Committee omitted the revenue projections because the drilling has n= ot=20 yet been approved.=20 PHOTO Caption: Sen. Dianne Feinstein wants to cap wholesale electricity=20 costs and end caps on con- sumer rates.=20 --- ------ Reliant Still In Power Pact Talks With Calif. DWR=20 By Christina Cheddar 03/22/2001=20 Dow Jones News Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 Of DOW JONES NEWSWIRES=20 =20 (This report was originally published late Wednesday.)=20 =20 NEW YORK -(Dow Jones)- Reliant Energy Inc. (REI) remains in discussions wit= h=20 the California Department of Water Resources to sign long-term power=20 contracts.=20 However issues regarding the creditworthiness of the agency remain said J= oe=20 Bob Perkins president of Reliant's Wholesale Division.=20 We want to be part of the solution Perkins said. At the same time Relia= nt=20 is trying to protect itself from incurring additional unpaid accounts=20 receivable he said.=20 The DWR has been buying power on behalf of California 's financially troubl= ed=20 utilities. However Reliant has yet to sign a formal agreement with the=20 agency because Reliant is concerned it won't be paid.=20 During a conference call Wednesday Perkins said he couldn't comment on a= =20 lawsuit between Reliant and the California Independent System Operator=20 because he didn't know how it was progressing.=20 Further court action on the case is expected Wednesday.=20 The lawsuit stems from Reliant's desire not to be required to sell power to= =20 California if the state won't guarantee payment. The Houston energy company= =20 is concerned that it won't be paid for power being bought by the ISO on=20 behalf of Edison International's (EIX) Southern California Edison unit and= =20 PG&E Corp.'s (PCG) Pacific Gas & Electric Co. unit.=20 To date Reliant is owed some $370 million from unpaid power sales to the= =20 utilities.=20 Much of Perkins' presentation centered on how the power crisis in Californi= a=20 emerged.=20 Using data from research firm Cambridge Energy Research Associates the=20 company discussed the imbalance between California 's power demand and its= =20 power supply.=20 Looking ahead to the summer it isn't a question of whether rolling blackou= ts=20 will occur but how many and how severe Perkins said.=20 Low hydroelectric availability loss of imported power warm weather deman= d=20 growth and plant outages could lead to a worst-case scenario in California = =20 he said adding that some estimates predict California could experience 11= 00=20 hours of power outages this summer.=20 The skyrocketing power prices in the region are a reflection of the power= =20 market's imbalance he said.=20 Reliant submitted only economically sound bids for power Perkins said. H= e=20 expects the company can document why it charged the prices it did as requir= ed=20 by regulators.=20 We have been very rigorous and very disciplined in what we have submitted= =20 Perkins said.=20 He added that retail customer price increases are one way of sending a sign= al=20 to consumers to lower consumption. He cited studies that show a 20% retail= =20 price increase could reduce consumption by 2000 megawatts. A megawatt is= =20 enough power to serve roughly 1000 homes.=20 -By Christina Cheddar Dow Jones Newswires 201-938-5166=20 --- ------ CPUC Must Address Rates In QF Repayment Order - SoCal Ed 03/22/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 (This article was originally published Wednesday)=20 =20 LOS ANGELES -(Dow Jones)- Any order from the California Public Utilities=20 Commission requiring utilities to pay small independent generators going= =20 forward must determine how that could be done within the existing rate=20 structure a spokesman for Edison International (EIX) utility Southern=20 California Edison said Wednesday.=20 The utility was responding to a PUC proposed decision that would require=20 utilities to pay small generators called qualifying facilities $79 a=20 megawatt hour within 15 days of electricity delivery. The decision will be= =20 voted March 27 by the CPUC.=20 We're still reviewing (the decision) and should have more to say in a day = or=20 two. To the extent that the commission orders us to pay going forward of=20 course we will. But it needs to address how we will pay the QFs a SoCal= =20 Edison spokesman said.=20 SoCal Edison and PG&E Corp. (PCG) unit Pacific Gas & Electric Co. are=20 struggling under nearly $13 billion in uncollected power costs due to an=20 inability to pass high wholesale power costs to customers under a rate=20 freeze.=20 Gov. Gray Davis Tuesday blasted the utilities for not having paid their QF= =20 bills in full since December. Pacific Gas & Electric Co. has made some=20 partial payments to QFs but SoCal Edison has paid nothing. Together they= =20 owe the QFs about $1 billion but the order doesn't address that debt.=20 An Edison executive said in reaction to the governor's sharp comments tha= t=20 the company simply doesn't have the money to pay creditors.=20 The root problem here is there just isn't enough money in the current rate= =20 base to pay our bills said Edison Senior Vice President of Public Affairs= =20 Bob Foster. We understand the financial distress (the QFs) face we are=20 facing financial distress ourselves.=20 The proposed PUC order would also require the state's investor-owned=20 utilities to offer the small generators five- and 10-year contracts for pow= er=20 for $79/MWh and $69/MWh respectively.=20 The QFs may be able to live with the PUC proposal but the five- and=20 10-year contract prices may be inadequate if natural gas prices at one of t= he=20 California borders are high said Jan Smutny-Jones president of the=20 Independent Energy Producers Association. Natural gas prices into Californi= a=20 are currently higher than anywhere in the country.=20 But some say the proposed decision may not be enough to prevent the QFs fro= m=20 filing involuntary bankruptcy proceedings against the utilities for the mon= ey=20 they are still owed.=20 There's still a lot of skepticism. To say our position has changed based o= n=20 the CPUC decision or the governor's announcement is not accurate. A lot sti= ll=20 has to happen said Jay Lawrence a spokesman for a renewable creditors=20 committee.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 --- ------ Calif Small Pwr Producers To Shut Plants If Rates Capped By Jason Leopold 03/22/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 Of DOW JONES NEWSWIRES=20 =20 (This article was originally published earlier Thursday.)=20 =20 LOS ANGELES -(Dow Jones)- Many of California 's independent power producers= =20 late Wednesday threatened to take their small power plants offline this wee= k=20 if state lawmakers pass legislation that would cap the rates the generators= =20 charge for electricity they sell directly to the state's three investor-own= ed=20 utilities.=20 At issue is a bill that would repeal a section of the state's Public=20 Utilities Code which links the 688 so-called qualifying facilities'=20 electricity rates to the monthly border price of natural gas.=20 Lawmakers however are poised to pass the legislation.=20 State regulators are then expected to approve a measure that would=20 restructure the fluctuating rates the QFs charge PG&E Corp. (PCG) unit=20 Pacific Gas & Electric Edison International (EIX) unit Southern Californi= a=20 Edison and Sempra Energy (SRE) unit San Diego Gas & Electric from $170 a= =20 megawatt-hour to $69-$79/MWh regardless of the price of natural gas.=20 Whereas each of the 688 QF contracts differed largely because natural gas= =20 prices are higher in Southern California than Northern California the sta= te=20 wants the QFs to sign a general contract with the utilities.=20 The cogeneration facilities which produce about 5400 megawatts of=20 electricity in the state said the rates are too low and they won't sign ne= w=20 supply contracts with the utilities.=20 For $79/MWh natural gas would have to be $6 per million British thermal= =20 unit at the Southern California border said Tom Lu executive director of= =20 Carson-based Watson Cogeneration Company the state's largest QF generatin= g=20 340 MW. Our current gas price at the border is $12.50.=20 Other gas-fired QFs said the state could face another round of rolling=20 blackouts if lawmakers and state regulators pass the legislation which is= =20 expected to be heard on the Senate floor Thursday and allow it to be=20 implemented by Public Utilities Commission next week.=20 Lu whose company is half-owned by BP Amoco PLC (BP) and is owed $100 milli= on=20 by SoCal Ed said the proposals by the PUC and the Legislature will only= =20 make things worse.=20 David Fogarty spokesman for Western States Petroleum Association whose=20 members supply California with more than 2000 MW said the utilities need = to=20 pay the QFs more than $1 billion for electricity that was already produced.= =20 =20 State Loses 3000 MW QF Output Due Of Financial Reasons=20 =20 The QFs represent about one-third or 9700 MW of the state's total power= =20 supply. Roughly 5400 MW are produced by natural gas-fired facilities. The= =20 rest is generated by wind solar power and biomass.=20 About 3000 MW of gas-fired and renewable QF generation is offline in=20 California because the power plant owners haven't been paid hundreds of=20 millions of dollars from cash-strapped utilities SoCal Ed and PG&E for near= ly=20 four months.=20 Several small power plant owners owed money by SoCal Ed have threatened to= =20 drag the utility into involuntary bankruptcy if the utility continues to=20 default on payments and fails to agree to supply contracts at higher rates.= =20 The defaults have left many of the renewable and gas-fired QFs unable to=20 operate their power plants because they can't afford to pay for the natural= =20 gas to run their units. Others continue to produce electricity under their= =20 contracts with the state's utilities but aren't being paid even on a forwar= d=20 basis.=20 The California Independent System Operator keeper of the state's electrici= ty=20 grid said the loss of the QF generation was the primary reason rolling=20 blackouts swept through the state Monday and Tuesday.=20 Gov. Gray Davis recognizing the potential disaster if additional QFs took= =20 their units offline held marathon meetings with key lawmakers Monday and= =20 Tuesday to try and hammer out an agreement that would get the QFs paid on a= =20 forward basis and set rates of $79/MWh and $69/MWh for five and 10 year=20 contracts. He also said he would direct the PUC to order the utilities to p= ay=20 the QFs for power they sell going forward.=20 After next week the QF problem will be behind us Davis said Tuesday. We= =20 want to get the QFs paid...the QFs are dropping like flies...and when that= =20 happens the lights go out.=20 But this just makes the problem worse said Assemblyman Dean Florez=20 D-Shafter a member of the Assembly energy committee.=20 I don't know how we are going to keep the lights on Florez said in an=20 interview. Many of these congenerators are in my district. They said if th= e=20 legislation doesn't change they are going offline. This compounds the issue= =20 of rolling blackouts especially now when we need every megawatt.=20 Davis who didn't meet with people representing the QFs said he was handin= g=20 the QF issue to the PUC because lawmakers failed to pass legislation that= =20 would have set a five-year price for natural gas and allow the QFs to sign= =20 individual contracts with the utilities. In addition SOCal Ed opposed the= =20 legislation saying the rates should be below $50/MWh.=20 Some renewable power producers said they aren't vehemently opposed to the n= ew=20 rate structure because it guarantees them a higher rate than what was=20 originally proposed.=20 =20 QFs Want Third Party Supply Contracts=20 =20 John Wood who represents the SoCal Ed Gas Fired Creditors Committee one o= f=20 a handful of groups that have formed since January to explore options on=20 getting paid by the utilities said his group of gas-fired QF creditors wan= t=20 to be released from their supply contracts and sell to third parties.=20 Under our plan we would be permitted to sell electricity to third parties= =20 (including the state Department of Water Resources) until a resolution to t= he=20 crisis can be accomplished wood said.=20 Hal Dittmer president of Sacramento-based Wellhead Electric in Sacramento= =20 which is owed $8 million by PG&E has 85 MW of gas-fired generation units= =20 offline.=20 Under the state's plan Dittmer said he risks going out of business.=20 I can't buy natural gas for what I would be paid under this decision he= =20 said. The state needs to quit kidding themselves that they don't need to= =20 raise electricity rates. All of this is being driven by an artificial=20 construct that California can avoid raising rates.=20 =20 -By Jason Leopold Dow Jones Newswires 323-658-3874=20 jason.leopold@dowjones.com=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: Attached are: 1. Draft comments to CAISO re: CAISO's Draft Proposal to give temporary waivers to long startup time units. Comments are due to CAISO this Friday. 2. CAISO's draft waiver proposal (for reference) 3. Outline of comments to FERC re: CAISO's implemtation filing of July 10. Hopefully these comments will be filed with a group of marketers and is due August 9 4. CAISO's July 10 filing (for reference) What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Other Aspects of Cheney Energy Report Recommendations of Interest to Enron -- Coal and Enviro Related Body:: Below is the text of recommendations taken from the summary of recommendations in the Cheney Energy Report being released later this morning that focus on coal and coal-related issues including environmental. The NEPD Group (National Energy Policy Development) recommends that the President direct the Administrator of the Environmental Protection Agency (EPA) to propose multi-pollutant legislation. The NEPD Group recommends that the President direct the EPA Administrator to work with Congress to propose legislation that would establish a flexible market-based program to significantly reduce and cap emissions fo sulfur dioxide nitrogen oxides and mercury from electric power generators. Such a program (with appropriate measures to address local concerns) would provide significant public health benefits even as we increase electricity supplies. Establish mandatory reduction targets to emissions of three main pollutants: sulfur dioxide nitrogen oxides and mercury. Phase in reductions over a reasonable period of time similar to the successful acid rain reduction program established by the 1990 amendments to the Clean Air Act. Provide regulatory certainty to allow utilities to make modifications to their plants without fear of new litigation. Provide market-based incentives such as emissions trading credits to help achieve the required reductions. The NEPD Group recognizes the importance of looking to technology to help us meet the goals of increasing electricity generation while protecting our environment. To that end the NEPD Group recommends that the President direct the Department of Energy to continue to develop advanced clean coal technology by: Investing $2 billion over 10 years to fund research in clean coal technologies. Supporting a permanent extension of the existing research and development tax credit. Directing federal agencies to explore regulatory approaches that will encourage advancements in environmental technology. The NEPD Group recomemnds that the President direct federal agencies to provide greater regulatory certainty relating to coal electricity generation through clear policies that are easily applied to business decisions. The NEPD Group recommends that the President direct the Administrator of the Environmental Protection Agency in consultation with the Secretary of Energy and other relevant agencies to review New Source Review regulations including administrative interpretations and implementation and report to the President within 90 days on the impact of the regulations on investment in new utility and refinery generation capacity energy efficiency and environmental protection. The NEPD Group recommends that the President direct the Attorney General to review existing enforcement actions regarding New Source Review to ensure that the enforcement actions are consistent with the Clean Air Act and its regulations. The NEPD Group recommends that the President direct federal agencies to support continued research into global climate change continue efforts to identify environmentally and cost-effective ways to use market mechanisms and incentives continue development of new technologies and cooperate with allies including through international processes to develop technologies market-based incentives and other innovative approaches to address the issue of global climate change. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Andy Fastow Body:: Response to Tarpey on Schnitzer/Tierney (303)575-6491 Thorn--Linda Breathitt Mont Hoyt Set up meeting with Dan Richard Rick and maureen What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Draft Post-Labor Day Legislative Plan On RTOs Body:: Attached for your review and any comments is a draft legislative action plan of initial steps to be taken on RTOs when Congress returns next week. We will also be sending this draft plan to our lobbying consultants for their input and discussion at our meeting/conference call next Tuesday afternoon. As always your input is much appreciated. John What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Follow up for Ken Body:: Rep Scott McGinnis (colo) told Ken that he would like to be briefed on the California and broader energy situation so that he can speak out on the issue. Also don't forget that we need to go see your buddy Newt! What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: EEO Letter Body:: Sorry for the delay (I had major e-mail problems). The memo looks good let's get it out. From: Sandra Lighthill/ENRON@enronXgate on 06/21/2001 05:43 PM To: Steven J Kean/NA/Enron@Enron cc: Rick Johnson/ENRON@enronXgate Subject: FW: EEO Letter Steve As you know we have developed a memo to be signed by Ken Lay and Jeff Skilling reaffirming our EEO Harassment Prevention and Fair Treatment policies for 2001. The final version is attached for your review and if acceptable to obtain the needed signatures. The memo has been reviewed by Cindy the Legal Department and the OLER group. Once signatures have been obtained return the signed memo to me so that our group can begin the distribution and posting of the memo to all US employees. Please call me at x37921 if you have any questions. The signed memo can be sent to me at EB1669c. Thank you for your assistance in this matter. Regards Sandra What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:KAMINSKI WINCENTY Email:vkamins@enron.com - 7138533848 ? Enron Wholesale Services - Office of the Chairman ? From:??Mark Frevert Chairman & CEO ??????Greg Whalley President & COO ??????Mark Haedicke Managing Director & General Counsel ? Subject:??Confidential Information and Securities Trading ? Enron Wholesale Services ('EWS') maintains official Policies and Procedures Regarding Confidential Information and Securities Trading ('Policies and Procedures') which have been revised as of November 15 2000 to reflect the new EWS structure. These policies and procedures are intended to allow us simultaneously to pursue our diverse businesses and to protect confidential information our reputation for integrity and EWS and its employees from legal liability. ? You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: ? ? You must certify your compliance with the Policies and Procedures within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Lance Schuler at extension 3-5419 Mark Haedicke at extension 3-6544 Alan Aronowitz at extension 3-3214 Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Californias dim bulbs Body:: You may have seen this when it first came out a while back ... but it's worth a rerun. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential -- Terry Thorn Body:: Shanna talk with Rick but he will be working until June or July then he will retire and be available as a consultant to us. m Shanna Funkhouser@ENRON 02/08/2001 10:09 AM To: Mike McConnell/HOU/ECT@ECT cc: Rick Subject: Confidential -- Terry Thorn Mike I wanted to let you know that Cindy Skinner passed the information she gathered on Terry to me. Please let me know what the status is with his termination ie timing etc. so that I may start the process. Thanks Shanna X59386 What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Oakland Trib Wed 3/7: Breakthrough made in rescue of PG&E Bakersfield Californian Wed 3/7: El Paso Energy closes six valley power plants Contra Costa Times Wed 3/7: Still undecided: Who'll pay DWR for electricity SF Chron Wed 3/7: State Taxpayers In Dark on Details Of Energy Deal Sac Bee Wed 3/7: Lawmakers pitch fixes for region's energy woes Orange Co. Register Wed 3/7: Power plan called wrong LA Times - Wed 3/7: Bill to Cut Some Power Prices Stalls Sac Bee Wed 3/7: PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts SF Chron Wed 3/7: PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service San Jose Mercury Wed 3/7: Power prices could soar during the summer SF Chron Wed 3/7: Power Plant Plans Cause Conflicts East county residents blast supervisors Contra Costa Times Wed 3/7: Supervisors set search for power plant sites Sac Bee Wed 3/7: Peter Schrag: California's $90 billion infrastructure gap Contra Costa Times Wed 3/7: PG&E power plan debated at hearing SF Chron Thurs. 3/8: State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August WSJ Thurs. 3/8: Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals ------------------------ Breakthrough made in rescue of PG&E State ready to pay $7 billion for lines By Steve Geissinger SACRAMENTO BUREAU SACRAMENTO -- Signaling a breakthrough in secret energy crisis talks the Davis administration disclosed Tuesday it may announce the framework of a pact to rescue the teetering Pacific Gas and Electric Co. next week. Things are going very well said Steve Maviglio a spokesman for Gov. Gray Davis. The state appears to be poised to pay at least $7 billion -- and possibly billions more -- for PG&E's high-voltage transmission lines as part of a deal to financially renovate the north-state utility according to sources familiar with the negotiations. But consumer advocates insisted that even the $7 billion price is too much to pay. And experts warned that a deal with PG&E will be more complex than with other utilities. PG&E representatives declined comment in keeping with their policy on the talks even though the Davis administration said an announcement could come as early as next week or the following week. The new timetable for an announcement was substantially sooner than in Davis' original forecast. Until late last week PG&E was still resisting the sale of its power grid despite the fact that Davis had announced the framework of an agreement with Southern California Edison. Davis expects to soon announce a similar deal with the San Diego Gas and Electric Co. However any such deal still would need federal approval. The investor-owned utilities trapped between high wholesale costs and lower regulated retail rates amassed nearly $13 billion in debts and were unable to buy electricity this winter. With the onset of rolling blackouts the state began brokering billions of dollars in emergency short- and long-term power purchases. Davis' strategy to ease the energy price and supply crisis includes bolstering both conservation and generation while fiscally refurbishing the nearly bankrupt utilities. As part of the rescue deal the utilities would have to drop legal actions seeking dramatically higher electricity bills environmentally shield wildlands they own sell power from their generators to Californians for the next decade and secure help with their debts from their parent companies. Together with the cash infusion from the sale of their power 26000-mile power grids the utilities would be allowed to sell bonds to raise funds and use customer money to pay them off. The state would upgrade the high-voltage lines and lease them back to the utilities for operation. In a reflection of the negotiations with the three utilities a Davis administration official said the deal with PG&E is proving to be more complex than with the other firms. Though PG&E finally agreed late last week to sell its transmission grid the utility apparently wants more than the $7 billion that Davis has offered according to sources. The figure is more than twice the book amount or the value placed on the system for purposes of accounting. And that's the markup that lured Edison into an agreement to sell its smaller portion of the transmission grid for $2.8 billion. But PG&E which fears an erosion of its economic base may be asking as much as $10 billion. Due to complexities in the state's 1996 deregulation of the industry PG&E is more likely to lose revenue than Edison as a result of selling its transmission lines according to experts. Big customers might be able to bypass the utility's remaining local distribution lines thereby eroding its customer base. Therefore the utility may view bankruptcy and sale of its transmission lines to the highest bidder as a potentially attractive alternative to selling its share of the grid to the state at too low a price. ---- El Paso Energy closes six valley power plants Filed: 03/07/2001 By CHIP POWER Californian staff writer e-mail: ppower@bakersfield.com El Paso Energy citing non-payment from Pacific Gas & Electric Co. said it has shut down six cogeneration plants this week. The smaller plants produced about 175 megawatts of electricity and are located primarily in the San Joaquin Valley said company spokesman Mel Scott. A megawatt can supply power to 1000 homes. At least 10 plants have closed in the past two weeks as a result of non-payment according to the state Independent System Operator which manages most of the state's electrical distribution. The El Paso Energy plants are operated with various partners and had not been compensated for December January and February deliveries said Scott. He said he did not know the total amount due but said the plants would be closed until PG&E's credit worthiness is improved. A cogeneration plant common in oil fields simultaneously produces heat energy and electrical or mechanical power from the same fuel in the same facility. Typically it produces electricity and steam which can be deployed to enhance oil recovery. Kern County is the state's leading oil-producing county. El Paso owns or has interests in more than 40000 miles of interstate and intrastate pipeline connecting the nation's principal natural gas supply regions to the five largest consuming regions in the United States namely the Gulf Coast California the Northeast the Midwest and the Southeast. El Paso closed up 99 cents on Tuesday or 1.4 percent at $71.49. The Houston-based company's stock price has ranged between $36.31 and $75.30 in the last 52 weeks. ---- Still undecided: Who'll pay DWR for electricity By Karen Gaudette ASSOCIATED PRESS SAN FRANCISCO -- The price tag is $3.2 billion and counting for electricity bought by the state Department of Water Resources for the customers of two nearly bankrupt utilities. Pacific Gas and Electric Co. Southern California Edison and the state disagree over how the DWR eventually will be reimbursed for its purchases on the expensive last-minute power market. So do the state power regulators who have the final call over who gets the money when. Under a recent law the DWR went into the electricity-buying business to help keep the two utilities from sinking further into their $13 billion debt. The state plans to retrieve the money by selling $10 billion in revenue bonds. The utilities continue to collect ratepayer dollars on that electricity which the bill's author Assemblyman Fred Keeley D-Boulder Creek says is meant to help them begin paying down their debt. In a recent letter however DWR officials requested that the state Public Utilities Commission order that a portion of that money be diverted to the state. But after the utilities subtract the costs of generating electricity payments to environmentally friendly power plants and other expenses there is no money left from ratepayer dollars to give to the DWR without sinking further into debt PG&E spokesman Ron Low said Tuesday. If it passed along money to the DWR our undercollection would grow by about $2.4 billion by the end of the year Low said. The commission unable to agree on the best course of action left the issue untouched at its last meeting but expects to revisit the issue when it meets this morning. Commissioner Richard Bilas is proposing an alternate plan that would have the DWR set its own revenue requirements that would be passed on to ratepayers. The PUC also is expected to respond to complaints from laid-off workers and customers that layoffs by utilities to cut costs have been hurting service. Commissioner Carl Wood warned at the last meeting that failure to provide safe and reliable service could mean fines for the utilities. Representatives from electrical workers unions the PUC and the utilities were to discuss the issue Tuesday afternoon. I don't think we believe that utilities can find a way out of their problems by laying off workers said Mindy Spatt a spokeswoman with the Utility Reform Network. We think consumers deserve safe and reliable service and we think they deserve it at a reasonable price. ---- State Taxpayers In Dark on Details Of Energy Deal David Lazarus Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle Few people would purchase a car simply because the dealer said ''Trust me it's a great deal.'' Yet Gov. Gray Davis essentially is telling Californians just that about dozens of long-term power contracts. Because of confidentiality agreements with power companies the governor has revealed only scant details about the state's multibillion-dollar contracts for electricity over the next 10 years. Gov. Davis has our money and we can't see how he's spending it said Doug Heller a spokesman for the Foundation for Taxpayer and Consumer Rights in Santa Monica. We've been locked out of the room. Neither Davis nor power companies would divulge specific details about the price duration or scope of individual contracts. Each cited secrecy clauses that the governor's office said had been desired by both sides. What consumers do know is this: -- California has signed 40 contracts and tentative accords valued at about $40 billion to secure enough power to light 9 million homes over the next decade. -- The average purchase price of each deal is $69 per megawatt hour -- well above the $30 to $40 charged by power generators before California's energy market went haywire last summer. -- If as is widely expected wholesale power prices fall in years ahead the state nevertheless will be locked into paying above-market rates for electricity. But it is not known which generator agreed to part with the most power at the cheapest level or the full range of the prices in concocting the $69 average. Moreover it is unclear how shrewdly the state negotiated with taxpayer money in securing power on behalf of cash-strapped utilities. These agreements are the bedrock of our long-term energy policy Davis said Monday in announcing the deals. The governor's office defended the murky nature of the contracts yesterday. It's a business transaction in which private corporate information is included said Steve Maviglio a spokesman for Davis. That's the kind of information that never gets revealed. While additional elements of the contracts will be publicized in coming months he said the contracts themselves will remain a secret. You'll never see all the details Maviglio said. This did not sit well with many observers. It's a breach of public trust said Daniel Bacon a San Francisco attorney specializing in business law. A public servant spending public money shouldn't be able to keep the spending secret. But Gary Ackerman executive director of the Western Power Trading Forum an energy-industry association in Menlo Park called confidentiality agreements a necessary evil in transactions like this. He explained that no power company would agree to a long-term contract if rival firms could learn the terms of the accord. The company would be losing too much of its competitive edge in the marketplace Ackerman said. At the same time he noted that secrecy allowed the buyer -- in this case California taxpayers -- to secure more favorable terms with individual sellers. A high price with one generator would not necessarily be sought by all power providers. Still the fact that public funds are being used makes confidentiality in this case a different matter than say Cisco Systems' quietly negotiating to take over yet another tech rival. The public is in a very awkward position said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. It has to rely on the good word and expertise of the governor and he has yet to demonstrate that he has expertise or good word in this field. Shames likened consumers to passengers in a plane being flown by a pilot without a license to fly. But what choice do we have? he asked. I don't see many other options available right now. There's the rub. No matter how bad a deal California may have cut to help meet its energy demands the alternative -- blackouts disruptions economic catastrophe -- is far far worse. On the other hand it already appears that the new contracts will not shield Californians from the threat of daily outages this summer when demand surges. Davis said only about 60 percent of the state's summertime electricity needs so far had been met. Part of the reason is that many power companies already have contracted for their output this year. Duke Energy said this was why it would not begin its nine-year contract with California until 2002 while Williams Cos. said it would only gradually increase the amount of available wattage in its 10-year contract. Both companies meanwhile will continue to profit this summer by selling into the volatile spot market where wholesale power went for as much as $1 500 per megawatt hour last year. You can't sell all your power into long-term contracts said Paula Hall- Collins a Williams spokeswoman. You save some for the spot market. Consumer groups worry that consumers will be hammered again this summer with sky-high power prices and then get nailed down the road by contracts for above-market rates. If we could look at the terms of the deals we'd see that California is being gouged for 10 years said Heller of the Foundation for Taxpayer and Consumer Rights. But the governor doesn't want us to see that. Ackerman of the Western Power Trading Forum said the state had gotten the best rates it could under current market conditions. California went for long-term contracts when everyone else moved in as well he said. Californians are paying a price for not acting sooner. ---- Lawmakers pitch fixes for region's energy woes By David Whitney Bee Washington Bureau (Published March 7 2001) WASHINGTON -- California members of Congress pleaded for everything from wholesale price caps to extending daylight-saving time an extra hour to help the region cope this summer with its persistent electricity shortage but none of the ideas seemed to catch fire at a House hearing Tuesday. People will die in California because of this crisis Rep. Brad Sherman a Los Angeles-area Republican warned the House Energy and Commerce Committee. Sherman testified that his idea for saving lives is to extend daylight-saving time by an extra hour so that there would be more daylight at the end of the day when power consumption surges. One of the peak demand periods for electricity occurs between 5 p.m. and 8 p.m. when the sun sets and people come home from work Sherman testified. If people come home and it is light out there is less of an inclination to turn a light on. Sherman said the state Legislature has called for congressional approval for states to be given authority to extend daylight-saving time and he cited analyses by the California Energy Commission and other agencies suggesting that it could cut power consumption by 1 percent to 2 percent. Sherman who was one of about a dozen California lawmakers presenting their views on the energy squeeze drew no questions from committee leaders about what his legislation might do to everything from airline schedules to television programming if West Coast states didn't agree on the same time standard. Most of the committee's questioning was on the more popular idea proposed by several California and Western lawmakers primarily Democrats to require the Federal Energy Regulatory Commission to impose caps on wholesale electricity prices that have gone wild because of a regional power shortage. Rep. Bob Filner D-San Diego charged that the price spiral has little to do with power shortages but a lot to do with a small cartel of generators bilking ratepayers. Rep. Jay Inslee D-Wash. said he brought up the idea of regional price caps with President Bush who was initially skeptical. But Inslee said that Bush warmed to the idea after being told that protections could be built into the caps so as not to discourage construction of new power plants. Upon hearing that Inslee said Bush invited him to meet with the president's Cabinet-level task force led by Vice President Dick Cheney on a national energy strategy. But Inslee said he can't get the group to meet with him. It's very disappointing Inslee said. Tuesday's hearing was part of a series the panel is holding on the California crisis so far without any emerging consensus on what if anything Congress should do. ---- Power plan called wrong Wall Street analysts say the governor's approach to the problem avoids the issue that caused the imbalance. March 7 2001 By DON THOMPSON The Associated Press SACRAMENTO California's scramble to insulate consumers from the soaring price of electricity may add to the state's power problems this summer Wall Street analysts said Tuesday. Gov. Gray Davis' emphasis on buying utilities' transmission lines and negotiating long-term power contracts to help ease their debts skirts the deep imbalance between wholesale and market rates that led to the state's power problems in the first place they said. In the long run it doesn't solve anything said Michael Worms an industry analyst for Gerard Klauer Mattison & Co. In the long run you need to send the right price signals to consumers which will create its own conservation signals. Unfortunately customers were shielded from that in California. Davis said Monday that the state's first contracts to buy electricity for two financially struggling utilities will provide only about two-thirds of the power needed on a typical summer day forcing Californians to cut power use at least 10 percent to avoid blackouts. Since early January the state has been buying one- third of the power Southern California Edison and Pacific Gas and Electric Co. customers need. The two utilities denied credit by suppliers say they have lost nearly $14 billion due to soaring wholesale electricity prices that the state's industry-deregulation law says they cannot pass on to consumers. The keepers of the state power grid had enough electricity Tuesday to avoid declaring an electricity alert but have faced an almost-daily scramble for weeks due to a tight supply and high wholesale prices. Several wholesale and retail rate proposals are circulating. Among them: Free-market advocates such as Worms want an immediate end to the deregulation-imposed retail rate freeze on Edison and PG&E that will expire next year. Davis wants a Western price cap of $100 per megawatt hour on power generators he says have been prof iteering from California's short energy supply. The Bush administration and Federal Energy Regulatory Commission are cool to that idea. In December FERC imposed a soft cap of $150 per megawatt hour on wholesale rates in the state and required suppliers to justify any higher prices they charge. Consumer groups such as The Utility Reform Network or TURN want regulated rates for residential and small-business customers but free-market rates for large industrial customers which sought deregulation in the first place. TURN also advocates a tiered rate structure with higher rates for consumers who use more than a reasonable amount of electricity each month. Assembly Republicans say electricity and natural-gas prices will fall naturally if the state increases supply mainly by making it easier to build plants and pipelines. Right now you're sort of sitting partially with regulation and part with the free market said Paul Fremont an analyst with Jefferies & Co. Both these systems work. It's sort of that in-between system that you have in Califor nia that doesn't appear to be working. The system discourages generators from building new power plants because they aren't guaranteed a profit and it doesn't do enough to discourage power use by consumers because the price they pay doesn't reflect the true cost of power Fremont said. I don't think people here have much faith in the market and why should they? countered TURN's Mindy Spatt. I think there are probably better ways of encouraging consumers to conserve than by gouging them. Davis insists the crisis can be resolved without raising rates for Edison and PG&E customers beyond the existing rate structure. In January state regulators imposed temporary rate hikes of 7 to 15 percent on Edison and PG&E customers. The Legislature and Davis extended the increases for up to a decade to help pay back the estimated $10 billion in power buying the state expects to do for Edison and PG&E over the next several years and finance its purchase of the power lines owned by the two companies and San Diego Gas & Electric. Rates were already scheduled to increase next year for Edison and PG&E customers. Under the 1996 deregulation law the pair's ratepayers saw a 10 percent rate reduction but only until early 2002. That rate cut will likely expire as planned Davis spokesman Steve Maviglio has said. Davis wants those rates to cover not only the traditional cost of generating transporting and distributing power but the added cost of paying off the two utilities' massive debt and buying their transmission lines said Assemblyman Fred Keeley D-Boulder Creek the Assembly's chief power negotiator. Yet Davis has indirectly addressed the rate imbalance by signing legislation that will let regulators raise consumer rates if necessary Keeley said. The governor and lawmakers are in effect spreading out rate increases over a decade by using long-term revenue bonds to buy power for the nearly bankrupt utilities said Severin Borenstein director of the University of California Energy Institute. At some point we have to deal with the reality that all of the power that we buy has to be paid for by somebody - it's either going to come from taxpayers or it's going to come from ratepayers Bor enstein said. Raising rates now would get us a lot of conservation. Davis also wants financial incentives for conservation and power-plant construction in time to make a difference this summer. Our mouths were agape at the rapid timetable Keeley said. Legislators are rushing to pass those incentives by month's end he said allowing three months for consumers and suppliers to act before the heat of summer. Among bills considered Tuesday the Senate Energy Committee approved legislation to accelerate the siting of power plants. It also was considering a proposal to restructure rates for generators that use renewable energy to provide about 30 percent of the state's electricity. ---- Bill to Cut Some Power Prices Stalls Energy: Democrats balk at varying payment levels for alternative generators. By DAN MORAIN JULIE TAMAKI Times Staff Writers SACRAMENTO--Legislation aimed at cutting prices for more than a fourth of the power consumed in California stalled Tuesday as Democrats questioned why a few alternative energy generators--some of them campaign donors--stood to receive higher payments than others. Lawmakers working to unravel California's energy mess have been negotiating for weeks in an effort to cut the price paid to more than 600 generators of alternative power by more than half to below 8 cents a kilowatt-hour. Those alternative generators' contracts with utilities have shot up in recent months because of a rise in the price of natural gas. The cash-strapped corporations have suspended or made partial payments to the generators over the last few months causing many to shut down or reduce their outputs. But even as the lawmakers reached agreement that pushed the average price to near the 8-cent level per kilowatt-hour some generators would have received higher prices under the bill by state Sen. Jim Battin (R-La Quinta). Some of the generators that stood to benefit had donated to Battin's campaigns. One--Windtec Inc.--gave Battin a $20000 campaign donation in 1999. Others contributed from $3000 and $5000 last year. Battin acknowledged that he has received campaign contributions from some wind power generators but said there is no connection between the donations and the bill's provisions. It is illegal it is unethical and it's not how I do business he said. Battin noted that 25% of the state's alternative energy producers are in his district. As Democrats on the Senate Energy Committee blocked the bill Battin warned that some alternative energy producers might react to the delay by trying to force Southern California Edison and Pacific Gas & Electric into bankruptcy. We will be the cause of bankruptcy Battin said. That prompted Energy Committee Chairwoman Debra Bowen (D-Marina del Rey) to retort: I'm really tired of being threatened with bankruptcy. Alternative energy producers including those that use wind solar power biomass and other means produce 27% of the energy used in California. They sell the electricity to the utilities which in turn transmit it to retail consumers. But with the utilities facing multibillion-dollar debts the alternative energy producers under contract with Edison have not been paid since November. Scores of alternative energy producers supported the measure. Edison International and the San Francisco-based consumer group the Utility Reform Network opposed it. Michael Florio of the Utility Reform group said the deal could result in higher consumer prices an Edison representative said the same thing. Battin and Assemblyman Fred Keeley (D-Boulder Creek) worked out an arrangement with many of the generators. Keeley took the lead in the early negotiations and then turned to Battin to introduce the legislation SB 47X. Rather convoluted language would have allowed higher payments to a select few generators that produce electricity from wind and biomass. Most of California's wind suppliers for instance would have received about 6 cents per kilowatt-hour. But a handful of them about half a dozen wind farms--mostly in the Palm Springs area represented by Battin--would have received 7.8 cents. Battin contends that other wind producers receive additional payments that boost them to the same level as Windtec and others that would get the higher payments. They get the same deal Battin said of the handful of generators that would benefit from the provisions he added to the bill. In California's overall energy market the amount of money that would have flowed to the favored generators is minor. But the added prices that would have been paid to the generators would have translated to at least $19 million in the next five years to be absorbed by Southern California Edison customers according to one analysis. Also Tuesday more details were disclosed about another leg of the state's effort to escape from the energy crunch--the deals with large power generators to supply electricity to California for as long as 10 years. Those arrangements were announced by Gov. Gray Davis Monday as the bedrock of California's energy policy. But some consumer advocates warned that the deals could lock the state into excessively high-priced contracts. S. David Freeman the general manager of the Los Angeles Department of Water and Power and Davis' negotiator said that the state guarded against that by varying the time spans of its deals. About 6000 megawatts are expected to be available this summer about one-third of the energy needed by the state Freeman said. The amount of power under contract swells until more than 9000 megawatts are contracted in 2004 half of the needed amount before dipping to 8000 megawatts in 2010. What we're doing here is what everybody said had to be done Freeman said. We deliberately bought 50% so we'd have a good mix between long-term contracts which may turn out to be somewhat higher or somewhat lower than the spot market and purchases on the spot market. ---- PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts By Carrie Peyton Bee Staff Writer (Published March 7 2001) Sacramento's electric utility wants out of a deal that imposes rolling blackouts locally on PG&E's command. So do a lot of other utilities. They've been writing letters lobbying lawmakers and launching informal talks with Pacific Gas and Electric Co. to get off the hook before summer. Who dodges the blackout bullet is going to play out as a political hot button around the state said George Fraser head of the Northern California Power Agency a coalition of municipal utilities. In Sacramento the next volley is expected soon with the Sacramento Municipal Utility District reportedly poised to notify PG&E that it will no longer black out homes and businesses on the larger utility's command. We are absolutely trying to fight off the requirement for rolling blackouts for the Sacramento area said Linda Davis one of seven elected members of the SMUD board of directors. Saying they don't want to be dragged down by somebody else's problems two Southern California utilities have written grid operators asking to be exempted from any blackouts caused by PG&E's or Southern California Edison's financial woes. But in PG&E's view California is in an energy crisis (and) ... we're all in this together said spokesman John Nelson. The maneuvering comes amid bleak forecasts for power supplies this summer. Although Gov. Gray Davis has said conservation new power plants and moderate weather could avert blackouts officials at the Independent System Operator which runs much of California's grid expect frequent rotating outages. One consulting firm Cambridge Energy Research Associates predicts 20 hours of rolling blackouts during July and August and about 200 hours of especially intense calls for voluntary cutbacks. Before blackouts hit the jockeying over just whose lights air conditioners and assembly lines will be shut down is growing. The outcome could affect millions of people statewide. The state Public Utilities Commission is probing rolling blackout programs run by the for-profit utilities it regulates including PG&E and Edison. A PUC analysis has suggested that PG&E's program which currently exempts about 40 percent of its customers should spread the burden more broadly. For example it said 1.9 million homes and businesses are spared just because they share a circuit with a customer deemed essential. But not-for-profit utilities such as SMUD which answer to their own elected boards or city councils have other worries. Many have already lined up their power supplies for summer. Some have raised rates or are considering raising rates. Some have taken extra conservation steps. They think those preparations ought to give them leverage to ease blackout clauses in their contracts with PG&E. SMUD general manager Jan Schori is going to use every avenue ... any avenue to put pressure on including lobbying the ISO the governor and others said utility director Davis. The Northern California Power Agency a joint-powers authority that owns and operates power plants for municipal utilities has begun informal negotiations with PG&E to change blackout rules according to Fraser its top executive. It is preparing to write PG&E asking that its members be exempted from outages altogether. Failing that it wants them to face fewer outages or to be compensated for cutting off power he said. At SMUD the utility board has met in closed session to discuss exactly what it is required to do during electric emergencies under terms of the interconnection contract that links SMUD's lines to PG&E's. The contracts are being inspected with a fine-tooth comb said SMUD director Howard Posner. Schori declined to comment on any specifics. Sources indicated that the main option being considered is notifying PG&E that because of changed circumstances SMUD believes it no longer is required to routinely comply with outage requests. Other options being explored include re-negotiating existing agreements with PG&E. Posner said that ever since two days of rolling blackouts in January constituents have been asking him 'Why are we participating when we're not the problem?' And I don't have a good answer to that. Several directors said SMUD has already spent a lot of money -- and is considering 16 percent rate increases -- to ensure that it has enough electricity under contract to meet its customers' summer demands. They believe PG&E should do the same. We're almost like a David against Goliath here said board vice president Genevieve Shiroma. The huge investor-owned utilities next door have severe problems that they need to get under control. In addition SMUD plans to argue that because it can cut usage through its Peak Corps program which remotely turns off air conditioners at volunteer households it has already done its part without rotating outages director Davis said. PG&E believes the interconnection agreements that govern smaller utilities' ties to its transmission lines have benefits and burdens to both sides said Nelson. It wouldn't be fair or good policy for just one provision to be altered without taking a look at how that affects the entire contract he said. Interconnection contracts generally have clauses that require utilities to help each other out to avert greater emergencies. Sometimes reducing demand -- called load shedding -- can be the only way to stabilize the electric grid in the seconds after a major power plant or transmission line fails. It's been around in the electrical fabric forever said Jim Pope head of Silicon Valley Power Santa Clara's city-run utility. In addition to legal requirements you have a moral obligation so you don't bring the system to collapse. Like other city-run utilities Silicon Valley Power has a contract with PG&E that requires it to shed load during an electric emergency. But its contract allows it to work with big users to reduce their demand so no one has to be completely shut off. Such agreements formed long before deregulation when PG&E ran the north state's grid now are complicated by the 1997 creation of the state Independent System Operator. The ISO today runs pieces of the grid owned by PG&E Edison and San Diego Gas & Electric Co. If it believes power use is about to surge past supply potentially triggering a grid collapse across the western United States the ISO notifies the three utilities that they have to shed a certain number of megawatts. The big utilities meet that requirement two ways. They cut circuits to some of their own customers and they tell smaller connected utilities to cut a proportionate share. In Northern California about 80 percent of the outages are borne by PG&E customers and the rest by customers of SMUD and other municipal utilities and irrigation districts. In one sense we are all in this together. If SMUD were in danger of going down we would hope others would help us out said SMUD's Posner. But that's if we're in danger from circumstances beyond our control not from mismanagement or lack of financial wherewithal. It is unclear what penalties if any a utility would face for violating an interconnection agreement. In the long run the issue would be fought either in the courts or before the Federal Energy Regulatory Commission grid officials said. As a practical matter in the seconds when the risk to the grid is greatest if one utility refused to shed load the ISO would probably solve to problem by calling on PG&E Edison or others who are willing to make deeper cutbacks they said. ---- PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service Bernadette Tansey Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle State regulators are set to decide today whether debt-ridden Pacific Gas and Electric Co. and Southern California Edison can conserve cash by laying off thousands of workers and letting service standards slip. Union officials who protested the layoffs before the California Public Utilities Commission warn that if the cuts go through neighborhoods hit by power outages could stay dark for hours and more customers could face busy signals when they call about their bills. An administrative law judge agreed advising the commission in February to order the utilities to restore 725 positions already cut and block the elimination of an additional 2125 jobs. Judge John Wong said PG&E and Edison have acknowledged the layoffs will not substantially improve their shaky financial condition which arose from skyrocketing wholesale electricity costs the utilities could not pass on to consumers under a rate cap. The savings would barely make a dent Wong said in his draft decision. The two companies together claim that their debt from power purchases amounts to more than $13 billion. PG&E says it has saved $18 million from the first wave of 325 layoffs. Wong's recommendation is already running into resistance on the PUC. Commissioner Richard Bilas said the five-member panel should not be micromanaging the utilities in a time of crisis. Bilas has proposed an alternate ruling that would allow the utilities to make the cuts but provide for PUC monitoring of service in case the commission wants to step in later. We're in a situation where the utilities are not collecting the revenues they need to operate and yet we may be guilty of not letting them cut expenses where they can cut expenses Bilas said. PG&E spokesman Jon Tremayne said savings from the layoffs are helping to keep electricity running and gas flowing. It keeps cash in our accounts so we can keep doing day-to-day business Tremayne said. In addition to the 325 positions dropped so far PG&E is proposing to cut an additional 675 during the next three to six months. The cuts affect temporary and contract workers who read meters handle new service hookups and replace equipment. PG&E has no plans to eliminate permanent positions. The company is struggling to keep up with a higher workload at its call center as customers deluge the lines with inquiries about their rising bills and the effects of deregulation. Calls to PG&E ballooned from 1.3 million in January 2000 to 2.3 million in January 2001. Bilas advocates granting PG&E's request to temporarily relax standards requiring the utility to respond swiftly to customer calls and to read customers' meters once a month. PG&E wants to read meters bimonthly and send bills based on the estimated use between readings. Discrepancies could be corrected later. Wong called those measures unacceptable. He said customers need to know immediately if their efforts to conserve power are working. Wong also said the utilities' own experts have said the workforce reductions will lengthen the time required to restore power after nonemergency equipment failure. Eric Wolfe communications director for the International Brotherhood of Electrical Workers Local 1245 said some customers have already been left without power overnight because PG&E is trying to avoid the use of overtime on nonemergency power outages. It hurts a lineman to walk away from the job leaving a customer without power Wolfe said. Tremayne said PG&E is trying to minimize overtime costs but denied the company has allowed customers to go without power out of financial concerns. He said crews were pulled out when darkness and falling trees made the work too dangerous. ---- Power prices could soar during the summer Posted at 10:35 p.m. PST Tuesday March 6 2001 BY STEVE JOHNSON Mercury News Unless Gov. Gray Davis arranges significantly more long-term electricity contracts or persuades people to turn off a lot more lights California's unpredictable spot market for power could wreak havoc this summer. Even with the 40 long-term deals announced by Davis on Monday experts interviewed Tuesday said up to 43 percent of the state's daily needs may have to come from this highly volatile market in which power is bought within a day of need. That could could prove hugely expensive because some spot market energy has cost five to six times what it would under the long-term contracts. It's widely expected that consumers ultimately would have to pay that tab which could amount to billions of dollars. And because that power won't be locked up in contracts there is no guarantee it will be available when it's needed which could lead to blackouts according to a recent report to the California Independent System Operator which oversees three-fourths of the state's power grid. ``The situation in California could reach catastrophic proportions'' the report concluded adding that unless things change dramatically ``it is a virtual certainty that peak demand will go unmet during many hot summer days.'' Steven Maviglio Davis' press secretary conceded Tuesday that the spot market could be troublesome. ``It's a major concern'' he said which is why the state is trying to line up more power contracts speed up power plant construction and promote conservation. During the normally hot month of August peak daily demand for power in the Independent System Operator's territory is expected to hit about 47700 megawatts -- enough for nearly 48 million homes. The state's three main utility firms generate about 8200 megawatts and have long-term contracts from wind solar and other energy sources for about 11700 megawatts more. That totals about 20000 megawatts. Add in the 7000 megawatts of long-term power that Davis has announced for this summer and the state is still nearly 21000 megawatts short. Costly proposition If all that power has to be obtained on the spot market the price could be high. On Friday last-minute purchases on the market averaged $411 per megawatt-hour compared to about $150 per megawatt-hour for all power obtained by the Independent System Operator and $69 per megawatt-hour on average under Davis' long-term contracts. It's possible that not all 21000 megawatts would have to be purchased on the market. Assuming Davis is successful in getting people to save 10 percent -- which could prove difficult -- conservation could reduce peak demand by nearly 5000 megawatts. California also might be able to trade for another 5000 megawatts with the federal government's Bonneville Power Administration and a hydroelectric operator in British Columbia said Arthur O'Donnell editor of California Energy Markets a trade publication. Under such deals those two outfits often send that much power to California when they don't need it and California returns the same amount or more when its demand is low. But O'Donnell said it wasn't clear whether 5000 megawatts would be available this summer because ``they still haven't gotten the snowpack they need in the Pacific Northwest'' which could limit that region's generating capacity. Still falling short Even if those hydropower imports are available and conservation works as Davis hopes it's likely California would still require the spot market for 11000 megawatts to meet the August demand. That's more than 20 percent of the state's overall power needs. ``All of the surrounding states are buying probably less than 5 percent at most of their energy on the spot market'' said Frank Wolak a Stanford economist who monitors electricity prices for the Independent System Operator. He worries about how much that power could cost and is disturbed that state officials haven't adequately addressed the issue. ``No one has any idea what they are going to do and that is part of the problem'' he said. Officials at Pacific Gas & Electric Co. are particularly concerned. They fear that their company -- which is nearing bankruptcy -- could get stuck for much of the spot market purchases by the Independent System Operator which has threatened to bill the utilities for the cost. Fearing the annual bill for that power could hit $2.4 billion this year PG&E wants the tab sent to the Department of Water Resources which also is buying power on the spot market for the state. But the Department of Water Resources has objected to that idea and the matter is expected to be heard today by the California Public Utilities Commission. ``We're looking for clarity on a number of issues'' regarding how the spot market will work ``and certainly that's one of them'' said Thomas Hannigan the water agency's director. ``I don't think anybody knows the answer of who's going to pay for it'' added PG&E spokesman John Nelson. But Nettie Hoge executive director of the Utility Reform Network in San Francisco said she suspects consumers ultimately will foot the bill. The unfortunate likelihood about spot market purchases is that ``ratepayers are responsible for all of it eventually'' Hoge said. ``It's a very big problem.'' ---- Power Plant Plans Cause Conflicts East county residents blast supervisors Jason B. Johnson Chronicle Staff Writer Wednesday March 7 2001 Industry dreams of building new power plants in east Contra Costa's hills are prompting an angry reaction among residents and elected officials who say they don't want more plants. The conflict was sparked by a vote by county supervisors yesterday to aggressively explore possible sites for new power plants throughout the county. The measure by Supervisors Mark DeSaulnier and Federal Glover which passed on a 4-to-0 vote directs the county administrator and Department of Community Development to compile a report on possible sites within 45 days. Supervisor Donna Gerber abstained after criticizing the plan for potentially repeating the same mistakes that plagued the state's energy deregulation effort by not considering how much energy the state region and county will need in future years and how much power is slated to come online. Gerber said alternative power sources such as solar should also be examined. A site drawing much attention is on top of a deposit of natural gas near the Concord Naval Weapons Station off Highway 4. The owners of 70 acres of land near the station recently formed a company Golden State Power Co. to pursue construction of at least one small peaker plant and a much larger facility capable of producing 600 megawatts. The site could hold up to three small 50-megawatt peaker plants and a larger 15-acre natural gas plant said Steve Thomas managing partner with Golden State. No land use applications have been filed. Thomas said 30 acres could be kept as open space to form a buffer around the project. Both (facilities) are state of the art said Thomas. We believe that the site is ideal. But east county residents at yesterday's meeting blasted the supervisorial measure and the power plant proposal complaining that more plants could put people's health at risk. The region already is home to six power plants. We're going to get a good dose of poor air quality and (negative) health conditions from this said Concord resident Evelyn Frietas. I think we need to stop and think about what we're doing to our quality of life. Dan Torres said the home he bought in 1995 at a new Bay Point development would be alarmingly close to the proposed Golden State site. It will be dragging emissions over our home said Torres. I didn't buy a home on that hill to be surrounded by power plants. There are six power plants in operation in east Contra Costa. Pittsburg already has two power plants and two more under construction. City Council members Frank Aiello and Yvonne Beals said the Antioch-Pittsburg area has done more than its share of energy production. Aiello said Pittsburg will soon produce enough energy to power three million homes in California. When is enough enough? asked Aiello. Pittsburg has shouldered responsibility for a land-fill and two more power plants. At some point you have to say enough. Beals said that while power plants have added millions to the city's general fund the negatives of additional plants could outweigh the benefits. I don't think that Pittsburg or east county should be the dumping ground for energy for California said Beals. ---- Supervisors set search for power plant sites The board also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord By Thomas Peele TIMES STAFF WRITER MARTINEZ -- Contra Costa County supervisors took tentative steps Tuesday toward allowing the construction of at least one small power plant before summer ordering that its staff identify potential sites in unincorporated areas within seven weeks. The board voted 4-0 to search for locations. Third District Supervisor Donna Gerber abstained saying her colleagues lacked a comprehensive context'' to identify sites. I think the board knows just enough to be dangerous'' she said. Gerber said the county should examine the potential for additional power plants within its borders but not investigate individual sites yet. But Fourth District Supervisor Mark DeSaulnier said the action was necessary because of the energy crisis and because of Gov. Gray Davis' call for local governments to help speed the construction of so-called peaker plants before July and August. I wouldn't do this except under an emergency DeSaulnier said after the vote. There are unusual circumstances. We're not talking about putting this in a residential area. Fifth District Supervisor Federal Glover backed DeSaulnier but said he hoped for a location outside his heavily industrialized East County district. There's a lot of concern in East County as to the number of plants he said. DeSaulnier said though that the only logical place for a small plant remains the industrial belt'' stretching along the waterfront from West County to Antioch. He declined to provide specifics but said the only other potential site outside the industrial areas was the Concord Naval Weapons Station property. But he quickly added that he believes the U.S. Department of Defense would never go for it. Also DeSaulnier said he could not rule out the county building the plant itself and entering the electricity-selling market during peak demand times. Board Chairwoman Gayle Uilkema called that idea extremely premature and unlikely. That's a very powerful decision. I do not think we are ready'' she said. The California Energy Commission listed the Equilon refinery in Martinez as one of 32 potential peaker plant sites in the state last week. Peaker plants kick in during peak usage times. Davis called for their quick construction before the height of summer and its energy demand for air conditioning. Plants that generate as much as 50000 megawatts don't need Energy Commission approval. DeSaulnier said he believed a peaker plant could be built about a month after final approval. Supervisors also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord. Walnut Creek commercial real estate developer Steve Thomas announced his intentions for the site north of Highway 4 last week. Construction could take two years. Eric Hasseltine a consultant representing Thomas and what he described as a brand new company for the site the Golden State Power Co. told supervisors that if they intended to speed peaker plant construction they should do what they can to expedite the larger plant. The Thomas site could house a peaker plant until the proposed larger one goes online. A large natural gas line passes under the site. DeSaulnier seemed cautious about the larger proposal which he had described last week as a good site. Uilkema too said she knew too little about it to comment. A resident who lives near the Thomas property asked the board to build it (the larger plant) closer to where you have industrial areas. You have to carefully consider the people who live nearby said Dan Torres 39. Evelyn Freitas of Concord said she lives downwind of the proposed site. Our air quality is going to be worse then it is now she said. Gerber played on the environmental issues saying the county already ranks second statewide to Los Angeles in volume of hazardous materials and amount of electrical generation. ---- Peter Schrag: California's $90 billion infrastructure gap (Published March 7 2001) By now California's surreal energy mess has grown from a crisis to a condition. It may not be quite as permanent as say death and taxes but it's still something that could get a whole lot worse before it gets better. Until there's more realistic pricing no gubernatorial pea-under-the-shell buyout scheme will solve it. Beyond the energy crisis however and in many ways similar to it California faces a whole range of other infrastructure problems -- in transportation in water resources and sewer systems in school and university buildings -- that seem once again to be all but forgotten. The Business Roundtable has estimated the need at roughly $90 billion though no number can possibly be exact. What's certain is that after a burst of high-level investment in public facilities during the 1950s and 1960s California's annual capital investment has sunk precipitously -- from an annual $150 per capita in the 1960s according to a set of recent studies for PPIC the Public Policy Institute of California to about $30 in the 1990s. But you probably don't need to tell anyone driving Bay Area or Los Angeles freeways or looking at the ubiquitous portable classrooms those dreary brown boxes that house a fourth of our public school students. Ever since passage of Proposition 13 in 1978 we have been flying the flag of deferred maintenance. As in the state's electricity crisis however there's no way California can effectively address those problems merely by building or bonding itself out of them. In highway construction in developing water resources in finding enough university space to accommodate the Tidal Wave II of students managing demand is likely to be as crucial to any solution as new construction. In the energy market -- and in electricity particularly -- it's been a familiar principle ever since David Roe of the Environmental Defense Fund first persuaded Pacific Gas and Electric that a dollar invested in conservation may be worth as much as the same investment in new generation. But in most other sectors of California's infrastructure state and local it's a lesson still to be learned. There have been scattered attempts to encourage conservation and reduce demand -- significant reduction in water use for example through the installation of low-flow faucets and low-flush toilets some reduction in traffic by using rush-hour diamond lanes or by adjusting highway or (as in New York) bridge tolls to levels of congestion. But as pointed out by David Dowall an urban economist at Berkeley state policy-makers have not really begun to consider how demand management strategies can be applied to infrastructure service areas or how the more efficient use of facilities and more realistic pricing -- highway tolls say or parking fees -- can reduce demand for scarce infrastructure resources. In any case says Dowall in one of the PPIC reports we should pick which major projects we will build not just according to per capita estimates of how much we need but according to how much consumers are willing to pay for them. To avoid hurting the poor congestion-related highway tolls and other tariffs can be rebated on the basis of income. University fees can be means-tested. In California they also could be adjusted to encourage summer school classes and other off-peak uses rather than (as in the past) making UC summer courses more expensive. Given the political and economic uncertainties there's no way to know how far such demand management can be taken. But there's not much doubt that as Dowall and others point out the state's infrastructure planning is a jumble of uncoordinated agency agendas and wish lists. The Legislature last year passed a bill AB 1473 by Assembly Speaker Robert Hertzberg that requires the governor beginning next year to submit an annual five-year infrastructure plan for state agencies and public schools along with recommendations on how to fund it. In addition Gov. Gray Davis' infrastructure commission is expected to recommend better coordination of infrastructure and land-use planning when it issues its report this spring. That would be a start. As California State Treasurer Phil Angelides has pointed out the state desperately needs to start joint planning -- regional planning -- for housing roads and other resources to reduce the need for long commutes to preserve open space and to bring jobs to where people live and housing to where the jobs are. That would itself reduce demand for more freeway lanes and equally important improve the quality of life. At present most planning for housing roads water systems and other facilities rarely recognizes the regional impact of local decisions. In the East Bay slow-growth forces push well-intended initiatives that would force more development into Tracy or Modesto and further tax the transportation systems to Silicon Valley. In city after city there are beggar-thy-neighbor efforts to grab yet another shopping mall that produces a little extra sales tax revenue for the city that gets it and that often compounds traffic and revenue problems in adjacent communities. In higher education we divide bond proceeds evenly among UC the California State University and the community colleges even though the community colleges serve eight times as many students as UC. We plan road projects according to county not regional priorities. It is all done according to antiquated political and fiscal formulas that often no longer make sense. We don't just need better capital planning we need a whole new planning system. ---- PG&E power plan debated at hearing A PUC meeting on the utility's capacity expansion project for the Tri-Valley follows weeks of protest from officials residents Power upgrade in valley debated By Megan Long TIMES STAFF WRITER SAN FRANCISCO -- Dublin officials and the developer of a Livermore subdivision faced questions Tuesday about their opposition to alternative routes of PG&E's controversial Tri-Valley power upgrade plan -- and answered by restating their long-standing objections. Tuesday's cross-examination came during the third and likely final week of the California Public Utility Commission's evidentiary hearings on the utility's $91 million Tri-Valley 2002 Capacity Increase Project. It has followed weeks of protests of PG&E's upgrade plans by officials and residents of Livermore Pleasanton Dublin and San Ramon. And before the questioning started Dublin Vice Mayor Janet Lockhart reiterated concerns about an alternative route deemed environmentally superior that would place a substation just 1000 feet north of Interstate 580 between Tassajara and Fallon roads. She said that would undermine the results of a 15-year process to plan the eastern development of the city. It's extremely important to the residents of our community to follow a plan we worked hard to produce she said. Dublin officials favor PG&E's proposed placement of the station three miles north of the freeway away from new high-tech company offices and housing developments. Besides the Dublin substation the project calls for construction of a substation in North Livermore expansion of the Pleasanton substation and installation of 23.5 miles of new lines. In response to questions from PUC Administrative Law Judge Michelle Cooke Dublin's public works director Lee Thompson confirmed that the Lin family the owner of the property where the alternative substation would go wasn't interested in selling the land to PG&E. Cooke also asked Thompson to define a discretionary permit which is how city officials said they might treat a permit for a substation. Lee said that type of permit is one the city has the right to approve or not depending on the project's impact. Eddie Peabody Dublin's community development director testified that the zoning for the Lin property accommodates uses such as commercial business research and development and light manufacturing. It would not he said be appropriate for a power substation. He said parcels within the East Dublin area that could host a station would include those zoned for public and semi-public uses including land recently bought by Oracle and Sun Microsystems for new campuses. While Dublin officials testified that one buyer of land in that area paid $86 per square foot others suggested land prices would be inflated to help make a PG&E land buy look prohibitively expensive. An executive of Centex Homes the developer of new houses near Isabel Avenue and Concannon Boulevard objected to an alternative route that would place high-voltage transmission lines overhead along Isabel and Stanley Boulevard. David Barclay president of Centex's Northern California division said that the 80-foot to 150-foot towers would have a severe visual impact on residents of the Prima tract. Ed O'Neill a lawyer for the Kottinger Ranch Homeowners Association pointed out that existing distribution lines on 50-foot poles on Isabel already mar the view for residents. The Foley family has been ranching on land south of Pleasanton city limits for years said their attorney Kennedy Richardson. The utility's project would place overhead lines and a transmission station on rolling hills that the family envisions as one day being public open space with limited development Richardson said. Lawyers for Pleasanton Livermore Kottinger Ranch and Centex are scheduled to cross-examine a PG&E engineer today about the project's routing. That testimony should be the most controversial of the hearings. Judge Cooke is expected to recommend an alignment by July to the PUC which will make the final decision. ---- NEWS State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August Marshall Wilson 03/08/2001 The San Francisco Chronicle FINAL Page A.20 (Copyright 2001) State energy officials yesterday approved plans to build a temporary electrical plant at San Francisco International Airport that should generate enough juice to power 50000 homes by August. Meeting in Sacramento the Energy Commission voted 4-0 to give the green light to the gas-fired plant. It will operate during peak summer and winter demand to help the state avoid Stage 3 power alerts and rolling blackouts. Texas-based El Paso Merchant Energy Co. won approval under a new state law mandating speedy four-month reviews of so-called peaker plants. It was the only one of seven applications statewide to win approval. The other proposals were withdrawn for various reasons. The 51-megawatt plant formally called the United Golden Gate Power Project is scheduled to be built at the northwest corner of the airport near the United Airlines maintenance center. Within the next few weeks El Paso plans to apply to build a 571- megawatt $400 million plant in the same area company spokesman Jesse Frederick said. It would undergo a separate review by state energy officials. The small peaker plant approved yesterday is to generate electricity beginning around Aug. 1 for up to three years. After the end of three years the plant would be closed or converted to a cleaner-burning system. Under state law a temporary peaker plant is permitted to spew more air pollution than a permanent plant. El Paso's temporary plant is to be built next to a co-generation plant operated by United Airlines. It would use existing connections for natural gas and water supplies and tap into existing power transmission lines. Electricity generated by the plant would be pumped into the state's electrical grid Energy Commission spokesman Gary Fay said. It would also serve as a backup for San Francisco Airport in case of a blackout. No one spoke against the proposed plant at yesterday's commission meeting. The proposal however has been criticized by area residents and environmentalists worried about air pollution. Scott Buschman a professional photographer and San Bruno resident said yesterday it was unjust that state officials 100 miles away in Sacramento approved a Texas company's proposal to put a power plant on land owned by San Francisco. The fact that they approved it without considering the public's concerns foremost air quality is very disturbing he said. Fay said the plant complies with clean-air standards. Answering the criticism about the location of yesterday's deliberation he said three hearings and several workshops were held in communities near the airport. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. ---- Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals By Wall Street Journal staff reporters Rebecca Smith Mitchel Benson and John R. Emshwiller 03/08/2001 The Wall Street Journal A1 (Copyright (c) 2001 Dow Jones & Company Inc.) SACRAMENTO Calif. -- Earlier this year Gov. Gray Davis made what may be the biggest bet in the history of the nation's biggest state: that he could tame an out-of-control electricity market and avoid devastating blackouts without busting the state's budget antagonizing its consumers or derailing his own political career. His wager is still on the table but the assumptions that underlie it are looking increasingly shaky these days. The governor has already spent around $2 billion of public money buying hugely expensive wholesale power taking over the role formerly played by the state's near-bankrupt electric utilities. And California will probably be obliged to spend billions more before its electricity market stabilizes and those utilities are restored to some semblance of financial health. Under the governor's plan California aims to recoup the money it is using to buy electricity by issuing $10 billion in bonds. That way it would still have a healthy budget surplus to finance new spending on roads schools and other public services. But there's a potentially big obstacle to this plan. The state Legislature worried about racking up billions in new debt has put limits on the size of any bond offering. In broad terms the Legislature's action would allow the state to borrow only four times as much as it can recover annually from utility customers. Right now that doesn't appear to be much. Under the current rate structure essentially set in place by California's flawed 1996 electricity-deregulation plan consumers pay far less for power than the cost of acquiring it on the wholesale market. Preliminary estimates submitted by utilities last month to the California Public Utilities Commission show the state's share of the proceeds from electricity sales this year could be as little as $241 million -- not enough to support even $1 billion in bond sales under the Legislature's formula. That would leave the state on the hook for much of the money it has already paid for power -- not to mention the billions more Gov. Davis will need to spend. That in turn raises the prospect that California's economy and its credit rating both could deteriorate significantly. But state finance officials say that based on their own projections they will be able to extract enough money to support a $10 billion bond issue. Walking a careful line between fiscal prudence and political survival Mr. Davis and others in his administration are scrambling to come up with ways to get around the legislative restrictions without raising rates for consumers. If I wanted to raise rates I could solve this problem in 20 minutes Mr. Davis says. The governor says he believes that the state can obtain enough affordable power through long-term power-supply contracts to avoid the need for a big rate increase. The billions of dollars the state hopes to borrow would be used to help pay for power until electricity prices drop as they are expected to do when new power plants come online over the next few years. The Davis administration fears that what may be its only other option -- a big increase in retail electric rates -- could prompt angry consumer groups to seek new electricity laws through a statewide ballot initiative during next year's election. That's when Mr. Davis is expected to run for a second term as governor. But trying to save California without rate increases is forcing Mr. Davis to make some colossal gambles with the state's money. State officials estimate that in the next several months California will need to spend as much as $6 billion on power purchases -- equivalent to the state's entire fiscal surplus. Mr. Davis is also looking to spend several billion more to buy the transmission assets of three investor-owned utilities in order to restore two of them to credit-worthiness. He also has announced plans to spend several hundred million dollars more on conservation programs designed to reduce demand while new power plants are being built in the state. In order to limit the state's financial exposure in the meantime the governor and his aides have in some cases ignored state law. They have threatened appointed officials who have stood in the way. And they have sharply restricted the flow of information to the public. None of those steps is expected to do much to reduce state spending on power in the coming months. In a few weeks power usage is expected to begin a sharp seasonal rise as Californians switch on their air conditioners with the coming of warmer weather. By various estimates demand during peak periods this summer could outstrip supply by 10% or several thousand megawatts. That could produce more rolling blackouts like the ones that hit Northern California earlier this year. It is also likely to put strong upward pressure on wholesale electricity prices. Steven Zimmerman managing director of Standard & Poor's Corp. says Mr. Davis and his aides don't have a lot of time to put a cap on the state's financial exposure to the crisis. The credit-rating agency has put the state on credit watch for a possible downgrade which would affect the value of all of California's outstanding public debt. Moody's Investor Service Inc. is also concerned. It said in a recent report that the power crisis could soon seriously threaten the health of the state's economy. Mr. Davis a Democrat and career politician was dealt a bad hand when he took office in 1999. The deregulation plan that sparked the state's electricity crisis was enacted under his predecessor Republican Pete Wilson. But Mr. Davis was slow to react to early signs of trouble this past summer and alarms sounded by members of the state Legislature. By the time Mr. Davis finally sprang into action earlier this year a troublesome power-supply squeeze had escalated into a crisis. In a Jan. 17 declaration of emergency the governor designated the state Department of Water Resources to take the utilities' place as the daily buyer of huge quantities of electricity. His hope: that by making the state the dominant player in California's power sector he would ease electricity producers' concerns about getting paid and give the state enough clout to negotiate lower long-term power prices. Earlier this week Mr. Davis announced final or tentative agreements with 20 power suppliers to furnish the state with a total of 8900 megawatts for periods of as long as 20 years. But the supply situation remains extremely uncertain for this summer when demand probably will top 45000 megawatts. If the state can secure enough power under contract and push down demand through aggressive conservation it might be able to squeak through the summer season. If not it will be forced to keep buying huge amounts of costly power in the cash market. Under deregulation retail electric rates were frozen for several years while wholesale-power costs were free to fluctuate. When the plan was conceived wholesale prices were low and expected to go lower. However a combination of unexpected growth in power demand and a lack of new generating capacity helped produce a supply squeeze. Average wholesale prices more than tripled last year from 1999. And in January those prices were up 10-fold from a year earlier. By then California's two biggest investor-owned utilities -- the Pacific Gas & Electric unit of PG&E Corp. and the Southern California Edison subsidiary of Edison International -- faced imminent financial collapse. They had racked up billions of dollars in wholesale power bills they couldn't afford to pay. As generators began shying away from selling to the two utilities the Clinton administration forced them to sell power into the California market an order left in place during the first weeks of the Bush administration. Still northern California was hit by rolling blackouts on several days in early January. Since then the DWR which does some electricity trading as an adjunct to its main mission of managing the state's giant system of aqueducts and reservoirs has had to learn the ins and outs of power markets on the run. It hasn't been easy. David Mills trading-floor manager for the federal Bonneville Power Administration says the water agency has at times offered to pay $50 to $100 per megawatt hour more than the available market price. They agree to prices that make you wonder says Mr. Mills whose organization markets electricity from federal dams in the Pacific Northwest. You'd at least think they'd check to see what the prevailing price is before throwing out their offer. Mr. Mills says that to cut California some slack he occasionally has instructed his traders to sell at prices lower than the DWR had offered to pay. Ray Hart the water agency deputy director responsible for the power purchasing says he isn't aware of any cases in which the DWR has overpaid. He says his team has been extremely successful by all measures. Ultimately the DWR's trading acumen is far less important than the overall arithmetic of power supply and demand in California. With the price of natural gas that feeds many of the region's generating plants at near record levels and some suppliers reluctant to sell into the troubled California market wholesale electric prices remain stubbornly high and in recent days have again been rising. The Legislature has advanced the DWR about $3 billion from the state's general fund for power purchases. Under emergency legislation passed by the Legislature and signed by Mr. Davis on Feb. 1 the general fund is to be reimbursed from a planned bond sale later this year. But under terms of the emergency law the water agency would have to wrest $2.5 billion a year in revenue from retail electricity rates in order to sell the $10 billion worth of bonds sought by Mr. Davis. Assembly Speaker Robert Hertzberg a Southern California Democrat says the formula was created to ensure that there would be a way to repay the bonds without draining the state's coffers. We didn't want to just open our wallets he says. According to the language of the Feb. 1 law the water agency gets what's left of revenue collected from ratepayers after the utilities pay certain of their own power-supply bills and other expenses. And in their filings with the PUC last month the utilities reckoned under their worst-case scenarios that there would be only $241 million available to the DWR this year. State officials are quietly pushing the PUC to rejigger the formula so that the water department gets more money -- even though that would clash with terms of the Feb. 1 law. Robert Miyashiro deputy director of the Department of Finance says the emergency law was drafted poorly and has led people to believe the DWR only gets the leftover money. He predicts there will be cleanup legislation. At the request of the Davis administration the PUC is considering a plan to use a different revenue-sharing formula than the one in the state law. The proposed new formula was written in close consultation with Mr. Davis's Finance Department says PUC President Loretta Lynch who supports the initiative and is hoping to rush it through. The effort has drawn some opposition. Commissioner Richard Bilas at a recent PUC meeting questioned the legality of the commission attempting to change a formula set by the Legislature. PG&E is even more emphatic since the DWR's extra money could come at the utility's expense. The formula threatens to undo the very financial protections for the utilities that [the new law] attempted to provide the utility said in a recent filing with the PUC. As politicians and regulators wrestle with that issue the Davis administration has taken a step to reduce the outflow of state cash that also seems to conflict with the Feb. 1 law. It was widely assumed that the law required the DWR to buy any electricity the state needed to keep its lights on. However on many occasions the DWR has refused to buy power on the grounds that it was too expensive citing a portion of the new law that urges the agency to hold down costs. The task of covering any remaining shortfall has passed to the California Independent System Operator which manages the state's energy grid and is charged with buying power when necessary to avert shortages. However the ISO doesn't have any power-purchasing money of its own and the major parties it would normally bill are PG&E and Edison whose inability to pay their power bills was the reason the state started buying electricity in the first place. Amid criticism of its stance from generators utilities and Wall Street the DWR says it has started covering more of the utilities' electricity costs. The water agency is now buying 95% to 99% of what California needs in a given day says the agency's Mr. Hart. But increased buying only adds to the uncertainty about the eventual tab. The state's legislative analyst Elizabeth Hill recently recommended that lawmakers hold off considering more than $2 billion in state spending on items ranging from college construction to beach cleanups because of continuing questions about the financial impact of the electricity crisis. Like others Ms. Hill complains that the governor's office and state agencies haven't been forthcoming with information. Indeed the DWR refuses to say precisely how much power it is purchasing and at what prices though it has on several occasions gone back to the Legislature for more money. State officials say that data on its purchasing activities would give suppliers an advantage in continuing electricity-supply contract talks. State Controller Kathleen Connell who is running for mayor of Los Angeles in an April election recently announced plans to post state power-spending information on her department's Web site. But within 24 hours Ms. Connell suspended that plan after discussions with senior Davis administration officials. I feel very strongly that this information should be publicly released says Ms. Connell. I just don't want to do anything that would weaken the state's effectiveness in negotiating. In an effort to more tightly control events the governor obtained legislative approval to abolish the 26-member ISO board which was made up of everyone from utility executives to representatives of consumer groups. He then appointed a new five-member board. To ensure a quick transition the California attorney general threatened the old board members with fines of as much as $5000 each if they didn't immediately relinquish their positions. All did. I was offended at the heavy-handed treatment says Karen Johanson a former ISO board member. One of the first acts of the ISO's new board was to close a meeting about the electricity crisis. The former ISO board routinely held such meetings in public. ISO attorneys say the meeting was largely designed as a private briefing for new board members and that the organization is committed to keeping its deliberations as open as possible. The Wall Street Journal and other news organizations have unsuccessfully challenged the closure in Sacramento state court. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: L.A. Confidential has been received. Body:: [IMAGE] Qwiklist(9) MyAccount Rental History Shipping List We have received L.A. Confidential(1997) on 12/31/2001 We will be processing your QwikList selections and will send the next available dvd on your QwikList. You will receive another email when it ships. Thank You! [IMAGE] L.A. Confidential(1997) Home | Customer Service | Rental Details What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Compensation Resource Group, Inc.s Publications Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: IS TRADING AN INSIDERS GAME? Body:: The attached article appeared in today's San Diego Union. I now have the official transcript from the Senate hearing of May 18 if you need that. If you are scheduling a conf call for tomorrow can you do it after 12 your time as I am flying to San Francisco and will then be in the Brobeck offices. Thanks The information contained in this e-mail message and any accompanying documents is subject to the attorney-client privilege and/or the attorney work product rule and is confidential business information intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient or representative of the recipient you are hereby notified that any dissemination of this communication is strictly prohibited. If you have received this communication in error please notify the Systems Administrator at admin@pkns.com and immediately delete this message from your system. Content-Transfer-Encoding: quoted-printable Date: Wed 06 Jun 2001 08:53:28 -0700 From: Cindy Frederick To: Michael Kirby Subject: IS TRADING AN INSIDER'S GAME? Mime-Version: 1.0 Content-Type: text/plain charset=us-ascii Content-Disposition: inline IS TRADING AN INSIDER'S GAME? Buying selling of electricity is a growth business but some say deck is stacked against consumers By Craig D. Rose STAFF WRITER June 6 2001 While Californians decry deregulation's failure to deliver a competitive market electricity wholesalers have quietly developed a vast and rapidly growing business of buying and selling power among themselves. The deals take place on high-tech trading floors in Houston and elsewhere around the country as well as on Internet-based trading systems. Some experts say this electricity trading is a key mechanism for raising consumer power prices yet it's largely unregulated. Electricity trading is like buying stock -- when you have ability to change the stock price said Frank Wolak a Stanford University economics professor and member of the state grid operator's market surveillance group. Energy companies say the buying and selling of contracts to deliver power provides risk management allowing plant owners to presell their electricity lock in prices and avoid fluctuations. The rough and tumble of the free market they add is the most efficient means of allocating a resource like electricity. But industry critics say trading is far from a competitive market paradigm. In their view it's a means of communication -- a way for energy insiders to collude and raise prices under the guise of competition. To be sure the trading arms of major energy companies have emerged as stars in an industry where profit surges of 300 percent or 400 percent are not uncommon. The transactions shrouded in secrecy can leave ownership of a critical commodity in unknown hands. Consider the case of power generated by AES Corp.'s California plants. In 1998 AES made a bold move. Immediately after purchasing power plants that gave it control of 10 percent of the state's electric generating capacity the company sold the output from its plants for the next 20 years to Williams Cos. Williams did not sit on this treasure trove of electrons. The Tulsa Okla. company soon sold 80 percent of what it bought. It is difficult to say who owns that power now. Some might be owned by Sempra Trading a sister company of SDG&E. Or some could be owned by Enron Corp. the nation's biggest electricity trader. A spokeswoman for Williams conceded that Williams itself may have repurchased some of the electricity it sold earlier. But trading companies closely guard their positions. This much can be said with certainty: Electricity that AES sold for less than 5 cents per kilowatt-hour to Williams changed hands perhaps 10 times in the wholesale market and emerged at times in recent months with a price tag for consumers that was 300 percent higher. Williams' trading profits increased by 523 percent in the first quarter this year. Advance sales All this buying and selling creates curious confluences. In their attempt to deflect criticism over high prices generating companies such as Duke Energy -- operator of the South Bay Power Plant in Chula and others in the state -- frequently note that they sell most of their electricity far in advance. But they acknowledge less often that their trading units may also be buying power which could boost the company's electricity inventory. Duke was the fourth biggest electricity trader last year and cited its trading activity as a prime contributor to its wholesale business profits which soared 324 percent in the first quarter to $348 million. It is a company's power traders who frequently direct plant operators to increase or decrease the generation of power in response to market conditions. Energy companies have little option but to turn to trading for profits. One of the better kept secrets of electrical deregulation and its promise of competition is that there is remarkably little competition in the production side of the business. For one thing electricity is a commodity power from one company is indistinguishable from that generated by others. More important nearly all modern plants generate power from turbines built by a handful of manufacturers. The result? Modern plants owned by different companies produce power at nearly identical cost. The cost of power produced by modern plants is all within a mil (one-thousandth of a dollar) said Michael Peevey an adviser to Gov. Gray Davis and former president of Southern California Edison. So the extraction of profit in the electricity business relies much more on trading. Traders' profits rise when prices are volatile -- plunging or even better rising sharply. Little regulation But despite the obvious temptation to manipulate the market the burgeoning electricity trading business has remained largely unregulated. The Federal Energy Regulatory Commission does require quarterly filings from energy traders but these often provide incomplete information or at least little that has been of concern to FERC. In fact although the trading of electricity grew more than a hundredfold from 1996 to 2000 FERC has taken no major enforcement action against a trader. After the onset of the California crisis last year FERC has acted once. That was against Williams which agreed to pay $8 million without admitting guilt to resolve an allegation that it withheld supply to pump up prices. FERC's record of enforcement in the area of power trading stands in contrast to a long list of enforcement actions within other markets taken by the Securities Exchange Commission and the Commodity Futures Trading Commission. FERC has recently added staff to its market oversight operations. But William Massey a FERC commissioner says the agency's effort is still inadequate. Electricity can be flipped stripped and chopped up Massey said. It's an extraordinarily complicated market. The sophisticated marketers and traders have simply moved past us. We're kind of horse and buggy in our approach and they're out there in rocket ships flying around ... The problem is that sophisticated traders don't necessarily produce reasonable prices. They produce profits. Before deregulation electricity trading was a low-key affair. Regulated utilities dealt power back and forth on a reciprocal basis to fill electricity shortfalls in their control areas. There was little trading for profit until the mid-1990s after federal legislation and FERC rulings opened the market. Major traders include large energy companies sister companies of California's major utilities and Wall Street firms. Market volatility In many ways the trading of power is similar to that of other commodities. But there are important differences. Because it cannot be stored and its use is so fundamental the price of electricity is the most volatile of all. When supplies are tight a single supplier can rapidly raise prices to budget-busting levels as evidenced by Duke Energy's recent admission that it charged California nearly $4000 for a megawatt-hour of power a quantity that probably sold hours earlier for one-tenth of that sum or less. Wolak the Stanford economist and state Sen. Joseph Dunn D-Garden Grove who is investigating the state power market say trading allows companies to collude under the guise of competition. Instead of wringing out lowest costs the wholesale trading market serves to raise prices they say. As I trade to you and you trade to me we communicate to each other what price we would like to get said Wolak. It's not collusive. It's just communicating price. Mark Palmer a spokesman for Enron the nation's biggest power trader said California's problem is not the result of trading. It's a result of shortages Palmer said. Underscoring its emphasis on trading Enron's new headquarters tower in downtown Houston rises from a six-story block of new trading floors including expanded space for electricity trading. Enron also pioneered trading in cyberspace and its Enron Online site claims to be the most active computer-based trading market. The Houston company argues that consumers won't fully benefit from power trading and deregulation until they have greater choice in choosing their power supplier. And the company says FERC has not done enough to open access to transmission lines which would allow traders to move power around the country. To that end Enron has lobbied hard for President Bush's plan for a national electricity grid. Palmer says the notion that the price of electricity rises each time it is traded is mistaken. The market is always looking for the real price of a commodity Palmer said. Dunn the California state senator says his investigation found a different function for trading. At a time when supply barely meets or falls short of demand he noted companies with electricity to sell have to worry only about how high to set their price. The trader is a pawn in the generator's game to drive up prices said Dunn. Trading develops a level of trust. You my alleged competitor will bid in the same patterns and I will respond not in a competitive pattern but in a complimentary pattern. The state senator said his investigation found evidence that on several days energy companies appeared to test their ability to drive prices up without being undercut by competitors. This ability to drive up prices without competitive consequence is a key test of market power the technical term for manipulation or price fixing. But Dunn also conceded that antitrust violations can be hard to prove in court. He suggested that even if the trading behavior falls short of antitrust violations it remains anti-competitive and devastating for the California economy. To Harry Trebing a utility industry expert and professor emeritus at Michigan State University wholesale electricity trading is reminiscent of what took place in the 1920s and early '30s. Back then utility companies created complex networks of holding companies that traded stock among themselves driving up prices in the process. Undoing that scheme was a focus of President Franklin Roosevelt's administration. Congress ended up barring national power companies and tightening regulation of utilities in an effort to counteract their tendency to create markets that work only for insiders. The broad goals of trading are the same Trebing said. The goal is to maximize profits through raising prices. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: EOL Body:: Is this it? I thought we had heard it from 3 or 4 sources. Enron Capital & Trade Resources Corp. From: Rebecca W Cantrell @ ECT 05/24/2001 11:30 AM To: Steven J Kean/NA/Enron@ENRON cc: Leslie Lawner/NA/Enron@Enron Christi L Nicolay/HOU/ECT@ECT Joe Hartsoe/Corp/Enron@ENRON Linda Robertson/NA/Enron@ENRON James D Steffes/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Subject: Re: EOL The attorney for SoCal Edison mentioned it to Randy Rich when they were discussing the data request that SoCal Edison sent ENA/EES in the CPUC complaint proceeding. However it has not been brought up in any of the testimony filed in the case nor raised at the hearing. Steven J Kean@ENRON 05/23/2001 05:34 PM To: Leslie Lawner/NA/Enron@Enron Christi L Nicolay/HOU/ECT@ECT Rebecca W Cantrell/HOU/ECT@ECT Joe Hartsoe/Corp/Enron@ENRON Linda Robertson/NA/Enron@ENRON James D Steffes/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron cc: Subject: I just spoke with Clark Smith head of Elpaso's merchant arm. I told him that we had been hearing that El Paso was blaming Enrononline for problems in Western gas markets. He asked for some more specifics about who exactly was spreading the rumor (I told him we had heard it from 3-4 sources). He acknowledged that EOL was not the problem said he couldn't believe that it had been identified as such and said he would bring it up on his call with his Washington team this afternoon. I think he will put it to rest (except for whatever damage has already been done). I did promise to get some more specifics on who has told us that El Paso pointed to us. Can anybody give some info on that? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Risk 2001 Australia Body:: Thanks Vince - I'll give him a try. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EES Talking ABout Sending Back the New SDG&E Customers -- PLEASE READ Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Executive Committee List - Updates Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: In Washington DC - fly in from Chicago this morning. I told Cynthia that you could start meetings at 10:30. Body:: Lou -- Dist Gen issue LEFF Nicki Daw -- 011-44-171-316-5457 9/25 - Cy knows to hold off on scheduling more meetings until further notice. Senator Bumpers with Harry McPherson - 2:30 3:30 Senator Crapo Cynthia will do other meetings trying for Pallone Gorton Grams. You can leave on 5:10 flight. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Lay-Fox meeting Body:: No contact Rosalee Fleming (ken's assistant). I let her know that you would be preparing the briefing. Ricardo Charvel@ENRON 08/03/2000 08:30 PM To: Steve Kean Richard Shapiro/HOU/EES@EES cc: Subject: Lay-Fox meeting Do we have an estimated deadline for presenting the info to Ken Lay? Please let me know. Ricardo What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Natural Gas in the 21st Century: The Shape of Things to Come Body:: Ken Lay speaking and James J. Hoecker What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Update -- Project 100 Body:: It's fine with me. Mary Clark 09/27/2000 11:23 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: Update -- Project 100 Steve our theme for the stock celebration is Oh The Places You'll Go which is the title of a Dr. Seuss book. Everyone on the team loves this idea because the messages in the book represent Enron thinking and culture. In case you aren't familiar with the book Beth Tilney has a copy. Our plan is to give every employee a book which will have a note of appreciation on the inside cover from Ken Jeff and Joe. We are contacting Random House (who will contact the Seuss estate) to see if we can purchase 20000 copies and to get permission to use some of the copy in our internal communication materials. The per unit cost is considerably lower due to the volume. We think employees will like this idea. What do you think? Mary What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Rice Happy Hour Body:: Steve will be in a Managing Director PRC that day - not sure if he will be out in time for a 5:30 event. Maureen From: Lexi Elliott/ENRON@enronXgate on 06/21/2001 01:39 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Rice Happy Hour Steve: I am considering scheduling a Rice team/intern happy hour on July 24 (5:30 - 7:00). Would you be available on this date or should I try to reschedule? Thank you! lexi 3-4585 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Greening the Enron Building Mtg Body:: fyi What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Enron Corporation Body:: Neither Ken nor Jeff are available. It would probably be better for one of you to speak anyway. Any interest? ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: TACT Conference Speaker Request Body:: This looks like a run-of-the-mill conference except that the guest list is fairly senior. Any interest? If not let Amy know. ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PRIVILEGED & CONFIDENTIAL Attorney/Client Communication: Your TW Capacity Options questions Body:: Elizabeth Jeff forwarded me your questions about capacity options. I've answered them to the extent they involve legal/regulatory issues. If you need anything further please don't hesitate to call. ? Can a new shipper who enters into an FTS-1 contract with zero MDQ in order to purchase a shipper call option or sell a transporter put option be allowed prior to the exercise date to transfer the underlying option rights by permanently releasing this contract? YES. ? Will we be required to report these contracts with zero MDQ on the Index of Customers and/or the Transactional Report? YES. ? Can the releasing shipper permanently release a portion of his existing MDQ and choose to keep or transfer the option rights? YES. The shipper could even release all of its MDQ (reducing it to zero) and keep its option rights. ? How is it determined whether a contract with an option amendment is within the min/max tariff rate or needs to be filed as a negotiated rate? The option fee is converted to a per-Dth per day rate and added to the transport rate. If the total exceeds the maximum tariff rate it's negotiated. Otherwise our position is that it's not negotiated. We are not 100% positive that FERC will agree with us on this issue. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: California Update 07.18.01 Body:: These are useful updates. Please include Whalley Lavorato Parquet Dietrich Delainey Kitchens Haedicke Sanders Kirby Sharp Leff Calger Belden etc on future updates. Thanks From: Jeff Dasovich on 07/18/2001 08:18 PM Sent by: Jeff Dasovich To: Richard Shapiro/NA/Enron@Enron skean@enron.com Susan J Mara/NA/Enron@ENRON Harry Kingerski/Enron@EnronXGate James D Steffes/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Susan M Landwehr/Enron@EnronXGate mpalmer@enron.com Karen Denne/Enron@EnronXGate Janel Guerrero/Enron@EnronXGate Paul Kaufman/Enron@EnronXGate cc: Subject: California Update 07.18.01 The Senate the Assembly and the Governor are either poised to engage in very difficult negotiations or the three are about to crash and burn and Edison's going to be left dangling. In the Senate: The Senate bill 78XX is with about 90% likelihood going to be voted out of the Senate tonight---without a vote having taking place in any committee. Burton announced during one of the two informational hearings that this is it despite the view of just about everyone who appeared before the committees the bill likely won't prevent Edison from going bankrupt. The key features of the bill are: Banks and QFs get paid in full. Edison shareholders would be responsible for debts owed to suppliers No direct access. There are conflicting reports about whether the Senate will take up the bill tomorrow de-linking the bonds from the DWR contracts and whether the Republicans will go along with it. In the Assembly: The Committee is hearing the Wright and Hertzberg bills as we speak with Hertzberg's the likely winner. That bill now provides for Direct Access under certain conditions (the amendments describing the conditions were faxed today). We're attempting to get the July 12 date changed to the effective date of the bill or later. The Assembly likely won't vote the Hertzberg bill out until tomorrow at the earliest. The Problem: The Assembly and Senate bills are diametrically opposed in the way each approaches the problem---in short the bills are two ships passing in the night. The Democratic leaders (Governor Hertzberg Burton) aren't talking and Burton hasn't expressed any interest in talking---to anybody. The likely outcome given the circumstances: Burton says he's done what he needs to do (i.e. passed out a fair bill) the Assembly and Senate can't agree they finish the budget time runs out they leave Friday and Edison's left twisting. That said there's still a chance that the Governor could call Burton and sit down with Burton and Hertzberg and work something out by Friday or begin talking and postpone the recess until they get it worked out. But given Burton the chance of that happening seems very slim. In short little has changed since yesterday. Best Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: re: On Workplace Sleeves, Few Political Hearts Body:: The PAC did not give the money. PAC contributions to federal candidates are limited. The money was a combination of individual contributions Ken solicited and soft money donations to the Republican Party. 09/12/2000 10:33 AM Erin Rice Erin Rice Erin Rice 09/12/2000 10:33 AM 09/12/2000 10:33 AM To: Steven J Kean/NA/Enron@Enron Elizabeth Linnell/NA/Enron@Enron cc: Subject: re: On Workplace Sleeves Few Political Hearts I think I understand why people get confused now. See below in blue..... I know you mean the Enron PAC has contributed more than $615k to the Bush campaign (right?) but it reads like Enron Corp gave money directly to Bush. It's a complicated issue -- which I am hoping to simplify with my story! I'm going to use the second quote below in the article. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: AG letter - privileged and confidential: request for legal advice. Body:: The letter looks good. A couple of comments for your consideration: On page three we describe the change to the definition of Public Utility and then argue that we don't fit into it. Would it be worth explaining why that makes sense? Specifically the New Jersey restructuring law like most efforts of its kind in other markets is designed to separate the competitive from monopoly elements of the power (and gas) businesses. Economic regulation would then be restricted to the remaining monopoly elements of the business (eg distribution). The competitive market can not be solely relied upon to regulate the behavior of monopoly asset owners such as distribution utilities. Therefore regulators continue to be called upon to set pricing and other terms of service. What those regulators decide matters a great deal to those monopoly utilities and it consequently makes sense for lawmakers to be concerned about attempts by such entities to use campaign contributions to tacitly influence decision makers. The same public policies simply do not apply to that portion of the market which is competitive. The generation and sales business has a competitive structure (i.e. relatively low barriers to entry multiple competitors etc.). These components of the power and gas business can be regulated by the market with respect to rates and terms of service. They do not require economic regulation any more than grocery stores department stores appliance sellers or other retailers (who presumably are not prohibited from making contributions. Competition and markets discipline behavior and establish competitive prices and terms of service. Because regulators don't set the prices and terms of service for such sellers there is no reason to be concerned about campaign contribuitions from such organizations. Indeed the legislation and the legislative history clearly conform to this underlying policy rationale. As a former practicing lawyer I certainly understand the value of pleading in the alternative. But I question how certain of our arguments woud be perceived by the public if they ever came to light (which these documents have a habit of doing).. . I can just see the press seizing on Enron's claim of ignorance or mistake or the fact that we pled for the favorable exercise of prosecutorial discretion. I suggest that we add whatever we feel is necessary to the very solid looking intent argument not make specific reference to ignorance or mistake and not plead for the favorable esxercise of PD. If we feel we need to write about this last item perhaps we could suggest that it would be a waste of the public's resources to pursue a claim under such circumstances. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Corporate Allocations April 2001 Body:: Is this a 2001 question? If so it seems to me we shouldn't bother with it. If this is a 2002 question then lets discuss ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: NEWS FLASH ON THIS MORNINGS SENATE HEARING Body:: This morning all 5 FERC commissioners testified before the Senate Energy Committee on yesterday's order and on the pending Feinstein/Smith legislation to impose cost-of-service rates on wholesale power. Highlights and analysis are as follows: 1. Sen. Feinstein the chief sponsor of Senate price cap legislation called FERC's order a giant step forward and said she is very grateful for what the commission did. Senators Gordon Smith and Barbara Boxer agreed. Sen. Feinstein said that she and Sen. Smith would now recommend to Chairman Bingaman that next week's mark up of their price control bill be postponed for the time being pending how the order plays out in practice. Chairman Bingaman said he would follow their advice and cancel next week's mark up. (Responding to a question each of the five commissioners said that Congress should NOT act to pass Smith/Feinstein at least at this time -- this included Comr. Massey who has favored legislation in the absence of stronger action by the commission.) 2. However it is very important to point out that House Democrats in California and elsewhere out West have not been as supportive of FERC's order as have the Senators. House Democrats are still expected to attempt to offer a price control amendment to the supplemental appropriations bill when it comes before the House later this week. Of course the reaction of the Senate may undercut the House Democrats's argument at least at this time. Furthermore should prices go up and the FERC order is seen as not working price control advocates including Sens. Feinstein Smith and Boxer will no doubt pick up where they left off. 3. It will be very interesting to see how Senator Lieberman and Gov. Davis react to the FERC order at the Senate Governmental Affairs Committee hearing tomorrow morning. While this committee does NOT have legislative jurisdiction over the Feinstein/Smith legislation this hearing will be well covered by the news media. Sen. Lieberman is a cosponsor of the Feinstein/Smith legislation. 4. In my view the political and public pressure will now shift in large part -- at least for the time being -- from the legislative price cap proposals to the settlement conference process that the FERC order will set motion. There was a clear drum beat at the hearing from the western senators particularly Feinstein Boxer and Cantwell (WA) for refunds either out of the settlement conference or ordered by FERC. In essence they are pressing to have the price mitigation formula in the new order applied to power sales that took place prior to the issuance of the order. 5. Another sense of the poltiical flavor is that Sen. Schumer (D-NY) while expressing his continued support for deregulatioin and competition pressed FERC general counsel Kevin Madden (by this point the commissioners left for the RTO conference) about why the order applied only to the WSCC and did not apply nationwide. Madden at least tried to distinguish the New York and California markets but then said that Con Ed has filed pleadings with FERC to extend price mitigation to New York and he could not say any more about the matter. 6. Ranking Republican Frank Murkowski said he had received a letter today from four western governors -- those from Arizona North Dakota Utah and Wyoming -- saying that since FERC has acted there is no need for Congress to pursue price control legislation. There were a series of questions and comments on details and technical aspects of the orders. I will do an e-mail on these items later today. Please advise if you have any questions or comments. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Rick Shapiro Presentation (Updated) Body:: ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: enron advisory council Body:: Forgive me if I have forgotten but had you suggested a topic for our next advisory council meeting? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ELECTRICITY TRADED VOLUMES since 1994 Body:: I think he was looking to make a sector-wide point. For example how much of the total market moved to wholesale traded volumes? He wants to make the point that even a nontraded commodity - ie electricity in 1994 - can rapidly progress to a traded market - as electricity did between 94 and 00. Margaret Carson 09/21/2000 04:25 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: ELECTRICITY TRADED VOLUMES since 1994 Steve I provided Andy West with this and the 35 percent a year growth was compelling Marg. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: PG&E PX Credit Calculation -- CONFIDENTIAL ATTY CLIENT WORK PRODUCT Body:: I assume that if an hourly PX market clearing price is mitigated per a FERC order it would affect variable HC in the formula laid out in the attachment. It is not clear to me which variable represents hourly ISO imbalance energy costs but I assume its Est RT$. If I am right that variable would be affected by the mitigated market price (MMP) for CAISO imbalance energy. My comments are: The FERC is able to only order refunds to jurisdictional entities and given appeals it may take years before the full extent of thre refunds are known. Therefore there will be a significant difference between the change in the mitigated market price (MMP) as declared by FERC and the PX credit. That is a 10% reduction in the MMP should not be construed as having a 10% effect on the PX credit assuming it can be recalculated at all. Specifically only some of the HC or Est RT$ costs can be adjusted per FERC refund orders. Also the PX credit is a tariffed rate. I do not believe the PU code allows for retroactive adjustments to tariffed rates unless there was an explicit cost tracking account (e.g. a balancing A/C). To my knowledge no such account exists here. Finally I do not see a relationship between MMPs and (1) block forward costs on any date and (2) PG&E and/or DWR's procurement costs for the net short position post January 19. So those PX credit costs should be unaffected by any FERC refund order. Alan Comnes What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: draft organization announcement. Body:: Attached is the draft. It combines all three announcements into one with a common format. It reflects a just the facts approach. Let me know if you have changes (or answers to the questions in the text). What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: New Cost Memo Body:: See my revisions (and one question). Let's revise and circulate. Karen Denne 06/06/2001 05:57 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: New Cost Memo What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: ENE Officer Elections Body:: No. We have reallocated some of the responsibilities but Cindy has a significant part of the HR organization and continues to manage Community Relations so her title is accurate. Thanks From: Kelly Johnson/ENRON@enronXgate on 07/19/2001 01:06 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: RE: ENE Officer Elections Thanks Steve. Do we need to change Cindy Olson's title? Let me know. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Conference call with Rick, Mark, Dan Clearfield, Steven Shackman. 800-283-1805, in EB0653 Body:: Lisa Freeman MW Daily --703-816-8625 fax 703-528-7821 Joe Daughen (Phil Daily News) -- 215-854-5939 fax (215) 854 5910 Rich Heidorn (Phil Inquirer 215 - 854-4502 Fax: 5553 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Suzanne Brown in your office. Body:: Hartsoe-Commissions order on 75 O888 compl programs Maya WeberGordon Weil Dave Marquart Richard Tabors What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: IHI Arbitration: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT COMMUNICATION Body:: Don't forget to call. My curiosity level is high. 713-853-5587 Gail Brownfeld/ENRON@enronXgate 03/07/2001 03:50 PM To: Richard B Sanders/HOU/ECT@ECT cc: Subject: RE: IHI Arbitration: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT COMMUNICATION I'll call you in a little bit. We'll be finishing up in about 45 minutes. Let's just say Greg is earning his fee. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Confidential A&A PRC Results Body:: I had not seen it yet. Do you have my other employees rankings? Since they reccomend that the PRC Representative be involved in providing feedback would you like to do that next week when you are here? Mark Barry Tycholiz/ENRON@enronXgate 08/02/2001 10:18 AM To: Mark Whitt/NA/Enron@Enron cc: Subject: FW: Confidential A&A PRC Results I assume you received this information already and I know that we have not discussed Tyrell being ranked here. The #1 spot was tightly held by only a few people ( in the americas and as such everyone was moved down... Although the forced ranking creates problems at time I am satisfied that Ty's ranking is appropriate... let's discuss BT What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: HP -- confidential internal document Body:: Jennifer Thank-you for stepping in on this and guiding the process! ----------------- What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Possible Enron Visit to Tulane Univ. Late March or April Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Video Screens in EB Elevator Cabs Body:: Please add Terrie to the meeting with Beth Bill Palmer et al ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: draft organization announcement. Body:: Attached is the draft. It combines all three announcements into one with a common format. It reflects a just the facts approach. Let me know if you have changes (or answers to the questions in the text). What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Trip to California Body:: Frank Sorry for a delay in responding to your message. As you can imagine after Jeff Skilling's resignation Greg Whalley will be tied up in a few additional stock analysts' presentations. We are still planning trips to California and New Mexico that we would like to combine and would like very much to meet and exchange opinions with you. Please advise me about your availability during the next 2 - 3 weeks. Hopefully we can reconcile our schedules and meet soon. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Political Contributions Body:: Please add Linda Robertson (Head of our DC office) to this list if that's ok. Sally Keepers 05/04/2001 03:04 PM To: Steven J Kean/NA/Enron@Enron Elizabeth Labanowski/EPSC/HOU/ECT Carolyn Cooney/Corp/Enron@ENRON cc: Subject: Political Contributions Attached is final list for 2000 What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - May 2001 Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Test Message Body:: Shirley Approved. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Alberta PPA Body:: ditto -- nice work Rob. Your insights on project stanley are also much appreciated. ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Enron Advertising Body:: Let's ask Jeff Hines(?) our opinion research guy to put a few short questions together and send it out. We may also want to include a link so people can view the commercials again before answering. Also I was talking with Beth Tilney today about our website (and the fact that every business unit now feels free to go do their own thing). We thought it would be a good idea to add this topic to the brand conference (perhaps as part of an existing segment). ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Revised INGAA Itinerary Body:: FYI - itinerary. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Comments of Wolak Body:: Wolak makes some good points. In ERCOT Enron is in support of nodal pricing. I would not go so far as to say we are pushing for PJM's implementation however but for a market with nodal prices (and unilateral bids - aka unbalanced schedules congestion reflect by price differentials etc). I was unaware PJM had such great power to alter bids. This is something we don't want and something for which I am not aware we have advocated. Perhaps in Enron's promotion of locational prices it has been retold as PJM-style locational prices. Given that PJM is the most commonly cited example of locational prices it does not surprise me to have the sloppiness in discussions that could lead to the rumors. Martin What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Fellow referred to me by Ken Lay Body:: yes Jeff Dasovich Sent by: Jeff Dasovich 03/13/2001 12:10 PM To: skean@enron.com cc: Subject: Re: Fellow referred to me by Ken Lay Steve: Based on the note from Rosalee and if you agree I'm going to assign low priority to the issue. Jeff Rosalee Fleming 03/13/2001 08:46 AM To: Steven J Kean/NA/Enron@Enron Jeff Dasovich/NA/Enron@Enron cc: Vanessa Groscrand/Corp/Enron@ENRON Subject: Re: Fellow referred to me by Ken Lay Hi Steve and Jeff - This was a cold call to Ken that Vanessa took while we were in Exec. Comm. meeting. She had asked Ginger who to refer him to as it was CA. and she mentioned Jeff. Please only call if there is any interest. Rosie From: Steven J Kean on 03/12/2001 04:46 PM To: Jeff Dasovich/NA/Enron@Enron cc: Vanessa Groscrand/Corp/Enron@ENRON Rosalee Fleming/Corp/Enron@ENRON Subject: Re: Fellow referred to me by Ken Lay It was not mentioned to me. I'm copying rosie and vanessa to find out if this was a simple referral (in which case you should keep the work to a minimum -- return the call but don't get distracted from your other efforts) or whether Ken is especially interested in this and wants us to follow through. Jeff Dasovich Sent by: Jeff Dasovich 03/12/2001 03:54 PM To: skean@enron.com cc: Subject: Fellow referred to me by Ken Lay Just got a call from a fellow named Jame Edgerly at the Enterprise Zone Inc. He told me that Ken Lay (through Ken's secretary Vanessa) referred me to him. He is very interested in getting us to help him work with the Legislature to establish an Enterprise Zone energy tariff to encourage investment in California's Enterprice Zones. Before I launch on the effort just wanted to check in and see if this rings a bell with you. Thanks. Best Jeff What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Downtown Arena- HHCC asked to give public comments to Construction Committee this week Body:: I would like your insights. Meredith I'd like yours as well (particularly in light of the messageyou received from Lawson and Jefferson). Laura Schwartz@ENRON 08/02/2000 08:22 AM To: Steven J Kean/HOU/EES@EES cc: Subject: Re: Downtown Arena- HHCC asked to give public comments to Construction Committee this week Steve Please let me know if there is anything you would like me to do regarding this matter. Thanks Laura ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Department meeting conference call. 800-283-1805, in Ricks name. Body:: Paul Jacarty Andy Keleman Jack Heath Jeff Brockmeyer 1-800-348-4825 2760 -- Andy Fastow Janine Migden What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Houston 1996 - 2001 Body:: I am so sorry. You guys gave him a really good life. Robert Kean on 07/07/2001 01:48:08 PM Please respond to To: Pat Hilleman \(E-mail\) Greg Smith \(E-mail\) Greg Smith \(E-mail 2\) Colin Lamb \(E-mail\) Maggie Kean \(E-mail\) Nora Kean \(E-mail\) Nora Kean \(E-mail 2\) Sann & Evelyn Gossum \(E-mail\) Doug & Karen Reiman \(E-mail\) Jean Kean \(E-mail\) Kathy Wedig \(E-mail\) Melissa Kean \(E-mail\) Phil Kean \(E-mail\) Steve & Melissa Kean \(E-mail\) cc: Subject: Houston 1996 - 2001 Houston died today after a long battle with Auto Immune Hemolytic Anemia. Rest in peace. Rob Kean What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Legislative Status Report Week Ending 2/23 Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Summary of Todays FERC Order Body:: This morning the FERC had its meeting to discuss events in California and = =20 the FERC=01s response to them. The following is a summary of the remarks o= f=20 the four Commissioners and the major points of what has been ordered:=20 ? Major features ? 1.? Proposes to replace ISO and PX boards with independent non-stakeholde= r=20 boards. 2.? Continued significant role for the presidents of PX/ISO who should be= =20 made voting members. 3.? Elimination of mandated buy-sell requirement for the IOUs (although no= =20 explanation as to whether this requires CPUC action). Over-reliance on spo= t=20 markets has been problematical. 4.? As an independent exchange the PX will be free to design the products= =20 desired by the market. 5.? The proposed price modification measure will be a temporary measure.= =20 Single price for all offers below $150. However no bid above $150 will se= t=20 the price for all generators. A seller can bid anything it wants. Allowing = =20 generators to receive their as-bid price will allow high-cost generators to= =20 participate in the market. However the generator will be required to=20 provide confidential reports to FERC explaining the necessity for bids ove= r=20 $150 through 12/31/02. 6.? The order requires forward scheduling of 95% of an scheduling =20 coordinator=01s schedule with a penalty applied for deviations which exce= ed 5%=20 As an incentive the proceeds of the penalties go to the schedulers who=20 comply with the tolerance band. 7.? Rejects the purchase price caps proposed by the ISO. The order would= =20 eliminate the ISO=01s price cap authority. 8.? Beginning 1/1/01 the prospect of refunds will be available. =20 ? Commissioner Hebert ? Due to a technical problem when I called in I heard only part of his =20 remarks. He announced that he will have a separate concurrence in the order= =20 but is troubled by some of its features. The $150 cap is questionable=20 whether described as a Soft cap or as a hard cap. His concern is that it will clearly discourage new investment in generatio= n.=20 He therefore recommended that the $150 cap should be escalated on a regula= r=20 basis (perhaps every six months) until it reaches at least $250.=20 ? He points out that the ISO and PX are required to make RTO filings to FERC = =20 on 1/16/01. These filings should address the major aspects of the Order=20 issued today.=20 ? Hebert also questioned the issue of refunds alleging that it was =20 disingenuous to suggests that refunds were a possible remedy.=20 ? Commissioner Breathitt=20 ? Breathitt announced almost all of the foregoing major points of the orderT= he=20 order is based on a market approach. In choosing our market-based approac= h=20 it is our goal to guide the markets to self-correct and not re-institute= =20 command and control regulation.? We have all worked too hard too long t= o=20 have this result. ? Commissioner Massey ? Sixty-five years ago the Congress decreed that prices had to be just and = =20 reasonable.? There is no exception for market-based approaches. He will =20 concur as the order does find that prices have been unjust and=20 unreasonable. The order does insure that prices should return to being jus= t=20 and reasonable. Cited Frank Wolak as proposing there ought to be an 18-24= =20 month forward product designed which the CPUC will years ago federal law= =20 dictated that prices had to be just and reasonable. The $150 is a soft cap and allows a generator to bid above it but if it= =20 does it will not set the price which other generators receive. He invites = =20 comments on this issue.=20 With regard to retroactive refunds the Office of the General Counsel has= =20 prepared a legal memorandum which concludes that the FERC probably does not= =20 have authority to order refunds retroactively for any date before October 2= =20 2000. Invites comments on this issue.=20 California needs new generation and transmission and the siting authority= =20 belongs to the state. California must do its part to ensure that customers= =20 do in fact benefit from competitive markets that ensure just and=20 reasonable prices.=20 He is not yet confident that the Commission has taken all necessary steps.= =20 ? Chairman Hoecker ? He strongly supports the order.=20 Comments are due in three weeks. This is no time to pull punches. He cited= =20 the San Diego hearings as indicating that California markets were? out o= f=20 synch with the needs of the digital economy.? For FERC regulators who are= =20 used to corporate struggles among utilities and other large companies th= is=20 was a real eye-opener.=20 Average citizens had no warning this was going to happen and they had no= =20 competitive alternatives. It was unfair to them and there is plenty of = =20 responsibility for this meltdown to go around.=20 If I was a senior citizen in San Diego living on a fixed income or a sma= ll=20 business owner living on a small profit margin or a school administrator = =20 dealing with a tight budget the doubling of my bill would make me want my= =20 money back or to at least ensure that this won=01t happen again in the= =20 future. Many who expected this order expected a lynching and the transfer of lar= ge=20 amounts of money. They want us to round up the bad guys who manipulated th= e=20 market and order the disgorgement of their ill-gotten gains. As our legal= =20 opinion indicates that=01s not going to happen.? Today=01s order offer= s a=20 thoughtful way back to a rational basis for buying and selling power in th= e=20 West. We are not ignoring actual or undue discrimination or actual abuses of =20 market power. The order makes better market monitoring going forward a =20 fundamental part of FERC=01s proposal.? If evidence of such behavior is = =20 brought forward FERC will act on that information. However we can=01t d= elay =20 work on a market fix while searching for the culpable parties.=20 Hoecker believes that strong federal action is both warranted and =20 important at this moment.? The bulk power grid must be made to work =20 efficiently across the entire West.=20 Competition is at risk make no mistake about that. In view of the =20 California experience several states are reconsidering or shelving plans t= o =20 implement competition.? Legislators will want to retain the possibility of= =20 returning to the old days of vertically-integrated utilities.? The =20 California experience has been instructive but not helpful=01(to the=20 meandering implementation of competition throughout the nation.=20 The state=01s markets have not been mistakenly federalized as alleged b= y=20 some. The markets are regional. California=01s access to interstate power = =20 supplies is critical as was made evident by recent events. If we do things= =20 right California will not be a federal enclave designed to satisfy our=20 market predilections it will be a workable and competitive market that=20 benefits consumers.=20 This is a strong order. It needs to be a strong order. We expect to have = a=20 strong order in December and the public needs it.=20 A copy of these notes are attached if you need to distribute them to anyon= e=20 in your organizations. - November 1 2000 Meeting Notes.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Pre-Election Discounts! Body:: Any interest? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Thanks anyway. no need to do anything right now. enjoy your vacation. Jeffrey Keeler 06/18/2001 01:10 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Re: Sorry I missed this on Friday -- was on vacation end of last week and rest of this week. If its not too late I'll have Lisa pull some things together quickly. Also my wife Marietta knows Isikoff well....they worked together on a number of things when she was at Court TV in Washington. Let me know what I can do to help. Jeffrey Keeler Director Environmental Strategies Enron Washington DC office - (202) 466-9157 Cell Phone (203) 464-1541 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: ATTORNEY/CLIENT COMMUNICATION//////CONFIDENTIAL and Privileged Body:: Article II of the NONCOMPETITION AGREEMENT entered in connection with the sale of HPL to AEP (which closed as of June 12001) provides: ENA [for 3 months post-close] will not solicit negotiate or enter into any contract agreement or arrangement for the purchase of natural gas on the HPL Pipeline from any Person which is a supplier or producer of natural gas connected to the HPL Facilities provided however nothing herein shall be construed or interpreted as prohibiting ENA from entering into any such contract agreement or arrangement which is less than one month in duration and involves or is related to an Enron Online transaction. This is not the most clearly drafted provision as it was the subject of much negotiation....and was significantly narrowed from the original scope proposed by AEP. Thus please consult with me prior to entering into any solicitation agreement or arrangement which might arguably be covered by our limited covenant not to compete on the supply side for 3 months. There are many aspects of the post-close transition which will require cooperation between Enron and AEP/HPL and thus it behoves us to carefully weigh the risks and rewards of stepping too close to or over the line. Furtheralthough a technical reading of the non-competition agreement only applies to ENA no ENA UPSTREAM deals which would violate this covenant if there were to be done as ENA should be done without clearance from Brian Redmond and me. Please communicate this restriction to those who report to you and have need to be aware of this limited restriction. Sincerely BNG Dan J Hyvl 06/07/2001 04:59 PM To: Barbara N Gray/HOU/ECT@ECT cc: Jeffrey T Hodge/HOU/ECT@ECT Subject: ONEOK Energy Marketing and Trading Company Barbara This appears to be supply deal for deliveries at Katy that would be subject to the 90 day non-compete. Sandi is in the process of getting me a copy of the non-compete so that I can determine if this deal is covered. Do you have any thoughts. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CPUC Postpones action on Direct Access Until Mid-August Body:: Please add Dave Delainey John Lavorato and Louise Kitchens to updates with significant news like this one (they may already get them ... I didn't read through all the names). Susan J Mara 07/03/2001 12:35 PM To: Alan Comnes/PDX/ECT@ECT Angela Schwarz/HOU/EES@EES Beverly Aden/HOU/EES@EES Brenda Barreda/HOU/EES@EES Carol Moffett/HOU/EES@EES Cathy Corbin/HOU/EES@EES Chris H Foster/HOU/ECT@ECT Christina Liscano/HOU/EES@EES Christopher F Calger/PDX/ECT@ECT Craig H Sutter/HOU/EES@EES Dan Leff/HOU/EES@EES Debora Whitehead/HOU/EES@EES Dennis Benevides/HOU/EES@EES Don Black/HOU/EES@EES Douglas Huth/HOU/EES@EES Edward Sacks/Corp/Enron@ENRON Eric Melvin/HOU/EES@EES Erika Dupre/HOU/EES@EES Evan Hughes/HOU/EES@EES Fran Deltoro/HOU/EES@EES Gayle W Muench/HOU/EES@EES Ginger Dernehl/NA/Enron@ENRON Gordon Savage/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Harry Kingerski/NA/Enron@ENRON James D Steffes/NA/Enron@ENRON James W Lewis/HOU/EES@EES James Wright/Western Region/The Bentley Company@Exchange Jeff Messina/HOU/EES@EES Jeremy Blachman/HOU/EES@EES Jess Hewitt/HOU/EES@EES Joe Hartsoe/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON Kathy Bass/HOU/EES@EES Kathy Dodgen/HOU/EES@EES Ken Gustafson/HOU/EES@EES Kevin Hughes/HOU/EES@EES Leasa Lopez/HOU/EES@EES Leticia Botello/HOU/EES@EES Mark S Muller/HOU/EES@EES Marsha Suggs/HOU/EES@EES Marty Sunde/HOU/EES@EES Meredith M Eggleston/HOU/EES@EES Michael Etringer/HOU/ECT@ECT Michael Mann/HOU/EES@EES Michelle D Cisneros/HOU/ECT@ECT mpalmer@enron.com Neil Bresnan/HOU/EES@EES Neil Hong/HOU/EES@EES Paul Kaufman/PDX/ECT@ECT Richard L Zdunkewicz/HOU/EES@EES Richard Leibert/HOU/EES@EES Richard Shapiro/NA/Enron@ENRON Rita Hennessy/NA/Enron@ENRON Robert Badeer/HOU/ECT@ECT Rosalinda Tijerina/HOU/EES@EES Sarah Novosel/Corp/Enron@ENRON Scott Gahn/HOU/EES@EES Scott Stoness/HOU/EES@EES Sharon Dick/HOU/EES@EES skean@enron.com Susan J Mara/NA/Enron@ENRON Tanya Leslie/HOU/EES@EES Tasha Lair/HOU/EES@EES Ted Murphy/HOU/ECT@ECT Terri Greenlee/NA/Enron@ENRON Tim Belden/HOU/ECT@ECT Tony Spruiell/HOU/EES@EES Vicki Sharp/HOU/EES@EES Vladimir Gorny/HOU/ECT@ECT Wanda Curry/HOU/EES@EES William S Bradford/HOU/ECT@ECT Jubran Whalan/HOU/EES@EES Richard B Sanders/HOU/ECT@ECT Robert C dwatkiss@bracepatt.com rcarroll@bracepatt.com Donna Fulton/Corp/Enron@ENRON gfergus@brobeck.com Bruno Gaillard/EU/Enron@Enron Linda Robertson/NA/Enron@ENRON Ren Lazure/Western Region/The Bentley Company@Exchange Michael Tribolet/Corp/Enron@Enron Phillip K Allen/HOU/ECT@ECT Christian Yoder/HOU/ECT@ECT jklauber@llgm.com Tamara Johnson/HOU/EES@EES Greg Wolfe/HOU/ECT@ECT Jeff Dasovich/NA/Enron@Enron Dirk vanUlden/Western Region/The Bentley Company@Exchange Steve Walker/SFO/EES@EES James Wright/Western Region/The Bentley Company@Exchange Mike D Smith/HOU/EES@EES Richard Shapiro/NA/Enron@Enron Leslie Lawner/NA/Enron@Enron Robert Steve Walton/HOU/ECT@ECT psmith3@enron.com mjackso7@enron.com Janel Guerrero/Corp/Enron@Enron Mark Fillinger/SF/ECT@ECT Jennifer Rudolph/HOU/EES@EES Martin Wenzel/SFO/HOU/EES@EES wgang@enron.com Joseph Alamo/NA/Enron@Enron Ray Alvarez/NA/Enron@ENRON David Leboe/Enron@EnronXGate Jay Zoellner/Western Region/The Bentley Company@Exchange Fatimata Liamidi/HOU/EES@EES Sonia Perez/HOU/EES@EES Chris Holmes/HOU/EES@EES Venkatesh Mani/Western Region/The Bentley Company@Exchange Richard Crevelt/Western Region/The Bentley Company@Exchange Dave Perrino/SF/ECT@ECT Malcolm Adkins/HOU/EES@EES Kevin Keeney/HOU/EES@EES Chris Stokley/ENRON@enronXgate Steve C Hall/ENRON@enronXgate Tracy Ngo/Enron@EnronXGate triley@enron.com cc: Subject: CPUC Postpones action on Direct Access Until Mid-August The vote to suspend direct access has been postponed. This is a positive sign that the legislature is making progress on a comprehensive solution. Sue Mara Enron Corp. Tel: (415) 782-7802 Fax:(415) 782-7854 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RTO Question Body:: For those who attended the FERC meeting yesterday can anyone elaborate on the reference in the Energy Daily article today that said Pat Wood remarked at the meeting that the Barton RTO language is balanced and that he likes it. I am working on our own and helping EPSA with their comments on the Barton language which is as we know a retrenchment from current law and FERC's plans on RTOs. But if Pat Wood likes it and thinks it is balanced that undercuts our position. Since the trade press is not always accurate I thought I would first check with those of you who were there. Thanks. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Corporate Farewell Lunch for Ed Segner, in wine room at Brennans - Not going Body:: I've RSVP'd for you. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FWD: News Article Body:: At the end of the article there is a presidential straw poll. It shows Bush with only a 6 point lead among oil and gas industry executives and analysts. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Request for PR2 Access Body:: OK From: Jo Ann Hill/ENRON@enronXgate on 07/18/2001 04:31 PM To: Steven J Kean/NA/Enron@Enron cc: Kathryn Schultea/ENRON@enronXgate Mary Joyce/ENRON@enronXgate Subject: FW: Request for PR2 Access Steve -- For your approval. As some additional information regarding the request Kathy Diane Taylor and I met with Deana Taylor this afternoon to understand what each person's role was and the specific access needed. For the interim we are recommending that the HR View Basic Data & Org ENTP and View Payroll and Time ENTP role be granted to each of the individuals listed below. Until January 1 this function was performed in the Payroll Department and at that time was transitioned to Karen and Deana's group. The people listed below actually transferred from the Payroll Department. For the long term we are going to look at creating a specific role for this group that would let them access only those data elements needed. I've spoken with Mary Joyce by phone and she has approved so I am requesting your approval as well. These people have basically been prevented from being able to reconcile any of the net pay accounts etc. for the past week. Please let me know if you will approve or if you need any additional information. Thanks. Jo Ann What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - Decision tree on projects Body:: Something for us to talk about during our next staff meeting. There are three projects which have significant cash flow problems and thus= difficulties in meeting debt obligations: these are: SECLP Panama and Gaz= a. In the past as I suppose we have done in Dabhol we have taken the pos= ition that we would not inject cash into these companies and would be prepa= red to face a default and possible acceleration of the loans. SECLP has be= en the biggest issue/problem. Panama is much less (a few million of floati= ng of our receivables from the company) would be sufficient to meet the cas= h crunch in April of this year. Note that in Panama the debt is fully gu= aranteed by the government and is non-recoursed to the operating company B= LM. In the past we have discussed letting the debt default which would c= ause the bank to potentially seek complete payment and acceleration from th= e GoPanama. The reason: the vast majority of BLM's problems stem from acti= ons taken by the regulator that have effectively amended our PPA's with pri= vate parties those actions resulted in significant loss of revenues which= although today have stopped or have been limited have left a mark on th= e company's liquidity position. =20 Now the question is: come April of 2002 should any of our actions in Panam= a or decisions related thereto (which we would have otherwise taken or made= ) be affected in any way by either the proposed merger or an effort by Enro= n to preserve efforts to re-establish investor/creditor confidence? The sa= me could go for SECLP and Gaza. This is simply an overall guidance question. Let's take it up during our= staff meeting next week if that's ok with you. Many thanks Mariella What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Invitation to the EUROFORUM Conference ""Emissions Trading"" Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential - Decision tree on projects Body:: 2 meetings on monday 8 & 9:30 and 2 on friday 9 & 10. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: UC-CSU-Enron press release Body:: Is there an alternative quote we could use instead of the reference to stabilizing in the California market? I think I know what we mean but most outside readers would see the situation as unstable. Perhaps we could reference the continued availability of direct access or renewed interest in Enron's offerings? To: Marty Sunde/HOU/EES@EES Janet R Dietrich/HOU/EES@EES Elizabeth Tilney/HOU/EES@EES Peggy Mahoney/HOU/EES@EES Vicki Sharp/HOU/EES@EES Robert C Williams/Enron@EnronXGate Steven J Kean/NA/Enron@Enron Karen Denne/Corp/Enron@ENRON Mark Palmer/Corp/Enron@ENRON James D Steffes/HOU/EES@EES Evan Hughes/HOU/EES@EES cc: Subject: UC-CSU-Enron press release Attached is a draft of the UC-CSU-Enron press release concerning the settlement agreement. Please review and let me know of any revisions or suggestions. We would like for this to go out tomorrow if possible. We're still waiting for a quote from CSU. I'll make sure you see that as well. Thank you. Max What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:KITCHEN LOUISE - +1 713 853 3488 Enron Wholesale Services - Office of the Chairman From: Mark Frevert Chairman & CEO Mark Haedicke Managing Director & General Counsel Subject: Confidential Information and Securities Trading To keep pace with the fluid and fast-changing demands of our equity trading activities Enron Wholesale Services (EWS) has recently revised its official Policies and Procedures Regarding Confidential Information and Securities Trading (Policies and Procedures). These revisions reflect two major developments: (1) our equity trading activities have been extended into the United Kingdom and (2) in an effort to streamline the information flow process the Review Team will play a more centralized role so that the role of the Resource Group is no longer necessary.You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: If you have already certified compliance with the Policies and Procedures during the 2001 calendar year you need not re-certify at this time although you are still required to to review and become familiar with the revised Policies and Procedures. If you have not certified compliance with the Policies and Procedures during the 2001 calendar year then you must do so within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CONFIDENTIAL AND LEGALLY PRIVILEGED Body:: Marcus David roland will be point person on this. I assuming you are getting bankruptcy etc advise and there will be consideration etc. corporate formalities will be followed etc. From: Marcus Nettelton/ENRON@enronXgate on 10/31/2001 11:29 AM To: Vicki Sharp/HOU/EES@EES cc: Mark E Haedicke/Enron@EnronXGate Subject: CONFIDENTIAL AND LEGALLY PRIVILEGED CONFIDENTIAL AND LEGALLY PRIVILEGED Vicki Many thanks for your assistance yesterday. Clinton Energy Management Services Inc. because it holds a current power marketing certificate is an entity which we would like to move to being a direct subsidiary of Enron Corp. to take effect today. This is considered to be an essential part of restructuring to meet our current and future needs. While the day to day control will remain where it is and all the efforts assign contracts and other work should progress as planned since the value to Enron Corp. is the power marketing certificate nothing should be done to jeopardize this. In addition we will be changing the charter and will need copies of the existing charter to effect those changes required. Please call me if you need to discuss this further. Kind regards Marcus What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CATS House of Lords Appeal Body:: fyi ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Fri 5/4: Expect prices to shoot up analysts say Sac Bee Fri 5/4: GOP: Shrink plan for bonds Sac Bee Fri 5/4: FERC chief defends plan for state Sac Bee Fri 5/4: PG&E to judge: ISO $1 billion tab will drain us Sac Bee Fri 5/4: Jack Sirard: PG&E's woes a warning to utility investor= s SD Union (AP) Fri 5/4: Legislature sends power authority bill to govern= or LA Times Fri 5/4: GOP Tries to Force Its Dramatically Different Energy Plan on Governor LA Times Fri 5/4: Secretary of Energy Davis Meet on U.S. Plan to Boost Conservation LA Times Fri 5/4: PG&E Seeks Relief From High-Priced Power Purchases LA Times Fri 5/4: SDG&E Blackout Plan Would Pay Firms to Use Generators= SF Chron Fri 5/4: Been there done that=20 Bay Area finds little new in Bush's ideas SF Chron Fri 5/4: Bush calls power supply the solution=20 He says conservation useful but secondary SF Chron (AP) Fri 5/4: SDG&E unveils plan to contend with rolling=20 blackouts SF Chron (AP) Fri 5/4: California crisis brings new talk of energy=20 conservation=20 SF Chron (AP) Fri 5/4: Developments in California's energy crisis SF Chron Fri 5/4: Energy at a glance SF Chron Fri 5/4: Ships would help during blackouts=20 Ready reserve fleet has power to provide=20 SF Chron Fri 5/4: PG&E chairman wants to keep power lines Mercury News Fri 5/4: Bush shifts policy on conservation after meeting= =20 with GOP Mercury News Fri 5/4: Senate plans public power Mercury News Fri 5/4: All Caps Hed OC Register Fri 5/4: Energy notebook Vote delayed on $12 billion state bond for power OC Register Fri 5/4: US conservation order called Bush's best effort Individual.com (Bridgenews) Fri 5/4: [B] POWER UPDATE/ Bush directs fed= s to save energy in California Individual.com (AP) Fri 5/4: Judge Dismisses $10B PG&E Suit Individual.com (Business wire) Fri 5/4: Bankruptcy Update/ PG&E Files= =20 Motion to Require CAISO to Follow Federal Law --- Expect prices to shoot up analysts say By Dale Kasler Bee Staff Writer (Published May 4 2001)=20 Gov. Gray Davis' plan for solving the energy crisis relies partly on a=20 striking assumption: that the state's power expenditures will drop=20 dramatically this summer.=20 But energy-market analysts believe Davis is underestimating the cost of=20 electricity and say the state should brace for a significant run-up in pric= es=20 during what is likely to be a summer of chronic shortages.=20 In particular analysts question Davis' prediction the state will pay an=20 average of $195 a megawatt-hour on the spot market from July to September = a=20 44 percent reduction from the projected average price for April through Jun= e.=20 One hundred and ninety-five dollars? Boy I wish it were true said Sever= in=20 Borenstein of the University of California Energy Institute. My estimate i= s=20 substantially higher.=20 Yet Davis' advisers are sticking by their projection of the state's power= =20 costs released Monday to a skeptical Legislature by private consultants to= =20 the governor. They say the lower cost estimates reflect expected increases = in=20 supplies the projected impact of California's new conservation program and= =20 the state's growing ability to wean itself from the ultra-expensive spot=20 market and buy much of its power through cheaper long-term contracts.=20 Prices may rise but spending by the state will decline starting this=20 summer they insist.=20 This is a very credible plan said Joseph Fichera a Wall Street financie= r=20 advising the governor. We have done things to mitigate our exposure (to th= e=20 spot market).=20 The credibility of the projections is crucial to the state's plan to sell $= 10=20 billion worth of bonds -- a key element of Davis' rescue plan. The bonds=20 would compensate the state for past and future power purchases made on beha= lf=20 of moribund Southern California Edison and Pacific Gas and Electric Co. wi= th=20 ratepayers ultimately footing the bill. Davis expects the state to spend=20 $18.7 billion on power by June 2002.=20 But if electricity costs go higher than Davis expects the strain on the=20 state's budget could worsen complicating the bond sale. Republican=20 lawmakers wary of higher costs and distrustful of Davis' projections have= =20 been threatening to block the sale.=20 Higher-than-expected costs also would increase the likelihood of blackouts= =20 Davis acknowledged last week that the state might stop purchasing electrici= ty=20 at times when prices go out of sight.=20 And many private-sector experts believe prices will surely rise.=20 I see no reason given what's happened the past six months that the next= =20 six months is going to be dramatically different said Keith Bailey chief= =20 executive of generator Williams Cos. which sells power to California.=20 One great unknown is the impact of a price mitigation plan approved last= =20 week by the Federal Energy Regulatory Commission. Price caps would kick in= =20 when California's power reserves are less than 7 percent of demand -- the= =20 so-called power alert days.=20 Bailey said the plan would have a very real effect but state officials= =20 called it inadequate. More holes than Swiss cheese Davis said this week.= =20 In Washington Sen. Dianne Feinstein D-Calif. and other Western senators= =20 tore into FERC Chairman Curtis Hebert Jr. at a hearing on the price=20 mitigation plan. Feinstein wondered aloud why the FERC didn't simply=20 establish a firm ceiling on prices.=20 As it stands now California officials have been spending upward of $50=20 million a day for Edison and PG&E the tab can fluctuate wildly from day to= =20 day as prices shoot up and down. On Thursday prices in California ranged= =20 between $214 and $240 a megawatt-hour depending on location for peak-time= =20 power according to industry newsletter Enerfax Daily.=20 Because summertime demand is typically about 50 percent higher than it is i= n=20 spring most analysts expect prices to rise. California electricity futures= =20 prices considered by many to be a decent gauge of where prices are going= =20 are trading at $375 a megawatt-hour for July and $525 for August Enerfax= =20 said.=20 I would trust the traders said Gary Ackerman of the Western Power Tradin= g=20 Forum an association of power generators. They've been right more often= =20 than the Davis administration.=20 The Northwest drought robbing California of cheap hydropower is a key=20 reason many analysts believe costs won't drop.=20 What it all adds up to is much less imported hydroelectric power than we'r= e=20 used to said Arthur O'Donnell editor of the California Energy Markets=20 newsletter.=20 But Davis' consultants say new power is coming from other sources this=20 summer easing prices. New power plants scheduled to begin operations this= =20 summer will add 4500 megawatts of power to California's energy-starved=20 grid Davis said.=20 O'Donnell though said the new plants won't provide immediate relief. Pow= er=20 plants in their start-up phase frequently have problems he said.=20 Another unknown quantity is the fate of hundreds of cogenerators wind farm= s=20 and other alternative-energy providers that deliver more than 20 percent of= =20 the state's electricity under contract to the utilities.=20 After going months without payment from PG&E and Edison scores of these=20 producers shut down in February and March depriving the state of an=20 estimated 3000 megawatts of power and contributing mightily to two days of= =20 blackouts in March.=20 About 800 megawatts of power returned to service in April after PG&E and= =20 Edison were ordered to resume paying the generators the two utilities said= .=20 And Fichera said more will come back starting June 1 when their contracts= =20 say they must operate or face financial penalties.=20 But some generators say they won't produce full throttle this summer. Anger= ed=20 at a new payment schedule that substantially cuts their income they'll run= =20 the absolute bare minimum to fulfill their contracts said Hal Dittmer of= =20 Wellhead Electric Co. a small generator that's been shut down.=20 Representatives of the small generators met with Davis on Thursday with=20 Davis agreeing to work with them on the possibility of increasing their=20 payments said generators' attorney Jerry Bloom.=20 Davis meanwhile also is betting that energy usage will fall. Recently=20 approved rate hikes will create sticker shock that will cut demand 3=20 percent Fichera said. The state's conservation program will contribute an= =20 additional 4 percent he said.=20 If we buy less than what (generators) expect prices drop Davis said.=20 Above all the state has completed or is in final negotiations on a slew of= =20 long-term contracts with major generators -- deals that will substantially= =20 cut the state's dependence on the spot market and reduce its overall power= =20 bill said Ron Nichols of Navigant Consulting Inc. which developed the=20 power-cost estimates for Davis.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m.=20 David Whitney of The Bee's Washington Bureau contributed to this report.=20 GOP: Shrink plan for bonds By John Hill Bee Capitol Bureau (Published May 4 2001)=20 The state should bite the bullet and use $5 billion of its surplus to pay f= or=20 electricity instead of borrowing the money and prolonging the fiscal agony= =20 Assembly Republicans said Thursday.=20 Paying up front is preferable to a Democratic plan that would saddle=20 electric customers with higher utility rates to pay the state back with=20 interest said Assemblyman Bill Leonard of San Bernardino one of 30 membe= rs=20 of the Assembly Republican Caucus.=20 But the caucus's plan drew fire from state Treasurer Phil Angelides a=20 Democrat in charge of putting together the bond deal. He said a GOP block o= f=20 the bond deal would cut into this year's spending for education and=20 transportation and take the state toward fiscal insolvency.=20 Angelides said the Republican stance will force the Legislature to pass the= =20 bill authorizing bonds with a simple majority needing no GOP votes but=20 requiring a 90-day wait for the bill to become law. By that time he said= =20 the state will be perilously close to running out of money.=20 It is to me from a business perspective one of the most irresponsible ac= ts=20 I've witnessed he said.=20 The Assembly Republican plan calls for the state to sell $8 billion in bond= s=20 instead of the $12.5 billion proposed by Gov. Gray Davis. This move would= =20 relieve pressure for more electricity rate increases Leonard said.=20 The Republicans would make up the difference by taking $5 billion from the= =20 state's general fund. That's money the Democratic governor proposed in=20 January would go to one-time expenditures on a variety of projects from=20 clean beaches to housing as well as new spending on schools.=20 The Republican plan calls for rate rebates for people whose electric=20 utilities are publicly owned such as the Sacramento Municipal Utility=20 District. Some argue that these ratepayers are getting a bad deal because= =20 their tax money is subsidizing ratepayers whose utilities are in financial= =20 trouble.=20 It also includes past Republican proposals that have stagnated in the=20 Legislature such as allowing residential customers to make deals with=20 independent electricity providers and encouraging quick building of power= =20 plants.=20 Although the Republicans are in the minority they wield leverage in the=20 energy debate because a bill that would authorize a bond sale requires a=20 two-thirds vote. At least five of the 30 Assembly Republicans would have to= =20 vote for it.=20 The Republicans say they are uncomfortable with the size of the bond deal= =20 proposed by Davis which combined with other energy bond sales could top $2= 0=20 billion. It's too much to swallow said James Fisfis a spokesman for the= =20 caucus.=20 Fisfis said the plan represents a preliminary response to Democratic=20 proposals -- a starting point in negotiations and a vision of Republicans= =20 and what they would do if they were governing.=20 We don't want those phony messages that everything's fine and hunky-dory= =20 and it's not he said. This is a time for financial restraint.=20 The Republican proposal blasts as expensive gimmickry a plan by Angelides= =20 to get a $4.1 billion bridge loan from three major lenders to keep the stat= e=20 flush until the bonds are sold.=20 Angelides said such loans are routine when California and other states sell= =20 bonds. The loan in this case he said provides momentum for what's likel= y=20 to be the biggest bond sale in U.S. history. It's three of the most powerf= ul=20 investment banks in the country side by side with us signalling to the wor= ld=20 marketplace that they believe in this transaction he said.=20 The fees to the investment banks of several million dollars represent a=20 fraction of one day of the state's power costs he said.=20 Legislative Analyst Elizabeth Hill said the proposal would require all $2.3= =20 billion in one-time expenditures in the governor's budget to be axed as we= ll=20 as $2.7 billion of proposed year-to-year spending.=20 In addition state revenues for the fiscal year starting July 1 appear to b= e=20 lower than anticipated so the Republican plan might force even more cuts= =20 she said.=20 The Republican caucus plan came the same day that Secretary of State Bill= =20 Jones the lone Republican statewide officeholder and a GOP candidate for= =20 governor next year released his own ideas on the energy crisis.=20 Jones in a letter to Vice President Dick Cheney said the state is on the= =20 brink of fiscal insolvency because of Davis' efforts to buy power.=20 Instead of selling bonds or negotiating to buy the utility companies'=20 transmission lines or other assets the state should ask power generators t= o=20 forgive some of the nearly $14 billion they're owed in exchange for immedia= te=20 payment Jones said.=20 In addition the state should offer low-interest loans to utilities to help= =20 them repay their debt using the power lines as collateral. Finally he sai= d=20 the utilities' parent companies should help reduce the debt.=20 While Jones said the Davis plan is socializing the delivery of power the= =20 state Senate on Thursday sent the governor a bill that will likely drive th= e=20 state further into the energy business by allowing a public power authority= =20 to run its own power plants.=20 The authorizing bill SB 6x by state Senate President Pro Tem John Burton= =20 D-San Francisco passed the Senate on a 24-14 party-line vote.=20 The agency would have access to $5 billion in bond money with which it coul= d=20 build run and seize power facilities and institute conservation programs.= =20 The Bee's John Hill can be reached at (916) 326-5543 or jhill@sacbee.com.= =20 Kevin Yamamura of The Bee Capitol Bureau contributed to this report.=20 FERC chief defends plan for state=20 By David Whitney and David Westphal Bee Washington Bureau (Published May 4 2001)=20 WASHINGTON -- The chairman of the Federal Energy Regulatory Commission=20 sternly defended the panel's new plan for controlling California electricit= y=20 prices Thursday amid mounting criticism that it is too little and too late = to=20 do much good.=20 The criticism came from Democrats and one Republican Oregon Sen. Gordon=20 Smith at a hastily arranged hearing of the Senate Energy and Natural=20 Resources Committee that was intended to be a forum for FERC Chairman Curt= =20 Hebert Jr. to dispel concerns that the plan won't protect consumers from=20 price-gouging electricity marketers.=20 The order approved last week by a 2-1 vote is supposed to dampen prices= =20 without rigid price controls by ordering generators to sell all the power= =20 they produce and setting a benchmark price based on the highest-cost=20 least-efficient plant operating during periods of emergency shortages.=20 FERC is acting Hebert said. FERC is acting responsibly. ... We're doing= =20 what we can do.=20 But the commission's lone dissenter on last week's order William Massey= =20 charged that the measures to control skyrocketing prices would be in effect= =20 only during power emergencies when supplies were tightest. And while that= =20 might be as much as 40 percent or 45 percent of the time during the long ho= t=20 summer he said that still leaves most of the time when power marketers ar= e=20 free to sell at whatever price they can get.=20 I have no confidence that prices will be fair and just at all times this= =20 summer Massey said.=20 Sen. Dianne Feinstein D-Calif. continued on that theme. She produced what= =20 was described as a megawatt laundering blueprint she had received detaili= ng=20 how FERC's order could be used to trade power back and forth between=20 marketers to bid up wholesale prices in a way that would be outside FERC=20 monitoring.=20 The contentious hearing came as the FERC is about to publish notice in the= =20 Federal Register to expand the price monitoring plan to Oregon Washington= =20 and other Western states.=20 But Smith said he thought the commission was misreading the political=20 firestorm brewing throughout the West if it thought its plan would quell=20 outrage over rising prices.=20 Are you aware of the head of steam that is building up? asked Smith who= =20 said prices in his region are 10 or 12 times what they were a year ago. Th= is=20 is unsustainable for this administration for this Congress.=20 Smith and Feinstein have introduced legislation that would temporarily cap= =20 wholesale power rates at the cost of production plus a fixed profit margin.= =20 Feinstein who was more supportive of the FERC order after its release last= =20 week said after the hearing that she now believes it is flawed by too many= =20 loopholes and problems.=20 I can't understand why they are doing this she said.=20 Meanwhile one of California's biggest power customers the U.S. military= =20 vowed Thursday to reduce its peak-hours electricity use by 10 percent this= =20 summer as President Bush expressed new concern about the state's looming=20 season of blackouts.=20 We're worried about blackouts that may occur this summer and we want to be= =20 part of any solutions said Bush who gave federal officials 30 days to=20 implement electricity-reducing plans.=20 Gov. Gray Davis welcomed the president's comments but said the plan falls= =20 short. Surely the federal government can do more and match California's 20= =20 percent savings at all state buildings he said.=20 Vice President Dick Cheney in a speech earlier this week spoke dismissive= ly=20 of conservation efforts in the 1970s and warned that the nation won't be= =20 able to simply conserve or ration our way out of the situation we're in.= =20 But Bush spoke repeatedly Thursday of the importance of conserving. We've= =20 got to do both he said. We must conserve but we've also got to find new= =20 sources of energy.=20 The administration set no target for reducing federal power use but=20 recommended actions such as turning off escalators and raising thermostats = to=20 78 degrees when state reserves fall below 5 percent.=20 We're not trying to pick a figure arbitrarily out of the sky said Energy= =20 Secretary Spencer Abraham.=20 Earlier in a letter to Congress Davis excoriated federal inaction on=20 soaring electricity rates as he prepared to meet in Sacramento with Abraham= =20 on Thursday evening.=20 With all our actions in California it is a travesty that on the one issue= =20 over which the federal government has exclusive jurisdiction -- wholesale= =20 energy prices -- it has utterly failed to discharge its responsibility=20 Davis said.=20 The Bee's David Whitney can be reached at (202) 383-0004 or=20 dwhitney@mcclatchydc.com.=20 PG&E to judge: ISO $1 billion tab will drain us By Claire Cooper Bee Legal Affairs Writer (Published May 4 2001)=20 SAN FRANCISCO -- Pacific Gas and Electric Co. asked a federal bankruptcy=20 judge Thursday to bar the operator of California's power grid from buying= =20 electricity for the utility or collecting almost $1 billion now due for pas= t=20 wholesale purchases.=20 PG&E's bankruptcy estate would be depleted by paying the high prices passed= =20 on by the California Independent System Operator the utility said in askin= g=20 U.S. Bankruptcy Judge Dennis Montali to issue an injunction.=20 PG&E filed for Chapter 11 bankruptcy reorganization April 6. The utility's= =20 corporate parent San Francisco-based PG&E Corp. is not part of the=20 bankruptcy proceedings.=20 The ISO buys electricity from independent wholesalers to supplement whateve= r=20 power the utilities can send to the grid matching supply with demand on a= =20 daily basis. Throughout the past year it has provided as much as 30 percent= =20 of the state's electricity and as little as 10 percent on any given day sa= id=20 ISO spokesman Patrick Dorinson.=20 ISO Vice President Elena Schmid said Thursday that the ISO stopped buying= =20 electricity for PG&E after being told to do so April 6 by the Federal Energ= y=20 Regulatory Commission because the utility no longer was creditworthy.=20 But the PG&E legal complaint said the ISO continued making purchases throug= h=20 April 30 at an average cost almost six times as high as the frozen retail= =20 rates that PG&E can charge its customers.=20 Even with an upcoming rate increase said the complaint PG&E could lose $2= 28=20 million a month if it depended on the ISO for 25 percent of its electricity= .=20 Since mid-January the California Department of Water Resources also has be= en=20 buying electricity for PG&E and Southern California Edison under AB 1x=20 legislation that authorized state power purchases and rate increases if=20 necessary to repay the state.=20 PG&E said in the complaint that the state water department has limited its= =20 purchases to power it can buy at rates it deems reasonable leaving it to t= he=20 ISO to obtain at extremely high rates the remainder of the electricity PG= &E=20 needed to balance supply and demand.=20 PG&E has been able to generate or has contracts for between 50 percent and = 60=20 percent of its retail electricity demand.=20 PG&E spokesman Ron Low said the DWR has been buying about 85 percent of the= =20 balance but the company doesn't know how much the ISO is buying until it= =20 receives the bills.=20 ISO's Schmid said no decision had been reached concerning the effect of the= =20 bankruptcy proceedings on PG&E's outstanding billion-dollar bill for=20 electricity purchases in January and February.=20 We're certainly going to live by whatever terms the Bankruptcy Court puts = on=20 it she said.=20 Two weeks ago ISO advised PG&E that ISO's January and February invoices t= o=20 the extent they conflicted with the bankruptcy process were submitted only= =20 for record-keeping purposes.=20 But PG&E said ISO still plans to hold the company responsible for the bills= .=20 A hearing has been set for June 4.=20 The Bee's Claire Cooper can be reached at (415) 551-7701 or=20 ccooper@sacbee.com.=20 Jack Sirard: PG&E's woes a warning to utility investors (Published May 4 2001)=20 Q: Like so many other investors I bailed out of my Pacific Gas and Electri= c=20 shares. I am now looking at Con Ed. It looks fairly priced with a great=20 yield. Would it be wise to take the money I got from PG&E and buy Con Ed?= =20 My biggest concern is that Con Ed could suffer a fate similar to the one th= at=20 devastated PG&E. What do you think?=20 --Robert A. Carmichael=20 A: Consolidated Edison (ticker symbol ED) is one of the nation's largest=20 investor-owned energy companies. The company provides a wide range of=20 energy-related services to customers in New York New Jersey and=20 Pennsylvania.=20 For the three months ended March 31 revenues increased 24 percent to $2.89= =20 billion while its net income declined 5 percent to $179.1 million.=20 The company's stock closed Thursday at $36.26 near its 52-week high of=20 $39.50 and well above its low of $29.61. The company pays a generous annual= =20 dividend of $2.20 a share giving it a current yield of 6.04 percent.=20 Last week the company said it would spend $483 million this year as part of= a=20 program to prepare for the summer of 2001 enhance reliability and improve= =20 infrastructure. And over the next five years Con Ed plans to invest $2.4= =20 billion to upgrade its electric delivery system which serves New York City= =20 and Westchester County.=20 You're certainly right to be concerned about any utility's plans to deal wi= th=20 the energy crisis.=20 Here's what I found about Con Ed. The company sold most of its power plants= =20 and like California utilities failed to lock in multiyear contracts with= =20 suppliers to protect its customers against rising wholesale prices. But Con= =20 Ed can pass wholesale electricity price increases through to consumers. Las= t=20 summer a spike in wholesale prices briefly pushed Con Ed electric rates up= =20 43 percent and that could happen again this summer.=20 Value Line says Con Ed stock is expected to lag the market but says=20 income-oriented investors might want to build a stake. The company has been= =20 increasing its dividend slowly but surely over the years. If you buy the=20 stock keep a close eye on it. Utilities unfortunately no longer can be= =20 bought and tucked away.=20 Q: Our gross income is $100000 a year and other than our house payment w= e=20 have no outstanding debt except a car payment of $250 a month. We have abou= t=20 $175000 in investments including our stocks mutual funds and 401(k) whic= h=20 we are adding about $1000 a month to.=20 We have two kids age 10 and 12 and hope to retire from our jobs with the= =20 state in about seven years at age 53 to 55 and convert our investments to 2= 5=20 percent CDs 25 percent bond funds 25 percent stocks and 25 percent mutual= =20 funds. What do you think?=20 --Jim R. Sacramento=20 A: After looking at the stocks (down 74 percent) and mutual funds (down 51= =20 percent) that you have bought on your own I'd suggest that you need=20 professional help with your investing. Admittedly you have taken a hit by= =20 being heavily invested in technology components. By comparison your 401(k)= =20 is down only 23 percent.=20 Instead of being concerned about how to invest once you retired if I were= =20 you I'd focus my attention on whether I had enough money to retire. Becaus= e=20 you and your spouse both work for the state your retirement benefits shoul= d=20 be solid but I think you need to get a professional review of your financi= al=20 situation to see if all the numbers add up. At first glance it doesn't loo= k=20 to me that they do.=20 You're at the age when you need to have a financial game plan in place that= =20 can pay for college for the children and your own retirement. In your case = --=20 as with many others -- spending some time and money now with a professional= =20 will pay off in the future.=20 The Bee's Jack Sirard can be reached at (916)321-1041 or jsirard@sacbee.com= =20 Legislature sends power authority bill to governor=20 By Audrey Cooper ASSOCIATED PRESS=20 May 3 2001=20 SACRAMENTO =01) California is poised to enter the power business after the = state=20 Senate approved the creation of a public power authority and sent its bill = to=20 Gov. Gray Davis Thursday.=20 A power authority supporters said will give the state more control over i= ts=20 wholesale electricity market by building and operating its own power plants= .=20 State-owned plants could charge lower prices and building new plants could= =20 increase supply and ease wholesale prices.=20 If signed by the Davis the bill creates a California Consumer Power and=20 Conservation Financing Authority that could issue up to $5 billion in reven= ue=20 bonds to pay for power plants natural gas storage and additional pipelines= =20 and conservation programs.=20 Davis has said he supports creating a public power authority similar to one= =20 in New York. The New York authority has 10 power plants 1400 miles of=20 transmission lines and produces about 25 percent of the state's power.=20 Nebraska also has a power authority which created a market in which=20 residents pay 22 percent less than the national average said Sen. John=20 Burton D-San Francisco who wrote the bill.=20 A Davis spokesman said Thursday that although the governor has supported th= e=20 concept of a power authority he has not decided whether or not to sign the= =20 legislation.=20 The authority would be run by the state treasurer and four other members=20 appointed by the governor.=20 Opponents of the plan most of them Republicans have said an authority=20 thrusts the state into a power market in which it doesn't belong and could= =20 obstruct private interests' efforts to build and operate power plants.=20 The new board would also be able to seize plants by eminent domain a power= =20 the governor also has under an emergency order issued in January.=20 Sen. Steve Peace D-El Cajon said California needs the authority because t= he=20 1996 deregulation law didn't create real competition and the Federal Energy= =20 Regulatory Commission refuses to control rising wholesale prices.=20 The state's deregulation is the economic equivalent to the World Wrestling= =20 Federation Peace said. The wrestlers follow a script and the referee=20 FERC ensures it is entertaining. It is not real competition.=20 The authority won't help the state escape blackouts this summer but will= =20 help restore reliable and affordable electricity in the future said consum= er=20 advocate Harvey Rosenfield with the Foundation for Taxpayer and Consumer=20 Rights.=20 The agency is California's key to survival and independence from the energ= y=20 cartel he said.=20 Davis and state lawmakers are also considering purchasing Southern Californ= ia=20 Edison's transmission system which would be governed by a separate public= =20 authority. Negotiations with San Diego Gas & Electric Co. are continuing. T= he=20 Legislature would have to approve those buys.=20 The authority's main power would be over generator construction said=20 Stanford University economist Frank Wolak. Energy companies would likely be= =20 hired to build the plants something the companies are already pursuing.=20 As far as operating power plants we're not as good as these other guys=20 are he said.=20 However the authority may speed the siting of power plants an approval=20 process mostly anchored in state agencies. Centering the approval process i= n=20 the state government could speed the process he said.=20 Richard Sklar the governor's new energy czar said the goal of the state's= =20 power authority will be to balance the energy market in California and keep= =20 private companies from controlling the prices.=20 The power authority is a sensible long-term strategy Sklar said. It's n= ot=20 a bad idea for the state if the private sector will not build it to build= =20 plants so supply won't fall short of demand and this game won't be able to = be=20 played.=20 Opponents said California should create total deregulation of the electrici= ty=20 market not a government solution.=20 The 24-14 vote on the bill written by San Francisco Democratic Sen. John= =20 Burton was split down party lines.=20 Some of the most feared words in the English language are 'I'm from the=20 government and I'm here to help you' said Sen. Bill Morrow R-Oceanside.= =20 The state Assembly passed the bill last week in a 47-28 vote split along=20 party lines.=20 Pacific Gas and Electric Co. spokesman Ron Low declined comment on the=20 legislation. Officials from San Diego Gas and Electric Co. didn't return=20 calls seeking comment.=20 ?? Read Burton's SB6X www.leginfo.ca.gov=20 GOP Tries to Force Its Dramatically Different Energy Plan on Governor=20 By MIGUEL BUSTILLO Times Staff Writer=20 ?????SACRAMENTO--Republican lawmakers are trying to force Gov. Gray Davis= =20 into a dramatically different exit strategy for the energy crisis: writing= =20 off the $5 billion the state has already spent on electricity and borrowing= =20 billions less to finance future power purchases. ?????GOP lawmakers are holding up emergency legislation needed to replenish= =20 the budget for power costs because they don't think the Democratic=20 governor's plan to get California out of the power business will work. They= =20 say the plan is full of dangerously optimistic assumptions such as estimat= es=20 that 90% of the state's alternative energy producers will be generating=20 electricity this summer--only two-thirds are now--and that Californians wil= l=20 use 7% less electricity. ?????Although Republicans don't control either house the emergency=20 legislation requires a two-thirds vote which gives the GOP significant swa= y. ?????The plan from the Republican leadership would commit taxpayer money fo= r=20 the first time to an electricity problem that has only affected customers o= f=20 private utilities. Because the plan is sure to draw strong opposition from= =20 politicians in Los Angeles and other areas served by public power agencies= =20 Republicans have included a complex $1.5-billion proposal to provide refun= ds=20 to those served by municipal utilities. ?????By blocking the emergency legislation Republicans may stop state=20 Treasurer Phil Angelides from securing a $4.13-billion loan to repay state= =20 coffers for electricity purchases--a failure that would reduce the money=20 available to Davis for his next budget and possibly delay his plan to resol= ve=20 the energy crisis. Angelides needs the bill to guarantee repayment for the= =20 loan. ?????If Angelides does not obtain legislative approval by Monday he will= =20 miss a Tuesday deadline lenders had given him to close the loan. That would= =20 clearly leave Davis with less money for new education police and=20 road-building programs as he begins planning his next budget this month. ?????Moreover failure to pass the bill could delay a record bond issue tha= t=20 Davis promised would replenish the budget and shield it from further energy= =20 drains by summer. And it could harm sagging confidence on Wall Street that= =20 California can deliver on its plans to manage the energy crisis Angelides= =20 said. ?????California's credit rating has already been downgraded by one credit= =20 agency Standard & Poor's largely because of concerns about the effect of= =20 electricity purchases on state finances. ?????Negotiations Are Continuing ?????The Republicans appear to be digging in and playing a dangerous game = of=20 financial roulette with the state. This is really ludicrous to me Angelid= es=20 said. Standard & Poor's has already downgraded us. The other credit rating= =20 agencies are watching. I just don't understand what the Republicans are=20 thinking. ?????Said Assembly Republican leader Dave Cox (R-Fair Oaks): We're not=20 prepared to give the governor a blank check. ?????Democrats threatened Thursday to test the Republicans' resolve by=20 bringing the bill to a vote in the Assembly but backed down. Negotiations= =20 among legislative leaders continue. ?????To avoid widespread blackouts the state government entered the=20 electricity-buying business in January after the private utilities became t= oo=20 burdened with debt to continue purchasing power on the expensive wholesale= =20 market. ?????Under a plan approved by the Legislature and signed into law by Davis= =20 the state budget is to be repaid for the power purchases through a massive= =20 municipal bond issue expected to be the largest in American history. The= =20 bonds in turn are to be paid off by utility ratepayers through a slice of= =20 their monthly bills. ?????However the plan was based on the premise that the state would quickl= y=20 bring down power costs by entering into long-term contracts with suppliers-= -a=20 scenario that has yet to materialize. ?????In fact California's power costs have gone up since January. Lawmaker= s=20 initially estimated that $10 billion in bonds would allow the budget to be= =20 repaid and cover future power purchases. Davis is now proposing $12.5 billi= on=20 in bonds--and higher electric bills--to finance the state's costs until 200= 3. ?????Republicans are convinced that it will not be enough. They say the=20 Angelides bridge loan is not needed because the state has money in various= =20 funds that could cover power purchases well into the fall. ?????They also confess to political considerations. Republican legislators= =20 believe that by allowing Angelides to obtain his loan now they will be=20 powerless to oppose further borrowing later. The loan Angelides set up with= =20 J.P. Morgan Chase and several other financial services companies is to be= =20 repaid with the bond issue. If the loan is not repaid by the end of the=20 summer the interest rate will rise dramatically a situation that would ma= ke=20 it hard for the minority Republicans to oppose more bonds. ?????The strong GOP views were shaped in part by Democratic state Controlle= r=20 Kathleen Connell who met with Republican legislators earlier this week and= =20 shared a highly critical appraisal of Davis' plan. ?????Connell told the Republicans that the governor's strategy was based on= a=20 series of assumptions about electricity market conditions in California thi= s=20 summer that in her view are highly improbable. ?????It is almost impossible for all these hypothetical situations=20 envisioned in their scenario to occur at once Connell said. ?????But even if all the assumptions came to pass she predicted that=20 California would still need to secure another source of financing by next= =20 spring to continue energy purchases. Davis administration officials have=20 rebutted her claim. ?????I am deeply troubled by this incremental approach to this financing= =20 that is long-term in nature and is going to burden the state for many years= =20 Connell said in what appeared to be a reference to Davis' reputation as a= =20 plodder.=20 ?????Using Surplus to Pay for Electricity ?????Republicans who have traditionally been opposed to financing public= =20 programs with large bond issues contend that Davis needs to reevaluate his= =20 plan. By proposing to essentially forget the $5 billion the state has spent= =20 so far on power they are advocating using up the state's projected budget= =20 surplus on electricity costs even if it means cutting new government=20 programs. ?????If Gov. Davis continues down this path he could bankrupt the state= =20 said Assemblyman Dennis Mountjoy (R-Monrovia). That would have a far great= er=20 impact on education. ?????Democrats who strongly believe that the surplus should be invested in= =20 roads schools and to meet other long-term future needs are unlikely to ev= er=20 support the idea. Lawmakers are already discussing outflanking the=20 Republicans by drafting a bill to repay the budget on a nonemergency basis= =20 which would only require a majority vote. ?????That however would probably delay the financing until at least Augus= t=20 since nonemergency measures do not take effect for 90 days--giving Californ= ia=20 only about six weeks to cut the largest municipal bond deal ever before sta= te=20 coffers begin to empty according to Angelides. ?????There is another potential consequence: Many of the long-term contract= s=20 the Davis administration has reached to purchase electricity contain clause= s=20 that may make them void if the state does not obtain financing by July. ?????This is a very dangerous game Angelides said. ?????In other electricity developments Thursday: ?????* Over Republican objections Democrats in the state Senate approved a= nd=20 sent to Davis a far-reaching bill that would put state government in the=20 business of operating its own power plants and selling electricity at cheap= er=20 rates than private companies. The bill SB 6x by Senate leader John Burton= =20 (D-San Francisco) would create a state power authority with the ability to= =20 finance buy own and build generation plants and sell the energy at=20 cost-based rates. ?????on likened the proposed government body to the New York Power Authorit= y=20 approved by GOP Gov. George Pataki which brought about a 10% reduction in= =20 rates. ?????The difference from the current situation is that the people of=20 California the ratepayers would benefit and not the corporate officers a= nd=20 not the shareholders of private energy companies Burton said. ?????But Republicans attacked the power authority as more government that= =20 would impose itself on an enterprise better suited for private operators wi= th=20 years of expertise. ?????This is a horrific mistake and one that California ratepayers will be= =20 paying for many years to come said state Sen. Tom McClintock (R-Thousand= =20 Oaks.) ?????* California Secretary of State Bill Jones a GOP gubernatorial hopefu= l=20 released his plan to address the electricity crisis criticizing Davis'=20 efforts as a state takeover of the power industry. ?????Jones called on the utilities' parent companies to help bail out their= =20 troubled subsidiaries and said creditors should accept lower payments on ba= ck=20 debts. He also called for creation of a state-federal emergency management= =20 plan to deal with any blackouts this summer. Jones made his three-page=20 proposal in a letter to Vice President Dick Cheney head of the Bush=20 administration's energy task force. ---=20 ?????Times staff writers Carl Ingram in Sacramento and Mark Z. Barabak in L= os=20 Angeles contributed to this story. Copyright 2001 Los Angeles Times=20 Secretary of Energy Davis Meet on U.S. Plan to Boost Conservation=20 Crisis: Federal buildings and military bases accounting for 1.5% of state'= s=20 usage will cut back.=20 By RICHARD SIMON and DAN MORAIN Times Staff Writers=20 ?????SACRAMENTO--In a visit meant to underscore the Bush administration's= =20 heightened concern about the California electricity crisis Secretary of=20 Energy Spencer Abraham met Thursday with Gov. Gray Davis in Sacramento to= =20 discuss federal energy conservation plans. ?????I think we have an approach that can result in significant savings= =20 Abraham told Davis. The energy secretary said he was in California to gaug= e=20 what we can do to add to what California is already doing. ?????The trip came after President Bush revealed plans for a series of=20 conservation measures for federal buildings and military bases nationwide.= =20 Those facilities in California account for 1.5% of the state's total energy= =20 use. Today Abraham is scheduled to meet with federal officials in San=20 Francisco to work out details of the nationwide program for more than 5000= 00=20 federal buildings. ?????After meeting with Abraham at the White House earlier Thursday Bush= =20 said: We're worried about blackouts that may occur this summer and we wan= t=20 to be a part of any solutions. This administration is deeply concerned abou= t=20 California and its citizens. ?????Defending his response to the California crisis Bush said As I said= =20 from the very beginning of my administration we'll work to help California= =20 in any way we can. ?????Also Thursday Davis met with alternative energy producers in an attem= pt=20 to persuade them to continue operations despite being owed more than $1=20 billion by California's private utilities. ?????Alternative energy producers including oil companies that generate=20 electricity as a byproduct of their operations account for about 27% of th= e=20 electricity consumed in California. Several have stopped producing after th= e=20 utilities could no long afford to pay soaring prices for their power. ?????Davis assigned S. David Freeman and former Assemblyman Richard Katz a= =20 Davis appointee to a state water board to be in charge of negotiations.=20 Davis said he hoped that the talks could be completed within a week. ?????And in a sign that major energy companies may get more involved in the= =20 California crisis Kenneth Lay CEO of the Houston-based energy giant Enron= =20 Corp. met Thursday with Davis Assembly Speaker Bob Hertzberg (D-Sherman= =20 Oaks) and Senate President Pro Tem John Burton (D-San Francisco). ?????Meanwhile Bush on Thursday directed federal agencies to take=20 appropriate actions to conserve energy use at their facilities. ?????In California such measures could include setting thermostats to 78= =20 degrees lowering lighting and turning off escalators during Stage 2 and=20 Stage 3 power emergencies administration officials said. Those occur when= =20 the state's electricity reserves fall below 5% and 1.5% respectively and= =20 can trigger interruptions in service. ?????Bush did not set an energy-saving target. But the Defense Department= =20 one of the state's single largest energy consumers--using about 1% of peak= =20 demand--pledged to reduce peak use by 10% this summer and an additional 5% = by=20 summer 2002. That would make available 200 megawatts officials said enoug= h=20 to provide electricity to about 150000 homes during the summer. ?????The federal government accounts for about 1.5% of total energy use=20 across the country making it one of the nation's largest energy consumers= =20 according to the Energy Department. ?????Bush also offered to make available to the state power-generating unit= s=20 owned by the federal government. ?????But his efforts failed to mollify Democratic critics who renewed call= s=20 for the administration to impose price controls on wholesale electricity. ?????The generating companies are gouging California consumers while the= =20 president turns his back on us Sen. Barbara Boxer (D-Calif.) said in a=20 statement. ?????Rep. Sam Farr (D-Carmel) leader of the California Democratic=20 congressional delegation sent a letter to Vice President Dick Cheney=20 protesting Democrats' exclusion from Cheney's meeting this week with=20 California GOP lawmakers. ?????As we head into the high summer demand months it is unfortunate that= =20 you have decided to keep Democrats in the dark about the administration's= =20 plans to deal with the crisis Farr said. ?????Bush's conservation initiative comes after Cheney who is heading a ta= sk=20 force on national energy policy was assailed by some critics for emphasizi= ng=20 production over conservation. ?????Conservation has got to be an integral part of making sure we've got = a=20 reasonable energy policy Bush said Thursday. But what the vice president= =20 was saying is we can't conserve our way to energy independence nor can we= =20 conserve our way to having enough energy available. We've got to do both. W= e=20 must conserve but we've also got to find new sources of energy. ?????David M. Nemtzow president of the Alliance to Save Energy called the= =20 directive an emergency answer to a long-term problem. ?????We need to fix the underlying problem by investing in energy-efficien= t=20 lighting cooling and controls he said. We hope that this crisis will=20 encourage the president to increase the budget for energy management rather= =20 than cut it by 48% as previously proposed. ?????Political analysts said the effort was driven by concerns for not only= =20 electrons but also elections. ?????It's all about political conservation said Marshall Wittmann senio= r=20 fellow at the conservative Hudson Institute. ?????Thomas E. Mann senior fellow at the nonpartisan Brookings Institution= =20 agreed: The administration has come to the view that just because they can= 't=20 win California in a presidential election doesn't mean the Republican Party= =20 can afford to kiss off the largest state in the Union. ?????Analysts speculated that the administration came under pressure from= =20 California Republicans in Congress who worried about perceptions that the= =20 White House was not being aggressive enough in responding to the crisis. ?????As federal officials search for ways that California can avoid blackou= ts=20 this summer a Woodland Hills-based advocacy group More Power to You has= =20 suggested that the Navy hook its nuclear-powered ships to the state power= =20 grid to provide energy while in port. ?????The Navy has nuclear-powered aircraft carriers and submarines in San= =20 Diego and Washington state. ?????But Navy officials said it is not technologically feasible to use the= =20 nuclear reactors aboard the ships to provide power for the grid because mos= t=20 of that power goes directly to the propulsion systems. ?????Even to capture power not used for propulsion would require extensiv= e=20 construction on shore and retrofitting aboard ship officials said. Also= =20 using ships to provide onshore power could disrupt training and deployment= =20 schedules they said. ---=20 ?????Times staff writer Tony Perry contributed to this report. Copyright 2001 Los Angeles Times=20 PG&E Seeks Relief From High-Priced Power Purchases=20 Bankruptcy: Utility asks judge to order grid operator to stop buying=20 electricity on its behalf at prices beyond its means.=20 By TIM REITERMAN Times Staff Writer=20 ?????SAN FRANCISCO--Pacific Gas & Electric Co. asked a federal bankruptcy= =20 judge Thursday to order the state's power grid operator to stop buying=20 electricity for its customers on the sky-high spot market unless the utili= ty=20 can recover the full cost. ?????The move represents PG&E's latest attempt in Bankruptcy Court to get= =20 relief from actions that the company says are driving it deeper into debt. ?????PG&E asked Judge Dennis Montali to enjoin the California Independent= =20 System Operator from making the company pay the costs of power purchased on= =20 the utility's behalf. The company said it recently received a $1-billion bi= ll=20 for such purchases in January and February. ?????By purchasing wholesale power at a cost higher than the retail rates= =20 and sending us the bill [Cal-ISO] . . . could be reducing the value of our= =20 assets by hundreds of millions of dollars a month said PG&E spokesman Ron= =20 Low. ?????In its motion the company argued that Cal-ISO is violating bankruptcy= =20 law by requiring the utility to pay more for power than it can collect from= =20 state-regulated rates frozen under California's deregulation plan. PG&E sai= d=20 Cal-ISO's actions would force the utility to seek credit on onerous terms. ?????The motion also contended Cal-ISO is violating an April 6 order by the= =20 Federal Energy Regulatory Commission that said the grid operator could only= =20 buy power on behalf of credit-worthy entities. ?????That same day PG&E sought Chapter 11 protection from creditors sayin= g=20 it was $9 billion in debt. It later filed a motion seeking to halt an=20 accounting change ordered by the California Public Utilities Commission=20 which the company says is prolonging the rate freeze and preventing it from= =20 recouping the cost of power. ?????Elena Schmid Cal-ISO's vice president of corporate and strategic=20 development said she has not seen the motion and could not fully comment. ?????But she said Cal-ISO has been discussing billings with PG&E in hopes o= f=20 determining which payments fall within the FERC ruling and which are subjec= t=20 to the bankruptcy case. ?????We will live by the FERC ruling and whatever constraints the Bankrupt= cy=20 Court places on us Schmid said. We have indicated to them (PG&E) that we= =20 are sending the bill . . . and they should treat it as information until w= e=20 can work it through. ?????PG&E listed Cal-ISO as one of its biggest creditors with $1.1 million= =20 owed for power purchased from third parties. Copyright 2001 Los Angeles Times=20 SDG&E Blackout Plan Would Pay Firms to Use Generators=20 Utilities: Program in which large customers produce their own power is=20 forecast to cut demand by as much as 50 megawatts save $1.6 billion.=20 By NANCY RIVERA BROOKS Times Staff Writer=20 ?????San Diego Gas & Electric unveiled a novel plan Thursday to pay custome= rs=20 to fire up their backup generators when blackouts threaten. ?????The utility said the program could cut demand on the power grid by 50= =20 megawatts--enough to serve about 37500 homes--allowing it to avoid or=20 minimize blackouts this summer in San Diego and southern Orange County. ?????California needs an infusion of new power supplies but in the interi= m=20 we hope this unique program will help shield San Diego from some of the=20 devastating effects of rolling blackouts this summer including the increas= ed=20 risks to public safety and health SDG&E President Debra L. Reed said. ?????The Rolling Blackout Reduction Program as the Sempra Energy subsidiar= y=20 has dubbed it would cost $15 million to implement but could save the regio= n=20 as much as $1.6 billion in lost revenue reduced productivity and property= =20 damage the utility has estimated. ?????Energy experts are forecasting a dark summer for California with=20 blackout totals ranging between 20 hours and 1100 hours. The California=20 Independent System Operator which runs the electricity transmission grid f= or=20 most of the state has said residents face 34 days of rotating outages if= =20 they use the same amount of electricity this summer as they did last summer= . ?????The state and utilities have been working feverishly to develop progra= ms=20 that will reduce electricity use this summer. ?????SDG&E Edison International's Southern California Edison and PG&E=20 Corp.'s Pacific Gas & Electric have programs that grant large customers low= er=20 electricity rates in exchange for cutting electricity use when Cal-ISO=20 declares a Stage 2 emergency as power reserves dip below 5%. But=20 participation in those programs has dropped sharply because of repeated pow= er=20 interruptions. ?????SDG&E's interruptible program represents 49 megawatts of demand hal= f=20 of what it was in October spokesman Ed Van Herik said. ?????The new SDG&E program which must be approved by the California Public= =20 Utilities Commission would kick in whenever Cal-ISO declares a Stage 3=20 emergency indicating that power reserves are down to 1.5% of demand and th= at=20 rolling blackouts are imminent. ?????SDG&E hopes to sign up 50 megawatts of backup generation representing= =20 about 40 large commercial and industrial customers but believes customers= =20 capable of generating a total of 200 megawatts may be eligible for the=20 program Van Herik said. ?????We found a lot of customers are interested in this program he said.= =20 This is an opportunity for San Diego to become involved. ?????During a Stage 3 order program participants would be asked to start= =20 their backup generators and then reduce the electricity they receive from= =20 SDG&E by the same amount. ?????Participants would be paid a monthly fee of $7 per kilowatt of=20 generation capacity. On top of that they would receive 35 cents for every= =20 kilowatt-hour of power they generate for their own use. That price is about= =20 what power plant owners have been commanding in California's pricey=20 electricity market. ?????We think the fees we are proposing are fair Van Herik said. These= =20 aren't people who are in the generation business and undoubtedly there wil= l=20 be wear and tear on equipment and increased personnel and fuel costs. ?????The program which SDG&E wants to implement by June 1 would operate i= n=20 compliance with air pollution regulations the utility said. Copyright 2001 Los Angeles Times=20 Been there done that=20 Bay Area finds little new in Bush's ideas=20 Joe Garofoli Bob Egelko Matthew Yi Chronicle Staff Writers Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 Californians who have been sweating for months to cut their home energy usa= ge=20 20 percent didn't blink yesterday at President Bush's suggestion that feder= al=20 offices conserve half that much.=20 Sure some might nod off at their desks this summer when thermostats at=20 federal buildings will be set at 78 degrees during power shortages. And som= e=20 will get an aerobic workout when the escalators at those same buildings ar= e=20 turned off.=20 But civilians and federal employees alike yawned at yesterday's conservatio= n=20 suggestions such as unplug unused coffee pots after doing everything shor= t=20 of burning their shoelaces for wattage during the past few months.=20 Conservation tips are so December to any Californian worth his baseline.=20 I don't think it's frustrating to (us) because most people know what's goi= ng=20 on that we're in an energy crisis said Ansara Johnson 40 revenue offic= er=20 at the Internal Revenue Service in Oakland.=20 The Bush administration may be setting the pace in the moving-stair=20 department however. BART whose escalators don't run so great in the best = of=20 times said yesterday it is looking at operating escalators with an automat= ic=20 stop-start system to save power this summer. The escalators would be dorman= t=20 until passengers activated them.=20 It is kind of ironic considering we just spent $20 million to fix the=20 escalators BART spokesman Ron Rodriguez said.=20 Just don't turn them off during peak hours Ingrid Severson pleaded while= =20 pulling her massage chair onto an escalator at the 12th Street BART station= =20 in downtown Oakland.=20 That would suck said the 23-year-old massage therapist. There are certa= in=20 things that shouldn't be sacrificed.=20 San Francisco International Airport already is turning off escalators durin= g=20 down times though the long long moving sidewalks are going to keep going = no=20 matter what spokesman Ron Wilson said.=20 Those with customers to serve however embraced the Bush energy plan as=20 warmly as a meter-reader.=20 While federal employees will be working up a sweat this summer hiking up=20 stairs to work shoppers at Concord's Sunvalley Mall will be coolly cruisin= g=20 down the moving stairs to Victoria's Secret.=20 We have no plans to shut down our escalators said Sunvalley general=20 manager Tom McCracken. How else would people get from floor to floor?=20 FASHION VICTIMS The new guidelines could have an unintended effect. They may provoke a=20 fashion revolution among federal employees not a group traditionally known= =20 for its couture choices.=20 It's not their fault. There's only so much you can do with postal blue or= =20 judicial black. But with Bush's directive that thermostats be set at 78=20 degrees many employees said something has to change. Like their wardrobes= .=20 Start with the long-suffering post office sales associates -- the clerks=20 behind the counter -- whom government regulations have shackled in long woo= l-=20 blend pants.=20 I still have not heard a clear-cut reason why we're not allowed to wear=20 shorts and the mail carriers are said Steve Wellington a postal sales=20 associate in Concord. The former postal union leader said the=20 shorts-vs.-pants debate has been a hot one for a long time.=20 Look at these pants Wellington said offering a visitor a touch of his= =20 trousers. These get real warm in the summer.=20 While postal officials were happy to point out that their San Francisco=20 offices have used 17 percent less electricity than last year they wouldn't= =20 touch the shorts issue. I don't think we need to comment on that said=20 Horace Hinshaw a spokesman for the U.S. Postal Service.=20 JUDGES GET EXEMPTION Then there are judges. Attorneys and court employees said the bench needs t= o=20 take the lead in the casual attire revolution. Ditch those heavy black robe= s=20 in favor of say a black polo shirt.=20 Black really magnifies the heat said Napa attorney Paul Carey. They=20 should allow judges to wear lighter colors like yellow or chartreuse. If t= he=20 judges would allow it every attorney I know would love to wear a T-shirt= =20 shorts and sandals into court.=20 However there was one indication that judges may be thermostat-exempt at= =20 least at the Phillip Burton Federal Building a 20-story tower at 450 Golde= n=20 Gate Ave. in San Francisco that houses federal courts and numerous agencies= .=20 A contractor who was working yesterday to install new thermostat controls i= n=20 the building said two areas were excluded: computer rooms to protect the= =20 equipment and courtrooms.=20 That was the mandate said Erik Ahrens vice president of Syserco which= =20 has a contract for heating and vent control. Courtrooms are on separate=20 units. =20 At the Ronald V. Dellums Federal Building in downtown Oakland lights alrea= dy=20 have been dimmed in hallways and workers have been encouraged to turn off= =20 unneeded lights and computers since early this year. Cynthia Mackey 38 a= =20 revenue officer for the Internal Revenue Service wasn't happy to hear the= =20 thermostat would be going up.=20 Oh no. I guess I'll just work at home where Mackey said the thermostat = is=20 set at 68 degrees. If it's set at 78 and with all the employees and all t= he=20 computers it would be hot.=20 Then it will be time to change -- habits and clothes.=20 E-mail the reporters at jgarofoli@sfchronicle.com begelko@sfchronicle.com = or=20 myi@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 Bush calls power supply the solution=20 He says conservation useful but secondary=20 Marc Sandalow Washington Bureau Chief Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 Even as he ordered a new conservation effort in California President Bush= =20 insisted yesterday that finding new sources of energy -- not cutting back o= n=20 consumption -- is the long-term answer to the nation's energy woes.=20 You cannot conserve your way to energy independence Bush said. We can d= o=20 a better job in conservation but we darn sure have to do a better job of= =20 finding more supply.=20 Bush's comments his most extensive to date on California's energy crisis= =20 called on all federal managers to conserve energy to the maximum extent=20 consistent with the effective discharge of public responsibilities.=20 As part of that effort the Defense Department -- one of California's large= st=20 consumers of energy -- announced plans to curtail electrical use by at leas= t=20 10 percent by this summer.=20 This administration is deeply concerned about California and its citizens= =20 Bush said after a meeting with his top energy advisers. We're worried abou= t=20 blackouts that may occur this summer and we want to be a part of any=20 solution. =20 While touting the value of conservation Bush repeatedly identified the=20 limits to that approach. In response to questions from reporters Bush made= =20 clear that he would not be confused with former President Jimmy Carter who= =20 donned a cardigan sweater and preached the virtues of conservation two=20 decades ago.=20 It is naive for the American people and its leaders . . . to say that we c= an=20 be OK from an energy perspective by only focusing on conservation Bush=20 said. We've got to find additional supplies of energy.=20 Bush has called for oil drilling in Alaska as well as exploratory drilling= =20 in other parts of the West. Members of his administration also have touted= =20 the expanded use of coal and have floated the idea of building new nuclear= =20 power plants.=20 SUPPLY-SIDE PLAN There have been repeated signals that the comprehensive energy plan being= =20 developed by a White House task force -- which is expected to be released i= n=20 two weeks -- will focus less on conservation than on boosting energy=20 supplies.=20 Energy Secretary Spencer Abraham speaking to reporters after meeting with= =20 the president said conservation plays an important role in helping=20 California through its immediate crisis. Yet developing new sources of ener= gy=20 is important to prevent the rest of the nation from experiencing California= 's=20 shortages.=20 We have a crisis and an emergency this summer (in California) that will=20 result in 30 to 35 days of blackouts Abraham said from the White House=20 driveway. We don't have the time between now and those occasions to develo= p=20 new (energy) sources sufficient to meet the challenge.=20 By the middle of the month the White House will release a national energy= =20 plan that will be more comprehensive and more far reaching that will offer= a=20 new vision that addresses Americans long-term supply security Abraham sai= d.=20 MEETING WITH DAVIS The energy secretary traveled to Sacramento last night where he planned to= =20 meet with Gov. Gray Davis and other state officials. He is scheduled to hol= d=20 a public conservation event this morning in San Francisco and to discuss wi= th=20 federal officials how they can reduce energy consumption.=20 An action plan distributed by the Department of Energy calls for federal=20 workers across the country to develop conservation plans within the next 30= =20 days.=20 In addition it calls for specific actions during Stage 2 or Stage 3 power= =20 emergencies when supplies are within 5 percent of demand. Some experts war= n=20 that California will be in such a state for much of the summer.=20 Among the steps called for in an energy emergency are setting thermostats i= n=20 federal buildings no lower than 78 degrees turning off escalators and=20 hallway lights and unplugging coffee pots computers and any nonessential= =20 appliances.=20 The plan suggests that employees be notified when temperatures might be war= m=20 so they can wear more casual clothing to make the heat more bearable.=20 Meanwhile the Pentagon announced it will reduce its consumption during pea= k=20 demand hours by 10 percent and perhaps by as much as 15 percent by next=20 summer. It will also hook up wind generation facilities at Edwards Air Forc= e=20 Base.=20 Paul Wolfowitz deputy secretary of defense said the steps will save the= =20 state's power grid about 200 megawatts of power enough electricity for 200= =20 000 homes.=20 Energy officials have explored many options including the use of nuclear= =20 submarines to provide energy during shortages and firing up the generators = on=20 the Navy's mothball fleet in Suisun Bay near Benicia. Both ideas have been= =20 rejected as unfeasible energy officials said.=20 Democrats cheered Bush's call for conservation though several said it did= =20 not go far enough.=20 IRONIC PRAISE I am very happy the president and Secretary Abraham recognized that=20 conservation matters said Richard Sklar Gov. Davis' top energy adviser.= =20 We thank the president for catching up with the train.=20 Republican governors meeting in San Jose suggested that Davis could do more= =20 on his own and in concert with other Western states to help California ease= =20 its energy crunch.=20 It's time Montana Gov. Judy Martz argued that California met its=20 responsibility to build an adequate power supply and stop looking to=20 Washington for a bailout.=20 Others however called on Bush to go further and impose price caps on=20 wholesale electricity prices to guarantee a steady flow of electricity and= =20 keep prices down for consumers.=20 Chronicle staff writers Lynda Gledhill and Bill Workman contributed to this= =20 report. / E-mail Marc Sandalow at msandalow@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 SDG&E unveils plan to contend with rolling blackouts=20 Friday May 4 2001=20 2001 Associated Press=20 URL:=20 tate0 957EDT0155.DTL&type=3Dnews=20 (05-04) 06:57 PDT SAN DIEGO (AP) -- San Diego Gas & Electric has unveiled a= =20 plan that would pay customers who fire up their emergency generators when= =20 rolling blackouts loom.=20 The utility is seeking approval from the state Public Utilities Commission = to=20 place about 40 companies under contract to generate a total of 50 megawatts= =20 during statewide power alerts. The backup power would be enough to serve=20 about 37500 homes.=20 ``These businesses would actually be sharing their backup generation with t= he=20 San Diego region'' Debra Reed president of SDG&E said Thursday.=20 The Rolling Blackout Reduction Program would cost the utility an estimated= =20 $15 million to implement but could save the regions as much as $1.6 billio= n=20 in lost revenue property damage and reduced productivity caused by=20 blackouts utility officials said.=20 The California Independent System Operator which manages the transmission= =20 grid for most of the state has estimated that residents face up to 200 hou= rs=20 of blackouts over 30 to 35 days this summer due to high demand and=20 insufficient energy supplies.=20 The use of emergency generators will lead to more air pollution but Reed= =20 said the ``social benefit'' of the trade-off would be worth it because=20 residents and businesses would not have to deal with the safety risks and= =20 hazards of blackouts.=20 SDG&E officials want the Public Utilities Commission to act on its request= =20 within a week and hope to have the program in effect by June 1.=20 The program would go into effect whenever Cal-ISO declares a Stage 3=20 emergency which indicates that power reserves are down to 1.5 percent and= =20 rolling blackouts are imminent. Program participants would be asked to star= t=20 their emergency generators and then reduce the electricity they receive fro= m=20 SDG&E by the same amount.=20 Participants would be paid a monthly fee of $7 per kilowatt of generation= =20 capacity plus receive an additional 35 cents for every kilowatt-hour of=20 power generated for their own use.=20 ``We think the fees we are proposing are fair'' said SDG&E spokesman Ed Va= n=20 Herik. ``These aren't people who are in the generation business and=20 undoubtedly there will be wear and tear on equipment and increased personne= l=20 and fuel costs.''=20 2001 Associated Press ?=20 California crisis brings new talk of energy conservation.=20 DEB RIECHMANN Associated Press Writer Friday May 4 2001=20 2001 Associated Press=20 URL:=20 tate0 945EDT0153.DTL&type=3Dnews=20 (05-04) 06:45 PDT WASHINGTON (AP) -- In the 1970s energy conservation was= =20 Jimmy Carter in a cardigan telling people to bundle up and turn down the=20 heat. Today it's about using energy-efficient fluorescent bulbs=20 computerized thermostats and motion sensors.=20 To many Americans California's energy crisis is a problem isolated on the= =20 West Coast. Yet it has resurrected interest in conservation that hasn't bee= n=20 heard since gas lines and the OPEC oil embargo more than two decades ago.= =20 President Bush on Thursday ordered federal agencies to cut power use in=20 California where rolling blackouts have catapulted the debate over future= =20 energy supplies to the top of the national agenda.=20 Bush's conservation message came just days after Vice President Dick Cheney= =20 who claims the whole nation could face blackouts like those in California= =20 unless it finds more oil natural gas and coal said America cannot ``simpl= y=20 conserve or ration our way out of the situation we're in.''=20 Environmentalists maintain the Bush administration is using California's=20 electricity crisis -- largely due to a failed attempt at electricity=20 deregulation -- to push through a broader energy plan to drill for oil and= =20 natural gas in now off-limits areas of Alaska and the West. Hardly any powe= r=20 plants run on oil they note.=20 And energy-conservation groups say if everybody made better use of the ener= gy=20 already being generated America would not need many of the 1300-plus powe= r=20 plants that Bush and Cheney say demand will require over the next 20 years.= =20 Nobody will have to sit in the dark they say if it were made easier for= =20 Americans to use less energy through more fuel efficient light bulbs motor= s=20 automobiles office buildings and homes.=20 ``In today's world we are not asking people to not use their (air=20 conditioning) -- that is not today's message of conservation'' said Rozann= e=20 Weissman a spokeswoman for the Alliance to Save Energy a Washington-based= =20 nonprofit group. ``What we need to do is look at using our energy more=20 efficiently and using today's technologies to help do it for us.''=20 According to the alliance:=20 --If each household in the United States replaced four regular 100-watt bul= bs=20 with energy-efficient compact fluorescent bulbs the output of 30=20 medium-sized power plants (each with a 300-megawatt capacity) would not be= =20 needed.=20 --If the Bush administration's new efficiency standards for air conditioner= s=20 and heat pumps improved energy use by 30 percent instead of 20 percent the= =20 output of 138 of these power plants would not been needed during peak use= =20 times.=20 Americans could even unplug idle appliances -- TVs VCRs cable boxes CD= =20 players and microwaves -- when they go out of town. Some of these appliance= s=20 continue to consume energy when switched off. The power keeps display clock= s=20 lighted and memory chips and remote controls working. The alliance says the= se=20 electric leaks cost consumers more than $3 billion a year.=20 Conservation does help according to Alexandra von Meier director of the= =20 Environmental Technology Center at Sonoma State University in California. S= he=20 told a House energy subcommittee on Thursday that residential and commercia= l=20 buildings use about 35 percent of the energy -- electricity and fuels -- in= =20 the United States.=20 ``This amount of energy can be cut in half if not more by implementing th= e=20 things we already know about how to make buildings more energy efficient an= d=20 at the same time more comfortable'' she said explaining how Venetian=20 blinds hung on the outside of the technology center keeps the glass from=20 transferring heat.=20 Howard Geller former executive director of the American Council for an=20 Energy Efficient Economy told the committee about an Energy Department stu= dy=20 in November 2000 that said increasing energy efficiency throughout the=20 economy could cut national energy use by at least 10 percent by 2010 and by= =20 20 percent in 2020.=20 ``Even though the United States is much more energy-efficient today than it= =20 was 25 years ago there is still enormous potential for additional=20 cost-effective energy savings'' said Geller.=20 Associated Press reporter H. Josef Hebert contributed to this report.=20 2001 Associated Press ?=20 Developments in California's energy crisis=20 The Associated Press Friday May 4 2001=20 2001 Associated Press=20 URL:=20 tate0 410EDT0127.DTL&type=3Dnews=20 -- (05-04) 01:10 PDT Developments in California's energy crisis:=20 FRIDAY:< ?--No power stage alerts are reported as of early Friday morning. = ?THURSDAY:<=20 -- Gov. Gray Davis meets with representatives of the qualifying facilities = in=20 Sacramento to discuss their concerns and the possibility of getting their= =20 plants online during all peak periods.=20 -- The state Senate sends a bill to the governor that would create a state= =20 public power authority. Supporters say the bill will ease the energy crisis= =20 by allowing the state to build and buy power plants that could provide=20 cheaper wholesale electricity.=20 -- State Treasurer Phil Angelides says Assembly Republicans are ``holding= =20 their own state hostage'' by not approving a bill to authorize up to $12.5= =20 billion in bonds for power purchases. Republicans put their own plan forwar= d=20 Wednesday saying they'd rather use $5 billion of the state's surplus and= =20 finance less.=20 -- Energy Secretary Spencer Abraham travels to the Capitol to discuss the= =20 state's power woes with Davis. Abraham meets with state Republican leaders = in=20 San Francisco following the meeting with the governor.=20 -- The new special counsel to the Senate Select Committee to Investigate=20 Price Manipulation of the Wholesale Energy Market says ``it is likely there= =20 was some criminal activity'' in driving up electricity prices. Laurence=20 Drivon a private plaintiff's attorney from Stockton will work for the=20 committee for free spending about four days a week on the job initially. H= is=20 review of thousands of power-related documents leads him to believe there w= as=20 criminal collusion he would not elaborate.=20 -- The San Joaquin County District Attorney is joining the Senate Select=20 Committee in its power investigation. Supervising Deputy District Attorney= =20 Franklin Stephenson says three experienced investigators will help the=20 committee decide if there was illegal price-fixing antitrust violations o= r=20 theft of public funds by public or private electric generators.=20 -- Pacific Gas and Electric Co. asks a federal bankruptcy judge to stop the= =20 state's power grid manager from charging the utility for expensive=20 last-minute electricity. PG&E has applied for bankruptcy protection and say= s=20 that the ISO's bills ``could be reducing the value of the company's assets = by=20 potentially hundreds of millions of dollars per month.''=20 -- Secretary of State Bill Jones a Republican candidate for governor=20 proposes a utility rescue plan that would take the state out of the=20 electricity business. The plan calls for utility creditors to accept=20 less-than-full payments more cash flow from the utilities' parent companie= s=20 and low-interest state loans to help the utilities pay off their debts.=20 -- The California Association of Health Care Facilities says it expects the= =20 state Public Utilities Commission to exempt nursing homes from blackouts. T= he=20 group says many nursing home residents depend on electric life support=20 machines. A PUC decision is expected by May 14.=20 -- The California Immigrant Welfare Collaborative said they are worried tha= t=20 state's power purchases could threaten two assistance programs that pay for= =20 food stamps and cash benefits. The programs which help recent immigrants= =20 expire Sept. 30 unless they get renewed during budget negotiations.=20 -- The state auditor will look into the California Energy Commission's=20 process for siting new power plants and allowing defunct plants to return t= o=20 service. The audit was requested by Assemblyman Jay La Suer R-La Mesa and= =20 is expected in August.=20 -- Edison International stock closes at $9.28 down 9 cents. PG&E Corp.=20 dropped 10 cents to close at $8.86.=20 -- The state remains free of power alerts as electricity reserves stay abov= e=20 7 percent.=20 WHAT'S NEXT:< -- The governor meets Wednesday with the CEOs of several major energy=20 suppliers to discuss the money their owed by the state's two largest=20 utilities the state's creditworthiness and how wholesalers can help the=20 state during the energy crisis. Davis says he won't be discussing any of th= e=20 investigations into price manipulation in the wholesale market.=20 -- Davis' representatives continue negotiating with Sempra the parent=20 company of San Diego Gas and Electric Co. to buy the utility's transmissio= n=20 lines.=20 THE PROBLEM:< High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Edison and PG&E say they've lost nearly $14 billion since June to high=20 wholesale prices the state's electricity deregulation law bars them from=20 passing on to consumers. PG&E saying it hasn't received the help it needs= =20 from regulators or state lawmakers filed for federal bankruptcy protection= =20 April 6.=20 Electricity and natural gas suppliers scared off by the two companies' poo= r=20 credit ratings are refusing to sell to them leading the state in January = to=20 start buying power for the utilities' nearly 9 million residential and=20 business customers. The state is also buying power for a third investor-own= ed=20 utility San Diego Gas & Electric which is in better financial shape than= =20 much larger Edison and PG&E but also struggling with high wholesale power= =20 costs.=20 The Public Utilities Commission has raised rates as much as 46 percent to= =20 help finance the state's multibillion-dollar power buys.=20 2001 Associated Press ?=20 Energy at a glance=20 Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N225908.DTL&type=3Dnews=20 In other energy-related developments yesterday:=20 STATE POWER AUTHORITY On a partisan vote the Legislature sent Gov. Davis a bill creating a state= =20 public power authority that can sell as much as $5 billion in bonds to buil= d=20 or buy power plants beef up conservation and renewable energy programs and= =20 retrofit older plants to make them less polluting. Davis is expected to sig= n=20 the bill by state Senate President Pro Tem John Burton D-San Francisco ne= xt=20 week.=20 STATE SENATE INVESTIGATION A special Senate committee investigating allegations of antitrust violation= s=20 and price-fixing by electricity generators announced that Larry Drivon a= =20 Stockton trial lawyer would serve as the committee's general counsel. Driv= on=20 said that from documents he has seen there is some indication there very= =20 well may have been criminal aspects to this.=20 PG&E COMPLAINTS PG&E usually the target of complaints about electricity bills made its ow= n=20 gripe about high bills to a federal bankruptcy judge yesterday. PG&E said t= he=20 California Independent System Operator which manages the state's power gri= d=20 charged the utility nearly $1 billion for power that the ISO bought above= =20 retail prices in January and February and reduced the assets available in= =20 bankruptcy. The company asked the judge to tell the ISO to back off. ISO=20 spokeswoman Lorie O'Donnelly said her agency has stopped buying power for= =20 PG&E -- a task now handled by the state -- and will await the outcome of th= e=20 bankruptcy proceedings to see how much of its bill it can collect.=20 ALTERNATIVE ENERGY Gov. Davis met with producers of alternative energy such as solar panels a= nd=20 wind farms a third of whom have shuttered their operations because the=20 utilities they have contracts with have paid them pennies on the dollar sin= ce=20 November. The generators going offline have contributed to recent rolling= =20 blackouts. Davis said the meeting's purpose was to resolve any remaining=20 disputes between the energy producers and the utilities so more electricity= =20 can be produced this summer. The participants said they made progress and= =20 agreed to meet again next week.=20 2001 San Francisco Chronicle ? Page?A - 17=20 Ships would help during blackouts=20 Ready reserve fleet has power to provide=20 Carl Nolte Chronicle Staff Writer Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N182291.DTL&type=3Dnews=20 San Francisco -- A fleet of 13 gray government cargo ships tied up on the S= an=20 Francisco waterfront and at Alameda is ready and able to provide emergency= =20 electric power if rolling blackouts hit this summer.=20 We'd be more than willing to help said Capt. Frank Johnston Western=20 region administrator for the U.S. Maritime Administration which manages th= e=20 ships. The vessels are part of the country's ready reserve fleet have crew= s=20 aboard 24 hours a day and are prepared to sail anywhere in the world on fiv= e=20 days' notice.=20 The offer comes a day after the Bush administration suggested using ships i= n=20 the so-called mothball fleet in Suisun Bay near Benicia to provide power.= =20 However the officer in charge of the old ships there said yesterday he=20 thought his vessels could not make much of a contribution.=20 Nobody has contacted us about that said Joseph Pecoraro superintendent = of=20 the reserve fleet.=20 Unlike the ready reserve ships the mothball vessels are neither modern nor= =20 set to sail anytime soon.=20 Pecoraro said the equipment on most of the ships has not been used in years= .=20 To use them to supply civilian power he said is not real simple.=20 It's feasible he said but probably not practical.=20 On the other hand using the ready reserve ships also has some drawbacks --= =20 crewing the ships paying for fuel and more seriously the amount of=20 pollution produced by running the ship's diesel generators.=20 Johnston said the ships meet Environmental Protection Agency standards but= =20 some environmental activists have grave misgivings. Nothing could be a=20 bigger disaster for air quality said Russell Long executive director of= =20 the Bluewater Network in San Francisco which has been highly critical of a= ir=20 pollution caused by marine engines. These are very highly polluting engine= s.=20 They produce a hundred times more pollution per kilowatt hour than modern= =20 generators he said.=20 Long says EPA standards for ships are pathetic.=20 Ships are the worst polluters on the planet.=20 Several of the ready reserve ships are in highly visible berths in San=20 Francisco. One of them the cargo ship Cape Henry is at Pier 27 at the foo= t=20 of Telegraph Hill and another the Cape Orlando is at Pier 50 on the=20 southern waterfront not far from Pacific Bell Park. The ship is visible fr= om=20 the stands and is a kind of floating backdrop to the right-field wall.=20 Nine of the ships are tied up at the former Alameda Naval Air Station but= =20 any or all of them could be easily moved.=20 The ships have civilian crews but are often confused with Navy ships becau= se=20 they are painted battleship gray. They are intended for use in time of=20 international crisis or other incident.=20 All of them have the capacity to generate electricity. Johnston said he was= =20 not sure exactly how much power his ships could supply but it would be=20 enough for emergency services.=20 We could supply fire stations or police stations or hospitals or the 91= 1=20 network he said. There are all kinds of possibilities and we are more th= an=20 willing to consider any proposal Johnston said.=20 It is better to plan now than to wait until the power goes out and then wo= rk=20 by flashlight he said.=20 Johnston said he did not have the authority to conclude an agreement with= =20 local officials himself but he would be glad to run a plan up the flagpol= e=20 in Washington.=20 Power from ships has been used in the past in emergency situations. Many=20 years ago said Capt. Patrick Moloney executive director of the California= =20 Pilot Commission power from the aircraft carrier Saratoga was used to supp= ly=20 the city of Tacoma Wa. during an emergency.=20 However he said because of the complexity of connecting ship's power with= =20 the civilian grid such applications are rare. It is a nice idea he said= =20 but ships are not configured for it.=20 E-mail Carl Nolte at cnolte@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 19=20 PG&E chairman wants to keep power lines=20 David Lazarus Chronicle Staff Writer Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/B U162707.DTL&type=3Dnews=20 Pacific Gas and Electric Co. may be more amenable to selling off its dams= =20 rather than its power lines if required to part with assets as part of the= =20 utility's bankruptcy proceedings PG&E Chairman Robert Glynn said yesterday= .=20 In a meeting with Chronicle editors and writers Glynn stressed that he sti= ll=20 hopes to get through the bankruptcy process without selling any of PG&E's= =20 resources to pay off creditors.=20 But if there is an asset to be sold it's not clear that the power lines i= s=20 it he said. Our hydro assets actually have a higher value.=20 Glynn's comments may signal challenges down the road for Gov. Gray Davis'= =20 efforts to acquire the transmission systems of all three of California's=20 investor-owned utilities.=20 Southern California Edison already has agreed to sell its lines to the stat= e=20 for $2.7 billion. A similar accord is expected to be reached with San Diego= =20 Gas & Electric.=20 However critics have said Davis would be purchasing a white elephant if he= =20 manages to buy only about a third of the statewide electricity grid. Withou= t=20 PG&E's lines the Edison and San Diego systems would be of lesser value.=20 Glynn noted that he had tentatively agreed to sell off PG&E's power lines f= or=20 an undisclosed sum before the utility's negotiations with the state collaps= ed=20 in March.=20 But I've said pretty clearly that I don't want to sell off any part of our= =20 business he said.=20 Glynn defended his decision to file for bankruptcy by saying it was the mos= t=20 efficient way to restore cash-strapped PG&E to credit-worthiness. The utili= ty=20 has racked up about $9 billion in debt because of runaway wholesale power= =20 prices.=20 The company's got to be able to pay its bills Glynn said. We expect to= =20 pay all of our valid debts.=20 He said PG&E will submit a proposed reorganization plan to the bankruptcy= =20 court in San Francisco by early August. That plan may include aspects of th= e=20 bailout accord reached between Davis and Edison.=20 If an element of it makes sense for us we would be comfortable including= =20 it Glynn said.=20 He said it appears likely that an average 40 percent rate increase already= =20 approved by state regulators will cover current energy purchases and that n= o=20 further rate hikes may be required.=20 Under this plan the current average monthly PG&E electricity bill of $60= =20 will rise by about $18.=20 However Glynn said the need for higher power bills will not be clear until= =20 the Public Utilities Commission decides how it will divide existing rates= =20 between PG&E and the state Department of Water Resources which is spending= =20 about $50 million a day to keep California's lights on.=20 If the state wants to take all the money then a solution does not exist= =20 he said.=20 Glynn said that despite recent progress in getting Californians to conserve= =20 energy he believes the only way the state will solve its long-term power= =20 woes will be to build more generating facilities.=20 It is my personal belief that it's not possible to conserve our way back t= o=20 a stable supply-and-demand balance he said. We've got to get back to the= =20 point where we have enough supply to meet demand every day of the year.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?B - 1=20 Bush shifts policy on conservation after meeting with GOP=20 Posted at 10:06 p.m. PDT Thursday May 3 2001=20 BY JIM PUZZANGHERA=20 Mercury News Washington Bureau=20 WASHINGTON -- On Monday Vice President Dick Cheney used a major speech to= =20 largely dismiss energy conservation as an outdated notion from the 1970s. O= n=20 Thursday President George W. Bush announced a major initiative to force=20 federal facilities in California and nationwide to conserve energy to try t= o=20 avoid blackouts.=20 What happened in those three days?=20 The impetus for the shift appears to have been a one-hour meeting Tuesday= =20 between Cheney and 18 Republican members of Congress from California on=20 Capitol Hill.=20 An energy conservation plan for federal agencies was brought up by=20 congressional Republicans according to two participants. And the political= =20 ramifications on the party of appearing to do nothing to ease the crisis we= re=20 discussed . No Democrats were invited even though they outnumber Republica= ns=20 in the state's congressional delegation 32 to 20 and the meeting was suppos= ed=20 to look at federal help for the California crisis.=20 Some California Republicans have been griping that the White House has not= =20 been showing enough concern for the state as it continues to struggle throu= gh=20 its energy crisis. Bush who lost California by 1.3 million votes in=20 November and top members of his administration have consistently stressed= =20 that the crisis is largely California's to solve.=20 ``I think there was a need for the administration to begin to weigh in on= =20 this thing especially because there's been so much finger-pointing. Democra= ts=20 have been trying to divert the real blame away from'' Gov. Gray Davis said= =20 Rep. George Radanovich R-Fresno who attended the meeting. ``I mentioned t= o=20 the vice president that politically speaking we don't want that to happen. = We=20 want the blame to rest where it deserves to rest with the governor. And th= ey=20 need to be concerned about that for politics in California.''=20 Damage control=20 Democrats like Rep. Sam Farr D-Salinas said Thursday it's obvious the=20 White House got the message and the conservation plan is an attempt at dama= ge=20 control.=20 The president is ``worried the blackouts may be known as the `Bush Blackout= s'=20 and he wants them to be known as the `Davis Blackouts'? '' said Farr head= =20 of the state's Democratic congressional delegation. He wrote to Cheney on= =20 Thursday expressing ``extreme disappointment'' that the vice president had= =20 excluded Democrats from the Tuesday meeting. Despite several requests Farr= =20 and his Democratic colleagues have yet to meet with Cheney or any other top= =20 administration officials on the issue.=20 Bush on Thursday denied there was any change in policy.=20 ``What the vice president and I understand is that you cannot conserve your= =20 way to energy independence'' Bush said Thursday after meeting with Energy= =20 Secretary Spencer Abraham and Deputy Defense Secretary Paul Wolfowitz. ``We= =20 can do a better job in conservation but we darn sure have to do a better j= ob=20 of finding more supply.''=20 A task force headed by Cheney is finalizing a national energy plan that is= =20 expected to put is major emphasis on increasing supply through more drillin= g=20 for oil and natural gas and greater use of coal and nuclear power.=20 Bush emphasized that ``this administration is deeply concerned about=20 California and its citizens'' as he instructed federal agencies to reduce= =20 their energy usage during Stage 2 or 3 power emergencies in California. The= =20 directive will extend to other states that find themselves facing blackouts= =20 this summer such as those in the Pacific Northwest and the Northeast.=20 Steps to conserve=20 Among the measures administration officials said will be turning up=20 thermostats to 78 degrees darkening interior hallways and pre-cooling=20 buildings at night. Wolfowitz said the Defense Department expected to reduc= e=20 its usage in California by 10 percent over last year and plans to hook up a= n=20 idle wind-powered generating facility at Edwards Air Force Base. All told= =20 the Defense Department hopes to make about 200 megawatts of power available= =20 to the state this summer through reduced usage and added generation.=20 The presidential directive follows one issued by former President Clinton= =20 late last year to federal facilities in California and the Pacific Northwes= t=20 to conserve energy. The Bush administration said its move was more extensiv= e=20 because it directs all facilities nationwide to conserve and requires=20 agencies to report back their actions within 30 days.=20 Rep. Dana Rohrabacher R-Huntington Beach said he and others at Tuesday's= =20 meeting urged that Bush travel to California. Bush has yet to visit the sta= te=20 despite traveling extensively through the country during his first three=20 months.=20 ``We suggested the president come out the vice president come out and any= =20 members of the administration come out so that the people know we're=20 engaged'' Rohrabacher said.=20 California clearly was the main impetus for the Bush directive and the=20 president dispatched Abraham to California on Thursday to discuss the plan= =20 with Davis and the regional heads of federal agencies. Dan Schnur a=20 Republican consultant said that was a good move for the White House.=20 ``Substantively the Bush administration has been doing the right things b= ut=20 because they haven't been out here making their case in person it makes it= =20 much tougher for their case to be heard.'' Schnur said. ``After the=20 Northridge earthquake Clinton had half his Cabinet out here. None of them= =20 had anything official to do but you couldn't turn around without seeing on= e=20 of them on local television talking about Clinton's commitment to rebuildin= g=20 after the earthquake.''=20 Abraham said the White House has responded to nearly every request the stat= e=20 made regarding the electricity crisis. But the administration has not=20 delivered the regionwide caps on electricity prices officials from Californ= ia=20 and the Pacific Northwest have pressed for.=20 The administration even looked into bringing nuclear submarines or aircraft= =20 carriers to the California coast and hooking up their generators to the=20 state's electricity grid. The idea was scrapped after federal officials=20 realized only a small amount of power could be supplied and that safety=20 issues could not be overcome Abraham said.=20 Contact Jim Puzzanghera at (202) 383-6043 or at jpuzzanghera@krwashington.c= om Senate plans public power=20 Published Friday May 4 2001 in the San Jose Mercury News=20 BY AUDREY COOPER=20 Associated Press=20 SACRAMENTO -- California is poised to enter the power business after the=20 state Senate on Thursday approved creation of a public power authority and= =20 sent its bill to Gov. Gray Davis.=20 A power authority supporters said will give the state more control over i= ts=20 wholesale electricity market by building and operating its own power plants= .=20 State-owned plants could charge lower prices and building new plants could= =20 increase supply and ease wholesale prices.=20 If signed by Davis the bill would create a California Consumer Power and= =20 Conservation Financing Authority that could issue up to $5 billion in reven= ue=20 bonds to pay for power plants natural gas storage and additional pipelines= =20 and conservation programs.=20 Also Thursday state Treasurer Phil Angelides blasted a Republican plan to= =20 use $5 billion of the state's surplus toward buying power rather than=20 financing the entire amount with $12.5 billion in bonds.=20 Lawmakers ``are playing a dangerous game of financial roulette putting in= =20 jeopardy the state's fiscal integrity and solvency'' Angelides said.=20 Angelides has been pushing the Legislature to pass a bill that spells out a= =20 limit on the bonds by May 8. The bonds must be approved by then so the stat= e=20 can get a bridge loan to replenish the state's general fund until the bonds= =20 are sold.=20 In a letter to Assembly Speaker Robert Hertzberg late Wednesday the=20 Republicans laid out an alternative plan. The bonds are to repay the state= =20 for $5 billion in power purchased since January for customers of Pacific Ga= s=20 & Electric Co. Southern California Edison and San Diego Gas & Electric. Th= e=20 remainder of the bond issue would pay for future power for those customers.= =20 Assembly Republican Leader Dave Cox Sacramento said taxpayers have the=20 surplus funds and should use that to get out of the crisis rather than=20 financing the total bill.=20 ``There's no need for the bridge loan'' Cox said. ``This is about fiscal= =20 responsibility not borrowing money you don't have to borrow. The state of= =20 California needs to tighten its belt just like California ratepayers and= =20 taxpayers had to.''=20 Davis has not decided whether to sign the power authority bill the spokesm= an=20 said. But Davis has said he supports creating an authority similar to one i= n=20 New York. The New York authority has 10 power plants and 1400 miles of=20 transmission lines and produces about 25 percent of the state's power.=20 The 24-14 vote on the bill was split down party lines. ALL CAPS HED=20 Published Friday May 4 2001 in the San Jose Mercury News=20 Developments Thursday in California's energy crisis:=20 The state Senate sends a bill to the governor that would create a state=20 public power authority to build and buy power plants.=20 Secretary of State Bill Jones a Republican candidate for governor propose= s=20 a utility rescue plan that would take the state out of the electricity=20 business.=20 State Treasurer Phil Angelides says Assembly Republicans are ``holding thei= r=20 own state hostage'' by not approving a bond-authorization bill for power=20 purchases.=20 Energy Secretary Spencer Abraham meets in the Capitol with Gov. Gray Davis. Source:?Associated Press=20 Energy notebook=20 Vote delayed on $12 billion state bond for power.=20 May 4 2001=20 SACRAMENTO - California lawmakers delayed voting on a $12 billion bond sale= =20 for power purchases after Republicans proposed to reduce the size of the sa= le=20 and use part of the state's surplus to cut electric rates.=20 Assembly Republican leader Dave Cox of Sacramento proposed reducing the bon= d=20 sale to $8 billion and using $5 billion of California's budget surplus to c= ut=20 rates for consumers.=20 California began buying power for its cash-strapped utilities this year and= =20 has spent $5.6 billion so far. The state expects to spend about $15.1 billi= on=20 on power this year according to a report released this week by Gov. Gray= =20 Davis.=20 Lawyer hired to probe possible price-gouging=20 SACRAMENTO - A lawyer who won big verdicts against Ford Motor Co. and the= =20 Roman Catholic Church was appointed Wednesday to lead a state Senate=20 investigation into possible price-gouging and antitrust violations by=20 electricity producers.=20 Laurence Drivon a Stockton lawyer has taken a temporary leave from his=20 practice and will work in the office of Sen. Joe Dunn D-Santa Ana.=20 Dunn chairs the committee that is looking into why California's energy pric= es=20 have skyrocketed what legislative action must be taken to remedy the=20 problem and whether there is any proof of criminal misconduct on the part = of=20 the power producers.=20 Drivon is credited as co-counsel for $295 million verdict in a 1999 case=20 against Ford for a rollover accident that killed three passengers in a 1978= =20 Bronco. Drivon also won a $30 million verdict against the Roman Catholic=20 Diocese of Stockton in 1998 after he showed the church knew a parish priest= =20 had molested two children but failed to intervene.=20 Dunn also announced the formation of a statewide coalition of district=20 attorneys to look into the allegations.=20 PG&E wants ISO to cease trying to bill it for power=20 SAN FRANCISCO - Pacific Gas & Electric Co. has asked a federal bankruptcy= =20 judge to stop the state's power grid manager from charging the utility for= =20 expensive last-minute electricity it has bought.=20 California's largest utility filed the motion Thursday asking that the=20 Independent System Operator comply with bankruptcy law ... and stop billin= g=20 the utility for wholesale power purchased.=20 The utility is barred from repaying debts incurred before its bankruptcy=20 filing without permission from U.S. Bankruptcy Judge Dennis Montali. PG&E= =20 also wants to stop paying the bill for any future ISO buys on its behalf.= =20 Jones floats plan to try to rescue utilities state=20 SACRAMENTO - Saying power purchases will drive California deeply into debt= =20 Secretary of State Bill Jones proposed a utility rescue plan Thursday that= =20 would take the state out of the electricity business.=20 The state of California must get out of the power business immediately to= =20 avoid mortgaging our children's future said Jones a Republican candidate= =20 for governor.=20 If the governor doesn't change course it will take decades for California= 's=20 budget and economy to recover.=20 Jones' four-part plan calls for:=20 Utility creditors to accept less than full payment in exchange for immediat= e=20 partial compensation.=20 A significant infusion of cash from the utilities' parent companies to he= lp=20 pay off the debts.=20 The utilities to accept less than full payment for money they owe themselve= s=20 for power they generated and sold to themselves at high prices through the= =20 state power pool.=20 The state would make low-interest loans to the utilities to cover the rest = of=20 their debts.=20 Instead of the state buying the utilities' transmission lines as Davis has= =20 proposed the utilities would retain them as loan collateral.=20 PG&E suit for $10 billion from ratepayers dismissed=20 SAN FRANCISCO - A federal judge has dismissed as premature a lawsuit filed= =20 against the state's Public Utilities Commission by California's largest=20 utility Pacific Gas & Electric Co. that sought $10 billion from Californi= a=20 ratepayers.=20 PG&E had asked the U.S. District Court in Los Angeles to overrule PUC=20 decisions that the utility was not entitled to the money which the utility= =20 spent buying electricity on the increasingly expensive wholesale market.=20 District Judge Ronald S.W. Lew dismissed the suit Wednesday saying PG&E's= =20 claims are not yet ripe for review. He said PG&E may refile once the=20 commission's interim orders become final and a PG&E statement afterwards= =20 said that allows us to continue to pursue the merits of the case.=20 State weighed connecting power grid to nuclear ships=20 SAN DIEGO - California officials considered tapping nuclear-powered warship= s=20 to supplement power during peak demand this summer but dropped the idea=20 after deciding it wasn't worth the effort Pentagon officials said Thursday= .=20 Linking nuclear-powered submarines and aircraft carriers to the state power= =20 grid is possible but would yield little electricity for the extensive=20 modifications that would be required Pentagon spokesman Rear Adm. Craig=20 Quigley said.=20 It would not be much of an advantage ... to go through that engineering= =20 Quigley said.=20 Davis to ask generators for profit concessions=20 SACRAMENTO - Gov. Gray Davis asked the chief executives of the largest U.S.= =20 energy producers and traders to meet with him next week when he will ask= =20 them to forgo some profit from selling power in the state.=20 The meeting is set for Wednesday in Sacramento.=20 The Associated Press Bloomberg News and Register staff writer Kimberly Kin= dy=20 contributed to this report.=20 U.S. conservation order called Bush's best effort=20 The energy chief says there's not enough time for other action.=20 May 4 2001=20 By DENA BUNIS The Orange County Register=20 WASHINGTON - President George W. Bush's order that federal agencies conserv= e=20 every megawatt they can is the best way he can help California live through= a=20 hot summer of expected blackouts the nation's energy chief said Thursday.= =20 We have a crisis and an emergency this summer that could result in 30 to 3= 5=20 days of some form of blackouts taking place in California'' Energy Secreta= ry=20 Spencer Abraham said after a White House meeting of the president's energy= =20 team. We don't have time between now and those occasions to develop new-= =20 generation sources sufficient to meet that challenge.''=20 Bush's order directs all agencies to report to Abraham within 30 days on=20 their plans for conserving power during peak demand and particularly in=20 California during electricity emergencies.=20 We're worried about blackouts that may occur this summer'' Bush said afte= r=20 his meeting. And we want to be a part of any solutions.=20 When California reaches a Stage 2 emergency which means electricity reserv= es=20 fall below 5 percent federal facilities will implement a conservation plan= =20 that includes setting thermostats at 78 degrees. Other measures under=20 consideration include installing more efficient lighting closing off=20 unneeded space and doing some work at off-peak times.=20 Off the table Abraham said were suggestions that the federal government= =20 transfer power to the state from nuclear submarines or aircraft carriers.= =20 They would yield little power and the potential for safety problems was=20 great.=20 Federal power usage amounts to a little less than 2 percent of California's= =20 electricity needs. About 1 percent of that is at military installations.=20 Deputy Defense Secretary Paul Wolfowitz said his department's goal is a 10= =20 percent reduction in electricity use this summer and an additional 5 percen= t=20 by next summer.=20 We are going to do our part to try to mitigate the energy shortage through= a=20 combination of conservation power generation an investment in energy=20 efficient methods'' Wolfowitz said.=20 Abraham said there is no firm figure for nonmilitary conservation.=20 He flew to California on Thursday afternoon another effort to blunt=20 criticism of the administration's inaction during the crisis.=20 He met with Gov. Gray Davis and was to meet today in San Francisco with=20 federal officials to talk about the conservation plan.=20 Davis on Wednesday had criticized the impending order as not enough. The=20 state has cut usage by 20 percent.=20 Every time we take an action there's someone somewhere who says we should = do=20 something different'' Abraham said. We think this is the most constructiv= e=20 action we can take in this time.''=20 And while Sen. Dianne Feinstein D-Calif. said of the president's action= =20 that every little bit helps'' she and other Western senators Thursday=20 continued to criticize federal regulators for not going further to curb=20 prices.=20 This is unsustainable politically for this administration for this=20 Congress said Republican Sen. Gordon Smith of Oregon. Smith and Feinstein= =20 have authored a bill to allow much deeper price controls than those approve= d=20 by the Federal Energy Regulatory Commission last week.=20 On the long-range front Bush met with Mexican President Vicente Fox on=20 Thursday. They talked generally about the U.S. importing energy from Mexico= =20 and Canada countries with large oil and gas reserves. [B] POWER UPDATE/ Bush directs feds to save energy in California (BridgeNews) May 3 1952 GMT/1552 ET TOP STORIES: Bush directs federal government to save energy in California Washington May 3 (AP) - President Bush on Thursday ordered all federal agencies in California to cut power use saying we want to be a part of a= ny solutions to an energy crunch that could cripple the largest state. ( Story .19646 ) Air emissions exemptions in House energy bill criticized Santa Fe N.M. May 3 (BridgeNews) - Legislation to temporarily exempt new power plants from air emissions limits isn't needed because state and feder= al regulations are flexible enough to allow for maximum output Michael Kenney= =20 an executive of the California Air Resources Board said Thursday testifying before a U.S. House Energy and Air Quality subcommittee. Others argued provisions of the bill allowing businesses to generate and sell their own= =20 power are harmful to the environment and unfair to certain consumers. ( Story .19200 ) Pacificorp calls for region-wide US West power price cap Santa Fe N.M. May 3 (BridgeNews) - Pacificorp wants region-wide price caps in U.S. western power markets with all market participants under the s= ame price mitigation rules a company representative told a U.S. House energy subcommittee Thursday. The company is one of the few investor-owned utiliti= es outside of California to adopt such a position. ( Story .18379 ) Repeats: Duke Energy: Will pay to end Calif. power price probe Santa Fe N.M. May 2 (BridgeNews) - Duke Energy North America said Wednesday it will build new generation in California sell power on a=20 long-term basis forgive some unpaid bills by state utilities and repay alleged overcharges for wholesale power if all investigations into alleged price-gouging by state and federal authorities are resolved at the same tim= e. Duke admitted no wrongdoing. ( Story .16332 ) OF INTEREST: --AMERICAS-- US Northeast real-time power prices high on warm weather Toms River N.J. May 3 (BridgeNews) - Real time power prices in the Northeast U.S. were relatively strong early Thursday as above-normal temperatures swept through the region. However most daily prices slipped a= s lower temperatures are forecast to move in on Friday. ( Story .17034 ) Calif. Gov. Davis says 50 Mw power plant licensed for summer New York May 3 (BridgeNews) - California Governor Gray Davis announced Wednesday the licensing on a 50 Mw King City power project. This makes the fifth summer reliability power plant that has been permitted under the California Energy Commission's expedited emergency review process. ( Story .18775 ) FOCUS: Natgas distributors ready for possible summer price spike New York May 3 (BridgeNews) - Local distribution companies (LDCs) do not plan to get caught short if warmer temperatures drive up the price of natur= al gas this summer. LDCs say they are ready for the possibility and are using various strategies including hedging gas costs and entering into long-term supply pacts to avoid having to buy in an extremely volatile spot market. ( Story .18313 ) Fund companies see US energy policy benefiting power sector New York May 3 (BridgeNews) - As the U.S. flirts with an energy shortage and dramatic fuel and power price hikes mutual funds are salivating over t= he prospects for companies like Duke Energy Corp. Calpine Corp. and Dynegy I= nc. Alternative energy companies like Capstone Turbine Corp. and Ballard Power Systems Inc. however are being left out in the cold as federal energy pol= icy has shifted from emphasizing conservation to feeding supply. ( Story .15998 ) FULL: Allegheny Energy unit closes buy of Midwest gas-fired oprs New York May 3 (BridgeNews) - Allegheny Energy Inc.'s Allegheny Energy Supply Co. LLC unit completed the acquisition of 1710 megawatts of natural gas-fired merchant generating capacity in three Midwest states from Enron Corp.'s Enron North America. --Rajesh S. Kurup BridgeNews ( Story .17696 ) US Press: Bush to order energy conservation at Calif. govt buildings New York May 3 (BridgeNews) - President George Bush is expected Thursday to order federal office buildings in California to conserve energy this sum= mer as a way of helping to address the state's power crises and deflect critici= sm that the administration's energy policy is focusing solely on increased production the New York Times reported Thursday. ( Story .16906 ) --EUROPE-- Nuclear reactor shut down in central Russia due to minor glitch Moscow May 3 (BridgeNews) - A nuclear reactor was automatically shut down Thursday at the Balakovo nuclear power plant in Central Russia due to a min= or glitch in its electricity system state utility Rosenergoatom said. The electricity fault presented no threat to the plant's safe operation and the radiation level at the site remained normal Rosenergoatom added. ( Story .12186 ) Shell Q1 adj profits up 23% at $3.855 bln beating forecasts London May 3 (BridgeNews) - Royal Dutch/Shell on Thursday reported adjusted earnings on a current cost of supplies (CCS) basis for the first quarter of 2001 of $3.86 billion up 23% from $3.13 billion for the same quarter last year. Net income for the quarter was $3.89 billion up 17% fro= m $3.34 billion in the three months of 2000 the company said. The figures we= re above the top end of analysts' forecasts which had pointed to adjusted CCS earnings of between $3.1-3.6 billion. ( Story .12297 ) FOCUS: Scottish Power rides west U.S. crisis no clues on S. Water London May 3 (BridgeNews) - Scottish Power is focussing on consolidating its position in the U.S. since its purchase of Pacificorp and amid the ongo= ing power crisis in the Western U.S. chief executive Ian Russell told reporter= s=20 at a conference Thursday. Russell said that Scottish Power had not yet made a decision on the future of Southern Water and would not be drawn into speculation over the likelihood of a sale to Italy's Enel. ( Story .16660 ) --ASIA/PACIFIC-- Taiwan to accept bids for new power plants around May-end Taipei May 3 (BridgeNews) - Taiwan authorities plans to open a new round of bidding around the end of May for independent power producers (IPPs) to generate a total of 4200 megawatts (MW) of electricity commencing in 2007-2009 an official at the Energy Commission under the Ministry of Econo= mic Affairs (MOEA) said Thursday. The invitation for IPP projects will be the fourth of its kind. ( Story .10571 ) SPOT NEWS LINKS: THE MARKETS: US FUTURES: UK FUTURES .1908 NY Natural Gas Pre-Opg .1795 IPE Nat Gas Review .1906 NY Natural Gas Review .1794 IPE Nat Gas Midday .1747 NY Natural Gas US/CANADA CASH NATURAL GAS UK/EUROPE CASH NATURAL GAS .1894 Henry Hub natural gas .1807 UK Spot Gas .1884 US/Canada Spot Natural Gas US CASH ELECTRICITY UK/EUROPE CASH ELECTRICITY .8575 California PX: Next day .1892 UK Power Index 0.0 .8576 .8577 WSCC Forwards (AM/PM) .1889 Nordic Power Market .8585 .8586 PJM Forwards (AM/PM) .1890 Spanish Power Market .8593 .8594 Cinergy Forwards (AM/PM) .1844 UK EFA Power Market .8597 .8598 Entergy Forwards (AM/PM) CANADA CASH ELECTRICITY .8601 .8602 ERCOT Forwards (AM/PM) .5637 Canadian Power Market .8603 New England Forwards .8587 .8600 TVA Forwards (AM/PM) OTHER .1873 US Nuclear Plants Operating Status .2029 BRIDGE CALENDAR: US POWER: Key events to watch .2030 US Utility Deregulation Digest .1704 US Utility M&A Digest SYMBOL LINKS: Click below for adamb chart in Athena NATURAL GAS NYMEX - IPE - NYMEX ELECTRICITY Palo Verde electricity - COB electricity- Cinergy electricity - Entergy electricity - PJM electricity - BridgeNews Send comments to gennews@bridge.com Judge Dismisses $10B PG&E Suit By KAREN GAUDETTE Associated Press Writer SAN FRANCISCO (AP) via NewsEdge Corporation - A federal judge has dismissed a lawsuit filed against the California Public Utilities Commission by the state's largest utility which sought $10 billion from ratepayers. PG&E had asked the U.S. District Court in Los Angeles to overrule PUC decisions that the utility was not entitled to the money which the utility spent buying electricity on the increasingly expensive wholesale market. In dismissing the lawsuit Wednesday Judge Ronald S.W. Lew said ``PG&E's claims are not yet ripe for review'' meaning the case wasn't ready for trial. Steve Maviglio spokesman for Gov. Gray Davis declared the decision a win for California ratepayers. ``PG&E was banking on winning this case and using it as one of their excuses for not negotiating with the governor. It appears at least for now they failed'' Maviglio said. But because the case was dismissed on procedural grounds rather than merit PG&E said the door was left open for the utility to refile its action once the commission makes final its interim orders on PG&E's requested rate increase. ``The court determined that our lawsuit was premature because the CPUC had not yet finalized its various decisions on PG&E's request for recovery of its costs to purchase wholesale power'' PG&E said in a statement. ``Today's action allows us to continue to pursue the merits of the case on a timely basis.'' A similar federal case filed by Southern California Edison is on hold said company spokeswoman Clara Potes-Fellow. Edison the state's second-largest utility would drop that case as part of a rescue plan negotiated by Davis which also includes the state buying the utility's transmission lines for $2.7 billion. Since last June the two utilities say they have lost more than $14 billion. California's 1996 deregulation law froze electricity prices for customers of the state's three investor-owned utilities. When prices rose to record levels over the past year PG&E was unable to recoup the higher costs from its customers' bills. The undercollection along with a failed deal to sell its transmission lines to the state drove PG&E to file for federal Chapter 11 bankruptcy protection on April 6 the company argued. On Wednesday the parent company PG&E Corp. reported a first-quarter loss of $951 million or $2.62 per share. The first-quarter loss follows a fourth-quarter loss of $4.1 billion that also stemmed from continuing costs in California's power crisis. Bankruptcy Update/ PG&E Files Motion to Require CAISO to Follow Federal Law SAN FRANCISCO--(BUSINESS WIRE)--May 3 2001 via NewsEdge Corporation - Pacific Gas and Electric Company has filed a motion in the U.S. Bankruptcy Court asking the court to direct the California Independent System Operator (CAISO) to comply with bankruptcy law its Tariff and a recent Federal Energy Regulatory Commission (FERC) ruling and stop billing the utility for wholesale power purchased. Pacific Gas and Electric Company's motion which includes a request for a preliminary injunction asks the court to enjoin the CAISO from requiring the utility to pay costs the CAISO has incurred and continues to incur to purchase wholesale power on its behalf unless the utility can fully recover these costs. Bankruptcy law imposes an automatic stay to prevent parties from making certain claims or taking certain actions that would interfere with the estate or property of the estate of a Chapter 11 debtor. By purchasing power at costs higher than existing retail prices and then sending the bill to the utility the CAISO is violating the automatic stay provision and could be reducing the value of the company's assets by potentially hundreds of millions of dollars per month depending on the average retail rate the wholesale price and the amount of power purchased by the CAISO. Recently the CAISO sent Pacific Gas and Electric Company a bill for January and February spot market purchases that totaled nearly $1 billion. The action alleges that requiring the utility to pay more than it can collect in its existing generation-related rates would be improper under federal Bankruptcy Code because it is not in the best interest of the estate would be an unauthorized post-petition use of Pacific Gas and Electric Company's property and would force the utility to undertake credit on onerous terms. In addition on April 6 2001 FERC ordered the CAISO to comply with its February 14 order in which FERC ordered that the CAISO could only buy power on behalf of creditworthy entities. Both Pacific Gas and Electric Company and Southern California Edison Company are no longer creditworthy companies. By continuing to purchase power on behalf of Pacific Gas and Electric Company the CAISO is in violation of its own Tariff FERC orders and federal law. CONTACT: Pacific Gas and Electric Company | News Department= =20 415/973-5930 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Important - CPUC Motion - Confidential Attorney Client Privilege and Work Product Body:: As you may already know the CPUC filed a motion at FERC asking for a protective order and to compel production of the information they subpoened from us in the CPUC's OII case. Given the timing we should discuss this on our conference call scheduled for tomorrow. They request that we be required: to answer their motion on Thursday to provide the information within 5 working days of a FERC ordering production and to provide of P&L information and spread sheets detailing our deals specifically delivery point delivery date counterparty volume and price. We may not have a problem providing this information for use by FERC in its proceeding subject to a confidentiality agreement but I think we would oppose their requests for: the information to be provided for government eyes only - this would prohibit EPMI from defending itself vis-a-vis other market participants. a FERC confidentiality order that would could allow FERC to share this information with the CPUC (for purposes of the PUC's OII proceeding) pursuant to 16 U.S.C. 824h(c). 16 USC 824g(c) requires the Commission to make information available to state commissions as may be of assistance in state regulation of public utilities. We should argue that 16 USC 824h(c) does not apply here given that we are not a public utility nor does the PUC regulate how much market power wholesale marketers exercise or the level of market power mitigation (these are the bases the PUC provides for explaining why it should have this information.) the above contractual information to allow them to analyze the competitiveness of the forward market to evaluate the wisdom of the Commission's decision to allow the UDC's unfettered access to the forwards market. This argument is unpersuasive given that the CPUC can get information about the competitiveness of the forward markets from the Wall Street Journal's listing of NYMEX prices. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FERC comments Body:: Please coordinate with PGE on the comments. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Will Hixon - UT Candidate Body:: I don't see a fit Lexi Elliott 02/28/2001 02:39 PM To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Chris Harman/Enron Communications@Enron Communications Subject: Will Hixon - UT Candidate Steve: Per my voicemail message to you I have forwarded Will's resume for your consideration. Thank you! lexi ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: California Power Markets Body:: Thanks for the analysis. We understand that McKinsey may be helping the Governor develop a demand buy down program. Is this true? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: European Trip Report 22-30 Jan 2000 Body:: FYI ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Console Tape Recordings Body:: fyi ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Draft Letter to FERC by Consumer Groups Body:: Looks good. How about a point about the need to connect new generation=20 quickly. =09Sarah Novosel =0909/26/2000 09:55 PM =09=09=20 =09=09 To: skean@enron.com Richard Shapiro/HOU/EES@EES Sue Nord/NA/Enron@= Enron=20 Margaret Carson/Corp/Enron@ENRON Rob Bradley/Corp/Enron@ENRON=20 mpalmer@enron.com Karen Denne/Corp/Enron@ENRON Jeff=20 Dasovich/NA/Enron@Enron James D Steffes/NA/Enron@Enron =09=09 cc:=20 =09=09 Subject: Draft Letter to FERC by Consumer Groups Below is my first rough draft of a letter that could be sent from consumers= =20 to FERC Chairman Hoecker. Due to technical difficulties I could not attac= h=20 the letter in a separate document so I copied the letter and have reprinte= d=20 it below. Having never been involved in this type of letter writing campaign this wa= s=20 a bit of a stab in the dark for me so I welcome everyone's comments. I am= =20 also working on a letter that could be sent by senior management or CEOs of= =20 high tech firms but I wanted to get your feedback on this format before I= =20 went forward on the high tech letter. Let me know if you have any questions or comments. Sarah September 26 2000 The Honorable James Hoecker Federal Energy Regulatory Commission 888 First Street N.E. Washington D.C. Re: Electric Power Industry Reform Dear Chairman Hoecker: We are consumers or represent consumers of electric power. We write to urg= e=20 you and your colleagues to take the initiative to address the intolerable= =20 shortages and extreme price volatility that have become all too common in t= he=20 electric power industry. It is imperative that the Federal Energy Regulato= ry=20 Commission proceed expeditiously with the reforms needed to support a=20 competitive and efficient power supply industry to ensure a reliable supply= =20 of power at the lowest possible cost to consumers. There are many actions you and your colleagues should take to ensure that t= he=20 power supply in the U.S. remains sufficient and is available at reasonable= =20 prices. For example you and your colleagues should remove roadblocks in t= he=20 nation=01s electricity gird. Under the current system FERC regulations a= llow=20 many companies that own transmission systems to restrict access to their=20 transmission lines by competing electricity suppliers. The result of this= =20 policy is shortages blackouts and skyrocketing prices. Like the interstat= e=20 highway system FERC should allow electricity to move from one state to=20 another just as freely as motorists do. All electricity suppliers should= =20 have the same access to the transmission lines in order to transport power = to=20 where it is most needed. FERC should also discourage electricity suppliers=01 reliance on spot and= =20 short-term electricity markets for power supply. Instead FERC should urge= =20 suppliers to purchase a portion of their power needs under long-term=20 contracts. Locking in electricity costs at fixed prices protects consumers= =20 from unexpected price swings that can be financially devastating. We strongly urge you and your colleagues to seize the initiative on these= =20 reforms. Consumers deserve a power supply industry that is both more=20 reliable and economical.=20 Very truly yours What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: External Advisory Council Body:: Having worked on the Enron Advisory council process I have one observation: consider having some or all of these individuals as guest speakers rather than formal memebers. You can still have them review information do their homework and tailor their remarks to Enron specifics. Also you should definitely include Paul Portney at Resources for the Future. He sits on the Enron Advisory Council and knows the company well. Kelly Kimberly@ENRON COMMUNICATIONS Sent by: Stacy Walker@ENRON COMMUNICATIONS 03/01/2001 02:27 PM To: Brian Stanley/EU/Enron@Enron Dan Bruce/Enron@EnronXGate Dave Schafer/NA/Enron@ENRON Eddie Clay/EFS/EES@EES Elyse Kalmans/Corp/Enron@ENRON Gene Humphrey/Enron@EnronXGate George Wasaff/Enron@EnronXGate Gregory Adams/Corp/Enron@ENRON Hap Boyd/EWC/Enron@Enron James A Jean Mrha/NA/Enron@ENRON Jimmy Mariella Miguel Padron/NA/Enron@ENRON Mark Schroeder/LON/ECT@ECT Michael Terraso/OTS/Enron@Enron Mitchell Taylor/Enron@EnronXGate Paula Rieker/Corp/Enron@Enron Rick Buy/Enron@EnronXGate Rob Walls/ENRON@enronXgate Shelley Corman/Enron@EnronXGate Steven J Kean/NA/Enron@ENRON Tim DeSpain/HOU/ECT@ECT Vicki Sharp/HOU/EES@EES cc: Nicola Blancke/EU/Enron@Enron Mary Lisa Costello/NA/Enron@Enron Barbara Zulie Flores/Corp/Enron@ENRON Bert Frazier/Enron@EnronXGate Karina Prizont/Enron@EnronXGate Dortha Gray/GPGFIN/Enron@Enron Connie Melissa Jones/NA/Enron@ENRON Leena Isabel Beverley Ashcroft/LON/ECT@ECT Laura Glenn/OTS/Enron@ENRON Karen E Campos/NA/Enron@ENRON Rosario Boling/Enron@EnronXGate Laura Valencia/Corp/Enron@ENRON Karen K Heathman/Enron@EnronXGate Debra Hicks/Enron@EnronXGate Ruth Mann/Enron@EnronXGate Maureen McVicker/NA/Enron@ENRON Marion Sczykutowicz/HOU/ECT@ECT Leasa Lopez/HOU/EES@EES Lauren Iannarone/NY/ECT@ECT Catherine McKalip-Thompson/Enron Communications@Enron Communications Susan Subject: External Advisory Council As we discussed at the last Corporate Responsibility task force meeting one activity that we have underway is recruiting an external advisory council. This council will be comprised of global experts on environmental and social issues from non-governmental organizations and potentially other businesses to advise us on trends and issues in this area. An outline of the advisory council structure along with categories of experts and proposed names is attached below. We expect to convene meetings with this group twice a year inviting the Enron executive committee and board of directors as well as the Corporate Responsibility task force to engage in a dialogue. We plan to present a slate of possible candidates to Ken Lay and Jeff Skilling later this month and would appreciate your input and any ideas by March 16. Thanks for your consideration. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: FYI. From today's Post. Davis seems to continue to put distance between himself and the contracts. Best Jeff Financial California Changes Stance on Refunds Two Sides Far Apart In Energy Talks Peter Behr ? 07/06/2001 The Washington Post FINAL Page E01 Copyright 2001 The Washington Post Co. All Rights Reserved California officials have abruptly shifted tactics in their attempt to recover billions of dollars in alleged overcharges for electricity saying they may reduce their demands for huge refunds if generators renegotiate $43 billion in long-term electricity contracts that the state signed this year. Gov. Gray Davis (D) said part of the $8.9 billion in refunds the state is seeking could be offset by reductions in energy prices in the long-term contracts whose costs have become a growing political embarrassment for Davis. We've made suggestions we've offered various ways in which people could get us $8.9 billion Davis told the San Jose Mercury News in a report yesterday. You can renegotiate our existing contracts and save us money. However you want to do it it's just got to net out close to $8.9 billion. The new offer was introduced this week into the closed negotiations over a California settlement being conducted in Washington by Federal Energy Regulatory Commission Judge Curtis L. Wagner Jr. according to sources close to the negotiations. Yesterday Wagner said he may issue his own preliminary finding today on the amount of overcharges if California officials and the generators cannot reach a compromise. What I'm trying to do is get people in a settlement mood Wagner told reporters. In the event we're unable to do that [Friday] at some point I may offer a preliminary assessment. The settlement conference is set to conclude on Monday. Wagner FERC's chief administrative judge has been trying to push both sides toward a compromise that would resolve the huge energy pricing controversy. Mountainous energy prices have bankrupted California 's largest utility drained billions of dollars out of the state treasury and put Davis at sword's point with generators that help keep the state's lights on. Last Friday Wagner rebuked Davis's chief representative Michael Kahn chairman of California Independent Grid Operator -- the state's power grid manager -- indicating that the state's demand for nearly $9 billion in refunds from power generators and marketers was too high sources said. Wagner's settlement conference which has involved more than 100 lawyers for all sides is closed to the public and media. Wagner complained last month that Kahn was following a political agenda and his lack of independence in the negotiations was such a joke that the parties might as well wear clown suits according to a Dow Jones report confirmed by sources close to the talks. But he has also criticized the generators and power marketers led by Reliant Energy Inc. Williams Energy Services Duke Energy and Southern Co. for failing to make serious settlement offers these sources said. The suppliers have offered to refund $600 million provided the state is able to call off various California lawsuits demanding far larger refunds sources said. Wagner's leverage is his ability to propose his own refund figure to FERC's commissioners. FERC has tentatively called for $124 million in refunds but now is taking a harder line on preventing a new escalation of California 's electricity prices this summer and is likely to be receptive to a higher refund figure some energy analysts believe. Davis's tactical change offering to make the long-term contracts part of an overall settlement comes amid growing criticism of what the state will have to pay for energy under those deals. California 's energy calamity stemmed in large part from its failed deregulation plan which relied heavily on short-term power purchases at volatile spot market prices. When energy costs shot upward last summer so did the state's electricity bills. In response Davis's aide S. David Freeman and his staff began negotiating long-term power contacts with suppliers. The $43 billion in deals signed so far would require the state to pay about $70 per hour for a megawatt of power for a large part of the electricity it will need over the next 10 years. That's well under the average of $250 per megawatt-hour that the state was paying at the beginning of this year but above current power prices -- and considerably higher than what electricity may cost in the next decade energy analysts say. A new agreement to lower those contract prices could relieve political pressure on Davis and focus settlement negotiations away from the state's controversial demand for the $8.9 billion refund. Davis will argue that reducing future power charges that his administration negotiated should count as a refund because the deals were reached under commercial duress according to sources close to Wagner's negotiations. Industry supporters say Davis's refund figure is impossible to justify. There's no benchmark for what a fair and reasonable price should be said Michael Zenger California director of Cambridge Energy Research Associates. The state's advocates counter that if FERC enforced a just and reasonable standard for power prices based on operating costs and a generous profit the overcharges by all sellers could easily reach the $9 billion figure. It's not rocket science but it does require the regulators to regulate said Frank Wolak a Stanford University economist who heads an oversight committee for the California grid. Those polar-opposite views have left both sides in Wagner's conference room billions of dollars apart as the talks approached their final weekend sources said. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Follow up -- Council of Energy Advisors Body:: I doubt that this is worth the trouble (i.e. running it through a conflict of interest check ensuring no liability for actions taken on the advice etc). From: Sherri Sera/ENRON@enronXgate on 06/21/2001 10:13 AM To: Steven J Kean/NA/Enron@Enron cc: Joannie Williamson/ENRON@enronXgate Subject: FW: Follow up -- Council of Energy Advisors Steve we have no record of receiving the original invitation but is this anything you would recommend? Please advise. Thanks SRS What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - General Expenses Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Houston 1996 - 2001 Body:: I am so sorry. You guys gave him a really good life. Robert Kean on 07/07/2001 01:48:08 PM Please respond to To: Pat Hilleman \(E-mail\) Greg Smith \(E-mail\) Greg Smith \(E-mail 2\) Colin Lamb \(E-mail\) Maggie Kean \(E-mail\) Nora Kean \(E-mail\) Nora Kean \(E-mail 2\) Sann & Evelyn Gossum \(E-mail\) Doug & Karen Reiman \(E-mail\) Jean Kean \(E-mail\) Kathy Wedig \(E-mail\) Melissa Kean \(E-mail\) Phil Kean \(E-mail\) Steve & Melissa Kean \(E-mail\) cc: Subject: Houston 1996 - 2001 Houston died today after a long battle with Auto Immune Hemolytic Anemia. Rest in peace. Rob Kean What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FERCs Prospective Mitigation and Monitoring Plan for CA Wholesale Electric Markets Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Vince I am writing about a student of mine who is on the job market this year. When you stopped by my office about 18 months ago you asked if I had any students that might be appropriate for your group. Although I didn't at the time now I do. This student has excellent technical skills including an M.S. in Statistics and a Ph.D. in Economics by the end of the current academic year. His dissertation research is on the investment behavior of Independent Power Producers in the US. As a result of research assistance he has done for me he knows the California market very well and is familiar with the other ISOs. I think he would be an excellent match for you. The only problem is that he will probably have many other options available. However I definitely think he's worth a look. If you'd like him to send you a CV please let me know. Thanks. Frank Wolak Professor Frank A. Wolak email: wolak@zia.stanford.edu Department of Economics Phone: 650-723-3944 (Office) Stanford University FAX: 650-725-5702 Stanford CA 94305-6072 Phone: 650-856-0109 (Home) World-Wide Web Page: Cell Phone: 650-814-0107 What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Attached is my testimony. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California CTC meeting in EB791 - Maureen Palmer Body:: Also invited Lou Pai Dave Duran Dave Parquet Sean Holmes John Henderson Marty Sunde Jim Fallon What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Stelzer remarks at advisory board meeting Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential Contact data and RFI Body:: I'll get back with you on this within a couple of days. Do you want an indicative bid for 7x24 bus-bar energy (2 5 and 10 years). We would not bid on the entire 1000 MW - maybe 150-200 MW. thanks for the info. Kevin Presto UBS Warburg Energy kevin.presto@ubswenergy.com Phone: 713-853-5035 Fax: 713-646-8272 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: New document in PSerc Document Archive archive Body:: Dennis Thanks. I have seen some of the papers you mentioned but missed one about discriminative auctions. Vince Kaminski What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:NEMEC GERALD Email:gerald.nemec@enron.com - 7138533512 ? Enron Wholesale Services - Office of the Chairman ? From:??Mark Frevert Chairman & CEO ??????Greg Whalley President & COO ??????Mark Haedicke Managing Director & General Counsel ? Subject:??Confidential Information and Securities Trading ? Enron Wholesale Services ('EWS') maintains official Policies and Procedures Regarding Confidential Information and Securities Trading ('Policies and Procedures') which have been revised as of November 15 2000 to reflect the new EWS structure. These policies and procedures are intended to allow us simultaneously to pursue our diverse businesses and to protect confidential information our reputation for integrity and EWS and its employees from legal liability. ? You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: ? ? You must certify your compliance with the Policies and Procedures within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Lance Schuler at extension 3-5419 Mark Haedicke at extension 3-6544 Alan Aronowitz at extension 3-3214 Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Schedule for the Schedules Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential Employee Information/Lenhart Body:: I also need to know the base salaries of Jay Reitmeyer and Monique Sanchez. They are doing the same job as Matt. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Wimbledon update Body:: Yes you are. Mark Palmer@ENRON 07/17/2000 09:32 AM To: Steven J Kean/HOU/EES@EES cc: Subject: Wimbledon update I left Hannon a message that we PAID for the attention we got from Wimbledon. It came out of the advertising budget. We did Kevin a favor by trying to leverage our media budget to create new business for EBS. Am I looking at this the right way? Mark ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Body:: Frank Thanks for your message. We are confirming a meeting in your office at 4:00 p.m. Tuesday next week. What about a dinner at 7:00? Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - RS032901 Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - 041601LC Body:: ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Bingaman Draft On Transparency -- Amendment Ideas Body:: Last night Linda and I spent a fairly long time with Leon Lowery Chairman Bingaman's chief electricity advisor to discuss our concerns with the transparency and market-based rate language -- while at the same time commending the transmission access language in the draft and strategizing how to support the chairman in that regard. We made progress on transparency less so on market-based rates. On transparency Leon understands our concerns. In a nutshell he seemed amenable to amending the langauge to avoid the result of having to divulge transaction-specific trade-specific information. We persuaded Leon that was the impact of the initial language although he initially said details would be left to FERC. We persuaded him that if any data is to be provided it MUST be only in aggregate form. We also impressed on him that if as he said the intent is to leave details to FERC -- then more of the details should be left to FERC not set by statute. Leon strongly advised that we seek to craft language consistent with the above exchange that makes as few changes to the draft as needed to make the necessary corrections. This will make it easier for Leon to navigate the internal waters of the staff. (Sam Fowler th chief counsel is a drafting stickler). Others should obviously weigh in and review this but to facilitate internal comments (we need to get back to Leon today) here is my take on what he has in mind. Under new sec. 218(b) (to be added to the FPA by bill sec. 413) (pg. 13) under information required we would rewrite paragraph 2 as follows: (2) each broker exchange or other market-making entity that matches offers to sell and offers to buy wholesale electric energy in interstate commerce to provide aggregate statistical information about its sales of electric energy at wholesale in interstate commerce. The effect of the language change is drop the reference to sale prices of each sale of electric energy. By leaving it as aggregate statistical information this should give FERC maximum flexibility to permit indexes etc. As to the timely basis of information release (subsection (c)) the alternatives sent yesterday would require this to be done on the Internet after the end of the trading day. If we can restrict this to aggregate data question arises whether we want to concede that this would be done daily. That suggests the data to be collected would be more than we would want I think. Here is a take on how we might suggest a revision to that language to give FERC more leeway: (c) TIMELY BASIS -- The Commission shall require the information required under subsection (b) to be posted on the Internet and updated as frequently as practicable and appropriate. The change is to add appropriate so that FERC can consider other than whether posting is practicable. The use of appropriate is what came to mind -- perhaps there is some other word or phrase like consistent with ... or promote competition or some way of saying there are policy considerations other than practicability. There should be some valid purpose established before data is released. I would argue that the (d) language on commercially sensitive information goes only to exempting from disclosure not when disclosure is appropriate. Please let me have your thoughts although the tragedy in NYC and DC now underway will probably make this not a day to transact such business on the Hill. Will provide a further report on market-based rates. In sum Leon was not as sympathetic on this issue but asked for our ideas and further arguments. We sense Leon personally feels strongly about moving the FPA to some linkage to competitive markets. His argument is that market participants can be doing everything by the book and the result can still be uncompetitive markets. We pushed that penalizing us is not the answer -- nor is increasing regulatory uncertainty about deals doing to help keep prices down. Leon clearly does not intend this language to punish Enron -- but others who we might all agree have done things that are not in keeping with competitive markets. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: 2001 budget Body:: I do support the change. Let me know what I can do to help. You are correct: this is the way we handle regulatory counsel in other regions particularly the US. What Derrick and I have agreed with regard to counsel selection is: gov't/reg affairs picks the counsel we want to use and he retains a veto which has rarely if ever been exercised. Once we have retained counsel we will use that counsel on other regulatory projects unless the legal department starts to have a problem with the firm (eg because they represent someone against us in litigation). Again I don't recall this ever being an issue. It seems to work: outside counsel gets the message that we will look dimly on any firm that squares off against us and we select the most qualified counsel on our issues. Mark Schroeder@ECT 09/01/2000 06:18 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: 2001 budget You should be receiving today a copy of my draft budget proposed for Enron Europe for 2001. I understand from Nick that they are doing their own budget for Enron Japan which I will see only after the fact. MOST IMPORTANTLY you will see that I am budgetting to pay a substantial sum for legal fees. I will be proposing to John Sherriff Michael Brown (our new COO and former General Counsel which will make my proposal doubly problematic) and to Mark Evans (current General Counsel) that I pay/manage our outside regulatory counsel. We can discuss (rather than do a lengthy e-mail) but having this function managed by Legal (and Houston/Jim Derrick rejecting our choice of counsel in important cases) is increasingly a problem. I believe this will mirror what you do in the USA e.g. Dan Watkiss and hope that I can count on your support for this change. thansk mcs What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Last FINAL version Body:: Has this gone to Ken yet. If not please send. Maureen McVicker 06/21/2001 02:55 PM To: Lora Sullivan/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Jeff Dasovich/NA/Enron@Enron cc: Subject: Last FINAL version Lora: This is the new Final version. The difference from the earlier version is - a few slides were taken out and the order of the remaining slides were rearranged. Please get a copy of this new Final to Ken Lay. Thanks. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Davis favors tiered rate increases but still clings to ""no new rate increases"" Body:: He could have solved this problem in 20 minutes right? Jeff Dasovich Sent by: Jeff Dasovich 03/25/2001 12:40 PM To: skean@enron.com Richard Shapiro/NA/Enron@Enron James D Steffes/NA/Enron@Enron mpalmer@enron.com Karen Denne/Corp/Enron@ENRON Susan J Mara/NA/Enron@ENRON Sandra McCubbin/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Harry Kingerski/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Linda Robertson/NA/Enron@ENRON Joe Hartsoe/Corp/Enron@ENRON Tom Briggs/NA/Enron@Enron Alan Comnes/PDX/ECT@ECT cc: Subject: Davis favors tiered rate increases but still clings to no new rate increases Power Hogs May Get Hit In Pocketbook Davis favors tiered rate increases David Lazarus Chronicle Staff Writer Sunday March 25 2001 2001 San Francisco Chronicle URL: N30195.DTL Gov. Gray Davis faced with the near inevitability of raising consumers' electricity bills is leaning toward a rate system whereby those who use more power pay more than those who conserve The Chronicle has learned. Sources close to the governor said he is being lobbied by his own staff members to accept a so-called structured rate system. Top officials from his own administration told lawmakers Friday that the state may end up spending more than twice the $10 billion previously estimated to purchase power on behalf of California's near-bankrupt utilities. If so the officials warned that consumers' electricity rates could double. In the case of Pacific Gas and Electric Co. this would mean customers' average monthly power bills would rise from $60 to $120. Consumers throughout the Bay Area believe that at least some increase is on the way. We're going to have to bite the bullet and pay the money said Larry Webster a retired Caltrans worker in Redwood City. We might as well admit that electricity is no longer a nickel. It's a dime. If you're going to use it let's pay for it. Steve Maviglio a spokesman for the governor distanced himself yesterday from estimates that rates would double. The figures reported in the press he said were wildly high. The governor still believes he can live within the existing rate structure Maviglio said. Until we know the results of the negotiations with the utilities you can't conclude anything. The state is negotiating a multibillion-dollar bailout package with PG&E and Southern California Edison Co. to relieve the utilities of about $13 billion in debt. PG&E and Edison have been saying for months that there is no way California can overcome its current energy woes without higher rates. The irony of the Davis administration now saying the same thing was not lost on the two companies. The state is in the exact same position the utilities were in last fall said John Nelson a PG&E spokesman. Either wholesale prices need to come down or retail prices need to go up. The disparity is too large. Statewide blackouts last week drove home the precariousness of California's energy situation to ratepayers -- and may have served as a blessing in disguise for the governor. COST VS. OUTAGES If given a choice between further outages and paying higher rates many consumers said they would accept increases in their power bills. I don't like either choice said Janet Leroux facing the possibility of a gooey mess if the air conditioning goes out at her downtown San Francisco candy store. But I guess I'd go with higher rates. I sure didn't like the blackouts. Publicly the governor has been insisting for weeks that rates will stay within the existing rate structure -- a stealthy way of saying that January's 9 percent increase and an expected 10 percent increase next year will remain in place. But privately he and his staff are discussing additional rate increases that could be spread over as long as 10 years sources said. Utility executives and power generators told The Chronicle last week that a minimum 30 percent rate increase lasting up to a decade is in the cards. For the good of California it's inevitable said Gary Ackerman executive director of the Western Power Trading Forum a Menlo Park energy industry association. Sacramento resident John Hax observed that when temperatures soar in the Central Valley this summer he'd be more than willing to pay a higher price for power if this keeps the air conditioners on. It's like gasoline he said. I don't like paying higher prices for gasoline but that's the price of doing business. Ratepayers draw the line though at any increase topping 10 or 20 percent. If it was 20 percent I'd probably do it said Tracy resident Mark Dougherty. But if it was more like 50 percent I'd rather go with rolling blackouts. I'd rather have blackouts agreed Jenny Soghomonian owner of a shoe- repair shop in San Francisco's Financial District. I don't want to pay rates that are so much higher. NOT EVERY COST PALATABLE This is the tightrope that state officials and industry players now find themselves walking: While consumers may be willing to pay more to avoid blackouts they aren't willing to swallow virtually any cost thrown their way. Yet if rates are not high enough they may not prevent daily blackout threats this summer and beyond. Higher rates are the price signal that it takes for conservation said Tom Higgins senior vice president of Edison International parent company of Southern California Edison. Simply put he meant that most consumers will not aggressively conserve power and thus alleviate shortages unless there is a financial incentive to do so. Rebates proposed by the governor have met with only a lukewarm response requiring critics say too much effort on the part of individual ratepayers. But a sudden spike in monthly power bills almost certainly would prompt widespread conservation measures. It adjusts consumer behavior Higgins said. People want to get their bills back down. RATES' EFFECT ON USAGE He and other industry sources said higher rates are perhaps the only way Californians will achieve the 10 percent conservation goal sought by the governor -- a move seen as vital if blackouts are to be avoided this summer. It's intellectually dishonest to think there's any other way out of this Higgins said. Consumer activists' initial reaction to any talk of a rate increase comes across loud and clear: No no no. No bailout. No rate increases. No secret deals said Harvey Rosenfield head of the Foundation for Taxpayer and Consumer Rights in Santa Monica. We need to get back to a regulated system. Rosenfield is the biggest fly in the governor's ointment. He has threatened to push through a ballot initiative re-regulating California's power market if Davis cannot find a consumer-friendly way out of the current fix. Because of Rosenfield's past success in writing a ballot measure on insurance rebates which delivered about $800 million to consumers his threat is taken seriously in Sacramento. We've paid too much already Rosenfield said. A fair price is what we were promised by deregulation which was a 20 percent rate decrease. However when he was asked whether there was any room to discuss a structured rate increase such as the idea being promoted by the governor's staff Rosenfield toned down his characteristic rhetoric. Big users should pay more he said after a moment's reflection. I'm open to a tiered system but only if it's fair. Rosenfield quickly added that he would have to see how other consumer advocates felt about the matter before agreeing to negotiate such things with Davis. MOVE TOWARD STRUCTURED RATES Clearly though momentum is building toward a system of structured power rates which probably would include increases of varying sizes for consumers. The California Public Utilities Commission is scheduled to address January's 9 percent rate increase on Tuesday. That increase originally was given only a three-month duration but most observers expect it to be renewed for at least another three months if not longer. PUC President Loretta Lynch declined to comment on the likelihood of rates going up but added her voice to those backing a structured system. I am a fan of restructuring rates to exempt conservation she said. People who use a whole lot of power should pay more. The biggest electricity customer in the state is the state itself now that California is purchasing power on behalf of its cash-poor utilities. The state already has spent about $4 billion buying electricity and has yet to determine how the cash will be recouped from consumers. San Francisco resident Rosita Magee accepts that for California to find its energy footing once more rates will probably be heading up. That way you have more convenience and electricity more stability she said. But Magee has come up with another solution one that doesn't involve rate increases and rolling blackouts. She's moving to Texas. Chronicle staff writers Matthew Stannard and Pia Sarkar contributed to this report. / E-mail David Lazarus at dlazarus@sfchronicle.com. 2001 San Francisco Chronicle ? Page?A - 1 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: california energy prices Body:: Summary of what we discussed the other night: Background: power -- power prices have moved above $1000/mwh in the Northwest and are showing $600-700 for the first quarter of 01 forward prices in California have also moved well above the soft cap of $150. Sellers are exporting power from California to the Northwest. gas -- balance of the month gas in California was trading at $26-27 with Jan trading at $19 feb at $12-14 and Summer at $8. The Cal gas and power utilities remain unhedged (price caps are in place for retail power and utilities continue to buy power from the ISO and PX while gas utilities we believe are primarily buying at spot prices even under their long term deals). The power utilities will continue to book large deferrals and gas utilities will be passing costs through a month or two after incurring them. The impact of the gas price increases will begin showing up in Jan billings to consumers. curtailment rules (gas): More work to be done here but it appears that gas utilities will curtail deliveries in the following order: interruptible first (with some priority for cogens) firm service (with utilities alternating or rolling between generation load and nongeneration load) and core customers last. Curtailment rules apparently allow the utilities to confiscate gas sold to direct access customers What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: CONFIDENTIAL - DO NOT DISTRIBUTE Body:: Steve looks ok. Although I always thought I built Canada. I guess not eh. Lavo. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Penn. conference call Body:: Set up meeting re Mt. St. Helens for next week What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Regulatory Roundtable, in 49C2 Body:: 6:00 Photographer What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Barton,Tauzin letter to Gov. Davis Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CA PWR ISSUE Body:: ----------------- What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: FERCs Settlement Conference on Refunds - Monday, June 25th--CONFIDENTIAL ATTY CLIENT WORK PRODUC Body:: If you've been wondering where Davis's $9 billion overcharge number number comes from attached is the apparent basis of the number which was from a study prepared by Hildebrandt of the CAISO. It was apparently released on the CAISO site on 6/21. Note that the $9billion includes bilateral trade sold to any party. However Hildebrandt cannot say who the supplier is unless DWR CAISO or the PX was the buyer (for those buyers he presumably has detailed data). Thus he can ascribe overcharges to specific jurisdictional generators for only $5.4 billion of the $9billion total. He does not show what specific parties are attrributable to the $5.4 billion. In an earlier study on just ISO R/T strategic bidding supplier names were released inadvertantly by CAISO. Finally as in previous CAISO studies a significant fraction of overcharges (approx $3 billion) comes from before the refund-effective date of 10/1/00. Alan Comnes What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: CONFIDENTIAL Personnel issue Body:: Lizzette. Would you mind getting with Diane on the isue of online harassment prevention training? We have been looking into that form of delivering training. Diane has info from Littler on its proposed training. I think that the costs may be high but I would like your evaluation of The product. Would you mind taking the lead on this? Obviously this is not an issue with huge time sensitivity. Thanks. Michelle What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Sen. Hagels ESI speech Body:: attached is Sen. Hagel's energy speech. He focusses on oil primarily but also does a nice job of framing the importance of sound energy policy to our continued economic growth. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: India Help Body:: Thanks so much for your message. Your communications are always complete firm clear and polite. I am sorry that perhaps the most critical aspect of your efforts -- security-- has been so confused by our end. I understand from John Brindle that the confusion generated by our end has not kept you from accomplishing a great deal of the work anyway. I have asked John to lead the effort to the extent you need him. John and his team are very experienced and have been in contact with and coordination with the London office. Mike Hicks is a good hand but for the most part all I have asked him to do is be in a position to identify outside resources skilled in the area in question. It is a bit too much to ask Mike to be hands on for all of Enron's corporate security needs. A little background I'll bore you with: after Andre Legallo (formerly VP of Security for Enron) left we did not replace his function. Most of the operating companies had their own security and business controls groups. When Andre left we reduced the corporate function to a default provider role -- if a business unit had a need it was not otherwise meeting Mike Hicks (as well as an outside consulting firm) would help identify competent resources in the area. With the reorganization of EBS I have inherited the very competent and experienced team they had assembled (led by John Brindle). John identified some concerns regarding India mid last week. I urged him to get in touch with Rebecca he did. It was clear after further inquiries by John that the India team had already addressed many if not all of the concerns and much of the remaining work involved implementation. John volunteered to send some people over to help and I said OK. He had already been in touch with the London team and Mike Hicks (who I have asked to return to Houston). The last thing you need right now is confusion caused by a group saying we're from corporate and we're here to help. If you don't need any help or if the situation gets anything other than significantly better let me know. To: Steven J Kean/NA/Enron@Enron cc: Rebecca McDonald/Enron@EnronXGate James A Hughes/Enron@EnronXGate Subject: India Help Steve As you are well aware we are facing a lot of things happening fast in India. We are using several parts of your team and are very pleased with most. I want to mention a couple of areas HR and Security. 1. HR: I heard that some folks in Houston had raised concerns about the quality of the India HR team and their preparedness. The HR team is doing an outstanding job and I wanted you to hear that from me. Once we realized we had a major issue on our hand and I received clearance from Rebecca and Jim to bring some HR folks into the loop HR had someone on a plane within 20 hours of my first call. We have always had great HR support through Drew Lynch and Bob Sparger helping our team led by Sandip Malik and this time Scott Gilchrist has joined in and helped as well. But the two workhorses have been Bob and Sandip. Bob got on a plane immediately and came over and he and Sandip have been working around the clock so that we are much better prepared now than we were just a couple of days back. We really relied heavily on HR and Drew had his team there for us. 2. PR: top notch team of John Ambler and Johan Zaayman working with and supporting Jimmy Mogal on the ground. Johan and Jimmy have been a strong team on the ground and John has provided leadership and all coordination with Houston. Great efforts and productive work. 3. Security: This area has not worked as well and if you ever want feedback on our one-time experience with this group I will provide it. I don't have any idea who is in charge from Enron's perspective here. There are 2 groups headed this way. Mike Hicks will arrive Thursday night and Mike has informed us that he will be leading all security efforts. Jim Rountree is apparently travelling with Mike and Don Hawkins sent me an e-mail earlier today telling me that Don has instructed Jim that Jim is in charge of coordinating our security. John Brindle has sent me an e-mail saying that you have asked him to coordinate and help in the ongoing efforts and John is sending 3 people over arriving Saturday night. First we are very happy to have the help but I just hope that Mike Jim and John know which of the three are in charge. If you could just let me know who you want to be in charge we will coordinate with that person. On a side note the people who have really been helpful were brought in through Drew Lynch of Europe HR. They are Jim Roth and Dave Lawler both of whom work for John Sherriff. They had a great attitude were willing to work day and night and were planning on coming to coordinate until Mike decided he would come. At Mike's earlier suggestion we engaged Hill & Associates to help on security. Because I was having to meet with them 3 to 4 times per day I asked Jane Wilson to help coordinate all our security efforts. Jane has done a fantastic job in an impossibly short time frame. The tasks she has been overseeing include coordinating with Hill & Associates removing (in a lowkey yet rush manner) over 400 boxes of files and documents and getting them through customs and to Europe removing 2 container truck loads of files from the Dabhol site and getting them out of the country and overseeing a complete security check and file removal of all our electronic files from servers desktops and laptops. In addition she has coordinated security for all expats and families as well as worked with EOGIL expats and Anthony Duenner of EBS Asia. Again we appreciate all the help. Wade What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Weekly Notes Body:: We are discontinuing the executive car wash. You Steve and I should talk. From: Bill Donovan@ECT on 05/17/2001 03:29 PM To: Steven J Kean/NA/Enron@Enron Maureen McVicker/NA/Enron@Enron cc: Subject: Weekly Notes Steve - I will be taking this Friday the 18th off on vacation. Here are notes for your staff meeting. Buyer/Seller have executed Offer Letter on Falcon EX ($32750000 price). Aircraft goes to pre-purchase inspection this weekend. Close is no later than June 6th. All indications are that buyer is very motivated to complete the deal. Enron Center South (ECS) Project remains solidly on track. We are 10 weeks out on initial occupancy with Level 3 occupancy (EGM moves Aug. 3rd). Levels 4 (EIM ENW & Credit.Com) occupies two weeks later (Aug. 17). Level 5 (Power) occupies two weeks after (Aug. 31st - Labor Day weekend). Level 6 (Gas) occupies two weeks after (Sept. 14th). Level 7 (Executive) and the 1st floor public spaces occupies year end. Level 2 (Cafeteria) opens Nov. Found a Law firm interested in Azurix's present space in Three Allen Center (3 floors). Goal is cut deal and have them in by year end. Enron Broadband indicates an intent to remain on their present ECN floors (Levels 44 and 45) plus backfill balance of operations into Wholesale's vacated trading floors. This splits them into two elevator banks and becomes problematic for ETS - who wants continuous floors ECN Levels 39 through 46. We are seeking subtenants for Broadband's Portland office space. They plan to vacate the Riverplace building by Oct. Negotiating new food service contract with Sedexo Marriott to add ECS cafeteria. Total compensation will be based on 3% fee on gross revenue - only on individual sales of $2 or more (promote greater # of meals served) and bonus based on sharing of net operating income with Enron. Global Sourcing is participating with us in negotiations. Need to decide if Executive Car Care program is going to be continued (30 executives participate with employee paying $70 per month and business units subsidizing $275 per month). Decision needed because new Garage will require $60K in improvements to get set up for car washing. Present lease on remote car washing facility (@ $5k per month) expired and we are on month to month holdover. We are two weeks out to close on Beltway 8 land deal ($1.7 purchase price). Real estate being acquired for construction of new $18 mill. Data Center and Disaster Recovery Facility. Phillipe and I meet with Frevert next week to get approvals. - Bill What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request Confidential Information by FERC Body:: To All California Power Exchange Participants: Notice is hereby provided pursuant to Section 19.3.4 of the California Power Exchange Tariff that the staff of the Federal Energy Regulatory Commission (FERC) as part of its investigation of California markets has requested information that my be confidential under Section 19.3.2 of the Tariff. Such information consists of participant specific schedules and bids. The FERC staff has requested the California Power Exchange to provide such information no later than 24 business hours after the date of this notice. If you desire to assert a claim of privilege or confidentiality pursuant to FERC's regulations or other legal authority the California Power Exchange will include your written assertion of that claim together with its submittal to the FERC staff provided that it is timely received. Your written statement should be directed to FERC and delivered to: Karen Koyano California Power Exchange 1000 S. Fremont Avenue Building A-9 W Fifth Floor Alhambra CA 91801 626.537.3173 facsimile Information must be received no later than Tuesday September 12 2000 9:00 A.M. PDT to be included with any information delivered to the FERC staff. You are also free to take any other legal action you may deem appropriate in the circumstances of this investigation. Thank you. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Antics Oh, Behave!.htm Body:: Jeff =20 Today's LA Times editorial revived the Lockyer quote. It is remarkable (a= nd troubling for Enron) that Lockyer's political peers / rivals have not t= aken him to task for his outrageous remark nor have the major newspapers= . In Today's editorial the usually conservative LA Times refers to Locky= er as having boosted the rhetoric a notch. (I'd hate to witness two or = three notches.) =20 This lack of criticism could foreshadow a contagious attitude that powerfu= l Enron is in fact the one to blame (facts be damned). Given Enron's high= profile policy and fundraising ties to the Bush administration and Govern= or Gray Davis' war with President Bush and Texas energy companies there c= ould be more turbulence ahead. Fasten your seatbelts and be on the ready= . =20 Kevin 213-926-2626 =20 [IMAGE] [IMAGE][IMAGE] =09[IMAGE] [IMAGE]=09 [IMAGE] =09Home | Discussions | Print Edition | Archives | Site Map = | Home Delivery | Advertise | Feedback | Help [IMAGE]=09 =09[IMAGE]=09 [IMAGE] [IMAGE] [IMAGE] [IMAGE] News Politics Entertainment music = movies art TV restaurants [IMAGE] Business Travel Marketplace jo= bs homes cars rentals classifieds [IMAGE] Sports Commentary Shop= ping [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Editorials= Letters Op-Ed [IMAGE] [IMAGE] TOP STORIES * We Aren't That Despera= te * Energy Crisis as Political Payback * Hand-Held Cell Phones Dr= iving Don't Mix MORE [IMAGE] [IMAGE] [IMAGE] STORIES BY DATE FOR TH= IS SECTION 5/25 | 5/24 | 5/23 | 5/22 | 5/21 | 5/19 [IMAGE] = DAILY SECTIONS Front Page A Section California [IMAGE] Business = Sports Calendar [IMAGE] So. Cal. Living EditorialsLetters Op/Ed W= EEKLY SECTIONS Health Food [IMAGE] Tech Times [IMAGE] Highway 1 = SUNDAY SECTIONS Book Review Opinion Real Estate [IMAGE] Calendar Mag= azine Travel [IMAGE] TV Times Work Place [IMAGE] [IMAGE] [IMAGE] [= IMAGE] [IMAGE] [IMAGE] Marketplace Find a home car rental job = pet merchandise boat plane or RV classifieds Place an Ad [IMAG= E] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] L.A. Times Subscription Ser= vices Subscribe Change of Address Vacation Stops Suspend Delivery = College Discount Gift Subscriptions Mail Subscriptions FAQ [IMAG= E] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Print Ads from the Newspape= r See this week's ads [IMAGE] [IMAGE] [IMAGE] Print Edition Oran= ge County Valley Ventura County National Community Papers [IMAG= E] [IMAGE] [IMAGE] [IMAGE] Books Columnists Crossword Education = Food Health Highway Horoscope Lottery Magazine Obituaries Readi= ng by Real Estate Religion Science So.Cal. Living Special Report= s Sunday Opinion Tech Times Times Poll Traffic Weather Workplace SI= TE MAP [IMAGE] [IMAGE] [IMAGE] SHOP 'TIL YOUR LAPTOP DROPS [IMA= GE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Shopping [IMAGE] Search Prod= ucts Stores [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] = =09[IMAGE]=09[IMAGE] Friday May 25 2001 | [IMAGE]Print this story [IMAGE= ] [IMAGE] Energy Antics: Oh Behave! Admit it: The only comic re= lief in this energy crisis has been watching our leaders go at suppliers a= nd each other like pro wrestlers or Jerry Springer guests. In his St= ate of the State address last January Gov. Gray Davis accused the big pri= vate electric power generators of legalized highway robbery and threatened= to seize their plants if necessary. Then he really got angry calling the= m the biggest snakes in the world. This past week Atty. Gen. Bill Locky= er boosted the rhetoric a notch by declaring he would like to personally e= scort the chairman of Enron Corp. to an 8-by-10 cell that he could share = with a tattooed dude who says 'Hi my name is Spike honey.' Meanwhile = President Bush and Vice President Dick Cheney have blamed California for c= ausing its own problems with a harebrained deregulation scheme and mocke= d the state's power purchases and conservation programs. It's been fun. No= w it's time for our leaders to act like adults. Davis and Bush alwa= ys will have their political differences but the economies of both the st= ate and the nation are endangered by California's energy situation. These = leaders need to work together as cooperatively as possible starting next = week when Bush makes his first visit to California as president. Da= vis wrote Bush Wednesday offering to meet with him during his California v= isit. Bush spokesman Ari Fleischer said the president looks forward to dis= cussing energy and other issues. Good start. Let's hope the conversation i= s civil and that the civility spreads. No matter how much California= has been abused by the power companies and it absolutely has the state = still needs them to help solve the crisis caused by shortages of electric = power generation this year and next. Usually the biggest targets of offi= cial and public wrath are the investor-owned utilities such as Southern Ca= lifornia Edison and Pacific Gas & Electric Co. But not this time because = in the view of the state the utilities have been bled dry by the power ge= nerators' stratospheric prices. The state had to take over the purchase of= power when the generators refused to extend any more credit to Edison and= PG&E. Legal recourse should be pursued but the threatening rhetoric need= s to subside. State lawmakers are right to be upset with the White = House for refusing to use its authority to set reasonable temporary wholes= ale price controls. And Davis is justifiably upset with Bush and with Chen= ey who said the only solution was to build more power plants--ignoring th= e fact that the state is building 10 plants now with five more on the way= and that the only way to control wholesale power rates is for Washington= to cap them. If the state hadn't bought the power the generators w= ould have let the lights go out. Davis needs to deliver that message quie= tly and persuasively while Bush is in California. And Bush needs to liste= n respectfully like an adult. [IMAGE]Search the archives of the Los A= ngeles Times for similar stories. You will not be charged to look for stor= ies only to retrieve one. =09 News Politics Entertainment music movies art TV restaurants = [IMAGE] Business Travel Marketplace jobs homes cars rentals cla= ssifieds [IMAGE] Sports Commentary Shopping [IMAGE] =09[IMAGE]=09 = Copyright ? 2001 Los Angeles Times=09 Software Videos/DVD's Music and Other Free Stuff!!! =09 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: Ray's in the air today and he asked me to forward the agenda for tomorrow's call PLEASE MARK YOUR CALENDAR Date: Every Thursday Time: 7:30 am Pacific 9:30 am Central and 10:30 am Eastern time Number: 1-888-271-0949 Host Code: 661877 (for Ray only) Participant Code: 936022 (for everyone else) The table of the on-going FERC issues and proceedings is available to all team members on the O drive. Please feel free to revise/add to/ update this table as appropriate. Proposed agenda for tomorrow (Thursday) : GAS Any Items? ELECTRICITY Report on the 24-25 Sept meeting on CAISO operational issues FERC's new RTO iniatives: RTO West and DSTAR married California to heal its wounds but be audited nonetheless RTO Week in DC coming up ICAP in the West? Information req's NOPR CA and PAC NW refund proceeding status Please feel free to communicate any additional agenda items to the group . What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Enron Europe Governtal & Regulatory Affairs Organization Announcement Body:: I agree with Mark's changes and I think the memo is good to go. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Transredes spill Body:: Do we have someone who works for us now who was at Transredes when the government owned it and could help us do a comparison between our respective environmental records? It seems to me that even though we are having our share of problems we have probably had fewer problems than the government did and have probably been more responsive and thorough in our clean up efforts. Obviously we would need to be judicious about how we used such information (we don't want to aggravate the government) but having such an analysis may be helpful in showing the progress made and in discouraging overly punitive action by the government. What do you think? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Executive Committee Recommendation - VP Candidate - Rick Fehl Body:: OK by me. Ken Rice@ENRON COMMUNICATIONS 05/01/2001 03:48 PM To: Cliff Baxter/HOU/ECT Rick Buy/HOU/ECT Richard Causey/Corp/Enron@Enron James Derrick/Corp/Enron Andrew S Fastow/HOU/ECT Ben Glisan/HOU/ECT@ECT Steven J Kean/NA/Enron@ENRON Mark Koenig/Corp/Enron@ENRON Kenneth Lay/Corp/Enron@ENRON Mark Metts/NA/Enron Cindy Olson/Corp/Enron@ENRON Lou L Pai/HOU/EES@EES Jeffrey Sherrick/Corp/Enron Jeff Skilling/Corp/Enron@Enron Philippe A Bibi/HOU/ECT Raymond Bowen/HOU/ECT Michael R Brown/LON/ECT@ECT Wade Mark Frevert/NA/Enron James A Hughes/ENRON_DEVELOPMENT Louise Kitchen/HOU/ECT@ECT John J Lavorato/Corp/Enron Mike McConnell/HOU/ECT@ECT Rebecca McDonald/ENRON_DEVELOPMENT Jeffrey McMahon/HOU/ECT Greg Piper/Corp/Enron Jeffrey A Shankman/HOU/ECT John Sherriff/LON/ECT@ECT Greg Whalley/HOU/ECT@ECT Jeremy Blachman/HOU/EES@EES Harold G Buchanan/HOU/EES@EES David W Delainey/HOU/EES@EES Janet R Dietrich/HOU/EES@EES Dan Leff/HOU/EES@EES Mark S Muller/HOU/EES@EES Matthew Scrimshaw/LON/ECT@ECT Marty Sunde/HOU/EES@EES Thomas E White/HOU/EES@EES David Cox/Enron Communications@Enron Communications Steve Elliott/Enron Communications@Enron Communications Jim Fallon/Enron Communications@Enron Communications Kevin Hannon/Enron Communications@Enron Communications Rod Hayslett/FGT/Enron Stanley Horton/Corp/Enron@ENRON Danny McCarty/ET&S/Enron@Enron cc: Carol Ann Brown/Enron Communications@Enron Communications Dorothy Dalton/Enron Communications@Enron Communications Subject: Executive Committee Recommendation - VP Candidate - Rick Fehl Executive Committee: We would like to pursue an offer to Rick Fehl prior to the next Executive Committee meeting on May 7 2001. Please forward your comments or questions as soon as possible. You will find attached the recommendation letter and his resume. Regards Ken Rice & Kevin Hannon What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EES Staff Meeting, in 791 Body:: houston Bryson? 3-6424 -- Peggy Menchaca Kathleen Leslie Lawner - gas choice Fumo3 (48111220) Peco 15 ( 39235 Lauren Cox 9416377899 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Security question Body:: Dear guys Having been out of the office for a couple of days I've found myself the victim of theft (again). This time my desk drawer key has been stolen from its hiding place under my telephone. I *always* lock my drawers and keep the key in the same place but on arriving in the office today I found the drawers unlocked and the key missing. Although there's nothing sensitive on or around my desk I'm concerned about the security implications of someone sniffing around the office in this manner. I also found the papers on my desk extensively reshuffled last week. Last year in our old office I had my only two real options books stolen from among the many and varied books on my desk. That couldn't have been a random theft and I fear this isn't either. I can't understand who'd be so interested in a Research guy's belongings! Can we ask security to check their surveillance footage for any suspicious activity around my desk? Cheers Steve What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: IEP in the News, and other headlines Body:: San Jose Mercury News April 19 2001 Thursday SJ-POWER 593 words ????Testimony Indicates California Electricity Market Was Troubled in 1998 By ????Brandon Bailey (Quotes Smutny on behalf of IEP) The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? 9:55 AM Eastern Time State and Regional 930 words Developments in ????California's energy crisis By The Associated Press (Quotes Smutny on behalf of IEP) The Associated Press State & Local Wire April 19 2001 Thursday BC cycle ???? 9:32 AM Eastern Time State and Regional 820 words Legislators probe ????possible power natural gas collusion By DON THOMPSON Associated Press ????Writer SACRAMENTO (Quotes Smutny on behalf of IEP) The Associated Press State & Local Wire April 18 2001 Wednesday BC ????cycle State and Regional 833 words Legislators probe possible power ????natural gas collusion By DON THOMPSON Associated Press Writer SACRAMENTO ???(Quotes Smutny on behalf of IEP) The Associated Press State & Local Wire April 18 2001 Wednesday BC ????cycle State and Regional 841 words Developments in California's energy ????crisis By The Associated Press (Quotes Smutny on behalf of IEP) Power bloc blasts seizure idea Producers say talk of bold action fuels crisis ???????By Steve Geissinger SACRAMENTO BUREAU ?-- Oakland Tribune (Quotes Smutny on behalf of IEP) Copley News Service April 19 2001 Thursday State and regional 780 ????words Windfall-profits tax gets Davis' backing Bill Ainsworth SACRAMENTO Los Angeles Times April 19 2001 Thursday Home Edition Page 3 772 ????words CAPITOL JOURNAL ?CALIFORNIA AND THE WEST ??Price Caps Don't Fit in ????Cheney's Head for Figures GEORGE SKELTON SACRAMENTO Los Angeles Times April 19 2001 Thursday Home Edition Page 3 1373 ????words CALIFORNIA AND THE WEST ??DAVIS BACKS SILICON VALLEY POWER PROJECT ????ENERGY: GOVERNOR URGES QUICK APPROVAL OF SAN JOSE PLANT DESPITE OPPOSITION ????BY CITY AND A POWERFUL FIRM. JENIFER WARREN and TERENCE MONMANEY TIMES ????STAFF WRITERS SACRAMENTO The Orange County Register April 19 2001 Thursday STATE AND REGIONAL ????NEWS K7970 275 words Ex-energy chief leery of state buying power lines ????By Kate Berry The San Francisco Chronicle APRIL 19 2001 THURSDAY FINAL EDITION ????NEWS Pg. A18 585 words Alameda public utility rents four backup ????generators ???Extra electricity will be used during summer rolling ????blackouts Matthew Yi Alameda The San Francisco Chronicle APRIL 19 2001 THURSDAY FINAL EDITION ????NEWS Pg. A3 845 words Davis' gouging claims disputed ???Officials say ????no link between PG&E bankruptcy high prices David Lazarus The San Francisco Chronicle APRIL 19 2001 THURSDAY FINAL EDITION ????NEWS Pg. A3 888 words Davis backs San Jose power plant ???He also ????acknowledges bailout for Edison will be uphill fight Lynda Gledhill ????Sacramento The Vancouver Sun April 19 2001 Thursday 731 words B.C. Hydro's credit ????to California firms exceeded 1999 guidelines David Baines The Associated Press State & Local Wire April 18 2001 Wednesday BC ????cycle Business News 348 words Williams again target of overcharging ????allegations from federal regulators TULSA Okla. The Associated Press State & Local Wire April 18 2001 Wednesday BC ????cycle State and Regional 332 words Governor congressman to fight ????proposals for national power deregulation policy By MARGERY BECK ????Associated Press Writer LINCOLN Neb. San Jose Mercury News April 18 2001 Wednesday SJ-POWER-PLANT 1038 ????words California Governor May Back Energy Firm's Proposed Power Plant Scripps Howard News Service April 18 2001 Wednesday DOMESTIC NEWS 588 ????words Davis says Edison agreement may need altering EMILY BAZAR and KEVIN ????YAMAMURA SACRAMENTO Calif. San Jose Mercury News April 19 2001 Thursday KR-ACC-NO: SJ-POWER LENGTH: 593 words HEADLINE: Testimony Indicates California Electricity Market Was Troubled in 1998 BYLINE: By Brandon Bailey BODY: ??SACRAMENTO Calif.--California's electricity market was showing signs of trouble as far back as 1998 the year that it was officially opened to competition members of a special legislative investigating committee were told Wednesday. ??Abnormal price spikes -- far higher than what should have occurred in a competitive market -- were showing up in August 1998 the committee was told by Frank Wolak a Stanford economist and top advisor to the California Independent System Operator which runs the state's transmission grid. ??Appearing on the first day of hearings called by a state Senate select committee to investigate alleged wholesale energy price manipulation Wolak testified that the ISO's economic advisors repeatedly found signs that power suppliers were able to influence prices over the last three years -- even before wholesale prices soared skyhigh last summer. ??By controlling even a relatively small portion of power supply just enough to make a difference in whether the state could meet consumers' needs Wolak said generators have been able to charge prices far higher than their costs. ??All told the ISO has estimated power suppliers collected more than $ 6 billion in unjustified profits last year. ??In his opinion Wolak added that violates the terms by which federal regulators allowed the suppliers to enter the state's newly deregulated market when it opened in 1998. ??The ISO is now filing petitions with the Federal Energy Regulatory Commission asking that agency to revoke the generators' right to charge unregulated prices. ??But Wolak repeatedly told the committee that he had no evidence that the suppliers acted in collusion or that they had violated any federal anti-trust laws. ??When state Senator Joe Dunn D-Garden Grove pressed him on the point Wolak insisted I can't say yes I can't say no. There's a lot of things that certainly look puzzling. It's hard without further information and analysis to say definitively but there's lots of things to seem to be worth looking into. ??Dunn a former consumer attorney is leading the Legislature's efforts to answer a question that a host of other state and federal officials have also posed: have California's electricity prices been the result of any illegal or unethical acts? ??Power suppliers and their representatives have repeatedly said the answer is no. They say their prices are the result of short supplies and natural market swings. ??Eleven investigations into California's electricity market have been conducted or are currently under way said a statement issued Wednesday by Jan Smutny-Jones executive director of the Independent Energy Producers Association. Not one has found or proven any wrongdoing by generators. ??Dunn however said Wednesday's testimony was only the start of what he promised would be a vigorous investigation. He said the committee has already asked several power companies for records and other information and he hinted that subpoenas may be issued in the coming weeks. ??We will try to figure out how to stop these high prices if they are unjustified Dunn said at the beginning of the hearing. ??We're not going to be looking for ways to finance these payments he added. The state is now paying $ 70 million a day to buy power for California consumers after major utilities wracked up billions in debts while buying power on the open market in recent months. ??----- ??To see more of the San Jose Mercury News or to subscribe to the newspaper go to http://www.sjmercury.com JOURNAL-CODE: SJ LOAD-DATE: April 19 2001 of 5 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 930 words HEADLINE: Developments in California's energy crisis BYLINE: By The Associated Press BODY: ??Developments in California's energy crisis: ??THURSDAY: ??- The state remains free of power alerts as reserves stay above 7 percent. ??- Gov. Gray Davis meets with 25 members of the California congressional delegation at the Los Angeles International Airport to discuss the state's power crisis. ??- An Assembly committee continues hearings on the natural gas supply and possible price manipulation. ??-The Public Utilities Commission meets in San Francisco to decide whether to investigate if a key bloc of independent generators are purposely keeping their plants offline. ??WEDNESDAY: ??- Unchecked free-market forces drove up the price of natural gas to Southern California Edison by about $750 million over the last year an industry consultant tells the Assembly Electricity Oversight Subcommittee. ??Meanwhile the Senate's Select Committee to Investigate Price Manipulation of the Wholesale Energy Market begins investigating whether electric generators artificially inflated power prices. ??An industry spokesman predicts the investigations will uncover nothing illegal. ??- The state offers financial backing to Houston-based Dynegy which worried it would not be paid for power generated at its plants in California. Dynegy agrees to sell 300 megawatts of power from 17 small turbine generators in Carlsbad after receiving an offer from the California Department of Water Resources. ??- Gov. Gray Davis urges state regulators to approve the construction of a controversial 600-megawatt power plant in south San Jose to provide electricity to roughly 450000 homes in the Silicon Valley. ??- The Democratic governor lobbies Senate Democrats to support his plan to pay $2.7 billion for the transmission lines owned by Southern California Edison. ??State spending on electricity has jumped by more than 50 percent since Pacific Gas and Electric Corp. declared bankruptcy April 6 thanks in part of surcharges tacked on by power generators worried they won't be repaid Davis said. ??- The Senate Appropriations Committee sends the full Senate a bill creating a public power authority that would loan out up to $5 billion to build or buy power plants that would be required to sell electricity to consumers at low rates. ??- An Assembly committee advances a bill ending the exemption under which utility lobbyists do not have to follow the same reporting requirements as do other lobbyists. The bill now goes to the Assembly Appropriations Committee. ??- A Pacific Gas and Electric Corp. shareholder sues the company claiming it misled shareholders by forecasting annual profits for two quarters last year when the suit says the company knew it was incurring losses. ??-Public Utilities Commission President Loretta Lynch issues a statement late Wednesday saying inaction by the Federal Energy Regulatory Commission forced Southern Caifornia Edison Co. to take a large write-off of debt. The company should not have to shoulder these liabilities and neither should its customers Lynch says. ??- Edison International's stock closes at $11.40 down 48 cents while stock in PG&E's parent closes up 14 cents at $9.04. ??- The state remains free of power alerts as reserves stay above 7 percent. ??WHAT'S NEXT: ??- The Assembly's Energy Oversight Subcommittee plans to resume hearings Thursday in its inquiry into California's highest-in-the-nation natural gas prices with testimony from gas companies. ??- Davis' representatives continue negotiating with Sempra the parent company of San Diego Gas and Electric Co. to buy the utility's transmission lines. Davis says he expects to have an agreement within two weeks. ??- The state Public Utilities Commission will decide Thursday whether to investigate why a key block of power generators is staying off-line despite regulators' order last month that they start getting paid by the state's utilities. Independent Energy Producers Executive Director Jan Smutny-Jones says the generators can't afford to operate because they are still owed more than a billion dollars and because the PUC's rates don't cover their operating costs. ??PUC President Loretta Lynch also wants the commission to decide Thursday to investigate whether PG&E's April 6 bankruptcy protection filing is enough of a threat to the PUC's regulatory authority to prompt more PUC involvement in the bankruptcy proceedings. ??THE PROBLEM: ??High demand high wholesale energy costs transmission glitches and a tight supply worsened by scarce hydroelectric power in the Northwest and maintenance at aging California power plants are all factors in California's electricity crisis. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Electricity and natural gas suppliers scared off by the two companies' poor credit ratings are refusing to sell to them leading the state in January to start buying power for the utilities' nearly 9 million residential and business customers. The state is also buying power for a third investor-owned utility San Diego Gas & Electric which is in better financial shape than much larger Edison and PG&E but also struggling with high wholesale power costs. ??The Public Utilities Commission has raised rates up to 46 percent to help finance the state's multibillion-dollar power-buying. LOAD-DATE: April 19 2001 of 5 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19 2001 Thursday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 820 words HEADLINE: Legislators probe possible power natural gas collusion BYLINE: By DON THOMPSON Associated Press Writer DATELINE: SACRAMENTO BODY: ??Southern California Edison was charged about $750 million more this year for natural gas because of unchecked free-market forces an industry consultant testified. ??Paul Carpenter told the Assembly Electricity Oversight Subcommittee on Wednesday the price spikes came after the El Paso Natural Gas Co. contracted first with Dynegy and later with its own marketing affiliate El Paso Merchant Energy to control the pipeline capacity. ??Officials with El Paso and other natural gas suppliers are expected to testify Thursday that they did not illegally manipulate the market. ??The California Public Utilities Commission estimated a year ago that overcharges by the companies that control natural gas flow drove up prices by $ 100 million a year to California gas and electricity customers. ??But PUC attorney Harvey Morris said that was before last summer's price spikes which he blamed on natural gas suppliers using a monopoly to game the system. ??It's way worse than we could possibly have imagined Morris said after testifying before the subcommittee. It's obviously way higher than $100 million. ??Natural gas rates at the California border generally tracked national prices until November when they spiked as high as 11 times higher than the price of natural gas elsewhere in the nation Carpenter said. ??I have never seen gas prices like this anywhere in the world said Carpenter who has been studying the energy market for 20 years for Cambridge Mass.-based consultant The Brattle Group. The Brattle Group was hired by Edison to study the natural gas market. ??The committee is one of two legislative committees exploring whether illegal market manipulation in the electricity and natural gas markets has driven up California's energy costs. ??This is a market that is plagued by the exercise of market power Frank Wolak chairman of the California Independent System Operator's Market Surveillance Committee told the Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market. The ISO runs the state's power grid. ??However there is no law against me saying 'I'm not going to sell to you' Wolak said. Market manipulation only becomes illegal when there is collusion Wolak said and such evidence is hard to find. ??Electricity generators and natural gas suppliers say a severe supply and demand imbalance - not market manipulation - has led to higher prices. ??Everybody's busy doing investigations. They're not interested in solving the problem said Independent Energy Producers Executive Director Jan Smutny-Jones. ??Investigations are wasting everybody's time Smutny-Jones said adding that previous probes and lawsuits have uncovered no wrongdoing. He said the state's power problems came because state regulators denied utilities the chance to sign long-term energy contracts when they had the chance. ??People have been playing by the rules Smutny-Jones said. ??But the Senate committee's first witnesses are ISO officials who authored studies that claim the state paid more than $6 billion too much for power last year. ??Committee chair Joseph Dunn D-Garden Grove also has slated state Auditor Elaine Howell who last month blamed buyers and sellers for skyrocketing electricity costs. Dunn also has scheduled future testimony from state federal academic and private investigators studying the power market. ??He invited five major generators to attend the committee's second hearing next week. All five - Reliant Dynegy Williams Energy Duke Energy and Mirant - say they are eager to cooperate and clear their names Dunn said. ??Dunn asked the five for a total of 86 specific documents. If the companies feel they cannot provide documents because of legal or confidentiality concerns Dunn said he will subpoena them. ??Smutny-Jones said investigators appear to be growing desperate to blame the state's natural gas and electricity price hikes on illegal market manipulation instead of natural market forces. ??He cited Attorney General Bill Lockyer's announcement last week that any informant who helped prove wrongdoing would be entitled to a percentage of the state's recovery he estimated could range from $50 million to hundreds of millions of dollars. ??If the state's offering a $50 million reward they haven't found anything Smutny-Jones said. I don't think you're going to find the fact that anybody did anything criminal here. ??Assemblywoman Jenny Oropeza D-Long Beach said she believes otherwise after Wednesday's testimony: I think it is very clear there was some price manipulation going on. ??But Assemblyman John Campbell R-Irvine isn't sure there was anything illegal. ??There clearly are market forces at work that's evident Campbell said. Whether you make the jump to market manipulation ... I haven't seen conclusive evidence that leads me to make that jump. LOAD-DATE: April 19 2001 of 5 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ?????????????????????April 18 2001 Wednesday BC cycle SECTION: State and Regional LENGTH: 833 words HEADLINE: Legislators probe possible power natural gas collusion BYLINE: By DON THOMPSON Associated Press Writer DATELINE: SACRAMENTO BODY: ??Unchecked free-market forces drove up the price of natural gas to Southern California Edison by about $750 million over the last year an industry consultant testified Wednesday. ??Paul Carpenter told the Assembly Electricity Oversight Subcommittee the price spikes came after the El Paso Natural Gas Co. contracted first with Dynegy and later with its own marketing affiliate El Paso Merchant Energy to control the pipeline capacity. ??The California Public Utilities Commission estimated a year ago that overcharges by the companies that control natural gas flow drove up prices by $ 100 million a year to California gas and electricity customers. ??But PUC attorney Harvey Morris said that was before last summer's price spikes which he blamed on natural gas suppliers using a monopoly to game the system. ??It's way worse than we could possibly have imagined Morris said after testifying before the subcommittee. It's obviously way higher than $100 million. ??Natural gas rates at the California border generally tracked national prices until November when they spiked as high as 11 times higher than the price of natural gas elsewhere in the nation Carpenter said. ??I have never seen gas prices like this anywhere in the world said Carpenter who has been studying the energy market for 20 years for Cambridge Mass.-based consultant The Brattle Group. The Brattle Group was hired by Edison to study the natural gas market. ??Officials with El Paso and other natural gas suppliers have denied illegally manipulating the market. They are scheduled to testify Thursday. El Paso officials did not return telephone calls for comment Wednesday. ??The committee is one of two legislative committees exploring whether illegal market manipulation in the electricity and natural gas markets has driven up California's energy costs. ??This is a market that is plagued by the exercise of market power Frank Wolak chairman of the California Independent System Operator's Market Surveillance Committee told the Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market. The ISO runs the state's power grid. ??However there is no law against me saying 'I'm not going to sell to you' Wolak said. Market manipulation only becomes illegal when there is collusion Wolak said and such evidence is hard to find. ??Electricity generators and natural gas suppliers say a severe supply and demand imbalance - not market manipulation - has led to higher prices. ??Everybody's busy doing investigations. They're not interested in solving the problem said Independent Energy Producers Executive Director Jan Smutny-Jones. ??Investigations are wasting everybody's time Smutny-Jones said adding that previous probes and lawsuits have uncovered no wrongdoing. He said the state's power problems came because state regulators denied utilities the chance to sign long-term energy contracts when they had the chance. ??People have been playing by the rules Smutny-Jones said. ??But the Senate committee's first witnesses are ISO officials who authored studies that claim the state paid more than $6 billion too much for power last year. ??Committee chair Joseph Dunn D-Garden Grove also has slated state Auditor Elaine Howell who last month blamed buyers and sellers for skyrocketing electricity costs. Dunn also has scheduled future testimony from state federal academic and private investigators studying the power market. ??He invited five major generators to attend the committee's second hearing next week. All five - Reliant Dynegy Williams Energy Duke Energy and Mirant - say they are eager to cooperate and clear their names Dunn said. ??Dunn asked the five for a total of 86 specific documents. If the companies feel they cannot provide documents because of legal or confidentiality concerns Dunn said he will subpoena them. ??Smutny-Jones said investigators appear to be growing desperate to blame the state's natural gas and electricity price hikes on illegal market manipulation instead of natural market forces. ??He cited Attorney General Bill Lockyer's announcement last week that any informant who helped prove wrongdoing would be entitled to a percentage of the state's recovery he estimated could range from $50 million to hundreds of millions of dollars. ??If the state's offering a $50 million reward they haven't found anything Smutny-Jones said. I don't think you're going to find the fact that anybody did anything criminal here. ??Assemblywoman Jenny Oropeza D-Long Beach said she believes otherwise after Wednesday's testimony: I think it is very clear there was some price manipulation going on. ??But Assemblyman John Campbell R-Irvine isn't sure there was anything illegal. ??There clearly are market forces at work that's evident Campbell said. Whether you make the jump to market manipulation ... I haven't seen conclusive evidence that leads me to make that jump. LOAD-DATE: April 19 2001 of 5 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ?????????????????????April 18 2001 Wednesday BC cycle SECTION: State and Regional LENGTH: 841 words HEADLINE: Developments in California's energy crisis BYLINE: By The Associated Press BODY: ??Developments in California's energy crisis: ??WEDNESDAY: ??- Unchecked free-market forces drove up the price of natural gas to Southern California Edison by about $750 million over the last year an industry consultant tells the Assembly Electricity Oversight Subcommittee. ??Meanwhile the Senate's Select Committee to Investigate Price Manipulation of the Wholesale Energy Market begins investigating whether electric generators artificially inflated power prices. ??An industry spokesman predicts the investigations will uncover nothing illegal. ??- The state offers financial backing to Houston-based Dynegy which worried it would not be paid for power generated at its plants in California. Dynegy agrees to sell 300 megawatts of power from 17 small turbine generators in Carlsbad after receiving an offer from the California Department of Water Resources. ??- Gov. Gray Davis urges state regulators to approve the construction of a controversial 600-megawatt power plant in south San Jose to provide electricity to roughly 450000 homes in the Silicon Valley. ??- The Democratic governor lobbies Senate Democrats to support his plan to pay $2.7 billion for the transmission lines owned by Southern California Edison. ??State spending on electricity has jumped by more than 50 percent since Pacific Gas and Electric Corp. declared bankruptcy April 6 thanks in part of surcharges tacked on by power generators worried they won't be repaid Davis said. ??- The Senate Appropriations Committee sends the full Senate a bill creating a public power authority that would loan out up to $5 billion to build or buy power plants that would be required to sell electricity to consumers at low rates. ??- An Assembly committee advances a bill ending the exemption under which utility lobbyists do not have to follow the same reporting requirements as do other lobbyists. The bill now goes to the Assembly Appropriations Committee. ??- A Pacific Gas and Electric Corp. shareholder sues the company claiming it misled shareholders by forecasting annual profits for two quarters last year when the suit says the company knew it was incurring losses. ??-Public Utilities Commission President Loretta Lynch issues a statement late Wednesday saying inaction by the Federal Energy Regulatory Commission forced Southern Caifornia Edison Co. to take a large write-off of debt. The company should not have to shoulder these liabilities and neither should its customers Lynch says. ??- Edison International's stock closes at $11.40 down 48 cents while stock in PG&E's parent closes up 14 cents at $9.04. ??- The state remains free of power alerts as reserves stay above 7 percent. ??WHAT'S NEXT: ??- The Assembly's Energy Oversight Subcommittee plans to resume hearings Thursday in its inquiry into California's highest-in-the-nation natural gas prices with testimony from gas companies. ??- Davis' representatives continue negotiating with Sempra the parent company of San Diego Gas and Electric Co. to buy the utility's transmission lines. Davis says he expects to have an agreement within two weeks. ??- The state Public Utilities Commission will decide Thursday whether to investigate why a key block of power generators is staying off-line despite regulators' order last month that they start getting paid by the state's utilities. Independent Energy Producers Executive Director Jan Smutny-Jones says the generators can't afford to operate because they are still owed more than a billion dollars and because the PUC's rates don't cover their operating costs. ??PUC President Loretta Lynch also wants the commission to decide Thursday to investigate whether PG&E's April 6 bankruptcy protection filing is enough of a threat to the PUC's regulatory authority to prompt more PUC involvement in the bankruptcy proceedings. ??THE PROBLEM: ??High demand high wholesale energy costs transmission glitches and a tight supply worsened by scarce hydroelectric power in the Northwest and maintenance at aging California power plants are all factors in California's electricity crisis. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E saying it hasn't received the help it needs from regulators or state lawmakers filed for federal bankruptcy protection April 6. ??Electricity and natural gas suppliers scared off by the two companies' poor credit ratings are refusing to sell to them leading the state in January to start buying power for the utilities' nearly 9 million residential and business customers. The state is also buying power for a third investor-owned utility San Diego Gas & Electric which is in better financial shape than much larger Edison and PG&E but also struggling with high wholesale power costs. ??The Public Utilities Commission has raised rates up to 46 percent to help finance the state's multibillion-dollar power-buying. LOAD-DATE: April 19 2001 Power bloc blasts seizure idea Producers say talk of bold action fuels crisis By Steve Geissinger SACRAMENTO BUREAU ?-- Oakland Tribune SACRAMENTO -- Outraged by a report in The Oakland Tribune that some lawmakers asked the governor to seize high-priced power contracts a key industry group Tuesday warned the Davis administration and Legislature that such action would worsen the energy crisis. We're publicly saying . . . this kind of rhetoric will have dire consequences on both the reliability and cost of power in California for years to come said Jan Smutny-Jones executive director of the Independent Energy Producers Association. It is the kind of rhetoric one would expect in Indonesia or the Philippines not the sixth largest economy on the planet he said in a teleconference. At the same time Davis administration officials confirmed that seizing contracts of allegedly profiteering brokers is the most likely last-ditch move if options continue to narrow ahead of the previously discussed concepts of seizing California power plants owned by out-of-state firms or passing a windfall profits tax. Davis spokesman Steve Maviglio pointed out the governor already seized power contracts on which California's investor-owned utilities were defaulting in early February. The state trying to buy its way out of the energy crisis with no clear end in sight lost a substantial measure of control over electricity prices and supplies to the courts with the recent bankruptcy filing by the Pacific Gas and Electric Co. Gov. Gray Davis a Democrat employed hard-sell tactics Tuesday in an effort to convince reluctant Democrats that their failure to embrace his plan to financially rescue teetering Southern California Edison could plunge that utility into bankruptcy as well. While most Republicans are flatly opposed to the plan as misguided Democrats who hold a majority in the Legislature worry it's a public bailout of an investor-owned utility and would hand the state control over only Edison's south-state piece of the strategic high-voltage transmission grid in California. Soaring wholesale power costs have financially shattered utilities forcing the state into runaway multibillion-dollar spending that helps keep the lights on but threatens the state budget. The manager of the state's power grid has accused generators and marketers of overcharging Californians more than $6 billion in recent months. Assembly Speaker Robert Hertzberg D-Van Nuys said Monday that members of both legislative houses were interested in seizure of California power plants' contracts with brokers who sell to customers within or outside the state. Sen. Don Perata D-Oakland an outspoken critic of the Davis administration's handling of the crisis said some lawmakers had asked the governor to use emergency or eminent domain powers to seize the overpriced contracts and were awaiting Davis' answer this week. Supporters of the move said seizure would allow the state to control where the power is sold and decrease price markups by eliminating the middleman. But myriad questions remain unanswered including regulatory and interstate commerce issues as well as any state reimbursement of the brokers. Any move to seize power contracts would be overturned by the courts said Gary Ackerman executive director of the Western Power Trading Forum. Instead of trying to do what's legally within their reach they go to extreme measures that are on their very face unlawful and unconstitutional Ackerman said. Moreover industry officials said seizure would not only chill industry investment in California's power system and lead to higher power costs but would be ironic since California has shunned lower-cost long-term contracts industry officials said. It would create a very unstable political regulatory environment Smutny-Jones said. It would have extremely adverse consequences for California in the long term. Even so the talk has worried the industry. Smutny-Jones said his clients are very very troubled by this sudden turn in rhetoric. I assume when senior members of the Legislature make pronouncements about potentially seizing contracts it's designed to get our attention and we obviously take those things seriously he said. The Independent Energy Producers group is in the process of contacting the Davis administration and lawmakers said Smutny-Jones. You'll hear more about this. Copyright 2001 Copley News Service Copley News Service April 19 2001 Thursday SECTION: State and regional LENGTH: 780 words HEADLINE: Windfall-profits tax gets Davis' backing BYLINE: Bill Ainsworth DATELINE: SACRAMENTO BODY: ??Federal regulators' failure to stop what they described as anti-competitive practices in the natural-gas industry added $750 million to Southern California Edison's cost of electricity a consultant estimated yesterday. ??The consultant Paul Carpenter of the Brattle Group spoke to an Assembly subcommittee investigating why California pays the highest natural-gas prices in the nation. Natural gas is a critical part of the electricity crisis because most of the state's generating plants run on natural gas. ??Natural-gas prices have soared throughout the nation but the bench mark price paid at California's border has been double that paid at other bench mark locations throughout the nation for months according to figures released by the Assembly Subcommittee on Energy Oversight. ??Next week Carpenter plans to testify at hearings in Washington D.C. on behalf of Southern California Edison and the California Public Utilities Commission which are asking federal regulators to intervene. ??The giant utility and the state regulatory body contend that a sweetheart deal between El Paso Natural Gas and El Paso Merchant Energy gave the sister companies enough market power to artificially raise the price of natural gas that flows into Southern California from Texas. ??El Paso owns the major pipeline bringing natural gas from fields in New Mexico and Texas to Southern California. El Paso Merchant Energy is an unregulated sister company. ??Carpenter called the prices paid in Southern California ''simply unprecedented'' in the United States. He estimated that the sister companies manipulated the market enough to add $2.60 to the price of a million British thermal units of gas. ??In addition he said El Paso Merchant Energy owns part of 20 smaller power plants ''qualifying facilities'' that get paid based on the price of natural gas in California. The higher natural-gas prices increase the company's revenues Carpenter said. ??El Paso company officials are expected to testify in front of the Assembly subcommittee today but in proceedings before the federal regulators they have denied any sweetheart deal. ??In a report they commissioned the company blamed the higher natural-gas prices in Southern California on increased demand and constraints on pipeline capacity. ??Gov. Gray Davis meanwhile gave his strongest endorsement yet to a windfall-profits tax on generators as a Senate committee chaired by Joseph Dunn D-Laguna Niguel began a series of hearings to probe possible price gouging by generators. ??''I believe the Legislature would be well within its prerogative to insist that generators receive an appropriate reduction whether it's 20 percent or any other number the Legislature hit upon'' Davis said. ??Senate Democrats Davis said will form a special committee to help work on his plan for the state purchase of the transmission system of Southern California Edison for $2.76 billion in exchange for state aid in paying off the utilities' debt. ??The governor said he told Senate Democrats a number of whom are skeptical of the plan that Edison's parent firm has agreed to back a $3 billion upgrade of the neighborhood distribution system retained by Edison and to return a $400 million tax refund to the utility. ??At the natural-gas hearing yesterday state officials said that after El Paso Merchant Energy bought a significant part of the pipeline capacity from its sister company it withheld natural gas to drive prices up. ??''Marketers have gamed the system and figured out how to hoard capacity and undermine competition'' said Harvey Morris an attorney for the California Public Utilities Commission. ??State regulators want the Federal Energy Regulatory Commission which regulates natural gas to open the market to more competitors. ??But the commission has repeatedly rejected similar complaints in the past. On March 28 FERC ruled that the affiliates did not arrange a sweetheart deal. ??''The fact that El Paso Merchant controls a large volume of capacity does not in and of itself render the El Paso contracts unjust unreasonable or unduly discriminatory'' FERC ruled. ??In other cases involving natural gas federal regulators acknowledged that certain contract provisions allowed anti-competitive behavior but they approved those contracts anyway. ??Lawmakers said they were puzzled by the federal regulators' lack of action. ??''It baffles me that we've found the problem anti-competitive behavior and market gaming but there's no cure because federal regulators won't take action'' said Assemblyman Juan Vargas D-San Diego. Staff writer Ed Mendel contributed to this report. LOAD-DATE: April 19 2001 of 63 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 19 2001 Thursday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 772 words HEADLINE: CAPITOL JOURNAL CALIFORNIA AND THE WEST Price Caps Don't Fit in Cheney's Head for Figures BYLINE: GEORGE SKELTON DATELINE: SACRAMENTO BODY: ??Want price caps on wholesale electricity to staunch the bleeding of billions from California? Not going to happen Vice President Dick Cheney insists. Don't waste your energy thinking about it. ??Frankly California is looked on by many folks as a classic example of the kinds of problems that arise when you do use price caps Cheney said in a telephone interview Wednesday. ??The vice president was referring to another type of price cap--the infamous state cap on consumer rates that has left the private utilities billions short of enough revenue to pay their gouging wholesalers. What political leaders in California and the Northwest are pleading for from the Federal Energy Regulatory Commission is a regional cap on wholesale prices. ??Early last year a megawatt-hour was selling wholesale in California for $ 30. By year's end it had risen to an average $ 300 according to state officials. At peak prices have soared to $ 1500. Meanwhile demand increased last year by less than 4%. In fact demand last month was 9% less than in March 2000. ??This is the sorry news for ratepayers/ taxpayers: Californians paid $ 7.4 billion for electricity in 1999. This year the tab--without price caps--is projected at $ 70 billion. Gov. Gray Davis disclosed Tuesday that his administration has been shelling out $ 73 million a day to buy electricity for the pauper utilities. ??The profits of power producers--many of them Texans and Bush backers--have risen 400%-500%-600%. ??* ??But none of this budges the Bush administration. ??Price caps Cheney declares may provide short-term political relief for the politicians. But they don't do anything to deal with the basic fundamental problem. That problem is supply he says price caps discourage investment in new power plants and encourage consumption. ??Counters Garry South Davis' political strategist: The notion by free market zanies that you have to let profits rise 500%-600% is ludicrous. Reasonable profits can be made without bankrupting the system. They're just trying to protect the profits of their friends in the energy business. ??In truth California is building power plants as fast as it can. But not enough new megawatts apparently will be online by summer to prevent blackouts--and the bleeding of billions more into the pockets of out-of-state profiteers. ??How about a temporary price cap? ??Six months? Six years? Cheney replies. Once politicians can no longer resist the temptation to go with price caps they usually are unable to ever muster the courage to end them . . . ??I don't see that as a possibility . . . Any package you can wrap it in any fancy rhetoric you can prop it up with it does not solve the problem. ??* ??The White House clearly understands it has a problem in California--a political problem. A problem with a Democratic-dominated state that voted overwhelmingly for Al Gore. And now a problem with that mythical headline--Bush to California: Drop Dead--which seems to be getting bigger each day. ??There have been several recent California: Drop Dead stories. One was in Sunday's New York Times--Bush Devoting Scanty Attention to California. Tuesday the Sacramento Bee reported that when Cheney met with Northwest members of Congress to discuss West Coast energy he barred Californians from the room. ??Cheney flatly denies it. ??But Sen. Dianne Feinstein (D-Calif.) says she has had trouble making contact with the Bush White House. She has sent two letters to President Bush asking for a meeting on energy. The first time she got back a form letter with her name misspelled. On the second try she got a group meeting with Cheney. ??It was very disappointing she says. He spoke about letting the free market work and drilling in Alaska . That's not going to help California in the short-term. We need price caps until we're able to fix this very broken market. . . ??There seems no interest in really wanting to understand the California situation. ??I asked Cheney whether he sensed an anti-California bias across the country? No more than there's an anti-Texas bias he replied. I wouldn't get paranoid about it. ??The fact is California is one of the leading states in the nation. Often a trendsetter. . . . Well we hope not to emulate your energy policy. Hopefully we'll learn from that. ??His message to California: There's no reason not to be optimistic. The energy crunch obviously is a significant problem. . . . But it too will pass. ??While learning from California the Bush White House also might take a refresher course in the free market Hoover administration. LOAD-DATE: April 19 2001 of 63 DOCUMENTS 2001 / Los Angeles Times Angeles Times ????????????????????April 19 2001 Thursday Home Edition SECTION: Part A Part 1 Page 3 Metro Desk LENGTH: 1373 words HEADLINE: CALIFORNIA AND THE WEST DAVIS BACKS SILICON VALLEY POWER PROJECT ENERGY: GOVERNOR URGES QUICK APPROVAL OF SAN JOSE PLANT DESPITE OPPOSITION BY CITY AND A POWERFUL FIRM. BYLINE: JENIFER WARREN and TERENCE MONMANEY TIMES STAFF WRITERS DATELINE: SACRAMENTO BODY: ??Attempting to show that no region in California is safe from sacrifice Gov. Gray Davis on Wednesday called for quick state approval of a controversial power plant proposed for the Silicon Valley. ??The governor's action locks him in combat with the San Jose City Council which has unanimously rejected the plant and Cisco Systems the computer networking giant that wants to build its worldwide headquarters on adjacent land. ??In praising the proposed plant as a model of low-polluting efficiency Davis said all regions of California must share the pain as the state expands its power supply--a key step toward ending blackouts and reducing sky-high electricity prices. ??If approved the plant would be the 14th licensed by the California Energy Commission since Davis took office. The 13th--a 510-megawatt plant near San Diego--was approved unanimously by the commission Wednesday with little controversy. ??Rushing to expand the state's overtaxed energy supply the governor has recently cut in half the approval times for the licensing of some plants. Six are under construction according to Davis and three are scheduled to begin operation this summer. A fourth--the AES Corp. generator in Huntington Beach that is due to be restarted --could add more megawatts to the supply this summer. ??V. John White an energy consultant in Sacramento said the governor's newly active role as an advocate for power plants was a necessary step given the urgency of the supply shortage. ??It's very rare and I wouldn't want him to short-circuit the commission's review process White said. But I think he's trying to reassure folks we're doing everything we can and not just sitting around in our hot tubs. ??Davis urged the Energy Commission--a five-member panel dominated by his appointees--to stop talking about the project and grant it a license. If the commission does so it will mark only the third time the panel has usurped a local government's authority over zoning. ??We are all in this together Davis said flanked by a forest of electric transformers near the Capitol. We are one state and we all have to make the sacrifices necessary to make up for the mistakes of the last 12 years when no major power plants were built. ??The governor said the plant's developers Calpine Corp. and Bechtel Enterprises Holdings Inc. have made numerous concessions to San Jose officials including an agreement to sell power exclusively in the region. ??He added that the $ 300-million plant--expected to supply about 450000 homes--will be equipped with state-of-the-art systems that make it one of the cleanest plants to go up in the nation. ??The commission's staff has recommended licensing the project and some analysts said the governor's intervention--said to be unprecedented--should fuel momentum for approval. ??Commissioner Robert Laurie--one of two members who held evidentiary hearings on the project and is preparing a recommendation for the full commission--would not comment on the plant's prospects. But Laurie an appointee of former Gov. Pete Wilson insisted that the project would receive an impartial review. ??I know the importance of independent decision-making he said. ??San Jose officials say the Calpine project conflicts with the aesthetics of its site in a bucolic valley 15 miles south of downtown. On Wednesday Mayor Ron Gonzales urged the Energy Commission to give serious attention to the city's concerns about the plant's potential impact on residents and the environment. ??As the project has been designed and proposed to operate . . . it would present an unfair burden to our community the mayor said. ??A spokeswoman for the Calpine/Bechtel partnership disagreed and characterized the plant as key to restoring energy stability in the Silicon Valley a region heavily dependent on imported power. ??This is the only project in the pipeline that can help Silicon Valley out of its predicament in the near future said the spokeswoman Lisa Poelle. ??She expressed hope that the governor's comments which cap numerous meetings between the partnership staff and Davis aides would encourage San Jose to soften its stance on the project. ??The 600-megawatt plant is proposed for a swath of open space currently leased to a rancher and occupied by grazing cattle. A preliminary ruling by Laurie and the other commissioner scrutinizing the project is expected by June. The full commission would take a final vote about a month later and if a license were granted the plant would begin operations sometime in 2003. ??From the beginning the plant has been dogged by opposition and the Energy Commission has held more than 20 hearings--an unusually large number--on its fate. ??On Wednesday a spokesman for its heftiest foe San Jose-based Cisco said the company still has serious concerns about health and safety issues. ??Cisco has strongly opposed the plant because the company wants to build a $ 1.3-billion headquarters for 20000 employees nearby. In the past Cisco officials have threatened to relocate to another state if the power plant is built. ??Company spokesman Steve Langdon said the firm's plans to build an industrial campus were not scuttled by the announcement Monday that it is cutting 8500 workers from its payroll because of slumping sales of its Internet networking equipment. ??But he suggested that the plans were flexible enough to be scaled down for a smaller work force and that the campus may not house the company's headquarters. ??It doesn't all get built at once he said. We will build and occupy the site over time in phases as needed. ??Another leading opponent of the power plant argued Wednesday that the Energy Commission lacks authority to override San Jose officials and license the project. The Santa Teresa Citizen Action Group launched by homeowners near the site says the commission may only take such a step if a better plant site hasn't been identified. ??The group charges that the commission is aware of other available sites including one in an industrial part of the East Bay area and lists eight other reasons the plant should not be built among them the noise and emissions it would produce. ??The local Sierra Club chapter however has endorsed the plant largely on grounds that it would run cleaner than existing plants in the area. By offsetting emissions from those older plants the new project would actually reduce air pollution said Kurt Newick of the Sierra Club's Loma Prieta chapter. ??On another front Davis continued to lobby legislators for support for his plan to rescue Southern California Edison from bankruptcy through purchase of the utility's transmission grid. ??Emerging from lunch with state Senate Democrats who are openly wary of the deal Davis said he'd made progress to bridge some of the gaps. It was the governor's third meeting in two days with lawmakers of both parties. ??Some of the toughest skeptics are members of his own party in the Senate. Many fear that the deal Davis struck with Edison will hand the utility too much at the expense of ratepayers and some say bankruptcy might be a better option for the state's second-largest private utility. Pacific Gas & Electric Co. filed for bankruptcy April 6. ??To assuage concerns Davis proposed that a special Senate committee be named to meet with his energy advisors as the administration and Edison finalize details of the deal before it goes to the Legislature for approval. ??Senate leader John Burton (D-San Francisco) who has called the Edison agreement problematic said he may appoint such a committee but continued to suggest that an Edison bankruptcy might be acceptable. ??Many of the Fortune 100 companies have gone into Chapter 11 bankruptcy and it ain't like the end of the world for anybody Burton said. ??* ??Times staff writer Carl Ingram contributed to this story. ??Powering Up California ??Power plant projects recently licensed by the California Energy Commission and when they are expected to go online: ??* ??* Two of four turbines are expected to go online in December 2001 the other two are expected to go online in March 2002. ??Source: California Energy Commission GRAPHIC: PHOTO: (2 photos) Gov. Gray Davis urges California Energy Commission to approve Metcalf Energy Center a 600-megawatt power plant planned for San Jose. Demonstrators greet Davis on his way to news conference in Sacramento. PHOTOGRAPHER: Associated Press PHOTO: (2 photos) Gov. Gray Davis urges California Energy Commission to approve Metcalf Energy Center a 600-megawatt power plant planned for San Jose. Demonstrators greet Davis on his way to news conference in Sacramento. ?PHOTOGRAPHER: ROBERT DURELL / Los Angeles Times GRAPHIC: Powering Up California Los Angeles Times LOAD-DATE: April 19 2001 of 63 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ??????????????????????????The Orange County Register 19 2001 Thursday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K7970 LENGTH: 275 words HEADLINE: Ex-energy chief leery of state buying power lines BYLINE: By Kate Berry BODY: ??ONTARIO Calif. _ Former Energy Secretary Bill Richardson said Wednesday that he is uncomfortable with the state's $2.76 billion purchase of the transmission lines of Southern California Edison because it would derail future plans to fully deregulate the state's electricity market. ??I'm leery of a state purchase Richardson said at an economic conference in Ontario adding that the jury is still out on a plan by Gov. Gray Davis to keep Edison out of bankruptcy. ??He called for a rescue of Pacific Gas and Electric the San Francisco utility that filed for bankruptcy two weeks ago. ??In a half-hour speech Richardson admonished the Bush administration for failing to take a more active role in the California crisis. He backs a one-year regional price cap to calm the volatile wholesale market. ??In the Clinton administration California was gold he said. With the new administration it's another ballgame. ??Richardson also pushed for a bipartisan energy bill with Democratic themes including energy-efficiency standards conservation and environmental regulations. ??We need an energy policy for this country that embraces both parties' proposals he said. ??Energy Secretary Spencer Abraham has sparred with Richardson by trying to rescind new energy-efficiency standards for air conditioners that were approved in the last 30 days of the Clinton administration. ??ARCHIVE PHOTOS available from NewsCom-PressLink: ??Richardson. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??(c) 2001 The Orange County Register (Santa Ana Calif.). ??Visit the Register on the World Wide Web at http://www.ocregister.com/ JOURNAL-CODE: OC LOAD-DATE: April 19 2001 of 63 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ???????????????????APRIL 19 2001 THURSDAY FINAL EDITION SECTION: NEWS Pg. A18 LENGTH: 585 words HEADLINE: Alameda public utility rents four backup generators Extra electricity will be used during summer rolling blackouts SOURCE: Chronicle Staff Writer BYLINE: Matthew Yi DATELINE: Alameda BODY: Alameda's public utility announced yesterday that it is leasing four portable diesel electrical generators to avoid the one woe of the state's energy crisis they haven't been able to duck so far -- rolling blackouts. ???The utility's move to provide a backup source of electricity for its customers is part of a trend among city-owned utilities to gear up for expected power shortages during the dog days of summer. ???Healdsburg Santa Clara and Palo Alto -- all with their own electric grids -- are also initiating their own energy backup plans. ???The generators would kick in only during severe energy shortages when rolling blackouts are on the horizon. ???In Alameda four generators -- each the size of a tractor trailer -- arrived last week and are ready to be fired up Alameda Mayor Ralph Appezzato said yesterday. ???We're going to be the masters of our destiny he said. ???Alameda Power and Telecom is one of about 30 municipal utilities in California that opted not to deregulate with the rest of the state four years ago. Consequently its customers' power rates are expected to be stable this year while Pacific Gas and Electric Co. customers face huge rate increases. ???But municipal utilities such as Alameda's are still part of the statewide power grid which is managed by the Independent System Operator and are subject to rolling blackouts like everybody else when the state's energy reserves dip below 1.5 percent. ???Each of Alameda's four diesel generators will produce 1.5 megawatts of power. Each megawatt can light up 1000 homes utility officials say. ???The units leased at a total cost of $68000 a month through the end of the year are parked at Alameda Point. ???Their cost will be paid through the municipal utility's reserve fund and customers' power bills won't be affected said Junona Jonas the utility's general manager. ???I think in the long run we'll see more supply in the state but until that happens there will be communities that'll have to take these short-term drastic measures Jonas said. ???The utility's spokesman Matthew McCabe said the diesel exhaust from the generators won't be an environmental factor. ???Our environmental record is extremely important to us McCabe said. The diesel generators are only for emergency backup. . . . Besides these things are clean -- it's not like standing next to a diesel bus. ???The city is also getting help from the U.S. Maritime Administration which operates more than a dozen ships at the former Navy station in Alameda. When the juice is low those ships will unplug from the port and use onboard generators Jonas said. ???In the North Bay Healdsburg officials are waiting for the arrival of two diesel generators. Combined they are expected to produce 3.5 megawatts of power which can account for about 20 percent of the city's expected summer peak load said Bill Duarte city utility director. ???We're taking matters into our own hands he said. ???Farther south both Santa Clara and Palo Alto are considering leasing portable generators officials said. ???Bill Reichmann senior electric utility engineer at Santa Clara's Silicon Valley Power said the utility is planning to lease eight generators operating them in the southeastern end of town near the San Jose International Airport. ???Palo Alto's municipal utility also has recommended that the City Council approve renting two generators starting next month said spokeswoman Rima Johnson.E-mail Matthew Yi at myi@sfchronicle.com. LOAD-DATE: April 19 2001 of 63 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ???????????????????APRIL 19 2001 THURSDAY FINAL EDITION SECTION: NEWS Pg. A3 LENGTH: 845 words HEADLINE: Davis' gouging claims disputed Officials say no link between PG&E bankruptcy high prices SOURCE: Chronicle Staff Writer BYLINE: David Lazarus BODY: Officials on the front lines of California's energy mess yesterday challenged Gov. Gray Davis' assertion that the state is being gouged by power companies because of PG&E's bankruptcy filing. ???Such dissent from the governor's own subordinates could make it harder for Davis to gain support for his energy measures in the state Legislature. ???Despite Davis' latest claims the Department of Water Resources which is spending about $70 million a day buying power said there is no evidence linking recent price increases to Pacific Gas and Electric Co. filing for bankruptcy protection on April 6. ???It is a seller's market said Viju Patel executive manager of the Department of Water Resources' power systems department. The power companies do not need an excuse to raise prices. ???Critics say Davis' penchant for secrecy on energy issues has come back to haunt him at a time when he needs all the allies he can find. ???People aren't taking his words at face value said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. ???Republican lawmakers -- and even some Democrats -- have challenged a number of the governor's initiatives including a multibillion-dollar bailout scheme for Southern California Edison. ???Nevertheless Davis reiterated his belief yesterday that recent electricity price increases are an aberration driven by the bankruptcy of PG&E. ???He said California's spending on power jumped 40 percent in the week following PG&E's bankruptcy filing because generators say they face a greater risk of not being paid. ???Nothing else in the equation has changed said Steve Maviglio a spokesman for the governor. Everything is the same except the bankruptcy. ???However power companies were quick to challenge this assertion. They insisted that PG&E's bankruptcy actually was seen as a positive development by those in the energy business. ???If anything PG&E provides some solace for traders because the bankruptcy provides an organized mechanism for recovery of payments said Gary Ackerman executive director of the Western Power Trading Forum a Menlo Park energy-industry association. ???On the other hand he acknowledged that power companies are becoming increasingly wary of the state of California's creditworthiness as an energy buyer. ???The Department of Water Resources already has spent nearly $5 billion buying electricity and has yet to recoup a dime from ratepayers. State regulators are still trying to come up with a way to apportion the limited revenues from power rates among the various parties in California's energy picture. ???Rating agency Fitch Inc. said yesterday it may cut the state's credit rating because of questions surrounding recovery of energy costs. ???People are keeping an eye on things Ackerman said. They're watching how California finances things. ???If a premium on electricity sales to the state exists he said it probably has been in place since the beginning of the year well before PG&E's current woes. ???UCAN's Shames agreed. He said power companies added a risk premium to their California power sales late last year when it looked like the state's energy troubles were worsening. ???PG&E's bankruptcy may have increased the uncertainty Shames said but we've been paying a risk premium for months now. ???Richard Wheatley a spokesman for Reliant Energy in Houston insisted that his company's traders are not using questions about PG&E's or California's financial solvency as a fresh excuse for higher prices. ???I haven't seen any evidence of it he said. ???Mark Palmer a spokesman for Houston's Enron Corp. laid blame for recent price increases on low rainfall throughout the West which has cut output at hydroelectric facilities as well as on California's chronic power shortage. ???It's not that there's a premium on prices he said. It's just supply and demand. ???That said Palmer acknowledged that California's firm insistance on blackouts being avoided at all costs leaves the state vulnerable to virtually any price generators choose to demand. ???This means prices will be used to allocate a scarce resource he said. There's no other way it could work. ???Bottom line for consumers: It's going to be a long hot summer and electricity prices will soar even higher as demand surges. ???And despite the best efforts of state officials a daily threat of blackouts remains a virtual certainty as California's beleaguered power grid is stretched to the breaking point. ???At the Department of Water Resources' command center in a Sacramento shopping mall the state's team of electricity traders has moved onto a new high-tech trading floor where they negotiate power deals each day from the crack of dawn. ???The department's Patel said daily blackouts may be averted this summer after consumers see skyrocketing power prices reflected in their bills. ???People will respond to these prices and they are going to conserve like never before Patel predicted.E-mail David Lazarus at dlazarus@sfchronicle.com. GRAPHIC: PHOTO Gov. Gray Davis urged the California Energy Commission to approve construction of the proposed 600-megawatt power plant. / Associated Press LOAD-DATE: April 19 2001 of 63 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ???????????????????APRIL 19 2001 THURSDAY FINAL EDITION SECTION: NEWS Pg. A3 LENGTH: 888 words HEADLINE: Davis backs San Jose power plant He also acknowledges bailout for Edison will be uphill fight SOURCE: Chronicle Sacramento Bureau BYLINE: Lynda Gledhill DATELINE: Sacramento BODY: Gov. Gray Davis urged the state Energy Commission yesterday to approve a controversial power plant in San Jose saying California needs every megawatt it can harness. ???Davis' recommendation runs counter to the wishes of the San Jose City Council and Mayor Ron Gonzales who have come out against the 600-megawatt Metcalf Energy Center in south San Jose's Coyote Valley. It also puts the governor at odds with one of his political allies Cisco Systems chief John Chambers whose company opposes the plant because it would be built near the tech firm's proposed new campus. ???Davis' announcement came the same day he all but admitted he lacks the support he needs in the state Senate for the deal he reached with Southern California Edison to restore the utility to financial health. Davis has portrayed that deal and construction of new power plants as essential to making California's energy market functional again. ???I think when we have an opportunity to put more power on line we should seize it Davis said. I believe we spend too much time talking about Metcalf. It's time to start building it. ???The Energy Commission has been reviewing the proposal by Calpine Corp. and Bechtel Enterprises Inc. for months. The commission's staff recommended in October that the plant be built and a final decision is expected by summer. If it is approved the plant could come on line next year and provide enough electricity for 600000 homes. ???None of the five commissioners could be reached yesterday. Three are Democrats appointed by Davis and two are Republicans appointed by former Gov. Pete Wilson. ???Gonzales and the rest of the City Council rejected the Metcalf plant in November. Until yesterday Davis had sat on the sidelines as the energy crisis deepened and a long line of state and federal officials including four of the five Assembly members from Silicon Valley urged the commission to overturn the council's vote. ???Some neighborhood groups oppose the plant along with computer networking giant Cisco which hopes to build a 20000-worker campus on a neighboring parcel. Cisco chief Chambers donated $50000 to Davis in the first six months of last year. ???Cisco's reaction yesterday was restrained. ???We have great respect for the governor and respect his decision said Cisco spokesman Steve Langdon. ???However Langdon added: We still have serious concerns about health and safety issues related to the proposed power plant. ???Some neighbors were much angrier. ???He's trying to act like he's the big bad tough governor and he's spineless said Issa Ajlouny who lives in the Santa Teresa neighborhood less than a mile from the proposed plant. He knows the approval process isn't working in his favor so he's trying to come out and act like a hero to the state of California. But he's nothing but backstabbing the city of San Jose on the environmental issues. ???Supporters of the plant see the 14 acres of former junkyard as the perfect site -- right next to Pacific Gas and Electric Co.'s largest substation in the South Bay close to major transmission lines and shielded from its neighbors by a 350-foot hill. ???But a housing development is also nearby and residents fear the power plant will belch pollutants in an area already suffering from some of the worst air quality in the Bay Area. ???Mayor Gonzales continued to express his concern yesterday. ???I would support clean power plants that will help us achieve greater energy self-sufficiency for San Jose residents and business Gonzales said. As the Metcalf project has been designed and proposed to operate however it would present an unfair burden on our community. ???That's not what Davis said however calling Metcalf one of the cleanest most efficient plants in the country. ???Davis praised the efforts of Calpine/Bechtel to work with the local community and said he was especially pleased that the venture had agreed to commit all the power to the local region. ???The Silicon Valley is obviously the engine driving our economy but they are very dependent on outside power Davis said. ???Also in Sacramento yesterday after an hourlong session with Senate Democrats -- the toughest legislative sell for Davis' proposed Edison deal -- the governor all but admitted his plan could not win enough votes for Senate approval. ???I think he knew there weren't enough votes going in said Sen. Don Perata D-Oakland. But there may be a way of perfecting a deal people can at least think of supporting. ???Senate Democrats have openly opposed Edison's deal saying the only beneficiaries are Edison shareholders and power generators who would be paid every cent owed them by the utility -- at the expense of customers who would pay more to erase Edison's debt. ???Unlike his meeting with Assembly Democrats after which Davis said he was encouraged the governor said yesterday he wanted the Senate to appoint a special committee to iron out differences over the Edison deal. ???Senate President Pro Tem John Burton D-San Francisco said he was not aware a committee was being set up. He said he favored an up-or-down vote on Davis' current proposal.Chronicle staff writers Greg Lucas Alan Gathright and Maria Alicia Gaura contributed to this report. / E-mail Lynda Gledhill at lgledhill@sfchronicle.com. GRAPHIC: PHOTO Gov. Gray Davis urged the California Energy Commission to approve construction of the proposed 600-megawatt power plant. / Associated Press LOAD-DATE: April 19 2001 of 63 DOCUMENTS 2001 Pacific Press Ltd. Vancouver Sun ????????????????????April 19 2001 Thursday FINAL EDITION SECTION: BUSINESS Pg. F1 / Front LENGTH: 731 words HEADLINE: B.C. Hydro's credit to California firms exceeded 1999 guidelines BYLINE: David Baines SOURCE: Vancouver Sun BODY: ??A confidential document issued in late 1999 shows that B.C. Hydro's power-trading subsidiary Powerex set a credit limit of $100 million US for its California customers. ??However by the end of 2000 Powerex had extended three times that amount of credit to those customers -- the California Independent System Operator and the California Power Exchange. With the California Power Exchange and Cal-ISO's major customer Pacific Gas & Electric under Chapter 11 bankruptcy protection repayment of this debt is now in doubt. ??Powerex spokesman Wayne Cousins noted that the document obtained by The Vancouver Sun which is marked strictly confidential was issued in November 1999. ??That's an old copy of our risk-management policy he said in an interview Wednesday. ??Credit limits have changed since then based on careful assessment of several factors including market conditions risks maintaining long-standing relationships and helping California meet its electricity needs to prevent crisis situations. ??Temporary revisions were only implemented after very diligent review incorporating the best market intelligence available our own due diligence and on-going dialogue with appropriate market participants. ??He refused to say when the credit limits for Cal-ISO and the California Power Exchange were increased. ??That type of information is confidential. You have a copy that I assume was leaked in some way but this is commercially confidential information. ??He said the increase in credit limits helped B.C. Hydro achieve record net income of about $1 billion during the year ending March 31. This figures does not include any write-downs that may occur if Powerex determines that any of its customer accounts are not collectible. ??Cousins however was insistent that all debts will be collected: We continue to pursue monies owing and we expect to be paid for electricity we have sold. ??He noted that Powerex suspended trades to all California entities on Dec. 8 unless those trades were fully secured by creditworthy customers. ??By that time Cal-ISO and California had racked up an unpaid bill of about $ 300 million US or $475 million Cdn -- about half the net income that Hydro has tentatively reported for the year ending March 31. ??The confidential document states that Powerex's policies and procedures are designed to control the risk of financial loss due to changes in market prices or volatility and the risk that a counterparty (customer) in a commodity transaction defaults on delivery and/or settlement. ??It states that the amount of credit to be advanced to any customer depends on its credit rating. An AAA customer for example may be granted credit to a maximum of $20 million. ??Cal-ISO and California Power Exchange are not utilities they are power pools. They purchase power from Powerex and other suppliers and re-sell it to utilities such as Pacific Gas & Electric and Southern California Edison. ??The pools are not rated but are assigned specific credit limits. As of November 1999 Cal-ISO had a credit limit of $40 million US and the California Power Exchange $60 million US. ??The risk-management document notes that the credit-worthiness of these pools depends on that of its suppliers. ??The Powerex credit-risk manager and the treasury manager are responsible for initially evaluating and then monitoring the credit-authorization policies and credit limits for each power pool in which Powerex trades the document states. Significant alterations in the credit policies of a power pool will trigger a mandatory reappraisal of the power-pool credit limit. ??California has been caught in a power vice in recent months. The problem dates back to 1996 when the state developed a plan to deregulate the electricity business. Competition was supposed to lower rates below a price cap that had been imposed. ??However dry conditions cut the ability to generate hydro-electric power and a surge in the state's economy created unprecedented demand for electricity. Prices soared. ??The result was that the California utilities paid record prices for power but weren't allowed to pass along the full cost to consumers. ??Pacific Gas & Electric and Southern California Edison the state's two biggest utilities now owe about $12 billion. ??dbaines@pacpress.southam.ca TYPE: Business LOAD-DATE: April 19 2001 of 63 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ?????????????????????April 18 2001 Wednesday BC cycle SECTION: Business News LENGTH: 348 words HEADLINE: Williams again target of overcharging allegations from federal regulators DATELINE: TULSA Okla. BODY: ??Federal regulators are once against targeting Williams for allegedly overcharging Californians for electricity. ??The Tulsa-based energy company was cited in a notice this week from the Federal Energy Regulatory Commission for allegedly overcharging California customers $25574 in March. ??Two other companies were also cited in the notice from federal regulators Monday. ??Dynegy Power Marketing Inc. of Houston was cited for overcharging California customers $469662 while Mirant California LLC of Atlanta was cited for overcharges of $92620. ??The commission told Williams and the other two companies to either refund the money or justify their prices which exceeded a price of $300 per megawatt hour that was set by the Federal Energy Regulatory Commission because of the California's electricity shortage. ??Williams also was accused of excessive charges of $8 million in January and $ 21.6 million in February for a total of $29.6 million. ??Williams spokeswoman Paula Hall-Collins said while the overpricing allegations against Williams in March were not as significant as in the other months the process of justifying them will be the same as in previous months. ??They determine the price that they feel is fair and justifiable and then we come back and say why we charged what we did she said. ??Hall-Collins said federal regulators haven't said whether they are satisfied with how Williams justified its alleged overcharges from previous months. ??Also in March the commission accused Williams and AES Southland of generating less power to drive up electricity prices in May and June 2000 resulting in alleged overcharging of $10.8 million. ??Williams denies overcharging for electricity it provides. ??In other news Williams Express Inc. a unit of Williams announced Tuesday it was selling 198 MAPCO Express convenience stores to Israel-based Delek Group for $147 million. Most of the stores are in Tennessee and executives expect to close the deal by the end of May. ??Williams will keep 29 MAPCO stores in Alaska. LOAD-DATE: April 19 2001 of 63 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ?????????????????????April 18 2001 Wednesday BC cycle SECTION: State and Regional LENGTH: 332 words HEADLINE: Governor congressman to fight proposals for national power deregulation policy BYLINE: By MARGERY BECK Associated Press Writer DATELINE: LINCOLN Neb. BODY: ??Gov. Mike Johanns and Rep. Lee Terry R-Neb. said Wednesday they will be working to make sure national leaders understand Nebraska's stance on a national energy policy. ??Nebraska's unique status as the only 100 percent public power state in the nation and its reliance on the corn-based fuel additive ethanol make the state's input in the development of national energy policy important Johanns said. ??Public power has worked very well for Nebraska consumers by providing low cost electricity he said adding that the deregulated state of California has suffered through weeks of rolling blackouts. We are committed to protecting public power in this environment of deregulation. ??Terry said he has talked at length to the staff of Vice President Dick Cheney who has been tapped to come up with a national energy policy draft. That draft will end up before the House Energy and Commerce Committee on which Terry serves. ??There will be a discussion about a national deregulation policy Terry said. ??A national deregulation policy would threaten Nebraska's public power system Terry and Johanns said. Terry said he plans to push for a states' rights exemption to any such policy. ??It is absolutely necessary that Nebraska have a voice in that discussion Terry said. ??Terry said he also has pleaded with the Bush administration not to grant a request from California to wave the Clean Air Act's gasoline oxygen requirement. ??Such a move is considered a death knell to ethanol a clean-air fuel additive because other states would be expected to follow suit in requesting - and receiving - similar waivers thereby destroying ethanol's market. ??They did not telegraph their position on the waiver Terry said of White House which is expected to decide on California's request this spring. ??Other energy concerns Nebraska leaders hope to address are rising heating costs and gasoline prices which are expected to top $2 a gallon in Nebraska this summer. LOAD-DATE: April 19 2001 of 63 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune Business News 2001 San Jose Mercury News Jose Mercury News 18 2001 Wednesday KR-ACC-NO: SJ-POWER-PLANT LENGTH: 1038 words HEADLINE: California Governor May Back Energy Firm's Proposed Power Plant BODY: ??Under intense pressure to increase California's energy supply Gov. Gray Davis is expected to announce today his support for Calpine Corp.'s proposed South San Jose power plant -- a move that could ensure the state's most controversial power project is built. ??Davis said for months that he would not interfere in the environmental review of the proposed 600-megawatt power plant. But a source close to the governor said Davis has decided to use Calpine's Coyote Valley project to send a signal that California is ready to build more power plants and is open to business. ??San Jose has strenuously opposed the power plant. But Davis' decision to urge the California Energy Commission to approve it would likely hold sway with the agency which has authority over where plants are located but has almost never overridden local opposition. ??The commission -- three of whose five members were appointed by Davis -- is expected to complete its environmental review and make a decision early this summer. ??A spokesman for the governor declined to confirm the endorsement. But late Tuesday the governor scheduled a press conference for this morning to make an important energy generation announcement. ??San Jose Mayor Ron Gonzales declined to comment. But another of the plant's leading opponents pledged to keep fighting what would be the South Bay's largest power plant. ??An endorsement from Davis would cap a stunning turnaround for the project. ??Five months ago Calpine's Metcalf Energy Center was unanimously rejected by the San Jose City Council which decided that the power plant would be incompatible with the city's plans to develop high-tech campuses in North Coyote Valley. ??Some Calpine officials even considered giving up plans to build the power plant. ??But as California's energy woes intensified the Metcalf plant increasingly became a poster child for the need for more power generation to reduce the skyrocketing cost of electricity and avoid rolling blackouts. Silicon Valley one of the state's largest electricity consumers produces only a fraction of the energy it uses. ??Despite fierce opposition from local residents concerned about the environmental effects of a large power plant a steady stream of state and local organizations lined up behind the project including the Silicon Valley Manufacturing Group the San Jose Silicon Valley Chamber of Commerce and the local chapters of the Sierra Club and American Lung Association. ??The California Assembly voted unanimously in February to urge the energy commission to override San Jose and license the power plant. ??And top officials and attorneys at the energy commission have been working for months to ensure that the project wins approval a Mercury News investigation of the commission's environmental review of the project showed. The officials undermined negative environmental assessments of the Metcalf site and silenced commission analysts who said other sites would be better. ??The energy commissioners are weighing the staff's recommendation to approve the plant. ??Commissioner Robert A. Laurie who oversaw hearings on the project insisted at one hearing two months ago that the commission would complete an independent review. ??Although Davis has stressed his efforts to speed construction of new power plants the governor insisted he would not take a position on the project. ??The governor has repeatedly said he wants the process to play out Davis press secretary Steve Maviglio said last week. The governor believes the energy commission should complete its review. ??But there have been growing signs that Davis would throw his weight behind Calpine's project. ??A senior energy commission official said aides to the governor have been calling the commission for months to urge quick approval of the Metcalf plant. The governor's press secretary said no calls have been made. ??When Davis was looking for a backdrop to hold a press conference earlier this year to announce his plans to speed up approval of new power plants he chose Calpine's new plant in Sutter. ??The company also has actively campaigned for the governor's support. ??Earlier this year Calpine offered to sell the state cheaper power from the plant if it is approved. ??When Calpine and its development partner Bechtel Enterprises were looking for a lobbyist in Sacramento the companies turned to Platinum Advisors whose president Darius Anderson was finance chairman of Davis' 1998 gubernatorial campaign. ??The San Jose-based company gave the governor $ 19000 last year according to state campaign finance reports. ??Maviglio said the governor's ties to Calpine are no different from his relationship with Cisco Systems CEO John Chambers who has opposed the power plant. Campaign finance reports show Chambers gave Davis $ 50000 last year. ??Calpine officials said Tuesday they did not know of the governor's impending announcement. But they said they were not surprised. We've been working with the governor on a number of issues said project manager Ken Abreu. Metcalf is just one of them. ??Meanwhile Calpine's opponents in San Jose City Hall and in the neighborhood nearest the proposed power plant appear more isolated than at any time since the contentious debate over the Metcalf site began more than two years ago. ??Mayor Gonzales refused to comment on Davis' planned announcement. I don't respond to rumors said the mayor who has helped lead opposition to Metcalf. I have not heard anything. If he makes a statement I'll respond. ??But one of Calpine's fiercest local opponents said the nearby Santa Teresa neighborhood will continue to fight. We have a strong case said longtime South San Jose resident Issa Ajlouny. And we will win. ??The Mercury News strives to avoid use of unnamed sources. When unnamed sources are used because information cannot otherwise be obtained the newspaper generally requires more than one source to confirm the information. ??By Noam Levey and Mark Gladstone. Mike Zapler of the Mercury News contributed to this report. ??----- ??To see more of the San Jose Mercury News or to subscribe to the newspaper go to http://www.sjmercury.com JOURNAL-CODE: SJ LOAD-DATE: April 19 2001 of 63 DOCUMENTS 2001 Scripps Howard Inc. Howard News Service 18 2001 Wednesday SECTION: DOMESTIC NEWS LENGTH: 588 words HEADLINE: Davis says Edison agreement may need altering SOURCE: Scripps-McClatchy Western Service BYLINE: EMILY BAZAR and KEVIN YAMAMURA DATELINE: SACRAMENTO Calif. BODY: ??Gov. Gray Davis indicated Wednesday that he may need to alter the agreement to purchase Southern California Edison's transmission lines if he wants legislators to approve the deal. ??Though the Democratic governor declined to discuss particulars he said he asked Senate leaders to appoint a special committee dedicated to resolving disagreements between the administration and lawmakers. ??Many provisions of the memorandum of understanding the document that lays out the terms of the Edison deal must be approved by the Legislature and the state Public Utilities Commission. ??There is a determination to try and solve this problem whether or not it means amending the MOU or trying a slightly different approach Davis said after meeting with Senate Democrats. ??A spokesman for the utility declined to comment on the governor's statements. ??Davis announced the Edison agreement April 9 just three days after Pacific Gas & Electric Co. unexpectedly cut off transmission line negotiations with the governor and filed for bankruptcy protection. ??The deal would require the state to pay $2.76 billion for Edison's transmission lines or 2.3 times book value. In addition a portion of consumer electricity rates would be dedicated to paying off the remainder of the utility's debt estimated at about $5 billion. ??Both Edison and PG&E stockpiled massive debt when wholesale electricity prices soared. Price caps prevented them from passing along the entire cost of electricity to consumers. ??Since the Edison deal was announced however legislators have been critical of certain provisions suggesting that California consumers will receive little in return for relieving the utility of billions of dollars in debt. ??It's clear that the deal as is could well be problematic said Senate President Pro Tem John Burton D-San Francisco. This has to do with what's in the bill what's in it for the people of the state. ??Lawmakers initially believed they would have little ability to change the agreement and referred to it as a take it or leave it deal. ??In fact the memorandum of understanding itself says the deal can be nullified in the event any law is passed adopted or repealed ... (which) would materially impede or frustrate the ability of the Parties to effectuate all of the elements of the plan as a package. ??But in his meeting with Senate Democrats Davis indicated he may be willing to compromise. His goal he said is to keep Edison from following PG&E into bankruptcy. ??We still have some work to do Davis said. I think the appointment of a special Senate committee assuming that happens will let us work through the detail in an appropriate fashion. ??Burton said he has not decided whether to appoint a committee. ??Other senators came out of the meeting guardedly optimistic that they could compromise with the governor. ??It was obvious that there were concerns from members said Sen. Don Perata D-Alameda. He is open and ready to have the proposal perfected as it moves through the legislative process. ??Sen. Jackie Speier D-Hillsborough said she hopes to amend the deal to ensure power generators are penalized for over-charging the utilities and the state for electricity. ??The way it's presently crafted (generators) are being rewarded she said. They are getting a premium for selling electricity at a higher premium than ever conceived of by humankind. ??(Contact Emily Bazar and Kevin Yamamura of the Sacramento Bee in California at http://www.sacbee.com.) LOAD-DATE: April 19 2001 ??? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ""The"" Bullet Body:: looks good Richard Shapiro 05/01/2001 06:39 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: The Bullet Let's discuss. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Thurs 7/5: Many rural towns to escape blackouts utility maps sho= w Sac Bee Tues 7/3: Details emerge in power contracts SD Union Thurs 7/5: New FERC member seems attuned to state's woes SD Union Wed 7/4: Electricity price-cap tests spark allegations SD Union Wed 7/4: Renewable energy fades from picture in rush for solutio= n SD Union Wed 7/4: SDG&E spreads word of looming blackouts SD Union Wed 7/4: Two more energy whistleblowers slated to come forward SD Union Wed 7/4: Disabled PG&E employees ask state for help in getting= =20 disability checks LA Times Thurs 7/5: Powerful Judge Illuminates Energy Practices Law:=20 'Folksy' jurist 72 stuns utility executives and lawyers alike with his=20 courtroom incisiveness. SF Chron Thurs 7/5: Davis lauds California generator=20 Vote of confidence at Calpine's festival=20 SF Chron Wed 7/4: Activists stage anti-corporate march to power plant=20 SF Chron Wed 7/4: Davis asks PUC to let utilities cut voltage=20 1% savings on energy consumption predicted SF Chron Wed 7/4: Federal price limits backfire=20 Some generators withhold power rather than abide by rate caps SF Chron Wed 7/4: Two more energy whistleblowers slated to come forward Mercury News Wed 7/4: Davis seeking cheaper contracts=20 --- Many rural towns to escape blackouts utility maps show=20 By Carrie Peyton Bee Staff Writer (Published July 5 2001)=20 Huge stretches of Northern California including many rural foothill and=20 valley communities won't face rolling blackouts this summer spared by a= =20 combination of geography and circuitry.=20 Placerville and Loomis Esparto and Isleton are among the many towns that= =20 will be largely or entirely bypassed by deliberate blackouts according to= =20 new Pacific Gas and Electric Co. outage maps.=20 Such communities are served by so few circuits that each one has been=20 exempted from outages because a critical facility such as a fire station o= r=20 a water treatment plant lies along the circuit somewhere PG&E spokesman= =20 John Nelson said.=20 Both PG&E and the Sacramento Municipal Utility District have begun shedding= =20 more light on their strategies for rotating outages in the wake of a=20 governor's order requiring utilities to let people know where blackouts wil= l=20 strike next.=20 For PG&E that has meant quickly posting and then updating blackout maps on= =20 its Web site. For SMUD it has meant publicly detailing for the first time= =20 the boundaries of 78 separate rotating outage areas and listing by number= =20 which areas could be tapped next.=20 We were contemplating putting the map on the Web before the governor's=20 order but the timing coincided very well said John DiStasio SMUD's=20 assistant general manager for customer service.=20 SMUD updated its Web site www.smud.org on June 22 so that now people can= =20 click on rotating outages and then next likely locations and map to see= =20 the shape of outages to come.=20 The map replaces less-precise neighborhood names which is all SMUD supplie= d=20 until Gov. Gray Davis ordered utilities to give the public common=20 geographical boundaries grid or block numbers maps or similar identifying= =20 information about where outages will strike.=20 With six days of rolling blackouts already behind California this year and= =20 forecasts that more probably lie ahead Davis has told utilities and the=20 state Independent System Operator to give better notice of when and where= =20 blackouts might occur.=20 Grid operators and utilities have cautioned that Davis' program of two-day= =20 one-day and one-hour warnings could produce many false alarms because power= =20 supplies often come through at the last minute. There is also some wariness= =20 about outage maps which SMUD and PG&E warn could change at any time.=20 But the maps do provide insight into how each utility will roll blackouts= =20 through its territory. PG&E's maps on the Web at www.pge.com under find= =20 your outage block and then rotating outage block map have recently been= =20 updated to be searchable by zip code.=20 They show that the vast majority of El Dorado and Placer counties and much = of=20 Yolo County are in PG&E's block 50 a designation for a circuit that won'= t=20 be in line for rolling outages because someone along it is crucial to healt= h=20 or safety.=20 Police stations fire stations hospitals and airports are all deemed=20 essential customers that should keep functioning even when the state power= =20 grid is so overloaded that blackouts are needed to keep it from collapsing.= =20 In densely populated areas circuits tend to be compact leaving lots of=20 neighborhoods eligible for rolling blackouts Nelson said.=20 But in rural areas particularly remote rural areas a circuit can go on f= or=20 miles and miles Nelson said. You can have multiple communities on one=20 circuit =01( (and) virtually every community has either a police station or= a=20 fire station or a hospital or a drinking water facility.=20 That has been good news for communities like Placerville which scrambled f= or=20 traffic control earlier this year when a rolling outage took out the signal= =20 lights on Highway 50 which bisects the town of 10000.=20 That has been our biggest concern because of the amount of traffic that go= es=20 through there said City Manager John Driscoll. Placerville will be spared= =20 future outages because regulators now are protecting more hospitals from=20 blackouts and much of the rest of the town shares circuits with hospitals.= =20 We didn't ask to be exempted out but I feel very happy that we are. From = a=20 selfish standpoint it feels very nice Driscoll said.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com.=20 =20 Details emerge in power contracts By Carrie Peyton and Chris Bowman Bee Staff Writers=20 (Published July 3 2001) California's power bills for the next decade probably will exceed the=20 forecasts of Gov. Gray Davis the State Controller's Office said Monday as = it=20 released unedited versions of long-term contracts in a new jab at the=20 governor.=20 The electricity contracts which Davis' office sought in court to keep=20 secret offer a glimpse into the rapid high-stakes deals struck early in t= he=20 state's power crisis and illustrate the way deregulation's unraveling could= =20 haunt California for years to come.=20 Some show that builders of new power plants could recoup the entire cost of= =20 those plants in four years or less. Some show lucrative swaps for power=20 including one arranged the same day California was rocked by rolling=20 blackouts.=20 More than two dozen additional administrative contracts detail the price=20 California is paying its consultants to seek a way out of the power mess= =20 from tens of thousands for Davis' aides down to $51 an hour for copying and= =20 phone answering.=20 The governor's office defended its estimates of the state's future power=20 bill.=20 The 41 long-term contracts 27 consulting contracts five short-term deals= =20 and stacks of receipts and invoices released Monday by state Controller=20 Kathleen Connell may just be the start.=20 Her office hopes to provide details about how much California has already= =20 paid individual power generators in the volatile short-term or spot=20 market.=20 The deals include so many intricate pricing formulas that Connell said she= =20 couldn't immediately predict exactly how high California's hourly power cos= ts=20 would go.=20 Walter Barnes chief deputy controller of finance said the contracts=20 probably would be well in excess of the $69 a megawatt-hour that Davis on= ce=20 said would be California's average cost for contract power for the next=20 decade.=20 The contracts' prices range from $55 to $249 a megawatt-hour and most are= =20 more than the $69 Connell said.=20 The state Department of Water Resources the state's power buying arm late= r=20 revised the $69 forecast to $70 a megawatt-hour through the end of 2010 wi= th=20 the higher priced power coming first.=20 If anything those figures could decline because natural gas the fuel for= =20 most new power plants is getting cheaper DWR spokesman Oscar Hidalgo said= =20 adding that his office sticks with its forecasts.=20 We're on pretty solid ground here he said.=20 As the statewide elected official who pays California's bills Connell=20 repeatedly has criticized the governor for his electricity spending saying= =20 that she never believed the contracts should be kept secret.=20 But Davis' office blasted her for giving out details that power generators= =20 and traders could use to learn the state's negotiating positions and buying= =20 practices and said the information could boost wholesale prices within days= .=20 When they open their electric bill next time every Californian can thank= =20 Kathleen Connell for higher electricity costs Davis spokesman Steve=20 Maviglio said.=20 The long-term contracts were first released June 15 by the water resources= =20 department with power plant names performance data delivery points and=20 other details blocked out under heavy black strokes.=20 Analysts said that was the sort of data they could have used to calculate h= ow=20 much more than the production costs the state was going to be paying for th= e=20 electricity purchased on behalf of three cash-strapped investor-owned=20 utilities.=20 As analysts began sizing up some of the specifics Monday early reactions= =20 were wary.=20 This just shows when the state comes in and takes over the utility system= =20 we're just going to be in deep from all sorts of expenses and inefficiencie= s=20 that we were trying to get away from with deregulation said Arthur=20 O'Donnell who edits a trade newsletter California Energy Markets.=20 Bill Marcus a power consultant who had analyzed the edited contracts for a= =20 consumer group quickly read through the unedited versions muttering things= =20 such as offensive and they got absolutely ripped here.=20 In one swap that was negotiated on a day of rolling blackouts in March the= =20 state agreed to send Powerex the trading arm of British Columbia's=20 government utility 2* times more electricity in the spring than Powerex=20 would return in the summer.=20 Although seasonal swaps are common the 2*-to-1 ratio was a sign of panic= =20 and inexperience on the state's part he said.=20 The consultants who advise California on power deals were frenetic at the= =20 time with one staffer at the Navigant consulting firm billing for hours=20 worked that were the equivalent of 9.7 hours a day for 34 consecutive days.= =20 The power purchase terms disclosed Monday confirm many energy analysts'=20 predictions that California consumers would be paying premium prices for=20 years to cover the costs of the new plants coming on line.=20 In several of the contracts the state agreed to pay generators a 25 percen= t=20 to 30 percent annual return on their plant construction costs which could= =20 pay off the entire plant in four years or less.=20 Before deregulation utilities generally received 3 percent to 18 percent= =20 annual return on their capital investments over 30 years said Marcus a=20 veteran energy analyst whose firm JBS Energy Inc. of West Sacramento=20 represents ratepayer groups.=20 We're all going to have to pay more for power plants over the next 10 or= =20 more years because the generators are looking to pay off their plants in ha= lf=20 the time he said.=20 Beyond blackouts and price spikes this will be the long-term legacy of=20 deregulation he said. The private market needs a high rate of return on= =20 their investment.=20 Several contracts were drafted in the late winter and early spring when=20 California endured Stage 2 and Stage 3 energy alerts.=20 The unmasked terms in some of those agreements reflect the state's=20 desperation for megawatts amid fears of routine blackouts when temperatures= =20 and energy use began to rise in the summer.=20 For example the state agreed in a March 29 contract to pay Calpine $232 a= =20 megawatt-hour to supply 300 megawatts nonstop from July 1 through Sept. 30.= =20 But a more recent Calpine contract calls for about $59 a megawatt-hour=20 starting Oct. 1.=20 Time made all the difference said Jim Macias a Calpine senior vice=20 president. He said that last winter Calpine couldn't guarantee that plants= =20 under construction in Sutter County and the East Bay would be on line by=20 summer. So the company bought the power on the spot market for the state= =20 Macias said.=20 Back in the winter $232 was a good price for electricity this summer he= =20 said.=20 Calpine officials said that they made no money on the sale and even knocked= =20 15 percent off their price to maintain good relations with the state power= =20 buyers.=20 The gesture more than paid off with the signing of the 10-year contract sa= id=20 Kathleen Potter Calpine spokeswoman.=20 It was a great transaction for us Potter said. We appreciate the=20 business.=20 Proponents of free-market energy buying have said that in the long-run= =20 competitive forces would result in more-efficient less-costly power=20 generation.=20 But the contracts show that pressed for more electricity this summer and=20 fall officials resorted to buying power from some of the least-efficient= =20 plants in the state guaranteeing owners of these aging generators 10 more= =20 years of income.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com. New FERC member seems attuned to state's woes=20 Texan may become agency's next chief By Toby Eckert=20 COPLEY NEWS SERVICE=20 July 5 2001=20 WASHINGTON -- During his first weeks at the Federal Energy Regulatory=20 Commission Pat Wood has set a decidedly different tone in the agency's=20 strained relationship with California.=20 After meeting with Gov. Gray Davis last week Wood -- who was recently=20 appointed to the commission by President Bush and is widely expected to be= =20 named chairman soon -- praised the state's efforts to come to grips with it= s=20 power problems. It was a stark contrast to the almost constant criticism fr= om=20 FERC Chairman Curtis Hebert.=20 It certainly seems to me that both the political leadership and the=20 regulatory leadership of the state are committed to the kind of=20 infrastructure upgrades that are needed to really get supply and demand bac= k=20 into whack Wood said referring to power plants being built in California= .=20 The former Texas utility regulator also raised the possibility of closer=20 cooperation between FERC and state regulators including a joint effort o= n=20 inspecting power plants. State officials have accused generators of idling= =20 plants to drive up electricity costs a charge generators deny.=20 If we're kind of co-regulators with the state and in many regards we are= =20 it's helpful to work off the same set of facts so you get to conclusions mu= ch=20 more expeditiously Wood said though he was quick to add that he has not= =20 seen any evidence of intentional withholding of supply.=20 State officials hope Wood's statements signal that FERC is poised to take a= =20 more aggressive role in helping the state. If elevated to chairman Wood=20 would set FERC's agenda and shape its approach to dealing with California.= =20 The agency regulates wholesale electricity and natural gas markets which= =20 have subjected the state to skyrocketing prices.=20 Wood has brought a very good perspective to FERC said Howard Gantman a= =20 spokesman for Sen. Dianne Feinstein D-Calif. a frequent critic of the=20 commission. He seems very interested in getting to the root of the problem= =20 and finding solutions.=20 Throughout the crisis the state's relationship with FERC has been poisonou= s.=20 Davis criticized the commission for being slow to rein in electricity price= s=20 while Hebert faulted the state for crafting a bad deregulation law and=20 failing to build enough plants to keep up with demand.=20 Davis issued a guardedly conciliatory statement after his meeting in=20 Sacramento with Wood and Commissioner Nora Brownell who is also new to FER= C.=20 In a refreshing change from my past dealings over the past year with the= =20 agency these commissioners offered a problem-solving approach in resolving= =20 California's energy challenge Davis said. He added It appears that FERC= =20 may finally be poised to do its job controlling energy costs.=20 Threats criticized Despite the soothing words there is no shortage of potential flash points= =20 between Davis and FERC.=20 Wood who professes a religious zeal about competition raised concerns= =20 about a possible move by the California Public Utilities Commission to keep= =20 retail power customers from shopping around for alternative providers.=20 He also criticized threats that Davis and other California politicians have= =20 made to seize power plants and impose a windfall profits tax on power=20 sellers.=20 I think the rhetoric's still pretty hot out there. If I were a generator= =20 looking at 50 states one that's talking about a windfall profits tax and= =20 expropriation of property and all that is not a great climate Wood said.= =20 For his part Davis has questioned whether the recent price curbs imposed b= y=20 FERC in the West will be enough to tame soaring wholesale power costs that= =20 have bankrupted one utility cost the state treasury billions of dollars an= d=20 raised consumers' power bills.=20 Davis has also made it clear that he expects hefty refunds to result from t= he=20 FERC-brokered talks between the state and power providers which are in the= ir=20 second week.=20 I will be vigilant in insisting that Californians get their money back= =20 Davis said.=20 California consumer activists are taking a wait-and-see attitude toward Woo= d=20 saying they know little about him.=20 A major role My impression from afar is he seems to be more moderate said Harvey=20 Rosenfield president of the Foundation for Taxpayer and Consumer Rights in= =20 Santa Monica.=20 Once considered a bureaucratic backwater the five-member FERC has come to= =20 play a high-profile role in the California debacle and other disputes=20 involving the largely deregulated wholesale power markets.=20 The commission is charged with ensuring that just and reasonable prices= =20 prevail.=20 Bush is expected to make Wood the FERC chairman because Hebert is seen as t= oo=20 much of a lightning rod.=20 Before coming to Washington Wood who turned 39 yesterday headed the Texa= s=20 Public Utility Commission. There he oversaw the state's move toward a=20 deregulated electricity market. Like Hebert Wood is convinced that a free= =20 market will deliver cheaper power to consumers than a highly regulated one.= =20 I just think customers fare better when they have more choices Wood said= .=20 But consumer advocates and others who have worked with Wood in Texas say hi= s=20 zeal is tempered by a healthy dose of pragmatism.=20 Bottom line it's all about the customer. Y'all will hear me say that unti= l=20 you get sick of it Wood said. We want to make sure that the world we're= =20 moving to is better than the one we left.=20 Electricity price-cap tests spark allegations=20 Suppliers said to have held back industry blames ISO By Craig D. Rose and Bill Ainsworth=20 UNION-TRIBUNE STAFF WRITERS=20 July 4 2001=20 The first emergency tests of new electricity price controls have generated= =20 accusations that suppliers were withholding power and questions that the ca= ps=20 might need to be revised or scrapped.=20 And in a case of turnabout a power industry spokesman yesterday said the= =20 Independent System Operator which manages the state's electricity grid=20 might be using the federal price caps to manipulate the electricity market.= =20 This time however the charge is that the ISO is gaming to push prices=20 lower.=20 At any rate California survived its second consecutive day of power=20 emergencies without blackouts under price caps recently imposed by federal= =20 regulators but not without some bumps along the way.=20 The main culprit was hot weather that baked Western states for two days=20 forcing the ISO to issue Stage 1 and then Stage 2 alerts. Yesterday the IS= O=20 warned that rolling blackouts might hit in the afternoon.=20 But as has happened often this year the ISO bought power in the last minut= es=20 to avoid outages. The grid operator also credited conservation efforts with= =20 shaving from 2000 to 4000 megawatts of consumption. A megawatt can power= =20 about 750 homes.=20 It was a lot hotter than expected and a lot more humid said Kristina=20 Werst spokeswoman for the ISO.=20 Today state officials expect to avoid any blackouts because of the holiday= =20 which tends to decrease electricity demand Werst said.=20 The price controls ordered last month by the Federal Energy Regulatory=20 Commission set up formulas for maximum prices during emergency and=20 nonemergency periods. The FERC said the complex system was intended to=20 balance the need for lower costs with its desire to promote a power market.= =20 But questions are growing about the effectiveness of the FERC price caps.= =20 A Department of Water Resources spokesman which buys power for the state= =20 said generators withheld between 660 and 1500 megawatts of electricity=20 during a critical period earlier this week because of the price caps. That= =20 would be enough to cut electricity reserves from 7 percent to 5 percent and= =20 bump a Stage 1 alert to a Stage 2.=20 Sempra Energy Trading a marketing unit of San Diego Gas & Electric Co.'s= =20 parent corporation admitted that it ceased selling power to the state for= =20 what could have been a critical 30 minutes Monday.=20 A spokesman for the trading company said it halted sales for the half-hour= =20 because it was unsure about where the ISO would set maximum prices during t= he=20 first power emergency under the new caps.=20 When power emergencies are called under the FERC plan a new price cap is s= et=20 based on the cost of operating the least efficient most costly electric=20 generating plant. Because the identity of that plant is unknown beforehand= =20 the selling price is set retrospectively by the ISO.=20 It was unclear to the traders what the proxy price would be said Doug=20 Kline a Sempra spokesman who emphasized that the company's trading unit= =20 resells power generated by other companies. So it was unclear whether the= =20 ISO would come back later and say 'You purchased power at $70 per=20 megawatt-hour but we're only going to pay you $60.'?=20 For its part the ISO said the impact of price controls on electricity=20 supplies during emergencies is still unclear. The controls this week kept= =20 emergency prices Monday from a little over $70 per megawatt-hour to a high = of=20 about $90. FERC's nonemergency price cap has been about $92 per=20 megawatt-hour.=20 Earlier this year the average price per megawatt-hour was nearly $300.=20 Before the power crisis hit last year the price was about $30.=20 The ISO said several factors other than the price controls might have=20 contributed to tight supplies this week including plant shutdowns in other= =20 states and the regional heat wave.=20 But a spokeswoman for Nevada Power said the utility believed the price caps= =20 or confusion over their implementation had contributed to a power shortfal= l=20 that led to blackouts Monday. The utility fell about 100 megawatts short of= =20 its need as temperatures in some of its service areas hit 122 degrees.=20 Power is tight in the region said Sonya Heagen of Nevada Power. What=20 tipped it over (for southern Nevada) was several utilities decided to hold= =20 back power.=20 Gary Ackerman executive director of the Western Power Trading Forum an=20 industry group said the FERC's price-control plan fails to allow the=20 recovery of electricity transportation costs. That has the effect of keepin= g=20 electricity in the region in which it is generated rather than where it=20 might be needed most he said.=20 Ackerman said transportation costs which typically run from $2 to $8 per= =20 megawatt-hour are more significant now that overall prices have settled in= to=20 a $100 range.=20 They didn't mean as much to the suppliers when they were getting $400 per= =20 megawatt-hour Ackerman said.=20 He also said some of his members suspect the ISO made moves during power=20 alerts to artificially keep prices lower.=20 The FERC pricing regime sets nonemergency prices at 85 percent of the last= =20 full hour of a Stage 1 emergency. But this week the ISO twice went from a= =20 Stage 1 to a Stage 2 alert in less than an hour. That kept the nonemergency= =20 price cap in place at about $92 per megawatt-hour set back in May.=20 Some traders said the ISO is 'gaming the market' to keep the price lower= =20 Ackerman said. I have a few traders who think the price should be higher.= =20 The ISO rejected the charge of manipulation and said it continues to make i= ts=20 emergency declarations based on power supply and demand. The ISO also said = it=20 has not identified transportation costs as a problem under the FERC order.= =20 Other energy experts however said the FERC system of using the most=20 inefficient power plants to set emergency prices was a mistake.=20 Frank Wolak a member of the ISO's market monitoring unit and a Stanford=20 University economist said the plan invited energy companies to keep their= =20 least efficient plants in operation to ensure the highest prices.=20 But James Sweeney also a Stanford professor and energy expert said he=20 preferred the FERC plan to a rigid market price cap.=20 Consumer advocate Doug Heller of the Foundation for Taxpayer & Consumer=20 Rights said the FERC plan is too complex and urged a return to a regulated= =20 system which pays generators for their production costs plus a reasonable= =20 profit. Gov. Gray Davis supports a similar approach.=20 Arthur O'Donnell editor of California Energy Markets saw much of the=20 maneuvering this week as an industry road test of new price regime.=20 I think they were testing the boundaries O'Donnell said. This is the we= ek=20 where we test the bugs in the system.=20 Copley News Service correspondent Toby Eckert and The Associated Press=20 contributed to this report.=20 Renewable energy fades from picture in rush for solution=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 July 4 2001=20 SACRAMENTO -- The electricity crisis is putting the squeeze on the renewabl= e=20 energy industry: the power plants that use the sun wind or underground hea= t.=20 The environmentally friendly alternative energy provides about 12 percent = of=20 the state's power. But the energy crunch and the state's effort to resolve = it=20 could end up shrinking the role of renewable energy in the coming years jus= t=20 as backers were hoping to see it expand.=20 For example:=20 ?Long-term power contracts obtained by the state to reduce costs will cover= =20 most state needs for a decade. Nearly all of the contracts are with natural= =20 gas-fired plants reducing the long-term market for new renewable plants.= =20 ?The uncertainty and lack of payment resulting from the crisis have slowed= =20 the development of renewable plants under an incentive program created as= =20 part of the state electricity deregulation plan.=20 ?Regulators are poised to prevent marketers from selling electricity=20 including green power from renewable sources directly to customers. A=20 large base of ratepayers must stay in the state program to pay off a power= =20 bond of up to $13.4 billion over 15 years. The state Public Utilities=20 Commission yesterday for the second time put off a decision whether to=20 curtail such direct access.=20 State and federal programs had been encouraging renewable energy to reduce= =20 dependency on the new wave of relatively clean and efficient natural-gas=20 power plants. The cost of electricity from those plants could go up if the= =20 demand for gas outpaces supply.=20 Renewable energy with the exception of some biomass plants also avoids th= e=20 pollution problems of power plants fueled by oil and coal -- not to mention= =20 the safety and radioactive waste-disposal problems of nuclear power.=20 A spokesman for a coalition of renewable generators and environmental group= s=20 said he thinks renewable energy has suffered during the electricity crisis= =20 because of a lack of attention not a shift in state policy.=20 I think the renewables are an unintended casualty said V. John White of= =20 the Center for Energy Efficiency and Renewable Technologies.=20 The state became a major player in the power equation in January when it=20 began buying power for debt-ridden utilities.=20 State officials say they would like to have a mix of power to spread the ri= sk=20 if something goes wrong with one source. For example soaring natural gas= =20 prices last winter were part of the reason for the high cost of electricity= .=20 In a trade-off the state scrambled to obtain long-term contracts that woul= d=20 lower the price of electricity now in exchange for prices that are expected= =20 to be above the market in the years to come.=20 The 38 contracts worth $43 billion over the next decade will help finance= =20 the construction of gas-fired power plants. About 70 percent of the power= =20 will come from plants that have not yet been built.=20 Only four of the contracts are for renewable power and their 120 megawatts= =20 is a tiny fraction of the total amount of power now under state contract. A= =20 megawatt can provide power for 750 to 1000 homes.=20 We agree the portfolio is lopsided and should be more diverse than it is= =20 Ray Hart head of the power purchasing unit in the state Department of Wate= r=20 Resources told the Senate Energy Committee last month.=20 The state has agreements in principle on an additional 19 contracts for 12= 70=20 megawatts from renewable sources. Most of the power 1172 megawatts would= =20 come from wind generation.=20 Anything could happen said Oscar Hidalgo a Water Resources spokesman. = It=20 could increase or decrease depending on what gets signed.=20 One renewable generator CalEnergy said the state rejected its offer to=20 provide 340 megawatts from a geothermal plant in the Imperial Valley for 20= =20 years at 6.9 cents per kilowatt-hour a price that is said to be the 10-yea= r=20 average of the state contracts.=20 We were astonished said Jonathan Weisgall CalEnergy vice president.=20 Hidalgo said state power purchasers don't recall the specifics of the=20 CalEnergy offer. He said the proposal may have been rejected because of its= =20 length the time of the power delivery or other reasons.=20 They may have to regroup restructure repackage and look for what we=20 want Hidalgo said.=20 Under deregulation part of monthly ratepayer bills were earmarked for a fu= nd=20 to encourage renewable energy sources. The fund provides five-year incentiv= es=20 of up to 1.5 cents per kilowatt hour.=20 The state held auctions in 1998 and again last summer that awarded $202=20 million in incentives for dozens of new small renewable plants that could= =20 produce about 1000 megawatts. The average incentive was .4 cents per=20 kilowatt hour.=20 But at this point said Marwan Masri of the California Energy Commission= =20 only plants capable of producing 180 megawatts have been completed.=20 There is the overall issue of who will buy the power said Masri and at= =20 what price and for how long.=20 A firm that specialized in marketing green power from renewable sources f= or=20 the environmentally conscious has taken a double hit from the electricity= =20 crisis.=20 Green Mountain Energy of Austin Texas. sells power to customers in a part= =20 of deregulation that is often called direct access which bypassed=20 utilities and later the state after it began buying power for utility=20 customers.=20 The firm canceled contracts with 50000 customers because the price was=20 indexed to the state Power Exchange which went bankrupt last spring after= =20 the debt-ridden utilities defaulted on their debt.=20 Green Mountain still has contracts with about 7000 customers in San Diego= =20 County who receive power under contracts at a fixed rate 8.5 cents per=20 kilowatt-hour.=20 The state Public Utilities Commission is still expected to prohibit future= =20 direct-access contracts a step directed by the legislation authorizing the= =20 state to buy power for utility customers.=20 That was the second blow to us said Rick Counihan of Green Mountain. It= =20 meant that we couldn't go out and buy a block of fixed-price power to sell = to=20 customers.=20 The ban on direct-access contracts is vigorously opposed by business groups= =20 who say that direct access would lower the cost of doing business in=20 California.=20 But supporters of the direct-access ban say that if customers bypass the=20 utilities the remaining ratepayers will be stuck with paying off a bond of= =20 up to $13.4 billion that is expected to be issued in September for power=20 costs.=20 Despite the problems some representatives of the renewable energy industry= =20 are optimistic about its potential for growth in the future.=20 A lot of the market is being served by rapidly aging power plants that=20 should be replaced said Jan Smutny-Jones of the Independent Energy=20 Producers. I think we also are going to see additional demand.=20 Moreover state government may take more steps to encourage the renewable= =20 industry.=20 The Energy Commission is proposing a goal for the incentive program that=20 would increase the amount of power coming from renewable sources to 17=20 percent of the total by 2006 up from 12 percent.=20 State Sen. Byron Sher D-Stanford has introduced a bill SB 531 that woul= d=20 set a goal of increasing the renewable share of state power to 20 percent b= y=20 2010. SDG&E spreads word of looming blackouts=20 By Jeff McDonald=20 UNION-TRIBUNE STAFF WRITER=20 July 4 2001=20 While power supplies dwindled and the likelihood of blackouts loomed San= =20 Diego Gas & Electric Co. for the first time yesterday was able to warn=20 customers in advance that they might go dark.=20 Under increasing pressure from businesses and residents SDG&E launched a n= ew=20 system to notify customers by pager and e-mail whenever the state declares= =20 supply emergencies that might lead to blackouts.=20 Some 5000 customers signed up for the warnings which ended up being false= =20 alarms by midafternoon when the Independent System Operator which manages= =20 the state's electricity grid was able to find enough megawatts to avoid th= e=20 first blackouts since May.=20 This at least gives people the opportunity to make a switch over to backup= =20 generation to power down essential equipment or to back up critical files= =20 SDG&E spokesman Ed Van Herik said.=20 It's definitely an improvement but we'll certainly look for ways to=20 increase the effectiveness of the notification process.=20 Even so the warnings from SDG&E came barely an hour before the ISO was=20 expected to issue a Stage 3 power alert meaning that demand had climbed to= =20 within 1.5 percent of available supplies. As it turned out the state never= =20 rose above a Stage 2 alert.=20 As the threat of blackouts continues to vex state power officials early=20 warnings about potential outages have become a key issue for businesses and= =20 residents who rely on uninterrupted service.=20 During blackouts earlier this year darkened traffic lights caused numerous= =20 accidents people were stranded in elevators and business owners complained= =20 of losses that could have been minimized.=20 Regular notification is a good idea said Samuel Ingersoll-Weng of the Sa= n=20 Diego Community Technology Group which works with hundreds of local=20 organizations to promote computer literacy.=20 It would be very helpful in terms of scheduling staff canceling or holdin= g=20 classes and also to protect equipment from power spikes or suddenly being= =20 shut off he said.=20 For most of the year SDG&E was telephoning a small number of such customer= s=20 on mornings they worried that demand for electricity might exceed supplies.= =20 But the problem is that when orders to pull megawatts from the grid come fr= om=20 the ISO the utility has only minutes to cut supplies and there has been=20 little time to warn people they may lose power.=20 Yesterday SDG&E was told 90 minutes ahead of time that a Stage 3 warning= =20 would likely be called at 3 p.m. The company issued the mass e-mails and=20 pages within 30 minutes.=20 Gov. Gray Davis announced plans this spring to provide neighborhoods 48-= =20 24-and 1-hour notices when blackout orders might be called. The ISO issued = no=20 such notice yesterday when it came the closest it had in weeks to ordering= =20 blackouts.=20 Ratepayers interested in signing up to be notified early of potential=20 blackouts can call the utility at (800) 411-SDGE.=20 Two more energy whistleblowers slated to come forward=20 By Don Thompson ASSOCIATED PRESS=20 July 4 2001=20 SACRAMENTO =01) Two more former workers at a San Diego-area Duke Energy pla= nt=20 are slated to talk with state investigators Thursday echoing concerns by= =20 other employees over how the plant was run when the state needed its power= =20 most.=20 However another former worker at the Chula Vista plant said he discarded= =20 perfectly good equipment three to five years ago while the plant was still= =20 owned by San Diego Gas and Electric.=20 Stuff that cost $3- to $5000 we were throwing away said Don Perkins of= =20 Alpine a mechanic at SDG&E plants for nearly 25 years.=20 That undercuts testimony from other former workers who told the Senate Sele= ct=20 Committee to Investigate Price Manipulation of the Wholesale Energy Market= =20 last month that they discarded valuable repair parts on the orders of Duke= =20 supervisors.=20 Like the other former SDG&E employees who have come forward Perkins was no= t=20 hired by Duke when it took over full operation of the plant in April. Perki= ns=20 said he is happy in retirement but like his former co-workers believes Duk= e=20 was driving up energy prices =01) which the company vehemently denies.=20 He and the three other former workers suggested Duke did not adequately=20 maintain its equipment leading to unnecessary repairs they said cut power= =20 generation and may have helped boost prices by cutting supply. That include= d=20 running a 15-megawatt jet-fuel fired turbine until it broke down.=20 We ran the heck out of the plant you bet we didresponded Duke spokesman= =20 Tom Williams. But he said the plant had fewer outages under Duke's ownershi= p=20 than while it was owned by SDG&E.=20 Duke eventually had to completely rebuild the jet-fuel fired turbine=20 Williams said.=20 It ran more last year than the previous 37 years combined because the sta= te=20 needed the power Williams said.=20 An attorney for Lt. Gov. Cruz Bustamante who is to introduce the two new= =20 whistleblowers Thursday said they will echo their co-workers complaints th= at=20 maintenance slipped once Duke took over the plant.=20 Williams dismissed the news conference as a media event and the workers'= =20 complaints as old news the company has rebutted since the earlier testimony= =20 before the committee.=20 Disabled PG&E employees ask state for help in getting disability checks=20 ASSOCIATED PRESS=20 July 4 2001=20 SAN FRANCISCO =01) After not receiving checks for work-related disabilities= for=20 months more than 200 Pacific Gas and Electric Co. employees have asked the= =20 state to take over their disability payments.=20 The employees stopped getting checks after Pacific Service Employees=20 Association sent them a letter saying it did not have enough funds. Until= =20 this year the association had paid almost all of PG&E's disability claims.= =20 PG&E said it has no legal responsibility to help the disabled workers and= =20 blames the employee association. But workers waiting for their payments=20 disagree.=20 The association and PG&E are one and the same A.J. Cavallaro an=20 electrical engineer with PG&E for 25 years who is on disability leave due t= o=20 a sleep disorder told the San Francisco Chronicle.=20 Originally created by PG&E workers to organize social events the associati= on=20 has its own board of directors and is legally separate from the utility and= =20 its parent company. The association began offering a short-term disability= =20 plan to PG&E workers in 1949.=20 Pacific Service transferred its members to the State Disability Insurance= =20 plan on Jan. 1. But about 230 PG&E workers decided to stay with the=20 association's plan after they were told they would continue to receive thei= r=20 disability checks.=20 Mike Colon the association's general manager filed an appeal with the=20 California Unemployment Insurance Appeals Board for the state to take over= =20 the group's payments.=20 Ralph Hilton chief counsel for the appeals board in Sacramento said that = if=20 the board decides the state should take over the payments checks would be= =20 issued within days of the ruling.=20 Workers may have to wait until August for the case to be heard.=20 National Desk=20 THE NATION Powerful Judge Illuminates Energy Practices Law: 'Folksy' jurist= =20 72 stuns utility executives and lawyers alike with his courtroom=20 incisiveness. RICARDO ALONSO-ZALDIVAR ?=20 07/05/2001=20 Los Angeles Times=20 Home Edition=20 Page A-12=20 Copyright 2001 / The Times Mirror Company=20 WASHINGTON -- The silver-haired judge handling federal negotiations on=20 refunds for alleged overcharges by power generators in California is often= =20 described as a Southern gentleman.=20 But Curtis L. Wagner Jr. can lose the folksy charm in a New York minute.=20 Wagner chief judge of the Federal Energy Regulatory Commission showed his= =20 knack for cutting through nonsense when he tangled with a smooth energy=20 company executive in his hearing room in May. The executive confidently=20 insisted he didn't need his boss' approval to enter into a $39-million=20 natural gas transportation deal.=20 Wagner didn't buy it.=20 I'm appalled that you're trying to pull this over my eyes intoned the=20 judge stunning a courtroom of high-priced lawyers into catatonic silence.= =20 Just answer my question . . .=20 Did you get approval . . . whether you got it after the meeting whether y= ou=20 got it the day before whether you got it in the head while you were both= =20 relieving yourselves?=20 Added Wagner owner of a 32-foot sailboat named Hizzoner: The head for= =20 non-boating people is the restroom.=20 Visibly squirming the witness acknowledged that his boss had in fact OKd= =20 the deal.=20 That kind of mettle prompted FERC's governing board to assign the overcharg= e=20 settlement case to the 72-year-old judge who likes to stay in shape by=20 attending early-morning aerobics classes in the agency's exercise room. I= =20 think Judge Wagner is the toughest tool in our toolbox said FERC=20 Commissioner Patrick H. Wood III.=20 Expectations are low that anybody can bridge the chasm between California a= nd=20 electricity generators and marketers with the state alleging it was gouged= =20 by $9 billion and the companies muttering about governmental extortion.=20 There are some very large numbers being talked about which makes it=20 unlikely that the companies would want to agree to a settlement said Kit= =20 Konolidge an electricity industry analyst with Morgan Stanley in New York.= =20 But in an interview Wagner said he feels pretty good about the chances. = I=20 never give up until the very end. With these things it looks impossible a= nd=20 then all of a sudden it comes together.=20 FERC the equivalent of a national utility commission is also dangling som= e=20 carrots in front of the parties. Along with refunds Wagner is trying to ge= t=20 a deal on long-term contracts for power and guarantees that the generators= =20 which are owed hundreds of millions of dollars will be paid.=20 The commission set a short time frame for the negotiations which are to=20 conclude Monday. If a settlement is not reachable FERC would impose its ow= n=20 solution. A mandated settlement is likely to be challenged in federal court= =20 where it could bog down for years.=20 FERC employs more than a dozen administrative law judges like Wagner to hea= r=20 disputes involving the companies it regulates. While presiding over the=20 closed-door settlement talks Wagner has traded his robes for a business=20 suit.=20 He has come down from the bench and sits at a table eye-level with more th= an=20 140 lawyers in his hearing room. There's a lot of billable hours there h= e=20 said.=20 The lawyers have been sorted into three big working groups representing=20 state agencies power sellers and energy marketers. The negotiations are=20 expected to intensify this week and participants said Wagner admonished al= l=20 sides on Friday to be ready to deal or face summary judgment from the FERC= =20 commission.=20 The judge has been variously quoted as saying that $1 billion $2 billion o= r=20 $2.5 billion might be an appropriate total refund. None of those [figures]= =20 are really attributable to me. I did make a statement--and I probably=20 shouldn't have--that it was probably less than $9 billion. Of the $9 billi= on=20 in overcharges claimed by the state only $5.4 billion is attributable to= =20 sellers within FERC's jurisdiction.=20 James J. Hoecker immediate past FERC chairman in the Clinton administratio= n=20 said that in 23 years as chief judge Wagner has built a reputation for=20 making things happen in difficult situations.=20 What is behind that is a lot of years on the bench and a certain amount of= =20 self-confidence Hoecker said. He has the ability . . . to move the parti= es=20 closer together. Sometimes that requires some fairly dramatic statements= =20 which are calculated to get people to feel the heat and get more creative= =20 about the flexibility they might have.=20 A senior FERC official said Wagner is like a pitcher who gets called from t= he=20 bullpen when the game is on the line. When things are tough we turn stuff= =20 over to Curtis said the official who asked not to be identified.=20 Wagner has had many big cases over the years on matters too arcane to garn= er=20 national attention.=20 He is handling a second major case before FERC. It involves allegations tha= t=20 Houston-based El Paso Corp. manipulated California 's natural gas market la= st=20 year thereby adding an estimated $3.7 billion to the state's energy costs.= =20 It was in that case that he grilled the executive.=20 Success in the California settlement negotiations would cap Wagner's 47th= =20 year as a government lawyer. The Tennessee native started at the Justice=20 Department on Aug. 2 1954. He got into regulatory law by representing the= =20 military in railroad disputes arising from the Korean War. After serving as= a=20 civilian lawyer for the Army for more than a decade he joined FERC's=20 predecessor agency in 1974.=20 But Wagner a widower doesn't dwell on his place in the annals of FERC. He= =20 tells agency employees he is working too many hours and missing his aerobic= s=20 classes.=20 Davis lauds California generator=20 Vote of confidence at Calpine's festival=20 Suzanne Herel Chronicle Staff Writer Thursday July 5 2001=20 2001 San Francisco Chronicle=20 URL:=20 /05/M N166801.DTL=20 Gov. Gray Davis took the stage at the San Jose America Festival yesterday a= nd=20 pledged to keep the lights on -- with the help of the Calpine energy=20 company which sponsored the fete.=20 You've heard me say some pretty tough things about out-of-state energy=20 companies trying to bleed us dry said Davis standing against the backdro= p=20 of a huge Calpine banner proclaiming Reliable Energy for a Brighter=20 Future.=20 Calpine is from California he said. They're going to make sure the ligh= ts=20 stay on.=20 Davis was a surprise guest sandwiched between musical acts Nina Storey and= =20 John Brown's Body during the daylong Fourth of July festival which feature= d=20 music food and vendors near the San Jose Airport.=20 The governor thanked the crowd of at least 1000 for joining other=20 Californians in conserving energy. Conservation surpassed the 10 percent ma= rk=20 statewide in May and June he said.=20 We could not get through the summer without you doing your part he said.= =20 Davis was introduced by Calpine chief executive Peter Cartwright -- whose= =20 multimillion-dollar stock option cash-in made news last month -- and San Jo= se=20 Mayor Ron Gonzalez who unsuccessfully opposed Calpine's planned 600-megawa= tt=20 Metcalf Energy Center in Coyote Valley.=20 In an interview after his appearance Davis countered criticism leveled at= =20 him this week by State Controller Kathleen Connell who accused him of=20 foolishly locking California into expensive long-term energy contracts.=20 You have to look at the total cost of electricity he said.=20 The state paid $109 million in May he said but that cost dropped to about= =20 $33 million last month.=20 Earlier yesterday after walking in the Redwood City Fourth of July parade= =20 Davis said that the price drop was a direct result of the long-term=20 contracts.=20 That would not have happened without the security and stability of long-= =20 term contracts he said. We did the right thing.=20 In San Jose he also said that the $15 million the state was paying=20 consultants to help negotiate power contracts was money well spent.=20 Before it was like the Yankees winning the World Series against the sandl= ot=20 baseball team he said. We're finally getting some stars on our team. = =20 E-mail Suzanne Herel at sherel@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 2=20 Activists stage anti-corporate march to power plant=20 GISELE DURHAM Associated Press Writer Wednesday July 4 2001=20 2001 Associated Press=20 URL:=20 tate2 024EDT0201.DTL=20 (07-04) 17:24 PDT LONG BEACH Calif. (AP) --=20 Consumer activists rallied against rising energy prices and pledged their= =20 independence from corporate tyrants amid Fourth of July celebrations=20 Wednesday.=20 About 200 people carrying signs reading public power not corporate=20 bailout and human need not corporate greed marched two miles from a loc= al=20 park in the Los Angeles suburb to the Alamitos generating station.=20 We feel we have been gouged and bled dry said Medea Benjamin founding= =20 director of Global Exchange a San Francisco-based consumer advocacy group.= =20 We've been treated the way tyrants treat their servants.=20 The protest was a joint effort of several national and local consumer=20 activist organizations. No arrests were made although dozens of police=20 officers were out in force for crowd control.=20 Earlier this week a federal judge issued a temporary restraining order=20 preventing the city from enforcing an ordinance that could have blocked the= =20 march.=20 The law requires organizers of public protests to give 30 days notice of th= e=20 event post an insurance bond and pay for police protection at the rate of= =20 $55 per hour for each officer.=20 At the plant organizers had intended to serve officials with a notice of= =20 seizure by eminent domain declaring the facility to be public property. Bu= t=20 nobody appeared at the front gate. The demonstrators posted the notice on t= he=20 chain-link fence and staged about a 40-minute rally before dispersing.=20 The symbolic notice was meant to emphasize the groups' discontent with=20 skyrocketing power prices during the past year the use of state budget mon= ey=20 for power purchases and the activists' desire to have the state take over= =20 power plants to stabilize market prices.=20 The money they're making off of us is criminal said Loni Baker one of t= he=20 marchers. They're greed is taking money away from our kids' schools.=20 Representatives of Arlington Va.-based AES Corp. which owns the plant d= id=20 not immediately return calls seeking comment.=20 Last month the U.S. Justice Department opened an antitrust investigation= =20 into a power sales partnership between AES and Williams Energy the Tulsa= =20 Okla.-based company that sells power for AES under an exclusive marketing= =20 agreement.=20 Both companies have denied wrongdoing but in May Williams agreed to refund= =20 $8 million after the Federal Energy Regulatory Commission accused of the=20 company of temporarily closing AES plants to drive up power prices.=20 Davis asks PUC to let utilities cut voltage=20 1% savings on energy consumption predicted=20 David Perlman Chronicle Science Editor Wednesday July 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N29133.DTL=20 Gov. Gray Davis asked the Public Utilities Commission yesterday to allow=20 electric companies to lower voltage levels on power lines delivering=20 electricity to consumers this summer.=20 The move will save about 1 percent in the state's electricity consumption= =20 the equivalent of building a new 500-megawatt power plant.=20 Lowering voltages by 2.5 percent will prove barely noticeable by domestic= =20 users who might see their incandescent light bulbs dim slightly.=20 Refrigerators and electric motors such as those that run air conditioners= =20 should operate more efficiently on the lower voltages experts said.=20 The move should save consumers about 1 percent on their electricity bills= =20 according to Energy Commissioner Arthur Rosenfeld.=20 With support already promised by the state's major power companies the PUC= =20 is expected to approve the change in its voltage rules within weeks Robert= =20 Kinosian energy adviser to PUC President Loretta Lynch said at a Sacramen= to=20 press conference.=20 Similar voltage decreases have gone into effect in several other states=20 during power emergencies in recent years Rosenfeld said. But this is the= =20 first time it will occur statewide throughout an entire period of peak powe= r=20 demand.=20 PUC rules now require power companies to deliver between 114 and 126 volts = to=20 consumers all the time.=20 Less than two months ago Bill Wattenburg a maverick engineer and longtime= =20 consultant to the Lawrence Livermore National Laboratory assembled a team = to=20 test the effects on lights appliances microwave ovens and motors operatin= g=20 at voltages that were lowered by 5 percent or more.=20 At the press conference yesterday Wattenburg said those tests -- conducted= =20 with utility company senior engineers -- showed that no devices were damage= d=20 nor was their performance impaired. But cooking food on electric ranges --= =20 whether boiling water or making a roast reach a given temperature -- would= =20 take longer and consume slightly more power under any lowered voltage he= =20 said.=20 John Ballance director of network engineering at Southern California Ediso= n=20 said his company is equipped to control its voltage levels electronically a= nd=20 can lower them as soon as the PUC approves the change.=20 But Pacific Gas & Electric Co. operates differently and will have to change= =20 its voltage levels at each of its 2400 substations individually -- a task= =20 that could take several weeks Rosenfeld said.=20 This proposal may well achieve new efficiencies and reduce electric bills= =20 for California ratepayers Davis said in a statement. I urge the PUC to= =20 give it serious consideration.=20 E-mail David Perlman at dperlman@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 13=20 Federal price limits backfire=20 Some generators withhold power rather than abide by rate caps=20 David Lazarus Chronicle Staff Writer Wednesday July 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N186091.DTL=20 Officials in California and Nevada after months of lobbying for federal=20 regulators to cap Western power prices warned yesterday that the newly=20 imposed limits have had the unintended consequence of increasing a threat o= f=20 blackouts in the two states.=20 The warnings were issued as California came within minutes of rolling=20 blackouts yesterday afternoon and one day after the first-ever rolling=20 blackouts in Las Vegas forced energy-hungry casinos to shut off fountains a= nd=20 reduce air conditioning.=20 The two states are asking the Federal Energy Regulatory Commission to take = a=20 closer look at the so-called price mitigation plan and come up with revisio= ns=20 that would deter power companies from withholding electricity during=20 shortages.=20 We need some clarity to this order said Oscar Hidalgo a spokesman for t= he=20 California Department of Water Resources which is spending billions of=20 dollars to keep the state's lights on.=20 Generators need to be held accountable he said.=20 The crux of the problem is that price limits kick in during shortages yet= =20 power companies say these caps force them to sell power at below-market rat= es=20 during periods of high demand.=20 Some companies have responded by holding back power rather than face the=20 expense of shipping electricity from state to state. Each mile that=20 electricity must be transmitted adds to the overall cost.=20 No one's going to pay for transmission if the cost is near the caps said= =20 Gary Ackerman executive director of the Western Power Trading Forum an=20 energy-industry association in Menlo Park.=20 Ackerman said several companies in his organization decided that there was = no=20 economic advantage to offering power in regional markets when price control= s=20 are in effect.=20 This means individual regions like California or Las Vegas could end up no= t=20 having enough Ackerman said. It increases the threat of blackouts.=20 BLACKOUT ALERT CANCELED California authorities issued a blackout alert at 1:45 p.m. yesterday when= =20 power reserves dipped to dangerously low levels. They canceled the alert=20 about an hour later after finding additional supplies.=20 Everyone in the West is fighting for megawatts said Stephanie McCorkle = a=20 spokeswoman for the California Independent System Operator which oversees= =20 the state's power network.=20 The Golden State's latest brush with lights-out conditions came a day after= =20 Nevada experienced its own rolling blackouts for the first time prompting= =20 heavy power users such as the MGM Grand and Caesars Palace to dim their=20 lights.=20 Don Soderberg chairman of the Nevada Public Utilities Commission said tha= t=20 the sudden power emergency took state authorities by surprise and that they= =20 are investigating to see what role the federal price limits may have had in= =20 exacerbating Monday's shortage.=20 We're looking very closely at this he said. There seems to be a potenti= al=20 for unintended consequences.=20 Specifically Soderberg said Nevada is focusing on operators of older less= -=20 efficient plants who would find profit margins shrinking if not vanishing= =20 under capped prices.=20 We're going to see how the caps might have played into this he said.=20 The federal ceiling in 10 Western states excluding California is about $9= 2=20 per megawatt hour. In California a 10 percent surcharge is added because o= f=20 the state's credit risk bringing the price to just over $101.=20 Ackerman at the Western Power Trading Forum said regional price controls ha= ve=20 extended California's power crisis to neighboring states.=20 California sneezed and the rest of the region caught the virus he said.= =20 'LAWYERS LOOKING FOR LOOPHOLES'=20 California and Nevada officials however said that they still have faith= =20 that price limits can stabilize Western electricity markets but that federa= l=20 regulators may have to tweak the system so that power companies cannot=20 withhold output.=20 The generators have banks of lawyers looking for loopholes (in the plan)= =20 said Hidalgo at the Department of Water Resources.=20 Unfortunately it may take some time for the regulators to revisit an issue= =20 that they took up only with the greatest reluctance. For months federal=20 regulators refused to impose price controls preferring instead to let supp= ly=20 and demand determine costs.=20 Hidalgo said that when it appeared that power companies were throttling bac= k=20 on output Monday California officials immediately dialed the hot line numb= er=20 provided by the Federal Energy Regulatory Commission in case of emergencies= .=20 No one answered he said. They were closed.=20 State officials tried again yesterday and this time were told that the=20 commission would look into the matter. They were not given a time frame for= =20 when the commission might come up with a response.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 Two more energy whistleblowers slated to come forward=20 DON THOMPSON Associated Press Writer Wednesday July 4 2001=20 2001 Associated Press=20 URL:=20 tate0 336EDT0118.DTL=20 (07-04) 00:36 PDT SACRAMENTO (AP) --=20 Two more former workers at a San Diego-area Duke Energy plant are slated to= =20 talk with state investigators Thursday echoing concerns by other employees= =20 over how the plant was run when the state needed its power most.=20 However another former worker at the Chula Vista plant said he discarded= =20 perfectly good equipment three to five years ago while the plant was still= =20 owned by San Diego Gas and Electric.=20 Stuff that cost $3- to $5000 we were throwing away said Don Perkins of= =20 Alpine a mechanic at SDG&E plants for nearly 25 years.=20 That undercuts testimony from other former workers who told the Senate Sele= ct=20 Committee to Investigate Price Manipulation of the Wholesale Energy Market= =20 last month that they discarded valuable repair parts on the orders of Duke= =20 supervisors.=20 Like the other former SDG&E employees who have come forward Perkins was no= t=20 hired by Duke when it took over full operation of the plant in April. Perki= ns=20 said he is happy in retirement but like his former co-workers believes Duk= e=20 was driving up energy prices -- which the company vehemently denies.=20 He and the three other former workers suggested Duke did not adequately=20 maintain its equipment leading to unnecessary repairs they said cut power= =20 generation and may have helped boost prices by cutting supply. That include= d=20 running a 15-megawatt jet-fuel fired turbine until it broke down.=20 We ran the heck out of the plant you bet we didresponded Duke spokesman= =20 Tom Williams. But he said the plant had fewer outages under Duke's ownershi= p=20 than while it was owned by SDG&E.=20 Duke eventually had to completely rebuild the jet-fuel fired turbine=20 Williams said.=20 It ran more last year than the previous 37 years combined because the sta= te=20 needed the power Williams said.=20 An attorney for Lt. Gov. Cruz Bustamante who is to introduce the two new= =20 whistleblowers Thursday said they will echo their co-workers complaints th= at=20 maintenance slipped once Duke took over the plant.=20 Williams dismissed the news conference as a media event and the workers'= =20 complaints as old news the company has rebutted since the earlier testimony= =20 before the committee.=20 2001 Associated Press ?=20 Davis seeking cheaper contracts=20 Posted at 10:33 p.m. PDT Wednesday July 4 2001=20 BY JOHN WOOLFOLK=20 Mercury News=20 California officials are asking energy companies for better deals on the=20 state's long-term power contracts as a way to settle a dispute over billion= s=20 of dollars in electricity costs from the past year Gov. Gray Davis said=20 Wednesday.=20 In closed-door Washington D.C. settlement talks scheduled to conclude=20 Monday state officials are demanding that energy companies forgo $8.9=20 billion in bills for electricity that the state argues was overpriced.=20 But Davis during a San Jose visit Wednesday said the state would consider= =20 accepting some of that refund in the form of cheaper long-term contracts a= =20 move that could appease critics who say the $43 billion deals cost far too= =20 much.=20 The governor's comments shed light on the state's bargaining strategy in th= e=20 negotiations. Few details have emerged from the talks since the judge=20 overseeing them imposed a gag order.=20 ``We've made suggestions we've offered various ways in which people could= =20 get us $8.9 billion'' Davis said. ``We've said it doesn't have to be all= =20 cash. You can give it to us in lower contract prices than you otherwise wou= ld=20 have given to us. You can renegotiate our existing contracts and save us=20 money. However you want to do it it's just got to net out to $8.9 billion.= ''=20 It's unclear how those offers have been received by energy suppliers who= =20 have insisted their prices were fair given the uncertainty over whether the= y=20 would ever get paid. Several major companies including Duke Energy and=20 Enron say they're owed millions of dollars from the state and its major=20 utilities.=20 Paula Hall-Collins a spokeswoman for Williams Companies which signed=20 several contracts with the state in February to deliver power over the next= =20 10 years said she could not comment.=20 But one industry official said it was encouraging to see the governor show= =20 some flexibility and that the concept seems reasonable.=20 ``We take that as a positive'' said Gary Ackerman executive director of t= he=20 Western Power Trading Forum a trade association. ``If he wants to talk som= e=20 trade-off in renegotiating the contracts that doesn't seem to be totally o= ut=20 of hand. We're not going to turn away any serious offer.''=20 But Ackerman said the state needs to give a little on its refund target.=20 The $8.9 billion a figure estimated by the state's power grid analysts for= =20 sales from May 2000 to May 2001 has been widely challenged by industry=20 leaders. Even the judge overseeing the settlement talks said it's probably= =20 too high.=20 ``I don't think it serves the state of California for the state to hold fas= t=20 to a number any more than it does for my members to do the same'' Ackerma= n=20 said. ``It just doesn't get to a solution. There's got to be some give and= =20 take and we certainly haven't heard that until now from the governor.''=20 The state began buying electricity in January for its largest utilities aft= er=20 they became so saddled with debt from high power prices that energy compani= es=20 refused to sell to them. The state has spent about $8 billion since then in= =20 daily and short-term purchases.=20 The Davis administration signed $43 billion worth of electricity contracts= =20 with 18 energy suppliers for power over the next 10 years and has dozens of= =20 deals pending. The contracts are aimed at lowering the amount of power the= =20 state has to buy in daily markets where prices have soared.=20 Davis has credited the contracts with lowering the state's power costs from= =20 $100 million a day or more in May to about $33 million a day. His chief=20 energy negotiator S.?David Freeman has said he's proud of the contracts.= =20 But Davis has faced blistering criticism about the deals from Republican=20 lawmakers state Controller Kathleen Connell and consumer advocates who sa= y=20 the contracts will soak consumers with high electricity prices for many=20 years.=20 Davis initially sought contracts at prices around $55 per megawatt-hour bu= t=20 the deals signed so far average $70 per megawatt-hour.=20 That was a bargain earlier this year when daily prices averaged more than= =20 $200 per megawatt-hour. But average daily prices have since fallen to $89= =20 during peak hours and as low as $56 during low-demand periods.=20 The average daily price in 1999 was about $30 per megawatt-hour.=20 If the state and power suppliers cannot reach an agreement by Monday they= =20 can request an additional 10 days. Otherwise the judge will recommend a=20 settlement and the five-member Federal Energy Regulatory Commission will vo= te=20 on it.=20 So far the two sides still seem far apart.=20 ``It's very very difficult'' said Davis who named the state's negotiator= s=20 to the Washington talks. ``We'll see on Monday whether or not agreements ar= e=20 made. My hope is that a settlement will be reached. It's possible one will= =20 be.''=20 Contact John Woolfolk at jwoolfolk@sjmercury.com or (408) 278-3410.=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Catch Up Body:: Joe Here it is david_cox@enron.net karen.owens@enron.com Gail evidently left Enron. Haven't seen her in ages. BTW P. Bibi resigned. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Lunch Break - You are speaking in 50M Dining Room. Body:: Per Mary Clark x37325 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: 2001 Electric Market Forecasting Conference Body:: Lee Thanks for your message. I am currently in London and shall contact you on my return to the States next week. I plan to attend your conference. Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Refund Cases Timelines--Confidential Atty Client Work Product Body:: Tim Per your request. Everybody else: please forward corrections/updates to me. Thanks Alan Comnes What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Possible letter to Eddington at BA Body:: Looks good to me. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: testimony Body:: Here it is. Peggy Mahoney@EES 09/12/2000 11:19 AM To: Karen Denne/Corp/Enron@ENRON Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron cc: Subject: testimony Can I plez have a copy of Steve's testimony from yesterday in San Diego? Thanks Peggy What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: ENE candlestick chart Body:: Greetings from London. What do you think about P TX DVN? Vince What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - RS041001 Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: possible RTP conference Body:: Dear Mr. Kaminski: Thank you for talking with me about a possible RTP conference. I would like to include some discussions of what has been learned in other industries. As I indicated Frank Wolak suggested that I contact you. In discussing power markets with Frank and other colleagues at Stanford and EPRI it seems quite evident that real-time pricing for retail customers is the forgotten resource in more efficient power markets. There seems to be a lot of confusion about what RTP means and it also seems that many researchers need to address some practical but important problems. I was asked whether a group like Stanford's EMF might explore this topic and give it the visibility that would have it considered more seriously by policymakers. Frank thought that you might be someone who could help me structure a useful approach and who might also see whether Enron could become a major sponsor. I was hoping that this issue was sufficiently important to Enron that the company might consider providing $25000. As you may appreciate it requires some thought and effort to make sure that the product of the conference is widely circulated among key government groups. I would be very interested in hearing from you if you can provide ideas and recommendations for people (perhaps yourself or a colleague) to participate. I would also appreciate any consideration by Enron of providing funding for this effort. Thank you Hill Huntington - retail notes.rtf Hillard G. Huntington EMF - an international forum on energy and environmental markets Voice: (650) 723-1050 408 Terman Center Fax: (650) 725-5362 Stanford University Email: hillh@stanford.edu Stanford CA 94305-4026 EMF Website: What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Advisory Council Meeting Body:: I have also received regrets from Horton but confirmation from Metts ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Barton substitute amendment Body:: Attached is from Andy Black of Congressman Barton's staff. This is the bill language and summary of changes to H.R. 1647 the Barton bill that will be marked up on Thursday that the chairman will offer by way of changes to the original bill text. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Thu evening Body:: Jody Thanks. Confirmed 8:30 Thu. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: President Clinton Press Release Body:: ----------------- What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: news/updates Body:: As to whether long term contracting by Cal. is a good idea the answer is somewhat mixed. We were one of the early parties pointing out the problems with total reliance on the spot market and encouraging more forward contracting. Given the utilities' precarious financial position there were two options: 1) outsource the default provider obligation to the market (this is what we prefer but there was no political support for it) or 2) have the state put its credit behind the purchases. California is pursuing the latter with CDWR prucahsing the utilities' requirements. In the short term we have criticized the state's plan because it contemplates state takeover of the grid state participation in power plant financing construction and ownership and they have not made it clear that CDWR really has the money to pay for all the purchases. I am attaching text I have used as the base for a number of communications with policymakers. Mark Schroeder@ECT 03/11/2001 02:11 PM To: Richard Shapiro/NA/Enron@Enron Steven J Kean/NA/Enron@Enron cc: Subject: news/updates In the press I saw two news stories that I wondered if we (Enron) had any role/hand in and what was the offical spin in both cases. 1) The FERC Order requiring something like 55-65 million dollars in refunds by generators (or did it include traders) for overcharging in California in December if I recall my facts/news stories correctly and 2) the reports of 40 companies entering into 10-year contracts with California (touted by Davis). Was Enron a contracting party? Do we think this is a good solution (I think I know the answer but defer to your lead on this so we stay on your message)? thanks mcs What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Privileged/Confidential -- Microsoft Lawsuit Body:: FYI particularly the part about the performance management system. Let's see what kind of data we can get about the Microsoft evaluation system to find the differences. Thanks. Michelle ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: States Power Grid Again Pushed to Brink of Rolling Blackouts Energy Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Energy Issues Body:: Miyung You seem to be finding these okay by yourself so I guess I don't need to be= =20 forwarding the articles I find to you anymore? I don't mind doing it but I can't see duplicating effort either! :--) Either way...let me know=20 Thanks! Joseph Miyung Buster@ENRON_DEVELOPMENT 04/25/2001 08:25 AM To: Ann M Schmidt/Corp/Enron@ENRON Bryan Seyfried/LON/ECT@ECT=20 dg27@pacbell.net Elizabeth Linnell/NA/Enron@Enron filuntz@aol.com James = D=20 Steffes/NA/Enron@Enron Janet Butler/ET&S/Enron@ENRON Jeannie=20 Mandelker/HOU/ECT@ECT Jeff Dasovich/NA/Enron@Enron Joe=20 Hartsoe/Corp/Enron@ENRON John =20 John Sherriff/LON/ECT@ECT Joseph Alamo/NA/Enron@Enron Karen=20 Denne/Corp/Enron@ENRON Lysa Akin/PDX/ECT@ECT Margaret=20 Carson/Corp/Enron@ENRON Mark Palmer/Corp/Enron@ENRON Mark=20 Schroeder/Enron@EnronXGate Markus Fiala/LON/ECT@ECT Michael R=20 Brown/LON/ECT@ECT Mike Mona L= =20 Petrochko/NA/Enron@Enron Nicholas O'Day/AP/Enron@Enron Peggy=20 Mahoney/HOU/EES@EES Peter Styles/LON/ECT@ECT Richard=20 Shapiro/NA/Enron@Enron Rob Bradley/Corp/Enron@ENRON Sandra=20 McCubbin/NA/Enron@Enron Shelley Corman/ET&S/Enron@ENRON Stella=20 Steven J Kean/NA/Enron@Enron Sus= an=20 J Mara/NA/Enron@Enron Mike Roan/ENRON@enronXgate Alex=20 Parsons/EU/Enron@Enron Andrew Morrison/LON/ECT@ECT lipsen@cisco.com Jane= l=20 Guerrero/Corp/Enron@Enron Shirley A Hudler/HOU/ECT@ECT Kathleen=20 Sullivan/NA/Enron@ENRON Tom Briggs/NA/Enron@Enron Linda=20 Robertson/NA/Enron@ENRON Lora Sullivan/Corp/Enron@ENRON Jennifer=20 Thome/NA/Enron@Enron jkradin@marathon-com.com=20 syamane@marathon-com.com=20 ken@kdscommunications.com hgovenar@govadv.com sgovenar@govadv.com=20 bhansen@lhom.com Carin Nersesian/NA/Enron@Enron cc: =20 Subject: Energy Issues Please see the following articles: Sac Bee Wed 4/25: State's credit takes hit Sac Bee Wed 4/25: Top energy adviser to quit as Davis pushes for plants= Sac Bee Wed 4/25: Senators offer bill to put a lid on power prices: Sen= .=20 Dianne Feinstein says there's a good chance the proposal can get out of committee Sac Bee Wed 4/25: Energy price gouging might end up felony Sac Bee Wed 4/25: Dan Walters: It's time for politicians to be honest= =20 about the energy crisis SD Union Wed 4/25: Bond-rating agency delivers reprimand downgrade SD Union Wed 4/25: FERC to weigh limited curbs on electricity prices SD Union Tues 4/24: Grid officials declare a Stage 2 alert SD Union (AP) Tues 4/24: Top credit agency lowers California's bond=20 rating LA TimesWed 4/25: State's Bond Rating Downgraded to A+ LA Times Wed 4/25: Price Controls Spark Deja Vu LA Times Wed 4/25: Davis Names Executive to Speed Construction of Power= =20 Plants in State LA Times Wed 4/25: Power Plant Emits Tons of Fumes LA TimesWed 4/25: Power Plant Plan Worries Neighbors SF Chron Wed 4/25: Federal plan called 'too little too late'=20 Limited price control seen as step in right direction but officials renew= =20 call for price ceiling SF Chron Wed 4/25: S&P lowers California's bond rating=20 First cut since '94 could cost taxpayers millions SF Chron Wed 4/25: Richard Sklar=20 Ex-Muni boss becomes energy czar=20 Davis' pick to oversee power plant construction SF Chron (AP) Wed 4/25: Will price caps deter investment as federal=20 regulators say? SF Chron (AP) Wed 4/25: Credit agency cites power troubles lowers=20 state's bond rating=20 SF Chron (AP) Wed 4/25: S&P downgrades California's bonds citing energy= =20 troubles=20 Mercury News Wed 4/25: State bond rating lowered Mercury News Wed 4/25: Q&A with Gov. Gray Davis on energy issues =20 (Opinions/Commentary) Mercury News (AP) Wed 4/25: Davis: Power surplus by 2003 Mercury News (AP) Wed 4/25: Great America to avoid blackouts OC Register Wed 4/25: State's bond rating is lowered The energy crisis brings an A+ designation which likely will mean higher= =20 borrowing costs =20 OC Register Wed 4/25: Fire stokes wholesale gas cost Individual.com (Business wire) Wed 4/25: Power Companies and Regulators= =20 Must Take=20 Steps To Avoid Spread of California Power Virus/ Andersen Analysis Individual.com(Business wire) Wed 4/25: Soaring Temperatures Produce Ca= ll=20 for Conservation California ISO Also Announces New Outage Notification System and On-call=20 Number --- State's credit takes hit=20 By Dale Kasler and John Hill Bee Staff Writers (Published April 25 2001)=20 Alarmed by the drain on California's treasury from more than $5 billion of= =20 electricity purchases a leading Wall Street credit agency lowered its rati= ng=20 on state bonds Tuesday.=20 Standard & Poor's downgraded California's credit rating by two notches a= =20 move that will increase the state's borrowing costs and illustrates a growi= ng=20 fear that the state's power expenditures could mushroom during a summer of= =20 blackouts and price spikes.=20 Although the state remains creditworthy S&P said it has less confidence in= =20 California's ability to repay its debts. It said the state could be=20 downgraded further if electricity purchases spiral out of control and the= =20 economy suffers because of blackouts.=20 This reflects the mounting uncertainty and the cost to the state of the=20 power purchases said S&P analyst Steven Zimmermann. The state is still= =20 strong -- it's just not as strong going forward.=20 Bond ratings are a benchmark of a state's finances and California official= s=20 have been proud of their ability to restore the state's ratings since they= =20 bottomed out during the recession and budget deficits of the mid-1990s. S&P= 's=20 downgrade is the first for California since July 1994 and comes as a slowdo= wn=20 in the high-tech industry adds to the budgetary anxiety caused by electrici= ty=20 costs.=20 Still Gov. Gray Davis' office downplayed the significance of S&P's decisio= n.=20 California's economy is still fundamentally strong period said Davis=20 spokesman Roger Salazar. We expect that in 2001 California will continue t= o=20 lead the nation in economic growth and job creation.=20 S&P lowered California from AA to A-plus status. That means California'= s=20 debt-payment ability has been reduced from very strong to still strong= =20 but somewhat more susceptible to the adverse effects of the changes in=20 circumstances and economic conditions.=20 While it won't directly hamper Davis' plan for solving the energy crisis t= he=20 downgrade increases the pressure on Davis to issue $10 billion to $15 billi= on=20 worth of bonds this summer as part of his rescue package.=20 The bonds are intended to replenish the state treasury as well as finance= =20 future power purchases. Since mid-January the state has committed $5.7=20 billion to buy electricity for troubled Pacific Gas and Electric Co. and=20 Southern California Edison. The commitment has chewed up a significant=20 portion of a budget surplus estimated by state Treasurer Phil Angelides at= =20 nearly $6 billion Davis and other state officials have pegged the surplus = at=20 $8 billion.=20 Either way it's clear that the power expenditures have left Wall Street an= d=20 many state officials nervous. S&P and other rating agencies have had=20 California on a ratings watch for some time signifying that a downgrade= =20 was possible.=20 The fact is that the state's credit rating and financial strength will=20 continue to be in jeopardy until the state's general fund is repaid for=20 energy costs said Angelides who's responsible for selling the bonds.=20 We have to get the general fund out of the business of purchasing energy.= =20 (The budgetary drain) will begin to affect very dramatically the ability of= =20 the state to provide for core programs from education to health care to=20 public safety.=20 Angelides spent much of the day urging legislators to pass legislation to g= et=20 the bond offering rolling.=20 The Legislature already authorized the bonds but Angelides said it must do= =20 so again because PG&E and Edison are challenging the formula the state has= =20 developed for bond repayment. The bond will be repaid with money from a rat= e=20 hike passed by state regulators but PG&E and Edison say the repayment=20 formula will siphon too much money from their coffers.=20 Angelides said lawmakers must quickly pass the new bill -- which requires a= =20 two-thirds majority -- or he might miss a make-or-break May 8 deadline for= =20 closing on a crucial $4.1 billion bridge loan. That loan is designed to tid= e=20 the state over until the bonds are sold later this summer. But the lenders= =20 won't fork over the funds until they're assured the bonds will be sold=20 because the state will use the bond proceeds in part to pay off that loan = he=20 said.=20 Ironically the sale of those bonds won't be hurt by the S&P downgrade=20 because customer revenue instead of taxpayer dollars are being used to pay= =20 them off analysts said.=20 What's important for the bonds is how the (utility) rates are structured t= o=20 pay them off said analyst Susan Abbott of Moody's Inc. in New York.=20 But the downgrade will raise the interest rate on a host of other bonds=20 issued by the state in the coming months. The likely increase is as much as= =20 one-quarter of 1 percent said chief economist Ted Gibson of the state=20 Department of Finance.=20 With the state authorized to sell $12 billion worth of general obligation= =20 bonds the downgrade could add $50 million to $100 million in borrowing cos= ts=20 over the life of those bonds Angelides said.=20 The S&P action also could raise a red flag to anyone thinking of investing = in=20 a public or private-sector project in California.=20 It will create perception issues about who we are and where we are in term= s=20 of the economy of the state Angelides said. The real issue here is the= =20 reputational damage to the state of California.=20 The two other leading credit agencies Moody's and Fitch Investors Service= =20 still have California on a credit watch but haven't issued downgrades.=20 S&P acted the same day the Independent System Operator which manages=20 California's power grid declared a Stage 2 power alert. Warm weather and t= he=20 unexpected shutdown of two key power plants caused electricity reserves to= =20 fall below 5 percent.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m.=20 Bee Deputy Capitol Bureau Chief Dan Smith contributed to this report. --- ------------------------ Top energy adviser to quit as Davis pushes for plants Bee Capitol Bureau (Published April 25 2001)=20 John Stevens Gov. Gray Davis' staff director and top energy adviser is=20 leaving the governor's office at the end of the week Davis announced=20 Tuesday.=20 Stevens of Carmichael joined the administration a year ago as staff=20 director after working 13 years as a top staffer in the Legislature=20 including a stint as chief of staff to former Assembly Speaker Antonio=20 Villaraigosa.=20 He is the second top Davis adviser to leave in the past two weeks as the=20 Democratic governor struggles to deal with California's energy woes.=20 Like Phil Trounstine the governor's communications director who announced= =20 his resignation two weeks ago Stevens said he needed more time with his=20 family.=20 It's an immense issue he said of the energy crisis. I've given what I c= an=20 to it and I need to take a break.=20 Davis called Stevens 54 one of the most dedicated and loyal people that= =20 I've ever had working for me but acknowledged long hours and intensity to= ok=20 its toll.=20 This is tough work. This wears people out Davis said. He's so self-driv= en=20 that he needs a break but I venture a guess that down the road he'll be= =20 willing to come back and help us in some meaningful way on this energy=20 situation.=20 Davis also announced the appointment of Richard Sklar to head a Generation= =20 Implementation Task Force intended to speed up permitting and constructing= =20 power plants.=20 Sklar was the Clinton administration's representative in southeast Europe= =20 helping to rebuild war-torn Bosnia and Kosovo. --- ------------------------ Senators offer bill to put a lid on power prices: Sen. Dianne Feinstein say= s=20 there's a good chance the proposal can get out of committee. By Les Blumenthal Bee Washington Bureau (Published April 25 2001)=20 WASHINGTON -- West Coast senators formally introduced legislation Tuesday t= o=20 temporarily cap wholesale electric rates and expressed hope that their=20 proposal to ease the huge run-up in energy prices might clear the committee= =20 and make it to a vote on the Senate floor.=20 I think we are very close to having the votes in committee Sen. Dianne= =20 Feinstein D-Calif. said of the Energy and Natural Resources Committee tha= t=20 has jurisdiction over the bill. I am taking nothing for granted but the= =20 committee is 50-50.=20 There are 11 Democrats and 11 Republicans on the committee including=20 Feinstein and the other primary sponsor of the bill Oregon Sen. Gordon=20 Smith.=20 Smith a Republican is the swing vote.=20 Feinstein said the committee chairman Sen. Frank Murkowski R-Alaska has= =20 shown an increasing willingness to help her and Smith move the legislation= =20 though some differences remain.=20 He (Murkowski) has told me he'd like to help Feinstein said. I think we= =20 are very close to a markup and this could move quickly.=20 Murkowski did not rule out price caps but said he thought the bill sacrific= ed=20 long-term solutions for short-term gains.=20 I have concerns about the proposal put forward today and the impact it may= =20 have in distorting the market he said. It is time to address the=20 underlying causes -- not just the symptoms.=20 Feinstein's comments came at a news conference during which she Smith=20 Washington state Democratic Sens. Patty Murray and Maria Cantwell and New= =20 Mexico Sen. Jeff Bingaman the ranking Democrat on the Senate Energy=20 Committee unveiled details of the bill and criticized the Bush=20 administration and federal regulators for failing to take action to cap=20 rates.=20 If approved by Congress and signed by President Bush the bill would give t= he=20 Federal Energy Regulatory Commission 60 days to impose price caps or set up= a=20 cost-based rate structure that would allow electricity generators to recove= r=20 their costs and earn a fair return.=20 The controls would apply in 11 Western states including California Oregon= =20 and Washington. Similar legislation has been introduced in the House of=20 Representatives.=20 The lawmakers said the price controls would remain in effect until March=20 2003 when they said enough new generating plants will have come on line = to=20 overcome the West's current electricity shortage.=20 Under federal law FERC has the authority to ensure wholesale rates are jus= t=20 and reasonable.=20 Feinstein said that during a warm day this summer California may fall 2000= =20 megawatts short of meeting demand and on a hot day with air conditioners=20 cranked up there could be a 10000-megawatt shortfall.=20 Feinstein said that in 1999 California utilities paid $7 billion for=20 electricity in 2000 more than $32 billion and according to some estimates= =20 the price tag could reach $65 billion this year.=20 There has been a very strong element of price gouging in this Feinstein= =20 said.=20 We should not have to pass legislation to compensate for a federal agency= =20 not doing its job Murray said adding that Northwest utilities were payin= g=20 the highest prices in the country for next-day delivery of wholesale power.= =20 This (bill) will bring the market under control until new generation comes= =20 on line.=20 Cantwell who is also a committee member said wholesale rates have risen= =20 11-fold over the past several months resulting in thousands of layoffs in= =20 the region and the shutdown of the aluminum industry.=20 We cannot allow our government to sit idly by and allow a tragically flawe= d=20 and easily manipulated power market to wreak havoc on our economy and quali= ty=20 of life Cantwell said.=20 The Bonneville Power Administration has indicated it may have to raise its= =20 wholesale rates by 250 percent this fall as it is forced to buy power on=20 expensive spot markets because a severe drought in the Pacific Northwest ha= s=20 reduced electricity production at the region's vast hydropower system. BPA= =20 supplies 45 percent of the Northwest's wholesale electricity.=20 Smith said that as a Republican he was initially reluctant to support pri= ce=20 control and would have preferred the market sort out its own problems.=20 But he said Hard-nosed business practices that generate big profits are= =20 not always good politics. It's a mistake to defend a system that some can= =20 game to make incredible profits.=20 The Oregon senator said he knew his decision to sponsor the bill was not=20 well-received at the White House.=20 I know I'm not making any friends down the street he said. It's importa= nt=20 to keep this bipartisan and I'm not going to attack the Bush=20 administration.=20 Both Smith and Feinstein said a FERC staff proposal to cap wholesale electr= ic=20 rates in California when rolling blackouts are imminent falls well short of= =20 what's needed. FERC will consider the proposal at a meeting today.=20 California is not the only state affected said Smith. This is not a=20 California problem alone.=20 Feinstein said the proposal was inadequate.=20 I'm not sure that is the right way to go she said. The only reason they= =20 are considering action is we are putting the heat on them.=20 The Bee's Les Blumenthal can be reached at (202) 383-0008 or=20 lblumenthal@mcclatchydc.com. --- ------------------------ Energy price gouging might end up felony By Emily Bazar Bee Capitol Bureau (Published April 25 2001)=20 Democratic lawmakers this week will unveil a proposal to make energy price= =20 gouging a felony -- punishable by stiff fines and possible jail time -- tha= t=20 could be subject to the state's controversial three strikes law.=20 The measure sponsored by Lt. Gov. Cruz Bustamante would punish companies= =20 that sell electricity or natural gas in California at unjust or unreasonab= le=20 rates.=20 There is a tremendous amount of wealth that is being transferred from=20 California to five companies mostly in Texas Bustamante said. If what= =20 they're doing isn't illegal it ought to be.=20 Though lawmakers are expected to introduce the measure Thursday it already= =20 has generated opposition from Republican lawmakers and constitutional=20 questions from legal experts.=20 Several aspects of the bill AB 67x are unresolved and could change.=20 But the intent will remain the same and energy companies that take advanta= ge=20 of Californians will still face significant penalties said the bill's=20 author Assemblyman Dennis Cardoza D-Merced.=20 According to a draft version of the bill and some proposed amendments a=20 corporation or a person with decision-making authority at the corporation= =20 would be found guilty of a felony if they collude or conspire to manipulat= e=20 the market to achieve unjust or unreasonable rates for electricity or natur= al=20 gas.=20 A state or federal regulatory agency -- such as the Federal Energy Regulato= ry=20 Commission -- would determine whether rates were unjust or unreasonable. If= =20 that happened the bill would open the door for prosecution by the state=20 attorney general or local district attorneys.=20 In addition if found guilty companies would be forced to pay restitution= =20 and could face fines as high as 10 percent of their gross corporate assets.= =20 Lawmakers are debating whether to make the felony a three strikes offense= =20 which requires 25 years to life sentences for some people convicted of thre= e=20 felonies.=20 Though the provision was in an early draft of the bill Cardoza said it's= =20 not likely to show up in the final version.=20 While I think this crime is every bit as abhorrent as going in and stealin= g=20 money from a bank we're going to have to figure out a little bit different= =20 way of dealing with it he said.=20 Even without the three strikes provision the bill raises certain=20 constitutional issues said Clark Kelso a professor at the McGeorge School= =20 of Law in Sacramento.=20 For instance he said it's not clear whether the state can legally base a= =20 fine on an out-of-state company's gross assets.=20 And the measure which requires a two-thirds vote for passage already has= =20 generated Republican opposition.=20 To the extent this bill is onerous toward power producers it may deter th= em=20 from selling here rather than risk fines and prison said James Fisfis a= =20 spokesman for the Assembly Republican Caucus. We haven't seen the details= =20 but it sounds like it may be a piece of legislation that goes too far.=20 The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com= . --- ------------------------ Dan Walters: It's time for politicians to be honest about the energy crisis (Published April 25 2001)=20 Gov. Gray Davis is continuing to tell Californians that he's on top of the= =20 state's energy crisis and as he said at one gathering last week in three= =20 years this problem will be a distant memory. Fat chance. All major aspect= s=20 of the situation are growing worse not better minute by minute.=20 Politicians took over the crisis in January as the state's major utilities= =20 exhausted their cash reserves and lines of credit. Davis began what he said= =20 then would be a short-term emergency program of power purchases to keep=20 electrons flowing into homes and businesses.=20 From that moment forward the situation has steadily deteriorated moving= =20 toward a three-pronged disaster: severe summer blackouts the bankruptcy of= =20 the utilities and sharply escalating power bills. With the bankruptcy filin= g=20 by Pacific Gas and Electric Co. and decisions by Davis and the state Public= =20 Utilities Commission to begin ratcheting up utility rates two of the three= =20 negative scenarios are now in place. And everyone involved in the crisis=20 expects blackouts this summer as demands for power soar and supplies dwindl= e.=20 The Davis strategy if there is one is to continue the state's massive pow= er=20 purchases while negotiating longer-term and presumably cheaper supply=20 contracts encourage conservation help utilities pay off their debts by=20 selling their intercity transmission system to the state and tapping=20 ratepayers and build more power plants to ease the supply crunch.=20 Currently the governor is touting his deal with Edison International pare= nt=20 company of Southern California Edison to sell its portion of the power gri= d=20 and is working on a similar deal with Sempra the parent of San Diego Gas &= =20 and Electric. But PG&E's bankruptcy filing casts doubt on the viability of= =20 the cash-for-grid concept and legislators particularly Davis' fellow=20 Democrats are very skeptical of the Edison deal.=20 Clearly Davis rushed into the Edison deal just three days after PG&E made= =20 its bankruptcy filing in hopes of erasing the political stain of the latte= r=20 action but its provisions are being labeled a bailout by critics. It place= s=20 only a token financial burden on Edison International while guaranteeing th= e=20 profitability of its utility subsidiary by charging its customers whatever = is=20 required to cover its costs and past debts.=20 Meanwhile the state is spending -- by Davis' own account -- about $70=20 million a day or $2 billion-plus a month on spot power purchases paying=20 roughly five times what consumers are being charged at the retail level. An= d=20 the futures market for power indicates that wholesale power prices will jum= p=20 50 percent by midsummer higher prices and greater purchases could increase= =20 the drain on the state treasury to as much as $5 billion a month.=20 State Treasurer Phil Angelides is desperately trying to arrange a bridge lo= an=20 to relieve pressure on the state's rapidly vanishing reserves but Wall=20 Street is reluctant to lend without a fuller explanation of what's happenin= g=20 and a specific authorization from a suspicious Legislature. Meanwhile=20 bankers are sending strong signals that the state government is becoming as= =20 poor a lending risk as the utilities.=20 Davis for some reason is unwilling to declare this situation the emergenc= y=20 that it is truly becoming -- one that could take a toll on human life if=20 major blackouts shut down air conditioners respirators and traffic lights.= =20 He insists on issuing his periodic -- and wholly unrealistic -- assurances= =20 that things will turn out all right even declaring to reporters on Tuesday= =20 We think we'll have this thing licked by the end of fall.=20 It's time for someone -- the governor preferably but someone -- to lay ou= t=20 for Californians exactly what's happening the downside financial and power= =20 supply risks and what's being done to deal with the looming disaster facin= g=20 this state. It's time for politicians to treat us as adults who can face=20 reality not as children to be fed sugar-coated sound bites and slogans.=20 The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.c= om . --- ------------------------ Bond-rating agency delivers reprimand downgrade=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 April 25 2001=20 SACRAMENTO -- An influential Wall Street firm yesterday gave Gov. Gray Davi= s=20 and the Legislature poor marks for handling the electricity crisis=20 downgrading state bonds because of the drain on the state treasury and=20 warning of long-term damage to the state economy.=20 The bad news from Standard & Poor's came as state Treasurer Phil Angelides= =20 urged the Legislature to pass a bill this week needed to begin repaying the= =20 state general fund with a bond of $10 billion or more.=20 The bond would be paid off by ratepayers over 15 years. From a small problem that could have been solved in a short period of time= =20 this is escalating into a big problem said David Hitchcock of Standard &= =20 Poor's. Even if they issue revenue bonds it could stay with them for a lo= ng=20 period of time.=20 Standard & Poor's lowered its rating on state of California general=20 obligation bonds from AA to A+ which means it will cost the state more to= =20 borrow money.=20 The firm left California on credit watch with a negative outlook a ranking= =20 applied after the state began buying power for utility customers in January= .=20 The state general fund has spent more than $5 billion buying power so far.= =20 There are predictions that spending will sharply increase this summer as he= at=20 drives up the demand for electricity.=20 The fact is we can't allow the general fund to be depleted Angelides=20 said. There are limits to it. It will begin to affect very dramatically th= e=20 ability of the state to provide core programs for education health care= =20 public safety.=20 Developments:=20 WEDNESDAY:=20 =01) No power alerts are called in the early morning as electricity reserv= es=20 stay above 7 percent.=20 =01) The state Public Utilities Commission continues hearing energy experts= =20 evaluate ideas for implementing a recent rate increase. The panel includes= =20 George Sterzinger a Washington-based renewable energy consultant Peter=20 Bradford an energy and regulatory adviser and Severin Borenstein directo= r=20 of the University of California Berkeley's energy institute.=20 =01) Assembly Energy Committee holds a hearing on Gov. Gray Davis' proposal= to=20 keep Southern California Edison out of bankruptcy.=20 TUESDAY:=20 =01) Gov. Gray Davis says California will build enough power plants by 2003= to=20 end the state's power crisis and have a 15 percent supply surplus by 2004.= =20 He names former U.S. diplomat Richard Sklar to be the state's new energy cz= ar=20 and head a Generation Implementation Task Force to speed up power plant=20 siting and construction.=20 =01) The Independent System Operator which runs the state's power grid=20 declares a Stage 2 alert meaning the state is within 5 percent of running= =20 out of power. It warns rising temperatures could create problems later this= =20 week unless Californians conserve electricity.=20 =01) Standard and Poors lowers its rating on California state bonds citing= the=20 growing financial drain from the continuing energy emergency. The state mus= t=20 quickly replenish its coffers if it is to avoid further damage the rating= =20 agency says.=20 WHAT'S NEXT:=20 =01) Davis' representatives continue negotiating with Sempra the parent co= mpany=20 of San Diego Gas and Electric Co. to buy the utility's transmission lines.= =20 Davis says he expects to have an agreement within two weeks.=20 =01) Senate Select Committee to Investigate Price Manipulation of the Whole= sale=20 Energy Market continues its investigation Thursday.=20 Standard & Poor's said that if the sale of a state revenue bond is delayed= =20 the potential impact on the state general fund could be severe without a= =20 rate hike much larger than the increase of more than 40 percent approved by= =20 the state Public Utilities Commission last month.=20 Rate increases appear difficult in the present political environment and= =20 related voter initiatives although none are currently on the ballot remai= n=20 a possibility said Standard & Poor's.=20 The state began buying power after the two largest utilities Pacific Gas a= nd=20 Electric and Southern California Edison were nearly bankrupt. The rates th= ey=20 could charge customers were frozen under deregulation as the cost of=20 wholesale power soared producing a debt of $13 billion.=20 Standard & Poor's said the state expected in January to spend less than $1= =20 billion and resolve the problem in a few months with long-term power=20 contracts at lower prices. But most of the contracts do not begin until thi= s=20 fall or later.=20 In addition said Standard & Poor's it is not unreasonable to expect pa= st=20 and future blackouts to affect business location decisions and hence the= =20 ultimate direction of the state's economy.=20 A spokesman for the governor said that Standard & Poor's view of how the=20 California economy will fare during the electricity crisis is far too dim.= =20 California's economy is still fundamentally strong said spokesman Roger= =20 Salazar. We expect that in 2001 we will continue to lead the nation in=20 economic growth and job creation.=20 Another Wall Street credit-rating firm Moody's has a more positive view o= f=20 how the governor and the Legislature have handled the crisis and expects th= e=20 state general fund to be repaid by the ratepayer bond.=20 We are still at our AA2 with a negative outlook said Ray Murphy Moody's= =20 vice president. Nothing that we have learned over the last week or so has= =20 led us to change that opinion.=20 Angelides said legislation is needed because PG&E and Edison are challengin= g=20 a PUC action last month that gives the state some revenue from monthly=20 ratepayer bills which is needed to finance the bond to repay the state=20 general fund.=20 The utilities say they need more of the ratepayer revenue.=20 The treasurer said the legislation would bypass the lengthy PUC process and= =20 authorize the state to issue a ratepayer bond of $10 billion or more. The= =20 governor said again yesterday that he believes a bond of $12.4 billion will= =20 cover state power costs this year.=20 Angelides said legislation is urgent because a commitment from three lender= s=20 to give the state a $4.1 billion short-term loan expires May 8.=20 He said the short-term bridge loan would ease the strain on the state gener= al=20 fund until the main bond can be issued probably in late June.=20 The treasurer said that failure to obtain the short-term loan could lead to= =20 more credit downgrades and create perception issues about who we are and= =20 where we are in terms of the economy of this state.=20 Davis has been criticized on Wall Street for not pushing for an early rate= =20 hike to stabilize the utilities and avoid the need for the state to begin= =20 buying power.=20 The governor said earlier this year that he could have solved the problem i= n=20 20 minutes with a rate hike but refused to do so.=20 While addressing the California Chamber of Commerce yesterday Davis said= =20 that the long-term contracts will spread the cost of buying power over a=20 decade causing ratepayers to pay less than market rates in the early years= =20 and a little above the market rate in later years.=20 I do not want to shock this economy into recession Davis said. I do not= =20 want to burden small business with more than they can sustain.=20 Davis wants the state to purchase the transmission systems of the utilities= =20 in exchange for giving them part of the ratepayer revenue to finance a bond= =20 to pay off their debts. That would enable the utilities to resume buying=20 power by the end of next year.=20 But negotiations to buy the transmission systems has taken much longer than= =20 expected. PG&E filed for bankruptcy earlier this month and an agreement to= =20 buy the Edison transmission system announced a few days later faces=20 opposition in the Legislature.=20 Some legislators who think Edison receives too much under the complex=20 agreement have suggested that Edison join PG&E in bankruptcy where=20 generators accused of price-gouging may not have all of their bills paid.= =20 If they go into bankruptcy the state will be buying power for three or fo= ur=20 years Davis told the Chamber yesterday. That is all we will be doing up= =20 here.=20 A Stage 2 emergency alert was called yesterday when two power plants=20 unexpectedly stopped operating with temperatures around the state rising.= =20 Meanwhile Davis announced that Richard Sklar a former ambassador to the= =20 war-torn Balkans will lead a task force to speed up the construction of ne= w=20 power plants.=20 The governor acknowledged while speaking to reporters that he has not met h= is=20 earlier goals of avoiding blackouts rate increases and keeping the utiliti= es=20 out of bankruptcy.=20 This is probably the most complicated challenge the state has faced in 50= =20 years Davis said. But we are providing steady and reliable leadership a= nd=20 I believe we will have this thing behind us by the end of this fall.=20 --- --------------- FERC to weigh limited curbs on electricity prices=20 Caps would apply in Stage 3 shortages By Toby Eckert=20 COPLEY NEWS SERVICE=20 April 25 2001=20 CALIFORNIA'S POWER CRISIS=20 WASHINGTON -- Federal regulators are expected to consider limited wholesale= =20 price curbs for California's chaotic electricity market today but the=20 approach falls far short of the controls sought by many state officials.=20 Federal Energy Regulatory Commission staffers have proposed limiting the=20 price that power sellers can charge for wholesale electricity in California= =20 only during the most severe shortages known as Stage 3 emergencies. The=20 price mitigation would be pegged to the marginal cost of the=20 highest-priced (generating) unit called upon to run according to a staff= =20 report.=20 Producers also would be required to sell their excess power to the state's= =20 grid operator.=20 The price controls would last one year and would not apply to other Western= =20 states suffering from gyrations in power costs and electricity shortages.= =20 FERC Chairman Curtis Hebert has been an implacable foe of price controls b= ut=20 is under considerable political pressure to do more to help California as t= he=20 peak power-consuming summer months approach. Commissioner William Massey ha= s=20 advocated far-reaching price limits while Commissioner Linda Breathitt has= =20 wavered on the issue.=20 Gov. Gray Davis and other California officials have called for broad price= =20 controls that also would include 10 other Western states. Yesterday Sen.= =20 Dianne Feinstein D-Calif. formally introduced legislation that would=20 require FERC to impose regional price limits through March 1 2003.=20 Feinstein said the FERC staff proposal was inadequate.=20 Once you put the cap just on Stage 3 you force the heavier pricing on=20 stages 1 and 2 she said.=20 Other critics have noted that wholesale power prices in California are=20 abnormally high during periods other than Stage 3 emergencies.=20 Feinstein's legislation first outlined in March would require FERC to set= =20 price caps or impose cost-based rates that would limit prices to the cost= =20 of producing the power plus a set profit margin. New generating plants and= =20 power bought through long-term contracts would be exempt.=20 However any state covered by the price controls would have to allow=20 utilities to recover their wholesale power costs from consumers. The clause= =20 helped draw a Republican co-sponsor to the bill Sen. Gordon Smith of Orego= n.=20 Smith and other Western lawmakers have complained about the reluctance of= =20 California officials to raise retail rates while consumers in neighboring= =20 states have seen their power bills soar. In recent months the California= =20 Public Utilities Commission twice has increased rates for customers of=20 Southern California Edison and Pacific Gas and Electric the utilities hit= =20 hardest by skyrocketing wholesale power prices.=20 The FERC staff proposal rejected price caps or cost-based rates.=20 It would be hard to devise price caps that are low enough to provide price= =20 relief but high enough to adequately compensate generators the proposal= =20 said.=20 The Bush administration and top congressional Republicans are opposed to=20 price controls so it is uncertain how far Feinstein's legislation will get= .=20 --- Grid officials declare a Stage 2 alert=20 ASSOCIATED PRESS=20 April 24 2001=20 SACRAMENTO =01) The state's electric grid operator declared a Stage 2 power= =20 alert Tuesday after two power plants suddenly went offline.=20 Higher-than-forecasted temperatures in Southern California also caused dema= nd=20 to increase said Lorie O'Donley spokeswoman for the Independent System=20 Operator keeper of the state power grid.=20 A Stage 2 alert is declared when electricity reserves fall or are expected = to=20 fall below 5 percent.=20 The two power plants that went offline had been producing about 1080=20 megawatts or roughly enough power for 810000 homes.=20 We think we may need to request interruptible customers but barring any= =20 other big problems we probably won't need to go to a Stage 3 said=20 O'Donley. Stage 3 alerts are called when the reserves drop below 1.5 percen= t=20 and could result in rolling blackouts like the state has seen on four days= =20 since January.=20 The ISO said 9900 megawatts were unavailable Tuesday morning because of=20 power plants that were down for scheduled or unplanned maintenance. Another= =20 3000 megawatts from alternative generators such as solar wind and=20 geothermal was also not available O'Donley said.=20 About half of the alternative generators say they can't afford to keep=20 operating because they are owed about $1 billion by Pacific Gas and Electri= c=20 Co. and Southern California Edison.=20 --- Top credit agency lowers California's bond rating=20 ASSOCIATED PRESS=20 April 24 2001=20 SACRAMENTO =01) A top credit agency lowered its rating on California state = bonds=20 Tuesday citing the growing financial drain from the continuing energy=20 emergency.=20 The downgrade reflects the mounting and uncertain cost to the state of the= =20 current electrical power crisis as well as its likely long-term detrimenta= l=20 effect on the state's economy Standard and Poors said.=20 The state's ability to repay is debts has been reduced though it is still= =20 adequate S&P said.=20 It dropped the rating on general obligation bonds from double-A to=20 single-A-plus. It similarly revised other lease ratings and ratings for th= e=20 California Health Facilities Construction Loan Insurance Fund known as Cal= =20 Mortgage.=20 S&P said it didn't drop the rating farther because the state still has mone= y=20 because of California's diverse economy and because a proposed revenue bon= d=20 is slated to reimburse the state's treasury for money California is current= ly=20 using to buy power for two financially strapped utilities.=20 If the state can't quickly sell its revenue bond the impact on the treasur= y=20 could be severe unless electricity rates are substantially increased beyond= =20 the large increases already scheduled to kick in S&P warned.=20 S&P has had the state's general obligation bonds on a credit-watch with=20 negative implications since January when the state began buying power for= =20 Southern California Edison and Pacific Gas and Electric.=20 --- State's Bond Rating Downgraded to A+=20 Finance: Reduction of 2 notches puts it among states with the lowest credit= =20 ratings. Move could cost California hundreds of millions in borrowing fees.= =20 By LIZ PULLIAM WESTON and MIGUEL BUSTILLO Times Staff Writers=20 ?????A major credit rating agency downgraded $25 billion of California bond= s=20 Tuesday in a move that could add hundreds of millions of dollars to the=20 state's borrowing costs and saddles California with one of the lowest state= =20 credit ratings in the nation. ?????Standard & Poor's Corp. cut California's bond rating by two notches= =20 from AA to A-plus citing the mounting and uncertain cost . . . of the=20 current electrical power crisis which has forced the state to spend=20 billions on electricity to keep the lights on. ?????S&P one of three major rating agencies monitoring California's=20 financial health said a further downgrade could occur if the state fails t= o=20 follow through on plans to issue at least $10 billion in revenue bonds to= =20 help pay off energy-related debts. ?????S&P is saying 'We don't have any faith that what you say you're goin= g=20 to do you're going to do' said Zane Mann publisher of the California= =20 Municipal Bond Advisor a newsletter that tracks government debt. ?????Wall Street is concerned by delays surrounding the electricity bond=20 issue but lawmakers hope to pass legislation this week to put the bond iss= ue=20 on a fast track and speed up return of the money to the state's general fun= d. ?????Credit ratings help determine how much states and other borrowers have= =20 to pay when issuing bonds. The lower the rating the higher the interest ra= te=20 the state must pay to entice investors to buy. ?????The state Treasurer's Office concluded in a preliminary estimate that = as=20 a result of the downgrade California could have to pay $190 million to $57= 0=20 million more on the $12 billion in general obligation bonds the state has= =20 authorized to pay for ongoing expenses such as school and road-building=20 projects but has yet to issue.=20 ?????State revenue bonds should not be affected by the downgrade the=20 officials said. However some bond experts disagree. ?????California's energy crisis already has driven down prices of a wide=20 range of the state's bonds from general obligation issues that depend on t= he=20 state's ability to repay to small issues by school districts and cities tha= t=20 could be hurt by rising electricity prices. Bond traders said S&P's downgra= de=20 probably would cause prices to fall further. ?????All California bond holders are going to lose value in their bonds=20 because the state's credit has been downgraded said John Fitzgerald=20 managing partner of Seidler-Fitzgerald a Los Angeles municipal debt=20 underwriter. ?????The downgrade most affects investors who want to sell their bonds now= =20 before the issues mature. Investors who hold onto their bonds are still=20 almost certain to get the face value when their securities reach maturity= =20 because the state is unlikely to miss any interest payments or otherwise=20 default on its bonds traders said. ?????S&P analysts said the state's continuing surplus and deep and diverse= =20 economy helped prevent a further downgrade. ?????Still the downgrade places California below most other states on S&P'= s=20 rating scale and on par with Hawaii. Among states rated by S&P only=20 Louisiana has a lower rating at A-minus according to Bloomberg News.=20 ?????In addition the two other major credit rating agencies have indicated= =20 they may downgrade California's bonds. Fitch Inc. said last week that it wa= s=20 contemplating such a move and Moody's Investors Service earlier this month= =20 changed its outlook on California bonds to negative from stable. ?????Some politicians Tuesday accused S&P of overreacting. ?????It's just unfair premature and inappropriate for them to do that. We= =20 do have reserves we do have good revenue projections we do have a plan to= =20 get us out of this said Assemblyman Gil Cedillo (D-Los Angeles). ?????In a statement Gov. Gray Davis said California's economy is still=20 fundamentally strong period. We expect that in 2001 we will continue to le= ad=20 the nation in economic growth and job creation. ?????State Treasurer Phil Angelides has been pleading with lawmakers to pas= s=20 legislation to speed up repayment of $5 billion drained from the state's=20 general fund to buy electricity this year. That figure is expected to reach= =20 $15 billion by year's end according to the governor. ?????The consequences of a downgrade are profound Angelides said noting= =20 that it took California years to overcome the downgrades spurred by the=20 recession of the early 1990s. ?????It is critical that the Legislature act immediately to clearly=20 establish our legal authority to sell bonds and replenish the state's gener= al=20 fund Angelides said. ?????California began buying massive quantities of electricity in January= =20 because the state's three major investor-owned utilities could no longer=20 afford to do so. Since then the state has been purchasing roughly one-thir= d=20 of the electricity the utilities need to service their customers according= =20 to state officials. ?????Under a plan approved by the Legislature and signed into law by Davis= =20 the general fund is supposed to be reimbursed for the power purchases with= =20 what is expected to be the largest municipal bond issue in U.S. history. Th= e=20 bond issue is to be repaid by utility ratepayers through a monthly charge o= n=20 their electricity bills. ?????However obstacles that threaten timely repayment of the fund are=20 causing consternation among Wall Street analysts about California's financi= al=20 status. ?????The bankruptcy filing of Pacific Gas & Electric Co. the state's large= st=20 investor-owned utility has thwarted the state's plan to restore the=20 utilities to financial health. ?????But it is a dispute over the state's formula for repaying the bonds th= at=20 has raised the most concern among state officials. The state and the=20 utilities are at odds over how much of consumers' electricity payments shou= ld=20 go to reimburse the state for its power purchases. ?????The state's two major utilities Pacific Gas & Electric and Southern= =20 California Edison have challenged the Public Utilities Commission's plan f= or=20 splitting up the money--a legal move that threatens to delay issuance of th= e=20 bonds. The firms contend the allotment granted to the state is too generous= =20 and could make it harder for them to recover from the energy crisis. ?????Hoping to sidestep the controversy Angelides is urging state lawmaker= s=20 to pass an emergency measure this week that sets the bond amount and the=20 amount the state will receive from utility payments. The revenue bond was= =20 initially expected to be $10 billion but the Davis administration has sinc= e=20 proposed a $12.4-billion issue. ---=20 ?????Times staff writers James Flanigan Jenifer Warren and Julie Tamaki=20 contributed to this report. Copyright 2001 Los Angeles Times=20 --- --- ----------------------- Price Controls Spark Deja Vu=20 Energy: The specter of Richard Nixon's actions 30 years ago hangs over=20 current debate on how to check the state's surging power costs.=20 By JAMES F. PELTZ Times Staff Writer=20 ?????A debate now rages in California over whether price controls should be= =20 adopted to stem the state's soaring power costs and help consumers who are= =20 bracing for huge spikes in their electric bills. ?????But price controls are one of the most controversial actions in=20 economics--and in politics for that matter. And now the caps are more in= =20 dispute than ever because they run counter to the nation's move over the la= st=20 two decades to deregulate more and more industries from airlines to=20 railroads to energy. ?????Yet California is a good example of deregulation gone haywire so=20 controls are again being demanded by lawmakers consumer advocates and othe= rs=20 as a way to check surging prices. On the other side is a chorus of critics= =20 who ridicule price caps as being ineffective and at times making matters= =20 worse for consumers. ?????Case in point: the Golden State itself which tried last summer to use= =20 temporary price caps to keep a lid on skyrocketing wholesale electricity=20 prices. ?????Critics claim that the caps drove power sales out of state thus=20 widening the imbalance between supply and demand reinforcing the existing= =20 shortages and contributing to this winter's rolling blackouts. ?????But defenders of the caps note that the dysfunctional California marke= t=20 had no way to self-correct. The utilities couldn't simply refuse to buy=20 electricity in the face of higher prices and with no price ceiling in sigh= t=20 something had to be done. ?????And now Gov. Gray Davis and others are again calling for temporary=20 controls until more electricity supplies can be added especially as the=20 state enters the peak-power summer season. On Tuesday Sens. Dianne Feinste= in=20 (D-Calif.) and Gordon Smith (R-Ore.) introduced legislation that would impo= se=20 price controls on wholesale energy throughout 11 Western states. ?????Mindful of the controversial history of controls Feinstein and Smith= =20 stressed that the caps would last only through March 1 2003. But they also= =20 argued that the economic damage to industries and consumers from escalating= =20 power costs would exceed any harm caused by price controls. ?????I have a strong preference for markets but it's a mistake to believe= =20 that we have a free market when it comes to energy said Smith the only G= OP=20 co-sponsor of the legislation. ?????Their bill would require the Federal Energy Regulatory Commission whi= ch=20 regulates U.S. wholesale electricity prices either to impose a regional=20 price cap or institute a rate schedule for each power generator tying the= =20 price of electricity to the cost of producing it. ?????Coincidentally FERC today is expected to decide on various other=20 proposals to again limit California's power costs--but without explicitly= =20 stating that the plans include price controls. Why? Because the Bush=20 administration and FERC Chairman Curt Hebert Jr. among others are on the= =20 record as adamantly opposing price caps. ?????That's not surprising. Price controls often are tagged as a liberal=20 maneuver that flies in the face of conservatives' free-market ideology. Yet= =20 ironically hanging over the California debate is the legacy of a Republica= n=20 president who was the last one to mandate price controls on a nationwide=20 level: Richard M. Nixon. ?????The late president took that rare step 30 years ago this August to try= =20 to quell inflation and spark an economic rebound. His actions were so=20 dramatic that they are still invoked by those wanting to criticize or in= =20 some cases endorse setting limits on prices. ?????What he did is almost larger than life now said Shannon Burchett= =20 chief executive of RiskLimited Corp. a strategic consulting firm in Dallas= . ?????Nixon's controls were the most far-reaching since World War II when= =20 prices were capped so that profiteers couldn't reap huge sums for scarce=20 commodities being used for the war and simultaneously rationed at home. ?????In most cases price controls have been much less sweeping and targete= d=20 at specific products or services. They don't always involve changing the la= w=20 either. In 1962 President Kennedy publicly rebuked the then-U.S. Steel Cor= p.=20 and its chairman Roger Blough for starting an industrywide move to raise= =20 steel prices. The price hikes were rolled back a few days later. ?????Since Nixon price controls have become rarer as industries that were= =20 once regulated--which means their prices were government-controlled--have= =20 been deregulated. ?????So it is in California where electric utilities' prices were controll= ed=20 for decades until the state's deregulation law in 1996. But now that the la= w=20 has been blamed for the soaring wholesale prices power shortages crippled= =20 utilities and the need for a huge jump in ratepayers' costs some again wan= t=20 price controls on electricity until the crisis eases. ?????Which brings everyone back to Nixon. ?????Some Nixon Controls Were Lifted by Reagan ?????I've heard people make the analogy to what happened . . . when Nixon= =20 put on controls but in California this is fundamentally different said= =20 Mike Florio a board member of the California Independent System Operator= =20 which oversees most of the state's electricity grid. ?????When you get into a situation of shortage [of supplies] there is=20 really no restraint at all on prices said Florio who said he normally=20 prefers unfettered markets but also defended the state's caps last summer.= =20 Such government intervention on a temporary basis is better than nothing= =20 but I don't think it's ideal. ?????The reverberations from Nixon's fiat aren't just felt in California=20 either. When New York Mayor Rudolph Giuliani recently proposed more stringe= nt=20 controls on wholesale electricity costs in New York state critics promptly= =20 pointed to Nixon's controls. They were a disaster one columnist wrote. ?????Even Federal Reserve Chairman Alan Greenspan who was in the private= =20 sector in the early 1970s turned down several requests to take high-level= =20 White House jobs in part because he was disgusted with Nixon's price contro= ls. ?????Many economists and historians also judge Nixon's controls as a mistak= e.=20 But some maintain that his decision--which began with a 90-day freeze on=20 prices wages and rents--wasn't entirely a failure and even provided shock= =20 value that for a while at least arrested higher inflation. ?????In addition part of Nixon's move involved taking the dollar off the= =20 gold standard--which in effect meant its price was controlled--and letting = it=20 float in value against other major currencies. And that many believe is t= he=20 base upon which today's global financial markets operate. ?????Others disagree. ?????There really isn't an example of where they've [price controls]=20 worked said Robert Goldberg a senior fellow at the National Center for= =20 Policy Analysis a nonpartisan think tank in New York. ?????Controls always lead to an underproduction of the commodity involved= =20 because producers don't have any incentive to spend more on additional=20 output he said. When the caps ultimately are lifted prices typically soar= =20 anyway as producers move to quickly recoup the profit they lost when the=20 controls were in place Goldberg added. ?????Others note that although most of Nixon's price controls lasted only a= =20 couple of years various forms of controls over crude oil and natural gas= =20 lasted for another decade until they were removed by President Ronald Reaga= n. ?????In the meantime the controls--aggravated by embargoes and other suppl= y=20 cuts by the Organization of Petroleum Exporting Countries--distorted the fr= ee=20 market for energy critics say. The controls kept U.S. oil prices=20 artificially low which in turn kept demand for oil high giving OPEC more= =20 power over world production and prices in the 1970s they contend. ?????Nonetheless proponents keep calling for controls when prices for=20 certain items seem to be spiraling out of control. ?????Critics Say Controls Worsen the Problems ?????President Clinton's massive health-reform proposal in the early 1990s= =20 included price controls on drugs. But the idea set off howls of protest fro= m=20 the pharmaceutical and biotechnology industries and ultimately the entire= =20 proposal was shelved. Consumer advocates and others also demanded federal= =20 controls on rising cable TV rates in 1997 and 1998 again contending that t= he=20 cable operators were hiking prices at a much faster rate than inflation.=20 Cable firms were allowed to keep passing certain costs on to their=20 subscribers but specific price caps weren't enacted. ?????But proponents of temporary price controls on California power emphasi= ze=20 that electricity isn't in the same category as an airplane seat steel or= =20 other commodities that don't have to be bought if the price soars too high. ?????In soybeans maybe the market can adjust quickly to changes in supply= =20 and demand but in electric generation in California it can't said Flori= o=20 who also serves as an attorney for the Utility Reform Network a consumer= =20 group. For most products one of the ways prices get determined is if buye= rs=20 refuse to buy when the price gets too high. But that's generally not an=20 option for people when it comes to electricity. ?????Critics of California's attempt to cap prices last summer said the=20 controls instead prompted many power suppliers to sell their electricity to= =20 other states. That actually made the tight-supply problem worse [in=20 California] by driving imports out of the state the Bay Area Economic=20 Forum a research group funded by regional business and government agencies= =20 said in a report last week. ?????Indeed the temporary caps were basically abandoned by year's end to= =20 keep enough electricity in the state. ?????Frank Wolak a Stanford University economics professor who heads the= =20 Independent System Operator's market surveillance committee said there are= =20 ways to mitigate the state's power prices without having to set rigid=20 controls. One proposal: Have FERC require that generators supply 75% of the= ir=20 expected future sales to California under long-term contracts at just and= =20 reasonable prices set by the federal agency he said. ?????That would send the right [price] signal to suppliers to come into th= e=20 state Wolak said. ?????And because it will take time for California to get more of its own=20 power-generating plants up and running the state's electricity crisis isn'= t=20 unlike a natural disaster in which normal public service is disrupted and= =20 short-term controls serve a purpose Florio said. ?????Over time market forces will work and controls shouldn't be need h= e=20 said. But does that mean we're supposed to pay $10000 per kilowatt-hour= =20 until something gets done? ---=20 ?????Times staff writer Ricardo Alonso-Zaldivar in Washington contributed t= o=20 this report. Copyright 2001 Los Angeles Times=20 --- --- ------------ Davis Names Executive to Speed Construction of Power Plants in State=20 Energy: Richard Sklar headed a building firm and worked for Clinton in=20 Bosnia. Governor sees the crisis abating by fall.=20 By DAN MORAIN Times Staff Writer=20 ?????SACRAMENTO--With temperatures rising and electrical supplies strained= =20 Gov. Gray Davis on Tuesday tapped a former Clinton administration official= =20 and executives from major construction firms to help speed completion of=20 power plants. ?????Davis who predicted that the worst of the energy crisis will abate by= =20 the fall announced that he has retained Richard Sklar 67 former presiden= t=20 of a construction firm to head a team that will help accelerate the buildi= ng=20 of power plants. ?????Speaking to business leaders at a California Chamber of Commerce=20 convention in Sacramento Davis said Sklar's job will be to make sure ther= e=20 are no hurdles [and] to cut red tape. ?????Richard Sklar knows electricity Davis said. He knows how to find= =20 megawatts. ?????Former President Bill Clinton sent Sklar to the Balkans in 1996 to try= =20 to help resolve the war in Bosnia-Herzegovina. Sklar arrived in Sarajevo to= =20 find that power was on for only two hours a day and set about expanding=20 electricity generation. ?????In an interview Sklar said his father was a mechanical engineer who= =20 designed power stations. ?????This power world is my world Sklar said adding that he had an=20 electric car and solar panels in the mid-1970s. ?????This Feb. 8 Davis announced at a news conference that he was appointi= ng=20 Larry Hamlin a vice president of Southern California Edison as his=20 construction czar. Hamlin's job was to speed power plant construction. ?????Davis spokesman Roger Salazar said that Hamlin's stint was temporary a= nd=20 that the executive must return to Edison. Sklar's contract is for a longer= =20 period Salazar said but it is unclear how long. ?????Sklar is being retained as a consultant paid $100000 initially. Othe= r=20 firms Salazar said are loaning employees as volunteers. Joining Sklar wil= l=20 be representatives of the engineering and construction firms Bechtel URS= =20 Corp. Engineering Fluor Daniel Parsons Brinckerhoff Quade & Douglas and = A.=20 Teichert & Sons. At least one Bechtel subsidiary is involved in power plant= =20 construction in California. ?????There is no conflict of interest Sklar said adding that no one in= =20 the group will have authority to decide who gets contracts. ?????A mechanical engineer Sklar was president of the San Francisco-based= =20 construction management firm O'Brien Kreitzberg Inc. Sklar's firm also=20 oversaw construction of the Metro Rail Green Line in Los Angeles and the=20 rebuilding of the Los Angeles Central Library. ?????He was also chairman of the San Francisco Public Utilities Commission= =20 under then-Mayor Dianne Feinstein. In that role he oversaw rebuilding of t= he=20 cable car system completing the work ahead of schedule--in time for the 19= 84=20 Democratic National Convention there. Feinstein's husband is a major invest= or=20 in URS one of the firms that will loan employees to Sklar's team. ?????He's very competent said state Senate President Pro Tem John Burton= =20 (D-San Francisco) of Sklar whom he met in 1972. He's a very good problem= =20 solver and he brooks no nonsense. . . . He's a renaissance man. He loves=20 music he loves politics and he's a gourmet cook. ?????Sklar has also displayed a sense of humor once donating to San=20 Francisco Zoo two capybaras rodents the size of a hog. He named one Quenti= n=20 and the other Kopp after a former San Francisco city supervisor and state= =20 senator who is now a Superior Court judge. ?????I'm 67 I've made all the money I need to make said Sklar who owns= a=20 vineyard near the Napa Valley town of Rutherford and has a home in San=20 Francisco. ?????My reputation is what's going to be at stake in this not the=20 governor's he said. I have a 40-year history of delivering--and that's= =20 what I'm going to do. I don't like to lose. ?????As Davis announced Sklar's appointment one of the governor's top ener= gy=20 advisors John Stevens resigned effective Friday. The governor praised=20 Stevens as a tireless worker. ?????Stevens worked on several energy-related tasks among them Davis'=20 efforts to keep utilities out of bankruptcy. Davis appointed him for a day = in=20 January to the state Public Utilities Commission on which he cast a key vo= te=20 to raise rates. ?????The state's power grid operators declared a Stage 2 emergency Tuesday= =20 afternoon as temperatures hit 90 degrees in downtown Los Angeles and two= =20 major power plants in Southern California unexpectedly shut down. Power=20 reserves dropped to nearly 5% below the minimum 7% that the California=20 Independent System Operator seeks to maintain. ?????Tuesday's emergency is not a predictor of worse electricity troubles t= o=20 come said Cal-ISO's Stephanie McCorkle because an unusually high number o= f=20 power plants are down for repairs that were planned months ago. ?????The plants not running Tuesday would be capable of supplying 10000=20 megawatts she said or about a third of Tuesday's peak demand. By mid-June= =20 no power plants should be shut off for scheduled maintenance McCorkle said= . ?????The state will lose more than 1000 megawatts of production starting= =20 this weekend when a unit of the Diablo Canyon nuclear power plant near San= =20 Luis Obispo is shut down for refueling. The shutdown planned a year ago= =20 will last 35 days according to Pacific Gas & Electric. ?????In his remarks Tuesday Davis said his goal is to boost the state's=20 energy supply to exceed demand 15% by 2003.=20 ?????This is probably the most complicated challenge the state has faced i= n=20 50 years Davis said. But we are providing steady and reliable leadership= =20 and I believe this thing will be behind us by the end of fall. ---=20 ?????Times staff writers Nancy Vogel and Jenifer Warren contributed to this= =20 story. Copyright 2001 Los Angeles Times=20 --- --- Power Plant Emits Tons of Fumes=20 Round-the-clock operation of old generators in Glendale and elsewhere=20 produces more than twice the old limits of pollution.=20 By JEAN GUCCIONE Times Staff Writer=20 ?????For the past five weeks Glendale's Grayson power plant has been=20 belching a half-ton of pollutants into the air almost daily more than twic= e=20 previous limits. ?????The same is true for many of the other 14 power plants in Southern=20 California as the haves generate power sometimes round-the-clock for th= e=20 have-nots. ?????The generators some of them nearly 50 years old and once considered t= oo=20 dirty for regular use now keep electricity flowing to fellow residents=20 around the state. And those living downwind are subjected to twice as much= =20 air pollution as before California's energy crunch. ?????Not every Glendale resident is happy. ?????You don't want anyone to get stuck with a rolling blackout but we ge= t=20 struck with the pollution Jerold Petrosian said as he and his family boug= ht=20 plants at a nursery across the street from the power plant. It is a tough= =20 decision. ?????Not so for Ignacio Troncoso director of Glendale Water & Power. Ther= e=20 is a pretty decent trade-off helping our neighbors in the state to keep=20 their lights on he said. ?????A USC specialist warned that increased power plant emissions raise the= =20 risks of asthma and other lung ailments in the young and old. ?????There is a potential for more emergency room visits more people seei= ng=20 their doctors and more hospitalizations this summer said Dr. Henry Gong= =20 professor of medicine and a specialist in the health effects of air polluti= on. ?????With extended hours the Glendale generators are emitting as much as 9= 95=20 pounds of pollutants into the air during peak demand more than double the= =20 old limit of 390 pounds a day city and air-quality officials said. ?????The other 14 power plants in Southern California also have more than= =20 doubled their overall emissions according to preliminary figures from the= =20 South Coast Air Quality Management District. As a group the plants emitted= a=20 total of 2045 tons of smog-forming nitrogen oxide in the first three month= s=20 of 2001 compared with 905 tons for the same period last year. ?????The AQMD hearing board on Tuesday eased pollution controls so Glendale= =20 may continue to generate excess electricity for sale to the energy-starved= =20 state. Under the plan Glendale may run three of its old steam boilers=20 around-the-clock to meet the state's energy demand. Usually these boilers= =20 hidden behind a tall brick wall sit idle except during the peak summer=20 demand because they are inefficient and costly. ?????Glendale like Burbank and the Los Angeles Department of Water and=20 Power continues to produce electricity at its city-owned plant. The three= =20 cities opted against participating in a scheme of deregulation a decision= =20 that has shielded their residents by and large from the huge utility rate= =20 hikes and rolling power outages experienced elsewhere. But they also will= =20 contribute to easing the state's energy emergency in the dirtier air they= =20 will be forced to breathe. ?????Air-quality officials said power plants contribute just about 3% of th= e=20 900 tons of pollution emitted into the air daily with about 70% of the=20 pollution coming from vehicles not factories. And in recent years many of= =20 the region's municipal power generators have been updated with=20 pollution-control devices that reduce emissions. ?????Glendale's three steam generators built between 1953 and 1963 are=20 inefficient by today's standards but they are 85% cleaner since the city= =20 pumped millions of dollars into upgrades. They will be even cleaner city= =20 officials say with more retrofitting. ?????Under the plan Glendale must reinvest profits from energy sales=20 estimated at $3 million to $5 million this year in equipment to reduce=20 future emissions at the plant and in community-based programs such as mobi= le=20 asthma clinics and programs to reduce school bus emissions. ?????The city plans to sell as much as 50 megawatts of power enough to ser= ve=20 50000 homes. Under the decision Tuesday pollution limits resume Jan. 1= =20 2002 or when the energy emergency ends. ?????In Los Angeles power officials said they don't expect to exceed AQMD= =20 caps because they are adding pollution controls at two of the city's four= =20 power plants. Although they will produce more electricity they should not= =20 produce any more nitrogen oxide which in sunlight and heat form ozone sai= d=20 Angelina Galiteva LADWP's director of strategic planning. ?????We will have much cleaner equipment in place by June she said. ?????Even the environmentalists are trying to balance the risks. ?????We realize we have a problem this summer. We have to run these plants= =20 said Sheryl Carter a senior policy analyst for the National Resources=20 Defense Council. ?????Carter said natural-gas-powered generators like the ones in Glendale= =20 are a far superior solution to diesel generators which produce 50 to 100= =20 times the emissions and would be turned on in businesses across the state i= f=20 energy is unavailable from other sources. ?????We are trying to make sure the environment overall is made whole sh= e=20 said. ?????Carl Zichella regional staff director for the Sierra Club said the= =20 generators should be run as a last resort. He also urged consumers to unplu= g=20 spare refrigerators and use energy-efficient light bulbs to reduce the=20 state's overall energy demand. ?????The only thing that is going to work to offset air pollution is=20 efficiency he said. Otherwise we will pay not only with higher rates bu= t=20 also with our health. ?????In neighboring Burbank city officials are preparing for peak summer= =20 energy demands when they expect to sell about 10% of their locally produce= d=20 electricity outside the city. ?????For four or five years we have been polluting Utah Arizona Nevada= =20 Washington and Oregon importing power to Los Angeles said Ron Davis=20 general manager of Burbank Water & Power listing the energy-producing stat= es=20 that typically produce the bulk of Southern California's power. We are=20 returning the favor. ?????Profits from those outside sales Davis said will help hold down=20 utility costs for local users. ?????I think most people would take a little more smog to guarantee there= =20 are no rolling blackouts he said. But it's not an easy question. Copyright 2001 Los Angeles Times=20 --- --- ---------- Power Plant Plan Worries Neighbors=20 Energy crisis: Regulators will decide next week whether to allow Huntington= =20 Beach facility to boost output. Noise and pollution are concerns.=20 By CHRISTINE HANLEY Times Staff Writer=20 ?????On Hula Circle in Huntington Beach families have tried to live with= =20 their two very different neighbors. They live steps from the Pacific Ocean= =20 but next door to the mechanical shrieks and foul smells of the massive AES= =20 Corp. power plant. ?????But California's power crisis is rapidly unhinging life in the=20 neighborhood of ranch houses and bungalows. ?????State regulators will decide next week whether to allow the company to= =20 double the plant's operations by July providing much-needed electricity bu= t=20 taking what residents fear will be a heavy toll on them. ?????It's one of several proposals to restart or build new power plants in= =20 the wake of the power crisis using a fast track process that allows the= =20 projects to go forward before environmental and pollution studies are=20 completed. ?????The plant is so close. We want to know if it is impacting our kids in= =20 ways we won't know about until 10 years from now said Janette Mortimer w= ho=20 lives with her husband and their two young children in one of the homes=20 closest to the plant. ?????Already residents say the AES plant is casting a mightier shadow.=20 There are the ear-ringing rumbles and roars. There are the mysterious plume= s=20 of smoke that waft over the neighborhood. Then there is the grime that seem= s=20 never to go away. ?????If the California Energy Commission approves the permit for AES the= =20 facility could run at full capacity for the first time in memory. Officials= =20 said the plant's previous owner Southern California Edison typically ran = it=20 at 30% of capacity. ?????AES could be allowed to run the four gas-fired boilers and a peaker= =20 unit whenever California hits a Stage 3 alert--which is expected to happen= =20 often this summer. The peaker plant alone is powered by eight jet=20 engines--and sounds like it. ?????Currently only two boilers are operating. ?????But residents say they are most worried about the air they breathe and= =20 the water they swim in. ?????Under the fast-tracking process designed to get more electricity for t= he=20 state as soon as possible several key environmental questions have yet to = be=20 studied. ?????Scientists studying the cause of ocean pollution that closed much of= =20 Huntington Beach's shoreline in the summer of 1999 said that the plant alo= ng=20 with other factors played a role by drawing partially treated sewage that = is=20 discharged miles offshore back toward the coast. ?????AES Inc. will pay $1.5 million to further study the issue but the=20 research won't be complete for some time. ?????So much is uncertain said Huntington Beach Councilwoman Shirley=20 Dettloff. These are big big things. ?????For now residents say they are bracing for more noise smoke and=20 disruption. ?????To begin with AES' proposal calls for 20 hours a day of nonstop=20 construction to get the two mothballed generators in service by July. ?????Then there are the sizzling summer temperatures. Residents usually ope= n=20 their windows to let the ocean breezes cool their homes. But the noise and= =20 smells from the plants may make that impossible. ?????It's going to be bad. There's no escape said Bryan Visnoski. ?????The plant has towered over the Huntington Beach coastline for nearly 4= 0=20 years. The housing tracts came later but most inhabitants of Hula Circle a= nd=20 surrounding streets seemed to make peace with their industrial neighbor. ?????Some have installed double-paned windows to dampen the sound. Others= =20 have remodeled their homes to obstruct ugly views. The Mortimers grew tall= =20 trees and trained vines past the windows. ?????The problems they say began with the energy crisis. ?????The plant was owned by Edison until 1998 when it was sold to=20 AES--California's largest private electricity producer--at the dawn of=20 deregulation. ?????The two gas-fired boilers that AES wants to restart have been dormant= =20 since 1995 and were slated for demolition until the power crisis struck. ?????But a few months ago as rolling blackouts hit the state Gov. Gray Dav= is=20 signed an executive order allowing peaker plants to operate at extended= =20 hours. Peaker plants can produce electricity in quick bursts but guzzle= =20 large amounts of natural gas and are noisy. ?????Hulu Circle residents said the order has resulted in more hours of lou= d=20 jet noises that make then feel like they live by an airport. ?????Whenever the peaker plant goes on residents call the Air Quality=20 Management District to send someone to test the plume of smoke. The=20 inspections have not detected any violations. ?????The proposal before the state Energy Commission would allow AES to=20 double its electricity output in Huntington Beach from 500 megawatts to 10= 00=20 megawatts. ?????The company's two 40-year-old units represent about 10% of the 5000= =20 additional megawatts Davis has promised to meet an expected energy shortfal= l=20 this summer. ?????Despite the fast-tracking process the company has vowed that it would= =20 safeguard against environmental damage and remedy any problems from plant= =20 operations. ?????If the plant is identified as drawing bacteria back to shore AES woul= d=20 have to pay the costs deemed necessary to fix problems. ?????This is little consolation to residents who would prefer a full=20 environmental review. Copyright 2001 Los Angeles Times=20 --- --- Federal plan called 'too little too late'=20 Limited price control seen as step in right direction but officials renew= =20 call for price ceiling Zachary Coile Chronicle Political Writer Wednesday April 25 2001=20 2001 San Francisco Chronicle=20 URL:=20 /25/M N104049.DTL=20 As federal energy regulators consider a plan intended to ease the state's= =20 worsening energy crisis California officials and some energy experts are= =20 already criticizing it as inadequate.=20 The Federal Energy Regulatory Commission is scheduled today to debate a=20 proposal that would force power generators to sell electricity at a=20 discounted price to California during severe power emergencies.=20 The proposal would require producers to sell energy to the state's power gr= id=20 during Stage 3 emergencies. Stage 3 emergencies are declared when energy=20 resources are almost depleted allowing utilities to cut off power to=20 customers at any time.=20 The plan also would limit how much energy firms could profit off such sales= .=20 But Gov. Gray Davis and Sen. Dianne Feinstein among others say stronger= =20 remedies -- including the temporary regional price limits they have advocat= ed=20 for months -- are needed to stave off a summer of blackouts and power=20 shortages.=20 I think the plan before FERC is too little too late Davis said yesterda= y=20 in Sacramento.=20 We need help all the time. The regulatory commission plan excludes 95=20 percent of the purchases of power. A Stage 3 situation is by definition= =20 chaotic as we scramble to find the megawatts to keep the lights on.=20 The commission ordered its staff in December to come up with remedies to=20 California's energy woes. The commissioners are expected to make their=20 decision by May 1 a self-imposed deadline to help the Golden State.=20 The proposal to be debated today would require producers to sell electricit= y=20 to California at a price based on the costs of the least-efficient plant=20 providing the energy. More efficient plants sending energy to the state wou= ld=20 still be able to make a sizable profit.=20 The plan has also drawn criticism because it applies only to California no= t=20 other Western states that are also feeling the pinch of higher energy price= s.=20 But California officials say the proposal does signal a shift in the hard-= =20 line position of the commission's majority against any form of price=20 controls. The plan would set some form of price ceiling even if only durin= g=20 extreme conditions.=20 In regulatory commission documents the plan is referred to as price=20 mitigation -- not price limits.=20 I sincerely don't believe that FERC would even be considering the Stage 3 = if=20 it were not for us making substantial noise about a temporary cap said=20 Feinstein D-Calif. who introduced a bill with other Western senators=20 yesterday to require the agency to impose temporary price controls on energ= y=20 sold to Western states.=20 Severin Borenstein director of the University of California Energy=20 Institute said the regulatory commission has yet to make a compelling case= =20 for why its Stage 3 plan would help lower sky-high prices.=20 The argument being made to support this is that firms are only able to=20 exercise market power during Stage 3 emergencies Borenstein said. And th= e=20 evidence is quite clear that's just not true.=20 It's unfortunate that FERC thinks this is solving some problem for=20 California because it won't.=20 E-mail Zachary Coile at zcoile@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 10=20 --- S&P lowers California's bond rating=20 First cut since '94 could cost taxpayers millions=20 Kathleen Pender Chronicle Staff Writer Wednesday April 25 2001=20 2001 San Francisco Chronicle=20 URL:=20 /25/M N211494.DTL=20 Citing the rapidly escalating uncertainty surrounding the power crisis= =20 Standard & Poor's slashed California's credit rating yesterday for the firs= t=20 time since 1994 when the state was still climbing out of a recession.=20 The downgrade -- and the energy debacle that led up to it -- will cost=20 taxpayers tens or hundreds of millions of dollars a year by raising the=20 state's borrowing costs. Investors will probably see the market price of=20 California municipal bonds and bond funds decline further.=20 But the biggest blow may be to the state's ego. S&P downgraded the state's= =20 general obligation bonds two notches -- to A+ from AA. The only other state= =20 currently rated A+ is Hawaii. The only state with a lower credit rating is= =20 Louisiana according to S&P.=20 Most states are rated AA. Some states don't have a credit rating because th= ey=20 don't have bonds.=20 California's credit rating is still investment grade which means it is n= ot=20 expected to default on its bonds. However the state's ability to repay its= =20 debt isn't as strong as it used to be said Steve Zimmermann a managing= =20 director with Standard & Poor's. This is a very speculative situation.=20 States hire companies like S&P to give them an independent credit rating wh= en=20 they borrow money by selling bonds. The rating reflects the state's ability= =20 to repay its debt in full on time.=20 When they sell new bonds states with lower credit ratings usually pay high= er=20 interest than higher-rated states to make up for the added risk.=20 A rating change does not affect the interest rate states pay on bonds that= =20 have already been issued but it can affect the price of bonds when they=20 trade on the open market among investors.=20 Yesterday's downgrade reflects the mounting and uncertain cost to the stat= e=20 of the current electrical power crisis as well as its likely long-term=20 detrimental effect on the state's economy S&P said in a news release.=20 Given the large magnitude of the problem in relation to the size of fund= =20 balances the state typically budgets the capacity to pay debt service whi= le=20 still adequate has been reduced.=20 In January S&P placed the state's debt on CreditWatch with negative=20 implications a signal that it might lower the rating.=20 In an unusual move S&P kept the state on CreditWatch after yesterday's=20 downgrade which means the rating could fall even lower.=20 Zimmermann said S&P is keeping California on CreditWatch pending its abilit= y=20 to sell $10 billion to $14 billion worth of bonds to reimburse the state's= =20 general fund for past and future power purchases.=20 If they did the bond issue they'd replenish the fund at least for the=20 short term. If they don't do it then it's more of a concern Zimmermann= =20 said.=20 Unfortunately the downgrade could make it harder for the state to sell the= =20 bonds.=20 If they could have gotten the deal done before the downgrade they would= =20 have had a stronger deal said Kelly Mainelli a municipal bond fund manag= er=20 with Montgomery Asset Management.=20 California must obtain an investment-grade rating (BBB- or higher) on the= =20 bonds before it can sell them.=20 Mainelli said California municipal bond prices have already fallen in=20 anticipation of a ratings cut. When prices fall bond yields go up.=20 The downgrade is the culmination of everything that's happened since early= =20 December he said.=20 In November California municipal bonds yields were 0.4 to 0.5 percentage= =20 points below the national average. Today they're 0.1 to 0.2 percentage=20 points above the national average and Mainelli thinks they could go up 0.1= =20 to 0.2 percentage points more because of the downgrade.=20 The total difference -- about 0.7 percentage points -- doesn't sound like= =20 much but it adds up.=20 Last year the state itself sold $4.6 billion in new bonds (excluding bonds= =20 sold to replace existing bonds). If it sells the same amount this year plu= s=20 $12 billion in energy bonds that 0.7 percentage point difference on $16.6= =20 billion in bonds would cost the state $116 million a year in additional=20 interest costs.=20 Yesterday's downgrade only affected the state's general obligation bonds an= d=20 others secured by the full faith and credit of the state such as the=20 California Health Facilities Construction Loan Insurance Fund (Cal Mortgage= ).=20 But the energy debacle could wind up costing other municipal bond issuers i= n=20 California -- such as cities counties school and water districts -- more= =20 money when they sell bonds. Although their ratings have not changed because= =20 of the energy crisis analysts say the yields on most California municipal= =20 bonds have gone up and will go up some more as a result of the state's=20 downgrade.=20 The values of all California bonds will be hurt by this downgrade whether= =20 they should be or not. Psychologically it's just how the market reacts= =20 says Richard Goldstein a San Ramon financial planner.=20 Investors who have to sell their California bonds on the open market before= =20 they mature may not get all their principal back. But investors who hold=20 their bonds until maturity will probably get paid in full Goldstein said.= =20 No matter how bad the energy crisis gets most experts believe the state wi= ll=20 continue making principal and interest payments on its bonds even if it ha= s=20 to raise taxes cut expenditures or run a temporary deficit to do so.=20 There's also the prospect at some point of federal help Goldstein said.= =20 The federal government does not want California to default or even come=20 close.=20 Do you know what that would do to the national economy and the world=20 economy?=20 California's bond-rating history=20 S&P cut its rating on California debt yesterday for the first time since=20 1994.=20 What credit ratings mean=20 -- AAA: Extremely strong capacity to meet financial commitments.=20 -- AA: Very strong capacity to meet financial commitments.=20 -- A: Strong capacity to meet financial commitments but somewhat more=20 susceptible to adverse circumstances and economic conditions.=20 -- BBB: Adequate capacity to meet financial commitments. However adverse= =20 economic conditions could weaken ability to pay debts.=20 Note: Ratings below BBB are considered poor investment risks and the issue= s=20 sometimes are called junk bonds.=20 Source: Standard & Poor's=20 Chronicle Graphic=20 E-mail Kathleen Pender at kpender@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- NEWSMAKER PROFILE=20 Richard Sklar=20 Ex-Muni boss becomes energy czar=20 Davis' pick to oversee power plant construction=20 Greg Lucas Sacramento Bureau Chief Wednesday April 25 2001=20 2001 San Francisco Chronicle=20 URL:=20 /25/M N232441.DTL=20 Sacramento -- San Franciscan Richard Sklar onetime trouble-shooter for the= =20 Municipal Railway and later a figure in the U.S. aid effort for Bosnia wil= l=20 head a team of construction experts working to build power plants faster= =20 Gov. Gray Davis said yesterday.=20 Sklar 66 is the second energy czar the governor has appointed in a week= .=20 Last week he named S. David Freeman head of the Los Angeles Department of= =20 Water and Power to lead the state's conservation efforts.=20 Mr. Sklar is with us for the long haul Davis said after speaking to the= =20 State Chamber of Commerce. He's a no-nonsense person.=20 Sklar will work with representatives of some of the largest construction=20 firms in the world such as Bechtel to map out timelines and identify=20 potential problems in building power plants.=20 Under the Davis administration 13 power plants have been approved eight o= f=20 which are under construction.=20 This is the red meat I chew on my friend Sklar said yesterday in a=20 telephone interview from New York.=20 We're going to be getting these projects under way and follow them from th= e=20 'let's do it' stage to the day we cut the ribbon.=20 Sklar has already had a chance to study the energy situation in California= =20 from afar. In January while serving as then-President Bill Clinton's point= =20 man for helping southeast Europe move toward capitalism Sklar said=20 California is an object lesson in how not to deregulate. You've got to hav= e=20 both capitalism and regulation.=20 The way California worked deregulation Sklar said was a colossal mistake= .=20 =20 Sklar has more than 35 years of public and private management experience= =20 much of it in San Francisco.=20 He came to the city from Cleveland in the mid-1970s and soon joined the=20 mayoral campaign of the late George Moscone. Impressed by Sklar's drive=20 Moscone handed him the reins to the city's huge wastewater program.=20 Sklar known as a man of limitless self-confidence quickly made a name for= =20 himself as a head-knocking administrator with an abrupt management style b= ut=20 he got the languishing program moving.=20 Citing Sklar's vigor and force then-Mayor Dianne Feinstein appointed him= =20 general manager of the San Francisco Public Utilities Commission which=20 oversees the city's Water Department. He held the post until 1983 while als= o=20 leading the Muni for three years.=20 Sklar soon earned a reputation at City Hall for flamboyance. Critics said= =20 Sklar enjoyed seeing his name in print and his face on TV a bit too much. H= e=20 took the criticism in stride.=20 I inspire intense feelings he told The Chronicle in 1982. You love me o= r=20 you hate me -- and probably for good reason.=20 By the end of his tenure Feinstein and Sklar were feuding openly over=20 everything from the Muni to high-rise development. The mayor called him=20 arrogant. He in turn called her a lightweight who was no great=20 political star.=20 From 1983 through 1996 Sklar worked for San Francisco-based O'Brien-=20 Kreitzberg one of the largest construction management firms in the United= =20 States. The firm specializes in public works projects.=20 Sklar became the company's president in May 1995 after running O'Brien-=20 Kreitzberg's Eastern and international operations a job that led to=20 Clinton's naming him to coordinate the rebuilding of war-ravaged Bosnia in= =20 1996.=20 During Sklar's year on the job the Sarajevo airport was quickly reopened= =20 and round-the-clock electricity was restored in the city before winter.=20 In 1997 Clinton named Sklar ambassador to the United Nations for reform an= d=20 management. His primary task was to shake loose from a reluctant GOP-=20 controlled Congress more than $1 billion in delinquent dues owed by the=20 United States.=20 In June 1999 he moved to Rome to serve as Clinton's point man on economic= =20 development of southeast Europe. He is now a mediator specializing in=20 construction cases.=20 E-mail Greg Lucas at glucas@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 10=20 --- Will price caps deter investment as federal regulators say?=20 KAREN GAUDETTE Associated Press Writer Wednesday April 25 2001=20 2001 Associated Press=20 URL:=20 tate0 343EDT0117.DTL=20 (04-25) 00:43 PDT SAN FRANCISCO (AP) -- Some key power generators say=20 California's dearth of energy supplies and its growing demand make it a= =20 good place to build more plants and sell more power in the years to come --= =20 even if dreaded price caps are imposed.=20 ``Regardless of what the (market) structure turns out to be the state's=20 going to need electricity and it's going to need to buy it from somebody''= =20 said Bill Highlander spokesman for San Jose-based Calpine Corp.=20 Calpine is investing about $4 billion in power plants over the next four=20 years that will generate 9000 megawatts enough for more than 6 million=20 homes. The state's current energy crisis ``hasn't really changed our plans = or=20 our strategy'' he said.=20 But Chief federal energy regulator Curtis Hebert says price caps on wholesa= le=20 electricity will hinder not help California's energy crisis.=20 Energy wholesalers seeking higher prices than California is willing to pay= =20 will invest in other states warns Hebert the chairman of the Federal Ener= gy=20 Regulatory Commission. And any regulations that cut into future profits wil= l=20 scare away desperately needed new power plants he says.=20 Eight of the 13 new power plants approved in California already are under= =20 construction. Twelve more are under review according to the California=20 Energy Commission which approves power plants.=20 CEC spokesman Rob Schlichting said that's a huge boost over the last decade= =20 when uncertainty over the rules of deregulation -- not a threat of price ca= ps=20 -- kept applications down. No companies have withdrawn plans to build plant= s=20 since December.=20 ``The only way price caps would scare away investment is if they were set s= o=20 low you couldn't make a profit'' Schlichting said. ``It's still a market= =20 that people seem to want to come in and produce power for.''=20 Other companies still planning to invest in California include North=20 Carolina-based Duke Energy which has two plants in the works and=20 Houston-based Reliant Energy which is negotiating with the state to sell= =20 power on long-term contracts.=20 Reliant's spokesman Richard Wheatley wouldn't say whether price caps alon= e=20 would inhibit them from building more plants. What he did say is that=20 California's power politics leave a lot of room for improvement.=20 The state has considered taking over power plants through eminent domain an= d=20 implementing a windfall profits tax to take some of their earnings away.=20 Meanwhile Attorney General Bill Lockyer is offering a bounty for any=20 information that could prove wholesalers worked together to drive up prices= =20 which could lead to more lawsuits and investigations.=20 If California wants to encourage construction it's got to tone down its=20 vilification and stop adding more restrictions Wheatley said.=20 ``Whenever we go into an area and consider building a power plant we have = to=20 look at the economics of the facility we have to look at the regulatory=20 situation esoteric things like what the mindset is like'' he said.=20 ``California is not the easiest place in which to do business.''=20 Some power companies have invested so much in pipelines gas reserves and= =20 plants already under construction that it's folly to turn back now.=20 ``We want to build in California but we need to have regulatory stability = or=20 at least regulatory clarity to move these things forward because they're=20 half-billion dollar projects in some cases'' said Tom Williams a spokesma= n=20 for Duke. ``That's a lot of bananas.''=20 Senators Dianne Feinstein D-Calif. and Gordon Smith R-Ore. plan this we= ek=20 to introduce legislation urging FERC to impose a temporary price cap over t= he=20 11 Western states. They hope to keep prices down in the short-term and give= =20 California and other troubled states a breather to make long-term decisions= .=20 Feinstein's bill does not yet specify a price. Some economists say $150 to= =20 $250 per megawatt hour would be just and reasonable yet provide generators= a=20 profit. Prices have gone as high as $1500 for the same amount of power in= =20 the past year.=20 Tying the price cap to the cost of making power could make it easier for=20 generators to swallow said Severin Borenstein director of the University = of=20 California Berkeley's energy institute. Such a cap would account for=20 variables such as the wildly fluctuating cost of natural gas used to genera= te=20 much of the energy in California's power plants.=20 Price caps can be effective but only if they are very carefully designed= =20 warned Frank Wolak chairman of the Independent System Operator's market=20 surveillance committee. The ISO manages the state's power grid.=20 Set them too high and companies will only bid that amount saving little= =20 money Wolak said. Too low and the generators could choose to sell elsewhe= re=20 unless all other nearby states have the same price limits.=20 Also capping the most expensive energy sales -- power sold on the spot=20 market at times of high demand -- won't lower prices for other key componen= ts=20 of the state's energy supply such as electricity bought for the next day's= =20 power needs.=20 ``Suppose you're paying $150 every single (megawatt) hour. That still puts = us=20 in big trouble with wholesale energy costs'' Wolak said.=20 The state already has spent $5.1 billion buying power for customers of=20 California's three largest investor-owned utilities which lost their credi= t=20 -- and thus their ability to buy power -- after paying sharply higher costs= =20 for wholesale energy.=20 Borenstein said paying even $250 a megawatt hour is still preferable to the= =20 unknown particularly since economists have warned that there is virtually = no=20 upper limit to what energy companies can charge.=20 ``This summer we are going to be truly short of power and at those times th= e=20 price is going to be at the price cap and if we don't have a price cap th= ey=20 will be way above the price cap'' Borenstein said.=20 FERC remains opposed to price caps but after months of complaints the boa= rd=20 this week is considering a limited cap on the most expensive last-minute=20 power buys.=20 The proposal would cap California but not the rest of the West and order= =20 wholesalers to sell to the state during the most extreme power shortages.= =20 Though it provides some cushioning it does not address the high prices=20 California swallows the rest of the time. That's the point of Feinstein's= =20 bill.=20 ``The crisis point is this summer to next summer and we need some federal= =20 assistance'' said Howard Gantman spokesman for Feinstein. ``This would=20 assure the generators a reasonable profit and continue to spur on further= =20 investment into new plants.''=20 On the Net:=20 California Energy Commission: www.energy.ca.gov=20 2001 Associated Press ?=20 --- Credit agency cites power troubles lowers state's bond rating=20 Wednesday April 25 2001=20 2001 Associated Press=20 URL:=20 tate0 552EDT0127.DTL=20 (04-25) 02:52 PDT SACRAMENTO Calif. (AP) -- A major credit rating agency h= as=20 downgraded California's state bonds citing the financial drain from the=20 continuing energy crisis.=20 ``The downgrade reflects the mounting and uncertain cost to the state of th= e=20 current electrical power crisis as well as its likely long-term detrimenta= l=20 effect on the state's economy'' Standard & Poors said Tuesday.=20 The state's ability to repay its debts while still considered adequate ha= s=20 been reduced S&P said in dropping the rating on California's general=20 obligation bonds by two notches from AA to A+. It similarly revised other= =20 lease ratings and ratings for the California Health Facilities Constructio= n=20 Loan Insurance Fund known as Cal Mortgage.=20 S&P is one of three major rating agencies watching the state's financial=20 performance. Credit ratings help determine how much states and other=20 borrowers must pay when issuing bonds. The lower the rating the higher the= =20 interest rate the state must pay to attract bond investors.=20 The downgrade now puts California's credit rating behind many other states= =20 and on par with Hawaii which also has an A+ rating from S&P.=20 Preliminary estimates from the state's Treasurer's Office estimated that th= e=20 downgrade would cost the state an additional $190 million to $570 million o= n=20 the $12 billion in general obligation bonds that have been authorized but= =20 not yet issued for ongoing expenses including school and transportation= =20 projects.=20 The agency said the rating was not reduced further because of California's= =20 diverse economy and a proposed revenue bond slated to reimburse the state's= =20 treasury. S&P said a further downgrade could occur if California does not= =20 follow through on plans to issue more than $10 billion in revenue bonds to= =20 pay off its energy-related debts.=20 The agency put the state's general obligation bonds on a credit-watch ``wit= h=20 negative implications'' Jan. 19 shortly after California began buying powe= r=20 for its two largest utilities Southern California Edison and Pacific Gas a= nd=20 Electric Co.=20 On the Net:=20 Standard & Poors www.standardandpoor.com=20 2001 Associated Press ?=20 --- S&P downgrades California's bonds citing energy troubles=20 Wednesday April 25 2001=20 2001 Associated Press=20 URL:=20 ation al0443EDT0483.DTL=20 (04-25) 01:43 PDT SACRAMENTO (AP) -- A major credit rating agency has=20 downgraded California's state bonds citing the financial drain from its=20 continuing energy crisis.=20 ``The downgrade reflects the mounting and uncertain cost to the state of th= e=20 current electrical power crisis as well as its likely long-term detrimenta= l=20 effect on the state's economy'' Standard & Poors said Tuesday.=20 The state's ability to repay its debts while still considered adequate ha= s=20 been reduced S&P said in dropping the rating on California's general=20 obligation bonds by two notches from AA to A+.=20 The agency said the rating was not reduced further because of California's= =20 diverse economy and a proposed revenue bond slated to reimburse the state's= =20 treasury. S&P said a further downgrade could occur if California does not= =20 follow through on plans to issue more than $10 billion in revenue bonds to= =20 pay off its energy-related debts.=20 The agency put the state's general obligation bonds on a credit-watch ``wit= h=20 negative implications'' Jan. 19 shortly after California began buying powe= r=20 for its two largest utilities Southern California Edison and Pacific Gas a= nd=20 Electric Co.=20 On the Net:=20 Standard & Poors www.standardandpoor.com=20 2001 Associated Press ?=20 --- State bond rating lowered=20 Posted at 10:53 p.m. PDT Tuesday April 24 2001=20 BY JENNIFER BJORHUS=20 Mercury News=20 One of Wall Street's top credit-rating houses has downgraded California's= =20 bonds because of the state's handling of the energy crisis a move that cou= ld=20 ultimately cost taxpayers tens of millions of dollars.=20 Saying that mounting and uncertain power costs are likely to do lasting har= m=20 to California's economy New York-based Standard & Poor's on Tuesday lowere= d=20 the state's credit rating on its ``general obligation'' bonds two notches= =20 from AA to A+ with a negative outlook. That puts California near the bottom= =20 of the state bond heap with only one state -- Louisiana -- rated lower.=20 Standard & Poor's said the rating could go lower if the state cannot resolv= e=20 the power crisis.=20 The downgrade will cost California millions of dollars in coming years=20 because a lower rating makes it more expensive for the state to issue gener= al=20 obligation bonds to finance projects such as school construction.=20 The interest on those bonds which will rise from an estimated 5 to perhaps= =20 5.25 percent is paid from the state's tax-financed general fund. Although= =20 the rating change doesn't apply technically to the different type of bond t= he=20 state plans to issue by June for power purchases it will probably make tho= se=20 bonds more expensive for the state too bond experts say.=20 Heightened urgency=20 ``There's a sense of urgency that this problem has been escalating=20 particularly since the PG&E bankruptcy'' said David Hitchcock California= =20 analyst for Standard & Poor's. ``This problem could move quickly.''=20 At least one bond expert said the downgrade was surprising.=20 ``To me it's clear that S&P doesn't have much faith in this power-bailout= =20 plan of the Legislature and the governor. To me that's the reason they did= =20 it'' said Zane Mann publisher of the monthly California Bond Advisor=20 newsletter.=20 No single new piece of information triggered the downgrade Hitchcock said.= =20 The major factor he said was simply spiraling costs and no long-term plan= =20 for paying the bills. Last week Gov. Gray Davis said the state had been=20 spending $73 million a day to buy electricity up from $45.8 million a day = in=20 late March. Hitchcock said some energy traders suspect the actual costs are= =20 higher.=20 All three major Wall Street credit-rating agencies have California on=20 so-called ``credit watch'' but only Standard & Poor's has downgraded. One= =20 municipal bond expert said Standard & Poor's had been ``trigger happy'' and= =20 eager to downgrade. Raymond Murphy Moody's California analyst said he had= =20 no immediate plans to change California's bond rating but that he's anxiou= s=20 to see officials produce a long-term plan for financing power purchases.=20 Murphy said he had a conference call with state officials about the issue= =20 Tuesday morning.=20 ``We want the state to develop the plan that gets the general fund out of= =20 power purchasing'' Murphy said.=20 The state says it's working on that but there's a roadblock.=20 Revenue bonds=20 A major piece of the state's plan is to have the Department of Water=20 Resources issue $10 billion to $14 billion in revenue bonds to pay back the= =20 general fund for what has been taken to buy power in recent months. But tha= t=20 portion of the plan is tied up in a dispute between PG&E and the California= =20 Public Utilities Commission over how to spend the extra money generated by= =20 electricity rate increases. The dispute has also held up the $4.13 billion = in=20 financing the state had arranged to pay down the advances it took out of th= e=20 general fund to buy power.=20 To break the logjam officials from the state treasurer's office have asked= =20 lawmakers to pass emergency legislation to allow the state to issue the=20 revenue bonds.=20 ``California's credit rating and financial strength will be in jeopardy unt= il=20 the state's general fund is repaid for energy costs'' state Treasurer Phil= ip=20 Angelides said in a statement Tuesday.=20 State Finance Director Tim Gage and Gov. Davis both downplayed the=20 significance of the rate change. Through a press officer Davis said the=20 state's economy remains fundamentally strong.=20 The state was downgraded to a lower A rating in 1994 and went on to see=20 tremendous economic growth.=20 Mounting pressure=20 Still a downgrade is bad news that sends a psychological signal in both th= e=20 finance and real worlds. Some industry watchers said they hope the downgrad= e=20 pushes lawmakers and state officials whom they perceive to be too slow in= =20 responding to the crisis.=20 ``It sounds like the bond market might be out ahead of some of the=20 policy-makers in California'' said Severin Borenstein director of the=20 University of California Energy Institute. ``We're facing a real emergency= =20 here.''=20 John Hallacy managing director of municipal research at Merrill Lynch sai= d=20 a lower credit rating puts more pressure on the state to issue the revenue= =20 bonds fast and to conserve cash.=20 ``We're kind of at the critical juncture now where the pieces are still all= =20 over the floor'' Hallacy said of the state's efforts to build and approve = a=20 long-term solution to the power crisis.=20 To Nettie Hoge executive director of the Utility Reform Network and a=20 leading critic of the state's efforts to bail out PG&E and Southern=20 California Edison the downgrade means ``the analysts are watching.'' She= =20 said she hopes that President Bush and the Federal Energy Regulatory=20 Commission are watching too.=20 ``Hopefully this is a wake-up call for FERC. Those guys could solve this i= n=20 a nanosecond'' Hoge said. ``This is just another milepost on the downward= =20 spiral to economic catastrophe.''=20 Contact Jennifer Bjorhus at jbjorhus@sjmercury.com or (408) 920-5660.=20 --- --- ----- Q&A with Gov. Gray Davis on energy issues=20 Gov. Gray Davis visited the Mercury News editorial board Monday. On the=20 subject of electricity Davis talked about increasing the number of power= =20 plants the rejection of price caps by the Federal Energy Regulatory=20 Commission and the condition of the state's two largest utilities Souther= n=20 California Edison and Pacific Gas & Electric. Davis has proposed a deal to= =20 rescue Edison and the Legislature is considering it. PG&E has filed for=20 bankruptcy.=20 Here is a condensed version of Davis' remarks.=20 Q: What would you like to say by way of introduction about the state's=20 electricity problems?=20 Davis: There are really two problems. One is the amount of power available= =20 and the other is the price of power.=20 In 2002 we'll have more megawatts on line at least 5000 more. By 2003= =20 we'll have a slight excess of power over demand. That's very important.=20 Because at the moment we import 20 percent of our power. We have no=20 leverage. We are at the mercy of forces that show no mercy. That will never= =20 change until we have more power than we need.=20 OK price. As you know the only entity that can influence the [wholesale]= =20 price of electricity is the Federal Energy Regulatory Commission.=20 Deregulation surrendered the ability of the state to do that.=20 In 1999 this state for all power including municipal power spent roughly= =20 $7 billion. In 2000 we spent $32.5 billion. I don't know what it will be= =20 this year but it will be substantially higher.=20 Through all this the Federal Energy Regulatory Commission has refused to do= a=20 thing zero zippo. Lest you think I'm being partisan that commission=20 consists entirely of Clinton appointees.=20 The final piece is the financial consequences of what's happened to date. I= t=20 is our hope that if we can keep Southern California Edison credit-worthy an= d=20 able to re-enter the power purchasing market Jan. 1 2003 we can then go t= o=20 the PG&E creditors committee [the generators to whom PG&E owes money] and s= ay=20 to them: ``Look at the arrangement we made with Southern California Edison.= =20 We believe that this is a far better deal than PG&E can give you.''=20 I think this is a fair plan. We get every electron that Edison's utility ow= ns=20 committed for 10 years at a cost-of-service basis. Under [current law] the= y=20 could sell that next March at market rates. We got $400 million returned fr= om=20 the holding company a $3 billion investment in the transmission and delive= ry=20 systems .?.?. a permanent easement on about 20000 acres of environmental= =20 property around all their hydro facilities.=20 Q: Do you have in mind a finished product for the changes that are happenin= g=20 in the electric system? What will it look like in a couple of years?=20 Davis: It is my expectation that the utilities will be purchasing the power= =20 entirely commencing Jan. 1 2003. Our goal is to get them back in business= .=20 In addition to investor-owned utilities I believe we also need a public=20 power authority. At some point I believe the private sector will say to=20 itself ``I want to build new plants to replace the 40-year-old plants but= =20 do I really want to get the state to a 15 percent margin over supply there= by=20 reducing the value of the electrons I already own?'' If they do God bless= =20 them. But if they don't at least we'll have the opportunity to build them= =20 ourselves.=20 Once we have even a slight margin of capacity over demand the spot market= =20 prices will come down dramatically.=20 Q: You said in February that you could have solved the electricity problem = in=20 20 minutes if you'd been willing to raise rates. Now rates are going to be= =20 raised. Should you have favored a rate increase earlier?=20 Davis: I should have been more specific. I should have said I could have=20 solved it in 20 minutes if I wanted to triple rates. I think the rate=20 increase I proposed is fair. It rewards people who are the most energy=20 efficient the people who only use up to 130 percent of their baseline. The= y=20 are approximately half the state. So half the state will see no rate=20 increase beyond the 10 percent that everyone saw in January.=20 Q: Is the state willing to spend anything it costs to keep the lights on o= r=20 at some point would it stiff the generators and just say we will accept a= =20 blackout?=20 Davis: We have to provide power. There are many people who have medical=20 devices that have to keep running. Blackouts can cause deaths traffic=20 accidents all kinds of calamities that I wouldn't want to happen.=20 I'm reluctant to tell the generators we'll pay any price so I'm not going = to=20 say we'll pay absolutely any price but my bias obviously is to find a way = to=20 keep the lights on.=20 Q: When will you reveal how much electricity the state has bought from wha= t=20 companies at what prices and what this will cost the state this year and i= n=20 coming years?=20 Davis: We'll reveal an awful lot of information as soon as the bonds go to= =20 market. [The state plans a bond issue to cover the upfront costs of=20 purchasing electricity.] That information has to be made public. That will= =20 probably be in less than two months.=20 Believe me I don't like going around getting beat up for hiding informatio= n.=20 I'm doing it for one reason only which is that I know every additional edg= e=20 I give the generators will result in higher prices for customers.=20 Q: There's an impression that the state budget is being drained by the powe= r=20 crisis. Is that right?=20 Davis: The simple answer to that is no because the state will be fully=20 reimbursed with interest as soon as these bonds are sold.=20 At the moment in the short term it is crowding out other spending. But I= =20 think everyone understands that's a temporary phenomenon until the state i= s=20 reimbursed by bonds that are repaid over time through the rate structure th= at=20 I proposed.=20 Q: Would it be your pledge that ratepayers not taxpayers will fully repay= =20 the state's cost in purchasing electricity?=20 Davis: That is the assumption underlying these bonds. That's right as it=20 relates to electricity but obviously the conservation incentives came out = of=20 the general fund.=20 Q: Have you talked to President Bush about this?=20 Davis: I hear all these rumors as to why the Bush administration doesn't wa= nt=20 to be helpful but this state and particularly this region has been=20 disproportionately helpful in America's economic growth and technological= =20 productivity. If he wants America to grow it behooves him to keep Californ= ia=20 growing. To date I think it's fair to say that of my public requests=20 President Bush has been responsive to all but the price caps.=20 --- --- ------- Davis: Power surplus by 2003=20 Published Wednesday April 25 2001 in the San Jose Mercury News=20 BY DON THOMPSON=20 Associated Press=20 SACRAMENTO -- Even as power grid operators warned the state's lights could= =20 flicker again by week's end Gov. Gray Davis on Tuesday pledged that=20 Californians will be wallowing in electricity by the end of 2003.=20 Davis compared the emergency to fighting a large forest fire -- in a few=20 years the fire will be out and the state will be out of the energy-buying= =20 business.=20 Just in case Davis' plans fail however an Assembly task force is=20 considering options including having the state buy Southern California=20 Edison.=20 Critics have hammered Davis for his handling of the power crisis and his= =20 predictions have faltered before.=20 In January Davis set three goals as energy prices spiraled upward and shor= t=20 supply endangered the state's large investor-owned utilities: to avoid=20 blackouts bankruptcies and rate increases.=20 All three have since happened.=20 On Tuesday Davis lowered the bar substantially: ``If the lights stay on w= e=20 will have succeeded. Our goal is to keep the power flowing in this state t= o=20 avoid blackouts to moderate the price increases in a fair and reasonable w= ay=20 and reward those who conserve the most and to chart a steady course.''=20 Even keeping the lights on may be difficult as temperatures climb this week= =20 warned the Independent System Operator which runs the state's power grid.= =20 The ISO declared a Stage 2 emergency Tuesday afternoon when the state came= =20 within 5 percent of running out of electricity after two power plants went= =20 off-line unexpectedly.=20 Spring's first warm spell is likely to boost demand by 2000 megawatts -- t= he=20 equivalent of two large power plants able to power 1.5 million homes -- the= =20 ISO said in calling for more energy conservation.=20 The increase comes as hydroelectric power runs low across the dry Northwest= =20 and as 13000 megawatts of power remain unavailable due to planned or=20 unplanned plant shutdowns.=20 Davis insisted that statewide conservation this summer can stave off=20 widespread blackouts as the state rushes to build its way out of the supply= =20 shortage.=20 ``At the end of 2003 we will have more power than we need we will have=20 regained control of our energy destiny'' Davis promised in a speech to the= =20 California Chamber of Commerce. ``By the end of 2003 you can have all the= =20 appliances on. You can you know don't turn anything off you can just=20 luxuriate in all your electricity.''=20 Davis promised a 15 percent supply surplus by 2004.=20 To that end he named former diplomat Richard Sklar to head a new=20 ``generation implementation task force'' of business consultants charged wi= th=20 speeding up power plant siting and construction. Before entering public=20 service Sklar was president of San Francisco-based construction machinery= =20 manufacturer O'Brien Kreitzberg.=20 Standard and Poors dropped California's credit rating Tuesday warning that= =20 continued purchases could hurt the state treasury. --- --- ---------- Great America to avoid blackouts=20 Published Wednesday April 25 2001 in the San Jose Mercury News=20 Associated Press=20 Paramount's Great America amusement park in Santa Clara has struck a deal= =20 with the municipal utility to keep the power on even during rolling blackou= ts=20 this summer.=20 The park will cut electricity usage by 10 percent on ``high-demand days'' -= -=20 which could be nearly every day this summer -- by turning off fountains=20 decorative lighting and air conditioning in some buildings.=20 Santa Clara's city-owned utility Silicon Valley Power will use the power= =20 savings to help avert blackouts said Larry Owens customer service manager= =20 for the utility. Even if the situation gets dire and blackouts are required= =20 the park will be exempt because of the arrangement Owens said.=20 About 20 companies with facilities in Santa Clara including Intel Corp. S= un=20 Microsystems Inc. and Agilent Technologies Inc. have agreed to the same=20 arrangement as has Santa Clara University. --- --- ---------- State's bond rating is lowered=20 The energy crisis brings an A+ designation which likely will mean higher= =20 borrowing costs.=20 April 25 2001=20 By JOHN HOWARD The Orange County Register=20 SACRAMENTO California's electricity crisis prompted a top credit agency to= =20 downgrade the state's credit rating by two notches to its lowest level in= =20 seven years. The move is likely to force the state to pay millions of dolla= rs=20 more in interest when it borrows.=20 It's a statement from Wall Street to California to get your act together= =20 said Assemblyman George Runner R-Lancaster a GOP energy- finance expert i= n=20 the Assembly.=20 The ratings action is serious and should be a warning to the state that it= =20 is on the wrong course added Mark McCray a municipal-bonds manager at=20 Newport Beach-based Pimco. This downgrade will cost the state a lot in ter= ms=20 of increased financing and costs until if ever it is upgraded.=20 Standard and Poor's Corp. concerned about the $5 billion drained from the= =20 state's coffers to buy power this year cut California's credit rating from= =20 AA to A+. The reduction applies to voter-approved bonds called general=20 obligation or G.O. bonds that typically provide funds for schools parks= =20 water projects and highways.=20 About $19.3 billion worth of G.O. bonds have been approved by voters. About= =20 $12 billion have not yet been sold.=20 The credit-rating cut would force the state to pay higher interest rates to= =20 attract buyers to the unsold bonds. If the state were to sell all $12 billi= on=20 under the lower credit rating it could be forced to pay an additional $190= =20 million to $500 million annually in interest depending on market condition= s.=20 Shortly after Standard and Poor's announcement state Treasurer Phil=20 Angelides urged lawmakers to limit the size of the state's looming=20 electricity-bond sale to $10 billion - or $2.4 billion less than Gov. Gray= =20 Davis wants.=20 Angelides said capping the revenue bond at $10 billion would head off legal= =20 challenges from utilities expedite the passage of the bond plan through th= e=20 Legislature and allow the sale to go forward.=20 At a minimum we need an authorization of $10 billion Angelides said. If= =20 Davis and lawmakers want more they should do it later Angelides added.=20 Davis has sought $12.4 billion. The rift between the governor and the=20 treasurer both Democrats marks their sharpest political divergence since= =20 the energy crisis erupted last year.=20 A Davis spokesman declined to comment on the difference. We are working wi= th=20 the treasurer and others to draft legislation for that bond bill and we'll= =20 continue to work with him said Roger Salazar.=20 The Davis administration hopes to raise the money by selling revenue bonds= =20 backed by a charge on consumers' utility bills. The sale had been planned f= or=20 May but has since been pushed back to June or July at the earliest.=20 But there is a clock ticking: The state has been spending $45 million to $6= 0=20 million a day for electricity. The longer the delay in selling the bonds t= he=20 less money will be available to buy cheaper energy for the state under=20 long-term contracts.=20 Before funding future power purchases the bond proceeds must go to pay bac= k=20 the $5 billion the state has spent on electricity purchased since January o= n=20 behalf of California's three big cash-strapped utilities.=20 While the Standard and Poor's downgrade won't directly affect the electrici= ty=20 bonds since they won't be G.O. bonds it does reflect Wall Street's concer= n=20 about the unstanched outflow of state funds.=20 In my mind there's no doubt that S&P is doing this because they simply don= 't=20 have faith in the proposed bailout and what the state is going to have to g= o=20 through to solve its power problems' said Zane Mann the editor of a=20 newsletter that tracks California's general-obligation bonds.=20 Mann said the A+ rating puts California below average nationally. The=20 rating downgrade sliced the value of an existing 30-year California G.O. bo= nd=20 by 3.5 percent he said. But since most investors who buy California bonds= =20 hold them to maturity Mann said the losses would be largely confined to=20 paper.=20 Assemblyman Fred Keeley D-Boulder Creek who authored the bill that=20 authorized the power bonds said the sale should be limited to the $10=20 billion originally provided for in the bill. The bill provides for the=20 utilities to forward money collected from ratepayers to the state Departmen= t=20 of Water Resources which purchases the power.=20 As the state spent more than anticipated on emergency electricity purchases= =20 Davis sought to increase the size of the bond sale. But that suggestion has= =20 led the utilities to challenge the bill's rate- diversion mechanism which= =20 has put a cloud on our ability to acquire financing Keeley said.=20 Assembly Republican Leader Dave Cox of Fair Oaks said he would strongly=20 support any move to cap the amount of borrowing the state would do to buy= =20 electricity.=20 His staff said Republicans are skeptical that the ratepayers' revenues are= =20 sufficient to cover the costs in the Davis administration's electricity-=20 rescue plan.=20 Nobody believes that the revenue stream is wide enough to cover all the=20 governor's energy solutions. It's still being sucked up by the state's=20 utilities said Cox spokesman Jaime Fis Fis.=20 Register staff writers James B. Kelleher and Diana McCabe and the Associate= d=20 Press contributed to this report.=20 --- --- --------------------------- Fire stokes wholesale gas cost=20 The question is whether the retail price will climb too.=20 April 25 2001=20 By ANNE C. MULKERN The Orange County Register=20 The Tosco refinery fire may fuel rising prices on the gasoline retail marke= t.=20 The spot-market price rose 10 cents within hours of the fire. Photo: Leonard Ortiz / The Register ? ? Wholesale gasoline prices jumped Tuesday a day after fire erupted at Tosco= =20 Corp.'s Carson refinery.=20 But energy experts said it is too soon to know whether the fire will drive= =20 retail gas prices higher.=20 Gas prices already are climbing because of increased demand heading into=20 summer higher costs for additives that make cleaner-burning fuel and a shi= ft=20 in marketing strategy by Tosco which wants to sell less gas at a higher=20 price.=20 The refinery fire has the ability to worsen an already bleak situation=20 energy experts said.=20 It doesn't take much in this market'' said Suzanne Garfield California= =20 Energy Commission spokeswoman. It's very volatile.''=20 Tosco said it will shift any lost gasoline production to its Wilmington=20 refinery. It was unclear however how long the Carson refinery would be do= wn=20 for repairs. Tosco spokesman Clark Wrigley couldn't say whether the=20 Wilmington plant could make enough gasoline to meet the company's needs in= =20 Southern California.=20 Within hours of the fire gas prices had jumped 10 cents per gallon on the= =20 spot market a daily market where refiners sell surplus supplies. That was= =20 driven mainly by speculation as those with gas to sell waited to see how= =20 high the price would go. Prices later fell back to an increase of about 3= =20 cents from a day before.=20 Just the fact that there is a hiccup in the refinery makes everyone cringe= =20 and say 'I'm not going to sell''' said Bob van der Valk manager at Cosby= =20 Oil a Santa Fe Springs gasoline wholesaler.=20 A day or so of higher spot prices probably won't affect retail costs. But i= f=20 wholesale prices stay up for several days retailers will pass on those cos= ts=20 to consumers.=20 --- --- --------------------------- Power Companies and Regulators Must Take Steps To Avoid Spread of=20 California Power Virus/ Andersen Analysis WASHINGTON--(BUSINESS WIRE)--April 24 2001 via NewsEdge Corporation - A new virus spawned in California poses formidable challenges requiring new strategies on the part of power companies regulators and policymakers to contain and reverse its damage according to Energy Crisis in the Western United States: Lessons for Navigating Regulatory and Market Minefields a new Andersen report released today. The implications for the development of competitive energy markets go far beyond the Western United States Andersen's national utility practice head Matthew D. Smith told a Washington briefing. Unfortunately California has taught the nation that regulatory and political barriers can create and sustain an energy crisis. California has demonstrated that the risks in the electricity industry if not properly acknowledged and managed can simultaneously and profoundly impact all market participants. To be effectively managed these risks need to be exposed assumed or shared measured and monitored. When they are hidden or ignored all parties can potentially suffer. A shared integrated view of these risks and a strategy for their assumption and management is critical to avoiding rapid value destruction within the energy market Smith said. An Andersen survey of senior utility executives outside California also released at the briefing indicates most utility companies believe they inoculated themselves against the California virus so that it is unlikely to affect their operations beyond slowing the pace of deregulation and increasing investor scrutiny. However based on the potential implications it sees of the California situation Andersen believes a series of booster shots are advisable for power companies and regulators. To deliver reliable service at a predictable cost in today's environment companies must focus on market integration by developing new and innovative relationships between suppliers customers employees and investors -- while working with government officials and regulators to chart a smoother transition to a deregulated power market according to Smith. Eight Implications The Andersen report identified eight overriding implications emanating from the Western energy crisis that are shaping the longer-term operations of the Western grid the regional and national economy domestic energy policy and the industry's evolution: 1. Increased deregulation uncertainty and risk -- Tension and differences between state and federal regulators raise the specter of repeating the regulatory and political conundrum California's investor-owned utilities have faced. If federal initiatives open wholesale markets while retail markets remain regulated a crucial question is raised: Will state regulators pass-through higher wholesale costs if they should materialize? Tensions between state and federal regulators over policies on deregulation will grow if states delay or abandon retail competition. As wholesale markets are deregulated and RTOs begin operating the prudence principles that state regulators have used for many years may have to be changed. For example if FERC and RTO monitors determine that deregulated wholesale markets operate fairly prices derived from those markets must be considered reasonable. If so these costs should be allowed into state-regulated retail rates without regard to the prudence principles state regulators have used for years. Therefore utilities' traditional burden of proving costs are or are not justifiable shifts to regulators. 2. Reduced investor confidence -- Prior to deregulation stringent prudence review and disallowance of generation costs in the rate base made regulatory risk largely uncontrollable killing IOU interests in most new investment. A major purpose of deregulation was to create an environment in which risk could be managed but California's political and regulatory environment provides only a limited ability to manage risks. The confidence and perceptions needed to support investment decision-making will be slow to return given the approach of the state to remedy the crisis. 3. Contributing factor in economic softening -- Uncertain energy reliability and higher costs can drive-out marginal businesses cause healthy companies to constrain expansion and lead new entrants to question whether to make new investments. As such an extended energy crisis contributes to inflation pressures and may slow economic growth. 4. Increased pressure on the Western grid -- Even as capacity increases and demand reductions work to resolve the California crisis these solutions have long-term implications for the Western Grid. These include a realistic possibility of California becoming an energy island as a result of near-term reduction in available regional resources for export to California increased emphasis on security control to protect against overall Western grid failure as sub-regions have problems RTO requirements to strengthen locally available supplies to bolster overall system reliability longer-term development of new plants using plentiful coal resources and clean coal technology will alter the pattern of imports into California and the emergence of Mexico as a major supplier to southern California and Arizona contributing to a bifurcation of the Western Grid into northern and southern markets. 5. Unbundling failures that push companies back to portfolio strategies -- For California investor-owned utilities unbundling has achieved neither the least-cost solution sought by regulators nor value maximization targeted by investors. This necessitates a reevaluation of portfolio management strategies potentially involving generation transmission power trading and marketing and retail businesses in multiple geographies serving multiple markets. 6. Ineffectiveness in changing siting and development restrictions -- California's retail price caps and multiple explanations for the crisis have left accelerated siting processes and environmental standards changes open to challenge by various interests. In addition limiting application of new siting orders only to small generators contributes to uncertainty and investor hesitancy. 7. Procurement management that alters user-utility negotiating leverage -- Competitive markets compel participants -- suppliers marketers large industrial buyers etc. -- to strategically manage procurement as a critical value-driver. Because risk is explicitly shared and always has the potential of shifting advantage to either seller or buyer the sophistication of negotiations and contracts increases as competitive markets evolve. 8. Increased emphasis on distributed generation and new technologies -- California's reliability and price challenges have triggered a re-emergence of energy crisis measures from the 1970s. End-users are investing in solutions they control and the distributed generation market is being aggressively developed among large retailers industrial users and residential customers. This makes possible the development of microgrids connecting consumers in local areas and related changes in traditional grid systems from modifications in interconnection agreements to changing definitions of reserve margins and system reliability. Industry Executives' Response Senior executives from sixteen non-California utilities with a combined market capitalization over $120 billion and $145 billion in revenues responded to an Andersen survey with their views of the implications of the California power crisis for their companies and for the industry. The survey conducted between February 19 2001 and March 2 2001 by Knowledge Systems & Research Inc. of Syracuse found that the companies are observing the California situation carefully expect a slowing -- but not a turnaround -- of deregulation and believe their internal plans and preparations are on-target for the changing environment: -- Deregulation -- Nearly all executives believe recent California events will slow the pace of deregulation over the next five years for states that have not begun or finished writing restructuring legislation. None believe that it will cause advanced states to re-regulate markets although many states will review their legislation to assess their risk of duplicating California's current situation and make any changes necessary to avoid it. -- National legislation -- Few executives suggest the situation will initiate national energy policy/legislation others believe it will be a continuing issue but because of state-to-state variances Congress will be unable to pass any comprehensive measures or force states to a restructuring timeline. Some expect additional state-level legislation. -- Company strategies -- Most do not see any changes to their business models or strategies for generation distribution or supply procurement as a response to the situation in California. However many have expanded their risk management programs reduced spot market purchases begun emphasizing long-term supply contracts planning new power generation capacity and started hedging with futures trades. Those facing price caps are rethinking their stance on them. -- Investor scrutiny -- Many executives indicate their shareholders are aware of the situation and investors -- particularly institutional investors -- are more heavily scrutinizing their actions. Many say news coverage has prompted retail commercial and industrial customer skepticism of industry restructuring. -- Transmission deregulation -- Many executives agree the California situation will increase interest in FERC's regional transmission organizations (RTO) deregulation effort. Utility Company Action Items Both to guard against a sudden California cascade and as a potentially powerful competitive thrust forward-thinking utilities should bolster their basic preparedness with a variety of tactics -- or inoculations -- specifically aimed to combat a potential California power virus according to Andersen partner Mark Moskovitz: -- Improve procurement management and risk management capabilities -- To manage exposure to volatile supply and demand shifts organizations must be sure that comprehensive and clear supply procedures controls decision points risk limits and communications are in place. -- Plan and design innovative rate and pricing structures -- Companies and regulators must focus on communicating price signals that create value for both the customer and the provider. Innovative rate and pricing structures that more closely tie the customer's price to the real cost of supply will better signal the value of the service as well as providing more accurate information upon which both end user and supplier can make decisions. -- Increase emphasis on demand side management (DSM) strategies -- In addition to new pricing strategies to help achieve and maintain supply-demand equilibrium companies must now focus on employing more extensive and innovative demand side management programs. These programs may offer significant benefits with limited risk to both the customer and energy supplier. -- Assess the supply and generation dynamics in adjacent jurisdictions -- Companies must take a broader view -- beyond typical geographic market definitions -- of the economics of generation and related business decisions in an increasingly volatile market in which supply will follow the best prices. -- Develop contingency plans for the continued deferral of new generation capacity -- In the face of potential ongoing generation capacity shortages companies and regulators must be prepared to move with a portfolio of strategies to meet demand including for example DSM flexible pricing and distributed generation. In addition they should explore efficiency-improving upgrades to existing facilities and seize any opportunity to accelerate near-term construction plans. -- Proactively address potential organizational disruption -- As regulatory and economic changes continue to churn the industry waters and companies adjust and/or restructure they must be highly cogniscent of sensitive to and directly address employees' concerns with information about the company's future and theirs'. Industry/Regulatory Lessons There are also a number of broad primary lessons the electric power industry -- nationally and internationally -- should take away from its first major domestic test case in deregulation and restructuring according to Andersen principal David O. Jermain: -- Simplify market design. -- Build a continuing role for regulators. -- Maintain communications with multiple constituent interests. -- Prepare contingency plans for extreme stress conditions. -- Couple real-time retail pricing with transparently priced wholesale competition. -- Provide special incentives for RTO investment formation and development. -- Break down regulatory and political barriers to market signals and responses. Andersen is a global leader in professional services. It provides integrated solutions that draw on diverse and deep competencies in consulting assurance tax corporate finance and in some countries legal services. Andersen employs 85000 people in 84 countries. Andersen is frequently rated among the best places to work by leading publications around the world. It is also consistently ranked first in client satisfaction in independent surveys. Andersen has enjoyed uninterrupted growth since its founding in 1913. Its 2000 revenues totaled US$8.4 billion. Learn more at www.andersen.com. Copies of the Energy Crisis in the Western United States: Lessons for Navigating Regulatory and Market Minefields report can be obtained at A PDF copy of the report can be obtained by contacting Melanie Fahey at 713/222-1600 or mfahey@sommersassoc.com CONTACT: Sommers & Associates Houston | Tom Sommers 713/222-1600 |=20 tsommers@sommersassoc.com |=20 or | Andersen Houston | Melissa Spradley 713/237-2385 |=20 --- --- Soaring Temperatures Produce Call for Conservation=20 California ISO Also Announces New Outage Notification System and On-call=20 Number FOLSOM Calif.--(BUSINESS WIRE)--April 24 2001 via NewsEdge Corporation - As the mercury climbs this week the California Independent System Operator (California ISO) is reminding consumers to curb their electricity use in order to minimize the strain on the power grid. The first warm spell of the season is expected to cause temperatures to jump 10 degrees leading to a 2000 megawatt increase in electricity consumption -- the equivalent of two large power plants. The week started out with a peak demand of 28835 megawatts but by tomorrow it is forecasted to top 30500 megawatts. This comes as hydroelectricity resources (both Northwest and California) run low more than 10000 megawatts of power plants remain off line due to planned and unplanned maintenance and some 3000 megawatts of Qualifying Facilities or alternative energy suppliers are not operating. The California ISO's renewed call for conservation precedes a forecast of 90 degree highs in the inland areas that may tempt many Californians to flip on air conditioners. For conservation tips -- such as using fans instead of air conditioners setting thermostat at 78 degrees etc. -- please see the California ISO's web site www.caiso.com. New Notification System: With a challenging summer around the corner the California ISO wants to do all it can to bring information to the public as quickly as possible. For that reason a new notification system is being brought on line. Media and the public can now access the Internet to keep current if rotating blackouts are issued. Navigation: Visit www.caiso.com Click on System Conditions for current information on rotating outages (will appear only when activated) For previous outage information (last hour etc.) click on Market Notices scroll to bottom of page and click on Notice Log The California ISO is also testing a new service to notify newsrooms immediately by email should the ISO initiate electrical emergencies (Stage One - Three) or rotating outages. If you would like to participate please email kwerst@caiso.com with a maximum of one email address per newsroom. Additionally a single on-call media pager number has been established: 916/815-0679. To make it easier on media ISO Communications will no longer be posting on-call schedules for media spokespersons on the web site. Simply call the on-call pager after hours. News releases alerting the media to electrical emergencies will continue as will news conferences held on-site in Folsom and via telephone. As a reminder if you wish to visit the ISO control rooms (in Folsom or Alhambra) always call ISO Communications first at 888/516-NEWS to make an appointment. Access to the control rooms may be limited on certain days depending on system conditions and/or level of requests from media. CONTACT: California ISO | Patrick Dorinson 888/516-NEWS | Media Hotline:= =20 888/516-NEWS What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: United Way Body:: I think the message Christi prepared is great. Check with her one last time and then let it go. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Privileged & Confidential -- Verification Body:: nan What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: H&M Roses, Inc Body:: ok Janel Guerrero 03/13/2001 08:04 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: H&M Roses Inc Steve....unless you think it's a potential problem I'd like to include the CA flower grower in our list of businesses to target with ken's letter. (You handed me the letter from H&M Roses Inc today). Let me know. thanks. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: You Can Put A Stake in Their Hearts but They Never Die Body:: Here's the proposal to form the Team. Note that the complete team list includes: =01&The MRT will be led by Philippe Auclair and will include Market Partic= ipant=20 Advisor (MPA) Eric Woychik Market Assessment Advisor (MAA) Steven Stoft and any others= =20 appointed by the Board.=20 =01&The Market Design Group may be comprised of a number of national expert= s on=20 energy market structure and regulation and to be used as needed by the MRT. Sever= in=20 Borenstein Joe Bowering (PJM=01s Market Monitor) William Hogan Paul Joskow and Fra= nk=20 Wolak have all expressed their willingness to assist the ISO Board through the Market Repa= ir=20 Team.=018 Does anybody have a read on Bowering from PJM? Alan Comnes Susan J Mara@ENRON 03/13/2001 03:06 PM To: Richard Shapiro/NA/Enron@Enron James D Steffes/NA/Enron@Enron Joe=20 Hartsoe/Corp/Enron@ENRON Jeff Dasovich/NA/Enron@Enron Sandra=20 McCubbin/NA/Enron@Enron Alan Comnes/PDX/ECT@ECT Tim Belden/HOU/ECT@ECT= =20 Mary Hain/HOU/ECT@ECT Steven J Kean/NA/Enron@Enron Steve=20 Walton/HOU/ECT@ECT Christi L Nicolay/HOU/ECT@ECT cc: =20 Subject: You Can Put A Stake in Their Hearts but They Never Die Gang Just heard from someone at the ISO that the ISO Board is shoving a new mark= et=20 approach down the staff's throat. Rising from the almost dead ... This Market Repair Committee is supported by Eric Woychik advisor to Boa= rd=20 Member Florio. The Committee members are Joskow Hogan PJM people et=20 cetera et cetera. There will be something posted on the ISO's web site=20 shortly. It will be approved at the Board meeting Thursday. I'll be there. Sue Mara Enron Corp. Tel: (415) 782-7802 Fax:(415) 782-7854 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Follow up Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Got your message. I'm testifying at the Congressional hearing and Dasovich is covering FERC. I think Jeff's comments were taken out of context. He said policymakers do need to take care of small customers whose bills are tripling. Frankly we'd get slaughtered if we said anything else. But he also said there is a right way and a wrong way to do it. Enron and others had provided a market based answer by offering a fixed price deal to SDG&E (which would have enabled them to cap rates to those who had not switched. California elected instead to cap rates and deficit spend (ie create a deferral account). I don't think we can stand for anything that doesn't protect the small customers but we can continue to emphasize the market based solutions. One of the messages in my testimony will be: customers should be encouraged to choose. Those who did are doing fine. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: TALKING POINTS UC/CSU Body:: Please post on internal site What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re:Energy Bar conference Body:: When we talked about me speaking at the conference in Nov. Enron's management conference had not yet been scheduled. Now it has and of course it conflicts... it also conflicts out just about every other senior person at Enron. I will take care of finding a substitute but wanted your thoughts on a couple of candidates: how about Seabron Adamson Richard Tabors or Scott Magrane(sp?). The latter is at Goldman Sachs and last time I talked to him was working on Transcos. Let me know what you think and let me know who you were working with at FEBA so I can take care of the problem. Thanks What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Lou Pais staff meeting, 25C3. Body:: Maggie's Birthday party tonight Bill Hogan (617) 495-1317 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: National Governors Association - Springtime in Washington Reception Body:: 6:15 p.m. to 8:30 p.m. Contact is Alva Hines 202-624-5325 - not going unless going to be in DC already What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Truck Wreck on 2/28 Involving Cummings and an Ex-EOTT Driver; CONFIDENTIAL AND PRIVILEGED ATTORNEY/CLIENT COMMUNICATION AND ATTORNEYS WORK PRODUCT Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Chairman Tauzin on Negawatts Body:: Today's Washington Post contains a favorable comment on negawatts attributed to House Energy & Commerce Committee Chairman Tauzin following efforts we made yesterday with the Chairman and his staff both directly and via our consultants. The Post article reads In the coming months Tauzin said Congress will take steps to allow consumers to sell power back to their local energy grids. We of course will continue to push for a version of this concept that keeps this process open to multiple buyers and sellers not just the local utility. The article dovetails with information directly from Chairman Tauzin and Chairman Barton that they will continue to push our demand buydown proposal although we are working with them to shore up support on the committee in the face of opposition from the usual suspects. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: MOU With India Oil Corp. Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Wed 6/6: Businesses vie for blackout exemptions:=20 The PUC must decide who should be spared and the applicant list is very lo= ng Sac Bee Wed 6/6: PG&E ISO agree to court order on power bills Sac Bee Wed 6/6: Peter Schrag: Turning up the heat in Houston and=20 Washington (Editorial) SD Union Wed 6/6: Is trading an insider's game? SD Union Wed 6/6: Daily energy costs for state fall in past weeks=20 SD Union Wed 6/6: Five tiers sought in proposed rate boost SD Union Wed 6/6: Port budget large but power bills loom SD Union Wed 6/6: Continuous use urged for planned power plant=20 SD Union Wed 6/6: Rising energy prices threaten Poway troupe=20 SD Union Wed 6/6: Fair to use generators for midway attractions LA Times Wed 6/6: 'Hi My Name Isn't Justice Honey' and Shame on Lockye= r =20 (Editorial) LA Times Wed 6/6: U.S. Probes Alleged Pact Not to Build New Plants Power:= =20 Justice officials focus on Southland operations of two firms which deny=20 wrongdoing LA Times Wed 6/6: Natural Gas Power Prices Drop Sharply Energy:=20 More conservation mild weather are among factors keeping costs down exper= ts=20 say LA Times Wed 6/6: The State Utility Averts $1 Billion in Costs Courts:=20 PG&E and Cal-ISO agree to recognize Department of Water Resources as=20 purchaser of the power SF Chron Wed 6/6: Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited SF Chron Wed 6/6: San Jose council gives green light to generating plant= =20 VOTE REVERSAL: Officials pressured to OK project SF Chron Wed 6/6: Developments in California's energy crisis SF Chron Wed 6/6: California conserves SF Chron Wed 6/6: L.A. power customers awash in cheap energy SF Chron Wed 6/6: PG&E doesn't want to pay for energy to avert blackouts Mercury News Wed 6/6: Metcalf plant gets preliminary approval=20 OC Register Wed 6/6: Feds probe AES Williams Individual.com (PRnewswire) Wed 6/6: Calpine Begins Construction of=20 Peaking Energy Center in Gilroy Calif.=20 Individual.com (PRnewsire) Wed 6/6: Reliant Urges FERC to Drop or Amend= =20 California Price Caps to Avoid Additional Shortages and More Blackouts Energy Insight Wed 6/6: Farm-fresh biopower --- Businesses vie for blackout exemptions: The PUC must decide who should be= =20 spared and the applicant list is very long. By Carrie Peyton and Dale Kasler Bee Staff Writers (Published June 6 2001)=20 Mixes for milkshakes and frozen coffees could spoil at ice cream parlors= =20 sickening customers.=20 Seniors getting their hair done would have to leave their dryers and go hom= e=20 with wet heads risking a chill.=20 Mall escalators could come to a sudden halt endangering shoppers who lose= =20 their footing.=20 Those are among the health and safety risks cited by more than 10000=20 businesses and government bodies asking state regulators to exempt them fro= m=20 rolling blackouts.=20 It is a list that mixes nursing homes and grocery stores outpatient surgic= al=20 clinics and beauty salons dialysis centers and country clubs.=20 A lot of people are treating this like a lottery said Subodh Medhekar of= =20 Exponent Inc. the consulting firm sorting through exemption requests for t= he=20 state Public Utilities Commission.=20 For many Medhekar said the rationale seems to be 'I'm pretty sure I won= 't=20 get exempted but what's the down side? Let's put in an application.' =20 Amid predictions that Californians could face dozens of rolling blackouts= =20 this summer state regulators are trying to update a decades-old list of wh= o=20 should be spared if the lights go out.=20 The Alta Sierra County Club in Grass Valley should be among those whose pow= er=20 stays on Sean O'Brien the club's golf course superintendent told=20 regulators in a nine-page application.=20 The country club telephones could go out making it harder to phone for hel= p=20 if someone has a medical problem while golfing he said in an interview.=20 And if the golf course's irrigation pumps shut down it would lose the=20 ability to quell small blazes -- leaving it to rely on a fire station O'Bri= en=20 said is about one-quarter mile away.=20 Placerville Dialysis wants an exemption too. As many as a dozen people the= re=20 can be having their blood pumped through an artificial kidney that cleans i= t=20 when their own kidneys no longer function properly.=20 When the power goes out everything just stops said manager Shirley=20 Carpenter. There is a way to manually return the blood by hand before it= =20 clots in the line. ... It would just be hectic.=20 It takes about five minutes of manual pumping to fully disconnect someone= =20 from a dialysis machine Carpenter said. And some patients can help by=20 operating their own pumps.=20 But she said I'm sure it would be kind of frightening to have your blood= =20 out in the line and the power off and they're pretty much tied to the=20 machine.=20 Pam Chin a hairdresser at the Loomis Beauty Salon said the owner sought a= n=20 exemption because people could get overheated if the air conditioning went= =20 out and older customers getting their hair set could be chilled if the=20 dryers shut off.=20 With about half the state already exempt from rolling blackouts the questi= on=20 of who else should stay connected has become a delicate one for utilities= =20 regulators and legislators.=20 Carl Wood the PUC commissioner who has taken the lead on blackout issues= =20 estimates that fewer than 1000 more utility customers can be exempted befo= re=20 they overload the rolling outage system designed to take stress off the=20 electric grid.=20 While about 6000 customers are classified as essential by the state's tw= o=20 largest utilities keeping them out of the blackout rotation also spares=20 about 5 million other customers who are served by the same circuits.=20 That multiplier effect will have to be weighed by the consulting firm by= =20 utilities and eventually by PUC commissioners who are scheduled to vote in= =20 early August on who should be added to existing standards.=20 The rules will apply to the state's investor-owned utilities Pacific Gas a= nd=20 Electric Co. Southern California Edison and San Diego Gas & Electric Co.= =20 but not to municipal utilities.=20 The Sacramento Municipal Utility District already rejected pleas for specia= l=20 exemptions from a medical lab a veterinary hospital nursing homes medica= l=20 facilities businesses and residents. SMUD believes they can weather=20 blackouts because they are not critical to public safety.=20 People have counted on having dependable electricity for so long that some= =20 have widely varying ideas of who can do without it safely Medhekar said.= =20 Of the more than 500 Baskin Robbins ice cream parlors that dot California= =20 only five are listed on the PUC Web site as applicants for exemptions.=20 The site cautions that its list of 9239 electronic applicants hasn't been= =20 checked for duplicates -- or fiction. It includes hundreds of outlets of th= e=20 same drug store and supermarket chains dozens of related nursing homes and= =20 more than 400 dentists. Another 1200 commercial power users have applied b= y=20 fax.=20 Among those who have confirmed they want out of outages are the grocery=20 chains operated by West Sacramento-based Raley's which said it took the=20 action as part of united effort with all California grocers who are worrie= d=20 about food spoilage.=20 Others in the mix are Fairfield's Westfield Shoppingtown Solano formerly t= he=20 Solano Mall where officials sought the exemptions out of fear that shopper= s=20 would get injured if escalators came to a sudden halt.=20 The Yolo County Housing Authority asked for an exemption on behalf of its 7= 00=20 dwellings in the belief that the utilities offer exemptions for low-income= =20 Californians Executive Director David Serena said.=20 Serena added that many of the authority's occupants are older or disabled a= nd=20 could be endangered by a blackout.=20 Chevron Corp. acknowledged it couldn't show that a blackout at its refineri= es=20 would present imminent danger to public health or safety but it asked Go= v.=20 Gray Davis to support legislation exempting makers and transporters for=20 critical fuels saying a refinery shutdown would cut into the state's=20 gasoline supply.=20 Some businesses acknowledged that their applications are a long shot.=20 It's probably a stretch said Amanda Leveroni who owns Bacio Catering Co= .=20 of Chico about her request to the PUC. The public wouldn't be in danger.= =20 But we're a catering company -- somebody has planned for a year-plus for a= =20 wedding or some big event she added. I would be in such a huge situation= .=20 I'd have to send out for pizza.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com. PG&E ISO agree to court order on power bills By Claire Cooper Bee Staff Writers (Published June 6 2001)=20 SAN FRANCISCO -- Pacific Gas and Electric Co. and the operator of=20 California's power grid agreed Tuesday to a preliminary court order providi= ng=20 that the utility will continue to receive -- but not pay -- generators' bil= ls=20 for the state's purchases of the most expensive wholesale electricity.=20 The tab has been running at about $300 million a month.=20 The order which U.S. Bankruptcy Judge Dennis Montali said he'll sign will= =20 specify that the Independent System Operator will not procure power except= =20 for a creditworthy buyer who has agreed to pay the generator.=20 In California the only such potential buyer is the state Department of Wat= er=20 Resources. However the department which has avoided PG&E Co.'s bankruptcy= =20 proceedings by claiming sovereign immunity will not be controlled by the= =20 agreement. Montali pointed out that the department still could demand=20 reimbursement from PG&E.=20 Under the agreement the ISO will not press any claims against PG&E on beha= lf=20 of generators if they are not paid.=20 The proposed preliminary injunction was based on an April order by the=20 Federal Energy Regulatory Commission which forbade the ISO from purchasing= =20 power on behalf of any non-creditworthy buyer such as PG&E.=20 The ISO is appealing the FERC order. If the appeal succeeds the injunction= =20 will end.=20 Peter Schrag: Turning up the heat in Houston and Washington (Published June 6 2001)=20 Behind all the palaver about the predictable standoff at last week's energy= =20 summit between President Bush and Gov. Gray Davis one major political=20 development was missed.=20 Put simply in the past month the focus of the California energy crisis an= d=20 maybe the onus as well has moved east: from the state's (and Davis')=20 handling of the mess to the generating companies energy marketers and gas= =20 pipeline companies that have richly profited from it and thus to FERC the= =20 do-next-to-nothing Federal Energy Regulatory Commission and the Bush=20 administration.=20 That wasn't all Davis' doing -- far from it -- though it's been at the hear= t=20 of his message about energy industry pirates and profiteers. Bush's=20 misbegotten energy plan and the administration's political clumsiness also= =20 contributed mightily not least by inadvertently giving Davis the chance to= =20 get media exposure he could only have dreamed about.=20 More important there's the defection of Sen. James Jeffords from the=20 Republican Party and the resulting shift of control in the U.S. Senate whe= re=20 the next chair of the Energy Committee will be Sen. Jeff Bingaman of New=20 Mexico a co-sponsor of Sen. Dianne Feinstein's bill capping wholesale=20 electric rates for the next two years. And chairing the Committee on=20 Governmental Affairs will be Sen. Joseph Lieberman of Connecticut who's=20 already asked for an audit of energy prices.=20 Those changes will draw a lot more attention to recent studies showing that= a=20 handful of big generators -- Duke Power Reliant Mirant Dynegy and the hu= ge=20 energy-marketing firm Enron -- have gamed the market to drive wholesale=20 prices to levels that in the year 2000 sometimes reached 40 times the=20 prices of the year before.=20 The findings come not merely from economists at the California Independent= =20 System Operator the agency that manages the state's grid who estimate=20 overcharges resulting from market power at $6.2 billion for last year alone= .=20 They come also from Severin Borenstein and his colleagues at the University= =20 of California Energy Institute who conservatively calculate the=20 overcharges at $4.5 billion from Paul Joskow a widely respected energy=20 economist at MIT and from Edward Kahn an economic analyst in San Francisc= o.=20 In a recent paper published by the National Bureau of Economic Research=20 Joskow and Kahn conclude that there's considerable evidence that the high= =20 prices experienced in the summer of 2000 reflect the withholding of supplie= s=20 from the market by suppliers [generators or marketers] exercising market=20 power. That those high prices occurred not merely during peak usage but al= so=20 at off-hours when no one had ever seen a price spike before makes those= =20 spikes even more curious.=20 There is in addition the powerful suspicion that the huge increase in=20 natural gas prices that a subsidiary of El Paso Energy Co. now the largest= =20 gas company on Earth was charging on the California side of the=20 California-Arizona border wasn't merely the result of an innocent imbalance= =20 between supply and demand.=20 None of that may be illegal. If there's no collusion there are no violatio= ns=20 of antitrust laws. But it adds plenty of steam to the political argument. I= n=20 the 2000 election cycle alone energy companies kicked in some $64 million = in=20 political contributions 75 percent of it to Republicans. At a time when=20 those companies many of them located in the same Houston neighborhood are= =20 racking up astronomical profits and when their collective coziness with Bus= h=20 and the Republican Party is a lot more than rhetoric their vulnerability t= o=20 a vigorous Senate investigation ought to be obvious.=20 The clincher is Blackout a Frontline program that both symbolizes the= =20 shifting emphasis and reinforces it. (The program is scheduled to be aired = at=20 8 p.m. Friday on Sacramento cable Channel 7.) It isn't another recital of= =20 Californians worrying about their electric bills or about the stupidity of= =20 the state's deregulation scheme or how Davis dithered in addressing the=20 crisis. It is about those generators and marketers in Houston and North=20 Carolina men (and a few women) who regard themselves as the heroes of the= =20 new energy markets.=20 The piece is reported by Lowell Bergman who in working for both Frontline= =20 and the New York Times has already broken major print stories about Duke=20 Power's secret approach to Davis offering unspecified energy refunds in=20 return for an end to state investigations and lawsuits. Bergman also report= ed=20 private conversations between Enron chairman Kenneth Lay a major Bush=20 supporter and FERC chairman Curt Hebert regarding the influence that Lay= =20 could exercise with Bush to allow Hebert to keep his chairmanship if Hebert= 's=20 supported certain decisions Enron badly wants.=20 None of these recent events is likely to end Davis' political woes and the= y=20 may not produce the wholesale rate caps Feinstein wants and that most=20 economists think necessary -- or maybe any significant reduction in the=20 industry's predatory pricing. But they will surely help turn up the heat= =20 both in Houston and Washington. Six months ago FERC found wholesale prices= =20 were not fair and reasonable as federal law requires but did little abou= t=20 them. It will now have a lot more questions to answer.=20 Peter Schrag can be reached at Box 15779 Sacramento CA 95852-0779 or at= =20 pschrag@sacbee.com. Is trading an insider's game?=20 Buying selling of electricity is a growth business but some say deck is= =20 stacked against consumers By Craig D. Rose=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 While Californians decry deregulation's failure to deliver a competitive=20 market electricity wholesalers have quietly developed a vast and rapidly= =20 growing business of buying and selling power among themselves.=20 The deals take place on high-tech trading floors in Houston and elsewhere= =20 around the country as well as on Internet-based trading systems.=20 Some experts say this electricity trading is a key mechanism for raising=20 consumer power prices yet it's largely unregulated.=20 Electricity trading is like buying stock -- when you have ability to chang= e=20 the stock price said Frank Wolak a Stanford University economics profess= or=20 and member of the state grid operator's market surveillance group.=20 Energy companies say the buying and selling of contracts to deliver power= =20 provides risk management allowing plant owners to presell their electricit= y=20 lock in prices and avoid fluctuations. The rough and tumble of the free=20 market they add is the most efficient means of allocating a resource like= =20 electricity.=20 But industry critics say trading is far from a competitive market paradigm.= =20 In their view it's a means of communication -- a way for energy insiders t= o=20 collude and raise prices under the guise of competition.=20 To be sure the trading arms of major energy companies have emerged as star= s=20 in an industry where profit surges of 300 percent or 400 percent are not=20 uncommon.=20 The transactions shrouded in secrecy can leave ownership of a critical=20 commodity in unknown hands. Consider the case of power generated by AES=20 Corp.'s California plants.=20 In 1998 AES made a bold move. Immediately after purchasing power plants th= at=20 gave it control of 10 percent of the state's electric generating capacity= =20 the company sold the output from its plants for the next 20 years to Willia= ms=20 Cos.=20 Williams did not sit on this treasure trove of electrons. The Tulsa Okla.= =20 company soon sold 80 percent of what it bought.=20 It is difficult to say who owns that power now. Some might be owned by Semp= ra=20 Trading a sister company of SDG&E. Or some could be owned by Enron Corp.= =20 the nation's biggest electricity trader.=20 A spokeswoman for Williams conceded that Williams itself may have repurchas= ed=20 some of the electricity it sold earlier. But trading companies closely guar= d=20 their positions.=20 This much can be said with certainty: Electricity that AES sold for less th= an=20 5 cents per kilowatt-hour to Williams changed hands perhaps 10 times in the= =20 wholesale market and emerged at times in recent months with a price tag for= =20 consumers that was 300 percent higher.=20 Williams' trading profits increased by 523 percent in the first quarter thi= s=20 year. Advance sales All this buying and selling creates curious confluences.=20 In their attempt to deflect criticism over high prices generating companie= s=20 such as Duke Energy -- operator of the South Bay Power Plant in Chula and= =20 others in the state -- frequently note that they sell most of their=20 electricity far in advance. But they acknowledge less often that their=20 trading units may also be buying power which could boost the company's=20 electricity inventory.=20 Duke was the fourth biggest electricity trader last year and cited its=20 trading activity as a prime contributor to its wholesale business profits= =20 which soared 324 percent in the first quarter to $348 million.=20 It is a company's power traders who frequently direct plant operators to=20 increase or decrease the generation of power in response to market=20 conditions.=20 Energy companies have little option but to turn to trading for profits. One= =20 of the better kept secrets of electrical deregulation and its promise of=20 competition is that there is remarkably little competition in the productio= n=20 side of the business.=20 For one thing electricity is a commodity power from one company is=20 indistinguishable from that generated by others.=20 More important nearly all modern plants generate power from turbines built= =20 by a handful of manufacturers. The result? Modern plants owned by different= =20 companies produce power at nearly identical cost.=20 The cost of power produced by modern plants is all within a mil=20 (one-thousandth of a dollar) said Michael Peevey an adviser to Gov. Gray= =20 Davis and former president of Southern California Edison.=20 So the extraction of profit in the electricity business relies much more on= =20 trading. Traders' profits rise when prices are volatile -- plunging or eve= n=20 better rising sharply. Little regulation But despite the obvious temptation to manipulate the market the burgeoning= =20 electricity trading business has remained largely unregulated.=20 The Federal Energy Regulatory Commission does require quarterly filings fro= m=20 energy traders but these often provide incomplete information or at least= =20 little that has been of concern to FERC.=20 In fact although the trading of electricity grew more than a hundredfold= =20 from 1996 to 2000 FERC has taken no major enforcement action against a=20 trader. After the onset of the California crisis last year FERC has acted= =20 once. That was against Williams which agreed to pay $8 million without=20 admitting guilt to resolve an allegation that it withheld supply to pump up= =20 prices.=20 FERC's record of enforcement in the area of power trading stands in contras= t=20 to a long list of enforcement actions within other markets taken by the=20 Securities Exchange Commission and the Commodity Futures Trading Commission= .=20 FERC has recently added staff to its market oversight operations. But Willi= am=20 Massey a FERC commissioner says the agency's effort is still inadequate.= =20 Electricity can be flipped stripped and chopped up Massey said. It's a= n=20 extraordinarily complicated market.=20 The sophisticated marketers and traders have simply moved past us. We're= =20 kind of horse and buggy in our approach and they're out there in rocket shi= ps=20 flying around ... The problem is that sophisticated traders don't necessari= ly=20 produce reasonable prices. They produce profits.=20 Before deregulation electricity trading was a low-key affair. Regulated=20 utilities dealt power back and forth on a reciprocal basis to fill=20 electricity shortfalls in their control areas. There was little trading for= =20 profit until the mid-1990s after federal legislation and FERC rulings open= ed=20 the market.=20 Major traders include large energy companies sister companies of=20 California's major utilities and Wall Street firms. Market volatility In many ways the trading of power is similar to that of other commodities.= =20 But there are important differences. Because it cannot be stored and its us= e=20 is so fundamental the price of electricity is the most volatile of all.=20 When supplies are tight a single supplier can rapidly raise prices to=20 budget-busting levels as evidenced by Duke Energy's recent admission that = it=20 charged California nearly $4000 for a megawatt-hour of power a quantity= =20 that probably sold hours earlier for one-tenth of that sum or less.=20 Wolak the Stanford economist and state Sen. Joseph Dunn D-Garden Grove= =20 who is investigating the state power market say trading allows companies t= o=20 collude under the guise of competition. Instead of wringing out lowest cost= s=20 the wholesale trading market serves to raise prices they say.=20 As I trade to you and you trade to me we communicate to each other what= =20 price we would like to get said Wolak. It's not collusive. It's just=20 communicating price.=20 Mark Palmer a spokesman for Enron the nation's biggest power trader said= =20 California's problem is not the result of trading.=20 It's a result of shortages Palmer said.=20 Underscoring its emphasis on trading Enron's new headquarters tower in=20 downtown Houston rises from a six-story block of new trading floors=20 including expanded space for electricity trading.=20 Enron also pioneered trading in cyberspace and its Enron Online site claims= =20 to be the most active computer-based trading market.=20 The Houston company argues that consumers won't fully benefit from power=20 trading and deregulation until they have greater choice in choosing their= =20 power supplier. And the company says FERC has not done enough to open acces= s=20 to transmission lines which would allow traders to move power around the= =20 country. To that end Enron has lobbied hard for President Bush's plan for = a=20 national electricity grid.=20 Palmer says the notion that the price of electricity rises each time it is= =20 traded is mistaken.=20 The market is always looking for the real price of a commodity Palmer=20 said.=20 Dunn the California state senator says his investigation found a differen= t=20 function for trading. At a time when supply barely meets or falls short of= =20 demand he noted companies with electricity to sell have to worry only abo= ut=20 how high to set their price.=20 The trader is a pawn in the generator's game to drive up prices said Dun= n.=20 Trading develops a level of trust. You my alleged competitor will bid in= =20 the same patterns and I will respond not in a competitive pattern but in a= =20 complimentary pattern.=20 The state senator said his investigation found evidence that on several day= s=20 energy companies appeared to test their ability to drive prices up without= =20 being undercut by competitors.=20 This ability to drive up prices without competitive consequence is a key te= st=20 of market power the technical term for manipulation or price fixing.=20 But Dunn also conceded that antitrust violations can be hard to prove in=20 court. He suggested that even if the trading behavior falls short of=20 antitrust violations it remains anti-competitive and devastating for the= =20 California economy.=20 To Harry Trebing a utility industry expert and professor emeritus at=20 Michigan State University wholesale electricity trading is reminiscent of= =20 what took place in the 1920s and early '30s. Back then utility companies= =20 created complex networks of holding companies that traded stock among=20 themselves driving up prices in the process.=20 Undoing that scheme was a focus of President Franklin Roosevelt's=20 administration. Congress ended up barring national power companies and=20 tightening regulation of utilities in an effort to counteract their tenden= cy=20 to create markets that work only for insiders.=20 The broad goals of trading are the same Trebing said.=20 The goal is to maximize profits through raising prices.=20 Daily energy costs for state fall in past weeks=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 SACRAMENTO -- In some of the first good news of the electricity crisis the= =20 Davis administration said yesterday that the daily cost of power purchased = by=20 the state for utility customers has dropped in recent weeks.=20 The price-drop news comes after an announcement that Californians conserved= =20 more energy than expected last month 11 percent and amid Davis=20 administration optimism that the Legislature may finally begin to move on a= =20 plan to keep Southern California Edison out of bankruptcy.=20 The developments if they turn out to be a trend and not temporary could b= e=20 among the first signs that Gov. Gray Davis' plan to end the electricity=20 crisis is beginning to work. But the administration isn't saying that.=20 We have had a few good days here lately said S. David Freeman a Davis= =20 power adviser. I don't think that I want to project.=20 Some power-market watchers began to speculate last month that prices may ha= ve=20 peaked earlier this year. Platts an energy information service said=20 yesterday that spot prices for the natural gas used by power plants are=20 falling this month.=20 The governor's press secretary Steve Maviglio told reporters yesterday th= at=20 the daily amount spent on power is now well below $50 million which was= =20 the average cost earlier this year.=20 A 12-day gap in the most recent notice to the Legislature that another $500= =20 million increment will be spent on power suggests that the daily average=20 during the last two weeks may have dropped down around $42 million.=20 Oscar Hidalgo a spokesman for the state power purchasing agency said that= =20 the average cost of power was under $40 million during the first four days = of=20 this month.=20 Maviglio attributed the lower cost to conservation the phasing in of cheap= er=20 long-term power contracts fewer power plants off-line for maintenance and= =20 cooler weather.=20 However he said The average cost is still way over what we paid last=20 year.=20 There was widespread skepticism in late April when the governor's consultan= ts=20 predicted that the $346 per megawatt-hour average paid by the state for=20 non-contracted power from April through June would drop to an average of $1= 95=20 from July through September.=20 We are still very comfortable with the projection that Mr. Fichera and=20 company estimated Maviglio said referring to Joseph Fichera of Saber=20 Partners in New York.=20 During a briefing on May 21 Fichera told reporters that the amount of powe= r=20 that the state would obtain under long-term contracts for May was expected = to=20 be about 43 percent of the total required the so-called net short.=20 Fichera said contracts already signed were expected to cover 66 percent of= =20 the net short in June 48 percent in July and 42 percent in August. He sai= d=20 contracts that had been agreed on in principle could increase those amounts= =20 to 73 percent in June 67 percent in July and 60 percent in August.=20 We are still on target. There are risks Fichera said yesterday among th= em=20 extended hot weather and power plant outages. No one is popping the=20 champagne corks until Sept. 30.=20 The governor's consultants based their forecast of power demand this summer= =20 on an estimate that Californians will reduce their electricity use by 7=20 percent.=20 The 11 percent reduction last month as compared to May of last year came= =20 before the sticker shock of rate hikes that begin this month for customers = of=20 Edison and Pacific Gas and Electric. And a $35 million ad campaign urging= =20 conservation has not hit full stride.=20 Maviglio said the administration plans to release some detailed information= =20 on Monday about the roughly $8 billion the state has spent buying power. Th= e=20 general fund will be repaid by a bond of up to $13.4 billion that ratepayer= s=20 will pay off over 15 years.=20 Legislative leaders have demanded detailed information about power purchase= s=20 before proceeding with the Edison plan. Assembly Democrats are working on a= =20 plan that de-emphasizes state purchase of the Edison transmission system an= d=20 would put most of the burden for paying off Edison's debt on businesses and= =20 large users not residences. Five tiers sought in proposed rate boost=20 Conservation would be promoted SDG&E says By Karen Kucher=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 A proposed rate increase for SDG&E customers to cover the high cost of=20 electricity should be imposed in five tiers to encourage conservation the= =20 company is advising state utility regulators.=20 The more electricity a customer uses the higher the rate would be.=20 SDG&E needs to raise its rates to bring in an additional $502 million=20 annually to pay the state for power purchases.=20 The state Public Utilities Commission is expected to rule on San Diego Gas = &=20 Electric's rate-increase proposal June 28.=20 The rate changes would remove a cap that has shielded most SDG&E customers= =20 from rising electricity prices for a year. The cap enacted by state=20 lawmakers in September 2000 and retroactive to June 2000 set rates at 6.5= =20 cents per kilowatt-hour.=20 Higher rates would mean the average SDG&E residential and small-business=20 customer's electricity bills would go up by 18 percent. Large commercial=20 users' bills would average 29 percent more.=20 Public hearings on the issue will be held next Monday and Tuesday in San=20 Diego El Cajon Escondido and San Clemente. These sessions will focus on= =20 small-business and residential consumers. Hearings on large commercial user= s=20 were held last month.=20 Earlier this year the PUC decided to allow the state's two largest=20 utilities Pacific Gas and Electric and Southern California Edison to char= ge=20 customers an extra $5.7 billion annually for electricity.=20 The state Department of Water Resources which has been buying power for=20 SDG&E customers since February asked SDG&E to generate a total of $915=20 million annually to cover the cost of electricity purchases.=20 With the proposed rate increases SDG&E could do that.=20 Large commercial customers would pay about 30 percent of the overall increa= se=20 and residential and small-business customers would pay about 70 percent sa= id=20 Ed Van Herik a spokesman for the utility company.=20 If the increase can be tiered as many as 60 percent of residential custome= rs=20 will see no rate increase if their electricity usage remains the same Van= =20 Herik said.=20 But customers who use more than 130 percent of their baseline -- considered= =20 the minimum amount of electricity needed by a household -- will be billed a= t=20 increasingly higher rates.=20 Residential and small-business customers who use a lot of electricity could= =20 pay as much as 17.89 cents per kilowatt hour for some power they consume.= =20 Consumer advocate Michael Shames said he is concerned the utility's proposa= l=20 does not spread the increases evenly among different types of users. He als= o=20 called for more scrutiny of the state's request.=20 People should tell PUC officials that this increase should not be a carte= =20 blanche or blank check approval said Shames the head of Utility Consumer= s'=20 Action Network. The PUC needs to ensure that the rate increase requested b= y=20 the (state) is reasonable.=20 The public hearings are scheduled for:=20 ?Monday 1 p.m. San Diego Concourse Copper Room 200 C St. San Diego.=20 ?Monday 7 p.m. El Cajon Community Center 195 E. Douglas Ave. El Cajon.= =20 ?Tuesday 1 p.m. Country Inn Hotel 35 Via Pico Plaza San Clemente.=20 ?Tuesday 7 p.m. Center for the Arts 340 N. Escondido Blvd. Escondido.= =20 Port budget large but power bills loom=20 Slowing economy also cause for worry By Ronald W. Powell=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 The rock is rolling financially but there are indications that the blues= =20 lurk on the horizon.=20 Officials of the San Diego Unified Port District -- headquartered in a=20 block-shaped building some employees call the rock -- are happy with a=20 projected 2001-2002 budget that is 5.1 percent larger than the current one.= =20 Total revenue is expected to reach $208.7 million $10.2 million above what= =20 is expected in the fiscal year that ends June 30.=20 Port commissioners gave preliminary approval to the budget yesterday and ar= e=20 scheduled to take a final vote July 10.=20 But a slowing economy and surging electric bills are causes for concern.=20 Electricity costs are expected to rise from $5 million to $8.2 million in t= he=20 coming fiscal year.=20 As far as trends we see a continuation of the growth we've experienced ov= er=20 the past five years said Bruce Hollingsworth the port's treasurer. But= =20 our percentage of growth will not rise as sharply.=20 Port revenues have grown steadily since the 1997-1998 fiscal year when $16= 3=20 million was generated.=20 The proposed budget calls for adding 24 employees to the port's 730-member= =20 work force. New hires will include three Harbor Police officers 10 employe= es=20 in the aviation division and four in maritime services.=20 The port operates Lindbergh Field and administers nonmilitary tidelands alo= ng=20 San Diego Bay. It is landlord to more than 600 waterfront businesses and=20 operates two marine cargo terminals and one cruise ship terminal.=20 The budget calls for growth in each of the port's primary revenue centers:= =20 aviation real estate and maritime services.=20 Passenger and cargo activity at Lindbergh Field is expected to generate $90= .7=20 million or $5 million more than expected in the current year. Most of that= =20 increase is expected to come from parking-rate increases at the airport and= =20 at the port's long-term parking lot on Pacific Highway.=20 Rent from hotels and other businesses that are port tenants are expected to= =20 total $63.1 million up $1.8 million from the current budget.=20 Increases in cargo and cruise ship traffic are expected to boost maritime= =20 income by $2.7 million to a total of $18.4 million.=20 The port expects to spend $157 million on construction projects. They inclu= de=20 $8.5 million to relocate the General Services Department from Eighth Avenue= =20 and Harbor Drive in San Diego to National City and more than $5 million for= =20 paving and improvements at the 10th Avenue Marine Terminal.=20 Rent revenue could grow substantially in future years. Four hotel projects = on=20 port property have won approval or are seeking it.=20 Jim Bailey president of Manchester Resorts told commissioners yesterday= =20 that he expects to break ground on a second Hyatt tower of 750 rooms by Jun= e=20 26. Port officials said revenue from that hotel would bring in an additiona= l=20 $3.7 million a year. It is scheduled to open in the summer of 2003.=20 Hollingsworth the treasurer said that if all four hotels are built the po= rt=20 could receive as much as $15 million a year in new revenue.=20 Continuous use urged for planned power plant=20 Escondido facility originally proposed for peak demand By Jonathan Heller=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 ESCONDIDO -- A proposed power plant in southwest Escondido that initially w= as=20 expected to run only during times of peak electricity demand probably will = be=20 allowed to run full time.=20 A state energy official who recommended approval of the plant yesterday has= =20 said the plant could operate as often as the state deems necessary.=20 The California Energy Commission was scheduled to vote on the project today= .=20 CalPeak Power of San Diego has asked the commission to approve a 49-megawat= t=20 plant on Enterprise Street near Vineyard Avenue. Referred to as a peaker= =20 plant such facilities typically are designed to supply energy only during= =20 times of peak demand.=20 The state limits the number of hours some plants can operate to keep=20 pollution at a minimum. A 44-megawatt peaker plant being built on West=20 Mission Avenue in Escondido by Ramco Inc. will be allowed to operate no mor= e=20 than 16 hours per day.=20 That plant is permitted to emit up to 5 parts per million of nitrogen oxide= =20 although its actual emissions are expected to be slightly lower said Dale= =20 Mesple a Ramco consultant. Nitrogen oxide is a component of smog.=20 The CalPeak plant if approved would be restricted to 2 parts per million = of=20 nitrogen oxide.=20 It was generally assumed that the CalPeak plant would operate under similar= =20 time restrictions as the Ramco plant. The potential for air pollution was= =20 among the chief concerns of residents who spoke at the City Council hearing= s=20 on the Ramco project and at the energy commission hearings about the CalPea= k=20 plant.=20 But under the terms of approval recommended by Energy Commission Chairman= =20 William Keese CalPeak's plant would be able to operate up to 8760 hours= =20 per year typically when the demand for electricity is high. That number= =20 equals 24 hours a day.=20 The actual number of hours would depend on the requirements of the state's= =20 Independent System Operator which manages the energy grid.=20 We certainly want to have the flexibility to run whenever we're needed= =20 said Mark Lyons CalPeak's development director. Exactly how often we will= =20 run is anybody's guess.=20 Escondido Councilwoman June Rady said she was frustrated by the possibility= =20 of the plant running full time. In Ramco's case the city and the county Ai= r=20 Pollution Control District made it clear how often the plant could operate.= =20 CalPeak chose to bypass the city's permitting process and went through the= =20 state Energy Commission which offers an expedited 21-day approval put in= =20 place by Gov. Gray Davis as an emergency measure.=20 I think Escondido has been absolutely ignored and there's a total lack of= =20 due process Rady said. It boils down to an issue of local control.=20 Although city officials objected to the commission pre-empting the city's= =20 land-use authority the commission maintained that Davis' order gave it the= =20 final say on this type of project.=20 If the commission gives final approval today the only remedy available to= =20 the city would be in court. At least three council members must vote to=20 initiate legal action.=20 Keese's recommended approval did take into account several city concerns=20 regarding landscaping. The CalPeak plant would be built near the entrance o= f=20 a planned high-tech business park and city officials were worried the=20 plant's appearance might hinder the ability to attract high-quality tenants= =20 to the park.=20 Mayor Lori Holt Pfeiler said she was not surprised by the commission's=20 recommendation.=20 I expected they would want to approve the project and that's why it was= =20 important for the city to weigh in with conditions we have in this=20 community Pfeiler said.=20 Rising energy prices threaten Poway troupe=20 By Brian E. Clark=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 POWAY -- Rising electricity rates may extinguish the stage lights this summ= er=20 for the Poway Performing Arts Company.=20 I'm afraid that if SDG&E gets the price increase it's asking for -- from 6= .5=20 cents per kilowatt-hour to 8.9 cents -- that we'll go under said Kathy=20 McCafferty spokeswoman for the nonprofit theater.=20 The volunteer organization produces its plays in a building at a Poway Road= =20 shopping center. It held three fund-raising performances over the weekend= =20 but officials were uncertain yesterday how much money was raised.=20 The group is not affiliated with the Poway Performing Arts Center and has= =20 been in business for 20 years.=20 McCafferty said the group built up a $2000 surplus last summer before ener= gy=20 prices began to surge.=20 That $2000 was a big reserve for us she said. It seemed like a ton of= =20 money but boy it went fast. And we're really energy-dependent. Our light= s=20 use a lot of power. And we're in Poway on the second floor of our building.= =20 It gets hot here and we have to use air conditioning.=20 But McCafferty acknowledged that the cost of power isn't the group's only= =20 problem.=20 In a recent letter to backers President Nan Katona said the organization= =20 also needs new blood to keep operating.=20 The truth is that lack of funding is just a symptom of the deeper problem= =20 which is lack of community support she wrote. Ironically audiences and= =20 reviewers recognize the Poway Performing Arts Company as one of the premier= =20 community arts theaters in San Diego.=20 Katona said some new volunteers had stepped forward to take leadership role= s=20 in the theater company since she wrote her letter last month. But she said= =20 rising electricity prices could still bring the group down.=20 If our energy bills double or triple we could be in dire straits she=20 said. It could push us over the edge financially.=20 McCafferty said it would be difficult for the theater to cut costs.=20 We can't run a much leaner operation she said. If our power prices go u= p=20 again we may still be forced out of business.=20 The theater is at 13250 Poway Road in the Lively Shopping Center. For more= =20 information call (858) 679-8085.=20 Fair to use generators for midway attractions=20 By Michael Burge=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 DEL MAR -- The Del Mar Fair will generate its own electricity for thrill=20 rides on the midway this year instead of using energy from SDG&E.=20 In case there are planned or unplanned outages we still will be operating= =20 fairgrounds General Manager Timothy J. Fennell said.=20 Fennell decided to put the midway on generators because he didn't want the= =20 fairgrounds pulling power from the grid while county residents are coping= =20 with rolling blackouts at home and at work he said.=20 And the fair does not want to take a chance that a rolling blackout will=20 leave some people stranded in rides high above the grounds forcing an=20 evacuation.=20 The fairgrounds has been told it is exempt from rolling blackouts but rath= er=20 than take such a risk it will rent 13 diesel-fuel generators and produce=20 electricity on the midway. The rest of the fairgrounds will use power from= =20 San Diego Gas & Electric Co.=20 Fairgrounds operations manager Larry Baumann estimated it would cost the=20 fairgrounds $20000 more to generate its own electricity than to buy it fro= m=20 SDG&E.=20 Midway manager Donna Ruhm said it will be worth it.=20 Rides that require evacuation have to have backup power and they do Ruhm= =20 said. Now our service won't be interrupted.=20 It is not unusual for carnivals to generate their own power and the=20 fairgrounds has done so in the past. Fair officials removed the generators = 10=20 to 15 years ago to reduce noise on the midway.=20 The fair opens June 15 and ends July 4.=20 While the rest of the fairgrounds is on the SDG&E grid Baumann said backup= =20 generators can kick in during a typical 60-or 90-minute blackout allowing= =20 the fair to operate without serious difficulty. Those generators are not=20 linked to the midway.=20 All the generators are licensed by the state and meet emission standards= =20 fair officials said so they do not expect the noise and odor to be=20 excessive.=20 The fairgrounds is taking the precaution of providing its own power despite= =20 the fact that it probably will not go dark during a rolling blackout.=20 SDG&E has assured me that .?.?. the fairgrounds and the racetrack will not= =20 be on the curtailment (blackout) list during the fair and the races said= =20 Del Mar Fire Chief Jack Gosney.=20 The Del Mar Thoroughbred racing season begins July 18 and ends Sept. 5.=20 Gosney said SDG&E told him earlier this year that the fairgrounds was not= =20 subject to a forced outage because it shared a circuit with the Del Mar Fir= e=20 Station which is a 911 dispatch center and exempt from a blackout. But he= =20 said recent research showed that the fairgrounds is on a separate circuit.= =20 Nonetheless Gosney said SDG&E is exempting the fairgrounds and racetrack= =20 during the busy summer season.=20 The fairgrounds paid $137152.95 for its electricity usage from March 12 to= =20 April 10. It paid $51845.39 for electricity during the same period last ye= ar. ?=20 Wednesday June 6 2001=20 'Hi My Name Isn't Justice Honey' and Shame on Lockyer=20 By TOM G. PALMER ?????Here's what California Atty. Gen. Bill Lockyer said at a press=20 conference about Enron Corp. Chairman Kenneth Lay: I would love to=20 personally escort Lay to an 8-by-10 cell that he could share with a tattooe= d=20 dude who says 'Hi my name is Spike honey.'=20 ?????Here's why Lockyer should be removed from his office of public trust:= =20 First because as the chief law enforcement officer of the largest state in= =20 the nation he not only has admitted that rape is a regular feature of the= =20 state's prison system but also that he considers rape a part of the=20 punishment he can inflict on others.=20 ?????Second because he has publicly stated that he would like to personall= y=20 arrange the rape of a Texas businessman who has not even been charged with= =20 any illegal behavior.=20 ?????Lockyer's remarks reveal him to be an authoritarian thug someone whol= ly=20 unsuited to holding an office of public trust.=20 ?????But his remarks do have one positive merit: They tell us what criminal= =20 penalties really entail.=20 ?????Contrary to some depictions of prisons as country clubs they are=20 violent and terrible places. More and more politicians propose criminal=20 sanctions for more and more alleged misdeeds and as a result ever more kin= ds=20 of behavior are sanctioned by criminal penalties perhaps now even selling= =20 electricity. Those found guilty of such crimes are put into cages where th= ey=20 are deprived of their liberty and dignity and as Lockyer so clearly=20 acknowledged raped and brutalized. What's worse Lockyer has indicated tha= t=20 he believes that rape is an appropriate part of the system of punishments h= e=20 administers.=20 ?????Should it matter that Lay is a businessman? Imagine the outcry if the= =20 head of Enron were female. What would Lockyer's fellow Democrats have said = to=20 that?=20 ?????Should it matter that Lay is chairman of an electricity generator? Doe= s=20 the nature of his business justify threats to escort him to his own rape?= =20 Lockyer told the Los Angeles Times that he had singled out Enron's chairman= =20 because the Houston-based company is the world's largest energy trader.=20 ?????So apparently singling out a man for a heinous threat is OK because he= 's=20 the chairman of the world's largest energy trading company. That's accordin= g=20 to the man who as a state senator sponsored California's 1984 hate-crimes= =20 law. Evidently the crusader against intimidation on the basis of race=20 religion and sexual orientation feels no hesitation at all about intimidati= ng=20 someone and threatening him with the brutal use of physical force simply=20 because he heads the world's largest energy trading company.=20 ?????Lockyer and Gov. Gray Davis seem to think that the best way to keep th= e=20 lights on is to threaten electricity producers with brute force rather tha= n=20 to offer to pay competitive rates in competitive markets. Are energy=20 producers to blame for California's energy problems? No. Bad policies=20 including rigid controls on retail prices of electricity are the cause of= =20 the problem not the people who generate energy. Scapegoating producers and= =20 threatening them with violence is an old ploy of authoritarians. California= ns=20 should not stand for it.=20 ?????An Enron spokesman said that Lockyer's chilling stated desire to arran= ge=20 the rape of Lay does not merit a response. The spokesman is wrong. Lockyer'= s=20 remarks merit public disgrace and removal from office. After all rape is n= ot=20 a form of legal justice in America--is it?=20 - - - Tom G. Palmer Is a Senior Fellow at the Cato Institute in Washington. E-mai= l:=20 Palmert@cato.org Copyright 2001 Los Angeles Times=20 California Metro Desk=20 U.S. Probes Alleged Pact Not to Build New Plants Power: Justice officials= =20 focus on Southland operations of two firms which deny wrongdoing. MYRON LEVIN NANCY RIVERA BROOKS ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 The U.S. Department of Justice has launched an investigation into whether t= wo=20 companies that control a large swath of Southern California 's electricity= =20 supply agreed to limit power plant construction potentially hindering=20 crucial energy production according to federal records and interviews.=20 The civil antitrust probe of Williams Energy Services and AES Southland=20 represents the Justice Department's first foray into the activities of ener= gy=20 suppliers who have reaped huge profits in California 's price-shocked marke= t.=20 AES disclosed the investigation which began last month in a filing with t= he=20 Securities and Exchange Commission on Tuesday. In its papers AES said the= =20 Justice Department is focusing on whether its agreement with Williams could= =20 constrain future power plant construction in Southern California .=20 The investigation comes at a time when the state is scrambling to get new= =20 generators built and running to avoid blackouts and economic problems.=20 The government alleges that AES and Williams agreed to limit the expansion = or=20 construction of new power plants near three facilities purchased by AES in= =20 1998 from Southern California Edison under the state's new deregulation pla= n.=20 The plants--in Long Beach Huntington Beach and Redondo Beach--are owned by= =20 AES but the electricity is sold by Williams. Under a 3-year-old deal know= n=20 as a tolling agreement Williams essentially rents out the capacity of the= =20 plants for annual payments to AES. Williams supplies natural gas to fire th= e=20 plants and sells the electricity under long-term contracts and in the costl= y=20 spot market.=20 Williams and AES have similar tolling agreements at plants in Pennsylvania= =20 and New Jersey. However AES spokesman Aaron Thomas said the Justice=20 Department's investigative requests have focused only on agreements between= =20 Williams and AES in Southern California .=20 Thomas would say only that the agreement at the center of the investigation= =20 is simply a delineation of how expansion or repowerings are done at the=20 facilities.=20 The three plants have a combined capacity of more than 3900 megawatts=20 enough to supply about 3 million homes. This summer AES is bringing anothe= r=20 450 megawatts on line by reactivating two mothballed generators in Huntingt= on=20 Beach.=20 Paula Hall-Collins a spokeswoman for Tulsa-based Williams Cos. said she= =20 believes that the investigation is unrelated to a recent inquiry by the=20 Federal Energy Regulatory Commission into whether AES and Williams=20 unnecessarily shut down plants to jack up prices. A portion of that=20 investigation was settled in April when Williams without admitting any=20 wrongdoing agreed to pay about $8 million.=20 We've always maintained that we've operated within the law and we're=20 certain the investigation by the DOJ will find we are operating legally= =20 Hall-Collins said.=20 Williams and AES are among the power plant owners and marketers that have= =20 been lambasted by Gov. Gray Davis because of gold-plated electricity prices= =20 that have pushed the state's biggest utilities to the edge of ruin and are= =20 steadily draining the state's budget surplus.=20 State officials are asking FERC to revoke the rights of AES and Williams to= =20 sell electricity at whatever price the market will bear. That right was=20 granted for three years beginning in 1998 by federal regulators when=20 California 's $28-billion electricity market was opened to competition.=20 Under that plan the rights of AES and Williams to sell into the market are= =20 the first to come up for renewal.=20 AES Southland and Williams Energy Services are both arms of large energy=20 companies--AES Corp. of Arlington Va. and Williams Cos. of Tulsa Okla. California Metro Desk=20 Natural Gas Power Prices Drop Sharply Energy: More conservation mild=20 weather are among factors keeping costs down experts say. RICARDO ALONSO-ZALDIVAR NANCY VOGEL ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 WASHINGTON -- The wholesale prices of electricity and natural gas in=20 California have fallen sharply in recent weeks and experts said Tuesday th= at=20 the relief could be the harbinger of an energy turnaround.=20 Or it may be just a blip.=20 In the last couple of weeks California power prices have plunged to the=20 lowest levels since April 2000 traders say with electricity selling on so= me=20 days for less than $100 per megawatt-hour.=20 At night when demand slackens power sometimes sells for less than $20 per= =20 megawatt-hour. That is reminiscent of the days before prices went haywire= =20 last summer.=20 It is a drastically different scenario than the $500 to $800 the state paid= =20 during a spate of hot weather last month.=20 Meanwhile wholesale natural gas prices at a bellwether pipeline junction o= n=20 the Southern California -Arizona border dipped last week to their lowest=20 levels since November according to a publication that tracks the industry.= =20 Separately Southern California Gas Co. and Pacific Gas & Electric Co.=20 reported June rate cuts for their residential gas customers of 16% and 38%= =20 respectively.=20 Experts credited a combination of conservation mild weather a burst of=20 increased hydroelectric generation and lower natural gas prices for the dro= p=20 in electricity costs.=20 Conservation is starting to worry the generators which is nice to see= =20 said Severin Borenstein director of the University of California Energy=20 Institute in Berkeley. Californians used 11% less energy last month than in= =20 May 2000 according to the state Energy Commission.=20 I'm worried that if we don't push harder on conservation [prices] won't= =20 stay down Borenstein added.=20 On the natural gas side experts said the price decline is due to replenish= ed=20 storage within California a nationwide drop in the cost of the fuel and= =20 easing demand from power plants.=20 The number of shippers competing to get natural gas to the state has also= =20 increased with the expiration of a controversial contract on the El Paso= =20 pipeline system last week.=20 But economists were reluctant to make sweeping predictions based on the=20 latest indicators.=20 It's hard to draw specific conclusions said Bruce Henning who tracks th= e=20 natural gas markets for Energy and Environmental Analysis Inc. an Arlingto= n=20 Va. consulting firm.=20 How the summer turns out depends on the weather in the state Henning said= =20 adding The weather represents the balance in the Southern California=20 market.=20 Natural gas fuels most California power plants. With wholesale prices=20 recently averaging three to four times the rates charged elsewhere in the= =20 country state and federal officials have despaired of chances for=20 controlling electricity costs.=20 Last Friday however the daily price for immediate delivery of natural gas= =20 in Topock Ariz. a pipeline junction near the California border dipped to= =20 $7.85 per million British thermal units.=20 According to Natural Gas Week it was the first time since mid-November tha= t=20 the price at that location had fallen below $8 per million BTUs. One millio= n=20 BTUs is what a typical Southern California home uses in five or six days.= =20 Considered a bellwether for other pipeline systems serving California the= =20 Topock price reached a record $56.54 per million BTUs on Dec. 8. It stood a= t=20 $9.36 per million BTUs at the close of business Tuesday still below recent= =20 weekly averages.=20 Other industry publications have also picked up signals of price declines.= =20 Platts the energy information division of McGraw-Hill Cos. reported Tuesd= ay=20 that the price for monthly gas delivery contracts to California fell 22% in= =20 June following a nationwide trend.=20 But Henning said the drop in California prices is attributable to both lowe= r=20 prices around the country and a decline in the high markups for shipping ga= s=20 to California . Those markups which far exceed the cost of transporting ga= s=20 have drawn the attention of state and federal investigators.=20 Henning said the markups are declining as depleted storage levels in=20 California are replenished. Storage levels have been filling very rapidly= =20 and that fact is reflected in prices coming down he said.=20 The link between natural gas and electricity prices is a hotly debated=20 subject. Some experts say high-priced natural gas is driving up the cost of= =20 electricity . Others believe that record prices for power are raising the= =20 prices that generators are willing to pay for their fuel.=20 Electricity prices that range from $20 to $200 per megawatt-hour--instead o= f=20 the $150 to $500 per megawatt-hour paid in recent months--are great news fo= r=20 Gov. Gray Davis.=20 Average daily power prices in California for transactions through the=20 Automated Power Exchange have dropped from $149 per megawatt-hour last Frid= ay=20 to $110 per megawatt-hour Tuesday. The exchange is a private company that= =20 brings together electricity buyers and sellers and accounts for less than 1= 0%=20 of the state's market.=20 Davis spokesman Steve Maviglio said Tuesday that average daily power=20 purchases by the state have recently dipped below $50 million.=20 The state has sometimes had to pay more than $100 million a day since it=20 started buying power in January through the Department of Water Resources.= =20 The state stepped in because California 's two biggest utilities became too= =20 financially crippled to withstand the prices being charged by generators.= =20 Davis' plan to pay for past and future energy purchases with a $12.4-billio= n=20 bond issue hinges on an assumption that power prices will be driven down th= is=20 summer through long-term contracts conservation and the construction of ne= w=20 power plants.=20 UC Berkeley's Borenstein said conservation efforts have not gone far enough= .=20 You walk into most buildings and you still need a sweater he said. That= =20 ain't the way to hit the target.=20 If Californians conserved an additional 10% off their peak usage on hot=20 afternoons he said we could really break the backs of the generators we= =20 could really collapse the price.=20 Prices tend to skyrocket in California 's electricity market on hot=20 afternoons when demand soars and grid operators must scramble to purchase= =20 enough electricity . Cool weather which reduces demand for air conditionin= g=20 and conservation help keep the state from reaching such crisis situations.= =20 Borenstein said he believes generators are also asking less money for their= =20 electricity in part because of a federal order that took effect last month.= =20 The order limits the price power plant owners can charge when California 's= =20 supplies are strained.=20 Power sellers say there are more fundamental forces at work.=20 There's more supply relative to demand which is softening prices said= =20 Gary Ackerman executive director of the Western Power Trading Forum. The= =20 market is working and it's providing cheaper wholesale power more quickly= =20 than any regulatory scheme could ever do.=20 *=20 Times staff writer Dan Morain in Sacramento contributed to this story.=20 RELATED STORY=20 PG&E wins: The utility averted a $1-billion bill for power buys. B6=20 (BEGIN TEXT OF INFOBOX / INFOGRAPHIC)=20 A Blip or a Trend?=20 Daily natural gas prices at the California border with Arizona--considered = a=20 bellwether of the state's costs--have been declining in the last two weeks.= =20 *=20 Natural gas price per 1 million Btu=20 $9.36=20 Source: Natural Gas Week California Metro Desk=20 The State Utility Averts $1 Billion in Costs Courts: PG&E and Cal-ISO agree= =20 to recognize Department of Water Resources as purchaser of the power. TIM REITERMAN ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-6=20 Copyright 2001 / The Times Mirror Company=20 SAN FRANCISCO -- Pacific Gas & Electric Co. and the state's power grid=20 operator reached an agreement Tuesday that insulated PG&E at least=20 temporarily from more than $1 billion in power purchases the state made for= =20 its customers.=20 The California Independent System Operator sent $1.26 billion in invoices t= o=20 the utility for power purchases by the state Department of Water Resources= =20 for PG&E customers from January through March.=20 But the utility contended in Bankruptcy Court proceedings that it was not= =20 liable for such purchases and that continued purchases would cause annual= =20 losses of $4 billion.=20 After arguments before Judge Dennis Montali PG&E and Cal-ISO agreed that t= he=20 Department of Water Resources not PG&E purchased the power. Cal-ISO had= =20 argued that it was making the purchases on PG&E's behalf.=20 PG&E wants to be a utility and have obligations to serve customers but th= ey=20 don't want to pay for it Cal-ISO general counsel Charles Robinson said=20 later.=20 If PG&E refuses to pay the invoices Robinson said Cal-ISO will send the= =20 bills to the Department of Water Resources and officials there can decide= =20 whether to pursue claims in Bankruptcy Court. A spokesman for department= =20 which has authorization to sell $13 billion in bonds for power purchases= =20 said the agency will have no comment until the matter can be studied.=20 State agencies have stayed out of the bankruptcy proceedings hoping to=20 preserve their immunity from suits in federal court.=20 The agreement will be submitted for Montali's approval Monday but the judg= e=20 said it would not be binding on the department because no one represented t= he=20 agency in court.=20 PG&E's own production and contracts provide the majority of the power for i= ts=20 customers. But state legislation adopted this year allows the department to= =20 secure power contracts to serve customers of ailing utilities. When a=20 shortage threatens the power grid the department purchases additional powe= r=20 through Cal-ISO on the spot electricity market.=20 PG&E filed for Chapter 11 protection from creditors on April 6 saying it w= as=20 $9 billion in debt.=20 Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited=20 David Lazarus Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 California electricity prices have plunged unexpectedly to their lowest lev= el=20 in more than a year partly as the result of a simultaneous drop in prices= =20 for natural gas which fuels most power plants.=20 Make no mistake: Gas and electricity prices could surge upward again in=20 months ahead.=20 But for the first time since California's energy markets went haywire last= =20 summer industry experts are beginning to ask whether the state finally may= =20 have turned a corner in its battle with runaway power costs.=20 California is not yet out of the woods said Kelley Doolan who tracks=20 natural gas prices for energy market researcher Platts. But this is a very= =20 significant decrease in costs.=20 Along with lower gas prices the decline in electricity costs was attribute= d=20 by state and industry officials to milder weather which reduces demand for= =20 power. They also credited recent conservation efforts by consumers and=20 better-than-expected runoff at dams for hydroelectric plants.=20 Gary Ackerman executive director of the Western Power Trading Forum an=20 energy-industry association said these factors came together to produce th= e=20 lowest wholesale electricity prices since April 2000.=20 Electricity on the spot market could have been purchased yesterday for as= =20 little as $50 per megawatt hour he noted compared with more than $500=20 earlier this year.=20 If the weather stays this way we could have reasonable prices all summer= =20 Ackerman said. We may also have fewer blackouts.=20 It is tempting for Californians to be suspicious of virtually any swing in= =20 energy prices. If power companies manipulated prices on the way up as=20 critics have alleged might they not be up to some trick as prices head in= =20 the opposite direction?=20 Nettie Hoge executive director of The Utility Reform Network in San=20 Francisco speculated that generators are allowing electricity prices to fa= ll=20 so they can discourage federal regulators from taking a more active role in= =20 the dysfunctional California market.=20 They're trying to take the heat off she said.=20 Others cautioned that the lower prices may be nothing more than a statistic= al=20 blip.=20 This was just one month's decline said Michael Shames executive directo= r=20 of the Utility Consumers' Action Network in San Diego. We really have to s= ee=20 how this plays out in the future.=20 Steve Maviglio a spokesman for Gov. Gray Davis said the governor was very= =20 encouraged by the lower energy prices. Davis announced Sunday that=20 California's power use was down 11 percent last month from a year before.= =20 We're not there yet Maviglio said of whether an end to the state's power= =20 woes is in sight. But the trend is pointing in the right direction.=20 WHITE ELEPHANT Yet this sudden drop in energy prices does have a dark side: California cou= ld=20 end up with a huge white elephant after spending about $40 billion in publi= c=20 funds on long-term power contracts.=20 The logic behind the contracts which are at an average price of $69 per=20 megawatt hour over 10 years is that the state expected to pay below-market= =20 rates for electricity for a number of years before prices came down and=20 California found itself paying above-market rates.=20 If current trends continue though California will find itself paying=20 consistently above-market rates much sooner than expected making the long-= =20 term contracts a sweet deal for the same power companies that profited so= =20 handsomely during the state's darkest hours.=20 The contracts look really ugly right now said Shames at the Utility=20 Consumers' Action Network. They may be way overpriced.=20 Maviglio the governor's spokesman said it is too early to conclude that t= he=20 state did poorly negotiating dozens of long-term power contracts.=20 No one has a crystal ball on this he said.=20 CUSTOMERS' BILLS TO DROP In any case Pacific Gas and Electric Co. said yesterday that customers'=20 average gas bills will drop 26 percent this month to $26 and should stay ne= ar=20 that level all summer.=20 Platts which monitors average monthly spot prices found that the wholesal= e=20 price of gas at the California-Oregon border has tumbled nearly 42 percent= =20 since the beginning of May -- from $9.98 per million British thermal units = to=20 $5.81.=20 The wholesale gas price at the California-Arizona border fell 45 percent= =20 from $11.91 to $6.50. This compares with a 25 percent monthly decline in=20 average natural gas prices nationwide.=20 However California gas prices are still about 50 percent higher than they= =20 were a year ago whereas national prices are now below year-ago levels for= =20 the first time since last spring.=20 While cooler weather nationwide helped push gas prices down overall Doolan= =20 attributed the especially steep drop in California to a commensurate surge = in=20 prices last month related to fears of a long hot summer of rolling=20 blackouts.=20 You had state officials all but promising rolling blackouts this summer = he=20 said. That created enormous demand for electricity generation.=20 What has changed is that we've had weeks of mild weather Doolan observed= .=20 The electricity generators have not come out of the woodwork buying up all= =20 the gas.=20 This allowed utilities like PG&E to beef up gas inventories which eased=20 demand and resulted in substantially lower prices he said.=20 'BACK ON TRACK'=20 We're back on track to be completely full for winter said Staci Homrig = a=20 PG&E spokeswoman. That's a very good thing.=20 Gas prices historically dip in the spring and summer and then rise again in= =20 the winter. PG&E is forecasting that customers' average gas bills could ris= e=20 to as high as $75 in December if current trends continue.=20 However the precipitous drop in gas prices in recent weeks suggests that= =20 California's unusually high costs at last may be abating.=20 Individual power companies so far are reluctant to speculate on whether the= =20 drop in gas prices will have a lasting effect on electricity costs.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 San Jose council gives green light to generating plant=20 VOTE REVERSAL: Officials pressured to OK project=20 Marshall Wilson Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 In a clear sign that the political landscape has shifted because of the=20 state's power crisis the San Jose City Council gave a green light yesterda= y=20 for construction of a generating plant it had unanimously opposed in=20 November.=20 Yesterday's 10-to-1 vote came after months of mounting pressure for the cit= y=20 to reverse course and approve the controversial 600-megawatt Calpine plant = at=20 Coyote Valley.=20 That pressure -- increased by the occasional rolling blackout -- has come= =20 from nearly every corner of the state from elected officials to high-tech= =20 businesses and labor unions worried the power crisis will drain away jobs= =20 ruin the economy and lead to voter backlash over skyrocketing energy bills.= =20 Even the local branch of the NAACP and environmentalists pushed the council= =20 to approve the Calpine proposal -- despite overwhelming opposition from the= =20 plant's neighbors.=20 Council members did not hide their disdain yesterday for being forced to=20 reconsider their opposition to the so-called Metcalf Energy Center.=20 I'm holding my nose to vote for this thing said Councilwoman Linda=20 LeZotte.=20 I'm just as unhappy as everybody else Vice Mayor George Shirakawa said. = I=20 feel like no matter what happens we can't win.=20 GOVERNOR OFFERED HIS SUPPORT After the council's solid opposition in November Calpine appealed to the= =20 California Energy Commission which has the final say. The controversial=20 plant then received a huge boost in April when Gov. Gray Davis threw his=20 support behind it.=20 San Jose officials conceded yesterday that the energy commission was likely= =20 to override their opposition and grant approval within a few weeks. They sa= id=20 the commission's likely approval was stripping them of their power to decid= e=20 local land-use issues.=20 What I think has happened . . . is the governor and the Legislature at the= =20 state level have taken this out of our hands said Councilwoman Pat Dando.= =20 I don't think there's any chance at all the California Energy Commission i= s=20 going to turn down the Metcalf Energy Center Councilman Chuck Reed said.= =20 CONSTRUCTION MAY BEGIN SOON If given the go-ahead by the state Calpine could begin construction as ear= ly=20 as next month. The natural-gas fired plant would generate electricity by=20 mid-2003 company spokesman Kenneth Arbeu said.=20 At the urging of Mayor Ron Gonzales the council yesterday approved a new= =20 cooperation agreement with Calpine. The vote with Councilman Forrest=20 Williams casting the lone nay is preliminary while a final vote that is=20 scheduled for June 26.=20 Gonzales argued that the agreement did not amount to a flip-flop because it= =20 differs from what Calpine proposed in November.=20 The agreement approved by the council calls for increased monitoring of air= =20 pollution the use of treated wastewater to cool the plant which will redu= ce=20 discharges into San Francisco Bay and a $6.5 million community benefits= =20 package with the bulk going toward parkland acquisition Gonzales said.=20 This council has not changed its decision he said. What we've done is= =20 change the facility.=20 Critics incensed that the city was buckling to outside pressure vowed to= =20 change the council at the next election.=20 CONCERNS OVER HEALTH RISKS They raised concerns that boiled wastewater steam wafting over their homes= =20 from Calpine's plant could pose health risks. Jona Denz-Hamilton said more= =20 controls are needed to ensure the safety of neighbors like herself and her= =20 family and argued that new cleaner-burning technologies should be installe= d=20 at the plant.=20 It's too great of a risk she said.=20 Other critics said the state's energy woes will be solved and largely=20 forgotten by the time the plant opens in two years while the Santa Teresa= =20 neighborhood will be stuck with pollution for decades.=20 Approval seemed a given at the start of the more than three-hour hearing.= =20 Much of the afternoon's debate focused around plans to extend a pipeline fo= r=20 treated wastewater to the new plant.=20 Critics said Calpine was receiving a sweet deal by paying only $10 million = of=20 the $50 million cost of extending the pipeline. Several council members ask= ed=20 for a more detailed report into the financing plan before the final vote is= =20 taken June 26.=20 Chronicle staff writer Bill Workman contributed to this report.=20 E-mail Marshall Wilson at 2001 San Francisco Chronicle ? Page?A - 1=20 Developments in California's energy crisis=20 Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate1 053EDT0177.DTL=20 (06-06) 07:53 PDT (AP) --=20 Developments in California's energy crisis:=20 WEDNESDAY: * No power alerts Wednesday as reserves stay above 7 percent.=20 TUESDAY: * Gov. Gray Davis' administration says the state's electricity costs are=20 dropping substantially even as it asks state legislators for another=20 half-billion dollars for power purchases. That brings to $8.2 billion the= =20 amount the state is paying for electricity on behalf of three financially= =20 strapped utilities.=20 Spokesman Steve Maviglio says the cost to the state treasury has dropped in= =20 the last few weeks well below the $50 million dollars the state had been=20 paying on a typical day. He credits cooler weather conservation more powe= r=20 plants online and more long-term contracts with helping drive down the cost= .=20 * A state Senate committee agrees to issue subpoenas to eight out-of-state= =20 electricity generators demanding they hand over documents on bidding prici= ng=20 and other aspects of power sales in the state. The subpoenas would help a= =20 special Senate committee's investigation into whether the companies are=20 illegally profiteering from California's power crisis. The committee's=20 chairman says he expects the companies to resist setting the stage for a= =20 court battle.=20 * Oil giant Chevron threatens to cut gasoline production in California unle= ss=20 it is exempted from rolling blackouts. The San Francisco Chronicle says it= =20 has a copy of a letter sent Friday from Chevron chairman David O'Reilly to= =20 Davis. In the letter O'Reilly says the company will scale back gasoline=20 production at its Richmond and El Segundo plants operating those refinerie= s=20 only with power produced by generators at the sites.=20 * New U.S. Senate Majority Leader Tom Daschle D-S.D. supports Federal=20 Energy Regulatory Commission price caps. FERC must meet its obligation und= er=20 current law to ensure 'just and reasonable' prices for wholesale electricit= y=20 in the state of California. FERC has failed to meet this responsibility...= =20 Daschle says in a letter to Davis. Unless FERC acts soon Senator (Dianne)= =20 Feinstein's legislation should be taken up and passed to direct FERC to tak= e=20 action. I will support all necessary efforts to meet that goal.=20 * House Subcommittee on Energy Policy Natural Resources and Regulatory=20 Affairs Chairman Doug Ose R-Sacramento cites Electric Utility Week figure= s=20 that FERC's limited price caps helped cut California's power rates from $30= 0=20 to $108.47 per megawatt hour within an hour after taking effect last week.= =20 While he says more information is needed Ose uses the figures to tout his= =20 pending bill to impose the price caps around the clock and to all Western= =20 states.=20 * Pacific Gas & Electric Co. asks U.S. Bankruptcy Judge Dennis Montali to= =20 stop the manager of the state's power grid from buying electricity for=20 utility or charging it for any electricity bought after the utility filed f= or=20 bankruptcy on April 6. Separately the utility's creditors support its=20 request to the bankruptcy court to pay out $17.5 million in bonuses to the= =20 management team that guided the utility into bankruptcy.=20 * California Department of Water Resources reveals it is negotiating with= =20 municipal utilities to buy their surplus power. Department spokesman Oscar= =20 Hidalgo says talks began last week but no agreements are imminent.=20 * State lawmakers criticize a $3 million lobbying campaign by Southern=20 California Edison. The utility is telephoning shareholders to describe the= =20 dire consequences if the utility goes bankrupt. The call is then transferre= d=20 to the state Capitol so shareholders can implore lawmakers to support a=20 controversial plan to help the utility. Legislators and their staffers say= =20 the shareholders often are confused and scared their investments will be=20 degraded or wiped out.=20 * State Treasurer Phil Angelides joins an advocacy group for the poor in=20 urging the state's huge pension funds to use their economic power to levera= ge=20 power companies. The Pacific Institute for Community Organization says the= =20 two pension funds own at least $1.2 billion in stocks and bonds in most of= =20 the firms that sell electricity to California.=20 * The Assembly by a 69-0 vote approves a bill to spend $10 million on=20 environmental studies needed before Path 15 the inadequate transmission-li= ne=20 group between Northern and Southern California can be expanded. The bill= =20 moves to the Senate.=20 * Pacific Gas and Electric announces a decrease in natural gas prices down= =20 38 percent from May's rates and 66 percent lower than January's rates. The= =20 decline will bring the average residential gas bill to $26 when it goes int= o=20 effect June 7. Market analysts predict the rates will remain stable until= =20 December when demand is expected to increase with winter heating loads.=20 * No power alerts Tuesday as electricity reserves stay above 7 percent.=20 * Shares of Edison International closed at $10.05 down 53 cents. PG&E Corp= .=20 closed at $11.25 down 15 cents. Sempra Energy the parent company of San= =20 Diego Gas & Electric closes at $26.91 down 43 cents.=20 WHAT'S NEXT: * Davis' representatives continue negotiating with Sempra the parent compa= ny=20 of San Diego Gas and Electric Co. to buy the utility's transmission lines.= =20 THE PROBLEM: High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Edison and PG&E say they've lost nearly $14 billion since June to high=20 wholesale prices the state's electricity deregulation law bars them from=20 passing on to consumers. PG&E saying it hasn't received the help it needs= =20 from regulators or state lawmakers filed for federal bankruptcy protection= =20 April 6.=20 Electricity and natural gas suppliers scared off by the two companies' poo= r=20 credit ratings are refusing to sell to them leading the state in January = to=20 start buying power for the utilities' nearly 9 million residential and=20 business customers. The state is also buying power for a third investor-own= ed=20 utility San Diego Gas & Electric which is in better financial shape than= =20 much larger Edison and PG&E but also struggling with high wholesale power= =20 costs.=20 The Public Utilities Commission has approved average rate increases of 37= =20 percent for the heaviest residential customers and 38 percent for commercia= l=20 customers and hikes of up to 49 percent for industrial customers and 15=20 percent or 20 percent for agricultural customers to help finance the state'= s=20 multibillion-dollar power buys.=20 2001 Associated Press ?=20 California conserves=20 Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/E D86597.DTL=20 WHEN RAIN fails to fall from the sky Californians know why there is a=20 drought. But when rolling blackouts suddenly appeared in the dead of winter= =20 many of us wondered who was responsible for and who has profited from what= =20 now seems like an artificially created power shortage in the state.=20 Our skepticism proved to be right. Windfall profits were reaped by=20 electricity generators while natural gas importers extracted prices far abo= ve=20 the national average.=20 Timid federal overseers exact only wrist-slap penalties on the offending=20 energy firms. The White House scoffs at temporary controls for a=20 malfunctioning market. California's state government has ended up as the bi= ll=20 payer for the sickly utilities forking over $8 billion to generators. This= =20 number may hit $40 billion by year-end.=20 It's an infuriating tangle. All the more remarkable then that skeptical= =20 Californians have managed within two months to reduce their use of=20 electricity by 11 percent. The public's response to the governor's appeal f= or=20 energy conservation has exceeded expectations. Although many businesses hav= e=20 suffered enormous losses ordinary people have made relatively painless=20 sacrifices. People turned off their lights purchased energy-efficient=20 lightbulbs used air conditioning less and shut off their computers when no= t=20 in use.=20 Despite this remarkable civic compliance we still face an unconscionable= =20 lack of leadership. President Bush seems perfectly willing to allow Texas= =20 power companies to pummel the once-powerful California economy. He repeats = a=20 mantra about creating more supply -- which California is doing with 15 powe= r=20 plants under construction -- while ignoring the outsized sums paid to a=20 handful of energy generators.=20 At the same time Gov. Gray Davis who has given new meaning to the word=20 dithering has failed to make the tough and transparent decisions. He delay= ed=20 an inevitable rise in power rates. Davis also dragged his feet in openly=20 announcing new power contracts that commit California to billions in spendi= ng=20 over the next decade.=20 To Davis' credit he has urged California to conserve by laying out an $800= =20 million plan to cut power use and invest in energy-saving programs. The=20 message is getting out as higher rates take effect this month.=20 Despite a woefully unbalanced market and shortsighted leadership the peopl= e=20 of California have demonstrated that if there is a will there is a way.=20 Now it is time for our leaders to follow the wisdom of their constituents.= =20 2001 San Francisco Chronicle ? Page?A - 20=20 L.A. power customers awash in cheap energy=20 John Wildermuth Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/M N133438.DTL=20 Los Angeles -- These are flush times for the city's Department of Water and= =20 Power and the energy executives are loving every minute of it.=20 As are their customers.=20 Private power companies throughout California have been raising rates and= =20 warning customers about a long hot summer filled with blackouts but the= =20 city- owned DWP has been keeping prices stable and the lights on for 1.2=20 million Los Angeles customers.=20 Our customers are being really nice to us said Angelina Galiteva the=20 utility's strategic planning director. They love the DWP.=20 Although Gov. Gray Davis' administration announced that the state had reduc= ed=20 its energy consumption 11 percent from a year ago those in Los Angeles had= =20 cut back less than half that -- and polls show they view the energy situati= on=20 less seriously than other Californians.=20 Public utilities such as Los Angeles water and power have seen their revenu= es=20 increase during the energy crunch because they can sell their excess power = at=20 higher prices than ever before in a market tilted toward sellers.=20 The rest of the state doesn't always feel that same warm glow. Davis has=20 accused the DWP and other California public utilities of putting exorbitant= =20 price tags on the excess electricity they sell to the rest of the energy-= =20 starved state.=20 It's a charge Los Angeles utility executives deny arguing that their exces= s=20 power is sold at cost plus 15 percent which they say is a fair return for= =20 their customers.=20 Without our support a million more homes (elsewhere in California) would= =20 have suffered rolling blackouts which is a powerful message Galiteva sai= d.=20 It wasn't supposed to be this way. When the power industry was deregulated = in=20 the late '90s energy giants like Pacific Gas and Electric Co. and Southern= =20 California Edison were expected to be the big winners. Now PG&E is in=20 bankruptcy and Edison is a short step away.=20 When deregulation came the experts said that the investor-owned utilities= =20 would become lean mean machines that would be better able to operate in th= e=20 new environment Galiteva said. But now public power has shown it can ser= ve=20 customers more efficiently at lower rates.=20 While much of the state worries about electrical supply Los Angeles=20 residents have been saved many of those concerns.=20 In a survey done last month by the Public Policy Institute of California 4= 8=20 percent of the people in the Bay Area thought that electricity cost and=20 availability were the most important issues facing the state. In Los Angele= s=20 however only 33 percent put the energy crunch on top. When questioned abou= t=20 the size of the power problem and the effect it would have on the state's= =20 economy Los Angeles residents were consistently less concerned than people= =20 elsewhere in California.=20 People in Los Angeles have been somewhat isolated from the energy crisis= =20 concluded Mark Baldassare who conducted the survey.=20 That doesn't mean the state's energy problems haven't had an effect. The DW= P=20 has seen a 3 percent to 5 percent reduction in some uses which officials= =20 have dubbed sympathy conservation. The utility also is offering its bigge= st=20 customers financial incentives to cut back on their power use.=20 Our average annual load growth is about 80 megawatts Galiteva said. By= =20 this summer we expect to have saved 40 megawatts through conservation. By= =20 December we expect 60 megawatts in savings.=20 The utility also is making a major attempt to create a conservation ethic= =20 among its customers. DWP's comfortable situation has made it possible to=20 offer them the carrot without the need to show them the stick.=20 Conservation no longer means doing without Galiteva said. Beer can be= =20 just as cold with a superefficient refrigerator. Rooms can be just as brigh= t=20 with superefficient light bulbs.=20 A Green Power program also is promoting the use of renewable energy=20 resources such as solar wind and hydroelectric power. About 75000 custome= rs=20 are paying an extra $3 per month to increase DWP's use of renewable power= =20 sources.=20 We're trying to give our customers a choice and a voice in determining the= =20 mix of power they use Galiteva said. They know they can do (conservation= )=20 now or see it being mandated later.=20 Los Angeles power officials -- and their customers -- know the DWP isn't=20 always going to continue as an island of tranquility in a sea of energy=20 turmoil. The utility's aging gas-fired plants have been affected by the=20 rising price of natural gas. Demand for energy continues to rise. In a deba= te=20 last month both candidates for mayor of Los Angeles agreed that increases = in=20 local power bills are inevitable.=20 But the DWP has been supplying power to Los Angeles since 1916 and its=20 executives believe that the state's deregulation disaster has shown the=20 advantages of the city-owned utility.=20 It's nice to be the lean mean green efficient machine that no one ever= =20 expected us to become Galiteva said.=20 E-mail John Wildermuth at 2001 San Francisco Chronicle ? Page?A - 13=20 PG&E doesn't want to pay for energy to avert blackouts=20 DAVID KRAVETS Associated Press Writer Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate0 306EDT0102.DTL=20 (06-06) 00:06 PDT SAN FRANCISCO (AP) --=20 Pacific Gas & Electric Co. has told a bankruptcy judge it should not have t= o=20 pay for what could amount to billions of dollars in spot-market energy cost= s=20 to avert blackouts.=20 The company's position was one of two developments that emerged Tuesday as= =20 the bankrupt utility tries to cope with fallout from California's power=20 crisis. The other development saw a group of creditors that PG&E owes=20 billions endorse $17.5 million in bonuses for top managers at the utility.= =20 San Francisco-based PG&E filed for bankruptcy protection in April after=20 racking up an $8.9 billion debt which under state law it could not recoup= =20 from customers.=20 Tuesday's court dispute centered on who pays for energy bought at the last= =20 minute to avoid blackouts.=20 PG&E said an April federal regulatory decision requires that electricity ca= n=20 only be sold to those with the ability to pay electricity generators. The= =20 state is the only player with such ability said PG&E attorney Jerome Faulk= =20 who argued that the utility shouldn't have to pay the $330 million in month= ly=20 spot-market energy bills.=20 Judge Dennis Montali said he may craft such an order. But he said the order= =20 would not preclude the state from suing PG&E to recover the cost.=20 In a separate but related development a committee charged with devising a= =20 payment plan for those creditors owed billions by PG&E said it will sign of= f=20 on the utility's plan to pay $17.5 million in bonuses to PG&E's management= =20 team.=20 Attorney Allan Marks who represents the committee said such payments are= =20 normal during large bankruptcy cases. Under the agreement which Montali wi= ll=20 consider at a June 18 hearing the company must quickly produce a debt=20 payment plan that passes judicial muster.=20 The utility said it needs the bonuses for a management retention program.= =20 Marks agreed. While the $17.5 million leaves less for creditors without a= =20 financial incentive PG&E's key top brass may not be willing to cooperate wi= th=20 a payment plan Marks said.=20 The main goal for the creditors' support here is to move the bankruptcy as= =20 quickly and smoothly as possible Marks said.=20 The Utility Reform Network a consumer watchdog group says PG&E is simply= =20 rewarding managers of a failed business effort.=20 They're just showering money on the same people who got them in this mess= =20 said TURN's Mike Florio.=20 The proposed bonuses would come on top of $50 million in bonuses and raises= =20 PG&E awarded just before the April 6 bankruptcy filing.=20 The case is In Re Pacific Gas & Electric Co. 01-30923 DM.=20 2001 Associated Press ?=20 Metcalf plant gets preliminary approval=20 Posted at 12:21 a.m. PDT Wednesday June 6 2001=20 BY MIKE ZAPLER=20 Mercury News=20 As the San Jose City Council approached its 10-1 vote Tuesday to give an=20 initial nod to Calpine's big power plant in South San Jose Councilwoman=20 Linda LeZotte perhaps captured the body's mood best.=20 ``I'm holding my nose to vote for this thing'' she said. ``Without faultin= g=20 the mayor or his staff quite frankly I think this deal stinks.''=20 Caught in what some members called a bind beyond their control the council= =20 gave preliminary approval to an agreement negotiated by Mayor Ron Gonzales= =20 and Calpine on the company's proposed 600-megawatt Metcalf Energy Center.= =20 Councilman Forrest Williams who represents the Santa Teresa neighborhood= =20 near the site cast the lone vote against the deal.=20 The agreement is scheduled to come back before the council for a final vote= =20 on June 26 but Tuesday's vote effectively shifts the battle to the courts= =20 where residents are expected to lodge a lawsuit in one final attempt to blo= ck=20 the plant.=20 Still Councilwoman Pat Dando and some of her colleagues raised questions= =20 about the deal they said they want answered before the final vote. Their=20 issues could be incorporated into the final deal.=20 Many of the concerns focused on a $50 million recycled water pipeline=20 Gonzales agreed to have the city build to accommodate the project $10=20 million of which would be reimbursed by Calpine over 30 years.=20 Pipeline possibility=20 Dando said that a private company Great Oaks Water may be willing to buil= d=20 the pipeline extension itself saving the city the $50 million expense.=20 Officials at Great Oaks were unavailable Tuesday.=20 Council members peppered staff with other questions. Many were alarmed by= =20 claims of the Silicon Valley Toxics Coalition which said that using treate= d=20 sewage water to cool the power plant could allow dangerous chemicals to see= p=20 into drinking water aquifers. An environmental services director said the= =20 recycled water meets federal specifications but that there is no protocol= =20 for testing other chemicals not included in those standards.=20 Councilman Ken Yeager asked why Calpine should be allowed to spread a $3.9= =20 million water connection fee over 10 years -- an arrangement that would=20 mandate an amendment to city law.=20 LeZotte meanwhile said she wants to hold Calpine accountable to install= =20 ammonia-free technology at the plant. Ammonia is highly hazardous and=20 residents say the use of the chemical to clean the plant is among their chi= ef=20 concerns.=20 The agreement requires the company to install technology to reduce or=20 eliminate the use ammonia when it becomes ``technologically and economicall= y=20 feasible.'' LeZotte said she wants a clear definition of ``feasible''=20 included in the deal.=20 Tuesday's vote marked a stark departure from the council's November vote to= =20 deny Metcalf. At the time council members said a power plant was=20 inappropriate for the area and many members said Tuesday that they still= =20 believe that.=20 Bowing to pressure=20 But with Gov. Gray Davis endorsing Metcalf in April and the California Ener= gy=20 Commission widely expected to override the city's denial this month counci= l=20 members said they had no choice but to cut the best deal it could and allow= =20 the project to proceed.=20 That explanation however didn't sit well with residents of the Santa Tere= sa=20 neighborhood adjacent to the Metcalf site one of whom accused Gonzales and= =20 the council of ``switching sides when the opposing team gets too close to t= he=20 goal line.''=20 Contact Mike Zapler at mzapler@sjmercury.com or at (408) 275-0140.=20 Feds probe AES Williams=20 Antitrust investigation looks into allegations of manipulated energy prices= =20 through reduced power-plant construction.=20 June 6 2001=20 By JAMES ROWLEY Bloomberg News=20 WASHINGTON - The U.S. Justice Department opened an antitrust investigation= =20 into California's electricity shortage by probing allegations that AES Corp= .=20 and Williams Energy Services Co. are limiting power-plant expansion to driv= e=20 up prices.=20 AES Corp. the biggest U.S. power-plant developer disclosed the=20 investigation in a filing with the U.S. Securities and Exchange Commission.= =20 The Justice Department is looking into a supply-and-marketing agreement=20 between AES' California power-plant unit and a Williams unit that supplies= =20 natural gas.=20 Williams owner of the second-largest U.S. natural-gas pipeline system als= o=20 markets the power produced by AES' three electricity plants in the state.= =20 The department alleges the agreement limits expansion of generating capacit= y=20 near some AES plants.=20 AES said it was cooperating with the Justice Department investigation whic= h=20 began last month into possible violations of Section 1 of the Sherman=20 Antitrust Act.=20 That provision outlaws any restraint of trade that stifles competition.=20 A shortage of generating capacity in California has led to soaring wholesal= e=20 prices and rolling blackouts and prompted Pacific Gas & Electric the state= 's=20 largest utility to seek bankruptcy protection in April.=20 Aaron Thomas a spokesman for AES based in Arlington Va. said the U.S.= =20 investigation started no more than a couple of weeks ago.=20 Williams spokeswoman Paula Hall-Collins said the Tulsa Okla.-based company= =20 is cooperating.=20 Gina Talamona Justice Department spokeswoman said the agency had no=20 immediate comment.=20 The investigation was opened several weeks after the Federal Energy=20 Regulatory Commission investigated AES plants in Long Beach and Huntington= =20 Beach designated must run under the Federal Power Act did not produce= =20 electricity for 10 days in April and May 2000. Williams agreed to pay the= =20 operator of California's electric grid $8 million to settle allegations tha= t=20 it overcharged for power.=20 FERC charged in March that the companies had a financial incentive to keep= =20 the units out of service to force the California Independent System Operato= r=20 to buy power from AES' plant in Redondo Beach at prices close to the=20 FERC-imposed cap of $750 per megawatt-hour.=20 AES said it was complying with a Justice Department demand for documents=20 about the agreement between its AES Southland LLC unit and Williams Energy= =20 Services Co. AES Southland which operates the three power plants was also= =20 asked to respond to interrogatories the company said.=20 The Williams unit supplies the natural gas to fuel the AES plants and marke= ts=20 the power they produce.=20 AES and Williams jointly produce and sell about 4000 megawatts in Californ= ia=20 -- 6 to 8 percent of the state's power -- enough electricity to light about= 3=20 million typical California homes.=20 AES shares dropped $2.05 to $42.54. Williams Cos. shares dropped $1 to=20 $38.20. Calpine Begins Construction of Peaking Energy Center in Gilroy Calif.=20 June 6 2001=20 SAN JOSE Calif. June 5 /PRNewswire/ via NewsEdge Corporation -=20 Calpine Corporation (NYSE: CPN) the San Jose Calif.-based independent pow= er=20 company today announced that initial construction of 135 megawatts (mw) of= =20 peaking generation capacity will begin during this week adjacent to its=20 existing Gilroy Power Plant in Gilroy Calif. Through an Application for=20 Certification (AFC) filed with the California Energy Commission (CEC) on=20 April 25 2001 Calpine proposed to add three 45-mw simple-cycle gas turbin= e=20 peaking units in the first of a two-phase process. The California Energy=20 Commission approved the project on May 21 2001.=20 Because the required natural gas water and transmission infrastructure=20 exists at our Gilroy plant it is an ideal site for the addition of peaking= =20 generation allowing for rapid installation of needed capacity. The first= =20 three units are expected to begin generating electricity this September= =20 commented Bryan Bertacchi Calpine Vice President - Western Region.=20 Upon completion the two-phase build out the Gilroy Energy Center will be a= =20 270-mw natural gas-fired simple-cycle peaking generation facility located= =20 on approximately 9.5 acres at 1400 Pacheco Pass Highway in Gilroy. Commerci= al=20 operation of Phase One is scheduled for September 2001. An additional three= =20 45-mw gas turbine generators will be installed in Phase Two with full=20 build-out estimated for May 2002. Phase Two requires the filing of an=20 additional application with the CEC and is subject to a four-month review= =20 process.=20 Initial construction will begin this week with site and civil engineering= =20 activities occurring for approximately six weeks at which time the site wil= l=20 be cleared and leveled. Foundation work and the installation of generation= =20 equipment will follow shortly thereafter and commissioning and testing wil= l=20 take place for a two to three week period prior to commercial operation in= =20 September 2001.=20 The Gilroy Energy Center web site has been created to host all information= =20 and updates related to this project. For additional information please vis= it=20 www.gilroypower.com.=20 Calpine Corporation based in San Jose Calif. is dedicated to providing= =20 customers with reliable and competitively priced electricity. Calpine is=20 focused on clean efficient natural gas-fired generation and is the world'= s=20 largest producer of renewable geothermal energy. Calpine has launched the= =20 largest power development program in North America. To date the company ha= s=20 approximately 32200 megawatts of base load capacity and 7200 megawatts of= =20 peaking capacity in operation under construction pending acquisitions and= =20 in announced development in 29 states and Canada. The company was founded i= n=20 1984 and is publicly traded on the New York Stock Exchange under the symbol= =20 CPN. For more information about Calpine visit its Website at=20 www.calpine.com.=20 This news release discusses certain matters that may be considered=20 forward-looking statements within the meaning of Section 27A of the=20 Securities Act of 1933 as amended and Section 21E of the Securities=20 Exchange Act of 1934 as amended including statements regarding the intent= =20 belief or current expectations of Calpine Corporation (the Company) and i= ts=20 management. Prospective investors are cautioned that any such forward-looki= ng=20 statements are not guarantees of future performance and involve a number of= =20 risks and uncertainties that could materially affect actual results such as= =20 but not limited to (i) changes in government regulations including pendin= g=20 changes in California and anticipated deregulation of the electric energy= =20 industry (ii) commercial operations of new plants that may be delayed or= =20 prevented because of various development and construction risks such as a= =20 failure to obtain financing and the necessary permits to operate or the=20 failure of third-party contractors to perform their contractual obligations= =20 (iii) cost estimates are preliminary and actual cost may be higher than=20 estimated (iv) the assurance that the Company will develop additional=20 plants (v) a competitor's development of a lower-cost generating gas-fired= =20 power plant and (vi) the risks associated with marketing and selling power= =20 from power plants in the newly competitive energy market. Prospective=20 investors are also cautioned that the California energy environment remains= =20 uncertain. The Company's management is working closely with a number of=20 parties to resolve the current uncertainty while protecting the Company's= =20 interests. Management believes that a final resolution will not have a=20 material adverse impact on the Company. Prospective investors are also=20 referred to the other risks identified from time to time in the Company's= =20 reports and registration statements filed with the Securities and Exchange= =20 Commission.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Calpine Corporation=20 CONTACT: media Lisa Poelle ext. 1285 or investors Rick Barraza ext.=20 1125 both of Calpine Corporation 408-995-5115=20 Web site: http://www.gilroypower.com=20 Web site: http://www.calpine.com (CPN)=20 Reliant Urges FERC to Drop or Amend California Price Caps to Avoid Addition= al=20 Shortages and More Blackouts=20 June 6 2001=20 HOUSTON June 5 /PRNewswire/ via NewsEdge Corporation -=20 Reliant Energy (NYSE: REI) filed an emergency motion with the Federal Energ= y=20 Regulatory Commission (FERC) on Monday urging the agency to drop the=20 California price caps first applied May 29 or at a minimum amend them to= =20 reflect the true costs they are attempting to control. The current price=20 caps which send inaccurate market signals are actually decreasing supply= =20 and increasing demand thus worsening an already dire situation.=20 FERC has been publicly dedicated to an open market from the beginning of t= he=20 California power crisis. We encourage FERC to reexamine these price caps an= d=20 continue that dedication said Joe Bob Perkins president and chief=20 operating officer Reliant Energy Wholesale Group. Reliant is committed to= =20 helping keep the lights on in California this summer and wants to ensure th= at=20 if caps must remain part of the picture they actually help increase supply= =20 and fix the problem.=20 Although the price caps were first imposed less than a week ago they have= =20 already begun to damage the market by decreasing supply. The price caps are= =20 creating a myriad of problems:=20 -- Creates Misleading Signals - The price cap methodology is misleading=20 the public on the actual cost of power. Reported dispatch costs in=20 Southern California during emergencies is far below what the actual=20 financial settlements will be under the FERC's final market mitigation=20 order. This confusion results from the proxy price used for=20 dispatch utilizing an extremely distorted blended fuel cost index.=20 This index averages gas costs in northern and southern parts of the=20 state an impossibility in the actual market. This authorizes the=20 California Independent System Operator (ISO) to require that=20 generators dispatch power at reported market clearing prices well=20 below actual cost when back-up generation capacity begins to dip below=20 7.5 percent.=20 -- Depletes Power from Peaking Plants - The price caps distort dispatch=20 signals on peaking plants which in some cases may be run only a few=20 days of the year because of emission regulations. The current FERC=20 price controls encourage the ISO to purchase power from emergency=20 peaking plants before it is really needed even in the absence of a=20 stage three emergency. This depletes supplies that will by law run=20 out when blackout season intensifies later this summer. This power=20 from peaking units should only be purchased when blackouts are=20 imminent -- not in stage one or two emergencies.=20 -- Eliminates Price Signals for Retail Customers - Price caps remove=20 price signals for retail customers. Customers particularly=20 industrial companies which should be encouraged to curtail during=20 shortages are not encouraged to conserve power when dispatched price=20 caps keep prices below the actual cost to produce electricity.=20 -- Discourages Supply from Out-of-State - Suppliers outside of=20 California who are under no legal obligation to dispatch power during=20 an emergency in the state are not encouraged to increase available=20 production when reported market clearing prices are below their cost=20 to produce. During times of emergencies utilities across the Western=20 region are not likely to take on additional risks and costs if they=20 don't believe they will be fully compensated - a situation the current=20 price caps create.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Reliant Energy=20 CONTACT: Maxine Enciso of Ketchum Public Relations Los Angeles=20 310-444-1303 for Reliant Energy or media Richard Wheatley of Reliant=20 Energy 713-207-5881=20 Photo: NewsCom: AP=20 Archive: http://photoarchive.ap.org PRN Photo Desk 888-776-6555 or=20 212-782-2840=20 Company News On-Call: or fax=20 800-758-5804 ext. 419090=20 Web site: http://www.reliantenergy.com (REI)=20 By Kathleen McFall kmcfall@ftenergy.com President George W. Bush's energy package encourages the use of biomass fue= ls=20 for both transportation purposes and electricity generation. They can=20 provide a reliable source of energy at a stable price and they can also=20 generate income for farmers landowners and others who harness them his= =20 administration's report said.=20 Despite this warm and fuzzy language however the administration offered n= o=20 tangible funding for the fledgling biofuels industry=01*other than an exten= sion=20 of an existing ethanol tax credit that was not due to expire until 2007=01*= a=20 significant disappointment and surprise to advocates of renewable=20 transportation fuels. The report did recommend expanding tax credits for biomass energy projects = to=20 include forest-related and agriculture fuel sources and threw its weighty= =20 support at a new credit for electricity produced from biomass co-fired with= =20 coal. These recommendations are already included in the president's 2002=20 budget.=20 We are pleased that the administration included expansion of the biomass t= ax=20 credit and hope that with congressional leadership we will see this=20 expanded provision signed into law this year said Katherine Hamilton=20 co-director of the American Bioenergy Association (ABA).=20 Unlike other portions of the recommended energy policy biomass energy=20 probably will not suffer under the recent change in Senate composition giv= en=20 Senate Majority Leader Tom Daschle's (D-S.D.) agricultural constituency and= =20 his previous support of the biofuels industry.=20 According to the National Energy Policy Development report biomass account= s=20 for about 76% of non-hydropower renewable electricity generation=20 representing a total of about 1.6% of total U.S. electricity supply.=20 Biopower advocates however envision an even greater market penetration in= =20 the coming decades and point to its environmental and ancillary advantages.= =20 For example given that biomass combustion can be carbon dioxide-neutral (i= f=20 the growth and use cycle is managed sustainably) environmental groups=20 support an expanded role. Farmers with marginal lands that could grow bioma= ss=20 fuel could enjoy economic benefits. With large amounts of wood residue the= =20 forest industry also stands to benefit from wider use of wood as a power=20 source.=20 Renewable energy offers a particular advantage to the lumber and paper=20 industry and many analysts project that the industry may soon become a net= =20 seller of electricity.=20 In the lumber and paper industries wood scraps are sometimes directly fed= =20 into boilers to produce steam for their manufacturing processes or to heat= =20 their buildings. For that reason renewable energy offers a particular=20 advantage to the lumber and paper industry and many analysts project that= =20 the industry may soon become a net seller of electricity said the energy= =20 policy report.=20 Co-firing with coal Biomass=01*usually wood or wood residue=01*has traditionally been burned di= rectly=20 in the industrial sector for heat or on-site electricity generation.=20 According to the U.S. Department of Energy (DOE) the existing 10 GW of=20 installed capacity are based on this direct-combustion technology.=20 For utilities and power-generating companies with coal-fired capacity=20 however biomass co-firing may represent one of the least-cost renewable=20 energy options said the DOE. The process involves blending different=20 materials in varying amounts with coal.=20 Not only does mixing biomass with coal reduce emissions it is likely to be= =20 cost-effective. Southern Co. estimates that a biomass plant alone could=20 generate power depending on its location at 4 to 11 cents/kWh. Given that= =20 the lower range of this corresponds to coal generation costs there are=20 clearly circumstances where biomass-coal co-firing would be economically=20 attractive today. Plus the environmental public relations benefit for=20 utilities with coal-fired capacity would be valuable.=20 Domestic biomass generation capacity could reach 20-30 GW by the year 2020 = by=20 co-firing at existing U.S. coal-fired power plants.=20 According to a recent report prepared by five National Laboratories domest= ic=20 biomass generation capacity could reach 20-30 GW by the year 2020 by=20 co-firing at existing U.S. coal-fired power plants.=20 A recent report by the United Nations Intergovernmental Panel for Climate= =20 Change (IPCC) also cites the potential of coal co-firing with biomass. The= =20 IPCC report concludes that co-firing in coal boilers results in the lowest= =20 cost and least technical risk of the examined approaches for biomass=20 conversion to electricity.=20 Working out the technical kinks Already said the DOE six power plants in the U.S. are currently co-firing= =20 coal and wood residue products on a regular basis. Another 10 plants have= =20 successfully tested co-firing over the last decade and at least six more= =20 plants are now conducting or planning tests.=20 For example Southern Co. is working with DOE the Southern Research=20 Institute and the Electric Power Research Institute to study ways to grow a= nd=20 harvest switchgrass to blend with coal as a fuel for power generation.=20 Ideally suited for the southeastern U.S. switchgrass is a rugged grass tha= t=20 can be grown on marginal agricultural land. Reaching heights of up to 12=20 feet it requires little fertilization and herbicide and can be harvested= =20 twice a year.=20 Harvesting methods co-milling of switchgrass and pulverized coal=20 pilot-scale co-firing tests and a full-scale demonstration of co-firing at= =20 Alabama Power Co.'s Plant Gadsden are part of Southern Co.'s collaborative= =20 project.=20 The U.S. Agriculture Department is also taking a role in exploring the=20 potential of biomass and coal co-firing as a means to give farmers new=20 markets especially for currently idle land. The agency recently authorized= =20 funding for three co-firing demonstration projects.=20 In Iowa the Chariton Valley Biomass Project is a cooperative effort to=20 develop warm and cool season grasses (such as switchgrass) to co-fire with= =20 coal at Alliant Energy's Ottumwa Generating Station. The project is designe= d=20 to generate a sustained supply of 35 MW of biomass energy. Eventually the= =20 grass could substitute for as much as 5% of the coal currently burned at th= e=20 plant.=20 In addition to reducing coal emissions the Chariton Valley Biomass Project= =20 will support the local farm economy.=20 In addition to reducing coal emissions the project will support the local= =20 farm economy because the grass and trees will come from acreage taken out o= f=20 production under the Agriculture Department's Conservation Reserve Program= =20 (CRP). CRP land is generally marginal land that the government subsidizes= =20 farmers to leave idle to both prevent erosion and protect commodity prices= =20 from product surpluses.=20 The Pennsylvania Switchgrass Energy and Conservation Project will produce= =20 switchgrass on CRP land for sale to a local cooperative's coal-fired=20 fluid-bed combustors.=20 In New York the Agriculture Department project will fund willow biomass=20 crops and switchgrass on CRP acreage in the central and western part of the= =20 state. The primary markets for the willow biomass are two coal-burning powe= r=20 plants and a small university central heating facility.=20 Land conflicts transportation may be obstacles As these pilot projects illustrate biomass conversion efforts may have the= =20 most significant potential in rural areas. Since biomass is widely=20 distributed it has good potential to provide rural areas with a renewable= =20 source of energy. The challenge is to provide =01( conversion and delivery = of=20 bioenergy to the marketplace in the form of modern and competitive energy= =20 sources said the IPCC report.=20 A potential drawback to co-firing is transportation. Transportation of=20 wood-based energy products is more costly per unit of energy than coal f= or=20 example and most analysts believe it will prove most economical to site=20 generation plants near biomass sources.=20 The generating plant or biorefinery must be located near to the resource t= o=20 minimize transport costs of the low-energy-density biomass as well as to=20 minimize impacts on air and water use the IPCC report said. However note= s=20 the report's authors economies of scale may be significant enough to offse= t=20 the transport costs involved.=20 A potential drawback over the long term however for biomass conversion is= =20 land use conflicts. The IPCC report notes that by 2100 the global land=20 requirement to feed the growing world population will increase substantiall= y.=20 Up until this time there may well be sufficient land to supply all demands= =20 for food fibre and energy but at some stage after that land-use conflict= s=20 could arise and before that competition for water and irrigation may be a= =20 constraint.=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: At the bottom of the string is Stacy's phone number What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: FW: Urgent/Confidential to ALL ON BLIND LIST: Speaker(s) Ne ede d to brief Governors Office Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EPSA Fall Membership Meeting, October 24-25,2000 Body:: calendar and meeting file What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: 2000 dividends Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: I would just say Jeff is pres and ceo not refer to him as Ken's replacement. Nicholas O'Day 03/08/2001 08:58 PM To: Steven J Kean/NA/Enron cc: Subject: Steve we briefly discussed last Tuesday the possibility of using Mr Lay's contact with the Chairman of Toyota Mr Okuda to assist us in securing a senior executive from Toyota to speak at the May 15 conference in Tokyo. We agreed that I should draft a letter for Jeff Skilling to send to Mr Okuda. I have had a rethink and believe that as a matter of courtesy (Japanese style) it would be preferable in the first instance if the contact with Mr Okuda is done from chairman to chairman. Mr Lay's letter will serve as an introduction to Jeff Skilling and will also permit Enron Japan to follow up directly with Mr Okuda's staff in Japan. We can then draft a letter for Jeff Skilling to confirm arrangements. I attach a draft letter for that purpose. If the revised approach is in order I will liaise on the matter with Rosalee and Sherri with a copy to you. kind regards What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Agreement Body:: Here is the latest copy. Once you may the changes I am going to run it by Mark Metts and send it over to CINergy. I am trying to get this sogned today so I can head down to Florida to meet up with Don and company. Thanks Ben ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: bilateral request Body:: No. Any idea how these guys are finding out where Jeff is going? Enron Capital & Trade Resources Corp. From: Joannie Williamson 04/03/2001 03:58 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: bilateral request Should I try to accommodate this request? Thanks Joannie ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: NEW DRAFT OF ENRON STATEMENT Body:: I know we are holding for a later filing but I have attached further comments anyway. The document is still too rough to send out. We need to take the opportunity as soon as possible to get a hard hitting thoroughly researched and carefully written document in front of the Commissioners. California's reaction to the Judge's recommendation is likely to give FERC (especially the new commissioners) a feel for how irrational the California politicians can be. We will have a limited opportunity to take advantage of that realization. We need to hit it hard in the pleading our conversations at the Commission the Hill and the media. Linda Robertson 07/09/2001 09:58 AM To: James D Steffes/NA/Enron@Enron cc: Alan Comnes/Enron@EnronXGate Carole Hodge/ETOL/EU/Enron@ETOL dwatkiss@bracepatt.com Jeff Dasovich/NA/Enron@ENRON Richard B Sanders/Enron@EnronXGate Richard Shapiro/NA/Enron@ENRON Robert Frank/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Steven J Kean/NA/Enron@ENRON Susan J Mara/NA/Enron@ENRON Subject: Re: NEW DRAFT OF ENRON STATEMENT Let me emphasize that these comments are to be filed COB TODAY. James D Steffes 07/09/2001 10:50 AM To: Robert Frank/NA/Enron@Enron Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Carole Hodge/ETOL/EU/Enron@ETOL Richard B Sanders/Enron@EnronXGate dwatkiss@bracepatt.com Alan Comnes/Enron@EnronXGate Susan J Mara/NA/Enron Jeff Dasovich/NA/Enron@Enron cc: Subject: NEW DRAFT OF ENRON STATEMENT HERE IS THE MOST RECENT STATEMENT WITH STEVE'S COMMENTS. Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: EGM presentaion and update Body:: Thanks for the updated presentation. It helps me a great deal to keep up with you guys. Send more as you do them. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Kenneth Lay, Chairman Enron Body:: Thanks. Yes I did know about the conference. Ken has a copy of the study and made reference to it several times during our visits to Sac. a couple of weeks ago. It's nice to occasionally see some rational thinking in California. I look forward to catching up with you when I get back to town. on 05/16/2001 09:27:00 AM To: skean@enron.com cc: Suzanne_Nimocks@mckinsey.com Subject: Re: Kenneth Lay Chairman Enron What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Wyoming Energy Commission subject Body:: Could you please put together a combined presentation : Enron's strategy and the need for open access on the transmission system? ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Press release Body:: Looks ok Peggy Mahoney@EES 08/25/2000 01:24 PM To: Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Cedric Burgher/Corp/Enron@ENRON cc: Subject: Press release New version. I think all suggested changes were made. Let me know soon!! Peggy ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Telephone Interview with The Enron Corp. Research Group Body:: Martin: Lance will be out of town on the 6th of December and he suggested that you interview Jingming (Marshall) in his place (it is a telephone=20 interview). =20 Can you do that? Thanks! Shirley ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: New York Times - Plan on California Energy Has No Shortage of Critics Body:: Content-Transfer-Encoding: quoted-printable Date: Fri 27 Apr 2001 10:22:32 -0500 From: Tracey Bradley To: Deanna King Justin Long Paul Fox Cc: Ronald Carroll Subject: New York Times - Plan on California Energy Has No Shortage of Critics Mime-Version: 1.0 Content-Type: text/plain charset=ISO-8859-1 Content-Disposition: inline FYI - Linda Stuntz is quoted in this article. She characterized the RTO filing requirement as bizarre. It appears to me that it is typical FERC behavior FERC likes to use whatever leverage it has to force compliance. April 27 2001 Plan on California Energy Has No Shortage of Critics By JOSEPH KAHN WASHINGTON April 26 * A novel plan by federal regulators to control California's runaway electricity prices is a messy politically motivated compromise that may offer some relief to consumers but will do little to fix the state's dysfunctional energy market analysts said today. The intervention announced by the Federal Energy Regulatory Commission on Wednesday night after much haggling was dismissed by a wide range of critics today as a flawed effort that satisfies no one. It fell short of the sweeping suspension of regional electricity deregulation that California officials and some energy experts had advocated. But it also crossed what has become a firm ideological line among Republican leaders including President Bush by imposing price controls on some electricity sales to utilities. Under the agency's order which takes effect on May 1 California regulators can begin to impose price controls on power generators when electricity supplies fall to within 7.5 percent of consumer demand. The state is expected to face such shortages routinely this summer and the order has the potential to shave billions of dollars off California's electricity bill if implemented fully some people at the federal agency say. The president has a long-held belief that price caps don't work the White House press secretary Ari Fleischer said today. The last thing you want to do is create artificially increased demand and put in disincentives that harm the availability of supply. Mr. Fleischer noted that the energy commission is an independent federal agency adding that the Bush administration has no authority to countermand its orders. But Mr. Bush did appoint the commission's chairman Curtis L. Hbert Jr. a Republican. Like the president Mr. Hbert has often insisted that price caps do no good. But he came under withering political pressure to abandon the agency's largely hands- off approach to the California crisis. Some of that pressure came from the two other commissioners at the agency both Democrats and Mr. Hbert wound up voting for the controls adopted on Wednesday night. The split with the Bush administration raises fresh questions about whether the president will seek to replace Mr. Hbert as chairman in coming weeks. Mr. Bush has nominated two Republicans to fill vacant slots on the commission including Pat Wood a longtime ally of the president who served as chief electricity regulator in Texas. Industry executives say they expect that Mr. Bush will eventually name Mr. Wood to the commission's top post. In a reflection of how delicate the issue is Mr. Hbert argued that the agency's action did not amount to imposing price caps. But his position appeared to rest on a semantic distinction between returning to cost- based electricity regulation (as some Californians favor) and the agency's decision to impose tactical price controls. Among California officials the dominant reaction was disappointment. Some state regulators and market experts said the agency was practicing upside-down economics: it has chosen to impose price limits during periods of severe scarcity when prices theoretically ought to rise to encourage companies to build power plants and encourage people to use less electricity. The agency its critics argue has chosen to ignore price abuses during times of relative abundance when power generators the critics say have used artificial market power to earn high profits. They got it exactly wrong said Frank Wolak chief market supervisor for the California Independent System Operator which runs the state's power grid. It looks like they're doing something but it doesn't work in real time. Mr. Wolak has estimated that most overcharges by generators last year * in amounts that he puts in the billions of dollars * occurred when electricity supplies were not acutely short meaning that the agency's price caps would have had no mitigating effect. The state is likely to face many emergency shortages this summer. But Mr. Wolak said generating companies have become adept at gaming the system. He predicted that they would find ways to continue to earn high profits in California. One fear is that generating companies will arrange to sell their output to affiliates out of state. When California's transmission grid managers scramble to find supplies the same companies will offer to sell the power back to the state but only above the cap price. The agency's new order includes a provision that is intended to discourage this sort of abuse known as megawatt laundering. But the agency has a weak record of enforcing such mandates and California officials are skeptical. The order also came under fire on other grounds. The commission said that price caps would be canceled unless California submitted a proposal to link its transmission grid to the one that serves the Western region a priority of the agency that state officials have resisted. Linda Stuntz an electricity industry lobbyist who is an expert on the agency called that clause bizarre arguing that it held the entire California market hostage to a technical filing requirement. California politicians said they worried that even if the price caps were carried out as promised relief would be too limited. The price limits will be based on estimates of the highest operating costs of the least efficient generating plant in the state. The order as written means that companies that operate efficient generating plants could still sell power at large mark-ups during periods when caps are imposed. When the agency scrutinized the California market earlier this year it found the high-cost generators to be justified in charging about $300 a megawatt hour for electricity a price that is about 10 times as high as the state was paying for power a year ago. Copyright 2001 The New York Times Company What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: SDG&E Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Talking Points re ""reregulation"" in California Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: FYI Item: Rob Gramlich formerly with FERC PJM and most recently PG&E NEG will be taking a position as Chief Economic Advisor for Chair Pat Wood effective I October. For what its worth Belden Gramlich and I all worked together in the mid-90s. (I hired Rob as a research assistant in 1994 when I was a scientist at Lawrence Berkeley National Lab.) Alan Comnes What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Joe asked me to get in touch with you regarding Indian media reports/inquiries on possible sale or sell down of Dabhol and to discuss a possible statement in the event we get additional inquiries. Give me a call - 713-853-1586 home: 713-621-6550 pager: 888-906-9761. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Thank you all very much for your support - NOT! Body:: I genuinely believed in Enron and the Values of the company You demonstrated that that trust was misplaced and worth nothing I particularly like your adherance to the core values - you respected us you communicated brilliantly with us your fucking us over was excellent your integrity was without question You load of bastards - you screwed us all and got fat on the profits of our sweat I hope that the board and upper management rot in jail and never see the light of day again - apart from when you are exercising in the open prison yard in your shackles Just Another Fucked Over Ex-Employee Get your FREE download of MSN Explorer at What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions Body:: See last story attached. Congratulations it looks like you are shaking things up in typical Enron fashion. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: These are good fixes. I still think it's important for our security people to be able to recognize all of our senior executives and make sure their guests get where they are going quickly. To: Steven J Kean/HOU/EES@EES cc: Susan Skarness/HOU/ECT@ECT Subject: Follow-up Steve - Following up on our conversation Friday we have advised Cliff Baxter's Assistant that effective immediately Cliff and his quests can pass through Security on the Plaza without showing his access card or requiring his quests to sign in or identify themselves. All he needs to do is approach the front Reception Desks and asking for entry. The receptionists will recognise Cliff by sight and ensure that he and his quests pass through - without delay - by lifting the adjacent rope. We are asking Cliff to use his badge at the card readers as per standard procedure when he is entering the building by himself. We are also refining procedures and upgrading our IT systems/data base @ the Reception Desk to make it easier on a visitor of any employee. For example if you call down to the Plaza Reception Desk and advise that a visitor is expected the receptionist will have a pass prepared so as to eliminate the sign in process. The guest simply has to exchange their business card for the visitor pass. Or if an employee shows their access card at the Reception Desk and asks that their guest gain entry that guest can get a badge without signing in. Again we ask that the guest exchange their business card for a visitor pass. We are working on installing a new data base @ the Desk that will pull up a digitised photo of the employee (duplicate of what's on their badge) on the screen. This will allow employees to get a temporary access badge without showing other ID and will speed process. Finally we are testing a small proximity access card which is designed to be a duplicate back-up for executives. It is sized to fit on a key chain and works with our standard card readers. - Bill What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Crisis Management at Enron Body:: Contact Mike Terraso (who heads the environmental function) and Mike Hicks (who oversees corporate security). Jason Sokolov@ECT 10/11/2000 08:46 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: Crisis Management at Enron Steven I have not spoken to you in a while! How are things going? I have a question for you. I am enrolled in a Corporate Crisis MGMT class at Rice and my assignment for the up-coming Tuesday is to evaluate the crisis system (if there is one) at Enron. Do you happen to know anything about Crisis Management in our company? Let me know at your earliest convenience.. Jason Sokolov What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CONFIDENTIAL - Residential in CA Body:: Amen. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: to cheer up the day Body:: ----------------- What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Highlands Forum Wrap-up Body:: Thank you. I enjoyed the discussion very much. The DoD has significant challenges but if the group participating in the meeting was any indication they have some first rate people working on those challenges. If I can be of further assistance do not hesitate to call. Dick O'Neill on 07/02/2001 11:27:16 AM Please respond to To: cc: Subject: Highlands Forum Wrap-up Dear Steve: just a brief note to say thank you again for your excellent presentation at last week's Highlands Forum. I believe that your remarks along with those of Goran Lindahl Dick Foster and Phil Condit of Boeing have caused a significant stir in the preparation for the congressionally mandated Quadrennial Defense Review and the Secretary's transformation planning. I also can tell you that the feedback from participants regarding your briefing has been terrific. We are reviewing all the material this week to begin the process of re-creating the session on the Secretary's webpage for the Forum and I will be going over the video and audio clips for posting. Recognizing that your slides were proprietary it would be most valuable if we could post as much of your powerpoint briefing as possible--whatever you feel comfortable with sharing. Whatever that turns out to be if your staff could email that to me I will make sure that only that and not the original that you sent to me gets posted. I am not sure where the senior leadership of the DoD will be going in the coming months however I know that the discussion of your experience at Enron and the experiences of your panel mates will have an influence. A more formal letter of thanks will be forthcoming but for now thank you again for joining us and helping to make this a memorable and most important Highlands Forum. Best regards Dick Dick O'Neill The Highlands Group http://www.highlandsgroup.net 301-469-7400 301-469-5878 fax What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RTO Legal Question Body:: I am working on an analysis of the details of the Barton draft RTO language. While it is highly objectionable and our goal is to kill it to do so we need to respond to requests to be specific about why we don't like it. One of the more objectionable provisions says that FERC can't change the scope governance etc. of any RTO that has been approved under Order 2000 prior to enactment of the legislation. If this applies to PJM the legislation would stop the Northeast-wide RTO in its tracks since several of you and PJM's Phil Harris testified last week that FERC has approved PJM. By contrast committee staff and the section-by-section they distributed on the RTO legislative proposal say that to date FERC has NOT approved any RTOs under Order 2000. They say that the legislative language would not apply to any RTO as of this date because FERC approvals of PJM Cal ISO and NePool have been approved under the ISO principles of Order 888. Your thoughts on the above would be helpful. Either way I think we can argue that the provision shows why the Barton proposal is a retrenchment rather than an advancement on RTOs. If it does not apply to PJM and the others as they contend there is no good reason to include it other than to freeze the process at FERC merely by having the legislation pending on the Hill much less enacted into law. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: risk 2001 follow up Body:: Peter Look forward to meeting you in Houston. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: CONFIDENTIAL Personnel issue Body:: I've got a call into Valeria. --Lizzette What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: 5 visitors from Enron Broadband Services (EBS), formerly Enron Communications Inc Body:: It looks like Enron Japan was kept in the loop. Let's keep it up. Good luck ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CAISO NOTICE: Freedom of Information Request of confidential atta chments to the DMA report filed with FERC on March 1, 2001 Body:: So why did the ISO make the attachments confidential if it does not believe that they are confidential. If the attachments are to be released they should be released to everyone. How do we make that happen? Sue Mara Enron Corp. Tel: (415) 782-7802 Fax:(415) 782-7854 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Customers Body:: You may want to forward this to your customers. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Draft NPC Report Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Contact Steve Kean Body:: Feel free to call me at 713.853.1586. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Fri 5/4: Expect prices to shoot up analysts say Sac Bee Fri 5/4: GOP: Shrink plan for bonds Sac Bee Fri 5/4: FERC chief defends plan for state Sac Bee Fri 5/4: PG&E to judge: ISO $1 billion tab will drain us Sac Bee Fri 5/4: Jack Sirard: PG&E's woes a warning to utility investor= s SD Union (AP) Fri 5/4: Legislature sends power authority bill to govern= or LA Times Fri 5/4: GOP Tries to Force Its Dramatically Different Energy Plan on Governor LA Times Fri 5/4: Secretary of Energy Davis Meet on U.S. Plan to Boost Conservation LA Times Fri 5/4: PG&E Seeks Relief From High-Priced Power Purchases LA Times Fri 5/4: SDG&E Blackout Plan Would Pay Firms to Use Generators= SF Chron Fri 5/4: Been there done that=20 Bay Area finds little new in Bush's ideas SF Chron Fri 5/4: Bush calls power supply the solution=20 He says conservation useful but secondary SF Chron (AP) Fri 5/4: SDG&E unveils plan to contend with rolling=20 blackouts SF Chron (AP) Fri 5/4: California crisis brings new talk of energy=20 conservation=20 SF Chron (AP) Fri 5/4: Developments in California's energy crisis SF Chron Fri 5/4: Energy at a glance SF Chron Fri 5/4: Ships would help during blackouts=20 Ready reserve fleet has power to provide=20 SF Chron Fri 5/4: PG&E chairman wants to keep power lines Mercury News Fri 5/4: Bush shifts policy on conservation after meeting= =20 with GOP Mercury News Fri 5/4: Senate plans public power Mercury News Fri 5/4: All Caps Hed OC Register Fri 5/4: Energy notebook Vote delayed on $12 billion state bond for power OC Register Fri 5/4: US conservation order called Bush's best effort Individual.com (Bridgenews) Fri 5/4: [B] POWER UPDATE/ Bush directs fed= s to save energy in California Individual.com (AP) Fri 5/4: Judge Dismisses $10B PG&E Suit Individual.com (Business wire) Fri 5/4: Bankruptcy Update/ PG&E Files= =20 Motion to Require CAISO to Follow Federal Law --- Expect prices to shoot up analysts say By Dale Kasler Bee Staff Writer (Published May 4 2001)=20 Gov. Gray Davis' plan for solving the energy crisis relies partly on a=20 striking assumption: that the state's power expenditures will drop=20 dramatically this summer.=20 But energy-market analysts believe Davis is underestimating the cost of=20 electricity and say the state should brace for a significant run-up in pric= es=20 during what is likely to be a summer of chronic shortages.=20 In particular analysts question Davis' prediction the state will pay an=20 average of $195 a megawatt-hour on the spot market from July to September = a=20 44 percent reduction from the projected average price for April through Jun= e.=20 One hundred and ninety-five dollars? Boy I wish it were true said Sever= in=20 Borenstein of the University of California Energy Institute. My estimate i= s=20 substantially higher.=20 Yet Davis' advisers are sticking by their projection of the state's power= =20 costs released Monday to a skeptical Legislature by private consultants to= =20 the governor. They say the lower cost estimates reflect expected increases = in=20 supplies the projected impact of California's new conservation program and= =20 the state's growing ability to wean itself from the ultra-expensive spot=20 market and buy much of its power through cheaper long-term contracts.=20 Prices may rise but spending by the state will decline starting this=20 summer they insist.=20 This is a very credible plan said Joseph Fichera a Wall Street financie= r=20 advising the governor. We have done things to mitigate our exposure (to th= e=20 spot market).=20 The credibility of the projections is crucial to the state's plan to sell $= 10=20 billion worth of bonds -- a key element of Davis' rescue plan. The bonds=20 would compensate the state for past and future power purchases made on beha= lf=20 of moribund Southern California Edison and Pacific Gas and Electric Co. wi= th=20 ratepayers ultimately footing the bill. Davis expects the state to spend=20 $18.7 billion on power by June 2002.=20 But if electricity costs go higher than Davis expects the strain on the=20 state's budget could worsen complicating the bond sale. Republican=20 lawmakers wary of higher costs and distrustful of Davis' projections have= =20 been threatening to block the sale.=20 Higher-than-expected costs also would increase the likelihood of blackouts= =20 Davis acknowledged last week that the state might stop purchasing electrici= ty=20 at times when prices go out of sight.=20 And many private-sector experts believe prices will surely rise.=20 I see no reason given what's happened the past six months that the next= =20 six months is going to be dramatically different said Keith Bailey chief= =20 executive of generator Williams Cos. which sells power to California.=20 One great unknown is the impact of a price mitigation plan approved last= =20 week by the Federal Energy Regulatory Commission. Price caps would kick in= =20 when California's power reserves are less than 7 percent of demand -- the= =20 so-called power alert days.=20 Bailey said the plan would have a very real effect but state officials= =20 called it inadequate. More holes than Swiss cheese Davis said this week.= =20 In Washington Sen. Dianne Feinstein D-Calif. and other Western senators= =20 tore into FERC Chairman Curtis Hebert Jr. at a hearing on the price=20 mitigation plan. Feinstein wondered aloud why the FERC didn't simply=20 establish a firm ceiling on prices.=20 As it stands now California officials have been spending upward of $50=20 million a day for Edison and PG&E the tab can fluctuate wildly from day to= =20 day as prices shoot up and down. On Thursday prices in California ranged= =20 between $214 and $240 a megawatt-hour depending on location for peak-time= =20 power according to industry newsletter Enerfax Daily.=20 Because summertime demand is typically about 50 percent higher than it is i= n=20 spring most analysts expect prices to rise. California electricity futures= =20 prices considered by many to be a decent gauge of where prices are going= =20 are trading at $375 a megawatt-hour for July and $525 for August Enerfax= =20 said.=20 I would trust the traders said Gary Ackerman of the Western Power Tradin= g=20 Forum an association of power generators. They've been right more often= =20 than the Davis administration.=20 The Northwest drought robbing California of cheap hydropower is a key=20 reason many analysts believe costs won't drop.=20 What it all adds up to is much less imported hydroelectric power than we'r= e=20 used to said Arthur O'Donnell editor of the California Energy Markets=20 newsletter.=20 But Davis' consultants say new power is coming from other sources this=20 summer easing prices. New power plants scheduled to begin operations this= =20 summer will add 4500 megawatts of power to California's energy-starved=20 grid Davis said.=20 O'Donnell though said the new plants won't provide immediate relief. Pow= er=20 plants in their start-up phase frequently have problems he said.=20 Another unknown quantity is the fate of hundreds of cogenerators wind farm= s=20 and other alternative-energy providers that deliver more than 20 percent of= =20 the state's electricity under contract to the utilities.=20 After going months without payment from PG&E and Edison scores of these=20 producers shut down in February and March depriving the state of an=20 estimated 3000 megawatts of power and contributing mightily to two days of= =20 blackouts in March.=20 About 800 megawatts of power returned to service in April after PG&E and= =20 Edison were ordered to resume paying the generators the two utilities said= .=20 And Fichera said more will come back starting June 1 when their contracts= =20 say they must operate or face financial penalties.=20 But some generators say they won't produce full throttle this summer. Anger= ed=20 at a new payment schedule that substantially cuts their income they'll run= =20 the absolute bare minimum to fulfill their contracts said Hal Dittmer of= =20 Wellhead Electric Co. a small generator that's been shut down.=20 Representatives of the small generators met with Davis on Thursday with=20 Davis agreeing to work with them on the possibility of increasing their=20 payments said generators' attorney Jerry Bloom.=20 Davis meanwhile also is betting that energy usage will fall. Recently=20 approved rate hikes will create sticker shock that will cut demand 3=20 percent Fichera said. The state's conservation program will contribute an= =20 additional 4 percent he said.=20 If we buy less than what (generators) expect prices drop Davis said.=20 Above all the state has completed or is in final negotiations on a slew of= =20 long-term contracts with major generators -- deals that will substantially= =20 cut the state's dependence on the spot market and reduce its overall power= =20 bill said Ron Nichols of Navigant Consulting Inc. which developed the=20 power-cost estimates for Davis.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m.=20 David Whitney of The Bee's Washington Bureau contributed to this report.=20 GOP: Shrink plan for bonds By John Hill Bee Capitol Bureau (Published May 4 2001)=20 The state should bite the bullet and use $5 billion of its surplus to pay f= or=20 electricity instead of borrowing the money and prolonging the fiscal agony= =20 Assembly Republicans said Thursday.=20 Paying up front is preferable to a Democratic plan that would saddle=20 electric customers with higher utility rates to pay the state back with=20 interest said Assemblyman Bill Leonard of San Bernardino one of 30 membe= rs=20 of the Assembly Republican Caucus.=20 But the caucus's plan drew fire from state Treasurer Phil Angelides a=20 Democrat in charge of putting together the bond deal. He said a GOP block o= f=20 the bond deal would cut into this year's spending for education and=20 transportation and take the state toward fiscal insolvency.=20 Angelides said the Republican stance will force the Legislature to pass the= =20 bill authorizing bonds with a simple majority needing no GOP votes but=20 requiring a 90-day wait for the bill to become law. By that time he said= =20 the state will be perilously close to running out of money.=20 It is to me from a business perspective one of the most irresponsible ac= ts=20 I've witnessed he said.=20 The Assembly Republican plan calls for the state to sell $8 billion in bond= s=20 instead of the $12.5 billion proposed by Gov. Gray Davis. This move would= =20 relieve pressure for more electricity rate increases Leonard said.=20 The Republicans would make up the difference by taking $5 billion from the= =20 state's general fund. That's money the Democratic governor proposed in=20 January would go to one-time expenditures on a variety of projects from=20 clean beaches to housing as well as new spending on schools.=20 The Republican plan calls for rate rebates for people whose electric=20 utilities are publicly owned such as the Sacramento Municipal Utility=20 District. Some argue that these ratepayers are getting a bad deal because= =20 their tax money is subsidizing ratepayers whose utilities are in financial= =20 trouble.=20 It also includes past Republican proposals that have stagnated in the=20 Legislature such as allowing residential customers to make deals with=20 independent electricity providers and encouraging quick building of power= =20 plants.=20 Although the Republicans are in the minority they wield leverage in the=20 energy debate because a bill that would authorize a bond sale requires a=20 two-thirds vote. At least five of the 30 Assembly Republicans would have to= =20 vote for it.=20 The Republicans say they are uncomfortable with the size of the bond deal= =20 proposed by Davis which combined with other energy bond sales could top $2= 0=20 billion. It's too much to swallow said James Fisfis a spokesman for the= =20 caucus.=20 Fisfis said the plan represents a preliminary response to Democratic=20 proposals -- a starting point in negotiations and a vision of Republicans= =20 and what they would do if they were governing.=20 We don't want those phony messages that everything's fine and hunky-dory= =20 and it's not he said. This is a time for financial restraint.=20 The Republican proposal blasts as expensive gimmickry a plan by Angelides= =20 to get a $4.1 billion bridge loan from three major lenders to keep the stat= e=20 flush until the bonds are sold.=20 Angelides said such loans are routine when California and other states sell= =20 bonds. The loan in this case he said provides momentum for what's likel= y=20 to be the biggest bond sale in U.S. history. It's three of the most powerf= ul=20 investment banks in the country side by side with us signalling to the wor= ld=20 marketplace that they believe in this transaction he said.=20 The fees to the investment banks of several million dollars represent a=20 fraction of one day of the state's power costs he said.=20 Legislative Analyst Elizabeth Hill said the proposal would require all $2.3= =20 billion in one-time expenditures in the governor's budget to be axed as we= ll=20 as $2.7 billion of proposed year-to-year spending.=20 In addition state revenues for the fiscal year starting July 1 appear to b= e=20 lower than anticipated so the Republican plan might force even more cuts= =20 she said.=20 The Republican caucus plan came the same day that Secretary of State Bill= =20 Jones the lone Republican statewide officeholder and a GOP candidate for= =20 governor next year released his own ideas on the energy crisis.=20 Jones in a letter to Vice President Dick Cheney said the state is on the= =20 brink of fiscal insolvency because of Davis' efforts to buy power.=20 Instead of selling bonds or negotiating to buy the utility companies'=20 transmission lines or other assets the state should ask power generators t= o=20 forgive some of the nearly $14 billion they're owed in exchange for immedia= te=20 payment Jones said.=20 In addition the state should offer low-interest loans to utilities to help= =20 them repay their debt using the power lines as collateral. Finally he sai= d=20 the utilities' parent companies should help reduce the debt.=20 While Jones said the Davis plan is socializing the delivery of power the= =20 state Senate on Thursday sent the governor a bill that will likely drive th= e=20 state further into the energy business by allowing a public power authority= =20 to run its own power plants.=20 The authorizing bill SB 6x by state Senate President Pro Tem John Burton= =20 D-San Francisco passed the Senate on a 24-14 party-line vote.=20 The agency would have access to $5 billion in bond money with which it coul= d=20 build run and seize power facilities and institute conservation programs.= =20 The Bee's John Hill can be reached at (916) 326-5543 or jhill@sacbee.com.= =20 Kevin Yamamura of The Bee Capitol Bureau contributed to this report.=20 FERC chief defends plan for state=20 By David Whitney and David Westphal Bee Washington Bureau (Published May 4 2001)=20 WASHINGTON -- The chairman of the Federal Energy Regulatory Commission=20 sternly defended the panel's new plan for controlling California electricit= y=20 prices Thursday amid mounting criticism that it is too little and too late = to=20 do much good.=20 The criticism came from Democrats and one Republican Oregon Sen. Gordon=20 Smith at a hastily arranged hearing of the Senate Energy and Natural=20 Resources Committee that was intended to be a forum for FERC Chairman Curt= =20 Hebert Jr. to dispel concerns that the plan won't protect consumers from=20 price-gouging electricity marketers.=20 The order approved last week by a 2-1 vote is supposed to dampen prices= =20 without rigid price controls by ordering generators to sell all the power= =20 they produce and setting a benchmark price based on the highest-cost=20 least-efficient plant operating during periods of emergency shortages.=20 FERC is acting Hebert said. FERC is acting responsibly. ... We're doing= =20 what we can do.=20 But the commission's lone dissenter on last week's order William Massey= =20 charged that the measures to control skyrocketing prices would be in effect= =20 only during power emergencies when supplies were tightest. And while that= =20 might be as much as 40 percent or 45 percent of the time during the long ho= t=20 summer he said that still leaves most of the time when power marketers ar= e=20 free to sell at whatever price they can get.=20 I have no confidence that prices will be fair and just at all times this= =20 summer Massey said.=20 Sen. Dianne Feinstein D-Calif. continued on that theme. She produced what= =20 was described as a megawatt laundering blueprint she had received detaili= ng=20 how FERC's order could be used to trade power back and forth between=20 marketers to bid up wholesale prices in a way that would be outside FERC=20 monitoring.=20 The contentious hearing came as the FERC is about to publish notice in the= =20 Federal Register to expand the price monitoring plan to Oregon Washington= =20 and other Western states.=20 But Smith said he thought the commission was misreading the political=20 firestorm brewing throughout the West if it thought its plan would quell=20 outrage over rising prices.=20 Are you aware of the head of steam that is building up? asked Smith who= =20 said prices in his region are 10 or 12 times what they were a year ago. Th= is=20 is unsustainable for this administration for this Congress.=20 Smith and Feinstein have introduced legislation that would temporarily cap= =20 wholesale power rates at the cost of production plus a fixed profit margin.= =20 Feinstein who was more supportive of the FERC order after its release last= =20 week said after the hearing that she now believes it is flawed by too many= =20 loopholes and problems.=20 I can't understand why they are doing this she said.=20 Meanwhile one of California's biggest power customers the U.S. military= =20 vowed Thursday to reduce its peak-hours electricity use by 10 percent this= =20 summer as President Bush expressed new concern about the state's looming=20 season of blackouts.=20 We're worried about blackouts that may occur this summer and we want to be= =20 part of any solutions said Bush who gave federal officials 30 days to=20 implement electricity-reducing plans.=20 Gov. Gray Davis welcomed the president's comments but said the plan falls= =20 short. Surely the federal government can do more and match California's 20= =20 percent savings at all state buildings he said.=20 Vice President Dick Cheney in a speech earlier this week spoke dismissive= ly=20 of conservation efforts in the 1970s and warned that the nation won't be= =20 able to simply conserve or ration our way out of the situation we're in.= =20 But Bush spoke repeatedly Thursday of the importance of conserving. We've= =20 got to do both he said. We must conserve but we've also got to find new= =20 sources of energy.=20 The administration set no target for reducing federal power use but=20 recommended actions such as turning off escalators and raising thermostats = to=20 78 degrees when state reserves fall below 5 percent.=20 We're not trying to pick a figure arbitrarily out of the sky said Energy= =20 Secretary Spencer Abraham.=20 Earlier in a letter to Congress Davis excoriated federal inaction on=20 soaring electricity rates as he prepared to meet in Sacramento with Abraham= =20 on Thursday evening.=20 With all our actions in California it is a travesty that on the one issue= =20 over which the federal government has exclusive jurisdiction -- wholesale= =20 energy prices -- it has utterly failed to discharge its responsibility=20 Davis said.=20 The Bee's David Whitney can be reached at (202) 383-0004 or=20 dwhitney@mcclatchydc.com.=20 PG&E to judge: ISO $1 billion tab will drain us By Claire Cooper Bee Legal Affairs Writer (Published May 4 2001)=20 SAN FRANCISCO -- Pacific Gas and Electric Co. asked a federal bankruptcy=20 judge Thursday to bar the operator of California's power grid from buying= =20 electricity for the utility or collecting almost $1 billion now due for pas= t=20 wholesale purchases.=20 PG&E's bankruptcy estate would be depleted by paying the high prices passed= =20 on by the California Independent System Operator the utility said in askin= g=20 U.S. Bankruptcy Judge Dennis Montali to issue an injunction.=20 PG&E filed for Chapter 11 bankruptcy reorganization April 6. The utility's= =20 corporate parent San Francisco-based PG&E Corp. is not part of the=20 bankruptcy proceedings.=20 The ISO buys electricity from independent wholesalers to supplement whateve= r=20 power the utilities can send to the grid matching supply with demand on a= =20 daily basis. Throughout the past year it has provided as much as 30 percent= =20 of the state's electricity and as little as 10 percent on any given day sa= id=20 ISO spokesman Patrick Dorinson.=20 ISO Vice President Elena Schmid said Thursday that the ISO stopped buying= =20 electricity for PG&E after being told to do so April 6 by the Federal Energ= y=20 Regulatory Commission because the utility no longer was creditworthy.=20 But the PG&E legal complaint said the ISO continued making purchases throug= h=20 April 30 at an average cost almost six times as high as the frozen retail= =20 rates that PG&E can charge its customers.=20 Even with an upcoming rate increase said the complaint PG&E could lose $2= 28=20 million a month if it depended on the ISO for 25 percent of its electricity= .=20 Since mid-January the California Department of Water Resources also has be= en=20 buying electricity for PG&E and Southern California Edison under AB 1x=20 legislation that authorized state power purchases and rate increases if=20 necessary to repay the state.=20 PG&E said in the complaint that the state water department has limited its= =20 purchases to power it can buy at rates it deems reasonable leaving it to t= he=20 ISO to obtain at extremely high rates the remainder of the electricity PG= &E=20 needed to balance supply and demand.=20 PG&E has been able to generate or has contracts for between 50 percent and = 60=20 percent of its retail electricity demand.=20 PG&E spokesman Ron Low said the DWR has been buying about 85 percent of the= =20 balance but the company doesn't know how much the ISO is buying until it= =20 receives the bills.=20 ISO's Schmid said no decision had been reached concerning the effect of the= =20 bankruptcy proceedings on PG&E's outstanding billion-dollar bill for=20 electricity purchases in January and February.=20 We're certainly going to live by whatever terms the Bankruptcy Court puts = on=20 it she said.=20 Two weeks ago ISO advised PG&E that ISO's January and February invoices t= o=20 the extent they conflicted with the bankruptcy process were submitted only= =20 for record-keeping purposes.=20 But PG&E said ISO still plans to hold the company responsible for the bills= .=20 A hearing has been set for June 4.=20 The Bee's Claire Cooper can be reached at (415) 551-7701 or=20 ccooper@sacbee.com.=20 Jack Sirard: PG&E's woes a warning to utility investors (Published May 4 2001)=20 Q: Like so many other investors I bailed out of my Pacific Gas and Electri= c=20 shares. I am now looking at Con Ed. It looks fairly priced with a great=20 yield. Would it be wise to take the money I got from PG&E and buy Con Ed?= =20 My biggest concern is that Con Ed could suffer a fate similar to the one th= at=20 devastated PG&E. What do you think?=20 --Robert A. Carmichael=20 A: Consolidated Edison (ticker symbol ED) is one of the nation's largest=20 investor-owned energy companies. The company provides a wide range of=20 energy-related services to customers in New York New Jersey and=20 Pennsylvania.=20 For the three months ended March 31 revenues increased 24 percent to $2.89= =20 billion while its net income declined 5 percent to $179.1 million.=20 The company's stock closed Thursday at $36.26 near its 52-week high of=20 $39.50 and well above its low of $29.61. The company pays a generous annual= =20 dividend of $2.20 a share giving it a current yield of 6.04 percent.=20 Last week the company said it would spend $483 million this year as part of= a=20 program to prepare for the summer of 2001 enhance reliability and improve= =20 infrastructure. And over the next five years Con Ed plans to invest $2.4= =20 billion to upgrade its electric delivery system which serves New York City= =20 and Westchester County.=20 You're certainly right to be concerned about any utility's plans to deal wi= th=20 the energy crisis.=20 Here's what I found about Con Ed. The company sold most of its power plants= =20 and like California utilities failed to lock in multiyear contracts with= =20 suppliers to protect its customers against rising wholesale prices. But Con= =20 Ed can pass wholesale electricity price increases through to consumers. Las= t=20 summer a spike in wholesale prices briefly pushed Con Ed electric rates up= =20 43 percent and that could happen again this summer.=20 Value Line says Con Ed stock is expected to lag the market but says=20 income-oriented investors might want to build a stake. The company has been= =20 increasing its dividend slowly but surely over the years. If you buy the=20 stock keep a close eye on it. Utilities unfortunately no longer can be= =20 bought and tucked away.=20 Q: Our gross income is $100000 a year and other than our house payment w= e=20 have no outstanding debt except a car payment of $250 a month. We have abou= t=20 $175000 in investments including our stocks mutual funds and 401(k) whic= h=20 we are adding about $1000 a month to.=20 We have two kids age 10 and 12 and hope to retire from our jobs with the= =20 state in about seven years at age 53 to 55 and convert our investments to 2= 5=20 percent CDs 25 percent bond funds 25 percent stocks and 25 percent mutual= =20 funds. What do you think?=20 --Jim R. Sacramento=20 A: After looking at the stocks (down 74 percent) and mutual funds (down 51= =20 percent) that you have bought on your own I'd suggest that you need=20 professional help with your investing. Admittedly you have taken a hit by= =20 being heavily invested in technology components. By comparison your 401(k)= =20 is down only 23 percent.=20 Instead of being concerned about how to invest once you retired if I were= =20 you I'd focus my attention on whether I had enough money to retire. Becaus= e=20 you and your spouse both work for the state your retirement benefits shoul= d=20 be solid but I think you need to get a professional review of your financi= al=20 situation to see if all the numbers add up. At first glance it doesn't loo= k=20 to me that they do.=20 You're at the age when you need to have a financial game plan in place that= =20 can pay for college for the children and your own retirement. In your case = --=20 as with many others -- spending some time and money now with a professional= =20 will pay off in the future.=20 The Bee's Jack Sirard can be reached at (916)321-1041 or jsirard@sacbee.com= =20 Legislature sends power authority bill to governor=20 By Audrey Cooper ASSOCIATED PRESS=20 May 3 2001=20 SACRAMENTO =01) California is poised to enter the power business after the = state=20 Senate approved the creation of a public power authority and sent its bill = to=20 Gov. Gray Davis Thursday.=20 A power authority supporters said will give the state more control over i= ts=20 wholesale electricity market by building and operating its own power plants= .=20 State-owned plants could charge lower prices and building new plants could= =20 increase supply and ease wholesale prices.=20 If signed by the Davis the bill creates a California Consumer Power and=20 Conservation Financing Authority that could issue up to $5 billion in reven= ue=20 bonds to pay for power plants natural gas storage and additional pipelines= =20 and conservation programs.=20 Davis has said he supports creating a public power authority similar to one= =20 in New York. The New York authority has 10 power plants 1400 miles of=20 transmission lines and produces about 25 percent of the state's power.=20 Nebraska also has a power authority which created a market in which=20 residents pay 22 percent less than the national average said Sen. John=20 Burton D-San Francisco who wrote the bill.=20 A Davis spokesman said Thursday that although the governor has supported th= e=20 concept of a power authority he has not decided whether or not to sign the= =20 legislation.=20 The authority would be run by the state treasurer and four other members=20 appointed by the governor.=20 Opponents of the plan most of them Republicans have said an authority=20 thrusts the state into a power market in which it doesn't belong and could= =20 obstruct private interests' efforts to build and operate power plants.=20 The new board would also be able to seize plants by eminent domain a power= =20 the governor also has under an emergency order issued in January.=20 Sen. Steve Peace D-El Cajon said California needs the authority because t= he=20 1996 deregulation law didn't create real competition and the Federal Energy= =20 Regulatory Commission refuses to control rising wholesale prices.=20 The state's deregulation is the economic equivalent to the World Wrestling= =20 Federation Peace said. The wrestlers follow a script and the referee=20 FERC ensures it is entertaining. It is not real competition.=20 The authority won't help the state escape blackouts this summer but will= =20 help restore reliable and affordable electricity in the future said consum= er=20 advocate Harvey Rosenfield with the Foundation for Taxpayer and Consumer=20 Rights.=20 The agency is California's key to survival and independence from the energ= y=20 cartel he said.=20 Davis and state lawmakers are also considering purchasing Southern Californ= ia=20 Edison's transmission system which would be governed by a separate public= =20 authority. Negotiations with San Diego Gas & Electric Co. are continuing. T= he=20 Legislature would have to approve those buys.=20 The authority's main power would be over generator construction said=20 Stanford University economist Frank Wolak. Energy companies would likely be= =20 hired to build the plants something the companies are already pursuing.=20 As far as operating power plants we're not as good as these other guys=20 are he said.=20 However the authority may speed the siting of power plants an approval=20 process mostly anchored in state agencies. Centering the approval process i= n=20 the state government could speed the process he said.=20 Richard Sklar the governor's new energy czar said the goal of the state's= =20 power authority will be to balance the energy market in California and keep= =20 private companies from controlling the prices.=20 The power authority is a sensible long-term strategy Sklar said. It's n= ot=20 a bad idea for the state if the private sector will not build it to build= =20 plants so supply won't fall short of demand and this game won't be able to = be=20 played.=20 Opponents said California should create total deregulation of the electrici= ty=20 market not a government solution.=20 The 24-14 vote on the bill written by San Francisco Democratic Sen. John= =20 Burton was split down party lines.=20 Some of the most feared words in the English language are 'I'm from the=20 government and I'm here to help you' said Sen. Bill Morrow R-Oceanside.= =20 The state Assembly passed the bill last week in a 47-28 vote split along=20 party lines.=20 Pacific Gas and Electric Co. spokesman Ron Low declined comment on the=20 legislation. Officials from San Diego Gas and Electric Co. didn't return=20 calls seeking comment.=20 ?? Read Burton's SB6X www.leginfo.ca.gov=20 GOP Tries to Force Its Dramatically Different Energy Plan on Governor=20 By MIGUEL BUSTILLO Times Staff Writer=20 ?????SACRAMENTO--Republican lawmakers are trying to force Gov. Gray Davis= =20 into a dramatically different exit strategy for the energy crisis: writing= =20 off the $5 billion the state has already spent on electricity and borrowing= =20 billions less to finance future power purchases. ?????GOP lawmakers are holding up emergency legislation needed to replenish= =20 the budget for power costs because they don't think the Democratic=20 governor's plan to get California out of the power business will work. They= =20 say the plan is full of dangerously optimistic assumptions such as estimat= es=20 that 90% of the state's alternative energy producers will be generating=20 electricity this summer--only two-thirds are now--and that Californians wil= l=20 use 7% less electricity. ?????Although Republicans don't control either house the emergency=20 legislation requires a two-thirds vote which gives the GOP significant swa= y. ?????The plan from the Republican leadership would commit taxpayer money fo= r=20 the first time to an electricity problem that has only affected customers o= f=20 private utilities. Because the plan is sure to draw strong opposition from= =20 politicians in Los Angeles and other areas served by public power agencies= =20 Republicans have included a complex $1.5-billion proposal to provide refun= ds=20 to those served by municipal utilities. ?????By blocking the emergency legislation Republicans may stop state=20 Treasurer Phil Angelides from securing a $4.13-billion loan to repay state= =20 coffers for electricity purchases--a failure that would reduce the money=20 available to Davis for his next budget and possibly delay his plan to resol= ve=20 the energy crisis. Angelides needs the bill to guarantee repayment for the= =20 loan. ?????If Angelides does not obtain legislative approval by Monday he will= =20 miss a Tuesday deadline lenders had given him to close the loan. That would= =20 clearly leave Davis with less money for new education police and=20 road-building programs as he begins planning his next budget this month. ?????Moreover failure to pass the bill could delay a record bond issue tha= t=20 Davis promised would replenish the budget and shield it from further energy= =20 drains by summer. And it could harm sagging confidence on Wall Street that= =20 California can deliver on its plans to manage the energy crisis Angelides= =20 said. ?????California's credit rating has already been downgraded by one credit= =20 agency Standard & Poor's largely because of concerns about the effect of= =20 electricity purchases on state finances. ?????Negotiations Are Continuing ?????The Republicans appear to be digging in and playing a dangerous game = of=20 financial roulette with the state. This is really ludicrous to me Angelid= es=20 said. Standard & Poor's has already downgraded us. The other credit rating= =20 agencies are watching. I just don't understand what the Republicans are=20 thinking. ?????Said Assembly Republican leader Dave Cox (R-Fair Oaks): We're not=20 prepared to give the governor a blank check. ?????Democrats threatened Thursday to test the Republicans' resolve by=20 bringing the bill to a vote in the Assembly but backed down. Negotiations= =20 among legislative leaders continue. ?????To avoid widespread blackouts the state government entered the=20 electricity-buying business in January after the private utilities became t= oo=20 burdened with debt to continue purchasing power on the expensive wholesale= =20 market. ?????Under a plan approved by the Legislature and signed into law by Davis= =20 the state budget is to be repaid for the power purchases through a massive= =20 municipal bond issue expected to be the largest in American history. The= =20 bonds in turn are to be paid off by utility ratepayers through a slice of= =20 their monthly bills. ?????However the plan was based on the premise that the state would quickl= y=20 bring down power costs by entering into long-term contracts with suppliers-= -a=20 scenario that has yet to materialize. ?????In fact California's power costs have gone up since January. Lawmaker= s=20 initially estimated that $10 billion in bonds would allow the budget to be= =20 repaid and cover future power purchases. Davis is now proposing $12.5 billi= on=20 in bonds--and higher electric bills--to finance the state's costs until 200= 3. ?????Republicans are convinced that it will not be enough. They say the=20 Angelides bridge loan is not needed because the state has money in various= =20 funds that could cover power purchases well into the fall. ?????They also confess to political considerations. Republican legislators= =20 believe that by allowing Angelides to obtain his loan now they will be=20 powerless to oppose further borrowing later. The loan Angelides set up with= =20 J.P. Morgan Chase and several other financial services companies is to be= =20 repaid with the bond issue. If the loan is not repaid by the end of the=20 summer the interest rate will rise dramatically a situation that would ma= ke=20 it hard for the minority Republicans to oppose more bonds. ?????The strong GOP views were shaped in part by Democratic state Controlle= r=20 Kathleen Connell who met with Republican legislators earlier this week and= =20 shared a highly critical appraisal of Davis' plan. ?????Connell told the Republicans that the governor's strategy was based on= a=20 series of assumptions about electricity market conditions in California thi= s=20 summer that in her view are highly improbable. ?????It is almost impossible for all these hypothetical situations=20 envisioned in their scenario to occur at once Connell said. ?????But even if all the assumptions came to pass she predicted that=20 California would still need to secure another source of financing by next= =20 spring to continue energy purchases. Davis administration officials have=20 rebutted her claim. ?????I am deeply troubled by this incremental approach to this financing= =20 that is long-term in nature and is going to burden the state for many years= =20 Connell said in what appeared to be a reference to Davis' reputation as a= =20 plodder.=20 ?????Using Surplus to Pay for Electricity ?????Republicans who have traditionally been opposed to financing public= =20 programs with large bond issues contend that Davis needs to reevaluate his= =20 plan. By proposing to essentially forget the $5 billion the state has spent= =20 so far on power they are advocating using up the state's projected budget= =20 surplus on electricity costs even if it means cutting new government=20 programs. ?????If Gov. Davis continues down this path he could bankrupt the state= =20 said Assemblyman Dennis Mountjoy (R-Monrovia). That would have a far great= er=20 impact on education. ?????Democrats who strongly believe that the surplus should be invested in= =20 roads schools and to meet other long-term future needs are unlikely to ev= er=20 support the idea. Lawmakers are already discussing outflanking the=20 Republicans by drafting a bill to repay the budget on a nonemergency basis= =20 which would only require a majority vote. ?????That however would probably delay the financing until at least Augus= t=20 since nonemergency measures do not take effect for 90 days--giving Californ= ia=20 only about six weeks to cut the largest municipal bond deal ever before sta= te=20 coffers begin to empty according to Angelides. ?????There is another potential consequence: Many of the long-term contract= s=20 the Davis administration has reached to purchase electricity contain clause= s=20 that may make them void if the state does not obtain financing by July. ?????This is a very dangerous game Angelides said. ?????In other electricity developments Thursday: ?????* Over Republican objections Democrats in the state Senate approved a= nd=20 sent to Davis a far-reaching bill that would put state government in the=20 business of operating its own power plants and selling electricity at cheap= er=20 rates than private companies. The bill SB 6x by Senate leader John Burton= =20 (D-San Francisco) would create a state power authority with the ability to= =20 finance buy own and build generation plants and sell the energy at=20 cost-based rates. ?????on likened the proposed government body to the New York Power Authorit= y=20 approved by GOP Gov. George Pataki which brought about a 10% reduction in= =20 rates. ?????The difference from the current situation is that the people of=20 California the ratepayers would benefit and not the corporate officers a= nd=20 not the shareholders of private energy companies Burton said. ?????But Republicans attacked the power authority as more government that= =20 would impose itself on an enterprise better suited for private operators wi= th=20 years of expertise. ?????This is a horrific mistake and one that California ratepayers will be= =20 paying for many years to come said state Sen. Tom McClintock (R-Thousand= =20 Oaks.) ?????* California Secretary of State Bill Jones a GOP gubernatorial hopefu= l=20 released his plan to address the electricity crisis criticizing Davis'=20 efforts as a state takeover of the power industry. ?????Jones called on the utilities' parent companies to help bail out their= =20 troubled subsidiaries and said creditors should accept lower payments on ba= ck=20 debts. He also called for creation of a state-federal emergency management= =20 plan to deal with any blackouts this summer. Jones made his three-page=20 proposal in a letter to Vice President Dick Cheney head of the Bush=20 administration's energy task force. ---=20 ?????Times staff writers Carl Ingram in Sacramento and Mark Z. Barabak in L= os=20 Angeles contributed to this story. Copyright 2001 Los Angeles Times=20 Secretary of Energy Davis Meet on U.S. Plan to Boost Conservation=20 Crisis: Federal buildings and military bases accounting for 1.5% of state'= s=20 usage will cut back.=20 By RICHARD SIMON and DAN MORAIN Times Staff Writers=20 ?????SACRAMENTO--In a visit meant to underscore the Bush administration's= =20 heightened concern about the California electricity crisis Secretary of=20 Energy Spencer Abraham met Thursday with Gov. Gray Davis in Sacramento to= =20 discuss federal energy conservation plans. ?????I think we have an approach that can result in significant savings= =20 Abraham told Davis. The energy secretary said he was in California to gaug= e=20 what we can do to add to what California is already doing. ?????The trip came after President Bush revealed plans for a series of=20 conservation measures for federal buildings and military bases nationwide.= =20 Those facilities in California account for 1.5% of the state's total energy= =20 use. Today Abraham is scheduled to meet with federal officials in San=20 Francisco to work out details of the nationwide program for more than 5000= 00=20 federal buildings. ?????After meeting with Abraham at the White House earlier Thursday Bush= =20 said: We're worried about blackouts that may occur this summer and we wan= t=20 to be a part of any solutions. This administration is deeply concerned abou= t=20 California and its citizens. ?????Defending his response to the California crisis Bush said As I said= =20 from the very beginning of my administration we'll work to help California= =20 in any way we can. ?????Also Thursday Davis met with alternative energy producers in an attem= pt=20 to persuade them to continue operations despite being owed more than $1=20 billion by California's private utilities. ?????Alternative energy producers including oil companies that generate=20 electricity as a byproduct of their operations account for about 27% of th= e=20 electricity consumed in California. Several have stopped producing after th= e=20 utilities could no long afford to pay soaring prices for their power. ?????Davis assigned S. David Freeman and former Assemblyman Richard Katz a= =20 Davis appointee to a state water board to be in charge of negotiations.=20 Davis said he hoped that the talks could be completed within a week. ?????And in a sign that major energy companies may get more involved in the= =20 California crisis Kenneth Lay CEO of the Houston-based energy giant Enron= =20 Corp. met Thursday with Davis Assembly Speaker Bob Hertzberg (D-Sherman= =20 Oaks) and Senate President Pro Tem John Burton (D-San Francisco). ?????Meanwhile Bush on Thursday directed federal agencies to take=20 appropriate actions to conserve energy use at their facilities. ?????In California such measures could include setting thermostats to 78= =20 degrees lowering lighting and turning off escalators during Stage 2 and=20 Stage 3 power emergencies administration officials said. Those occur when= =20 the state's electricity reserves fall below 5% and 1.5% respectively and= =20 can trigger interruptions in service. ?????Bush did not set an energy-saving target. But the Defense Department= =20 one of the state's single largest energy consumers--using about 1% of peak= =20 demand--pledged to reduce peak use by 10% this summer and an additional 5% = by=20 summer 2002. That would make available 200 megawatts officials said enoug= h=20 to provide electricity to about 150000 homes during the summer. ?????The federal government accounts for about 1.5% of total energy use=20 across the country making it one of the nation's largest energy consumers= =20 according to the Energy Department. ?????Bush also offered to make available to the state power-generating unit= s=20 owned by the federal government. ?????But his efforts failed to mollify Democratic critics who renewed call= s=20 for the administration to impose price controls on wholesale electricity. ?????The generating companies are gouging California consumers while the= =20 president turns his back on us Sen. Barbara Boxer (D-Calif.) said in a=20 statement. ?????Rep. Sam Farr (D-Carmel) leader of the California Democratic=20 congressional delegation sent a letter to Vice President Dick Cheney=20 protesting Democrats' exclusion from Cheney's meeting this week with=20 California GOP lawmakers. ?????As we head into the high summer demand months it is unfortunate that= =20 you have decided to keep Democrats in the dark about the administration's= =20 plans to deal with the crisis Farr said. ?????Bush's conservation initiative comes after Cheney who is heading a ta= sk=20 force on national energy policy was assailed by some critics for emphasizi= ng=20 production over conservation. ?????Conservation has got to be an integral part of making sure we've got = a=20 reasonable energy policy Bush said Thursday. But what the vice president= =20 was saying is we can't conserve our way to energy independence nor can we= =20 conserve our way to having enough energy available. We've got to do both. W= e=20 must conserve but we've also got to find new sources of energy. ?????David M. Nemtzow president of the Alliance to Save Energy called the= =20 directive an emergency answer to a long-term problem. ?????We need to fix the underlying problem by investing in energy-efficien= t=20 lighting cooling and controls he said. We hope that this crisis will=20 encourage the president to increase the budget for energy management rather= =20 than cut it by 48% as previously proposed. ?????Political analysts said the effort was driven by concerns for not only= =20 electrons but also elections. ?????It's all about political conservation said Marshall Wittmann senio= r=20 fellow at the conservative Hudson Institute. ?????Thomas E. Mann senior fellow at the nonpartisan Brookings Institution= =20 agreed: The administration has come to the view that just because they can= 't=20 win California in a presidential election doesn't mean the Republican Party= =20 can afford to kiss off the largest state in the Union. ?????Analysts speculated that the administration came under pressure from= =20 California Republicans in Congress who worried about perceptions that the= =20 White House was not being aggressive enough in responding to the crisis. ?????As federal officials search for ways that California can avoid blackou= ts=20 this summer a Woodland Hills-based advocacy group More Power to You has= =20 suggested that the Navy hook its nuclear-powered ships to the state power= =20 grid to provide energy while in port. ?????The Navy has nuclear-powered aircraft carriers and submarines in San= =20 Diego and Washington state. ?????But Navy officials said it is not technologically feasible to use the= =20 nuclear reactors aboard the ships to provide power for the grid because mos= t=20 of that power goes directly to the propulsion systems. ?????Even to capture power not used for propulsion would require extensiv= e=20 construction on shore and retrofitting aboard ship officials said. Also= =20 using ships to provide onshore power could disrupt training and deployment= =20 schedules they said. ---=20 ?????Times staff writer Tony Perry contributed to this report. Copyright 2001 Los Angeles Times=20 PG&E Seeks Relief From High-Priced Power Purchases=20 Bankruptcy: Utility asks judge to order grid operator to stop buying=20 electricity on its behalf at prices beyond its means.=20 By TIM REITERMAN Times Staff Writer=20 ?????SAN FRANCISCO--Pacific Gas & Electric Co. asked a federal bankruptcy= =20 judge Thursday to order the state's power grid operator to stop buying=20 electricity for its customers on the sky-high spot market unless the utili= ty=20 can recover the full cost. ?????The move represents PG&E's latest attempt in Bankruptcy Court to get= =20 relief from actions that the company says are driving it deeper into debt. ?????PG&E asked Judge Dennis Montali to enjoin the California Independent= =20 System Operator from making the company pay the costs of power purchased on= =20 the utility's behalf. The company said it recently received a $1-billion bi= ll=20 for such purchases in January and February. ?????By purchasing wholesale power at a cost higher than the retail rates= =20 and sending us the bill [Cal-ISO] . . . could be reducing the value of our= =20 assets by hundreds of millions of dollars a month said PG&E spokesman Ron= =20 Low. ?????In its motion the company argued that Cal-ISO is violating bankruptcy= =20 law by requiring the utility to pay more for power than it can collect from= =20 state-regulated rates frozen under California's deregulation plan. PG&E sai= d=20 Cal-ISO's actions would force the utility to seek credit on onerous terms. ?????The motion also contended Cal-ISO is violating an April 6 order by the= =20 Federal Energy Regulatory Commission that said the grid operator could only= =20 buy power on behalf of credit-worthy entities. ?????That same day PG&E sought Chapter 11 protection from creditors sayin= g=20 it was $9 billion in debt. It later filed a motion seeking to halt an=20 accounting change ordered by the California Public Utilities Commission=20 which the company says is prolonging the rate freeze and preventing it from= =20 recouping the cost of power. ?????Elena Schmid Cal-ISO's vice president of corporate and strategic=20 development said she has not seen the motion and could not fully comment. ?????But she said Cal-ISO has been discussing billings with PG&E in hopes o= f=20 determining which payments fall within the FERC ruling and which are subjec= t=20 to the bankruptcy case. ?????We will live by the FERC ruling and whatever constraints the Bankrupt= cy=20 Court places on us Schmid said. We have indicated to them (PG&E) that we= =20 are sending the bill . . . and they should treat it as information until w= e=20 can work it through. ?????PG&E listed Cal-ISO as one of its biggest creditors with $1.1 million= =20 owed for power purchased from third parties. Copyright 2001 Los Angeles Times=20 SDG&E Blackout Plan Would Pay Firms to Use Generators=20 Utilities: Program in which large customers produce their own power is=20 forecast to cut demand by as much as 50 megawatts save $1.6 billion.=20 By NANCY RIVERA BROOKS Times Staff Writer=20 ?????San Diego Gas & Electric unveiled a novel plan Thursday to pay custome= rs=20 to fire up their backup generators when blackouts threaten. ?????The utility said the program could cut demand on the power grid by 50= =20 megawatts--enough to serve about 37500 homes--allowing it to avoid or=20 minimize blackouts this summer in San Diego and southern Orange County. ?????California needs an infusion of new power supplies but in the interi= m=20 we hope this unique program will help shield San Diego from some of the=20 devastating effects of rolling blackouts this summer including the increas= ed=20 risks to public safety and health SDG&E President Debra L. Reed said. ?????The Rolling Blackout Reduction Program as the Sempra Energy subsidiar= y=20 has dubbed it would cost $15 million to implement but could save the regio= n=20 as much as $1.6 billion in lost revenue reduced productivity and property= =20 damage the utility has estimated. ?????Energy experts are forecasting a dark summer for California with=20 blackout totals ranging between 20 hours and 1100 hours. The California=20 Independent System Operator which runs the electricity transmission grid f= or=20 most of the state has said residents face 34 days of rotating outages if= =20 they use the same amount of electricity this summer as they did last summer= . ?????The state and utilities have been working feverishly to develop progra= ms=20 that will reduce electricity use this summer. ?????SDG&E Edison International's Southern California Edison and PG&E=20 Corp.'s Pacific Gas & Electric have programs that grant large customers low= er=20 electricity rates in exchange for cutting electricity use when Cal-ISO=20 declares a Stage 2 emergency as power reserves dip below 5%. But=20 participation in those programs has dropped sharply because of repeated pow= er=20 interruptions. ?????SDG&E's interruptible program represents 49 megawatts of demand hal= f=20 of what it was in October spokesman Ed Van Herik said. ?????The new SDG&E program which must be approved by the California Public= =20 Utilities Commission would kick in whenever Cal-ISO declares a Stage 3=20 emergency indicating that power reserves are down to 1.5% of demand and th= at=20 rolling blackouts are imminent. ?????SDG&E hopes to sign up 50 megawatts of backup generation representing= =20 about 40 large commercial and industrial customers but believes customers= =20 capable of generating a total of 200 megawatts may be eligible for the=20 program Van Herik said. ?????We found a lot of customers are interested in this program he said.= =20 This is an opportunity for San Diego to become involved. ?????During a Stage 3 order program participants would be asked to start= =20 their backup generators and then reduce the electricity they receive from= =20 SDG&E by the same amount. ?????Participants would be paid a monthly fee of $7 per kilowatt of=20 generation capacity. On top of that they would receive 35 cents for every= =20 kilowatt-hour of power they generate for their own use. That price is about= =20 what power plant owners have been commanding in California's pricey=20 electricity market. ?????We think the fees we are proposing are fair Van Herik said. These= =20 aren't people who are in the generation business and undoubtedly there wil= l=20 be wear and tear on equipment and increased personnel and fuel costs. ?????The program which SDG&E wants to implement by June 1 would operate i= n=20 compliance with air pollution regulations the utility said. Copyright 2001 Los Angeles Times=20 Been there done that=20 Bay Area finds little new in Bush's ideas=20 Joe Garofoli Bob Egelko Matthew Yi Chronicle Staff Writers Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 Californians who have been sweating for months to cut their home energy usa= ge=20 20 percent didn't blink yesterday at President Bush's suggestion that feder= al=20 offices conserve half that much.=20 Sure some might nod off at their desks this summer when thermostats at=20 federal buildings will be set at 78 degrees during power shortages. And som= e=20 will get an aerobic workout when the escalators at those same buildings ar= e=20 turned off.=20 But civilians and federal employees alike yawned at yesterday's conservatio= n=20 suggestions such as unplug unused coffee pots after doing everything shor= t=20 of burning their shoelaces for wattage during the past few months.=20 Conservation tips are so December to any Californian worth his baseline.=20 I don't think it's frustrating to (us) because most people know what's goi= ng=20 on that we're in an energy crisis said Ansara Johnson 40 revenue offic= er=20 at the Internal Revenue Service in Oakland.=20 The Bush administration may be setting the pace in the moving-stair=20 department however. BART whose escalators don't run so great in the best = of=20 times said yesterday it is looking at operating escalators with an automat= ic=20 stop-start system to save power this summer. The escalators would be dorman= t=20 until passengers activated them.=20 It is kind of ironic considering we just spent $20 million to fix the=20 escalators BART spokesman Ron Rodriguez said.=20 Just don't turn them off during peak hours Ingrid Severson pleaded while= =20 pulling her massage chair onto an escalator at the 12th Street BART station= =20 in downtown Oakland.=20 That would suck said the 23-year-old massage therapist. There are certa= in=20 things that shouldn't be sacrificed.=20 San Francisco International Airport already is turning off escalators durin= g=20 down times though the long long moving sidewalks are going to keep going = no=20 matter what spokesman Ron Wilson said.=20 Those with customers to serve however embraced the Bush energy plan as=20 warmly as a meter-reader.=20 While federal employees will be working up a sweat this summer hiking up=20 stairs to work shoppers at Concord's Sunvalley Mall will be coolly cruisin= g=20 down the moving stairs to Victoria's Secret.=20 We have no plans to shut down our escalators said Sunvalley general=20 manager Tom McCracken. How else would people get from floor to floor?=20 FASHION VICTIMS The new guidelines could have an unintended effect. They may provoke a=20 fashion revolution among federal employees not a group traditionally known= =20 for its couture choices.=20 It's not their fault. There's only so much you can do with postal blue or= =20 judicial black. But with Bush's directive that thermostats be set at 78=20 degrees many employees said something has to change. Like their wardrobes= .=20 Start with the long-suffering post office sales associates -- the clerks=20 behind the counter -- whom government regulations have shackled in long woo= l-=20 blend pants.=20 I still have not heard a clear-cut reason why we're not allowed to wear=20 shorts and the mail carriers are said Steve Wellington a postal sales=20 associate in Concord. The former postal union leader said the=20 shorts-vs.-pants debate has been a hot one for a long time.=20 Look at these pants Wellington said offering a visitor a touch of his= =20 trousers. These get real warm in the summer.=20 While postal officials were happy to point out that their San Francisco=20 offices have used 17 percent less electricity than last year they wouldn't= =20 touch the shorts issue. I don't think we need to comment on that said=20 Horace Hinshaw a spokesman for the U.S. Postal Service.=20 JUDGES GET EXEMPTION Then there are judges. Attorneys and court employees said the bench needs t= o=20 take the lead in the casual attire revolution. Ditch those heavy black robe= s=20 in favor of say a black polo shirt.=20 Black really magnifies the heat said Napa attorney Paul Carey. They=20 should allow judges to wear lighter colors like yellow or chartreuse. If t= he=20 judges would allow it every attorney I know would love to wear a T-shirt= =20 shorts and sandals into court.=20 However there was one indication that judges may be thermostat-exempt at= =20 least at the Phillip Burton Federal Building a 20-story tower at 450 Golde= n=20 Gate Ave. in San Francisco that houses federal courts and numerous agencies= .=20 A contractor who was working yesterday to install new thermostat controls i= n=20 the building said two areas were excluded: computer rooms to protect the= =20 equipment and courtrooms.=20 That was the mandate said Erik Ahrens vice president of Syserco which= =20 has a contract for heating and vent control. Courtrooms are on separate=20 units. =20 At the Ronald V. Dellums Federal Building in downtown Oakland lights alrea= dy=20 have been dimmed in hallways and workers have been encouraged to turn off= =20 unneeded lights and computers since early this year. Cynthia Mackey 38 a= =20 revenue officer for the Internal Revenue Service wasn't happy to hear the= =20 thermostat would be going up.=20 Oh no. I guess I'll just work at home where Mackey said the thermostat = is=20 set at 68 degrees. If it's set at 78 and with all the employees and all t= he=20 computers it would be hot.=20 Then it will be time to change -- habits and clothes.=20 E-mail the reporters at jgarofoli@sfchronicle.com begelko@sfchronicle.com = or=20 myi@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 Bush calls power supply the solution=20 He says conservation useful but secondary=20 Marc Sandalow Washington Bureau Chief Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 Even as he ordered a new conservation effort in California President Bush= =20 insisted yesterday that finding new sources of energy -- not cutting back o= n=20 consumption -- is the long-term answer to the nation's energy woes.=20 You cannot conserve your way to energy independence Bush said. We can d= o=20 a better job in conservation but we darn sure have to do a better job of= =20 finding more supply.=20 Bush's comments his most extensive to date on California's energy crisis= =20 called on all federal managers to conserve energy to the maximum extent=20 consistent with the effective discharge of public responsibilities.=20 As part of that effort the Defense Department -- one of California's large= st=20 consumers of energy -- announced plans to curtail electrical use by at leas= t=20 10 percent by this summer.=20 This administration is deeply concerned about California and its citizens= =20 Bush said after a meeting with his top energy advisers. We're worried abou= t=20 blackouts that may occur this summer and we want to be a part of any=20 solution. =20 While touting the value of conservation Bush repeatedly identified the=20 limits to that approach. In response to questions from reporters Bush made= =20 clear that he would not be confused with former President Jimmy Carter who= =20 donned a cardigan sweater and preached the virtues of conservation two=20 decades ago.=20 It is naive for the American people and its leaders . . . to say that we c= an=20 be OK from an energy perspective by only focusing on conservation Bush=20 said. We've got to find additional supplies of energy.=20 Bush has called for oil drilling in Alaska as well as exploratory drilling= =20 in other parts of the West. Members of his administration also have touted= =20 the expanded use of coal and have floated the idea of building new nuclear= =20 power plants.=20 SUPPLY-SIDE PLAN There have been repeated signals that the comprehensive energy plan being= =20 developed by a White House task force -- which is expected to be released i= n=20 two weeks -- will focus less on conservation than on boosting energy=20 supplies.=20 Energy Secretary Spencer Abraham speaking to reporters after meeting with= =20 the president said conservation plays an important role in helping=20 California through its immediate crisis. Yet developing new sources of ener= gy=20 is important to prevent the rest of the nation from experiencing California= 's=20 shortages.=20 We have a crisis and an emergency this summer (in California) that will=20 result in 30 to 35 days of blackouts Abraham said from the White House=20 driveway. We don't have the time between now and those occasions to develo= p=20 new (energy) sources sufficient to meet the challenge.=20 By the middle of the month the White House will release a national energy= =20 plan that will be more comprehensive and more far reaching that will offer= a=20 new vision that addresses Americans long-term supply security Abraham sai= d.=20 MEETING WITH DAVIS The energy secretary traveled to Sacramento last night where he planned to= =20 meet with Gov. Gray Davis and other state officials. He is scheduled to hol= d=20 a public conservation event this morning in San Francisco and to discuss wi= th=20 federal officials how they can reduce energy consumption.=20 An action plan distributed by the Department of Energy calls for federal=20 workers across the country to develop conservation plans within the next 30= =20 days.=20 In addition it calls for specific actions during Stage 2 or Stage 3 power= =20 emergencies when supplies are within 5 percent of demand. Some experts war= n=20 that California will be in such a state for much of the summer.=20 Among the steps called for in an energy emergency are setting thermostats i= n=20 federal buildings no lower than 78 degrees turning off escalators and=20 hallway lights and unplugging coffee pots computers and any nonessential= =20 appliances.=20 The plan suggests that employees be notified when temperatures might be war= m=20 so they can wear more casual clothing to make the heat more bearable.=20 Meanwhile the Pentagon announced it will reduce its consumption during pea= k=20 demand hours by 10 percent and perhaps by as much as 15 percent by next=20 summer. It will also hook up wind generation facilities at Edwards Air Forc= e=20 Base.=20 Paul Wolfowitz deputy secretary of defense said the steps will save the= =20 state's power grid about 200 megawatts of power enough electricity for 200= =20 000 homes.=20 Energy officials have explored many options including the use of nuclear= =20 submarines to provide energy during shortages and firing up the generators = on=20 the Navy's mothball fleet in Suisun Bay near Benicia. Both ideas have been= =20 rejected as unfeasible energy officials said.=20 Democrats cheered Bush's call for conservation though several said it did= =20 not go far enough.=20 IRONIC PRAISE I am very happy the president and Secretary Abraham recognized that=20 conservation matters said Richard Sklar Gov. Davis' top energy adviser.= =20 We thank the president for catching up with the train.=20 Republican governors meeting in San Jose suggested that Davis could do more= =20 on his own and in concert with other Western states to help California ease= =20 its energy crunch.=20 It's time Montana Gov. Judy Martz argued that California met its=20 responsibility to build an adequate power supply and stop looking to=20 Washington for a bailout.=20 Others however called on Bush to go further and impose price caps on=20 wholesale electricity prices to guarantee a steady flow of electricity and= =20 keep prices down for consumers.=20 Chronicle staff writers Lynda Gledhill and Bill Workman contributed to this= =20 report. / E-mail Marc Sandalow at msandalow@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 SDG&E unveils plan to contend with rolling blackouts=20 Friday May 4 2001=20 2001 Associated Press=20 URL:=20 tate0 957EDT0155.DTL&type=3Dnews=20 (05-04) 06:57 PDT SAN DIEGO (AP) -- San Diego Gas & Electric has unveiled a= =20 plan that would pay customers who fire up their emergency generators when= =20 rolling blackouts loom.=20 The utility is seeking approval from the state Public Utilities Commission = to=20 place about 40 companies under contract to generate a total of 50 megawatts= =20 during statewide power alerts. The backup power would be enough to serve=20 about 37500 homes.=20 ``These businesses would actually be sharing their backup generation with t= he=20 San Diego region'' Debra Reed president of SDG&E said Thursday.=20 The Rolling Blackout Reduction Program would cost the utility an estimated= =20 $15 million to implement but could save the regions as much as $1.6 billio= n=20 in lost revenue property damage and reduced productivity caused by=20 blackouts utility officials said.=20 The California Independent System Operator which manages the transmission= =20 grid for most of the state has estimated that residents face up to 200 hou= rs=20 of blackouts over 30 to 35 days this summer due to high demand and=20 insufficient energy supplies.=20 The use of emergency generators will lead to more air pollution but Reed= =20 said the ``social benefit'' of the trade-off would be worth it because=20 residents and businesses would not have to deal with the safety risks and= =20 hazards of blackouts.=20 SDG&E officials want the Public Utilities Commission to act on its request= =20 within a week and hope to have the program in effect by June 1.=20 The program would go into effect whenever Cal-ISO declares a Stage 3=20 emergency which indicates that power reserves are down to 1.5 percent and= =20 rolling blackouts are imminent. Program participants would be asked to star= t=20 their emergency generators and then reduce the electricity they receive fro= m=20 SDG&E by the same amount.=20 Participants would be paid a monthly fee of $7 per kilowatt of generation= =20 capacity plus receive an additional 35 cents for every kilowatt-hour of=20 power generated for their own use.=20 ``We think the fees we are proposing are fair'' said SDG&E spokesman Ed Va= n=20 Herik. ``These aren't people who are in the generation business and=20 undoubtedly there will be wear and tear on equipment and increased personne= l=20 and fuel costs.''=20 2001 Associated Press ?=20 California crisis brings new talk of energy conservation.=20 DEB RIECHMANN Associated Press Writer Friday May 4 2001=20 2001 Associated Press=20 URL:=20 tate0 945EDT0153.DTL&type=3Dnews=20 (05-04) 06:45 PDT WASHINGTON (AP) -- In the 1970s energy conservation was= =20 Jimmy Carter in a cardigan telling people to bundle up and turn down the=20 heat. Today it's about using energy-efficient fluorescent bulbs=20 computerized thermostats and motion sensors.=20 To many Americans California's energy crisis is a problem isolated on the= =20 West Coast. Yet it has resurrected interest in conservation that hasn't bee= n=20 heard since gas lines and the OPEC oil embargo more than two decades ago.= =20 President Bush on Thursday ordered federal agencies to cut power use in=20 California where rolling blackouts have catapulted the debate over future= =20 energy supplies to the top of the national agenda.=20 Bush's conservation message came just days after Vice President Dick Cheney= =20 who claims the whole nation could face blackouts like those in California= =20 unless it finds more oil natural gas and coal said America cannot ``simpl= y=20 conserve or ration our way out of the situation we're in.''=20 Environmentalists maintain the Bush administration is using California's=20 electricity crisis -- largely due to a failed attempt at electricity=20 deregulation -- to push through a broader energy plan to drill for oil and= =20 natural gas in now off-limits areas of Alaska and the West. Hardly any powe= r=20 plants run on oil they note.=20 And energy-conservation groups say if everybody made better use of the ener= gy=20 already being generated America would not need many of the 1300-plus powe= r=20 plants that Bush and Cheney say demand will require over the next 20 years.= =20 Nobody will have to sit in the dark they say if it were made easier for= =20 Americans to use less energy through more fuel efficient light bulbs motor= s=20 automobiles office buildings and homes.=20 ``In today's world we are not asking people to not use their (air=20 conditioning) -- that is not today's message of conservation'' said Rozann= e=20 Weissman a spokeswoman for the Alliance to Save Energy a Washington-based= =20 nonprofit group. ``What we need to do is look at using our energy more=20 efficiently and using today's technologies to help do it for us.''=20 According to the alliance:=20 --If each household in the United States replaced four regular 100-watt bul= bs=20 with energy-efficient compact fluorescent bulbs the output of 30=20 medium-sized power plants (each with a 300-megawatt capacity) would not be= =20 needed.=20 --If the Bush administration's new efficiency standards for air conditioner= s=20 and heat pumps improved energy use by 30 percent instead of 20 percent the= =20 output of 138 of these power plants would not been needed during peak use= =20 times.=20 Americans could even unplug idle appliances -- TVs VCRs cable boxes CD= =20 players and microwaves -- when they go out of town. Some of these appliance= s=20 continue to consume energy when switched off. The power keeps display clock= s=20 lighted and memory chips and remote controls working. The alliance says the= se=20 electric leaks cost consumers more than $3 billion a year.=20 Conservation does help according to Alexandra von Meier director of the= =20 Environmental Technology Center at Sonoma State University in California. S= he=20 told a House energy subcommittee on Thursday that residential and commercia= l=20 buildings use about 35 percent of the energy -- electricity and fuels -- in= =20 the United States.=20 ``This amount of energy can be cut in half if not more by implementing th= e=20 things we already know about how to make buildings more energy efficient an= d=20 at the same time more comfortable'' she said explaining how Venetian=20 blinds hung on the outside of the technology center keeps the glass from=20 transferring heat.=20 Howard Geller former executive director of the American Council for an=20 Energy Efficient Economy told the committee about an Energy Department stu= dy=20 in November 2000 that said increasing energy efficiency throughout the=20 economy could cut national energy use by at least 10 percent by 2010 and by= =20 20 percent in 2020.=20 ``Even though the United States is much more energy-efficient today than it= =20 was 25 years ago there is still enormous potential for additional=20 cost-effective energy savings'' said Geller.=20 Associated Press reporter H. Josef Hebert contributed to this report.=20 2001 Associated Press ?=20 Developments in California's energy crisis=20 The Associated Press Friday May 4 2001=20 2001 Associated Press=20 URL:=20 tate0 410EDT0127.DTL&type=3Dnews=20 -- (05-04) 01:10 PDT Developments in California's energy crisis:=20 FRIDAY:< ?--No power stage alerts are reported as of early Friday morning. = ?THURSDAY:<=20 -- Gov. Gray Davis meets with representatives of the qualifying facilities = in=20 Sacramento to discuss their concerns and the possibility of getting their= =20 plants online during all peak periods.=20 -- The state Senate sends a bill to the governor that would create a state= =20 public power authority. Supporters say the bill will ease the energy crisis= =20 by allowing the state to build and buy power plants that could provide=20 cheaper wholesale electricity.=20 -- State Treasurer Phil Angelides says Assembly Republicans are ``holding= =20 their own state hostage'' by not approving a bill to authorize up to $12.5= =20 billion in bonds for power purchases. Republicans put their own plan forwar= d=20 Wednesday saying they'd rather use $5 billion of the state's surplus and= =20 finance less.=20 -- Energy Secretary Spencer Abraham travels to the Capitol to discuss the= =20 state's power woes with Davis. Abraham meets with state Republican leaders = in=20 San Francisco following the meeting with the governor.=20 -- The new special counsel to the Senate Select Committee to Investigate=20 Price Manipulation of the Wholesale Energy Market says ``it is likely there= =20 was some criminal activity'' in driving up electricity prices. Laurence=20 Drivon a private plaintiff's attorney from Stockton will work for the=20 committee for free spending about four days a week on the job initially. H= is=20 review of thousands of power-related documents leads him to believe there w= as=20 criminal collusion he would not elaborate.=20 -- The San Joaquin County District Attorney is joining the Senate Select=20 Committee in its power investigation. Supervising Deputy District Attorney= =20 Franklin Stephenson says three experienced investigators will help the=20 committee decide if there was illegal price-fixing antitrust violations o= r=20 theft of public funds by public or private electric generators.=20 -- Pacific Gas and Electric Co. asks a federal bankruptcy judge to stop the= =20 state's power grid manager from charging the utility for expensive=20 last-minute electricity. PG&E has applied for bankruptcy protection and say= s=20 that the ISO's bills ``could be reducing the value of the company's assets = by=20 potentially hundreds of millions of dollars per month.''=20 -- Secretary of State Bill Jones a Republican candidate for governor=20 proposes a utility rescue plan that would take the state out of the=20 electricity business. The plan calls for utility creditors to accept=20 less-than-full payments more cash flow from the utilities' parent companie= s=20 and low-interest state loans to help the utilities pay off their debts.=20 -- The California Association of Health Care Facilities says it expects the= =20 state Public Utilities Commission to exempt nursing homes from blackouts. T= he=20 group says many nursing home residents depend on electric life support=20 machines. A PUC decision is expected by May 14.=20 -- The California Immigrant Welfare Collaborative said they are worried tha= t=20 state's power purchases could threaten two assistance programs that pay for= =20 food stamps and cash benefits. The programs which help recent immigrants= =20 expire Sept. 30 unless they get renewed during budget negotiations.=20 -- The state auditor will look into the California Energy Commission's=20 process for siting new power plants and allowing defunct plants to return t= o=20 service. The audit was requested by Assemblyman Jay La Suer R-La Mesa and= =20 is expected in August.=20 -- Edison International stock closes at $9.28 down 9 cents. PG&E Corp.=20 dropped 10 cents to close at $8.86.=20 -- The state remains free of power alerts as electricity reserves stay abov= e=20 7 percent.=20 WHAT'S NEXT:< -- The governor meets Wednesday with the CEOs of several major energy=20 suppliers to discuss the money their owed by the state's two largest=20 utilities the state's creditworthiness and how wholesalers can help the=20 state during the energy crisis. Davis says he won't be discussing any of th= e=20 investigations into price manipulation in the wholesale market.=20 -- Davis' representatives continue negotiating with Sempra the parent=20 company of San Diego Gas and Electric Co. to buy the utility's transmissio= n=20 lines.=20 THE PROBLEM:< High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Edison and PG&E say they've lost nearly $14 billion since June to high=20 wholesale prices the state's electricity deregulation law bars them from=20 passing on to consumers. PG&E saying it hasn't received the help it needs= =20 from regulators or state lawmakers filed for federal bankruptcy protection= =20 April 6.=20 Electricity and natural gas suppliers scared off by the two companies' poo= r=20 credit ratings are refusing to sell to them leading the state in January = to=20 start buying power for the utilities' nearly 9 million residential and=20 business customers. The state is also buying power for a third investor-own= ed=20 utility San Diego Gas & Electric which is in better financial shape than= =20 much larger Edison and PG&E but also struggling with high wholesale power= =20 costs.=20 The Public Utilities Commission has raised rates as much as 46 percent to= =20 help finance the state's multibillion-dollar power buys.=20 2001 Associated Press ?=20 Energy at a glance=20 Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N225908.DTL&type=3Dnews=20 In other energy-related developments yesterday:=20 STATE POWER AUTHORITY On a partisan vote the Legislature sent Gov. Davis a bill creating a state= =20 public power authority that can sell as much as $5 billion in bonds to buil= d=20 or buy power plants beef up conservation and renewable energy programs and= =20 retrofit older plants to make them less polluting. Davis is expected to sig= n=20 the bill by state Senate President Pro Tem John Burton D-San Francisco ne= xt=20 week.=20 STATE SENATE INVESTIGATION A special Senate committee investigating allegations of antitrust violation= s=20 and price-fixing by electricity generators announced that Larry Drivon a= =20 Stockton trial lawyer would serve as the committee's general counsel. Driv= on=20 said that from documents he has seen there is some indication there very= =20 well may have been criminal aspects to this.=20 PG&E COMPLAINTS PG&E usually the target of complaints about electricity bills made its ow= n=20 gripe about high bills to a federal bankruptcy judge yesterday. PG&E said t= he=20 California Independent System Operator which manages the state's power gri= d=20 charged the utility nearly $1 billion for power that the ISO bought above= =20 retail prices in January and February and reduced the assets available in= =20 bankruptcy. The company asked the judge to tell the ISO to back off. ISO=20 spokeswoman Lorie O'Donnelly said her agency has stopped buying power for= =20 PG&E -- a task now handled by the state -- and will await the outcome of th= e=20 bankruptcy proceedings to see how much of its bill it can collect.=20 ALTERNATIVE ENERGY Gov. Davis met with producers of alternative energy such as solar panels a= nd=20 wind farms a third of whom have shuttered their operations because the=20 utilities they have contracts with have paid them pennies on the dollar sin= ce=20 November. The generators going offline have contributed to recent rolling= =20 blackouts. Davis said the meeting's purpose was to resolve any remaining=20 disputes between the energy producers and the utilities so more electricity= =20 can be produced this summer. The participants said they made progress and= =20 agreed to meet again next week.=20 2001 San Francisco Chronicle ? Page?A - 17=20 Ships would help during blackouts=20 Ready reserve fleet has power to provide=20 Carl Nolte Chronicle Staff Writer Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N182291.DTL&type=3Dnews=20 San Francisco -- A fleet of 13 gray government cargo ships tied up on the S= an=20 Francisco waterfront and at Alameda is ready and able to provide emergency= =20 electric power if rolling blackouts hit this summer.=20 We'd be more than willing to help said Capt. Frank Johnston Western=20 region administrator for the U.S. Maritime Administration which manages th= e=20 ships. The vessels are part of the country's ready reserve fleet have crew= s=20 aboard 24 hours a day and are prepared to sail anywhere in the world on fiv= e=20 days' notice.=20 The offer comes a day after the Bush administration suggested using ships i= n=20 the so-called mothball fleet in Suisun Bay near Benicia to provide power.= =20 However the officer in charge of the old ships there said yesterday he=20 thought his vessels could not make much of a contribution.=20 Nobody has contacted us about that said Joseph Pecoraro superintendent = of=20 the reserve fleet.=20 Unlike the ready reserve ships the mothball vessels are neither modern nor= =20 set to sail anytime soon.=20 Pecoraro said the equipment on most of the ships has not been used in years= .=20 To use them to supply civilian power he said is not real simple.=20 It's feasible he said but probably not practical.=20 On the other hand using the ready reserve ships also has some drawbacks --= =20 crewing the ships paying for fuel and more seriously the amount of=20 pollution produced by running the ship's diesel generators.=20 Johnston said the ships meet Environmental Protection Agency standards but= =20 some environmental activists have grave misgivings. Nothing could be a=20 bigger disaster for air quality said Russell Long executive director of= =20 the Bluewater Network in San Francisco which has been highly critical of a= ir=20 pollution caused by marine engines. These are very highly polluting engine= s.=20 They produce a hundred times more pollution per kilowatt hour than modern= =20 generators he said.=20 Long says EPA standards for ships are pathetic.=20 Ships are the worst polluters on the planet.=20 Several of the ready reserve ships are in highly visible berths in San=20 Francisco. One of them the cargo ship Cape Henry is at Pier 27 at the foo= t=20 of Telegraph Hill and another the Cape Orlando is at Pier 50 on the=20 southern waterfront not far from Pacific Bell Park. The ship is visible fr= om=20 the stands and is a kind of floating backdrop to the right-field wall.=20 Nine of the ships are tied up at the former Alameda Naval Air Station but= =20 any or all of them could be easily moved.=20 The ships have civilian crews but are often confused with Navy ships becau= se=20 they are painted battleship gray. They are intended for use in time of=20 international crisis or other incident.=20 All of them have the capacity to generate electricity. Johnston said he was= =20 not sure exactly how much power his ships could supply but it would be=20 enough for emergency services.=20 We could supply fire stations or police stations or hospitals or the 91= 1=20 network he said. There are all kinds of possibilities and we are more th= an=20 willing to consider any proposal Johnston said.=20 It is better to plan now than to wait until the power goes out and then wo= rk=20 by flashlight he said.=20 Johnston said he did not have the authority to conclude an agreement with= =20 local officials himself but he would be glad to run a plan up the flagpol= e=20 in Washington.=20 Power from ships has been used in the past in emergency situations. Many=20 years ago said Capt. Patrick Moloney executive director of the California= =20 Pilot Commission power from the aircraft carrier Saratoga was used to supp= ly=20 the city of Tacoma Wa. during an emergency.=20 However he said because of the complexity of connecting ship's power with= =20 the civilian grid such applications are rare. It is a nice idea he said= =20 but ships are not configured for it.=20 E-mail Carl Nolte at cnolte@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 19=20 PG&E chairman wants to keep power lines=20 David Lazarus Chronicle Staff Writer Friday May 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/B U162707.DTL&type=3Dnews=20 Pacific Gas and Electric Co. may be more amenable to selling off its dams= =20 rather than its power lines if required to part with assets as part of the= =20 utility's bankruptcy proceedings PG&E Chairman Robert Glynn said yesterday= .=20 In a meeting with Chronicle editors and writers Glynn stressed that he sti= ll=20 hopes to get through the bankruptcy process without selling any of PG&E's= =20 resources to pay off creditors.=20 But if there is an asset to be sold it's not clear that the power lines i= s=20 it he said. Our hydro assets actually have a higher value.=20 Glynn's comments may signal challenges down the road for Gov. Gray Davis'= =20 efforts to acquire the transmission systems of all three of California's=20 investor-owned utilities.=20 Southern California Edison already has agreed to sell its lines to the stat= e=20 for $2.7 billion. A similar accord is expected to be reached with San Diego= =20 Gas & Electric.=20 However critics have said Davis would be purchasing a white elephant if he= =20 manages to buy only about a third of the statewide electricity grid. Withou= t=20 PG&E's lines the Edison and San Diego systems would be of lesser value.=20 Glynn noted that he had tentatively agreed to sell off PG&E's power lines f= or=20 an undisclosed sum before the utility's negotiations with the state collaps= ed=20 in March.=20 But I've said pretty clearly that I don't want to sell off any part of our= =20 business he said.=20 Glynn defended his decision to file for bankruptcy by saying it was the mos= t=20 efficient way to restore cash-strapped PG&E to credit-worthiness. The utili= ty=20 has racked up about $9 billion in debt because of runaway wholesale power= =20 prices.=20 The company's got to be able to pay its bills Glynn said. We expect to= =20 pay all of our valid debts.=20 He said PG&E will submit a proposed reorganization plan to the bankruptcy= =20 court in San Francisco by early August. That plan may include aspects of th= e=20 bailout accord reached between Davis and Edison.=20 If an element of it makes sense for us we would be comfortable including= =20 it Glynn said.=20 He said it appears likely that an average 40 percent rate increase already= =20 approved by state regulators will cover current energy purchases and that n= o=20 further rate hikes may be required.=20 Under this plan the current average monthly PG&E electricity bill of $60= =20 will rise by about $18.=20 However Glynn said the need for higher power bills will not be clear until= =20 the Public Utilities Commission decides how it will divide existing rates= =20 between PG&E and the state Department of Water Resources which is spending= =20 about $50 million a day to keep California's lights on.=20 If the state wants to take all the money then a solution does not exist= =20 he said.=20 Glynn said that despite recent progress in getting Californians to conserve= =20 energy he believes the only way the state will solve its long-term power= =20 woes will be to build more generating facilities.=20 It is my personal belief that it's not possible to conserve our way back t= o=20 a stable supply-and-demand balance he said. We've got to get back to the= =20 point where we have enough supply to meet demand every day of the year.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?B - 1=20 Bush shifts policy on conservation after meeting with GOP=20 Posted at 10:06 p.m. PDT Thursday May 3 2001=20 BY JIM PUZZANGHERA=20 Mercury News Washington Bureau=20 WASHINGTON -- On Monday Vice President Dick Cheney used a major speech to= =20 largely dismiss energy conservation as an outdated notion from the 1970s. O= n=20 Thursday President George W. Bush announced a major initiative to force=20 federal facilities in California and nationwide to conserve energy to try t= o=20 avoid blackouts.=20 What happened in those three days?=20 The impetus for the shift appears to have been a one-hour meeting Tuesday= =20 between Cheney and 18 Republican members of Congress from California on=20 Capitol Hill.=20 An energy conservation plan for federal agencies was brought up by=20 congressional Republicans according to two participants. And the political= =20 ramifications on the party of appearing to do nothing to ease the crisis we= re=20 discussed . No Democrats were invited even though they outnumber Republica= ns=20 in the state's congressional delegation 32 to 20 and the meeting was suppos= ed=20 to look at federal help for the California crisis.=20 Some California Republicans have been griping that the White House has not= =20 been showing enough concern for the state as it continues to struggle throu= gh=20 its energy crisis. Bush who lost California by 1.3 million votes in=20 November and top members of his administration have consistently stressed= =20 that the crisis is largely California's to solve.=20 ``I think there was a need for the administration to begin to weigh in on= =20 this thing especially because there's been so much finger-pointing. Democra= ts=20 have been trying to divert the real blame away from'' Gov. Gray Davis said= =20 Rep. George Radanovich R-Fresno who attended the meeting. ``I mentioned t= o=20 the vice president that politically speaking we don't want that to happen. = We=20 want the blame to rest where it deserves to rest with the governor. And th= ey=20 need to be concerned about that for politics in California.''=20 Damage control=20 Democrats like Rep. Sam Farr D-Salinas said Thursday it's obvious the=20 White House got the message and the conservation plan is an attempt at dama= ge=20 control.=20 The president is ``worried the blackouts may be known as the `Bush Blackout= s'=20 and he wants them to be known as the `Davis Blackouts'? '' said Farr head= =20 of the state's Democratic congressional delegation. He wrote to Cheney on= =20 Thursday expressing ``extreme disappointment'' that the vice president had= =20 excluded Democrats from the Tuesday meeting. Despite several requests Farr= =20 and his Democratic colleagues have yet to meet with Cheney or any other top= =20 administration officials on the issue.=20 Bush on Thursday denied there was any change in policy.=20 ``What the vice president and I understand is that you cannot conserve your= =20 way to energy independence'' Bush said Thursday after meeting with Energy= =20 Secretary Spencer Abraham and Deputy Defense Secretary Paul Wolfowitz. ``We= =20 can do a better job in conservation but we darn sure have to do a better j= ob=20 of finding more supply.''=20 A task force headed by Cheney is finalizing a national energy plan that is= =20 expected to put is major emphasis on increasing supply through more drillin= g=20 for oil and natural gas and greater use of coal and nuclear power.=20 Bush emphasized that ``this administration is deeply concerned about=20 California and its citizens'' as he instructed federal agencies to reduce= =20 their energy usage during Stage 2 or 3 power emergencies in California. The= =20 directive will extend to other states that find themselves facing blackouts= =20 this summer such as those in the Pacific Northwest and the Northeast.=20 Steps to conserve=20 Among the measures administration officials said will be turning up=20 thermostats to 78 degrees darkening interior hallways and pre-cooling=20 buildings at night. Wolfowitz said the Defense Department expected to reduc= e=20 its usage in California by 10 percent over last year and plans to hook up a= n=20 idle wind-powered generating facility at Edwards Air Force Base. All told= =20 the Defense Department hopes to make about 200 megawatts of power available= =20 to the state this summer through reduced usage and added generation.=20 The presidential directive follows one issued by former President Clinton= =20 late last year to federal facilities in California and the Pacific Northwes= t=20 to conserve energy. The Bush administration said its move was more extensiv= e=20 because it directs all facilities nationwide to conserve and requires=20 agencies to report back their actions within 30 days.=20 Rep. Dana Rohrabacher R-Huntington Beach said he and others at Tuesday's= =20 meeting urged that Bush travel to California. Bush has yet to visit the sta= te=20 despite traveling extensively through the country during his first three=20 months.=20 ``We suggested the president come out the vice president come out and any= =20 members of the administration come out so that the people know we're=20 engaged'' Rohrabacher said.=20 California clearly was the main impetus for the Bush directive and the=20 president dispatched Abraham to California on Thursday to discuss the plan= =20 with Davis and the regional heads of federal agencies. Dan Schnur a=20 Republican consultant said that was a good move for the White House.=20 ``Substantively the Bush administration has been doing the right things b= ut=20 because they haven't been out here making their case in person it makes it= =20 much tougher for their case to be heard.'' Schnur said. ``After the=20 Northridge earthquake Clinton had half his Cabinet out here. None of them= =20 had anything official to do but you couldn't turn around without seeing on= e=20 of them on local television talking about Clinton's commitment to rebuildin= g=20 after the earthquake.''=20 Abraham said the White House has responded to nearly every request the stat= e=20 made regarding the electricity crisis. But the administration has not=20 delivered the regionwide caps on electricity prices officials from Californ= ia=20 and the Pacific Northwest have pressed for.=20 The administration even looked into bringing nuclear submarines or aircraft= =20 carriers to the California coast and hooking up their generators to the=20 state's electricity grid. The idea was scrapped after federal officials=20 realized only a small amount of power could be supplied and that safety=20 issues could not be overcome Abraham said.=20 Contact Jim Puzzanghera at (202) 383-6043 or at jpuzzanghera@krwashington.c= om Senate plans public power=20 Published Friday May 4 2001 in the San Jose Mercury News=20 BY AUDREY COOPER=20 Associated Press=20 SACRAMENTO -- California is poised to enter the power business after the=20 state Senate on Thursday approved creation of a public power authority and= =20 sent its bill to Gov. Gray Davis.=20 A power authority supporters said will give the state more control over i= ts=20 wholesale electricity market by building and operating its own power plants= .=20 State-owned plants could charge lower prices and building new plants could= =20 increase supply and ease wholesale prices.=20 If signed by Davis the bill would create a California Consumer Power and= =20 Conservation Financing Authority that could issue up to $5 billion in reven= ue=20 bonds to pay for power plants natural gas storage and additional pipelines= =20 and conservation programs.=20 Also Thursday state Treasurer Phil Angelides blasted a Republican plan to= =20 use $5 billion of the state's surplus toward buying power rather than=20 financing the entire amount with $12.5 billion in bonds.=20 Lawmakers ``are playing a dangerous game of financial roulette putting in= =20 jeopardy the state's fiscal integrity and solvency'' Angelides said.=20 Angelides has been pushing the Legislature to pass a bill that spells out a= =20 limit on the bonds by May 8. The bonds must be approved by then so the stat= e=20 can get a bridge loan to replenish the state's general fund until the bonds= =20 are sold.=20 In a letter to Assembly Speaker Robert Hertzberg late Wednesday the=20 Republicans laid out an alternative plan. The bonds are to repay the state= =20 for $5 billion in power purchased since January for customers of Pacific Ga= s=20 & Electric Co. Southern California Edison and San Diego Gas & Electric. Th= e=20 remainder of the bond issue would pay for future power for those customers.= =20 Assembly Republican Leader Dave Cox Sacramento said taxpayers have the=20 surplus funds and should use that to get out of the crisis rather than=20 financing the total bill.=20 ``There's no need for the bridge loan'' Cox said. ``This is about fiscal= =20 responsibility not borrowing money you don't have to borrow. The state of= =20 California needs to tighten its belt just like California ratepayers and= =20 taxpayers had to.''=20 Davis has not decided whether to sign the power authority bill the spokesm= an=20 said. But Davis has said he supports creating an authority similar to one i= n=20 New York. The New York authority has 10 power plants and 1400 miles of=20 transmission lines and produces about 25 percent of the state's power.=20 The 24-14 vote on the bill was split down party lines. ALL CAPS HED=20 Published Friday May 4 2001 in the San Jose Mercury News=20 Developments Thursday in California's energy crisis:=20 The state Senate sends a bill to the governor that would create a state=20 public power authority to build and buy power plants.=20 Secretary of State Bill Jones a Republican candidate for governor propose= s=20 a utility rescue plan that would take the state out of the electricity=20 business.=20 State Treasurer Phil Angelides says Assembly Republicans are ``holding thei= r=20 own state hostage'' by not approving a bond-authorization bill for power=20 purchases.=20 Energy Secretary Spencer Abraham meets in the Capitol with Gov. Gray Davis. Source:?Associated Press=20 Energy notebook=20 Vote delayed on $12 billion state bond for power.=20 May 4 2001=20 SACRAMENTO - California lawmakers delayed voting on a $12 billion bond sale= =20 for power purchases after Republicans proposed to reduce the size of the sa= le=20 and use part of the state's surplus to cut electric rates.=20 Assembly Republican leader Dave Cox of Sacramento proposed reducing the bon= d=20 sale to $8 billion and using $5 billion of California's budget surplus to c= ut=20 rates for consumers.=20 California began buying power for its cash-strapped utilities this year and= =20 has spent $5.6 billion so far. The state expects to spend about $15.1 billi= on=20 on power this year according to a report released this week by Gov. Gray= =20 Davis.=20 Lawyer hired to probe possible price-gouging=20 SACRAMENTO - A lawyer who won big verdicts against Ford Motor Co. and the= =20 Roman Catholic Church was appointed Wednesday to lead a state Senate=20 investigation into possible price-gouging and antitrust violations by=20 electricity producers.=20 Laurence Drivon a Stockton lawyer has taken a temporary leave from his=20 practice and will work in the office of Sen. Joe Dunn D-Santa Ana.=20 Dunn chairs the committee that is looking into why California's energy pric= es=20 have skyrocketed what legislative action must be taken to remedy the=20 problem and whether there is any proof of criminal misconduct on the part = of=20 the power producers.=20 Drivon is credited as co-counsel for $295 million verdict in a 1999 case=20 against Ford for a rollover accident that killed three passengers in a 1978= =20 Bronco. Drivon also won a $30 million verdict against the Roman Catholic=20 Diocese of Stockton in 1998 after he showed the church knew a parish priest= =20 had molested two children but failed to intervene.=20 Dunn also announced the formation of a statewide coalition of district=20 attorneys to look into the allegations.=20 PG&E wants ISO to cease trying to bill it for power=20 SAN FRANCISCO - Pacific Gas & Electric Co. has asked a federal bankruptcy= =20 judge to stop the state's power grid manager from charging the utility for= =20 expensive last-minute electricity it has bought.=20 California's largest utility filed the motion Thursday asking that the=20 Independent System Operator comply with bankruptcy law ... and stop billin= g=20 the utility for wholesale power purchased.=20 The utility is barred from repaying debts incurred before its bankruptcy=20 filing without permission from U.S. Bankruptcy Judge Dennis Montali. PG&E= =20 also wants to stop paying the bill for any future ISO buys on its behalf.= =20 Jones floats plan to try to rescue utilities state=20 SACRAMENTO - Saying power purchases will drive California deeply into debt= =20 Secretary of State Bill Jones proposed a utility rescue plan Thursday that= =20 would take the state out of the electricity business.=20 The state of California must get out of the power business immediately to= =20 avoid mortgaging our children's future said Jones a Republican candidate= =20 for governor.=20 If the governor doesn't change course it will take decades for California= 's=20 budget and economy to recover.=20 Jones' four-part plan calls for:=20 Utility creditors to accept less than full payment in exchange for immediat= e=20 partial compensation.=20 A significant infusion of cash from the utilities' parent companies to he= lp=20 pay off the debts.=20 The utilities to accept less than full payment for money they owe themselve= s=20 for power they generated and sold to themselves at high prices through the= =20 state power pool.=20 The state would make low-interest loans to the utilities to cover the rest = of=20 their debts.=20 Instead of the state buying the utilities' transmission lines as Davis has= =20 proposed the utilities would retain them as loan collateral.=20 PG&E suit for $10 billion from ratepayers dismissed=20 SAN FRANCISCO - A federal judge has dismissed as premature a lawsuit filed= =20 against the state's Public Utilities Commission by California's largest=20 utility Pacific Gas & Electric Co. that sought $10 billion from Californi= a=20 ratepayers.=20 PG&E had asked the U.S. District Court in Los Angeles to overrule PUC=20 decisions that the utility was not entitled to the money which the utility= =20 spent buying electricity on the increasingly expensive wholesale market.=20 District Judge Ronald S.W. Lew dismissed the suit Wednesday saying PG&E's= =20 claims are not yet ripe for review. He said PG&E may refile once the=20 commission's interim orders become final and a PG&E statement afterwards= =20 said that allows us to continue to pursue the merits of the case.=20 State weighed connecting power grid to nuclear ships=20 SAN DIEGO - California officials considered tapping nuclear-powered warship= s=20 to supplement power during peak demand this summer but dropped the idea=20 after deciding it wasn't worth the effort Pentagon officials said Thursday= .=20 Linking nuclear-powered submarines and aircraft carriers to the state power= =20 grid is possible but would yield little electricity for the extensive=20 modifications that would be required Pentagon spokesman Rear Adm. Craig=20 Quigley said.=20 It would not be much of an advantage ... to go through that engineering= =20 Quigley said.=20 Davis to ask generators for profit concessions=20 SACRAMENTO - Gov. Gray Davis asked the chief executives of the largest U.S.= =20 energy producers and traders to meet with him next week when he will ask= =20 them to forgo some profit from selling power in the state.=20 The meeting is set for Wednesday in Sacramento.=20 The Associated Press Bloomberg News and Register staff writer Kimberly Kin= dy=20 contributed to this report.=20 U.S. conservation order called Bush's best effort=20 The energy chief says there's not enough time for other action.=20 May 4 2001=20 By DENA BUNIS The Orange County Register=20 WASHINGTON - President George W. Bush's order that federal agencies conserv= e=20 every megawatt they can is the best way he can help California live through= a=20 hot summer of expected blackouts the nation's energy chief said Thursday.= =20 We have a crisis and an emergency this summer that could result in 30 to 3= 5=20 days of some form of blackouts taking place in California'' Energy Secreta= ry=20 Spencer Abraham said after a White House meeting of the president's energy= =20 team. We don't have time between now and those occasions to develop new-= =20 generation sources sufficient to meet that challenge.''=20 Bush's order directs all agencies to report to Abraham within 30 days on=20 their plans for conserving power during peak demand and particularly in=20 California during electricity emergencies.=20 We're worried about blackouts that may occur this summer'' Bush said afte= r=20 his meeting. And we want to be a part of any solutions.=20 When California reaches a Stage 2 emergency which means electricity reserv= es=20 fall below 5 percent federal facilities will implement a conservation plan= =20 that includes setting thermostats at 78 degrees. Other measures under=20 consideration include installing more efficient lighting closing off=20 unneeded space and doing some work at off-peak times.=20 Off the table Abraham said were suggestions that the federal government= =20 transfer power to the state from nuclear submarines or aircraft carriers.= =20 They would yield little power and the potential for safety problems was=20 great.=20 Federal power usage amounts to a little less than 2 percent of California's= =20 electricity needs. About 1 percent of that is at military installations.=20 Deputy Defense Secretary Paul Wolfowitz said his department's goal is a 10= =20 percent reduction in electricity use this summer and an additional 5 percen= t=20 by next summer.=20 We are going to do our part to try to mitigate the energy shortage through= a=20 combination of conservation power generation an investment in energy=20 efficient methods'' Wolfowitz said.=20 Abraham said there is no firm figure for nonmilitary conservation.=20 He flew to California on Thursday afternoon another effort to blunt=20 criticism of the administration's inaction during the crisis.=20 He met with Gov. Gray Davis and was to meet today in San Francisco with=20 federal officials to talk about the conservation plan.=20 Davis on Wednesday had criticized the impending order as not enough. The=20 state has cut usage by 20 percent.=20 Every time we take an action there's someone somewhere who says we should = do=20 something different'' Abraham said. We think this is the most constructiv= e=20 action we can take in this time.''=20 And while Sen. Dianne Feinstein D-Calif. said of the president's action= =20 that every little bit helps'' she and other Western senators Thursday=20 continued to criticize federal regulators for not going further to curb=20 prices.=20 This is unsustainable politically for this administration for this=20 Congress said Republican Sen. Gordon Smith of Oregon. Smith and Feinstein= =20 have authored a bill to allow much deeper price controls than those approve= d=20 by the Federal Energy Regulatory Commission last week.=20 On the long-range front Bush met with Mexican President Vicente Fox on=20 Thursday. They talked generally about the U.S. importing energy from Mexico= =20 and Canada countries with large oil and gas reserves. [B] POWER UPDATE/ Bush directs feds to save energy in California (BridgeNews) May 3 1952 GMT/1552 ET TOP STORIES: Bush directs federal government to save energy in California Washington May 3 (AP) - President Bush on Thursday ordered all federal agencies in California to cut power use saying we want to be a part of a= ny solutions to an energy crunch that could cripple the largest state. ( Story .19646 ) Air emissions exemptions in House energy bill criticized Santa Fe N.M. May 3 (BridgeNews) - Legislation to temporarily exempt new power plants from air emissions limits isn't needed because state and feder= al regulations are flexible enough to allow for maximum output Michael Kenney= =20 an executive of the California Air Resources Board said Thursday testifying before a U.S. House Energy and Air Quality subcommittee. Others argued provisions of the bill allowing businesses to generate and sell their own= =20 power are harmful to the environment and unfair to certain consumers. ( Story .19200 ) Pacificorp calls for region-wide US West power price cap Santa Fe N.M. May 3 (BridgeNews) - Pacificorp wants region-wide price caps in U.S. western power markets with all market participants under the s= ame price mitigation rules a company representative told a U.S. House energy subcommittee Thursday. The company is one of the few investor-owned utiliti= es outside of California to adopt such a position. ( Story .18379 ) Repeats: Duke Energy: Will pay to end Calif. power price probe Santa Fe N.M. May 2 (BridgeNews) - Duke Energy North America said Wednesday it will build new generation in California sell power on a=20 long-term basis forgive some unpaid bills by state utilities and repay alleged overcharges for wholesale power if all investigations into alleged price-gouging by state and federal authorities are resolved at the same tim= e. Duke admitted no wrongdoing. ( Story .16332 ) OF INTEREST: --AMERICAS-- US Northeast real-time power prices high on warm weather Toms River N.J. May 3 (BridgeNews) - Real time power prices in the Northeast U.S. were relatively strong early Thursday as above-normal temperatures swept through the region. However most daily prices slipped a= s lower temperatures are forecast to move in on Friday. ( Story .17034 ) Calif. Gov. Davis says 50 Mw power plant licensed for summer New York May 3 (BridgeNews) - California Governor Gray Davis announced Wednesday the licensing on a 50 Mw King City power project. This makes the fifth summer reliability power plant that has been permitted under the California Energy Commission's expedited emergency review process. ( Story .18775 ) FOCUS: Natgas distributors ready for possible summer price spike New York May 3 (BridgeNews) - Local distribution companies (LDCs) do not plan to get caught short if warmer temperatures drive up the price of natur= al gas this summer. LDCs say they are ready for the possibility and are using various strategies including hedging gas costs and entering into long-term supply pacts to avoid having to buy in an extremely volatile spot market. ( Story .18313 ) Fund companies see US energy policy benefiting power sector New York May 3 (BridgeNews) - As the U.S. flirts with an energy shortage and dramatic fuel and power price hikes mutual funds are salivating over t= he prospects for companies like Duke Energy Corp. Calpine Corp. and Dynegy I= nc. Alternative energy companies like Capstone Turbine Corp. and Ballard Power Systems Inc. however are being left out in the cold as federal energy pol= icy has shifted from emphasizing conservation to feeding supply. ( Story .15998 ) FULL: Allegheny Energy unit closes buy of Midwest gas-fired oprs New York May 3 (BridgeNews) - Allegheny Energy Inc.'s Allegheny Energy Supply Co. LLC unit completed the acquisition of 1710 megawatts of natural gas-fired merchant generating capacity in three Midwest states from Enron Corp.'s Enron North America. --Rajesh S. Kurup BridgeNews ( Story .17696 ) US Press: Bush to order energy conservation at Calif. govt buildings New York May 3 (BridgeNews) - President George Bush is expected Thursday to order federal office buildings in California to conserve energy this sum= mer as a way of helping to address the state's power crises and deflect critici= sm that the administration's energy policy is focusing solely on increased production the New York Times reported Thursday. ( Story .16906 ) --EUROPE-- Nuclear reactor shut down in central Russia due to minor glitch Moscow May 3 (BridgeNews) - A nuclear reactor was automatically shut down Thursday at the Balakovo nuclear power plant in Central Russia due to a min= or glitch in its electricity system state utility Rosenergoatom said. The electricity fault presented no threat to the plant's safe operation and the radiation level at the site remained normal Rosenergoatom added. ( Story .12186 ) Shell Q1 adj profits up 23% at $3.855 bln beating forecasts London May 3 (BridgeNews) - Royal Dutch/Shell on Thursday reported adjusted earnings on a current cost of supplies (CCS) basis for the first quarter of 2001 of $3.86 billion up 23% from $3.13 billion for the same quarter last year. Net income for the quarter was $3.89 billion up 17% fro= m $3.34 billion in the three months of 2000 the company said. The figures we= re above the top end of analysts' forecasts which had pointed to adjusted CCS earnings of between $3.1-3.6 billion. ( Story .12297 ) FOCUS: Scottish Power rides west U.S. crisis no clues on S. Water London May 3 (BridgeNews) - Scottish Power is focussing on consolidating its position in the U.S. since its purchase of Pacificorp and amid the ongo= ing power crisis in the Western U.S. chief executive Ian Russell told reporter= s=20 at a conference Thursday. Russell said that Scottish Power had not yet made a decision on the future of Southern Water and would not be drawn into speculation over the likelihood of a sale to Italy's Enel. ( Story .16660 ) --ASIA/PACIFIC-- Taiwan to accept bids for new power plants around May-end Taipei May 3 (BridgeNews) - Taiwan authorities plans to open a new round of bidding around the end of May for independent power producers (IPPs) to generate a total of 4200 megawatts (MW) of electricity commencing in 2007-2009 an official at the Energy Commission under the Ministry of Econo= mic Affairs (MOEA) said Thursday. The invitation for IPP projects will be the fourth of its kind. ( Story .10571 ) SPOT NEWS LINKS: THE MARKETS: US FUTURES: UK FUTURES .1908 NY Natural Gas Pre-Opg .1795 IPE Nat Gas Review .1906 NY Natural Gas Review .1794 IPE Nat Gas Midday .1747 NY Natural Gas US/CANADA CASH NATURAL GAS UK/EUROPE CASH NATURAL GAS .1894 Henry Hub natural gas .1807 UK Spot Gas .1884 US/Canada Spot Natural Gas US CASH ELECTRICITY UK/EUROPE CASH ELECTRICITY .8575 California PX: Next day .1892 UK Power Index 0.0 .8576 .8577 WSCC Forwards (AM/PM) .1889 Nordic Power Market .8585 .8586 PJM Forwards (AM/PM) .1890 Spanish Power Market .8593 .8594 Cinergy Forwards (AM/PM) .1844 UK EFA Power Market .8597 .8598 Entergy Forwards (AM/PM) CANADA CASH ELECTRICITY .8601 .8602 ERCOT Forwards (AM/PM) .5637 Canadian Power Market .8603 New England Forwards .8587 .8600 TVA Forwards (AM/PM) OTHER .1873 US Nuclear Plants Operating Status .2029 BRIDGE CALENDAR: US POWER: Key events to watch .2030 US Utility Deregulation Digest .1704 US Utility M&A Digest SYMBOL LINKS: Click below for adamb chart in Athena NATURAL GAS NYMEX - IPE - NYMEX ELECTRICITY Palo Verde electricity - COB electricity- Cinergy electricity - Entergy electricity - PJM electricity - BridgeNews Send comments to gennews@bridge.com Judge Dismisses $10B PG&E Suit By KAREN GAUDETTE Associated Press Writer SAN FRANCISCO (AP) via NewsEdge Corporation - A federal judge has dismissed a lawsuit filed against the California Public Utilities Commission by the state's largest utility which sought $10 billion from ratepayers. PG&E had asked the U.S. District Court in Los Angeles to overrule PUC decisions that the utility was not entitled to the money which the utility spent buying electricity on the increasingly expensive wholesale market. In dismissing the lawsuit Wednesday Judge Ronald S.W. Lew said ``PG&E's claims are not yet ripe for review'' meaning the case wasn't ready for trial. Steve Maviglio spokesman for Gov. Gray Davis declared the decision a win for California ratepayers. ``PG&E was banking on winning this case and using it as one of their excuses for not negotiating with the governor. It appears at least for now they failed'' Maviglio said. But because the case was dismissed on procedural grounds rather than merit PG&E said the door was left open for the utility to refile its action once the commission makes final its interim orders on PG&E's requested rate increase. ``The court determined that our lawsuit was premature because the CPUC had not yet finalized its various decisions on PG&E's request for recovery of its costs to purchase wholesale power'' PG&E said in a statement. ``Today's action allows us to continue to pursue the merits of the case on a timely basis.'' A similar federal case filed by Southern California Edison is on hold said company spokeswoman Clara Potes-Fellow. Edison the state's second-largest utility would drop that case as part of a rescue plan negotiated by Davis which also includes the state buying the utility's transmission lines for $2.7 billion. Since last June the two utilities say they have lost more than $14 billion. California's 1996 deregulation law froze electricity prices for customers of the state's three investor-owned utilities. When prices rose to record levels over the past year PG&E was unable to recoup the higher costs from its customers' bills. The undercollection along with a failed deal to sell its transmission lines to the state drove PG&E to file for federal Chapter 11 bankruptcy protection on April 6 the company argued. On Wednesday the parent company PG&E Corp. reported a first-quarter loss of $951 million or $2.62 per share. The first-quarter loss follows a fourth-quarter loss of $4.1 billion that also stemmed from continuing costs in California's power crisis. Bankruptcy Update/ PG&E Files Motion to Require CAISO to Follow Federal Law SAN FRANCISCO--(BUSINESS WIRE)--May 3 2001 via NewsEdge Corporation - Pacific Gas and Electric Company has filed a motion in the U.S. Bankruptcy Court asking the court to direct the California Independent System Operator (CAISO) to comply with bankruptcy law its Tariff and a recent Federal Energy Regulatory Commission (FERC) ruling and stop billing the utility for wholesale power purchased. Pacific Gas and Electric Company's motion which includes a request for a preliminary injunction asks the court to enjoin the CAISO from requiring the utility to pay costs the CAISO has incurred and continues to incur to purchase wholesale power on its behalf unless the utility can fully recover these costs. Bankruptcy law imposes an automatic stay to prevent parties from making certain claims or taking certain actions that would interfere with the estate or property of the estate of a Chapter 11 debtor. By purchasing power at costs higher than existing retail prices and then sending the bill to the utility the CAISO is violating the automatic stay provision and could be reducing the value of the company's assets by potentially hundreds of millions of dollars per month depending on the average retail rate the wholesale price and the amount of power purchased by the CAISO. Recently the CAISO sent Pacific Gas and Electric Company a bill for January and February spot market purchases that totaled nearly $1 billion. The action alleges that requiring the utility to pay more than it can collect in its existing generation-related rates would be improper under federal Bankruptcy Code because it is not in the best interest of the estate would be an unauthorized post-petition use of Pacific Gas and Electric Company's property and would force the utility to undertake credit on onerous terms. In addition on April 6 2001 FERC ordered the CAISO to comply with its February 14 order in which FERC ordered that the CAISO could only buy power on behalf of creditworthy entities. Both Pacific Gas and Electric Company and Southern California Edison Company are no longer creditworthy companies. By continuing to purchase power on behalf of Pacific Gas and Electric Company the CAISO is in violation of its own Tariff FERC orders and federal law. CONTACT: Pacific Gas and Electric Company | News Department= =20 415/973-5930 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Bob Iveson and Karl Stahlkopf (EPRI), in your office. - Confirmed Body:: cc:Mail to Bruce Stram and Tim Vail sent 6/23. Tim Vail is confirmed Bruce will be here until 10:00. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Issues Database Body:: One more -- Nick O'Day in Tokyo ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: VOICE MAIL Body:: I got the message and will handle. Tahnks Steven J Kean 03/01/2000 11:37 AM Sent by: Maureen McVicker To: Steven J Kean/HOU/EES@EES cc: Subject: VOICE MAIL Joe Sutton called and wants to discuss how the vision groups are going. Have they taken place what are the plans now? He thinks you should report it to the Exec Committee the next time you meet but Joe wants to see the report first. I have attached below the response Mary Clark sent to you regarding the meetings (in case you want to forward it). I did not forward this to Joe. I wanted to check with you first. Also Joe said he spoke with Ken Lay regarding the Annual Report - Ken's concern about the cover and the Chairman's Award is the fact that the winner is not pictured on the cover. The runner ups are there but not the winner and he thinks the winner should also be in the picture. EMAIL FROM MARY CLARK: Steve I've attached the results of the focus groups as per my notes from the meetings. Let me know if you need anything else. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Message from Clark C. Smith Body:: include on the distribution list and send out note about the Monday meeting. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: SCE Counter Claim -- Underreporting of Volumes -- Confidential -- Attorney Work Product Body:: After speaking with George Phillips yesterday about SCE's counterclaim against EES and EEMC regarding underreporting of usage to the ISO I think there may be some internal confusion (of which I may have contributed to) about the nature of SCE's counterclaim. As I understand from my review of certain documents received from SCE in response to our data requests review of an Executive Summary prepared by George Phillips on the issue and from my conversation with him yesterday EES and EEMC as a result of some problems with their settlement system did indeed underreport customers' usage to the ISO during the time period claimed by SCE. This has I believe resulted in two separate (although interrelated) points of contention with SCE -- of which only one is the subject matter of its counterclaim. First the underreporting resulted in Unaccounted For Energy (UFE) charges to the market. In correspondence sent by SCE to EEMC and EES during the last quarter of 2001 it appears that SCE was calculating the cost to the market from the EES/EEMC underreporting by applying the hourly day ahead market clearing price to the individual hourly variances. This cost to the market is overestimated however as SCE failed to take into account the fact that the ISO nets underreported amounts against overreported accounts to get a net amount of underreporting. This underreported amount is then allocated to all providers of physical load within a service territory through the assessment of UFE charges. Thus whatever the ultimate cost was determined to be SCE would not be allocated the entire amount. Second the underreporting of usage to the ISO results according to SCE in SCE paying EES and EEMC a PX credit for energy they never purchased. This claim is separate and apart from what SCE claims EES/EEMC cost the market in the way of UFE charges. What SCE is saying is that it believes that EES and EEMC only purchased on behalf of their customers the amount of energy which they reported to the ISO. EES' and EEMC's customers actually used more than the amount which EES and EEMC reported. SCE calculated the PX credit based on the amount used not reported. It is SCE's claim that EES and EEMC are not entitled to a PX credit on the delta as the market not EES and EEMC purchased those volumes. It is only the second point of contention which is the subject matter of SCE's counterclaim. SCE is alleging that it should not have to pay a PX credit to EES and EEMC for volumes that EES and EEMC did not purchase. SCE is claiming that we only purchased the amount we reported to the ISO. While SCE may believe that it should not have to pay any UFE charges as the result of EES/EEMC underreporting the UFE charges are not the basis of its counterclaim. Based on the above analysis I think that the most critical piece of information to refute the counterclaim is that despite the underreporting of volumes to the ISO EES and EEMC actually purchased on behalf of their DA customers those customers' full usage. Can we make such claim? and do we have data to back it up? Jeanne Bennett What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Revised Electricity Emergency Authorities Memo Body:: This is a thorough and helpful analysis. But have we considered the broader emergency powers the president might have (i.e. beyond the clean air act waivers requested by a governor)? It would seem that the importance of the defense business in California the large number of military facilities the public safety hazards of widespread blackouts etc. ought to trigger some broader authority. Richard Shapiro 05/21/2001 05:26 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Revised Electricity Emergency Authorities Memo FYI ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CFTC call to Gramm Body:: Not yet. May not be until sept 5 as ken is on vacation. but there is a chance that ken will try to reach him in the meantime. I'll let you know when I hear. From: Chris Long 08/21/2000 03:22 PM Sent by: Amy Fabian To: Steven J Kean/NA/Enron@Enron cc: Subject: CFTC call to Gramm Steve - Missed you in LA last week. Thanks for working with Ken on the CFTC talking points. Do you know if the call between Ken and Sen. Gramm occured and if there was any follow up needed. Thanks - Chris What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - General Expenses Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Message points Body:: please print What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PDF Attachment-Request for Confidential Information by the GAO Body:: A PDF version of the original letter is attached below. To All California Power Exchange Participants: Notice is hereby provided pursuant to Section 19.3.4 of the California Power Exchange Tariff that the United States General Accounting Office (GAO) as part of the ongoing investigation of California markets has requested the same information to be provided to the Federal Energy Regulatory Commission (FERC). Such information may be confidential under Section 19.3.2 of the Tariff. The manner in which the GAO will treat such confidential information is outlined in the attached letter. The GAO states that it has authority under 31 U.S.C. 717 to evaluate programs or activities of the Federal Government in this case deregulation of the electricity markets initiated by FERC. The GAO has requested the California Power Exchange to provide such information no later than Thursday October 5 2000. If you desire to assert a claim of privilege or confidentiality pursuant to legal authority the California Power Exchange will include your written assertion of that claim together with its submittal to the GAO provided that it is timely received. Your written statement should be directed to the GAO as follows: Mr. Jim Wells Director Energy Resources and Science Issues United States General Accounting Office Washington DC 20548 You may deliver your statement to the California Power Exchange as follows: Karen Koyano California Power Exchange 1000 S. Fremont Avenue Unit 20 Alhambra CA 91801 626.537.3173 facsimile Any written statement must be received by Ms. Koyano no later than Wednesday October 4 2000 5:00 p.m. Pacific Daylight Time to be included with any information delivered to the GAO. You are also free to take any other legal action you may deem appropriate in the circumstances of this investigation. Thank you. (See attached file: GAO Letter 9-22-00.pdf) - GAO Letter 9-22-00.pdf What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: DRAFT PRESS RELEASE: NBP Announces Intent to Purchase ENA Assets in Powder River and Wind River Basins Body:: Eric - I think the release looks fine. Shelley -- I take it there are no affiliate issues here (or they have been fully vetted)? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL BUSINESS PROPOSAL Body:: And another..... What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Summary of $ at Risk for Customs Body:: Please see attached. Rob perhaps while in London you could stop by Mark's desk to discuss. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: i2 Bandwidth Management Agreement Press Release Body:: looks good Meredith Philipp 10/13/2000 09:30 AM To: Kenneth Lay/Corp/Enron@ENRON Jeff Skilling/Corp/Enron@ENRON Joseph W cc: Rosalee Fleming/Corp/Enron@ENRON Sherri Sera/Corp/Enron@ENRON Pam Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Subject: i2 Bandwidth Management Agreement Press Release Attached is a draft news release announcing Enron's bandwidth management agreement with i2. EBS is planning to issue this release on Monday Oct. 16 prior to Enron's earnings release on Tuesday Oct. 17. Please review and let me know if you have any comments by end of day today Friday Oct. 13. Thank you. Meredith Philipp What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Information for Jeff Skilling from Kevin Scott Body:: Confirming 1:00 p.m. meeting on June 12 at the Venetian Resort in Las Vegas. Thanks Joannie Williamson 713-345-7774 Kevin Scott on 04/25/2001 04:46:18 PM Please respond to To: Jeff Skilling cc: Sherri Sera Subject: Information for Jeff Skilling from Kevin Scott ? ? ? ? ? April 25 2001 ? ? ? Dear Jeff ? Thank you for setting aside time to meet with me.? I have attached my resume to help bring you up to date on my career.? ? As you will see I have been providing advisory services since 1995.?? During these years I have done some of my best work.? I am proud of the service that I have rendered as an independent consultant.? ? Now I feel it is time to move to a new chapter in my career.? I look forward to sitting down with you to think through ways to apply my experience intellect and energies to new professional challenges.? I respect you tremendously and wherever the next part of my career may lie I know that my search and choice will benefit significantly from your perspective. ? Finally I am attaching the recommendation to HBS that you wrote in 1981.? I found it during a profoundly challenging period in my life.? Your historic words of support helped me keep fighting and successfully moving forward. ? If you would like to reach me before our meeting please call (213) 926-2626 or email Thank you again. ? Sincerely ? [IMAGE] ? Kevin ? ? Attachments (2) - image001.png - image002.gif - Resume of Kevin Scott.doc - Skilling HBS Recommendation.doc What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions Body:: California Blame Game Yields No Score --- Probes Reveal Little Evidence Suppliers Acted Illegally The Wall Street Journal 05/22/01 Enron Unit Moves to End India Contract For Power The New York Times 05/22/01 The State GOP Criticizes Davis' Choice of PR Aides Capitol: Legislative leaders call the pair political operatives who are too partisan to represent the state during energy crisis. Los Angeles Times 05/22/01 BUSINESS DIGEST The New York Times 05/22/01 World Watch The Wall Street Journal 05/22/01 IN BRIEF / ENERGY Enron Withdraws from Qatar Project Los Angeles Times 05/22/01 INDIA: UPDATE 1-Indian state spurred by Enron reopens power deals. Reuters English News Service 05/22/01 INDIA: India utility may slap 4bln rupee fine on Enron unit. Reuters English News Service 05/22/01 IXEurope creates a Storm in colocation M2 Presswire 05/22/01 Power corrupts... The Economic Times 05/22/01 The Godbole findings Business Standard 05/22/01 SMARTMONEY.COM: Power Grab Dow Jones News Service 05/22/01 Malaysian LNG Sales to India Threatened by Enron Power Dispute Bloomberg 05/22/01 LEADER: India unplugged Financial Times May 22 2001 Enron pulls out of venture drilling in Qatar's waters Houston Chronicle 05/22/01 Enron exploring commodity trading Houston Chronicle 05/22/01 Plains Resources Gets New Officers Houston Chronicle 05/22/01 Economy California Blame Game Yields No Score --- Probes Reveal Little Evidence Suppliers Acted Illegally By John R. Emshwiller Staff Reporter of The Wall Street Journal 05/22/2001 The Wall Street Journal A2 (Copyright (c) 2001 Dow Jones & Company Inc.) LOS ANGELES -- California may be struggling to keep its lights on but one thing there is no shortage of is accusations over who is to blame for an electricity crisis that has sent power prices skyrocketing. In recent days top California officials have stepped up their rhetoric against a handful of merchant power companies many of them Texas-based that supply the state with much of its juice. Gov. Gray Davis says companies such as Reliant Energy Inc. of Houston have engaged in unconscionable price gouging. Loretta Lynch president of the California Public Utilities Commission and a Davis appointee proclaims that a cartel of electricity producers has created artificial shortages. Lt. Gov. Cruz Bustamante is backing a bill that would make energy price fixing a felony and as a private citizen he is suing several major power producers in Los Angeles state court. About half a dozen investigations are being conducted by entities ranging from state legislative committees to the California attorney general's office. So far these probes -- some of which have been under way for months -- haven't yet yielded either civil or criminal charges. While the energy suppliers are generating unconscionable profits the question remains whether they are illegal profits says California Attorney General Bill Lockyer who has offered rewards of as much as hundreds of millions of dollars for information about lawbreaking in the energy business. Mr. Lockyer says he believes his office will eventually file civil charges against suppliers. He would very much like to add criminal counts. I would love to personally escort [Enron Corp. Chairman Kenneth] Lay to an 8 x 10 cell that he could share with a tattooed dude who says `Hi my name is Spike honey' adds Mr. Lockyer. Houston-based Enron is a major energy-trading company. Like other such firms Enron has denied wrongdoing in the California market. Mark Palmer Enron's vice president for corporate communications said Mr. Lockyer's comment about Mr. Lay is so counterproductive that it doesn't merit a response. Investigators and academics say there is abundant evidence that individual firms have been exercising market power. This term is used to denote efforts to influence wholesale-electricity prices such as by withholding supplies. The California Independent System Operator or ISO which manages the state's electric transmission grid estimates that by exercising market power suppliers may have added about $6.8 billion to the cost of electricity in the state since early last year. A single firm exercising such power isn't necessarily illegal says Severin Borenstein director of the University of California Energy Institute. If a company is a large supplier in the state and you're not exercising market power you are not doing your job on behalf of shareholders he says. Mr. Borenstein and others say that there are steps that should be taken against suppliers. They note that under federal power law the Federal Energy Regulatory Commission can order refunds for wholesale prices that are above just and reasonable levels. So far FERC has tentatively ordered California suppliers to make tens of millions of dollars of such refunds as part of that agency's ongoing inquiry into the California market. Critics of the suppliers and FERC say the refunds should be in the billions of dollars. The power industry not surprisingly says there is nothing to accusations of price manipulation or collusion. Executives point to a botched state-utility-deregulation plan that relies heavily on volatile spot-market purchases. Suppliers note that over the past decade California didn't build enough new power plants to keep up with demand growth. The allegations of manipulation are a lot of sound and fury and they won't produce anything says Gary Ackerman executive director of the Western Power Trading Forum an industry trade group. Power generators also point to sharp increases in some of their costs particularly natural gas which is a major power-plant fuel. This rise in natural-gas prices also has set off a flurry of investigations over possible manipulation. One such case involving El Paso Corp. Houston is the subject of probes by federal and state officials. El Paso denies any wrongdoing. While power-industry officials say they have been cooperating with the investigations law-enforcement officials say they have hit some roadblocks. For instance Mr. Lockyer's office has gone to San Francisco state court to enforce subpoenas against Reliant Houston-based Dynegy Inc. and Southern Co. and Mirant Corp. both of Atlanta after the companies resisted turning over certain business documents they deemed confidential. Investigators have zeroed in on the increased frequency with which plants are going out of service for unscheduled outages. At times several thousand fewer megawatts of capacity are available than a year ago. A thousand megawatts can power about one million homes. Generators say that this increased forced outage rate shows that tight supplies over the past year have required them to run plants some of them more than 40 years old for long periods without routine maintenance. This combination has produced more breakdowns. Plants have been running flat out says Tom Williams a spokesman for Duke Energy Co. Charlotte N.C. which says that its California power plants produced 50% more electricity in 2000 than in 1999. At the same time during periods of lower demand the number of unplanned outages often seems to rise enough to keep supplies tight says Frank Wolak a Stanford University professor and chairman of the ISO's market surveillance committee. Clearly something is going on here. However he and others say that it is almost impossible to tell why a particular pipe failed or whether such a failure was a legitimate reason to reduce output. Some of the most intriguing evidence to date about forced outages surfaced in a federal case. FERC officials said an investigation had raised questions about whether two major power companies had taken plants out of service in order to reap higher electricity prices. The charges against AES Corp. Arlington Va. which owns the plants and Williams Cos. Tulsa Okla. which markets their output asserted that those actions allowed the companies to reap an extra $10.8 million in revenue. In one instance according to case filings a Williams employee indicated to AES officials that his firm wouldn't financially penalize AES for extending an outage at one plant. This conversation which was voluntarily divulged by Williams could be an indication of collusion. Williams and AES settled the case without admitting any wrongdoing by paying back $8 million to the ISO and by taking certain other measures. A Williams spokeswoman says the employee who talked to AES was counseled not to enter into any conversations of that nature in the future. Another issue raised by the FERC case touched on maintenance procedures. According to the filings AES stopped doing a certain procedure to keep its plant's cooling system from getting clogged. The clogging of the system was cited as a reason for one of the forced outages. Mark Woodruff president of the AES unit that operates the plant in question says the company substituted what it felt was an equally effective maintenance procedure. If someone was looking to keep supplies tight and prices high changes in maintenance procedures would be an easy way to ensure that plants particularly old ones have frequent forced outages says a senior utility-industry executive. By restricting maintenance resources he says an operator can simply allow a plant to take itself out of service. --- Journal Link: What is California doing to alleviate the energy crisis? See a video report of California State Treasurer Philip Angelides discussing the state's plans in the online Journal at WSJ.com/JournalLinks. --- Investigations Aplenty In the year since California's energy deregulation plan began resulting in higher prices and even blackouts a flurry of investigations has gotten under way. Here are the main ones: AGENCY: Federal Energy Regulatory Commission INVESTIGATION: Whether generators are charging more than just and reasonable rates as demanded by the Federal Power Act whether El Paso Corp. used its position as a major natural-gas supplier to the state to illegally drive up the price of fuel used to generate electricity. AGENCY: California Public Utilities Commission and the State Attorney General INVESTIGATION: Whether generators and power traders have acted illegally through collusion or other means to artificially inflate electricity prices. AGENCY: PUC and California Independent System Operator INVESTIGATION: Whether generation plants were shut down for spurious reasons in order to create supply shortages and thus to raise electricity prices. AGENCY: California Electricity Oversight Board INVESTIGATION: Whether patterns of bidding and pricing in California's electricity auction indicate collusive or otherwise illegal behavior. Sources: state and federal agencies Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Business/Financial Desk Section W Enron Unit Moves to End India Contract For Power By SARITHA RAI 05/22/2001 The New York Times Page 1 Column 6 c. 2001 New York Times Company BANGALORE India May 21 -- Fed up with its main customer's refusal to pay its bills the Enron Corporation's Indian power-generating venture served formal notice on Saturday that it would terminate its power supply contract and pull out. The move by the Dabhol Power Company 65 percent owned by Enron starts the clock ticking on a six-month notice period before the contract is voided during which negotiations to settle the dispute are expected. The $2.9 billion Dabhol project represents the largest single foreign investment in India. Separately Enron said today that it was withdrawing from a pipeline project in Qatar which would have supplied some gas to Dabhol. The company said that the two steps were unrelated. The Dabhol project has been the subject of a series of wrangles between the company and the governments of India and of the western Indian state of Maharashtra. The state-owned utility company that contracted to buy power from the Dabhol plant has defaulted on some $64 million in unpaid power bills and has accused Dabhol of charging too much. Dabhol said it was left with little choice but to issue the termination notice after both governments failed to honor their contractual commitments to buy and pay for its output. But in a statement issued over the weekend Dabhol said it was ''still open to constructive discussion on the solutions.'' The company said a ''lasting and feasible solution'' to the dispute would require that the two governments either honor their obligations to buy Dabhol's power or find other creditworthy buyers to take the power instead. The first phase of the project now generates 740 megawatts of power and the second phase adding another 1444 megawatts of capacity is scheduled to go on line next month. Under the contract the termination that Enron has set in motion would oblige the federal and state governments to pay damages to Enron and the lenders that financed the project possibly as much as $500 million -- the value of a year's output of power plus the project's $300 million in debt -- if it is shut down. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. California Metro Desk The State GOP Criticizes Davis' Choice of PR Aides Capitol: Legislative leaders call the pair political operatives who are too partisan to represent the state during energy crisis. DAN MORAIN TIMES STAFF WRITER 05/22/2001 Los Angeles Times Home Edition B-8 Copyright 2001 / The Times Mirror Company SACRAMENTO -- Republican legislative leaders Monday blasted Gov. Gray Davis' decision to spend $30000 a month in taxpayer money to retain communications consultants known for their highly partisan work. Labeling consultants Mark Fabiani and Chris Lehane as cut-throat Senate GOP leader Jim Brulte of Rancho Cucamonga and Assembly Republican leader Dave Cox of Fair Oaks said in a letter to Davis that the hiring undermines the assertions you have made both publicly and privately throughout this crisis. Davis announced Friday that he retained the duo and that the state will pay them a combined $30000 a month for at least the next six months. We're not going to support the hiring of political hacks on government payroll Brulte said in an interview. Lehane and Fabiani are very talented. The issue is which payroll is appropriate. . . . These are political opposition research attack dogs. If the governor wants them he ought to pay for them with his $30-million political war chest. Some consumer advocates also criticized the move citing the consultants' work on behalf of Southern California Edison. In their private consulting business Fabiani and Lehane are working to win over public and political support for Davis' $3.5-billion plan to rescue Edison from its financial difficulties. Legislation embodying aspects of the deal is pending in Sacramento. On Monday Brulte and Cox also complained about the consultants' dual role. California taxpayers should not be asked to finance political consultants or individuals who have a vested business interest with the state the letter said. Fabiani and Lehane had worked in the Clinton administration and in Vice President Al Gore's presidential campaign where they gained a reputation as attack-oriented operatives. Lehane on Monday defended the governor's decision to use tax money to pay their fees saying government often hires outside experts and that he and Fabiani will serve as communications advisors to help the governor fight against these generators. The Republicans Lehane added ought to be spending time writing letters to George W. Bush to get him to stop the Texas generators from gouging California. . . . That is the real issue here. Davis meanwhile returned to California on Monday after a weekend of fund-raisers. He was in Texas on Saturday for a Dallas event that had been scheduled for April 11. It was postponed when Pacific Gas & Electric filed for bankruptcy protection. There is a very large fund-raising base for Democrats in Texas Davis' campaign strategist Garry South said of the state that is home to some of the generators that Davis has criticized. Davis traveled to Chicago for another fund-raiser Sunday then met Monday with city officials to discuss how Chicago deals with electrical blackouts. After blackouts crippled downtown Chicago in the summer of 1999 Mayor Richard M. Daley demanded that the city's electricity provider Commonwealth Edison give advance notice of power cuts. Customers now sometimes receive warnings two or three days in advance. Davis emerged from the meeting saying the utilities have got to tell us in advance when they're going to have a planned blackout. It was not however readily apparent how Chicago's solutions would translate to California because its electrical problems are vastly different. Rather than suffering a shortage of electricity throughout the grid like California Chicago has the more microcosmic ills of an aging system--an obsolete transformer going down for example leaving several city blocks in the dark until workers can fix it. * Times staff writer Eric Slater contributed to this story. PHOTO: Protester Barbara King shakes a light bulb outside Sacramento office of a lobbyist for energy producer Enron near the Capitol. PHOTOGRAPHER: ROBERT DURELL / Los Angeles Times Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Business/Financial Desk Section C BUSINESS DIGEST 05/22/2001 The New York Times Page 1 Column 1 c. 2001 New York Times Company Enron Moves to End India Contract Fed up with its main customer's refusal to pay its bills Enron's Indian power-generating venture said that it would terminate its power supply contract. [World Business Section W.] Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. International World Watch Compiled by David I. Oyama 05/22/2001 The Wall Street Journal A18 (Copyright (c) 2001 Dow Jones & Company Inc.) EUROPE/MIDEAST Insurer Storebrand Favors Sampo's Bid Over Den Norske Norway's largest insurer Storebrand became the center of a bidding war between Finnish financial-services company Sampo and Norway's Den Norske Bank with Storebrand favoring Sampo. Sampo's offer values Storebrand at 20.8 billion Norwegian kroner ($2.3 billion) compared with DnB's 17.6 billion kroner bid as the Nordic region's top financial companies battle for position in a consolidating sector. Sampo and Storebrand in a joint Helsinki news conference said they were confident their deal would succeed. Sampo's cash-and-stock offer valued at 75 kroner a share represents a 31% premium to Storebrand's average share price during the past month and was backed by Storebrand's management. DnB wouldn't say whether it would alter its bid. One cannot count on that its chairman said. HypoVereinsbank Results Disappoint Bayerische Hypo- und Vereinsbank Germany's second-largest bank known as HypoVereinsbank said first-quarter pretax profit rose 25% from a year earlier to 770 million euros ($678 million) below analysts' consensus forecast of 795 million euros. Profit rose 63% to 468 million euros earnings and pretax profit were both helped by one-time gains of 454 million euros. Operating profit fell 59% in the retail-banking division to 98 million euros and was down 43% in the international-markets division to 184 million euros. HypoVereinsbank said tough market conditions world-wide reduced regular commission and interest income. Enron Pulls Out of Emirates Gas Project U.S. energy company Enron has decided to pull out of the multibillion-dollar Dolphin natural-gas project selling its 24.5% stake to the United Arab Emirates Offsets Group or UOG according to Dolphin Energy's managing director Ahmed Al-Sayigh. He didn't specify the reason for Enron's withdrawal or the value of Enron's stake. The Dolphin project agreement reached two years ago by UOG and Qatar Petroleum aims to bring two billion cubic feet a day of natural gas from Qatar's offshore North Field in the Persian Gulf to Abu Dhabi and onward to Dubai. Enron and France's TotalFinaElf each held a 24.5% stake with UOG owning the remaining 51%. Mr. Sayigh said UOG will hold discussions with other companies on a possible sale of Enron's original stake. Richard Bergester manager for Enron Middle East said that having contributed to the project's initial stages Enron now feels it can't add any more. He didn't elaborate. A TotalFinaElf official said it is interested in a greater stake in Dolphin. Marc Rich Gains Control of Swiss Firm Marc Rich the former U.S. fugitive given a controversial pardon by President Clinton effectively pulled off a management coup at Swiss real-estate company Feldschloesschen-Huerlimann Holding by thwarting its merger plans with Swiss Prime Site and forcing the board to quit. Feldschloesschen's ousted chairman Robert Jeker said Marc Rich Group now had control of the company. Mr. Rich himself is not on the board but he controls more than 10% of the votes in Feldschloesschen. ASIA/PACIFIC BRIEFLY: -- Bass Hotels & Resorts a unit of Britain's Bass said it will buy the Regent Hotel Hong Kong for $346 million from Hong Kong's New World Development. -- Indian lenders said they want the Indian government to intervene after U.S. energy company Enron's threat to walk out of its Dabhol Power unit's huge project in Maharashtra state put their loans in jeopardy. Domestic lenders have lent $1.4 billion out of the project's total $2.9 billion cost. -- Australian Prime Minister John Howard caved in to intense pressure over the collapse of HIH Insurance announcing a royal commission into the company's failure and setting aside over 500 million Australian dollars ($265 million) to assist victims of the Australian insurer's collapse. -- Japan's trade surplus shrank at a faster-than-expected pace in April narrowing 42% from a year earlier to 665.9 billion yen ($5.39 billion) as reduced foreign demand weighed on the country's economy. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Business Financial Desk IN BRIEF / ENERGY Enron Withdraws from Qatar Project Bloomberg News 05/22/2001 Los Angeles Times Home Edition C-2 Copyright 2001 / The Times Mirror Company Enron Corp. pulled out of a $2-billion pipeline project to export gas from Qatar as it became increasingly likely that an Indian power-sales agreement will collapse. The company said the move is not related to a filing by its 65%-owned Dabhol Power Co. to India's Maharashtra state's electricity board to stop supplying power because it's owed about $63.9 million by the board. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. INDIA: UPDATE 1-Indian state spurred by Enron reopens power deals. By Narayanan Madhavan 05/22/2001 Reuters English News Service (C) Reuters Limited 2001. BANGALORE India May 22 (Reuters) - India's technology state of Karnataka spurred by a payments row involving U.S. power developer Enron Corp in a neighbouring province has reopened sealed power purchase deals with 11 private firms. The southern state's government has told independent power producers (IPPs) which are yet to start generation that they need to make their tariffs more competitive officials said. Now it (electricity) cannot be at any cost V.P. Baligar chairman and managing director of the Karnataka State Power Transmission Corp Ltd (KPTCL) the state's monopoly power distributor told Reuters in an interview late on Monday. The move comes on the heels of the bitter wrangle in Maharashtra state involving Dabhol Power Co 65-percent owned by Houston-based Enron. Dabhol issued a preliminary notice on Saturday to end a contract to sell power to the Maharashtra State Electricity Board. The step came after Maharashtra ceased payments saying Dabhol's tariffs were too high. The $2.9-billion project which is 90-percent complete was first billed as a showcase of India's decade-old reform programme but now is regarded by critics as a symbol of policy bungling. Enron is a lesson for all of us Baligar said. Karnataka also said it would not provide financial assurances in the form of escrow cover and government loan guarantees which the firms wanted to help sweeten lending rates. We're trying to tell them your tariff has to be competitive Baligar said but added that the state was open to negotiations. You have to have the final capability so you can implement the project without any guarantee or escrow. SIGNED DEALS Five years ago the state signed power purchase deals with 14 private firms. Three of them are already generating power at rates higher than the state would now like to pay. They will continue to get these rates but the 11 unbuilt units face an uncertain future. The 11 plants involve 2000 megawatts (MW) of capacity half of which would be supplied by the Mangalore Power Co (MPC) from which U.S.-based Cogentrix exited in 1999 citing litigation and delays in government approval. China Light & Power now owns the company in which India's Tata group is expected to take 30 percent. MPC Managing Director V.P. Sharma told Reuters that his firm's project would not be hit by the demand for lower tariffs because it was based on coal unlike the Enron project based on naphtha. Our cost is the lowest cost approved (and) coal prices have fallen (since the agreement) Sharma told Reuters from Bombay. Company officials say the project is also looking forward to a federal guarantee to help it move forward. Baligar said the government's intention was to weed out those who are not serious. Those who are serious can sit with us and sort out their problems he said. Power tariffs vary depending upon foreign exchange rates and the type and prices of fuels. Three projects which are already generating power get about 3.0 to 4.0 rupees (6.4 to 8.5 U.S. cents) per unit. The 11 uninstalled plants had comparable rates but MPC says falling coal prices helped its competitiveness. One generating firm Jindal Tractabel which uses coal and gas gets about 2.60 rupees. Its purchase agreement was not among the 14 and is awaiting regulatory approval. The state wants the Jindal rate to be the benchmark for reopened agreements. If private firms cut capital costs and work out long-term fuel supplies they will be able to cut rates Baligar said. The state says it needs 4000 MW of new capacity over 10 years and 2500 MW over five years. State-run utilities are in a position to meet five-year needs at low rates Baligar said. Asked if Karnataka could face litigation over the reopening of the contracts Baligar had legally strong arguments. ( $1 = 46.9 rupees). Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. INDIA: India utility may slap 4bln rupee fine on Enron unit. 05/22/2001 Reuters English News Service (C) Reuters Limited 2001. BOMBAY May 22 (Reuters) - An Indian utility is planning to impose a second penalty of four billion rupees ($85 million) on Enron's local unit barely a week after the U.S. energy giant took its first step to pull out of the embattled project. A senior official at the Maharashtra State Electricity Board (MSEB) said on Tuesday the fine on Dabhol Power Company (DPC) was for not meeting capacity targets within a stipulated period. We will do this as soon as the bill for May is received next month the official told Reuters. DPC officials declined to comment on the matter. Earlier this year MSEB had imposed a similar penalty on DPC - which DPC has not paid - saying its plant could not be ramped up to full capacity within three hours from a cold start. Enron and MSEB have been battling for six months over payment defaults and last week DPC owned 65 percent by Enron issued a preliminary notice to terminate a power purchase agreement - widely seen as a move that would lead to a pull out. According to DPC it is owed $48 million by MSEB. A top government official told Reuters in Delhi on Monday the federal government is optimistic Houston-based Enron and the Maharashtra state will resolve their wrangle. The agreement signed between MSEB and DPC in 1995 stipulates that if Dabhol's plant cannot achieve 100 percent capacity within three hours from restart MSEB is entitled to impose a penalty. The MSEB official said the plant had failed to fulfil this condition in February and March considered peak periods for power demand by the utility. DPC is building a $2.9 billion 2184 MW plant of which the first phase of 740 MW began operations in May 1999. Enron is India's largest foreign investor. ($1=47.0 Indian rupees). Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. IXEurope creates a Storm in colocation 05/22/2001 M2 Presswire Copyright 2001 M2 Communications Ltd. All Rights Reserved. IXEurope a leading pan-European provider of Internet infrastructure and hosting services today announces that it has signed a deal with Storm Telecommunications Limited (Storm) the international optical switched service provider with an intelligent optical backbone network built in the UK France Germany the Netherlands Denmark Sweden and Norway. Over the coming months Storm's network will also be operational in the USA Switzerland Italy and Austria. Under the agreement Storm will locate its optical switching equipment at IXEurope's flagship datacentres in London and Frankfurt with plans to use other IXDatacentres across Europe for colocation of its equipment to support its European and North American metro access rollout. Storm is the tenth carrier to enter the London city IXDatacentre meaning that IXEurope's customers (including other carriers) will benefit from the services that Storm offers. This illustrates the advantages that IXEurope's carrier-neutral status brings -connectivity cost-effective choice and flexibility. Guy Willner CEO of IXEurope commenting on the deal said: We are pleased to support Storm's IP network rollout. It will naturally interlink with the new gigabit ethernet service we are offering across our pan-European network of IXDataCentres. Mark Stewart senior vice president business development of Storm said We chose IXEurope as one of our colocation partners because of its extensive pan-European presence and the strategic location of its datacentres. IXEurope has ensured that its datacentres are located where there is an abundance of network and provides a choice of carriers which allows us great flexibility. IXEurope will also provide us with the ability to expand over an agreed time scale. IXEurope which now has eight operational datacentres across Europe has recently signed contracts to provide colocation and managed services to Hewlett Packard Enron Broadband Services (EBS) and The Data Company. IXEurope has just been awarded the ISO9002 quality assured certification for the second consecutive year showing its commitment to quality across its European operations. IXEurope IXEurope provides neutral colocation and facilities management services to corporate internet and telecoms organisations allowing them speedier access to market and the freedom to focus on their core business. IXDatacentres are present across Europe in all major business centres including London Paris Frankfurt Zurich Nice Dusseldorf Milan and Barcelona. IXEurope is an ISO9002 Quality Certified Company and a founding member of the Colocation and Hosting Association. IXEurope's funders include Bank of America JPMorgan and European Acquisition Capital. For more information please visit the website at www.ixeurope.com About Storm Telecommunications Storm Telecommunications Limited wholly owned and group operating company of Storm Investments Limited is the first OSP (optical-switched service provider). Storm provides voice bandwidth and IP services and had revenues of GBP52m in 2000. Storm's intelligent mesh network is operational in the UK France Germany Norway Sweden Denmark and the Netherlands shortly reaching the USA Italy Austria and Switzerland. In February 2000 Storm's management completed an MBO backed by investment affiliates of Soros Private Equity Partners and further backing by investment affiliates of Merrill Lynch & Co came in May 2000. Storm's intelligent optical network is in prime position to meet the e-business challenges of 2001 and beyond. For more information please visit HTTP:\\WWW.STORMTEL.COM. ((M2 Communications Ltd disclaims all liability for information provided within M2 PressWIRE. Data prepared by named party/parties. Further information on M2 PressWIRE can be obtained at http://www.presswire.net on the world wide web. Inquiries to info@m2.com)). CONTACT: Victoria Dickson Citigate Technology Tel: +44 (0)207 950 2982 e-mail: Chris Moseley/Vidushi Patel Miller Shandwick Technologies Tel: +44 (0)20 7282 2844 e-mail: cmoseley@miller.shandwick.com e-mail: vpatel@miller.shandwick.com Russell Poole General Manager UK IXEurope e-mail: russell.poole@ixeurope.com Helen O'Hanlon PR Manager Storm Telecommunications e-mail: H.O'Hanlon@stormtel.com Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Power corrupts... 05/22/2001 The Economic Times Copyright (C) 2001 The Economic Times Source: World Reporter (TM) APROPOS of Enrons notice to the government of Maharashtra Mumbai should act pragmatically instead of indulging in heroics and rhetoric. It should set its own house in order improve MSEBs functioning and quickly privatise. If it fails to do these its threat to Enron will also be taken as just another case of demanding kickbacks. IT is sad really that Enron had to issue its pre-termination notice. We should now ask whether MSEB would be able to construct such a project in record time. Corruption is rampant in MSEB. They may say Enron power is not needed but you cannot even get a new connection easily. Interruptions are commonplace in rural areas (sometimes up to four times a week). Power thefts are commonplace too. Each day on average we pay MSEB about Rs 6 per unit for commercial connections. But most people would be willing to pay Rs 7 or so if they got clean uninterrupted power. We have seen for example the vast cost overruns of many of the official water management projects. These overruns go up to 20 times with delays stretching up to 10 years with no guarantee no results even then. All told the government is sending very wrong signals to the international community by raking up the Enron controversy. It should set its own house in order. THE new state ministries are too big in size West Bengals in particular. It has allotted one minister just to deal with fire brigades. The expenditure in lakhs it entails could exceed the total number of fire tenders under the department. Despite that it needed 7 complete days to control a recent fire (with private tankers requisitioned to help over and above the ones owned by the corporation and municipalities). We need more fire tenders not ministers or those who are associated with the big boss. Also we need a new minister plus a full-fledged department to examine corrupt practices in local government and also in the central government offices located in states. Meanwhile was the Sarkaria Commissions recommendation to restrict the size of the ministry to within 10 per cent of the size of the Assembly advanced only to be flouted? We should call a stop to such commissions as not even 10 per cent of their purpose is served they too entail huge establishments which are maintained year after year at taxpayer expense. SINCE 1993 I have been familiar with the political social and business scenarios in the US and so I feel reasonably qualified to make some observations on US immigration policy by Sudhir Shah. Shahs statistics are not totally accurate but they depict the `global picture. The Indian immigrants (a million plus now) are in many respects a class apart. Their education levels are far higher than those of other immigrants many of whom are just a grade above our rag-pickers (they are the cherry and berry pickers on US farms). I have not come across a single uneducated Indian in the US since 1983. Even in asset-formation Indians (even Pakistanis) are leagues ahead of the other immigrants. B T Dasture Mumbai - Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. The Godbole findings Our Editorial 05/22/2001 Business Standard 15 Copyright (c) Business Standard The Godbole committee's first report submitted on 10 April is an eye-opener to what can only be called a massive scandal. It leaves several players MSEB successive Maharashtra governments the Kirit Parikh re-negotiation exercise the Central Electricity Authority and other players in New Delhi with no clothes on. MSEB claimed that it had negotiated a tariff that was lower than would result from applying the central government's standard formula. But this was patently fraudulent because the comparison was based on wrong numbers incorrect technical parameters and unequal assumptions (one rupee-dollar rate for the Dabhol tariff another for calculating the government formula) all of it designed to establish what was not true. Asked in court why there had been no competitive bidding the answer (believe it or not) was that MSEB was not competent to handle competitive bidding. But it was so wonderfully capable of handling direct tariff negotiations that it eventually gave Dabhol a higher tariff than Enron had initially sought before the negotiations began! That's only for starters. There is much more in the Godbole report. On the basis of a passing comment in an FIPB meeting that the project's costs were broadly in line with other similar projects the power secretary in New Delhi tells the Central Electricity Authority that the CEA's techno-economic clearance is not required though this is statutorily mandated. The CEA agrees to this untenable proposition but later issues a vaguely worded clearance on the basis of a meeting whose minutes were not made available to the Godbole committee. The re-gasification project that was made part of the power project had a capacity to handle 5 million tonnes though Dabhol itself needed only 2.1 million tonnes. A port facility had similar excess capacity. Yet the entire cost of these facilities was loaded on to Dabhol along with the full cost of the 20-year gas supply contract. Thus as the Godbole committee observes what should have been a variable cost was converted to part of the fixed cost which MSEB would have to service through a capacity charge whether any power or gas was bought or not. Even the power requirements of Maharashtra were mis-calculated in order to over-ride a warning from the World Bank that the Dabhol power would not be needed. This was done by assuming that industrial demand for power would grow overnight at twice the earlier rate and that MSEB itself would overnight see a dramatic worsening of its operating parameters. There is still more in the report but the point should be obvious. What the report shows is that the Dabhol contract can be subjected to legal test (as in fact two members of the Godbole committee recommend) on the grounds that it was improperly handled and violative of law and common sense. If a favourable judicial decision becomes possible that should help mitigate the costs of winding up a truly scandalous project. For reasons that are not clear MSEB and the Maharashtra government have chosen not to go down this route. Perhaps they have greater and continuing faith in the re-negotiation process. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. SMARTMONEY.COM: Power Grab By Elizabeth Harris 05/21/2001 Dow Jones News Service (Copyright (c) 2001 Dow Jones & Company Inc.) NEW YORK -(Dow Jones)- Feeling squeezed by rising electricity bills and shrinking investment returns? Consider investing in utilities which posted solid gains amid the recent bear-market carnage. But plugging into this volatile sector is risky business as anyone who piled in this year based on energy's surge in 2000 can testify. After returning 7.28% last year as demand for power outstripped supply the average utilities fund is so far down 1% through May 18 according to the fund research firm Morningstar. Though the sector's prospects remain attractive such volatility is par for the course says Mark Beckwith portfolio manager of the Vanguard Utilities Income fund (VGSUX). Utilities and funds that focus on the sector no longer perform like bonds delivering most of the gains via relatively predictable dividend yields. Instead the industry has greater growth prospects (and the correspondingly higher potential for losses) tied to the fluctuating demand for power. Already high prices for natural gas and electricity have created incentives for producers to boost supplies. And the stodgy local monopolies that once dominated the industry must now reckon with a bevy of independent producers distributors and traders. Even telecom companies are now considered fair game offering managers of sector funds fresh choices alongside greater risk. The classification of a utility has changed Beckwith says. At the same time the crisis gripping electricity-starved California is showing other states the pitfalls to avoid as they deregulate their grids. The outlook for wiser deregulation is very much with us says Bill Reaves a manager of the Strong American Utilities fund (SAMUX). The crisis out west has also spurred construction of new power plants from New York to Florida he adds. Managers also count on continued political support from the former oilmen in the White House who are determined to boost domestic output. With such inducements in mind we screened Morningstar's database looking for no-load utilities portfolios with one-year returns of at least 1% and three-year annualized returns of 5% or more. We also sought funds with initial investment minimums no higher than $3000 and expense ratios below the category's average. Strong American Utilities Bill Reaves co-manager of the Strong American Utilities fund characterizes the $290 million portfolio's positions as real utilities. We try to concentrate in the electric and natural-gas area Reaves says. We try to concentrate in holdings and companies where we see good growth. Last year that meant scaling back significantly from telecom stocks in part because of a deteriorating outlook. Right now electric utilities represent 44.5% of the fund - and Dominion Resources (D) is the largest position. Energy ranging from gas utilities to integrated oil and gas companies has also been a significant holding at 24.2%. Reaves and the rest of the portfolio management team are also very sensitive to valuations. The portfolio consists of 40 stocks but the managers can devote up to 75% of the fund's assets to the 16 to 18 companies seen as the best bargains. This cautious approach has stood the fund well at a time when some of its competitors got hit by telecoms' travails. The Strong portfolio rose 27.33% in 2000 and is up 2.42% so far this year contributing to a 15.18% three-year record. Reaves expects the good times to last with industry earnings growth on the order of 8% to 10% coupled with dividends of about 5% over the next three to five years. Demand is likely to keep on being strong...and the value of the service is going to be appreciated a great deal more Reaves says. For example the electric utilities' average price-to-earnings ratio for 2002 is about 12 - roughly a 50% discount to the Standard & Poor's 500 index. The minimum investment is $2500 and the portfolio bears a 1% expense ratio. Vanguard Utilities Income We won't be moving with the Nasdaq says portfolio manager Beckwith of the Vanguard Utilities Income fund he runs. Beckwith invests a relatively small 17% slice of the $900 million fund in telecom stocks. As with the other funds in this screen such caution paid off last year when the fund gained 18.7%. That turned the tables on 1999 when the technology boom consigned Vanguard Utilities to the rear echelon of its peer group. Annualized over three years the portfolio has returned 9.33% trailing the average utilities' fund's 10.53%. Here too the emphasis is on attractive valuations. Beckwith also has a mandate to invest at least 95% of the portfolio in dividend-paying utilities (last year all assets had to be invested in such stocks.) I'm going to get as much growth as I can without taking on too much risk Beckwith says. Right now Beckwith has 61% of his assets in defensive electric utilities such as Dominion Resources or the FPL Group (FPL). The portfolio is down 2.65% so far this year but Beckwith too is counting on continued strong demand for electricity. Earnings momentum will be very good for the group at least over the next year he says. His main concern is that high energy prices could encourage conservation eventually depressing demand. The investment threshold is $3000 and the expense ratio is a slim 0.38%. American Gas Index fund This concentrated portfolio rises and falls with the gas industry's prospects. Strong natural-gas prices boosted the American Gas Index fund's (GASFX) return last year to a 55.86% far above the sector's average. That more than offset the 3.71% drop in 1999. Annualized over three years the roughly $300 million fund has gained 15.82%. Like other index portfolios the fund doesn't make stock picks instead it owns 73 members of the American Gas Association representing much of the gas distribution and transmission industry in most U.S. regions. Stocks are weighted by market-cap and by the portion of a company's assets involved in natural gas. Top holdings include Williams Companies (WMB) Enron (ENE) and Duke Energy (DUK). The initial investment is $2500 and expenses are 0.85%. For more information and analysis of companies and mutual funds visit SmartMoney.com at http://www.smartmoney.com/ Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. Malaysian LNG Sales to India Threatened by Enron Power Dispute 2001-05-22 06:32 (New York) Malaysian LNG Sales to India Threatened by Enron Power Dispute Kuala Lumpur May 22 (Bloomberg) -- Malaysia LNG Tiga Sdn. may have to find new buyers for as much as 2.6 million metric tons a year of liquefied natural gas if Dabhol Power Co. carries through termination of electricity supplies to India's Maharashtra State Electricity Board. MLNG Tiga has an agreement to deliver a maximum 2.6 million tons a year of LNG each year to an import terminal Enron is building to feed the Dabhol power plant. Saturday Dabhol Power 65 percent owned by Enron Corp. of the U.S. started a procedure to end its power supply contract to the electricity board its sole customer which owes over 3 billion Indian rupees ($64 million) in unpaid power bills. ``It is our hope that matters in India would be resolved'' said Azman Ibrahim spokesman for state-owned Petroliam Nasional Bhd. which owns 60 percent of MLNG Tiga. ``If they do not work out we would have to find or make alternative arrangements.'' MLNG Tiga is constructing Malaysia's third gas export facility which will raise the country's LNG capacity to 23 million tons from about 16 million tons in 2000. If Dabhol goes through with cancellation of its power supply contract MLNG Tiga would have to find buyers for more than a third of the 6.8 million tons it is adding to Malaysia's output capacity. Other partners in MLNG Tiga are the Sarawak state government with a 10 percent share Royal Dutch/Shell Group's unit Shell Gas BV with 15 percent Nippon Oil LNG (Netherlands) BV with 10 percent and Diamond Gas Netherlands BV with 5 percent. The plant is due to be completed at the end of 2002 with commercial production due to begin in 2003. India's federal and state governments may have to pay Dabhol Power Co. more than 170 billion rupees ($3.6 billion) if the Enron Corp. unit cancels its 2184 megawatt power venture. LEADER: India unplugged Financial Times May 22 2001 The latest threat from Enron the US energy group to pull out of its Dabhol power plant venture near Bombay illustrates both the shambolic nature of India's electricity system and the wider risks of investing in the country. The project had serious drawbacks. But unless energy companies can expect a commercial return they will not invest in badly needed new infrastructure. Unless contracts are honoured few foreign companies will consider India as a place to do business. The Maharashtra state electricity board the Dabhol plant's only customer is refusing to pay its bills arguing that the tariffs are unjustifiably inflated. Prices are certainly high. The plant fuelled by expensive naphtha is running way below capacity due to unexpectedly low demand further increasing unit costs. More difficult to judge is whether this is within the terms of the contract since Enron is keeping the details confidential. The argument over unit costs though is in any case less relevant than it might seem as most of India's state electricity boards including Maharashtra's operate at a large loss. Many consumers pay highly subsidised rates. Many pay nothing. Bills go uncollected. Half of Delhi's electricity output is stolen mostly to power middle-class air conditioners rather than light bulbs for the poor. Bankrupt state utilities are then periodically bailed out to the detriment of spending on health and education. India's state authorities urgently need to introduce a common minimum tariff and a more targeted form of subsidy. This may be unpopular but the central government's offer of Dollars 5.6bn raised via a bond issue to pay off the electricity boards' debts should sweeten the pill. A new pricing regime is only the first step. Electricity generation transmission and distribution should be unbundled and privatised. Contracts should be awarded through competition not by arrangement with the relevant political party. This would require much more transparency than many of India's politicians have been ready to concede. Enron's difficulties over the Dabhol plant the largest foreign investment in India have persuaded other western companies to withdraw from similar projects. This will hardly help the country to overcome the power shortages that hinder economic development. But the effect will reverberate well beyond the energy sector. India receives a pitifully small slice of the world's foreign direct investment. Infrastructure weaknesses are certainly one factor. But as important is the readiness of Indian politicians to manipulate foreign business for their own ends. Copyright: The Financial Times Limited May 22 2001 Houston Chronicle Enron pulls out of venture drilling in Qatar's waters By LAURA GOLDBERG Copyright 2001 Houston Chronicle Enron Corp. is pulling out of a large natural gas project off Qatar the company said Monday. Plans for the Dolphin project called for Houston-based Enron to work with Elf a subsidiary of France's TotalFinaElf and the United Arab Emirates Offsets Group to develop and pipe natural gas from a block of the Qatar North Field. More than a year ago those involved with the project said it could end up requiring investments of up to $10 billion over six or seven years. Enron said Monday it was transferring its 24.5 percent stake in the project to the United Arab Emirates Offsets Group which said in a news release it had started negotiating with other international players to become stakeholders. With the transfer United Arab Emirates Offsets Group will own 75.5 percent of Dolphin. Terms of the deal weren't released. Enron pulled out for a couple reasons including that it believes there are better places to invest its money said Alex Parsons a company spokesman in London. The project doesn't necessarily fit with Enron's current focus. It is emphasizing businesses such as marketing and trading in wholesale markets such as those for natural gas electricity and broadband. Enron said it would consider future ventures with the United Arab Emirates Offsets Group that were in line with our core business activities. M. Carol Coale an energy analyst with Prudential Securities in Houston said Enron's move is consistent with its exit strategy from international assets that generate low returns. May 22 2001 Houston Chronicle Enron exploring commodity trading Copyright 2001 Houston Chronicle News Services NEW YORK -- Houston-based Enron Corp. the nation's largest natural gas and electricity trading house is looking to continue its expansion into industries beyond energy with a move into the cocoa coffee and sugar businesses industry sources said Monday. Enron has had conversations and interviews with members of the commodity trade in recent weeks using a London-based recruitment firm to help them the sources said. They are definitely interested in getting into the business. Enron has been looking for physical traders. They have some internal people and are looking for lieutenants with experience a cocoa trader said. A representative of Enron's public relations department would only say that the firm is constantly investigating different markets and opportunities. There is always a lot of speculation about what we are doing Habiba Bayi of Enron said Monday. May 22 2001 Houston Chronicle Local and state Plains Resources gets new officers Former executives of Enron and Kinder Morgan are among those chosen for a new slate of officers at Plains Resources an oil and gas exploration and production company that had been sharing management with Plains All American Pipeline. They are filling vacancies created by people who went over to the pipeline side said spokeswoman Carolyn Tice. John T. Raymond who was vice president of corporate development at Kinder Morgan and Kinder Morgan Energy Partners was appointed executive vice president and chief operating officer of Plains Resources. Jere Overdyke Jr. formerly managing director of Enron Global Markets was named executive vice president and chief financial officer. Timothy Stephens formerly chairman president and chief executive of Abacan Resource Corp. was named general counsel and executive vice president-administration. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ISO Market Stabilization Plan Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: 40th Birthday Body:: Thank you...I think jane.m.tholt@enron.com on 06/15/2001 11:36:01 AM To: skean@enron.com cc: Subject: 40th Birthday Hello! jane.m.tholt@enron.com has just sent you an Egreetings.com card! To view your greeting simply click on this pickup window link: If your e-mail doesn't recognize the above address as a link simply copy and paste it in your browser address window. If you need further help visit our Help pages at Your Friends at Egreetings.com What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: confidential ee info Body:: Attached is the spreadsheet for the Houston Commercial Admins. Those in white are slated to recieve offers first. Those in red will only recieve offers if someone on the primary list declines. Please make sure you and the other desk heads are comfortable with the list as it is. I will be at the Houstonian today but Amy Fitzpatrick will be here and can assist you if you need to have a meeting to discuss. Thanks. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: part time/reduced hour employees Body:: ok Cindy Olson 05/08/2001 11:48 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: part time/reduced hour employees Steve I think we have consensus on how we would like the part ttime people handled in the PRS process for mid year.....okay. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ACTION ALERT -- ELECTRONIC MONITORING Body:: I am going to copy Phillippe Bibi (Chief Technology Officer) and Cindy Olson (EVP-HR). Please put someone in touch with Chris. Thanks From: Chris Long 09/12/2000 04:09 PM To: Steven J Kean/NA/Enron@Enron Maureen McVicker/NA/Enron@Enron cc: Subject: ACTION ALERT -- ELECTRONIC MONITORING Steve - Can you please direct me who in Houston should be notified about this legislation...my guess is someone in HR. Thanks - Chris ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CAISO Notice - Comprehensive Market Redesign - Template for Comme nts on Congestion Management Reform Body:: Market Participants: The ISO has posted on its web site a template for your use in submitting your final comments on the ISO's Congestion Management Reform Recommendation that is part of its Comprehensive Market Redesign. The template is posted at . Final comments are due to bwoertz@caiso.com by 5:00 p.m. PDT on Thursday August 31. We will include a summary of all comments received to the ISO Governing Board as part of the CMR Recommendation for their approval. Please note that the template asks you to identify the name of the person submitting comments the name of your organization (please limit comments to one set per organization) and whether you would like to have your comments posted on the ISO web site. Please contact me if you have any questions. Byron Woertz Director Client Relations (916) 608-7066 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FERC INVESTIGATION IN CA - What should they be looking for? Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: UBS deal Body:: Marilyn Yes please call Shirley (3-5290) to setup a meeting. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Moday meeting Body:: Dan Joe and Charles: Let's meet in the hallway 15 minutes before to discuss strategy. Joe we can share a cab. thanks. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Notice Body:: Please call before you leave and please send me your contact information when you have it for your new job. thanks Jane Wilson@ENRON_DEVELOPMENT 05/30/2001 07:31 AM To: Wade Neil Steven J Kean/NA/Enron@Enron cc: Richard Shapiro@Enron Sue Nord@Enron Anthony Duenner@ENRON COMMUNICATIONS Rebecca McDonald/Enron@EnronXGate Sandip Bob Sparger/Corp/Enron@Enron Scott Subject: Notice After almost 13 years with Enron I've decided to pursue other opportunities outside of the company. While the problems in India remain challenging and I have enjoyed my tenure here the job I've been offered is really too good to pass up. Thus please consider this e:mail as formal notice of my intention to resign from the company effective close of business June 16 2001. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Status of Discussions on Electricity Legislation -- No Agreement Reached Body:: Once again today I participated in the discussions on possible electricity legislation held in the offices of Majority Whip Tom DeLay with other interested parties including industry segments public power and state regulators. The other congressional participants were staff to Reps. Steve Largent and Chip Pickering. After meeting all week (except Wednesday) the group was unable to reach an agreement or even a provisional consensus on what could be placed in an electricity title that could be added to the comprehensive energy package that the House Energy and Commerce Committee will begin to process next week. Congressional staff will report to their bosses on the status of the discussions as of this afternoon and from there the Members will determine whether to proceed further. There is a general perception that committee leaders will elect NOT to take up electricty legislation at this time and in the context of the broader package in the absence of broadly supported legislation. In the end the discussions did not bear fruit because divisions remained over the usual issues and along most of the usual fault lines. As the drafts progressed during the week we succeeded in deleting the original language that would have had Congress weigh into the bundled/unbundled and federa/state jurisdictional rules at the very time that likely adverse action in Congress could in turn adversely impact the Supreme Court case. A last minute attempt was made by the congressional staff to stitch together a minimalist electricity title that would have included reliability (with the understanding that the NERC discussions could produce modifications more to our liking) PUHCA repeal PURPA reform interconnection language and federal siting. However in each instance there were one more politically relevant interest groups not willing to go along. Cong. DeLay's staff also tried to link PUHCA repeal to those who had joined an RTO. There was also an attempt to strip it down to reliability interconnection and siting (eminent domain) -- but again there was either disagreement on the details or objection from those who favorite subject was left out of the minimalist package. There was one rather interesting discussion when the public power folks floated language on market power that included a sentence that would have made the filed rate doctrine inapplicable to antitrust challenges to market rates. Needless to say I strongly objected as did EPSA and others. As noted the lack of an agreement reduces our exposure when the mark up occurs. In the absence of an electricity title refund price control and other issues should not be germane to the package that the subcommittee will take up on Tuesday and the full committee next Friday. That package will have five issues addressed: conservation clean coal hyrdo nuclear and reformulated gasoline. Details to follow once legislative language is released. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: RTO Week -- Summary of Standards and Practices Panel Body:: 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= ? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FERC, meeting starts at 10:00 a.m. Body:: Jeff Skilling and Mr. Lay are not going so company plane is not reserved. Bill Butler is going will stay at the Willard What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: LEAK Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: CONFIDENTIAL (The Manifesto) Body:: great idea. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Jolles Body:: I would hold off for now. I think based on our discussion that Ira might be a fit for my organization or EES. Unfortunately I am heading out of town with my family on the 12th (unfortunate for meeting with Ira not unfortunate for me) and EES has new leadership who is trying to assess the state of things before making new senior level hires. So let's wait a bit. Thanks Stelzer@aol.com 03/30/2001 09:58 AM To: skean@enron.com cc: Subject: Jolles Help -- pls help me to unscramble my calendar. We had discussed Ira Jolles now a vp and general counsel of GPU due to resign when its merger is completed and the execs move to some God foresaken place in Ohio or some such state. Ira is smart innovatived honorable very knowledgeable about Pa. Nj NY and Ferc regulation. In short like no other utility executive I have met. He would be perfect for Enron perhaps operating out of one of your offices in one of the states I have mentioned. You said that you would set up meetings with the appropriate people in Houston and I propose April 12 -- I would stay over after our meeting and do the introductions. PLS let me know that this is ok. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: interim emergency approaches.DOC--sent on behalf of Adam Wenner Body:: What about the show cause order route? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Vince I've been hearing rumors that Enron has decided to endorse the nodal pricing model as implemented in PJM. I just wanted to warn you that I'm not sure this is in Enron's long-term interest at all. Let me explain why. Feel free to give me a call if you'd like to talk more about this. First let me say that I firmly believe in locational pricing and specifically pricing congestion. However the way that PJM implements nodal pricing is to eliminate as much price volatility and reduce the transparency of the market. Specifically the PJM tariff gives the ISO the ability to mitigate to cost plus a %10 adder the bids of any market participant that the ISO deems is out of merit in one of the three zones in region. (The fact that a nodal market is talking about zones should give you cause for alarm.) Then the ISO takes this mitigated bid and re-runs its price-setting software to compute new nodal prices. The way I have (somewhat unfairly) decribed this price-setting process is that the PJM ISO decides what prices it would like for a given day and mitigates bids until it gets them. This is not a transparent market nor one where it makes any sense to buy the risk management services that Enron provides. The only price volatility you have to worry about in the PJM market is that kind that comes about if they need imports into their control area to meet demand. Under these circumstances you need to pay the imports whatever is necessary to get them to come to your market. However bear in mind FERC's desire to make a large RTO on the East Coast. This will effectively mean little imports to the East Coast RTO so all bids can be mitigated at the discretion of the ISO. Paying market-clearing prices to cost-of-service mitigated bids is just paying too much to eliminate price volatility. It effectively kills off the development of risk management at the wholesale and retail level. Power marketing becomes much less profitable because retailers know you can always buy at cost-mitigated prices. In short the PJM model is not market. It is just an alternative form of regulation that is politically attractive because it reduces price volatility but it is not good for consumers or traders because they just get a higher cost form of regulation than traditional cost-of-service regulation. You pay market-clearing prices to cost-of-service mitigated bids but under regulation you could just pay cost-of-service prices and eliminate the infra-marginal profits to low cost generators. As we discussed during our dinner I think the two biggest sources of benefits from re-structuring will come from getting the demand-side involved in the market and from more efficient risk management. A necessary condition for both of these to occur is prices that reflect actual conditions in the market (including the extent of market power exercised). Masking these signals dulls any incentive for market participants to make the investment necessary to management. The PJM model is just way to have a market in name without achieving any significant benefits to consumers or energy traders. Frank What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Thu evening Body:: Thanks. Confirmed. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Comments On Draft RTO Letter On Barton Proposal Body:: Following up on last night's e-mail here are some specific suggestions to strengthen the draft EPSA letter on the Barton RTO draft. The second paragraph and the first few bullets after it should be rewritten as follows to make it clear that the current legislative proposal on RTOs is far off the mark as opposed to being fixed by technical corrections as the draft letter now states: You have identified RTOs as critical to the development of a well-functioning transmission system and we wholeheartedly agree. We commend you for including all transmission-owning utilities in the RTO provisions and for requiring that transmission be conducted on an open-access basis. However to accomplish the RTO and transmission goals we share it is essential that any legislation on RTOs not slow down the process already underway at FERC. Unfortunately the discussion draft as issued on October 9th does not meet this test. Specifically the proposal Establishes a lengthy and cumbersome process that will delay the formation of RTOs by imposing procedural requirements that advantage those who oppose properly functioning RTOs including evidentiary hearings and court appeals review under standards of judicial review not normally applicable to Federal Power Act cases. Removes the ability of the Federal Energy Regulatory Commission (FERC) to deal with an evolving marketplace by statutorily freezing market and operational structures in place as of date of enactment regardless of changed circumstances. [rest of the bullets as in the draft letter] We appreciate the opportunity to offer these suggestions to strengthen the draft letter. Please call with any questions or comments before the Legislative Affairs Committee meeting tomorrow. Thanks. John What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Stand-alone Reliability Legislation Body:: I believe it is timely to discuss this again and I agree with Cynthia that stand alone legislation does nothing to address the essential transmission structural issues. I am open minded on the issue if someone can make a compelling case to support stand alone legislation BUT my gut reaction is that it would be a serious mistake. Congress would happily put off dealing with this issue for years if it passes reliability only legislation. I think the legislation itself makes little or no progress on our issues and may even set us back on making progress at FERC and in other fora. I realize that if this gets going it may be hard to stop but it would be such a cynically ineffective approach to the real reliability problems that we should help whomever we can to put a stop to it. If it gets through committee I have no confidence in this Congress to actually amend it into something better and broader so again I have difficulty seeing why we should go that route. I look forward to the discussion. Cynthia Sandherr@ENRON 07/17/2000 02:20 PM To: Joe Hartsoe/Corp/Enron@ENRON I cc: Richard Shapiro/HOU/EES@EES Steven J Kean/HOU/EES@EES dwatkiss@bracepatt.com cingebretson@bracepatt.com Joe Hillings/Corp/Enron@ENRON ed@buckham.com Jeff Brown/HOU/EES@EES Subject: Re: Stand-alone Reliability Legislation Joe: thanks. Allison is arranging a brief (thirty minutes) Conference Call for sometime tomorrow so we can assure that we are all on the same page on this issue. Although we had supported the policy agreement we had been on record to oppose for political reasons the bill's movement on a stand-alone basis since policing the grid does nothing to address the essential transmission structural changes the market is crying to have addressed in order to provide reliability. However given Jeff Brown's efforts the political need for inoculation and other political developments it is timely to once again discuss Enron's position. I look forward to our call sometime tomorrow. Cynthia Joe Hartsoe 07/17/2000 03:09 PM To: Richard Shapiro/HOU/EES@EES Cynthia Sandherr/Corp/Enron@ENRON cc: Subject: Stand-alone Reliability Legislation FYI. Thoughts? JOE ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: SRP Change in Business Practice at Palo Verde Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL - DO NOT DISTRIBUTE Body:: CONFIDENTIAL - DO NOT DISTRIBUTE Steve Kean would like your comments on this email as soon as possible. Thanks. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Tokyo Presentation 15 May Body:: The presentation looks fine but consider adding this idea in a few slides: the continuation of a regulated structure poses considerable risk for utilities. California's utilities were pushed to the brink of or into bankruptcy because of a regualtory regime which allocated price risk to them. All parties are better off in a system where the regulated enterprise is limited to natural monopoly functions and all other acitivities are conducted in a marketplace. Also did we cover the shortcomings of the Japanese market sufficiently? What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Senate Energy Hearing Today Body:: The Senate Energy Committee held an oversight hearing today on siting impediments to energy infrastructure. The four witnesses were Jerry Halvorsen of INGAA William Nugent of Maine for NARUC David Cook general counsel of NERC and Stan Szwed vp-transmission of FirstEnergy Corp. The hearing was well attended by committee Republicans but only Sen. Bingaman and Sen. Landrieu on the Democratic side and then only briefly. Highlights NARUC's Nugent urged the Committee to move swiftly to confirm Wood and Brownell to FERC noting their confirmation hearing is tomorrow. Consensus that energy infrastructure is not able to keep up with projected energy demand both gas and electric. Surprising willingness (even among western Republican senators who are normally pro-states rights pro-private property rights) that Congress should at least seriously consider if not implement some form of federal authority over power transmission siting. Specifics were not nailed down with some senators expressing more support for treating electric like FERC already has power over natural gas while others were inclined more toward a FERC back stop or last resort authority when state decisionmaking breaks down. The drift was certainly toward some enhanced federal role. NERC released is Summer Assessment today that is more pessimistic than California ISO on the extent of expected rolling blackouts and shortages this summer. NERC seees a capacity shortage in the Pacific Northwest this winter. While NY/NE is adequate this summer Cook says it bears watching because of bouts of high heat in the region and a high level of unplanned outages that often occur in the region in the summer. Chairman Murkowski engaged in a series of questions with INGAA's Halvorsen designed to lay the blame for the natural gas capacity problem to California and corresponding high price levels on the actions of LDCs in California not supporting expansion of interstate pipelines. Halvorsen's testimony includes a chart of specific cases where LDCs intervened. In his verbal testimony Halvorsen singled out Sempra as a source of opposition including Sempra filings against expansions by Transwestern and Kern River. Chairman Murkowski got Halvorsen to say that the actions of the California LDCs and the intrastate nature of all gas pipelines in California effectively denied California consumers the benefit of open access for natural gas. Murkowski implied he would entertain a change in the Natural Gas Act as it relates to the status of interstate pipelines going in to California. Sen. Domenici joined the increasing chorus of members of Congress raising questions about why natural gas prices are low at the wellhead for his producers in New Mexico but so high into California. He asked the panel who is making the money in the differential but none of the witnesses wanted to tackle the question. This is just one more indication of the growing interest in the natural gas aspects of the California situation. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: There were several items in the mail pouch that you needed a response form me on. Here are the responses: Marchris forwarded a request to attend a conference on Aug 19 and 20. I think the original invite when to Ken and Jeff. I will attend subject to them getting some reasonable response rate from the commissioners they invited and provided that I get a speaking or similar participation opportunity. SMU professor and student asking for Astros tickets - yes CERA conference on July 10-12 in Scotland -- decline What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Dadisms Body:: George Herbert Hoover Bush. Robert Kean on 07/07/2001 10:13:19 AM Please respond to To: Alan Kean \(E-mail\) 'Doug & Karen Reiman \(E-mail\)' Kathy Wedig \(E-mail\) Melissa Kean \(E-mail\) Phil Kean \(E-mail\) 'Steve & Melissa Kean \(E-mail\)' cc: Diane Kean \(E-mail 2\) Subject: FW: Dadisms Dadisms 1. Run for the roundhouse Nellie he'll never corner you there. 2. Slick as catshit and twice as nasty. 3. Like shit through a goose. 4. Yeah that's right keep fiddlin' with that you'll break it 5. Ho! Ho! she cried in excess wild and waved her wooden leg on high! 6. On accounta the war. 7. They'll have to shoot him on judgement day. 8. Then of course there are the names: Katy Devie My Little Mochawk Phil Jofus and Bubba 9. Choke ass (referring to peanut butter) 10. If it tastes good there are no calories 11. Didn't know you were in town (as driver passes on the right etc.) 12. Like a couple of cub bears (meaning Rob and Phil) 13. Washington D.C. District or Corruption 14. Have some onions for defense 15. He won't have the guts to do THAT again (when a bug hits the windshield) 16. Saps goin' up the tree 17. Big Al 18. Douglas Doorite 19. Must be a storm comin' the kids are actin' up 20. Constipate (concentrate) 21. Like being in hell with your back broke 22. gourd cover (hat) 23. mitts dogs paws (hands or feet) 24. you're too young 25. Worthington (when we asked him where something was or where he was going) 26. overhose (blue jeans) 27. excruciating pain! (when we squeezed his hand) 28. That's a hell of a note 29. meat wagon (ambulance) 30. drappies (drapes) 31. grappies (grapes) 32. Whoa horsie! Just cuz you only got 3 legs. (when he was putting on the brakes in the car) 33. Jeana Jeana corpastina I'm in love with you 34. I love you anyway 35. Scuse my boardin' house reach. 36. Come on out and let me lay a wheel on ya! (in traffic) 37. Sit down and start passin' (at meal time) 38. That's a bit of all right. 39. Here guard this with your life (when he handed something to us at a store) 40. SOL (shit out of luck) 41. I'll tell ya when your're 21. 42. fernilla dawberry shocoletta (vanilla strawberry chocolate) 43. straighten up now. 44. Pardon me soldier. (when he burped) 45. I'm going to assume the position of a soldier. (when he was going to lay on the couch for a nap) 46. horses doovers 47. lemon meringoo pie 48. solft 49. go ahead see if it bends (when someone pulled out in front of him) 50. Ioway State 51. Cedar Rapids Cedar Rapids come on down. Hotel Roosevelt center of town. 52. A hundred dogs going wild in the tobacco field. Does your cigarette taste difference? (a quote from the one Russian guy in Cascade) 53. Cut her loose and let her wander. 54. Get your dogs under the table. 55. Shit! cried the queen and a thousand loyal subjects strained their bowels. 56. Who's side are you on?! The power company? (when we left lights on) 57. That makes it soggy and hard to light 58. Full as a tick 59. A treat instead of a treatment 60. Intermittent Power What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Bush IT National Steering Committee, Invitation Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential communications Body:: J.C. asked that I send you the following message: In light of rumors that investigations into Enron's financial difficulties may be launched or expanded including investigations by the civil plaintiffs or by the FBI on behalf of the SEC or Congress we believe it prudent to advise you that if anyone contacts you and seeks to question you (even someone with a badge and an authoritative demeanor) don't answer their questions. Refer them to us for the purpose of arranging an interview. Second if you know of any individuals who you believe might be interviewed in connection with these investigations please call us so we can discuss how such information should be forwarded to the appropriate people. Please call if you have any questions. This e-mail and any attached files may be confidential and subject to attorney/client privilege. If you received it in error please immediately notify the sender by return e-mail or by calling (713)654-7600. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Trip to Santa Fe & California Body:: Liz Frank Wolak can meet Greg and me in his office and for dinner Thursday night August 16 at Stanford. Can Greg fly to San Francisco or San Jose from his Asset Tour trip in late afternoon on that day? If Greg can get a co plane to go San Francisco on Thursday we could fly together to Santa Fe on Friday morning August 17. Norman Packard can meet us on that day. I could go to San Francisco Thursday morning on a commercial flight. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Dadisms Body:: George Herbert Hoover Bush. Robert Kean on 07/07/2001 10:13:19 AM Please respond to To: Alan Kean \(E-mail\) 'Doug & Karen Reiman \(E-mail\)' Kathy Wedig \(E-mail\) Melissa Kean \(E-mail\) Phil Kean \(E-mail\) 'Steve & Melissa Kean \(E-mail\)' cc: Diane Kean \(E-mail 2\) Subject: FW: Dadisms Dadisms 1. Run for the roundhouse Nellie he'll never corner you there. 2. Slick as catshit and twice as nasty. 3. Like shit through a goose. 4. Yeah that's right keep fiddlin' with that you'll break it 5. Ho! Ho! she cried in excess wild and waved her wooden leg on high! 6. On accounta the war. 7. They'll have to shoot him on judgement day. 8. Then of course there are the names: Katy Devie My Little Mochawk Phil Jofus and Bubba 9. Choke ass (referring to peanut butter) 10. If it tastes good there are no calories 11. Didn't know you were in town (as driver passes on the right etc.) 12. Like a couple of cub bears (meaning Rob and Phil) 13. Washington D.C. District or Corruption 14. Have some onions for defense 15. He won't have the guts to do THAT again (when a bug hits the windshield) 16. Saps goin' up the tree 17. Big Al 18. Douglas Doorite 19. Must be a storm comin' the kids are actin' up 20. Constipate (concentrate) 21. Like being in hell with your back broke 22. gourd cover (hat) 23. mitts dogs paws (hands or feet) 24. you're too young 25. Worthington (when we asked him where something was or where he was going) 26. overhose (blue jeans) 27. excruciating pain! (when we squeezed his hand) 28. That's a hell of a note 29. meat wagon (ambulance) 30. drappies (drapes) 31. grappies (grapes) 32. Whoa horsie! Just cuz you only got 3 legs. (when he was putting on the brakes in the car) 33. Jeana Jeana corpastina I'm in love with you 34. I love you anyway 35. Scuse my boardin' house reach. 36. Come on out and let me lay a wheel on ya! (in traffic) 37. Sit down and start passin' (at meal time) 38. That's a bit of all right. 39. Here guard this with your life (when he handed something to us at a store) 40. SOL (shit out of luck) 41. I'll tell ya when your're 21. 42. fernilla dawberry shocoletta (vanilla strawberry chocolate) 43. straighten up now. 44. Pardon me soldier. (when he burped) 45. I'm going to assume the position of a soldier. (when he was going to lay on the couch for a nap) 46. horses doovers 47. lemon meringoo pie 48. solft 49. go ahead see if it bends (when someone pulled out in front of him) 50. Ioway State 51. Cedar Rapids Cedar Rapids come on down. Hotel Roosevelt center of town. 52. A hundred dogs going wild in the tobacco field. Does your cigarette taste difference? (a quote from the one Russian guy in Cascade) 53. Cut her loose and let her wander. 54. Get your dogs under the table. 55. Shit! cried the queen and a thousand loyal subjects strained their bowels. 56. Who's side are you on?! The power company? (when we left lights on) 57. That makes it soggy and hard to light 58. Full as a tick 59. A treat instead of a treatment 60. Intermittent Power What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Vacation Time Body:: Maureen No problem. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FERC INVESTIGATION IN CA - What should they be looking for? Body:: Looks like you got this earlier. I think it has new relevance in light of FERC's announced investigation. ------------ What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Starwood Draft Body:: A bit lengthy but I think it looks fine. Peggy Mahoney@EES 08/30/2000 12:41 PM To: Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Mark Koenig/Corp/Enron@ENRON Paula Rieker/Corp/Enron@ENRON Cedric Burgher/Corp/Enron@ENRON Elizabeth Tilney/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Jeremy Blachman/HOU/EES@EES Mark S Muller/HOU/EES@EES Kevin Hughes/HOU/EES@EES Dan Leff/HOU/EES@EES NotesAdmin/EES@EES Marty Sunde/HOU/EES@EES Vicki Sharp/HOU/EES@EES Bill Rapp/HOU/EES@EES Rob Rice/HOU/EES@EES Wendy Raleigh/HOU/EES@EES cc: Karen S Owens@ees@EES Thomas E White/HOU/EES@EES Subject: Starwood Draft Attached is a draft of the Starwood press release with our initial changes in red. Please review and let me know your thoughts by end of day Thursday Aug 31. It is clear that Starwood has several agendas with this release and after talking with them they would prefer not to cut any of their messages. Scheduled release date is Tuesday Sept 5. Please feel free to call me to discuss. Also - I've attached a map of all their US owned franchised and leased property locations. 87 of the properties are owned and there are approx. 400 total in the US. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Bay City News Wed 3/21: Blackouts Not Expected=20 Today Dow Jones Newswire Wed 3/21: Calif State Controller:General Fund Surplus = Dn=20 To $3.2B CBS.MarketWatch.com Wed 3/21: Davis says regulators will act to pay QFs Electricity providers insist they need to be paid Long Beach Press Wed 3/21: Rash power bill may need fix SF Chron Wed 3/21: PUC considers rewarding producers that sign long-term= =20 contracts Sac Bee Thurs 3/22: State claims $5.5 billion overcharge: Refunds by=20 wholesale generators sought Sac Bee Thurs 3/22: Power solution eludes Davis: Lawmakers grow edgy as= =20 crisis drags on Sac Bee Thurs. 3/22: Legislators learn some details of power contracts= San Diego Union Thurs 3/22: Federal judge orders major power wholesaler= =20 to sell to California San Diego Union Thurs. 3/22: Controller: State's power spending imperil= s=20 its financial health San Diego Union Wed 3/21: Governor says utilities must pay in advance f= or=20 some power LA Times Thurs 3/22: Energy Overcharge of $5.5 Billion Is Alleged LA Times Thurs 3/22: Power Strain Eases but Concerns Mount LA Times Thurs 3/22: Graphics: Overcharges Alleged=20 San Fran Chron Thurs 3/22: Net Complex A Dilemma For San Jose=20 SERVER FARM: Plant would tax grid San Fran Chron Thurs 3/22: Contracts Won't Meet Summer Demands=20 DETAILS: 2004 before full impact felt Mercury News Thurs 3/22: California overcharged $5.5 bln for wholesale= =20 power Orange Cty Register Thurs 3/22: Commentary: If the Power Goes Off =20 Orange Cty Register Thurs 3/22: Commentary: Socialized Electricity San Fran Chron Thurs 3/22: Bush's Energy Policy Will Backfire=20 Feinstein Warns / She wants federal price controls now Dow Jones Newswires Thurs 3/22: Reliant Still In Power Pact Talks With= =20 Calif. DWR Dow Jones Newswires Thurs 3/22: CPUC Must Address Rates In QF Repayment= =20 Order - SoCal Ed Dow Jones Newswires Thurs 3/22: Calif Small Pwr Producers To Shut Plant= s=20 If Rates Capped --- --- Blackouts Not Expected=20 Today Bay City News=20 Following two consecutive days of rolling blackouts California's power=20 picture looks much brighter today but conservation is still needed.=20 The California Independent System Operator is urging consumers to continue= =20 conservation measures during today's Stage One Electrical Emergency.=20 The conservation efforts of Californians particularly Tuesday evening we= re=20 significant and helped to reduce the duration and impact of yesterday's=20 blackouts'' according to officials. The California ISO asks customers to= =20 continue their voluntary reductions during this time of tight supply.=20 More than 11500 megawatts of in-state generation remain unavailable with= =20 power plants completing repairs and needed maintenance. However several=20 generating units returned to service today and the level of imported power= =20 has increased boosting the supply.=20 The ISO is cautiously optimistic that customer outages will be avoided=20 today'' according to officials.=20 Today's Stage One alert is in effect through midnight tonight.=20 Stage One Emergencies are declared when power reserves fall below 7 percent= .=20 Stage Two kicks in when reserves fall below 5 percent. Stage Three is=20 initiated when reserves drop to below 1.5 percent. --- Calif State Controller:General Fund Surplus Dn To $3.2B 03/21/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LOS ANGELES -(Dow Jones)- California State Controller Kathleen Connell=20 Wednesday said the state's general fund surplus has dropped to $3.2 billion= =20 from $8.5 billion in January mostly because of electricity purchases made = by=20 the state's Department of Water Resources a press release said.=20 Connell also denied Gov. Gray Davis' request to transfer an additional $5.6= =20 billion from the general fund to the Special Fund for Economic Uncertaintie= s=20 the release said. Connell noted that given the rapid depletion of the general fund on power= =20 purchases the state would need to borrow $2.4 billion in order to tranfer= =20 the $5.6 billion from the general fund to the special fund.=20 We started this year with a generous budget surplus. The energy crisis has= =20 taken much of that away and this transfer on top of the electricity=20 purchases would put the fund at risk Connell said.=20 Connell called on Davis to ensure that the CDWR completes by the end of May= =20 2001 the revenue bond sales that will be used to buy power and repay the=20 general fund.=20 She also asked that the CDWR notify her of all power purchases made and=20 contracts negotiated thus far and requested that she be told within 7 days = of=20 any purchases and contracts negotiated in the future.=20 Connell also said she wanted to be told within 24 hours of any power buys= =20 that exceed $55 million and asked that the Department of Finance be directe= d=20 to prepare new general fund cash flow estimates for the next 30 and 60 days= =20 and for the end of the fiscal year.=20 The state's Department of Water Resources has been buying power since Janua= ry=20 in lieu of Edison International (EIX) utility Southern California Edison an= d=20 PG&E Corp (PCG) utility Pacific Gas and Electric Co because suppliers=20 refused to sell to the nearly-bankrupt utilities.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 Gov. Davis' office said in response to Connell's comments that the state= =20 budget was solid and the economy remained strong.=20 We will be getting the money back we've paid for energy and it should have= =20 no significant effect on the state's finances from the Wall Street=20 perspective said Davis press secretary Steve Maviglio.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 jessicaberthold@dowjones.com --- -------- Davis says regulators will act to pay QFs Electricity providers insist they need to be paid By Russ Britt CBS.MarketWatch.com=20 Last Update: 9:45 PM ET Mar 20 2001 LOS ANGELES (CBS.MW) - California Gov. Gray Davis said regulators will act= =20 Tuesday on a plan to guarantee that independent power generators are paid. Independent power producers provide about 30 percent of California's=20 electricity from a variety of sources including wind solar and other=20 sources. Because many of the companies known as Qualifying Facilities or= =20 QFs haven't been paid they've begun to withhold power contributing to=20 blackouts in the state Monday and Tuesday.=20 We are anxious to pay the QFs because they're falling like flies Davis= =20 said at a news conference late Tuesday. If they don't get paid the lights= =20 will go out. Davis said the state's PUC order will require the state's nearly bankrupt= =20 utilities to enter five-year contracts with the QFs at rates of 7.9 cents p= er=20 kilowatt hour or 10-year contracts for lower rates. The structure is simil= ar=20 to rates Davis claims he was able to negotiate for long-term power contract= s=20 from out-of-state generators. --- Rash power bill may need fix By Will Shuck From our Sacramento Bureau SACRAMENTO Even as lawmakers lament the slow pace of solving California's= =20 energy crisis the cost of haste has cropped up in their first major act a= =20 multibillion dollar measure that put the state in the power-buying business= .=20 AB1X the highly touted bill that put California in the power-buying=20 business may have been so rashly crafted that it will take another piece o= f=20 legislation to fix it an influential senator said Tuesday.=20 At issue is vague wording that makes it unclear when and to what extent=20 Southern California Edison and other utilities have to repay the state for= =20 buying power.=20 State Sen. Debra Bowen chairwoman of the Senate Energy Utilities and=20 Communications Committee said the bill apparently has left room for utilit= y=20 lawyers to argue that their companies needn't repay the state until they ha= ve=20 covered other costs.=20 But Bowen a Redondo Beach Democrat who represents downtown and western Lon= g=20 Beach said the legislative intent is crystal clear that the state wanted= =20 to be repaid directly for supplying about a third of the power utility=20 companies deliver to their customers.=20 We need a cleanup bill to set the matter straight she said.=20 Although AB1X illustrates the flaws that come with speed Bowen said the= =20 Legislature can't afford to delay.=20 I think we are much too slow in our response she said. But that has to = be=20 balanced against things we've done in a tearing hurry and then have had to= =20 fix later.=20 No matter what the Legislature does in the coming weeks she said Californ= ia=20 is in for a tough summer and only determined conservation efforts will put= =20 much of a dent in a precarious supply-demand equation. --- PUC considers rewarding producers that sign long-term contracts=20 Greg Lucas Lynda Gledhill Chronicle Sacramento Bureau Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 Sacramento -- Some cash-strapped producers of wind solar and other=20 alternative forms of energy will get long-delayed financial relief under a= =20 proposed order by state regulators Gov. Gray Davis said yesterday evening.= =20 A proposed order by the Public Utilities Commission is designed to reward= =20 energy producers who sign long-term contracts with utilities at lower rates= .=20 Alternative energy producers that voluntarily enter such contracts which= =20 would start on April 1 would be paid within 15 days said Davis who=20 requested the order. Those that do not would have to wait until the utiliti= es=20 that buy their power return to solvency.=20 Davis blasted Pacific Gas & Electric Co. and Southern California Edison for= =20 not paying the alternative generators -- know as qualified facilities or= =20 QFs -- even though the companies have been collecting money through rates= .=20 It is wrong and irresponsible of the utilities to pocket and withhold the= =20 money designed to compensate the QFs Davis said. It's immoral and has to= =20 stop.=20 Alternative producers -- ranging from massive co-generation facilities at o= il=20 refineries to tiny biomass plants -- produce about a third of the state's= =20 supply of electricity. But many are shutting down because utilities have no= t=20 paid them since November.=20 The loss of some 3000 megawatts from tapped-out alternative energy produce= rs=20 contributed to the blackouts that snarled California yesterday and Monday= =20 according to the Independent System Operator which manages the state's pow= er=20 grid.=20 The PUC's proposed order -- which will be considered at the board's Tuesday= =20 meeting -- offers the generators a choice of agreeing to a five-year contra= ct=20 at $79 per megawatt or a 10-year deal at $69 per megawatt Davis said.=20 The order does not address the more than $1 billion already owed to the mor= e=20 than 600 alternative energy producers around the state. Davis said to favor= =20 one creditor over another in past debt could bring on bankruptcy proceeding= s=20 from other creditors.=20 The Legislature would also need to act to make the order work.=20 It is critical to keep these facilities up and online said Sen. Debra=20 Bowen D-Marina del Ray who estimates that Edison has $1.5 billion in cash= =20 on hand and PG&E $2.5 billion. The utilities owe it to the people of the= =20 state to pay them.=20 Edison said yesterday that it opposed any attempt to place alternative=20 producers ahead of their other creditors.=20 But Tom Higgins a senior vice president for Edison International which ow= es=20 alternative producers some $835 million said his company was talking to th= e=20 governor's office about possible payment structures.=20 Alternative energy producers particularly those that use high-priced natur= al=20 gas to fire their generators say that without an immediate infusion of cas= h=20 they must close their plants.=20 We've been obsessed with the health of the utilities and (have) forgotten= =20 the health of everyone else said V. John White legislative director of t= he=20 Clean Power Campaign which lobbies for alternative energy producers.=20 CalEnergy Operating Corp. which operates eight geothermal plants in the=20 Imperial Valley producing 268 megawatt hours for Edison has sued the utilit= y=20 asking to be paid and to be temporarily released from their contract with= =20 Edison which has paid them nothing since November.=20 CalEnergy has a court hearing tomorrow on its Edison contract. Edison owes= =20 the company $75 million and the debt increases by $1 million a day.=20 We've lived up to our end of the bargain but Edison hasn't. We're now not = in=20 a position to make a property tax payment on April 10 and we're the largest= =20 employer in the county said Vince Signorotti CalEnergy's property manage= r.=20 Unlike Edison PG&E is paying its creditors 15 cents on the dollar.=20 We have offered over the past five days to prepay for future power not yet= =20 delivered to keep as many of them operating as possible but the state need= s=20 to decide how its going to divvy up the limited money under the frozen=20 rates said John Nelson a PG&E spokesman.=20 The PUC's sudden attempt to recast the rates paid to alternative generators= =20 comes after several months of inaction partly a result of waiting for=20 legislative negotiations on the issue to conclude. Those negotiations=20 eventually failed to move forward.=20 --- State claims $5.5 billion overcharge: Refunds by wholesale generators sough= t By Dale Kasler Bee Staff Writer (Published March 22 2001)=20 In its boldest attempt yet to extract refunds from wholesale power=20 generators the state's grid operator accused the generators Wednesday of= =20 overcharging Californians by $5.5 billion for electricity since last May.= =20 The state's Independent System Operator which manages the state's=20 transmission grid plans to tell a federal regulatory agency today that pow= er=20 generators consistently took advantage of their stranglehold on the=20 California market to ratchet up prices.=20 The federal agency the Federal Energy Regulatory Commission recently=20 threatened to order generators to refund $134.8 million for overcharges=20 mostly covering January and February. But those refunds amounted to just a= =20 fraction of what the grid operator was seeking. The ISO which has been=20 complaining about market abuses for several months says FERC must do more.= =20 We're happy that (FERC) took this first step but we think there's a long= =20 way to go said Anjali Sheffrin the ISO's director of market analysis. A= s=20 far as I'm concerned it's been too little too late. ... The refunds they= =20 have acted on (so far) have been minimal.=20 She said the report covers five major power suppliers and 16 other power=20 importers.=20 FERC Commissioner William L. Massey said it would be improper for him to=20 comment on a report that has not yet been filed. But when told of the $5.5= =20 billion total Massey told the Los Angeles Times: That doesn't shock me in= =20 any way.=20 Prices over the past 10 months in California have greatly exceeded the=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said.=20 However most FERC critics are skeptical that the federal agency which is = a=20 strong believer in letting free markets run their course would order a=20 refund anywhere near as large as $5.5 billion -- even though it has found= =20 that California prices at times have been unjust and unreasonable.=20 The big power generators saying their charges were reasonable are disputi= ng=20 the $134.8 million refunds proposed so far and have vowed to fight the ISO'= s=20 latest effort.=20 If the ISO were to prevail the $5.5 billion in refunds could go a long way= =20 toward remedying California's energy mess.=20 They could help restore the financial health of Pacific Gas and Electric Co= .=20 and Southern California Edison which have nearly been bankrupted by the=20 prices charged by the power generators. They also could ease the strain on= =20 the state treasury which is spending billions to purchase electricity for= =20 Californians because PG&E and Edison can't.=20 Sheffrin said her department studied sales made by the power generators to= =20 ISO which makes last-minute power purchases to balance supply with demand= =20 and the California Power Exchange the now-bankrupt entity where most of=20 California's wholesale electricity was bought and sold until December.=20 She said the study made very generous allowances for natural gas expenses= =20 costly air-pollution credits and other factors including the scarcity of= =20 electricity. The result was $5.5 billion worth of charges in excess of=20 competitive costs she said.=20 In many cases the companies used their market clout to submit bids that we= re=20 way beyond their costs she said.=20 It was insufficient competition Sheffrin said. They got away with a lot= .=20 She said the refund request isn't just a shot in the dark. FERC she noted= =20 has already found that prices in the California wholesale energy market ha= ve=20 been unreasonable. We took it upon ourselves ... to show FERC how they got = to=20 be so high.=20 FERC proposed refunds totaling $124 million for January and February sales= =20 declaring that generators' prices were too high.=20 In a separate case the federal agency for the first time accused two=20 generators last week of taking plants offline to force prices up.=20 --- Power solution eludes Davis: Lawmakers grow edgy as crisis drags on=20 By Emily Bazar and Amy Chance Bee Capitol Bureau (Published March 22 2001)=20 Gov. Gray Davis likes to compare the state's energy crisis to a complicated= =20 three-cornered billiard shot.=20 But as California plunged into another round of power blackouts this week= =20 Davis has yet to line up the angle on an ultimate solution.=20 The state's short-term power bill is nearing $4.2 billion and legislators= =20 are balking at the administration's requests for additional money.=20 Getting even the least controversial pieces of the puzzle through the=20 Legislature is taking weeks longer than expected.=20 While the Democratic governor has insisted secrecy about details of his pow= er=20 purchases is necessary to protect the state's bargaining position other=20 state officials are complaining vigorously about the lack of information.= =20 And critical deals the governor hoped to reach with energy suppliers and=20 utility companies are proving difficult to close.=20 I think we all got lulled into a little complacency a few weeks ago. All= =20 these things seemed to be going along and the governor was making all thes= e=20 warm and fuzzy comments said Assemblyman John Campbell R-Irvine.=20 But it only takes one deal to go sideways and we're all blacked out he= =20 added. The governor is running around basically saying 'Trust me.' I'm no= t=20 sure he's deserving of the trust at this point.=20 Davis and his aides insist they are working around the clock on plans to=20 boost power generation encourage conservation and reach an agreement with= =20 utilities that will keep them out of bankruptcy.=20 The utility plan they say is the equivalent of a large corporate merger= =20 that simply can't be accomplished overnight. Davis notes that earlier=20 deregulation efforts might have benefitted from a little more time.=20 Although the state has reached a broad agreement in principle with Southe= rn=20 California Edison to obtain its power transmission lines in exchange for he= lp=20 paying off its debts a final detailed deal has not been reached. The=20 initial agreement with Edison was announced Feb. 23.=20 And the governor has yet to achieve a tentative agreement with Pacific Gas= =20 and Electric Co. which is driving a harder bargain over price and other=20 elements of a potential rescue plan.=20 Joseph Fichera one of several consultants receiving more than $11 million= =20 from the administration for advice on the energy crisis said many people= =20 don't realize the complexity of the deal they're brokering.=20 In their bid to achieve a public takeover of the investor-owned utilities'= =20 transmission lines he said negotiators have to pore over thousands of=20 documents related to the transmission lines alone.=20 We are doing what is normal in a transaction of this magnitude which is= =20 investigate document circulate redocument agree move forward said=20 Fichera an investment banker with Saber Partners in New York City. The=20 governor has put a 'I want this yesterday' fire under his negotiating team= .=20 The negotiator however declined to say when he expects final agreements t= o=20 be reached with the companies.=20 It could be days it could be weeks he said.=20 There were signs meanwhile of trouble brewing on another front: the giant= =20 bond sale the state must make to repay the money it has spent so far on=20 electricity and to finance future long-term contracts for energy.=20 State Treasurer Phil Angelides said Wednesday the utilities are appealing a= =20 ruling by the state Public Utilities Commission that essentially ensures th= e=20 state will be repaid a move that he said threatens to delay the sale=20 indefinitely.=20 If the utilities have decided to adopt a scorched earth policy until they= =20 get what they need and want then it will be a significant problem=20 Angelides said.=20 PG&E spokesman Ron Low said the governor is simply placing too many demands= =20 on a rate structure that doesn't compensate the utilities for their current= =20 costs.=20 Political rhetoric is not going to change the math he said.=20 In the Legislature lawmakers are growing grumpier. Most were taken by=20 surprise Monday when blackouts were ordered across the state weeks before= =20 summer temperatures were expected to set in and strain the power system.=20 I'm more worried than ever said Assemblyman Bill Leonard R-San=20 Bernardino. A lot of the elements we thought we had a handle on in January= =20 are unraveling.=20 A deal the governor said had been worked out weeks ago between the state an= d=20 more than 600 small alternative energy suppliers collapsed last week.=20 The alternative generators have not been paid by the utilities for months= =20 and state leaders attempted to bargain down the price utilities pay those= =20 generators for power.=20 But administration officials complained privately that lawmakers instead=20 sweetened the pot for the suppliers to the point that the measure no longer= =20 helped solve the overall financial situation pushing the utilities toward= =20 bankruptcy. Under a proposal announced Tuesday by Davis the Legislature=20 would authorize the PUC to require the utilities to pay the alternative=20 suppliers at prices more closely resembling the original deal.=20 But the governor ran into immediate opposition as some suppliers said said= =20 he would not pay them enough to cover their fuel costs.=20 We would go from not being paid to losing money said Hal Dittmer of=20 Wellhead Electric a Sacramento-based supplier that has been shut down for= =20 more than a month. Almost everybody who burns natural gas is going to shut= =20 down. (Davis) got it wrong.=20 Democrats outside the Davis administration meanwhile are complaining abou= t=20 the amount of money the state Department of Water Resources is spending on= =20 expensive last-minute power purchases. Within a week $4.2 billion will ha= ve=20 been committed.=20 State Sen. Steve Peace D-El Cajon chairman of the joint Legislative Budge= t=20 Committee is warning the Davis administration that he will block additiona= l=20 funds for last-minute purchases of power until the PUC makes progress=20 recovering money that already has been spent. He intends to hold a hearing = on=20 the issue this morning.=20 On Wednesday state Controller Kathleen Connell told Davis she will refuse = to=20 make a routine budget transfer he had requested saying she is concerned th= at=20 there is no outside check and balance on the money the administration is= =20 spending to buy electricity on the spot market.=20 As the statewide elected official who pays the state's bills Connell said= =20 she has yet to receive information from the Department of Water Resources= =20 about how much it is spending.=20 We really need an accounting as to the total amount of liability they have= =20 accumulated she said. I understand they're in an emergency situation ...= =20 but it begins to imperil the state's ability to manage its cash flow.=20 Meanwhile a bill to provide $1 billion for conservation programs aimed at= =20 reducing power needs this summer also has languished for several weeks in= =20 the state Senate. While Davis has focused his attention elsewhere Republic= an=20 lawmakers have opposed the measure as too expensive. Democrats argue that= =20 each two-week delay prevents the state from saving as much energy as one=20 peaker plant will produce this summer. Peaker plants are designed to help= =20 meet the peaks of electricity demand.=20 I'm the eternal optimist but we have to keep working on all fronts said= =20 Sen. Byron Sher D-Palo Alto who hopes to take his energy conservation bil= l=20 up for a vote in the Senate again today. It's a formidable challenge.=20 Bee staff writer Dale Kasler contributed to this report.=20 --- Legislators learn some details of power contracts By John Hill Bee Capitol Bureau (Published March 22 2001)=20 The veil of secrecy surrounding the state's electricity contracts lifted=20 Wednesday -- a little.=20 Gov. Gray Davis gave state legislators a report laying out some of the=20 details of long-term contracts designed to help the state pull out of its= =20 energy crisis. But the report left legislators and others clamoring for mor= e.=20 The information raises more questions said Assemblyman George Runner=20 R-Lancaster. I liken it to watching a parade through a knothole in a fence= .=20 You get to look at one float but you're not sure about what's coming up an= d=20 what you've missed.=20 Davis had previously disclosed that the state had signed or was close to=20 signing 40 long-term contracts at an average price over 10 years of $69 pe= r=20 megawatt-hour.=20 The contracts are part of the state's strategy for trying to avoid a fiscal= =20 shellacking in the energy spot market while making sure there's enough=20 electricity to avoid more blackouts.=20 Davis also previously disclosed that the contracts were for an average of= =20 about 9000 megawatts a year and that the total cost exceeded $40 billion.= =20 But Davis has resisted telling more saying the state would jeopardize its= =20 ability to get the best prices if electricity generators knew what their=20 counterparts were getting.=20 On Wednesday the governor's office released a March 15 report from S. Davi= d=20 Freeman general manager of the Los Angeles Department of Water and Power = to=20 the state Department of Water Resources. The state agency has been given th= e=20 responsibility of making power purchases and Freeman was brought in to lea= d=20 the negotiations.=20 As of March 15 the state had signed 19 contracts with seven suppliers for= =20 periods ranging from 14 months to 20 years with many for three or five=20 years the report says. Some of the contracts are for electricity to meet t= he=20 state's everyday power demand while others are only for times of peak use= =20 such as hot summer days.=20 The state had agreements in principle for an additional 25 contracts.=20 Runner said he has been told that two of these contracts have since been=20 finalized.=20 The amount of power provided reaches a peak in 2004 of more than 10000=20 megawatts. As the long-term contracts start to expire around then the stat= e=20 is hoping that demand can be met with new contracts or spot purchases at=20 prices expected to be much cheaper.=20 The report says nine more long-term contracts were under discussion.=20 Some of the contracts are with power generators while others are with=20 marketers who may get the power from a number of sources.=20 In some cases the state may supply the natural gas used to generate the=20 electricity or power costs may be pegged to the going rate for the fuel.= =20 Some suppliers can cancel if the state fails to sell bonds by a certain dat= e=20 to cover power costs or fails to maintain an investment grade credit rating= .=20 Some depend on the construction of power plants but Freeman said they were= =20 firm commitments.=20 We were pretty careful not to put a hope and a dream in the portfolio he= =20 said.=20 More contracts will have to be signed to meet summer demand and these=20 agreements will probably be more expensive the report says.=20 One item not in Freeman's report was a secret deal to relieve several major= =20 generators from having to pay for polluting the air beyond allowable limits= .=20 The long-term power contracts include language that would have the state pa= y=20 the costs of pollution credits that allow power plants to exceed their=20 permitted levels of smog-forming pollutants the governor's office confirme= d=20 Wednesday. Spokesman Steve Maviglio said that several generators are being= =20 relieved from having to pay those costs.=20 V. John White a Sierra Club lobbyist close to the negotiations said Dyneg= y=20 Inc. which has power plants in El Segundo Encina and Long Beach is one o= f=20 them. Dynegy officials did not return calls to The Bee on Wednesday.=20 Freeman said that generators were demanding hefty premiums for having to de= al=20 with air quality regulators in the summer and he figured it would be cheape= r=20 just to pay for the pollution credits.=20 In other energy-related developments:=20 With more power plants back online grid operators dropped down to a Stage = 1=20 electricity alert. The state Independent System Operator was expecting=20 supplies to gradually increase over the next few days.=20 The state Public Utilities Commission issued a revised draft decision that= =20 would impose the prices outlined Tuesday by Davis for power produced by=20 alternative energy companies -- $79 a megawatt-hour for five-year contracts= =20 or $69 a megawatt-hour for 10 years. The proposal is scheduled for a PUC vo= te=20 March 27.=20 A federal judge ruled that one of the nation's major electricity generators= =20 must continue supplying California with emergency power.=20 In imposing an injunction on Reliant Energy Services Inc. U.S. District=20 Judge Frank C. Damrell Jr. noted the rolling blackouts (that have) darkene= d=20 the California landscape and said the loss of Reliant's production poses = an=20 imminent threat.=20 Bee staff writers Carrie Peyton Chris Bowman and Denny Walsh contributed t= o=20 this report.=20 --- Federal judge orders major power wholesaler to sell to California=20 By Don Thompson ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) A federal judge issued a preliminary injunction Wednesday= =20 ordering a major electricity wholesaler to continue selling to California= =20 despite its fear that it will not get paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant Energy Services stopped selling power to the=20 Independent System Operator which oversees the state's power grid. The ISO= =20 buys last-minute power on behalf of utilities to fill gaps in supply to try= =20 to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The state has been spending about $50 million a day on power for Pacific Ga= s=20 and Electric Co. and Southern California Edison both denied credit by=20 suppliers after amassing billions of dollars in debts.=20 Controller: State's power spending imperils its financial health=20 Governor says utilities must pay in advance for some power=20 ?=20 The judge said he had no authority to force the DWR to pay for that power.= =20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 Damrell denied the ISO's request for preliminary injunctions against three= =20 other wholesalers Dynegy AES and Williams who agreed to continue selling= =20 to the ISO pending the FERC ruling.=20 The ISO went to court in February after a federal emergency order requiring= =20 the power sales expired. The judge then issued a temporary restraining orde= r=20 requiring the sales but dropped it after the suppliers agreed to continue= =20 sales to California pending his Wednesday ruling.=20 The ISO said it would lose about 3600 megawatts if the suppliers pulled ou= t=20 enough power for about 2.7 million households. One megawatt is enough for= =20 roughly 750 homes.=20 Grid officials said Reliant's share alone is about 3000 megawatts. Reliant= =20 said the amount at issue actually is less than a fourth of that because mo= st=20 of the power is committed under long-term contracts.=20 Reliant which provides about 9 percent of the state's power worries it=20 won't get paid due to the financial troubles of PG&E and Edison.=20 PG&E and Edison say that together they have lost about $13 billion since Ju= ne=20 due to soaring wholesale electricity costs that California's 1996=20 deregulation law bars them from passing onto customers.=20 At the same time the state has faced a tight electricity supply due in pa= rt=20 to California power plant shutdowns for maintenance and to a tight=20 hydroelectric supply in the Pacific Northwest.=20 Managers of the state power grid imposed rolling blackouts across the state= =20 Monday and Tuesday as supply fell short of demand. Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts.=20 State Controller Kathleen Connell said Wednesday that the energy crunch als= o=20 imperils California's financial health.=20 Connell said the state's power-buying on behalf of Edison and PG&E is is=20 gutting its budget surplus. Since the state started making emergency power= =20 buys in January the surplus has fallen from $8.5 billion to about $3.2=20 billion she said.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is refusing a request by Davis and the Legislature to transfer $5.6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its=20 power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= =20 The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 --- Controller: State's power spending imperils its financial health=20 By Don Thompson ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) California's power-buying on behalf of two strapped utiliti= es is=20 gutting its budget surplus and putting the state at financial risk the sta= te=20 controller said Wednesday.=20 The surplus dropped from $8.5 billion in January when the state began buyi= ng=20 electricity for Pacific Gas and Electric Co. and Southern California Edison= =20 to $3.2 billion now Kathleen Connell estimates.=20 Connell ordered an audit of the state's power-buying saying Gov. Gray Davi= s=20 is withholding key financial information from her office and the Legislatur= e.=20 Wednesday marked the first time in three days the state avoided rolling=20 blackouts. Power grid officials credited cooling temperatures and the=20 completion of repairs at several power plants.=20 Connell said the energy crunch now imperils the state's budget as well as i= ts=20 electric grid.=20 California has been spending about $45 million a day =01) $4.2 billion so f= ar =01)=20 to buy power for Edison and PG&E both denied credit by electricity=20 wholesalers.=20 The two utilities California's largest say they are nearly $14 billion in= =20 debt due to soaring wholesale power costs the state's deregulation law bloc= ks=20 them from recovering from customers.=20 Meanwhile the state has faced high natural gas costs and a tight power=20 supply driven in part by power plant repairs in California and scarce=20 hydroelectric power in the Pacific Northwest.=20 Standard & Poor's has put the state on a credit watch due to its power=20 purchases and chastised Davis the Legislature and state regulators for not= =20 taking more aggressive steps to assure the utilities can pay their bills.= =20 On Wednesday Connell said she is refusing a request by Davis and the=20 Legislature to transfer $5.6 billion into a rainy day fund she said was s= et=20 up to impress Wall Street as the state prepares to issue $10 billion in=20 revenue bonds to cover its power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Connell said the scope of the proposed transfer is unprecedented and amount= s=20 to a shell game that disguises the power purchases' impact on the state= =20 budget.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= =20 The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details. He said his= =20 plan may involve giving the utilities low-interest loans with their=20 transmission lines held as collateral.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 --- Governor says utilities must pay in advance for some power=20 By Jennifer Coleman ASSOCIATED PRESS=20 March 21 2001=20 SACRAMENTO =01) The state's two largest utilities will be ordered to pay=20 environmentally friendly power generators in advance a move Gov. Gray Davi= s=20 hopes will bring a quick end to the power blackouts that darkened Californi= a=20 this week.=20 The statewide blackouts that stretched from San Diego to Oregon on Monday a= nd=20 Tuesday were caused in part by the failure of Southern California Edison an= d=20 Pacific Gas and Electric Co. to pay millions of dollars they owe qualifyin= g=20 facilities or QFs Davis said.=20 Such suppliers use cogeneration =01) steam from manufacturing plus natural = gas =01)=20 or solar wind and other renewable energy to generate electricity. This wee= k=20 California lost about half the power those generators normally provide.=20 Controller: State's power spending imperils its financial health=20 ?=20 Several of them said they hadn't been paid by Edison and PG&E in weeks and= =20 can't afford to keep operating their plants.=20 Davis accused the utilities of taking in money from customers while failing= =20 to pay the QFs. The state has been spending about $45 million a day since= =20 January to buy power for customers of Edison and PG&E which are so=20 credit-poor that suppliers refuse to sell to them.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators the governor said at a Capitol news conference Tuesday= =20 evening. They've acted irresponsibly and immorally and it has to stop.=20 PG&E called the governor's statements inappropriate and unjustified addi= ng=20 that it was negotiating a payment plan with the QFs. Edison said it is inte= nt=20 on paying creditors and working with the California Public Utilities=20 Commission to pay QFs for future power sales.=20 Controller Kathleen Connell warned Wednesday that the state's $2=20 billion-a-month power purchases are jeopardizing California's budget.=20 The state's budget surplus dropped from $8.5 billion in January when the= =20 power purchases began to $3.2 billion now Connell estimates. She blamed= =20 Davis for withholding key financial information and ordered an audit of th= e=20 state's power spending starting next week.=20 She blocked a request by the Legislature and Davis administration to transf= er=20 $5.6 billion from the state's general fund into a special rainy day fund= =20 saying that would have left the general fund $2.4 billion in debt.=20 The Legislative Analyst's Office said such transfers are routine Connell= =20 agreed but said the size of the transfer is unprecedented.=20 We started this year with a generous budget surplus Connell said. The= =20 energy crisis has taken much of that away and this transfer on top of the= =20 electricity purchases would put the fund at risk.=20 Meanwhile keepers of the state's power grid were optimistic California wou= ld=20 get through Wednesday without another day of rolling blackouts. Two plants= =20 down for repairs returned to service.=20 Several power plants that were taken down for repairs are also expected com= e=20 online by the end of the week reducing the likelihood of blackouts said J= im=20 Detmers ISO vice president.=20 Power may flow to homes and businesses but it could soon cost consumers=20 more said Assemblyman Fred Keeley one of the Legislature's leaders on=20 energy issues.=20 I think it's intellectually appropriate and honest to tell people as soon = as=20 it's apparent that a rate increase is warranted the Boulder Creek Democra= t=20 said Tuesday indicating that time had come.=20 He estimated that the state Public Utilities Commission may soon have to=20 raise rates by about 15 percent to cover the state's costs and its utilitie= s'=20 bills.=20 My sense is that people will appreciate having some certainty and being ab= le=20 to plan for it he said. They don't have to like it but I think they'll= =20 appreciate it.=20 Davis said he is confident the utilities and the state can pay their bills= =20 without further rate increases for Edison and PG&E customers.=20 In the meantime the Independent System Operator keeper of the grid is=20 counting on continued conservation by residents and businesses to avoid mor= e=20 blackouts. Conservation accounted for about 300 megawatts in savings during= =20 Tuesday's peak usage enough to power 300000 homes.=20 Roughly a half-million homes and businesses were affected by Tuesday's=20 blackouts which snarled traffic and plunged schools and businesses into=20 darkness across the state.=20 The outages began at 9:30 a.m. and continued in 90-minute waves until about= 2=20 p.m. when the ISO lifted its blackout order. They were blamed for at least= =20 one serious traffic accident.=20 Two cars collided at an intersection in the Los Angeles suburb of South El= =20 Monte where the traffic lights were out. Two people were seriously hurt sa= id=20 California Highway Patrol Officer Nick Vite.=20 In San Francisco's Chinatown souvenir shops normally bustling with visitor= s=20 were forced to shut down. Nearby irritated customers waited for a bank to= =20 reopen.=20 The blackouts like Monday's were caused by a combination of problems=20 including unseasonably warm weather reduced electricity imports from the= =20 Pacific Northwest and numerous power plants being shut down for repairs.=20 Adding to those troubles the state lost about 3100 megawatts from the QF= =20 plants.=20 Senate Energy Committee Chairwoman Debra Bowen D-Marina del Rey estimated= =20 Tuesday that Edison has amassed more than $1 billion and PG&E more than $2= =20 billion that they have not paid to generators.=20 Davis said the PUC planned to issue an order next week directing the=20 utilities to pre-pay their future QF bills.=20 PG&E said its prepayments hinge on an upcoming PUC decision on whether the= =20 utility's rates are sufficient to pay its bills and cover the state's power= =20 purchases on its behalf which amount to $4.2 billion since early January.= =20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices which the state's 1996 deregulation= =20 law prevents them from passing on to ratepayers.=20 --- Energy Overcharge of $5.5 Billion Is Alleged=20 Power: Money should be refunded to taxpayers and utilities the state grid= =20 operator says citing evidence of market manipulation. Suppliers deny the= =20 accusation.=20 By TIM REITERMAN and NANCY RIVERA BROOKS Times Staff Writers=20 ?????Wholesale electricity suppliers overcharged California by about $5.5= =20 billion between May and last month and that money should be refunded to th= e=20 state's taxpayers and financially strapped utilities the state power grid= =20 operator said Wednesday. ?????Generators engaged in market manipulation and consistent patterns of= =20 bidding far above costs in the deregulated energy market the California=20 Independent System Operator found in a study of pricing data. The findings= =20 support the widespread belief that these suppliers reaped massive additiona= l=20 revenue by manipulating the market. ?????Spokesmen for the companies denied the accusation. ?????The study prepared for a filing with federal regulators today is=20 central to Cal-ISO's efforts to seek reimbursement for what it considers=20 excessive charges by electricity suppliers during the state's energy crisis= . ?????This might be the first time we told them the total impact and=20 magnitude [of the overcharging] said Anjali Sheffrin Cal-ISO's director = of=20 market analysis. We think the entire amount deserves consideration for=20 refunds. ?????Using confidential bidding data on tens of thousands of electricity=20 sales Cal-ISO found that five companies that together supply about 30% of= =20 the power delivered to customers of the state's investor-owned utilities=20 engaged in two types of behavior that tended to push up prices: ?????* They effectively withheld supplies by bidding at excessive prices= =20 even though they could have made some money selling more electricity. ?????* Less frequently they had power generation available but did not bid= =20 at all. ?????The study concluded that energy suppliers commonly offered their=20 electricity at twice their cost. For example Sheffrin said the average=20 markup in August was 100% during peak hours. ?????A spokeswoman at the Federal Energy Regulatory Commission which=20 oversees wholesale electricity pricing across the country declined to=20 comment Wednesday saying This is part of an ongoing proceeding. ?????FERC member William L. Massey who has considered previous commission= =20 actions on refunds to be inadequate said it would be improper for him to= =20 comment on a report that has not yet been filed. But when told of the=20 $5.5-billion total Massey said: That doesn't shock me in any way. ?????Prices over the past 10 months in California have greatly exceeded th= e=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said. ?????Cal-ISO which oversees grid operations and an emergency energy market= =20 previously detailed $550 million in alleged overcharges for December and=20 January and asked FERC for refunds. But the commission has proposed refunds= =20 of only a tiny fraction of that amount. ?????The study covered five major in-state power suppliers--Reliant Energy= =20 Dynegy Williams/AES Duke Energy and Mirant formerly Southern Energy--plu= s=20 16 power importers all of which deliver power to customers of Pacific Gas = &=20 Electric Co. Southern California Edison and San Diego Gas & Electric Co. ?????All [21] overcharged but some excessively and some by moderate=20 amounts Sheffrin said. ?????Cal-ISO's public filing will quantify the alleged overcharging by each= =20 company but the companies will be identified only by a number. The code wi= ll=20 be provided to FERC Sheffrin said and Cal-ISO lawyers will determine how= =20 much information about the companies will be made public. ?????State U.S. Investigations ?????California electricity markets and the companies that buy and sell pow= er=20 in the state have been the subject of several investigations by state and= =20 federal authorities since wholesale electricity prices first skyrocketed in= =20 May. ?????Electricity suppliers have repeatedly denied manipulating the Californ= ia=20 market in any way whether through above-cost bidding in spot markets or=20 through physical withholding of electricity to drive up prices. ?????Reliant Energy is cooperating with FERC's requests for more data and i= s=20 confident the commission will conclude that prices charged by Reliant were= =20 justified said Joe Bob Perkins president of the Houston-based company. ?????Perkins also bitterly disputed charges that Reliant has shut down unit= s=20 so that it can earn bigger profits on the power sold by the remaining plant= s.=20 These charges have been leveled against all of the power-plant owners in th= e=20 state. ?????Reliant Vice President John Stout said Cal-ISO's calculations typicall= y=20 don't include such fixed costs as salaries taxes and the interest on bonds= =20 they sold to finance their power plants which they acquired under terms of= =20 the state's landmark 1996 deregulation law. ?????In addition he said many high-priced power days have resulted from= =20 buyers bidding against each other for scarce supplies rather than sellers= =20 charging excessive amounts--like a house price being driven far above the= =20 listing price in a hot real estate market. ?????Williams Energy Services a trading company that markets most of the= =20 power produced by plants owned by AES also says it will be exonerated by= =20 FERC once the commission examines documentation being submitted said Paula= =20 Hill-Collins spokeswoman for the Tulsa Okla. company. ?????FERC has the obligation to investigate when these accusations are=20 made Hill-Collins said. This is just a process of justification not=20 necessarily proof of guilt. ?????Williams/AES was recently ordered by FERC to prove that it did not tak= e=20 generating units out of service last year to drive up electricity prices o= r=20 refund $10.8 million to California utilities. ?????During the period studied suppliers sold electricity in the Californi= a=20 Power Exchange to Southern California Edison PG&E and San Diego Gas &=20 Electric Co. and in a backup market for last-minute electricity operated by= =20 Cal-ISO. But sky-high prices plunged Edison and PG&E deeply into debt and= =20 most suppliers stopped selling to them in January forcing the state=20 Department of Water Resources to step in as the primary electricity buyer f= or=20 the three big utilities' 27 million customers. ?????The Cal-ISO study first summarized at an energy conference last week = at=20 UC Berkeley but not otherwise publicized concluded that the companies=20 exercised so-called market power to pump up electricity prices. ?????Severin Borenstein director of the Energy Institute at Berkeley said= =20 Cal-ISO's study is consistent with his research examining pricing practices= =20 in 2000. ?????We found several billion dollars . . . in departures from competitive= =20 pricing he said. When the market was tight this summer they were able t= o=20 push up prices and they did. ?????The early warning signs of electricity price spikes the study found= =20 appeared in May after two years of relatively stable prices of $30 to $40 p= er=20 megawatt-hour under deregulation. Prices went up during the summer dipped = in=20 September and October with lower demand then took off in November and=20 December as weather turned cold and the price of natural gas which is used= =20 to generate much of the state's electricity reached record levels. ?????There were plant outages and demand and supply became close Sheffr= in=20 said. Whatever price they bid had to be taken and market power asserted= =20 itself. ?????Cal-ISO found that $3 billion of the alleged overcharges occurred=20 between May and November. ?????On Friday federal regulators ordered six wholesale power suppliers to= =20 refund $55 million to California if they cannot justify prices charged in= =20 February. The refund was limited to power sold that month in excess of $430= =20 per megawatt-hour during Stage 3 power alerts when supplies are so tight= =20 that rolling blackouts are threatened. (One megawatt-hour is enough=20 electricity to supply 750 typical homes for an hour.) ?????The previous week FERC ordered 13 suppliers to justify or refund $69= =20 million for power sold in January at prices above $273 per megawatt-hour. ?????Massey opposed the potential refunds as too low because they were=20 limited to hours in which a Stage 3 power emergency was in place and becaus= e=20 the benchmark price set for each month was too high--combining to exempt mo= re=20 than 70000 transactions from scrutiny. ?????We're still looking for our lost wallet under the lamppost which is= =20 Stage 3 alerts said Massey one of three commissioners on the five-member= =20 board (two seats are vacant). ?????Generators have been given the free and clear he said. ?????These tinkling little refunds they have come out with recently are=20 almost a joke said Cal-ISO board member Mike Florio senior attorney at t= he=20 Utility Reform Network. ?????Resisting Price Caps ?????Cal-ISO contends that the last 10 months have proved that generators c= an=20 no longer be allowed to receive electricity prices that are dictated by wha= t=20 the market will bear. ?????FERC granted market-based rate authority on each of these suppliers'= =20 own showing that they could not manipulate prices yet their actions have= =20 shown the contrary Sheffrin said. We feel FERC needs to look at the=20 premise of allowing these generators to continue selling at market-based=20 rates. ?????The commission is responsible for ensuring just and reasonable=20 electricity rates. Although it has called California's power market=20 dysfunctional and vulnerable to manipulation the agency has resisted setti= ng=20 firm price caps sought by California's congressional delegation. ?????Chairman Curt L. Hebert Jr. strongly opposes caps while Massey wants = to=20 use caps across the West as a temporary timeout. ?????Energy Secretary Spencer Abraham in a New York news conference=20 Wednesday reiterated his opposition to electricity price caps as a way to= =20 cope with California's energy crisis. ?????If we put price caps in place there will be more blackouts and=20 they'll be worse Abraham said. ?????Cal-ISO is filing its market study as part of its comments on FERC sta= ff=20 recommendations on ways to thwart market manipulation. FERC's proposal=20 includes strict coordination of power plant outages by Cal-ISO with reporti= ng=20 of suspicious closures to FERC and generator-by-generator bid caps tied to= =20 costs. ---=20 ?????Reiterman reported from San Francisco Rivera Brooks from Los Angeles.= =20 Times staff writer Thomas S. Mulligan in New York contributed to this story= . --- --- Power Strain Eases but Concerns Mount=20 Energy: Officials say summer prices will be high and a state report shows= =20 that contracts with generators are far short of goals.=20 By DAN MORAIN and JENIFER WARREN Times Staff Writers=20 ?????SACRAMENTO--California's fragile electricity system stabilized=20 Wednesday but a Davis administration report suggested troubles ahead becau= se=20 the state could be forced to buy most of its power for the coming summer on= =20 the costly and volatile spot market. ?????After two days of statewide blackouts power plants that had been shut= =20 down were cranked up. Unseasonable heat tapered off. The operators of the= =20 statewide power grid relaxed their state of emergency. ?????But plenty of ominous signs remained. Many small producers remained sh= ut=20 down skeptical about Gov. Gray Davis' plan for utilities to pay them. ?????State Controller Kathleen Connell issued a sharp warning about the hig= h=20 cost of the state's foray into the power business and announced that she wi= ll=20 block an administration request that she transfer $5.6 billion into an=20 account that could be tapped to pay for state purchases of electricity. ?????And a report from the administration summarizing contracts between Dav= is=20 and independent power generators showed that the state has signed contracts= =20 for only 2247 megawatts of electricity significantly less than the 6000 = to=20 7000 megawatts previously claimed. ?????While there are agreements in principle for the full amount the repor= t=20 notes that generators can back out of the contracts for a variety of reason= s=20 including the state's failure to sell bonds to finance power purchased by= =20 July 1. The Legislature has approved plans to sell $10 billion in bonds bu= t=20 none have yet been issued. ?????We are exposed enormously this summer Senate Energy Committee=20 chairwoman Debra Bowen (D-Marina del Rey) said after looking at the report.= =20 We owe the people the truth about how difficult this summer is going to be= .=20 We don't have a power fairy. ?????Perhaps most significant the report suggests that the contracts fall= =20 significantly short of Davis' stated goal of buying no more than 5% of the= =20 state's summer needs on the spot electricity market where prices can be ma= ny=20 times those of long-term contracts. ?????After reading the report Frank Wolak a Stanford University economist= =20 who studies the California electricity market said the numbers suggested= =20 that the state's long-term contracts will cover less than half of what the= =20 state will need this summer. ?????We're definitely short this summer next summer and the summer of=20 2003 he said. ?????California was forced to start buying electricity in December--at a co= st=20 of $50 million a day--because producers refused to sell to Southern=20 California Edison and Pacific Gas & Electric. The two utilities amassed=20 billions of dollars in debt when prices for wholesale power soared on the= =20 spot market. ?????Vikram Budhraja a consultant retained by Davis to negotiate deals wit= h=20 generators said the report represents a work in progress. He said the=20 state may yet sign new contracts. ?????However Wolak said the contract figures confirm what he and others ha= ve=20 been dreading: that summer is going to be rife with rolling blackouts unles= s=20 serious steps to cut demand are taken immediately. ?????Wolak and other experts say large industrial customers must be switche= d=20 to real-time meters and pricing to persuade them to use the bulk of their= =20 energy at times of low demand. ?????The head of the Energy Foundation a San Francisco-based nonprofit tha= t=20 promotes sustainable sources of power made the same proposal to Davis on= =20 Wednesday. ?????The government need not ask customers to swelter in the dark this=20 summer foundation President Hal Harvey argued in a letter. ?????He also proposed a crash campaign to boost sales of efficient applianc= es=20 and lightbulbs. He said the state needs to take over the utilities' contrac= ts=20 with alternative energy providers to ensure they stay in business and sign= =20 new contracts for 1500 megawatts of new wind power--the cheapest fastest= =20 and cleanest source of new supply. ?????Davis had proposed a formula Tuesday to force private utilities to pay= =20 the alternative producers some of which have not been paid since November.= =20 But some of them warned Wednesday that Davis' plan offers them little=20 incentive to turn on their generators. ?????Alternative energy producers supply more than a quarter of the=20 electricity consumed in California. ?????Many producers generate electricity from wind sun and geothermal=20 sources. But most of them generate power using natural gas--and the cost of= =20 natural gas has been soaring. Several natural gas users said Davis' plan= =20 which caps rates won't cover their fuel costs. ?????Davis assumes that the price of natural gas will fall. But small=20 generators say they don't have sufficient purchasing power or sophisticatio= n=20 to gamble on future prices. ?????The Public Utilities Commission is expected to approve Davis' proposal= =20 next week. It offers producers two choices: 7.9 cents a kilowatt-hour if th= ey=20 agree to supply power for five years or 6.9 cents a kilowatt-hour over 10= =20 years. ?????The price of natural gas is higher than that said Marty Quinn=20 executive vice president and chief operating officer of Ridgewood Power LLC= =20 which owns three natural gas-fired co-generation plants. If we operate=20 we'll lose money. ?????Ridgewood is not operating having been cut off by gas suppliers. The= =20 company sued PG&E last month seeking overdue payments and release from its= =20 contracts with the utility. ?????A hearing is scheduled in El Centro today in another lawsuit filed by = a=20 small energy producer an Imperial Valley geothermal producer that sued=20 Edison for refusing to let it break its contract and sell on the open marke= t.=20 CalEnergy says Edison owes it about $140 million for energy sold since=20 November. ?????A company spokesman Jay Lawrence said CalEnergy was going ahead with= =20 its suit despite Davis' proposal. We've had promises before he said. ?????In other developments: ?????* A federal judge in Sacramento on Wednesday ordered Reliant Energy of= =20 Houston a major producer to continue selling power to California during= =20 emergencies despite the company's argument that it may not be fully=20 reimbursed. The order will remain in effect for 60 days or until the U.S.= =20 Federal Energy Regulatory Commission decides a related case. ?????* Connell said the state budget surplus has shrunk to $3.2 billion=20 because the state has spent roughly $2.8 billion on electricity. She=20 criticized the administration for withholding basic information about state= =20 finances and said she will begin an audit on Monday of the Department of= =20 Water Resources which is responsible for purchasing power. ?????Davis' aides said Connell took her action because the Democratic=20 governor endorsed one of Connell's foes this week in the race for Los Angel= es=20 mayor former Assembly Speaker Antonio Villaraigosa. A Connell aide scoffed= =20 at the notion. ?????* Sen. Dianne Feinstein (D-Calif.) said she never has had a response= =20 from President Bush after writing him last month for an appointment to=20 discuss the California energy crisis. ?????In a wide-ranging lunch talk with reporters in Washington she deplore= d=20 the fact that huge huge profits are being made in the California crisis= =20 and said an appropriate federal role would be to guarantee a reliable=20 source of power until the state can get nine new generators online. ---=20 ?????Times staff writers Mitchell Landsberg in Los Angeles and Robert L.=20 Jackson in Washington contributed to this report. --- --- ------------------------ --- --- ------------------------ Net Complex A Dilemma For San Jose=20 SERVER FARM: Plant would tax grid=20 David Lazarus Chronicle Staff Writer Thursday March 22 2001=20 2001 San Francisco Chronicle=20 URL:=20 /22/M N236772.DTL=20 San Jose while trying to block construction of a new power plant is set t= o=20 approve a vast computer complex that could overwhelm California's already= =20 strained power grid.=20 City officials gave preliminary approval last week to what would be the=20 world's largest server farm. The sprawling facility to handle Internet=20 traffic would drain about 150 megawatts of power from the state electricity= =20 grid.=20 If granted final authorization on April 3 the $1.2 billion project would a= dd=20 the equivalent of about 150000 homes to California's power system which w= as=20 hit this week by rolling blackouts as demand for juice outstripped availabl= e=20 supply.=20 The server-farm issue highlights a vexing dilemma for the state.=20 On the one hand Gov. Gray Davis is calling for widespread conservation to= =20 help California overcome its current troubles. On the other no one wants t= o=20 curtail growth of the high-tech industry which is an engine for economic= =20 vitality.=20 San Jose will make a lot of money from this project said Craig Breon=20 executive director of the Santa Clara Valley Audubon Society. But to not= =20 help the state out of its energy situation there's a fair amount of=20 hypocrisy going on.=20 The server farm would be owned by U.S. DataPort a San Jose data-management= =20 firm. As planned it would occupy 10 buildings on more than 170 acres in th= e=20 city's Alviso area.=20 Total projected energy use would be 180 megawatts. About 30 megawatts would= =20 be generated by a small on-site facility and the rest would have to be=20 provided by Pacific Gas and Electric Co.=20 We're confident that the DataPort project will be approved because it's ve= ry=20 important to San Jose and to the local economy said San Jose Mayor Ron=20 Gonzales.=20 But PG&E already is saying that its power cupboard is bare. The utility do= es=20 not have sufficient existing electric infrastructure to meet U.S. DataPort= 's=20 needs it said in a recent letter to San Jose officials.=20 John Mogannam U.S. DataPort's senior vice president of operations counter= ed=20 that it could take as long as five years for the server farm to grow big=20 enough to require the full 150 megawatts from the state grid.=20 Hopefully by then the whole energy crisis will pass by and we won't have= a=20 problem he said.=20 Mogannam stressed the positive aspects of the project such as its ability = to=20 handle about 15 percent of global Internet traffic the 700 jobs it would= =20 create and the $70 million over 10 years it would generate for San Jose in= =20 property and utility taxes.=20 That's why the city likes it he said.=20 Indeed San Jose officials are so enamored with such developments that they= =20 have all but turned a deaf ear to warnings that the server farm will=20 exacerbate California's already dire power shortage.=20 Andrew Crabtree the city's senior planner said the planning commission ha= d=20 barely touched the question of energy supply when it approved the server fa= rm=20 last week.=20 It wasn't incumbent on the commission to solve the state's energy-supply= =20 problems he said.=20 Rather San Jose city planners focused on the environmental ramifications o= f=20 the proposed facility including air pollution from diesel generators and t= he=20 impact on nearby wildlife.=20 How it would affect dozens of burrowing owls in the area was a key topic of= =20 discussion.=20 We all recognized that there's a power shortage Crabtree said. But we= =20 couldn't do anything about that with this project.=20 Except to make things tougher of course.=20 Server farms run 24 hours a day seven days a week. They are an aspect of t= he=20 high-tech boom that was never foreseen by energy experts and which are now= a=20 major contributor to California's surging electricity demand.=20 A server farm essentially is a large building filled with computers. Each= =20 computer handles the Web site or Internet traffic for hundreds of corporate= =20 clients that do not have the technical resources to look after such things= =20 in- house.=20 Most server farms consume between 10 and 60 megawatts of power. At 180=20 megawatts the U.S. DataPort facility is billed as the most extensive data= =20 center on the planet.=20 There won't be another this size anywhere in the world said Mogannam th= e=20 company's senior vice president. This will be the biggest.=20 With such a vast scale however comes additional concerns. For example al= l=20 that hardware will generate huge amounts of heat requiring powerful air=20 conditioners running around the clock to keep things cool.=20 Patrick Dorinson a spokesman for the Independent System Operator which=20 oversees California's electricity network said server farms had a big=20 impact on the state's tight energy supply.=20 We have an economy that's increasingly based on delivery of information = he=20 observed. We certainly need to make sure we're building adequate generatio= n=20 and transmission to get it there.=20 As it stands no major power plants have been built in California for the= =20 past 12 years while dozens of server farms have sprung up throughout the= =20 state.=20 The Yankee Group a Boston consulting firm estimates that the amount of=20 space taken up by server farms nationwide rose to 9 million square feet fro= m=20 1999 to 2000.=20 By 2003 it expects that figure to increase to 25 million square feet or= =20 enough room for more than a hundred 10-story office buildings.=20 San Francisco may be the exception. Supervisor Sophie Maxwell proposed=20 interim zoning controls last week that would require server farms to receiv= e=20 special permission from City Hall to operate.=20 San Jose for its part has no such reservations. It does however draw th= e=20 line at big fat power plants in the backyard of the city's leading corpora= te=20 citizen.=20 Gonzales is spearheading opposition to a proposed 600-megawatt generating= =20 facility in Coyote Valley because of its proximity to a residential area at= =20 the site of a planned Cisco Systems office complex.=20 There's plenty of opportunities to generate power in the city he said.= =20 This project is just in the wrong site.=20 The matter is now in the hands of the California Energy Commission which i= s=20 expected to issue a ruling by May.=20 Cisco critics say twisted the mayor's arm to fight the plant because it d= id=20 not want a generating facility in its neighborhood. The area will be home t= o=20 thousands of well-heeled tech workers.=20 It's politics said Breon at the Audubon Society. City officials are=20 making political decisions rather than good planning decisions.=20 Ted Smith executive director of the Silicon Valley Toxics Coalition a=20 grassroots organization is calling for a moratorium on construction of all= =20 new server farms in the South Bay until sufficient power can be found to ke= ep=20 them running.=20 Until they figure out how to build these things without draining the=20 electricity grid even dryer it is they shouldn't build them he said.=20 The Internet industry is creating unintended consequences that will really= =20 screw up our future Smith added. They are so busy focusing on next=20 quarter's profits that they don't stop and think about the consequences. .= =20 .=20 SOME FAST FACTS ABOUT 'SERVER FARMS' .=20 -- What are they? Server farms are facilities dedicated exclusively to=20 housing powerful computers for Internet use.=20 -- Who uses them? Companies and individuals pay server farms to maintain=20 their Web sites handle Net traffic and store vast amounts of data --=20 functions that otherwise would require extensive hardware and technical=20 support.=20 -- Why do they use them? As Internet use explodes server farms play an=20 increasingly vital role in managing data and keeping information moving.=20 -- What's the problem? Server farms drain considerable amounts of electrici= ty=20 to keep running.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- Contracts Won't Meet Summer Demands=20 DETAILS: 2004 before full impact felt=20 Lynda Gledhill Chronicle Sacramento Bureau Thursday March 22 2001=20 2001 San Francisco Chronicle=20 URL:=20 /22/M N230640.DTL=20 Sacramento -- Long-term power contracts negotiated by the state won't cover= =20 California's entire demand for electricity until 2004 according to newly= =20 released details about the agreements.=20 The information suggests that California might have to scrounge for=20 electricity on the high-priced spot market for a couple more years even as = it=20 continues to push conservation efforts and construction of more generating= =20 plants.=20 Details of the agreements released by Gov. Gray Davis' administration show= =20 that the contracts will provide for just over a third of the state's demand= =20 for power this year. Energy secured by the contracts will grow to meet the= =20 expected demand in three years.=20 Short-term purchases of power have at least temporarily depleted the state'= s=20 budget surplus and have raised the possibility of sharp rate increases=20 sometime in the future for electricity customers.=20 Davis administration officials are banking on the hope that conservation=20 efforts and increased generating capacity will cover the shortfall along wi= th=20 purchases of electricity on the spot market.=20 We're facing an extreme challenge still this summer said Severin=20 Borenstein head of the University of California at Berkeley Energy=20 Institute. Signing contracts doesn't create more electricity.=20 The information released did not include the names of companies that the=20 state has signed contracts with or the purchase prices.=20 The sketchy details did not satisfy frustrated lawmakers who said many=20 questions remain especially how much the state will end up paying under th= e=20 terms of the contracts.=20 The fundamental question is how much is it costing the state of California= =20 to keep the lights on said Assemblyman Tony Strickland R-Thousand Oaks.= =20 What we really need is total disclosure.=20 The state started buying power in January after generators began refusing = to=20 provide electricity to the state's investor-owned utilities. Pacific Gas an= d=20 Electric Co. and Southern California Edison say they have more than $13=20 billion in past debt.=20 The state has been spending $49 million a day on power purchases since Jan.= =20 17 according to documents obtained by The Chronicle last week.=20 Those documents said the average price of the contracts across 10 years is= =20 $69 per megawatt hour including summer peak. The five-year average price i= s=20 $79 per megawatt hour.=20 According to one chart provided by the governor's office yesterday the=20 long-term contracts will fall about 35 million megawatt hours short in 2002= .=20 Based on the average price per megawatt hour the state has been paying sinc= e=20 January that could end up costing between $6.6 billion and $13 billion.=20 The law creating the state purchasing authority allowed purchases up to $10= =20 billion and extends until 2003.=20 The governor's office said 21 contracts have been signed and another 23=20 agreements that have been reached but not yet signed.=20 Several generators have said that they will not sign contracts with the sta= te=20 until the back debt by the utilities has been taken care of.=20 We have some real potential problems said Senate President Pro Tem John= =20 Burton D-San Francisco.=20 Strickland and several media outlets including The Chronicle have filed= =20 public information requests to get more information about the prices of the= =20 contracts from the administration.=20 Releasing the information would jeopardize the negotiations for future=20 contracts said Steve Maviglio Davis' spokesman.=20 Lawmakers also frustrated by the lack of information given out by the Davi= s=20 administration were not given notice that the information was coming and= =20 many said it was lost in their mail pile.=20 The cover letter was on Los Angeles Department of Water and Power letterhea= d=20 not that of the administration. The letter was written by S. David Freeman= =20 head of the Los Angeles system who was on leave for the month of February t= o=20 help the state negotiate the contracts.=20 Assemblyman George Runner R-Lancaster said the ambiguity of the=20 information raises more questions than it answers.=20 It's like watching a parade through a peephole he said. He's showing us= =20 another float but I don't know what the parade looks like.=20 Blaming the state's purchases of electricity Controller Kathleen Connell= =20 said yesterday that the state's cash on hand had fallen from $8.5 billion i= n=20 January to $3.2 billion. Connell ordered an audit of the state's power=20 buying.=20 Connell said she would block a transfer sought by the Davis administration = of=20 $5.6 billion from the general fund to the state's emergency reserve account= =20 claiming it would lead to a ''serious cash flow crisis.=20 The transfer however is not related to the energy crisis. The sum=20 represents a routine rollover of unspent money from the previous fiscal yea= r.=20 State law requires that money to be sent to a special reserve account for= =20 emergencies.=20 Davis officials acknowledged that $3.7 billion in energy purchases have had= =20 an impact on state coffers but they say the state will be repaid once bond= s=20 are issued in the coming weeks. They also said the state typically has its= =20 lowest cash reserves at this time of year. That changes in mid-April when a= =20 flood of income tax revenue pours in.=20 The transfer has nothing to do with energy purchases said Sandy Harrison= =20 a spokesman for the Department of Finance.=20 It's not helpful to ratepayers taxpayers and people who want their lights= =20 to stay on to have the issue muddied with this sort of inaccurate innuendo= =20 Harrison said.=20 In other developments yesterday:=20 -- After two days of statewide rolling blackouts power grid managers avoid= ed=20 outages. Demand was lower because of cooler temperatures around the state a= nd=20 supply increased as several power plants completed repairs.=20 -- A federal judge in Sacramento ordered a major power generator to continu= e=20 supplying power to California. Reliant Energy Services Inc. had insisted th= at=20 it should not be forced to sell to debt-heavy utilities unless the state=20 guaranteed the bills.=20 Chronicle staff writer Greg Lucas contributed to this story. / E-mail Lynda= =20 Gledhill at lgledhill@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- ----------------- California overcharged $5.5 bln for wholesale power=20 SACRAMENTO Calif. (AP) -- Electricity wholesalers overcharged California= =20 $5.5 billion over the past 10 months according to a report by managers of= =20 the state's power grid.=20 The five companies among other things frequently offered electricity at= =20 prices double what it cost them to produce concludes the California=20 Independent System Operator study which was published Thursday in the Los= =20 Angeles Times.=20 ``All overcharged but some excessively and some by moderate amounts'' sai= d=20 Anjali Sheffrin the ISO's director of market analysis.=20 The Times said the ISO planned to file the study with federal regulators=20 Thursday and are demanding that the money be paid back.=20 The companies denied the allegations adding they expect the Federal Energy= =20 Regulatory Commission will determine their prices were justified.=20 The commission has recently stepped up its scrutiny of power companies'=20 behavior during California's power crisis asking suppliers to justify $124= =20 million in sales during the first two months of the year or refund the mone= y.=20 Critics claim thousands of additional questionable sales are not being=20 challenged.=20 The ISO study alleges the wholesalers manipulated the market by bidding at= =20 excessive prices effectively withholding supplies or by not bidding at al= l=20 when they had generation capability available.=20 California has been spending about $45 million a day -- $4.2 billion since= =20 January -- to purchase power for Pacific Gas and Electric Co. and Southern= =20 California Edison. Both utilities the state's largest have been cut off b= y=20 electricity wholesalers because their credit is almost worthless.=20 State Controller Kathleen Connell said Wednesday that the state's=20 power-buying is gutting its budget surplus. Since the state started making= =20 emergency power buys the surplus has fallen from $8.5 billion to about $3.= 2=20 billion she said.=20 A federal judge issued a preliminary injunction Wednesday ordering a major= =20 electricity wholesaler Reliant Energy Services to continue selling to=20 California despite its fear that it will not be paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant stopped selling power to the ISO which buys it= =20 at the last minute on behalf of utilities to bolster supplies and try to fe= nd=20 off rolling blackouts.=20 Such blackouts hit the state twice this week. On Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts.=20 Standard & Poor's has put the state on a credit watch due to its power=20 purchases and chastised Gov. Gray Davis the Legislature and state regulato= rs=20 for not taking more aggressive steps to make sure the utilities can pay the= ir=20 bills.=20 Edison and PG&E say they are nearly $14 billion in debt due to soaring=20 wholesale power costs. The state's deregulation law blocks them from=20 recovering the costs from customers.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She said she would refuse to transfer $5.6 billion into a ``rainy day fund'= '=20 she said was set up to impress Wall Street as the state prepares to issue $= 10=20 billion in revenue bonds to cover its power buys. Transferring the money=20 would leave the state general fund $2.4 billion in debt Connell said.=20 She called the scope of the proposed transfer unprecedented and said it=20 amounted to a ``shell game'' that disguises the power purchases' effect on= =20 the state budget.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routin= e=20 and required by law. They put the state's budget surplus at $5.6 billion.= =20 ``The law says she has to do it. The law does not give her the power to=20 demand that kind of audit information'' Harrison said.=20 Harrison said the state's budget isn't in danger because it will be repaid= =20 with the revenue bonds.=20 Connell's criticism of Davis a fellow Democrat won support from Assembly= =20 Republicans and Secretary of State Bill Jones a Republican who may challen= ge=20 Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 ``Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency'' he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers. --- --- ---------------------------- If the power goes off=20 Thursday March 22 2001=20 For most of us rolling power blackouts are a nuisance. For some people it= =20 could mean life or death.=20 In Laguna Hills cancer patient Ruben Marquez said the blackout interrupte= d=20 and prolonged his dialysis treatment. He was unharmed the Register report= ed=20 on Monday's blackouts which hit about 1.2 million Californians including= =20 100000 Orange County homes and businesses.=20 What can people do to prevent disaster?=20 They and their families should have a backup plan Rebecca Long=20 spokesperson for the Orange County Red Cross told us.=20 The Red Cross recommends in general that you plan for this as you would fo= r=20 any disaster making sure you have battery-operated radios and flashlights.= =20 We do not recommend candles for an emergency because of the fire hazard.= =20 She recommended a Web site: www.prepare.org People with special health needs such as electric-powered respirators and= =20 oxygen machines also should register with the power company. There's a whole classification for such persons with health needs Southe= rn=20 California Edison spokesperson Clara Potes-Fellow told us. The list is for us to alert them that the power could be discontinued. The= y=20 arrange to have power through other means batteries or generators. We=20 recommend that they have a battery backup of eight hours. Therefore if the= =20 rotating outages are one hour they will have plenty. Even though the power company has such people's names she said we don't= =20 inform them in advance because we have just minutes from when the Independe= nt=20 System Operator which directs where the electrons go orders Edison to=20 implement a power outage on the grid Edison owns. By the time it took to= =20 call people the outage would be over. What's the problem at the ISO? We notify as best we can Pat Dorinson IS= O=20 director of communications told us.=20 The object is to keep the lights on. Sometimes it's just a moment's notice= =20 before a blackout. It makes [giving more notice] pretty difficult. We're= =20 looking into ways to make the system better.=20 In the meantime citizens will have to keep taking precautions. We can't help noting that free market pricing instead of politically-drive= n=20 prices would much more likely make electricity available albeit at higher= =20 prices.=20 We would expect too there would be hardship allowances donations and=20 level-pay plans to accommodate various types of needs. --- Socialized electricity=20 Thursday March 22 2001=20 Government control of state power won't add one watt for consumers' use TOM MCCLINTOCK Sen. McClintock R-Thousand Oaks represents the 19th state Senate District= =20 in the state Legislature.=20 In a city where bad ideas never die Sacramento is once again host to a=20 variety of plans for the government takeover of California's power system.= =20 The private sector it is said has done such a terrible job of providing= =20 electricity that government must now step in to save the day. Thus the=20 Legislature is awash in proposals to spend billions of dollars of public=20 money to acquire existing power facilities. Fifteen billion dollars has=20 already been authorized for this purpose and an additional $10 billion is= =20 pending in the Senate.=20 Meanwhile Gov. Davis is losing about a $1.5 billion a month day-trading in= =20 the electricity market. The irony is that after the expenditure of as much = as=20 $25 billion for public power'' not a single inch will have been added to= =20 the transmission lines nor a single watt to the generating capacity of=20 California. The root of California's crisis is a catastrophic shortage of electricity. = In=20 a shortage prices rise or blackouts occur. To reduce prices and avoid=20 blackouts the only permanent solution is to increase the supply. Merely=20 changing the ownership of existing facilities leaves Californians with=20 exactly the same shortage only billions of dollars the poorer for it.=20 Government takeover advocates argue that at least a government power=20 authority will protect consumers against price gouging and poor management.= =20 Unfortunately government power authorities don't insulate against price=20 gouging. The biggest price gouger in this entire crisis has been the Los=20 Angeles Department of Water and Power which was generating electricity for= =20 $51 per megawatt hour and selling it back to California ratepayers for as= =20 much as $1400.=20 Nor does a government takeover assure better management. Just a few years= =20 ago the LADWP was buried in $7 billion in debt. The Sacramento Municipal= =20 Utilities District was a managerial laughing stock having squandered=20 hundreds of millions of dollars for a nuclear plant it barely used. Say what you will'' the government takeover advocates reply when push= =20 came to shove the municipal utility districts of California are in great= =20 shape while the private utilities are a basket case.'' But one needs to lo= ok=20 at the reason. Ever since the state reorganized the electricity market in= =20 1996 the municipal utility districts were allowed to trade in a free marke= t=20 while the private utilities were forced to buy power exclusively in a=20 Soviet-style power exchange where the highest bid during an hour set all=20 prices. The municipal utilities were able to retain their generators. Government=20 forced the private utilities to sell theirs. The municipal utilities were= =20 able to enter into long-term contracts. Government prevented the private=20 utilities from doing the same thing. The municipal utilities were able to= =20 negotiate the lowest prices available for power. Government forced the=20 private utilities to pay the outlandish prices on the government's power=20 exchange. The municipal utilities were allowed to adjust their rates to=20 reflect the actual cost of power to consumers. Government forced the privat= e=20 utilities to sell at astronomical losses. The final argument is simply an ideological one: that power is just too=20 important to be left in private hands. Really? Food is a great deal more=20 important and private hands have kept this nation well fed for centuries.= =20 Picturing the Department of Motor Vehicles running the local supermarket=20 should sober even the most euphoric of the government takeover advocates. California's Independent System Operator is predicting a 6000-megawatt=20 shortfall this summer. When there is no electricity on the transmission=20 lines it really won't matter who owns them. During the hottest hours of th= e=20 hottest days of the year when as many as 6 million homes are without=20 electricity it may begin to dawn on most people that socialism doesn't wor= k=20 any better in California than it did in the Soviet Union. --- --- ------- NEWS=20 Bush's Energy Policy Will Backfire Feinstein Warns / She wants federal pri= ce=20 controls now Carolyn Lochhead 03/22/2001=20 The San Francisco Chronicle=20 FINAL=20 Page A.3=20 (Copyright 2001)=20 Sen. Dianne Feinstein D-Calif. warned yesterday that when blackouts=20 intensify in California this summer the pressure will intensify on the Bus= h=20 administration to explain why it rejected price controls on wholesale=20 electricity.=20 If by this summer California is as anticipated facing these blackouts a= nd=20 the federal government won't help I don't think the American people are=20 going to be very pleased Feinstein told California reporters.=20 Asked if help means the cost-based price controls Feinstein is pushing she= =20 said Right now yes.=20 Feinstein said California Democrats will begin to escalate their criticism = of=20 the administration predicting that support will build among Western senato= rs=20 for her legislation to impose price caps on wholesale electricity in exchan= ge=20 for lifting the rate cap on California consumers.=20 If it passes she said the administration is really going to have to face= =20 whether they're going to help or not help.=20 Feinstein said House Democrats from the West Coast also told her they expec= t=20 that White House inaction on price caps would help them gain seats in 2002.= =20 But she refused to speculate on the political fallout from the energy crisi= s=20 against Democrats in California .=20 Feinstein characterized Energy Secretary Spencer Abraham's adamant argument= s=20 against price controls as recalcitrant saying his statement to a Senate= =20 committee last week essentially said California 's on its own.=20 She speculated that because California is dominantly Democratic even=20 somebody like me that works across party lines is beginning to wonder if th= is=20 isn't an unnecessarily barbed stick at California .=20 White House spokesman Ken Lisaius disputed the charge saying the Bush=20 administration is doing all it can but can't control that demand is=20 outstripping supply.=20 The federal government cannot prevent blackouts but can only help at the= =20 margins in situations like this Lisaius said. The only thing that can=20 prevent blackouts is reduced demand increased supply and good weather.=20 Abraham has twice in the last week argued strongly against price controls= =20 including the cost-based ones Feinstein advocates saying they could increa= se=20 blackouts by discouraging power sales into the Western electricity grid.=20 He also said many power providers including the federal Bonneville Power= =20 Administration in the home district of Sen. Gordon Smith the Oregon=20 Republican co-sponsoring Feinstein's bill would be exempt from federal pri= ce=20 caps. Feinstein disputed that but Smith's office agreed.=20 Abraham argued that price controls would not work in part because roughly= =20 half the Western electricity market would be exempt including federal powe= r=20 marketing authorities such as Bonneville rural electric cooperatives and= =20 municipal utilities such as the Los Angeles Department of Water and Power.= =20 On another front House Republicans omitted from their budget projected=20 revenues from opening part of the Arctic National Wildlife Refuge to oil an= d=20 gas exploration.=20 A Budget Committee spokeswoman said Chairman Jim Nussle R-Iowa determined= =20 that the $1 billion in revenues from the wildlife refuge the Bush=20 administration included in its budget were not needed and that there was n= o=20 reason to put in something that controversial that some of our members don= 't=20 even like when you don't have to.=20 But Rep. Gary Miller R-Diamond Bar (Los Angeles County) said House=20 Republicans are not backing off at all from opening the wildlife refuge t= o=20 drilling. Our goal is to get it passed in the House he said saying the= =20 Budget Committee omitted the revenue projections because the drilling has n= ot=20 yet been approved.=20 PHOTO Caption: Sen. Dianne Feinstein wants to cap wholesale electricity=20 costs and end caps on con- sumer rates.=20 --- ------ Reliant Still In Power Pact Talks With Calif. DWR=20 By Christina Cheddar 03/22/2001=20 Dow Jones News Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 Of DOW JONES NEWSWIRES=20 =20 (This report was originally published late Wednesday.)=20 =20 NEW YORK -(Dow Jones)- Reliant Energy Inc. (REI) remains in discussions wit= h=20 the California Department of Water Resources to sign long-term power=20 contracts.=20 However issues regarding the creditworthiness of the agency remain said J= oe=20 Bob Perkins president of Reliant's Wholesale Division.=20 We want to be part of the solution Perkins said. At the same time Relia= nt=20 is trying to protect itself from incurring additional unpaid accounts=20 receivable he said.=20 The DWR has been buying power on behalf of California 's financially troubl= ed=20 utilities. However Reliant has yet to sign a formal agreement with the=20 agency because Reliant is concerned it won't be paid.=20 During a conference call Wednesday Perkins said he couldn't comment on a= =20 lawsuit between Reliant and the California Independent System Operator=20 because he didn't know how it was progressing.=20 Further court action on the case is expected Wednesday.=20 The lawsuit stems from Reliant's desire not to be required to sell power to= =20 California if the state won't guarantee payment. The Houston energy company= =20 is concerned that it won't be paid for power being bought by the ISO on=20 behalf of Edison International's (EIX) Southern California Edison unit and= =20 PG&E Corp.'s (PCG) Pacific Gas & Electric Co. unit.=20 To date Reliant is owed some $370 million from unpaid power sales to the= =20 utilities.=20 Much of Perkins' presentation centered on how the power crisis in Californi= a=20 emerged.=20 Using data from research firm Cambridge Energy Research Associates the=20 company discussed the imbalance between California 's power demand and its= =20 power supply.=20 Looking ahead to the summer it isn't a question of whether rolling blackou= ts=20 will occur but how many and how severe Perkins said.=20 Low hydroelectric availability loss of imported power warm weather deman= d=20 growth and plant outages could lead to a worst-case scenario in California = =20 he said adding that some estimates predict California could experience 11= 00=20 hours of power outages this summer.=20 The skyrocketing power prices in the region are a reflection of the power= =20 market's imbalance he said.=20 Reliant submitted only economically sound bids for power Perkins said. H= e=20 expects the company can document why it charged the prices it did as requir= ed=20 by regulators.=20 We have been very rigorous and very disciplined in what we have submitted= =20 Perkins said.=20 He added that retail customer price increases are one way of sending a sign= al=20 to consumers to lower consumption. He cited studies that show a 20% retail= =20 price increase could reduce consumption by 2000 megawatts. A megawatt is= =20 enough power to serve roughly 1000 homes.=20 -By Christina Cheddar Dow Jones Newswires 201-938-5166=20 --- ------ CPUC Must Address Rates In QF Repayment Order - SoCal Ed 03/22/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 (This article was originally published Wednesday)=20 =20 LOS ANGELES -(Dow Jones)- Any order from the California Public Utilities=20 Commission requiring utilities to pay small independent generators going= =20 forward must determine how that could be done within the existing rate=20 structure a spokesman for Edison International (EIX) utility Southern=20 California Edison said Wednesday.=20 The utility was responding to a PUC proposed decision that would require=20 utilities to pay small generators called qualifying facilities $79 a=20 megawatt hour within 15 days of electricity delivery. The decision will be= =20 voted March 27 by the CPUC.=20 We're still reviewing (the decision) and should have more to say in a day = or=20 two. To the extent that the commission orders us to pay going forward of=20 course we will. But it needs to address how we will pay the QFs a SoCal= =20 Edison spokesman said.=20 SoCal Edison and PG&E Corp. (PCG) unit Pacific Gas & Electric Co. are=20 struggling under nearly $13 billion in uncollected power costs due to an=20 inability to pass high wholesale power costs to customers under a rate=20 freeze.=20 Gov. Gray Davis Tuesday blasted the utilities for not having paid their QF= =20 bills in full since December. Pacific Gas & Electric Co. has made some=20 partial payments to QFs but SoCal Edison has paid nothing. Together they= =20 owe the QFs about $1 billion but the order doesn't address that debt.=20 An Edison executive said in reaction to the governor's sharp comments tha= t=20 the company simply doesn't have the money to pay creditors.=20 The root problem here is there just isn't enough money in the current rate= =20 base to pay our bills said Edison Senior Vice President of Public Affairs= =20 Bob Foster. We understand the financial distress (the QFs) face we are=20 facing financial distress ourselves.=20 The proposed PUC order would also require the state's investor-owned=20 utilities to offer the small generators five- and 10-year contracts for pow= er=20 for $79/MWh and $69/MWh respectively.=20 The QFs may be able to live with the PUC proposal but the five- and=20 10-year contract prices may be inadequate if natural gas prices at one of t= he=20 California borders are high said Jan Smutny-Jones president of the=20 Independent Energy Producers Association. Natural gas prices into Californi= a=20 are currently higher than anywhere in the country.=20 But some say the proposed decision may not be enough to prevent the QFs fro= m=20 filing involuntary bankruptcy proceedings against the utilities for the mon= ey=20 they are still owed.=20 There's still a lot of skepticism. To say our position has changed based o= n=20 the CPUC decision or the governor's announcement is not accurate. A lot sti= ll=20 has to happen said Jay Lawrence a spokesman for a renewable creditors=20 committee.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 --- ------ Calif Small Pwr Producers To Shut Plants If Rates Capped By Jason Leopold 03/22/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 Of DOW JONES NEWSWIRES=20 =20 (This article was originally published earlier Thursday.)=20 =20 LOS ANGELES -(Dow Jones)- Many of California 's independent power producers= =20 late Wednesday threatened to take their small power plants offline this wee= k=20 if state lawmakers pass legislation that would cap the rates the generators= =20 charge for electricity they sell directly to the state's three investor-own= ed=20 utilities.=20 At issue is a bill that would repeal a section of the state's Public=20 Utilities Code which links the 688 so-called qualifying facilities'=20 electricity rates to the monthly border price of natural gas.=20 Lawmakers however are poised to pass the legislation.=20 State regulators are then expected to approve a measure that would=20 restructure the fluctuating rates the QFs charge PG&E Corp. (PCG) unit=20 Pacific Gas & Electric Edison International (EIX) unit Southern Californi= a=20 Edison and Sempra Energy (SRE) unit San Diego Gas & Electric from $170 a= =20 megawatt-hour to $69-$79/MWh regardless of the price of natural gas.=20 Whereas each of the 688 QF contracts differed largely because natural gas= =20 prices are higher in Southern California than Northern California the sta= te=20 wants the QFs to sign a general contract with the utilities.=20 The cogeneration facilities which produce about 5400 megawatts of=20 electricity in the state said the rates are too low and they won't sign ne= w=20 supply contracts with the utilities.=20 For $79/MWh natural gas would have to be $6 per million British thermal= =20 unit at the Southern California border said Tom Lu executive director of= =20 Carson-based Watson Cogeneration Company the state's largest QF generatin= g=20 340 MW. Our current gas price at the border is $12.50.=20 Other gas-fired QFs said the state could face another round of rolling=20 blackouts if lawmakers and state regulators pass the legislation which is= =20 expected to be heard on the Senate floor Thursday and allow it to be=20 implemented by Public Utilities Commission next week.=20 Lu whose company is half-owned by BP Amoco PLC (BP) and is owed $100 milli= on=20 by SoCal Ed said the proposals by the PUC and the Legislature will only= =20 make things worse.=20 David Fogarty spokesman for Western States Petroleum Association whose=20 members supply California with more than 2000 MW said the utilities need = to=20 pay the QFs more than $1 billion for electricity that was already produced.= =20 =20 State Loses 3000 MW QF Output Due Of Financial Reasons=20 =20 The QFs represent about one-third or 9700 MW of the state's total power= =20 supply. Roughly 5400 MW are produced by natural gas-fired facilities. The= =20 rest is generated by wind solar power and biomass.=20 About 3000 MW of gas-fired and renewable QF generation is offline in=20 California because the power plant owners haven't been paid hundreds of=20 millions of dollars from cash-strapped utilities SoCal Ed and PG&E for near= ly=20 four months.=20 Several small power plant owners owed money by SoCal Ed have threatened to= =20 drag the utility into involuntary bankruptcy if the utility continues to=20 default on payments and fails to agree to supply contracts at higher rates.= =20 The defaults have left many of the renewable and gas-fired QFs unable to=20 operate their power plants because they can't afford to pay for the natural= =20 gas to run their units. Others continue to produce electricity under their= =20 contracts with the state's utilities but aren't being paid even on a forwar= d=20 basis.=20 The California Independent System Operator keeper of the state's electrici= ty=20 grid said the loss of the QF generation was the primary reason rolling=20 blackouts swept through the state Monday and Tuesday.=20 Gov. Gray Davis recognizing the potential disaster if additional QFs took= =20 their units offline held marathon meetings with key lawmakers Monday and= =20 Tuesday to try and hammer out an agreement that would get the QFs paid on a= =20 forward basis and set rates of $79/MWh and $69/MWh for five and 10 year=20 contracts. He also said he would direct the PUC to order the utilities to p= ay=20 the QFs for power they sell going forward.=20 After next week the QF problem will be behind us Davis said Tuesday. We= =20 want to get the QFs paid...the QFs are dropping like flies...and when that= =20 happens the lights go out.=20 But this just makes the problem worse said Assemblyman Dean Florez=20 D-Shafter a member of the Assembly energy committee.=20 I don't know how we are going to keep the lights on Florez said in an=20 interview. Many of these congenerators are in my district. They said if th= e=20 legislation doesn't change they are going offline. This compounds the issue= =20 of rolling blackouts especially now when we need every megawatt.=20 Davis who didn't meet with people representing the QFs said he was handin= g=20 the QF issue to the PUC because lawmakers failed to pass legislation that= =20 would have set a five-year price for natural gas and allow the QFs to sign= =20 individual contracts with the utilities. In addition SOCal Ed opposed the= =20 legislation saying the rates should be below $50/MWh.=20 Some renewable power producers said they aren't vehemently opposed to the n= ew=20 rate structure because it guarantees them a higher rate than what was=20 originally proposed.=20 =20 QFs Want Third Party Supply Contracts=20 =20 John Wood who represents the SoCal Ed Gas Fired Creditors Committee one o= f=20 a handful of groups that have formed since January to explore options on=20 getting paid by the utilities said his group of gas-fired QF creditors wan= t=20 to be released from their supply contracts and sell to third parties.=20 Under our plan we would be permitted to sell electricity to third parties= =20 (including the state Department of Water Resources) until a resolution to t= he=20 crisis can be accomplished wood said.=20 Hal Dittmer president of Sacramento-based Wellhead Electric in Sacramento= =20 which is owed $8 million by PG&E has 85 MW of gas-fired generation units= =20 offline.=20 Under the state's plan Dittmer said he risks going out of business.=20 I can't buy natural gas for what I would be paid under this decision he= =20 said. The state needs to quit kidding themselves that they don't need to= =20 raise electricity rates. All of this is being driven by an artificial=20 construct that California can avoid raising rates.=20 =20 -By Jason Leopold Dow Jones Newswires 323-658-3874=20 jason.leopold@dowjones.com=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Ken Lay Statement to Employees on Bush CO2 Policy Body:: The revised statement looks good to me. Catherine McKalip-Thompson@ENRON COMMUNICATIONS 03/23/2001 12:30 PM To: Rob Bradley/Corp/Enron@Enron Jeffrey Keeler/Corp/Enron@ENRON cc: Ann M Schmidt/Corp/Enron@Enron Lauren Iannarone/NY/ECT@ECT@ENRON Michael Terraso/OTS/Enron@Enron Steven J Kean/NA/Enron@Enron Subject: Re: Ken Lay Statement to Employees on Bush CO2 Policy Rob After reviewing both Lauren's and Jeff's comments I have little to add. I would however replace the last part of Jeff's sentence in the first paragraph with and there is a need to take a comprehensive look at strategies for reducing CO2 emissions more broadly in ways that make economic and environmental sense to avoid mentioning the Kyoto Protocol directly. And I'd like to reiterate Lauren's suggestion that the article should direct employees to our climate change policy statement in last year's EHS Report and that Lay encourages them to research and reflect on the issue and communicate their thoughts. Thanks Catherine Catherine McKalip-Thompson Manager Environmental Responsibility Enron Corp. 101 California Street Suite 1950 San Francisco CA 94111 Tel: 415.782.7842 Fax: 415.782.7854 Jeffrey Keeler@ENRON 03/23/01 08:35 AM To: Rob Bradley/Corp/Enron@ENRON cc: Ann M Schmidt/Corp/Enron@Enron Lauren Iannarone/NY/ECT@ECT Michael Terraso/OTS/Enron@Enron Steven J Kean/NA/Enron@Enron Catherine McKalip-Thompson/Enron Communications@Enron Communications Subject: Re: Ken Lay Statement to Employees on Bush CO2 Policy Rob: Here are my edits below in bold. Sorry to re-write so much -- but I believe this is consistent with Steve's conversation with Ken and with the media interviews he has given to date as well as our advocacy on multipollutant and climate change. Jeff Jeffrey Keeler Director Environmental Strategies Enron Washington DC office - (202) 466-9157 Cell Phone (203) 464-1541 Rob Bradley 03/23/2001 10:14 AM To: Jeffrey Keeler/Corp/Enron cc: Michael Terraso/OTS/Enron@ENRON Steven J Kean/NA/Enron@Enron Lauren Iannarone/NY/ECT@ECT Ann M Schmidt/Corp/Enron@ENRON Subject: Ken Lay Statement to Employees on Bush CO2 Policy (KEELER EDITS) Here is my draft for Ken in response to Ann's eBiz request. Comments welcome The President after a good deal of study and soul searching decided not to support mandatory controls on carbon dioxide (CO2) emissions from power plants as part of a multipollutant clean air strategy. His decision was based on some very important factors -- the nation's energy markets are experiencing unprecedented supply and price challenges that any CO2 mandate could exacerbate and U.S. regulation of CO2 in the near-term could be ill-advised because the Kyoto protocol on global treatment of greenhouse gas emissions is unworkable in its current form. I was somewhat concerned that the message sent by the Bush administration would polarize the debate over how the U.S. should treat CO2 emissions in the long term as his statement did provoke a very negative anti-environment reaction by many concerned individuals and organizations. Because this is an important issue to all parties on all sides of the debate I believe that the administration should convene an ongoing process to carefully examine global climate change and all the long-term economic scientific and social impacts of action regulate CO2 emissions. The President's position on CO2 notwithstanding Enron continue to be a private sector leader in offering real solutions towards reducing greenhouse gas emissions in a rapidly expanding energy market. We are well-positioned through our experience with low-carbon fuels for electric generation (natural gas and wind in particular) our focus on new power generation and tecnologies our leadership position in promoting efficiency through Enron Energy Services' energy outsourcing business and our expertise in emissions trading and risk management. A multipollutant appraoch to reducing power plant emissions makes a lot of sense from and environmental and energy policy standpoint. Enron will continue to work with the Bush administration and Congress toward structuring a program that can achieve environmental goals while providing incentives to build cleaner more efficient generation promoting a broad mix of fuels and tecnologies and giving industry the flexibility and economic incentives to make reductions in a market-based cost-effective way. If we're able to make meaningful reductions in 3 pollutants -- NOx SO2 and mercury -- and we do it in a way that promotes efficiency and new technology we'll make progress on CO2 whether it is regulated or not. In the meantime I will remain active in the global climate change debate to position Enron as a constructive player in the public policy arena and as an industry leader in promoting market-driven solutions to the world's energy and environmental problems. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Crisis Update (No. 10) Body:: We have been pulling together these weekly(sometimes more often) summaries for internal purposes. Would you find it helpful to be on the distribution list? Hope you are doing well. Look forward to touching base soon. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Rick, Malcolm, Mark, Lyndon meet with Steve, Dan to call in after his radio interview. Body:: General Staff Meeting What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: California Refund Proceeding--Got some exhibits to prepare--Confidential Atty Client Work Product Body:: I think the best person to provide the affidavits for the PX Credit receivable is Wanda Curry (if we want to make this claim inside of the FERC proceeding - still an open question). Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: IEP News 5/29 Body:: Today's IEP news ... Los Angeles Times May 27 2001 Sunday Home Edition Page 7 615 words ????The State ?Who Let the Hot Dogs Out? Rhapsodic Lawmakers Legislature: ????Speaking frankly officials have used the wiener as an easily digestible ????metaphor for the state's energy crisis. JULIE TAMAKI MIGUEL BUSTILLO ????TIMES STAFF WRITERS SACRAMENTO (Quotes Smutny on behalf of IEP) The San Francisco Chronicle MAY 26 2001 SATURDAY FINAL EDITION NEWS ????Pg. A1 835 words Davis asks U.S. to limit firms' prices ???RATE SWINGS: ????Governor argues 2 generators manipulated market Lynda Gledhill Sacramento (Quotes ??????? ???Smutny on ?behalf of IEP) The Wall Street Journal Power Drain: The U.S. Energy Crisis California Officials Say State Will ?? ???Enter A Recession Without Energy Price Caps By JOHN R. EMSHWILLER Staff Reporter of THE ?? ???WALL STREET JOURNAL AP Online May 29 2001 Tuesday 9:11 AM Eastern Time Domestic ????non-Washington general news item 770 words AP Top News at 9:10 a.m. EDT ????Tuesday May 29 2001 JEROME MINERVA The Dallas Morning News May 29 2001 Tuesday DOMESTIC NEWS K7523 1046 ????words Bush begins visit in hostile California By G. Robert Hillman Los Angeles Times May 29 2001 Tuesday Home Edition Page 1 1178 words ????Governor to Stress Price Caps to Bush Power: In a meeting today with the ????president Davis will present a letter from economists backing cost controls ????and demand federal assistance. DAN MORAIN JAMES GERSTENZANG TIMES STAFF ????WRITERS Los Angeles Times May 29 2001 Tuesday Home Edition Page 1 1541 words ????THE ENERGY CRISIS Kern County Basks in Role as State's Blackout-Buster ????Electricity: Six new plants will bolster its status as energy center. ????MITCHELL LANDSBERG TIMES STAFF WRITER McKITTRICK Calif. The New York Times May 29 2001 Tuesday Late Edition - Final Section A ????Page 12 Column 1 National Desk 1078 words For Crucial California Trip ????Bush Calibrates How Best to Handle State's Energy Crisis By DAVID E. SANGER ???? LOS ANGELES May 28 The Orange County Register May 29 2001 Tuesday DOMESTIC NEWS K7500 ????825 words California's power crisis generating lots of heat By John Howard The San Francisco Chronicle MAY 29 2001 TUESDAY FINAL EDITION NEWS ????Pg. A1 1291 words Crisis no sweat to some offices ???Many offices keep ????cool in crisis ???Air conditioners blast in state's energy centers Steve ????Rubenstein The San Francisco Chronicle MAY 29 2001 TUESDAY FINAL EDITION NEWS ????Pg. A1 1238 words Bush facing Davis' heat over energy ???In first visit ????to state as president he'll hear governor's plea for help Carla Marinucci ????Lynda Gledhill USA TODAY May 29 2001 Tuesday FIRST EDITION NEWS Pg. 3A 426 words ????Davis to urge Bush to back electricity price cap Laurence McQuillan LOS ????ANGELES The Washington Post May 29 2001 Tuesday Final Edition A SECTION Pg. ????A02 639 words Energy Chief Moves To Aid California Transmission Plan ????Precedes Bush Visit Mike Allen Washington Post Staff Writer LOS ANGELES ????May 28 The Washington Post May 29 2001 Tuesday Final Edition A SECTION Pg. ????A03 1936 words It's Still Dawn for Solar Power in L.A. Despite City ????Subsidies Homeowners Hesitate to Install Expensive Alternative Energy ????Source William Booth Washington Post Staff Writer LOS ANGELES The Washington Times May 29 2001 Tuesday Final Edition PART A NATION ????INSIDE POLITICS Pg. A6 1264 words Greg Pierce THE WASHINGTON TIMES The Washington Times May 29 2001 Tuesday Final Edition PART A NATION ????Pg. A4 809 words Bush faces tough sell on visit to California ?Davis ????likely to be rebuffed on price caps Joseph Curl THE WASHINGTON TIMES LOS ????ANGELES Chicago Tribune May 29 2001 Tuesday NORTH SPORTS FINAL EDITION News ????Pg. 6 ZONE: N 514 words Bush backs WW II project From Tribune news ????services. LOS ANGELES The Associated Press May 29 2001 Tuesday BC cycle 7:55 AM Eastern Time ???? Domestic News 604 words Bush announcing low-income aid but no price ????caps By SCOTT LINDLAW Associated Press Writer LOS ANGELES The Associated Press State & Local Wire May 29 2001 Tuesday BC cycle ????7:31 AM Eastern Time State and Regional 594 words Stakes are high for ????Davis meeting with Bush By GARY GENTILE AP Business Writer LOS ANGELES ABC NEWS WORLD NEWS NOW (2:00 AM ET) May 28 2001 Monday 447 words ????PRESIDENT BUSH VISITS CALIFORNIA WHERE POLITICIANS ARE CRITICAL OF HIS LACK ????OF ACTION FOR THEIR ENERGY CRISIS DEREK McGINTY JOSH GERSTEIN Los Angeles Times May 27 2001 Sunday ?Home Edition SECTION: California Part 2 Page 7 Metro Desk LENGTH: 615 words HEADLINE: The State Who Let the Hot Dogs Out? Rhapsodic Lawmakers Legislature: Speaking frankly officials have used the wiener as an easily digestible metaphor for the state's energy crisis. BYLINE: JULIE TAMAKI MIGUEL BUSTILLO TIMES STAFF WRITERS DATELINE: SACRAMENTO BODY: ??Every crisis has its symbol. ??Watergate had Deep Throat. The S&L scandal had Charles Keating. O.J. did--or didn't--have a bloody glove. ??Here in the Capitol the hot dog has become an unlikely metaphor for the state's energy crisis. ??In packed news conferences and heated Assembly floor debates lawmakers from both parties have evoked images of the ordinary dog to help explain an extraordinary mess. ??The genesis of this statehouse trend is difficult to determine. Assemblyman Fred Keeley appears to be the first to have tossed the hot dog into the political fire. ??During a crucial Assembly discussion in January the Boulder Creek Democrat recited the lyrics to a familiar Oscar Mayer jingle as a way of admitting that a controversial bill to have the state buy electricity to avoid blackouts was unpalatable but necessary. ??It's the dog kids love to bite said Keeley of the jingle. Well this is the bill people love to hate. ??A bizarre partisan hot dog duel ensued. Assemblyman John Campbell (R-Irvine) responded by likening the unpredictable financial consequences of the Keeley legislation to biting recklessly into mystery meat. ??Before I bite into it I see what's on the outside but I can't see the inside Campbell said. If nobody can tell me what's on the inside it may be bitter it may be bad it may make me sick. ??Assemblywoman Carole Migden (D-San Francisco) angrily fired back wanting to know why Campbell a professed hot dog eater was suddenly so critical of its unknown contents. ??It's OK to eat a hot dog that's full of animal bones and hair Migden said. That's a hot dog that's OK with you but this kind of hot dog isn't. ??Yet it was Senate leader John Burton who made it the key ingredient in a Capitol catch phrase. ??Burton described a plan to purchase the electrical power grid from the state's private utilities as a fair swap saying: I give you a dollar you give me a hot dog. ??The sound-bite quickly took on a life of its own. With the cost of the energy crisis growing faster than the price of ballpark franks critics doubted the public's appetite for a multibillion-dollar hot dog. ??Do you really want a hot dog? That is the question said Jan Smutny-Jones executive director of the Independent Energy Producers a trade group for power generators. ??Not content to let a dog lie in its bun lawmakers such as Assemblyman Bill Leonard (R-San Bernardino) kept the hot dog in public discourse. ??When Pacific Gas & Electric Co. filed for bankruptcy protection Leonard was one of a chorus of legislators who questioned the merits of purchasing the remaining portion of the power lines calling it not even half a hot dog. ??Added Assemblyman Bill Campbell (R-Villa Park): It's like paying Mercedes prices for a broken down hot dog cart. ??In recent weeks the hot dog rhetoric appeared to have gone cold. Then Assemblyman Juan Vargas (D-San Diego) revived it. ??After enduring hours of testimony on details of the deal to purchase Edison's power lines Vargas said his opinion of the dollar-equals-hot-dog deal had diminished. ??They're trying to charge us for a hot dog Vargas said of the utility but it looks like we're only going to be getting a wienie. ??Reliant Vice President John Stout also recently weighed in with his own hot dog analogy as he tried to explain why his company's income had jumped so much during the crisis. ??If you have a hot dog stand and you go out and buy five to six more hot dog stands Stout said referring to his company's purchase of power plants then naturally you would expect the operating income to go up. ??Alas the dog days of summer have yet to begin. LOAD-DATE: May 27 2001 of 4 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????MAY 26 2001 SATURDAY FINAL EDITION SECTION: NEWS Pg. A1 LENGTH: 835 words HEADLINE: Davis asks U.S. to limit firms' prices RATE SWINGS: Governor argues 2 generators manipulated market SOURCE: Chronicle Sacramento Bureau BYLINE: Lynda Gledhill DATELINE: Sacramento BODY: Gov. Gray Davis pursued a new strategy yesterday to control wholesale electricity costs by demanding that federal regulators ban two generators from selling power in California at market rates arguing that they have manipulated the market to their advantage. ???Meanwhile the Davis administration lambasted a federal plan to implement temporary price controls scheduled to go into effect Tuesday. State officials said the measures would do nothing to tame California's out-of-control costs for electricity. ???Davis whose calls for broader price limits on wholesale electricity have been rejected repeatedly by the Federal Energy Regulatory Commission is scheduled to meet with President Bush next week to ask Washington to do more to help California. ???Federal regulators said that prices were 'unjust and unreasonable' nearly nine months ago but they have been AWOL ever since Davis said in a statement. ???The California Independent System Operator managers of the state's electrical grid asked energy regulators yesterday to revoke the authority they have given Williams Energy and AES Inc. to sell power at market-based rates. Instead the Davis administration wants the companies to be forced to sell at cost-plus rates which would ensure a reasonable but limited profit. ???Market-based rate authority is not an entitlement the ISO said in a filing with federal regulators. ???The ISO asked regulators to act by June 15 saying that any delay places California consumers and the state's economy at extreme peril. ???Similar filings against other companies such as Mirant Duke and Reliant are being considered said Charles Robinson general counsel for the ISO. ???Robinson said the ISO has a well developed record of price manipulation by the two companies. He said information previously given to federal regulators proved the prices charged to California were excessive. ???'GRANDSTANDING' ACCUSATION ???Aaron Thomas a spokesman for Virginia-based AES said the administration is grandstanding. ???This is akin to the rhetoric the governor has used for the past several months he said. We are well below the index FERC uses to establish concerns about market power. ???As to this rhetoric about these companies abusing the marketplace -- check the facts. We lost money last year Thomas said. ???A spokeswoman for Williams said the company would not comment because it had not seen the filing. ???Earlier this month Oklahoma-based Williams agreed to pay $8 million to settle charges with FERC that the company was purposely withholding electricity from California's power market. The company admitted no wrongdoing and officials said a full hearing would have cleared the company. ???If the regulatory commission denies the state's requests or doesn't act in the time frame we believe is necessary to prevent harm the state can appeal to a circuit court Robinson said. ???BUSH VISIT POSTURING CHARGE ???Jan Smutny-Jones head of the Independent Energy Producers Association said the move is posturing by Davis ahead of Bush's visit. ???This is an interesting welcome mat for President Bush he said. Do we want a dialogue or a diatribe? ???In advance of Bush's visit Vice President Dick Cheney said yesterday that nothing more can be done to help solve California's power problems this summer. ???He also rejected price controls saying that previous efforts have contributed to a supply shortage. ???A spokesman for Davis rejected that notion and denied that the timing of yesterday's announcements were connected to the Bush-Davis meeting. ???Davis aides expressed hope that Bush's two new FERC commissioners Pat Wood III a close Bush ally expected to take over the chairmanship of the board and Nora Mead Brownell a state utility regulator in Pennsylvania would hear California's pleas. The two new commissioners were confirmed yesterday by the U.S. Senate. ???Among the things Davis wants changed is the regulatory commission temporary price relief plan scheduled to take effect Tuesday. ???The regulators would limit wholesale prices during power alerts in California when reserves drop below 7 percent of available capacity. ???Many state officials believe that doesn't go far enough. The state Assembly in documents to be filed Tuesday said price controls should cover all hours -- not just power emergencies. ???And there is a chance the controls will be in effect for just a few days. Under the regulatory commission plan the state and the three investor-owned utilities must file a proposal to join a regional transmission organization by June 1. If they do not to do so the price controls disappear. ???Davis administration officials expect to file another response dealing with the regional transmission organization by Friday Robinson said. The Assembly filing rejects joining such an organization which federal officials favor as a means to better manage and improve grid capacity in the West. E-mail Lynda Gledhill at lgledhill@sfchronicle.com. GRAPHIC: PHOTO Vice President Dick Cheney said nothing more can be done to help solve California's power problems. / New York Times LOAD-DATE: May 26 2001 May 29 2001 Power Drain: The U.S. Energy Crisis California Officials Say State Will Enter A Recession Without Energy Price Caps By JOHN R. EMSHWILLER Staff Reporter of THE WALL STREET JOURNAL On the eve of a meeting Tuesday between President George Bush and California Gov. Gray Davis top advisers to the governor said the state could be pushed into recession unless the federal government imposes temporary price caps to contain soaring wholesale electricity costs. President Bush has consistently opposed price caps. The governor's team called a Memorial Day news conference to highlight what they saw as the dangers to the economy of the state and possibly the nation from the tens of billions of dollars being spent this year to purchase electricity. The governor's aides estimated that statewide wholesale electricity purchases this year could hit $50 billion compared with about $7 billion in 1999. Some estimates for this year's power expenditures are even higher. If California were a separate nation an energy shock of that magnitude would be expected to cause a significant recession said Alan Blinder a former vice chairman of the Federal Reserve at the conference. While being part of a broader national economy could somewhat mitigate the impact the higher power costs are a recipe for stagflation in California added Mr. Blinder. Stagflation refers to stagnant economic conditions and inflation -- a condition that struck the nation when energy prices soared in the 1970s. Though the advisers painted perhaps the dreariest outlook yet to come from the governor's office they said that the Davis plan for financing the state's electricity purchases remains intact. As reported the state plans to sell about $12.5 billion in bonds later this year. The state has been purchasing electricity since January when its failed utility-deregulation plan left California's two biggest utilities financially unable to continue buying power. If price caps were instituted the state might have to borrow less money than anticipated or at least face a decreased danger of having to borrow more if the power situation gets worse said Joseph Fichera chief executive of New York-based Saber Partners LLC and an adviser to Mr. Davis. The governor plans to press his case for price caps over the next six to 18 months as supplies are increased with new power plants due to come into operation the advisers said. However Mr. Bush and other federal officials have repeatedly said that they believe price caps would be counterproductive and discourage the building of new power plants. Write to John R. Emshwiller at john.emshwiller@wsj.com1 Copyright 2001 Associated Press AP Online ?????????????????May 29 2001 Tuesday 9:11 AM Eastern Time SECTION: Domestic non-Washington general news item LENGTH: 770 words HEADLINE: ?AP Top News at 9:10 a.m. EDT Tuesday May 29 2001 BYLINE: JEROME MINERVA BODY: ??NATO Won't Back U.S. Missile Plan ??BUDAPEST Hungary (AP) ??NATO's top policy-making body stopped short of endorsing the Bush administration's plan for a national missile defense today preparing to offer only to ''continue substantive consultations'' with Washington. The North Atlantic Council does not portray the possibility of missile attack as a common threat faced by allies as the Bush administration had hoped it said in a statement. Secretary of State Colin Powell had hoped to persuade skeptical NATO allies to be more supportive of U.S. missile defense plans. ??Pakistan Accepts India Offer to Talk ??ISLAMABAD Pakistan (AP) ??Pakistani military ruler Gen. Pervez Musharraf today accepted India's offer to hold peace talks on the disputed Kashmir region and other issues. ''I accept your invitation ... to visit India with great pleasure'' Musharraf said in a letter to Indian Prime Minister Atal Bihari Vajpayee. ''We wish to see a stable prosperous India at peace with its neighbors.'' Musharraf's letter came four days after Vajpayee broke a two-year lull in high-level talks between the two rival nuclear powers by inviting the Pakistani leader to India. ??Consumers' Spending Incomes Rise ??WASHINGTON (AP) ??Consumers spent on services in April but cut back on cars and other big-ticket items. Incomes also rose. The Commerce Department reported today that consumer spending rose by 0.4 percent in April following a 0.2 percent increase the month before. April's rise marked the biggest increase since January. Consumer spending accounts for two-thirds of all economic activity and has been a main pillar propping up the country's fragile economy. Personal incomes rose 0.3 percent. ??Bush Won't Cap Electricity Prices ??LOS ANGELES (AP) ??President Bush says he won't force down soaring electricity prices that have cost California nearly $8 billion since January. The Republican president and embattled Democratic Gov. Gray Davis arranged a meeting today to talk about the state's energy crisis but there was no indication they would break their stalemate. Bush opposes price limits on wholesale electricity that utilities buy arguing they do nothing to address supply-and-demand issues at the heart of the crisis. ??Tornado Injures 18 in Colorado ??ELLICOTT Colo. (AP) ??Dozens of residents of a sparsely populated town in southern Colorado spent the night in a church after a tornado crushed trailer homes sprayed hail and injured 18 people. ''We just hit the floor in the living room and covered the kids and the tornado hit'' said Trish Davidson whose mobile home was lifted into the air and dropped 10 feet from its foundation. Davidson and about 30 other people spent last night in the basement of a church. Power was out to the church and much of the surrounding area. ??Israeli Motorist Killed ??JERUSALEM (AP) ??An Israeli motorist was killed in a West Bank drive-by shooting today as Israeli and Palestinian officials after two rounds of U.S. mediation spoke of resuming security talks aimed at reducing the violence. The motorist died of head wounds shortly after he was shot on by Palestinian gunmen from a passing car near the West Bank city of Nablus the army said. Two Israeli settlers were shot and injured one seriously in another West Bank ambush last night. ??Record-Breaking DJ Still on Air ??JERSEY CITY N.J. (AP) ??Now you can't get disc jockey Glenn Jones off the air. As of 6:30 a.m. EDT today the DJ had been talking for about 93 hours easily shattering the record for the longest continuous radio broadcast. And he was still talking. ''It's been a test of wills a test of determination'' Jones said. ''The first day was the hardest but we're still going strong.'' Jones said he wanted to remain on the air until he hit the 100-hour mark which would be about 1 p.m. EDT and would then decide whether to continue. ??Nikkei Adds 36 Points ??TOKYO (AP) ??Tokyo stocks rose moderately today in light trading following holidays in the United States and Britain. The Nikkei Stock Average gained 36.12 points to close at 13773.89. ??Agassi Capriati Open With Wins ??PARIS (AP) ??Andre Agassi and Jennifer Capriati began their bids for a second consecutive Grand Slam title winning in straight sets today on the second day of the French Open. Agassi who won the French Open in 1999 beat Sweden's Thomas Johansson 6-2 6-3 7-6 (5). Capriati seeded fourth overcame seven double faults in defeating France's Emilie Loit 6-2 7-5. Both Agassi and Capriati won Australian Open titles earlier this year. LOAD-DATE: May 29 2001 of 98 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service Dallas Morning News 29 2001 Tuesday SECTION: DOMESTIC NEWS KR-ACC-NO: ?K7523 LENGTH: 1046 words HEADLINE: Bush begins visit in hostile California BYLINE: By G. Robert Hillman BODY: ??LOS ANGELES _ President Bush landed in hostile territory Monday night beginning his first presidential visit to California amid a pressing energy crisis that he says he cannot ease in the short term. ??We welcome him to California said California Gov. Gray Davis a Democrat who has waged a long-distance war with the Republican president over the high cost and short supply of electricity in the nation's most populous state. ??I hope he has an opportunity to talk firsthand to some of the people who are adversely impacted by the very high rates we're paying for electricity. ??But the president's carefully scrubbed schedule for the next two days provides little time for such an opportunity although he will confer privately with business leaders to discuss high-tech solutions to the state's energy problems. ??Arriving on a cross-country flight that touched down in Arizona for a Memorial Day tribute Bush headed off to prepare for an early-morning stop Tuesday to promote energy conservation at the Marine Corps' Camp Pendleton and a luncheon address to the Los Angeles World Affairs Council. ??On Wednesday he'll visit Sequoia National Park near Fresno Calif. to launch a new drive to clean up and fix up national parks. ??He'll also meet privately Tuesday afternoon with Davis in what the Los Angeles Times characterized as a peace summit. But no major shifts in policy are expected. White House aides suggest that the meeting will be a success if the governor even temporarily tempers his sometimes-harsh words for the administration. ??The president's focus is going to be on solving problems. He's not interested in finger-pointing White House press secretary Ari Fleischer said. ??Whether people agree or disagree with the specifics of his energy plan I think most Americans and most Californians are very pleased to see a president who is leading and taking action in addressing the issue head on. ??However recent public opinion polls show the president and the governor taking hits for the energy crisis in California. ??The Field Poll finished a week ago found that 54 percent of those surveyed believed Bush had handled the energy problems poorly with Davis faring somewhat better at 38 percent. The margin of error for the 1015 California interviews was 3.2 percentage points. ??An earlier survey by the Public Policy Institute of California found Davis' job approval rating plummeting from 63 percent in January to 46 percent in May as the state's energy troubles escalated. Bush's overall approval rating was higher at 57 percent but still just as many of those surveyed gave him low marks for his handling of energy issues. That margin of error for 2001 interviews was 2 percentage points. ??In short political analyst Sherry Bebitch Jeffe said Bush's visit to the state _ in his 19th week as president after already visiting more than half the other states _ is long overdue. ??His not responding or not being perceived to respond to the short-term needs of California has allowed Davis' arguments to resonate _ that the federal government is uncaring is insensitive Jeffe said. ??In his national energy policy unveiled nearly two weeks ago Bush offered a series of mostly long-term recommendations to conserve energy find more of it and substantially upgrade and expand the nation's oil refineries and transmission systems for natural gas and electricity. ??Davis complaining that Texas energy companies in particular are gouging Californians has urged Bush to embrace price controls for wholesale electricity but the president has steadfastly refused. Vice President Dick Cheney who oversaw development of the White House energy policy emphasized as recently as Friday that there's no quick fix on the way for California. ??Long term the answer is to build more power plants and that's exactly what they're doing Cheney told the U.S. Chamber of Commerce. But they're not going to have enough new capacity online this summer to avoid blackouts. ??So the energy woes continue to fester in California. It's not just electricity and rolling blackouts. Gasoline prices of $2-and-more-a-gallon have become commonplace as well. ??The gas bothers me more than the electric said Tait Kmentt who runs a legal process serving business in Irvine Calif. Gas prices are killing me. ??At $2.25-a-gallon for premium gasoline he says it costs him more than $40 to fill up his new Mercedes _ with no relief in sight. ??A newcomer to the state Kmentt voted for Bush last fall and said he's glad the president is finally visiting California. But Kmentt cautioned This will be a big test to see how concerned he is. ??Kmentt said he understands the state's energy troubles are a huge problem that can't be fixed overnight and right now he's blaming the power companies for the high price of electricity. ??I just think the public is being lied to he said. ??Still this is not good news for Bush who has been increasingly portrayed by Democrats as a Texas oilman still beholden to the industry. California which he lost last fall to Al Gore by 12 percentage points has become increasingly a political headache. ??Where his predecessor Bill Clinton seemed politically and personally comfortable Bush is not suggests Jeffe a senior scholar in the School of Policy Planning and Development at the University of Southern California. ??An ego cannot be buoyed by losing the state by 12 points she said. We are the state that was responsible for giving Al Gore his popular vote victory. ??With the Senate now headed for Democratic control Jeffe said Bush's visit to California _ and others that will surely follow _ are essential to help Republicans hold their base in the House. ??If the energy crisis persists in California further punishing its economy the ripple effects will certainly spread she said. ??George Bush remembers the influence of the economy on the career of an incumbent president Jeffe said pointing to Bush's father who was defeated by Clinton during an economic slump in 1992. ??It took a while she said but people are beginning to get angry. ??(c) 2001 The Dallas Morning News. ??Visit The Dallas Morning News on the World Wide Web at http://www.dallasnews.com/ JOURNAL-CODE: DA LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 / Los Angeles Times Angeles Times ??????????????????????May 29 2001 Tuesday ?Home Edition SECTION: California Part 2 Page 1 Metro Desk LENGTH: 1178 words HEADLINE: Governor to Stress Price Caps to Bush Power: In a meeting today with the president Davis will present a letter from economists backing cost controls and demand federal assistance. BYLINE: DAN MORAIN JAMES GERSTENZANG TIMES STAFF WRITERS BODY: ??Gov. Gray Davis will present a letter to President Bush today from top economists advocating wholesale electricity price controls warning Monday that a failure by Bush to help California solve its energy crisis could signal to other regions that he may ignore their pleas. ??Bush making his first trip to California has set aside 20 minutes this afternoon to meet with Davis in Century City. In an interview with The Times the Democratic governor vowed to repeat his request that the federal government move to cap wholesale power prices. Failure to act swiftly threatens the state and national economy Davis said. ??I want him to understand Davis said that if California has to pay 700 times more for electricity in 2001 than it did just two years ago it could well drag our economy into a recession and could conceivably trigger a national recession. That is not good for anyone. ??In the letter 10 economists including Cornell professor emeritus Alfred Kahn a major proponent of airline deregulation told of their deep concern about the failure of the Federal Energy Regulatory Commission to stabilize wholesale electricity prices in California. The economists faxed the letter to the White House on Friday afternoon and provided the governor with a copy to present to Bush today. ??FERC's failure to act now will have dire consequences for the state of California and will set back potentially fatally the diffusion of competitive electricity markets across the country the economists led by Frank Wolak of Stanford University wrote. Moreover this negative experience with electricity restructuring could delay or reverse current efforts to introduce competition into other formerly regulated industries. ??Davis called the letter very significant validation of what we've been saying: The marketplace is not working and FERC has an obligation to act. ??We're not pleading for relief we're entitled to it Davis said. ??Bush and Vice President Dick Cheney repeatedly have said such controls never work. In California caps might worsen the situation by limiting supply they have argued resulting in more blackouts this summer when demand for electricity is highest. ??The Bush-Davis meeting has had all the buildup of the political equivalent of a title fight: On one side the Democratic governor of the nation's most populous state which Bush lost by more than 1 million votes in November. On the other the new president coming off a roller coaster week of political defeat (the shift in control of the Senate) and victory (passage of his tax-cut plan) whose work in the Texas oil industry gives him a special history in the topic at hand. ??From afar Davis has battled the Bush administration's energy policy. But said Dan Bartlett one of the president's chief communications advisors The president has some interesting views on this topic as well with some experience himself. ??Bush's Energy secretary Spencer Abraham took steps Monday to increase electricity transmission capacity in California. He ordered the Western Area Power Administration a division of the Energy Department that is responsible for marketing electricity from federal water projects in 15 Western states to finish its planning for extra transmission capacity. ??At issue is so-called Path 15 an 84-mile stretch of power lines with insufficient capacity to carry the necessary load between Southern California and the northern part of the state especially during peak hours. The central question is whether financing is available for a new transmission line. ??Davis lauded the action but said the president needs to do more. ??If I have any advice to him of a political nature it is take a chapter out of President Clinton's book. ?? [Clinton] was very attentive to California and as a result did better in 1996 than he did in '92. People felt he was here for us when we needed help. We need help. ??Davis said that on a recent trip to Chicago officials there worried that if Bush won't offer California some relief he may not offer us relief in a catastrophe. ??Among the facts and figures Davis intends to show the president is a chart showing that California paid $1.2 billion for electricity in the first quarter of 1999 $1.8 billion for the same period last year and as much as $10.3 billion for electricity in the first three months of this year--at a time when conservation efforts had been taking hold and demand was down. ??I hope the president will be as stunned as I am said Davis who is watching as the state spends more than $55 million a day to buy electricity that private utilities can no longer afford. ??Davis said that though he is trying to speed construction of power plants encourage conservation and return the private utilities to financial stability the federal government has control over wholesale power prices. ??Therein lies the final piece of this puzzle Davis said. If it falls into place we're on the way to putting this issue behind us. If it doesn't fall into place it could create real economic havoc here and across the country. ??Davis said that if Bush refuses to impose price controls he should find some way to help us consistent with his own belief. ??Turning a deaf ear not only won't be well received here Davis said. It likely won't be received well elsewhere. ??The state's energy crisis has posed a ticklish dilemma for Bush's busy travel schedulers: Had he visited earlier it would have been awkward not to focus on energy issues. But until 11 days ago when a task force led by Cheney produced energy proposals there would have been little Bush could say. ??Karen Hughes the president's counselor made it clear that regardless of the pressure Bush will not yield on price caps. ??We want to help. The president is very concerned about the energy situation and blackouts she said. But limiting the wholesale price of energy would only discourage its production Hughes said. ??California is the 30th state Bush has visited since taking office Jan. 20. His staff said the delay had to do not with energy issues but with politics and geography. ??With the administration focused in its first months on winning approval of the tax cut the president's travels were largely dictated by that effort his aides said. ??Besides the president confided recently even with Air Force One at the ready it just takes too long to fly from Washington to California. ??Still Hughes said the president is not ignoring California. Condoleezza Rice the president's national security advisor and a former Californian sits next to Hughes every morning at the daily meeting of the White House senior staff she said. ??What's more the president has many friends in California Hughes said adding: Ernie has a home in California these days. Ernie is the Bush family cat that is living with a friend in Brentwood while the First Family lives in the White House. ??* ??Times Staff Writer Massie Ritsch contributed to this story. LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 / Los Angeles Times Angeles Times ??????????????????????May 29 2001 Tuesday ?Home Edition SECTION: Part A Part 1 Page 1 Metro Desk LENGTH: 1541 words HEADLINE: THE ENERGY CRISIS Kern County Basks in Role as State's Blackout-Buster Electricity: Six new plants will bolster its status as energy center. BYLINE: MITCHELL LANDSBERG TIMES STAFF WRITER DATELINE: McKITTRICK Calif. BODY: ??You could think of this as California's own little slice of west Texas. ??Here in the scruffy brown hills of western Kern County oil rigs grow more easily than trees pickups are more common than cars and chicken fried steak is the most popular dish at Mike and Annie's McKittrick Hotel. ??The hotel--which no longer offers lodging just food and drink and plenty of it--is bustling these days with the roustabout energy of a Lone Star construction camp. Just down the road a mammoth electrical power plant is rising out of the sagebrush its generators housed in four boxy buildings the size of airplane hangars. ??It is one of six new major gas-fired power plants expected to be built in Kern County over the next several years an electrical construction boom unmatched anywhere in California. Kern which already has a large surplus of electricity is cementing its place as California's energy capital assuming far more than its share of the burden in recharging the state's drained power supplies. ??Over the next several years the county will add nearly 5000 megawatts of power to the statewide grid. That is more than California now imports on average from out-of-state suppliers. It's enough to supply about five counties the size of Kern which fills the dusty southern rim of the San Joaquin Valley and has a population of 662000. ??In some parts of the state a proposal to build a new power plant is a call to throw up the barricades. In recent months intense community opposition has forced developers to pull back proposals to build major plants in South Gate and San Jose although Gov. Gray Davis has tried to revive plans for the San Jose plant. ??You don't hear a lot of not-in-my-backyard talk in Kern County. ??There should be power plants in everybody's backyard said Paul Gipe chairman of the Kern chapter of the Sierra Club which did not oppose any of the new plants. If people are concerned about having too many power plants they should think twice when they flip on the light switch. ??New natural gas-fired power plants Gipe reasoned are relatively clean and will not add significantly to the county's serious air pollution problems. Ideally he said they will allow the state to close some older dirtier plants that cause considerably more environmental damage. ??If environmentalists don't oppose the plants it's not too much of a leap to guess that some people might be positively thrilled about them. ??Just try for instance asking somebody in Taft an oil center south of McKittrick. It's more money coming into Kern County--that's the way I look at it said Pamela Dunlap who runs a downtown thrift shop. ??An Economy Rooted in the Oil Industry ??She stood in the twilight outside her shop on a street that embodies many of the most attractive attributes of small town Americana--with one small difference. Where some towns might have statues of their founders or war heroes in prominent public places Taft has erected small oil rigs and other pieces of drilling machinery a reminder of its economic roots. ??That Kern County has stepped up as California's blackout-buster is perhaps not surprising. ??To begin with there's geography. Kern stands astride California's major north-south electrical transmission lines at precisely the spot at which they divide between the service areas of Pacific Gas & Electric which serves Northern California and Southern California Edison. That spot can be pinpointed as the Midway substation a vast jungle of humming wires transformers and circuit breakers that lies a short distance west of Interstate 5 in the town of Buttonwillow. ??Already massive new circuit-breakers--they look like Frankenstein helmets sprouting 5-foot-long sparkplugs--are being erected at Midway to handle the power from two major plants that will be revving up in the coming months: PG&E National Energy's La Paloma plant the one near McKittrick and Edison Mission Energy's Sunrise plant just south of Taft. ??The county is served by two major natural gas pipelines which will be tapped to run the plants. In fact Kern contains the state's largest known reservoirs of natural gas. ??Another of Kern's geographic advantages? ??You look around and you'll see there aren't a lot of people living around here observed Stephen Whaley who is overseeing construction of the Sunrise plant. In the surrounding hills an orchard of oil rigs bobbed in the morning haze. Dirt roads cut crudely across the landscape bisecting a crisscross of steam pipes fuel lines and electrical wires. ??This area is all about oil Whaley said. Casting a glance at the modular 560-megawatt plant rising behind him he added with a wry smile You know I guess you could look at this from the road and you could make the argument that it improves the looks. ??The Sunrise plant a relatively simple single-cycle plant is expected to fire up 320 megawatts of its total output by Aug. 1 a scant nine months after construction began. The other plants--more complex and efficient dual-cycle operations--will be opening over the next several years assuming all receive final approval. ??The lack of major opposition to the plants is of course another reason developers see Kern County as a good place to build. The county has long had a more intimate relationship with energy--oil gas electricity--than most places. To people here the link between a natural gas well and a lightbulb or an oil derrick and a gas pedal is neither theoretical nor especially threatening. They're comfortable with energy. ??Kern produces more crude oil than any other county in the United States outside Alaska. Property taxes from oil companies have helped build handsome new schools in Bakersfield the county seat and largest city. The companies' big payrolls have helped populate elegant subdivisions with names that sound vaguely Houstonian: Seven Oaks River Oaks Landmark Estates. ??Which brings us to the Texas connection. ??It's hard to overlook it in a county that runs on oil and cotton and boasts a country music scene to rival Austin's. Conversations in the finer Bakersfield restaurants are filled with references to trips to Texas of colleagues in Midland and Odessa. A Bakersfield radio station was running a contest recently: The winners would be flown to a bull riding championship in Houston. ??Until December 1999 American Airlines offered direct jet service between Bakersfield and Dallas. It stopped after Occidental Petroleum moved its headquarters from Bakersfield to Houston. ??This is a county where President Bush received more support in the November election than he did in Texas his home state. But then Bush already had a Bakersfield connection: He lived there briefly as a child when his father former President George Bush worked in the Kern oil fields. ??You look at the topography around Bakersfield and the county's morals and ethics--that predominantly conservative attitude that we have around here--and you look at the oil and you could be in Midland said John Allen the general manager of Occidental of Elk Hills which is developing a power plant in tandem with Sempra Energy of San Diego. ??A lot of people in Kern County will tell you they don't mind being an energy farm for the state. It's a living after all. ??It's good to be working at home said Joe Ryan a Bakersfield pipe welder who has spent years on the road seeking the heavy construction work that seemed to have vanished in his hometown. Now he's working at the La Paloma plant a 1048-megawatt behemoth that will come online in phases beginning in December. ??About 800 people are at work on the plant and several hundred more will be employed in the coming months. And after that plant is done there will be others to build. ??This is a good job here I tell you what said Ryan 47 who has been banking his overtime on six 10-hour days a week--sometimes more. ??County Sees Itself as 'Part of the Solution' ??But there are some signs of simmering resentment especially among county leadership. After all if every other county produced just half the electricity that Kern generates California wouldn't have an energy crisis. And people in Kern County are getting hit with the same spring-loaded electricity bills the same rolling blackouts as everybody else. ??I think the people of California are either going to be part of the solution or part of the problem said Assemblyman Roy Ashburn (R-Bakersfield). And in Kern County we have a long history of being part of the solution especially when it comes to energy issues. ??Elsewhere in the state Ashburn sees a lot of arrogance--people who enjoy the benefits of a very high quality of life enjoy the benefits of electric power for jobs and for their personal life but with an exclusivity that it's someone else's problem to create that for them. We don't have that attitude in Kern County. ??Power Buildup in Kern County ??Six new major gas-fired power plants are expected to be built in Kern County over the next several years making the county the power capital of the state. ??* ??RELATED STORY ??Letter to Bush: Gov. Davis will ask for wholesale energy price caps. B1 GRAPHIC: PHOTO: Tom Romesberg general manager of La Paloma plant being built in Kern County stands next to the unit's cooling tower. PHOTOGRAPHER: AL SEIB / Los Angeles Times PHOTO: From rigs and pipelines like these near Taft Kern pumps more crude oil than any other county in the U.S. outside Alaska. With several gas-fired power plants coming online in the next several years the county will solidify its place as California's energy capital. PHOTOGRAPHER: AL SEIB / Los Angeles Times GRAPHIC: Power Buildup in Kern County Los Angeles Times LOAD-DATE: May 29 2001 of 98 DOCUMENTS ??????????????????Copyright 2001 The New York Times Company New York Times ?????????????????May 29 2001 Tuesday Late Edition - Final SECTION: Section A Page 12 Column 1 National Desk LENGTH: 1078 words HEADLINE: For Crucial California Trip Bush Calibrates How Best to Handle State's Energy Crisis BYLINE: ?By DAVID E. SANGER DATELINE: LOS ANGELES May 28 BODY: ??Days after he suffered the biggest political setback of his four-month-old presidency and then won the tax cut that he staked his campaign upon President Bush traveled tonight to California carefully calibrating how to deal with the state's energy crisis. ??After Memorial Day celebrations in Washington and Mesa Ariz. Mr. Bush began his first visit as president to the most populous state which he lost by roughly 12 percentage points in November's election. The visit seems likely to showcase the clash between two very different energy strategies and political strategies. ???Mr. Bush will meet briefly on Tuesday with Gov. Gray Davis who will insist as he did again today that the federal government impose price caps on wholesale electric power. ??The White House says Mr. Bush will refuse again. He will argue that such caps would only discourage increased production of electric power. We think that's a mistake Vice President Dick Cheney said on Friday talking about why he rejected those options when he prepared the energy policy the administration made public 10 days ago. ??But Mr. Bush knows that how he handles the California energy crisis could prove critical to his political fortunes especially now that his party's loss of control in the Senate seems bound to slow or derail passage of major elements of his energy plan. ??Moreover the president can no longer argue that the best cure for high energy prices is a tax cut because that is now legislative history. As one of his aides said this weekend after Congress approved the $1.35 trillion tax cut that will be phased in over the next 10 years we will have to turn now to the other arguments. ??Most of those arguments involve urging the rest of the country not to follow California in a partial deregulation of the market with disastrous results. ??Repeatedly Mr. Bush has chastised California's politicians and by implication Mr. Davis himself for ignoring politically unpalatable choices to avert the state's power-generating crisis. Ten days ago standing in front of a hydroelectric plant in Pennsylvania Mr. Bush used the state as Exhibit A for his argument about what happens when population rises when over-regulation freezes the construction of new power plants and the stringing of new transmission lines and when politicians fail to plan for the long term. ??The problems in California shows that you cannot conserve your way to energy independence Mr. Bush said then. ??At the same time his aides were pointing to polls showing Mr. Davis's approval ratings plunging. They did not mention that Mr. Bush's ratings in the state were hardly any better. A series of recent polls show that roughly two-thirds of Californians believe Mr. Bush should be doing far more to help the state though it is unclear exactly what kind of help they have in mind. ??So Mr. Bush's aides have been struggling for days to choreograph the two-day visit here trying to find ways to differ with Mr. Davis without seeming callous about the problem or in conflict with the state. ??The betting is that Mr. Bush will focus on long-term solutions in contrast to Mr. Davis's call for the quicker fix of price caps. ??The effort started today. Energy Secretary Spencer Abraham issued an order of chiefly symbolic importance saying his department would move quickly to determine whether investors were interested in financing and co-owning a new transmission line that could bring more power to the state. ??The level of interest will be a factor in the decision to build the line later this year the Energy Department said. It said that it would proceed with studies of how the land could be acquired by eminent domain if necessary and that it would speed ahead with environmental reviews. ??But Mr. Abraham left wide open the question of whether Washington would go ahead with the project even if no private financing was available. ??The Bush administration is taking a leadership role in addressing a long-neglected problem in California's electricity transmission system Mr. Abraham said. California's electricity problems developed over a period of years and cannot be solved overnight. However we can move now on actions that will help avert the same types of problems from recurring year after year. ??The statement was clearly intended as a prelude to the meeting with Mr. Davis which will be closed to the press. So will a meeting with energy entrepreneurs. (Mr. Bush passed on Mr. Davis's suggestion of a forum with small-business owners and residents who have seen the lights go out.) ??Few expect Mr. Bush or Mr. Davis to change his mind about energy caps after their meeting. ??But for Mr. Bush it will not all be tough love. On Tuesday morning Mr. Bush is scheduled to travel to Camp Pendleton to repeat his call for the military and other federal users of power in California to flip off their switches whenever possible. But given his own comments and Mr. Cheney's about the limited utility of conservation that order could strike some Californians as a little hollow. ??Later he will give a trade speech in Los Angeles underscoring the message that if California hopes to remain the world's greatest exporter of high technology -- if it were a nation California would be the world's sixth-largest economy -- it must find new ways to produce and deliver electricity. ??Already leading Silicon Valley companies are threatening to build their next-generation chip fabrication plants elsewhere probably in Texas which has a surplus of generating capacity a move that would further undermine Mr. Davis's stewardship. ??In fact Mr. Bush's Texas roots will never be far from the political battlefield here. Mr. Davis has accused Texas energy companies of profiteering at California's expense. To press the case he has hired two political operatives from the Clinton White House Marc D. Fabiani and Chris Lehane who are being paid tens of thousands of dollars a month to make the case for price caps. ??California's attorney general Bill Lockyer also a Democrat suggested to The Wall Street Journal last week that some time in jail would be the best way to deal with one of Mr. Bush's biggest supporters -- Kenneth Lay who heads the Enron Corporation and has sought to influence the selection of members of the Federal Energy Regulatory Commission. ??The comments may have been partly facetious but they were not interpreted that way here. ??http://www.nytimes.com LOAD-DATE: May 29 2001 of 98 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ??????????????????????????The Orange County Register 29 2001 Tuesday SECTION: DOMESTIC NEWS KR-ACC-NO: ?K7500 LENGTH: 825 words HEADLINE: California's power crisis generating lots of heat BYLINE: By John Howard BODY: ??SACRAMENTO Calif. _ Detectives would seem to be tripping over each other to discover who did what to whom and why in California's energy crisis. ??While electricity may be scarce investigations are plentiful. A dozen major probes are afoot many overlap and more loom. The atmosphere is heated the rhetoric strong. State federal and local investigators along with court officers financial experts and special investigators are poring over thousands of pages of documents from government agencies and private companies. ??At the top of the swarming heap is the $10 million investigation mounted by the state Attorney General's Office to answer the core question: Did a handful of power sellers fix prices to bilk Californians of billions of dollars? ??But it's not just the government that is busy. The companies themselves _ which have categorically denied any wrongdoing _ are overwhelmed by the scrutiny. ??We are supplying reams and reams of documents. ... It is a distraction from our day-to-day work there's no question said Tom Williams of North Carolina-based Duke Energy which operates several power plants in California. It affects our employees and their families this barrage of innuendo. I don't know what more we can do. ??Accompanying the investigations are at least a half-dozen lawsuits against the companies by individuals. Like the probes the suits contend the companies improperly manipulated the market. Legislative leaders meanwhile have sued the federal government contending it has failed to protect consumers from price-gouging. ??This all permeates our business in so many ways said Gary Ackerman of the Western States Power Forum a group that represents power sellers and buyers in the West. It even affects my ability to talk to the newspapers because we're afraid statements may turn up later and be used as evidence. We're not sure what we're dealing with whether a suit or even a grand jury if the (attorney general) decides to take criminal action as he said he might. ??The state's top prosecutor said that indeed criminal charges are a possibility. ??There is an investigation under way that involves potential criminal conduct said Sandra Michioku a spokeswoman for Attorney General Bill Lockyer. It could be at least eight weeks before that probe is completed she said. ??Other investigating agencies include the Federal Energy Regulatory Commission the California Public Utilities Commission the city attorneys' offices in Long Beach Los Angeles and San Francisco California's grid manager the Independent System Operator the obscure Electricity Oversight Board which oversees the ISO and the state Senate and Assembly. ??The state has even considered asking two more federal agencies the Department of Energy and the Federal Trade Commission to get into the act. Some offices are conducting multiple investigations. In the case of at least two agencies the PUC and the Attorney General's Office the investigations are being at least partly coordinated. Some agencies are examining the same issues. The PUC the attorney general and ISO for example all are looking at whether power plants were shut down to drive up demand and prices. ??There is a lot of overlap and there probably are problems of coordination said Nettie Hoge of The Utility Reform Network of San Francisco a grass-roots watchdog group. ??With so many agencies trying to extract information Hoge said even those who have done no wrong are concerned about talking freely because of the greater likelihood that proprietary information will leak to competitors. ??Others feel the overlap is beneficial. ??When you're up against an industry as wealthy and powerful as the energy industry it's probably better to double-team them said Doug Heller of the Foundation for Taxpayer and Consumer Rights. ??Hoge believes that if any investigation is going to produce results it will be Lockyer's because the governor has thrown all the resources that way. ??Investigators have requested mountains of paperwork. Transaction and maintenance documents market reports financial records even e-mails _ all have been sought. ??Martin Wilson a spokesman for Texas-based Reliant contends the intensity of the probes could have negative long-term effect on California's business climate. ??There is a climate of instability and uncertainty that makes companies rethink their decisions about investments (in California) he said. ??But for consumer groups the goal of all these investigations is straightforward. ??Certainly we're really hopeful that these investigations will lead to refunds for customers said TURN's Mindy Spatz. There is a widespread belief among people who follow these issues that widespread gaming and manipulation has occurred in the market. ??(c) 2001 The Orange County Register (Santa Ana Calif.). ??Visit the Register on the World Wide Web at http://www.ocregister.com/ JOURNAL-CODE: OC LOAD-DATE: May 29 2001 of 98 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ?????????????????????MAY 29 2001 TUESDAY FINAL EDITION SECTION: NEWS Pg. A1 LENGTH: 1291 words HEADLINE: Crisis no sweat to some offices Many offices keep cool in crisis Air conditioners blast in state's energy centers SOURCE: Chronicle Staff Writer BYLINE: Steve Rubenstein BODY: Some very cool places to be during the dog days of spring and summer turn out to be the places with their fingers on California's air conditioning switch. ???If only the entire state could cram itself into the cavernous control room in Folsom of the Independent Systems Operator where the air is a comfortable 69 degrees and receptionists wear sweaters at high noon -- when it's upwards of 90 degrees outside. ???Or the Pacific Gas and Electric Co. lobby in downtown San Francisco where the air is an even chillier 65 degrees which admittedly isn't much of a bounty considering it's usually that cool outside anyway. ???Other cool places to be are the state Capitol where legislators who promulgate energy edicts hang out and the headquarters of the state Public Utilities Commission where bureaucrats who promulgate energy edicts hang out. ???Armed with a high-tech digital thermometer The Chronicle made the rounds of the energy crisis poohbahs to make sure they are practicing what they are preaching. ???Some were some weren't. Those that weren't blamed it all on that most familiar of modern scapegoats the computer. ???Computers must be kept cool -- in the 60s for big mainframes and a bit more for the smaller units most folks use though some can go into the 80s without hiccuping. So generally people who work alongside the computers get to keep cool by association although it's the computer that counts. ???The ISO headquarters located in an industrial park 20 miles east of Sacramento is a delightfully cool and comfortable place when the outside temperature soars into the 90s and 100s. ???The reception area the only room accessible to the outraged public is a fairly stiff 76 degrees -- only two degrees cooler than the 78 degrees recommended by President Bush and the federal energy crisis czars and czarinas. ???But take a step past the lobby security doors and the temperature plummets. In the main hallway the temperature is 73 degrees. And in the control room where two dozen engineers and technicians sit at consoles and monitor the flow of California electricity on a giant diagram of state power lines so they can order blackouts for everyone else -- the temperature is 69 degrees. ???NO SWEATING AT ISO ???Some managers do not take off their sports coats and jackets. ???We want these people to be comfortable explained Tony Capasso facilities manager for the ISO complex. We don't want these people sweating bullets in the middle of a crisis. ???Inside the state Capitol where legislators and the governor preach compliance with federal guidelines calling for 78-degree thermostats the temperature dips into the high 60s. The coolest spots are the press briefing room and the treasurer's old office. ???GOVERNOR'S OFFICE ???The governor's suite is in the mid-70s apparently because folks are often coming by with thermometers and it wouldn't do not to set an example. Press secretary Steve Maviglio said Governor Gray Davis is a practice-what-he-preaches kind of guy who keeps corridors dark shades drawn air conditioners idle. His personal secretary works in short sleeves with a cheap plastic fan humming nearby. ???It's so dark in the hall that we're always bumping into things said one aide. ???Even so the temperature in the governor's suite of offices is three degrees cooler than the 78 degrees recommended by President Bush -- not the first time the two men have failed to agree. ???THE LEGISLATURE ???The Assembly chamber is 71 degrees while the Senate chamber -- with 40 fewer legislators spewing forth -- is 73 degrees. But the Senate chamber has a southern exposure one Capitol guide explained. ???Hot air from the people sitting inside has nothing to do with it he said. ???In San Francisco the temperature inside cavernous City Hall dips in spots to the mid-60s. College student Jasmine Westbrook who dropped by with her art class on a project to sketch the interior of the building was doing her sketching while wearing a windbreaker to keep warm. ???I want to stay comfortable she said. It think it's supposed to be hotter in here isn't it? ???The mayor's office at 73 degrees was eight degrees warmer than another office down the hall even without the mayor sitting in it. ???63 AT THE PUC ???At the headquarters of the state Public Utilities Commission which is supposed to be keeping an eye on the self-declared bankruptcy of the utility that mails out the bills the lobby temperature is 63 degrees. ???Chief engineer David Omosheyin eyeing The Chronicle's thermometer nervously insisted the 63-degree reading was caused by the lobby's proximity to the front door where the outside temperature at the moment was in the low 60s. He invited the thermometer to visit the upper floors where the temperature was 70. ???As for San Francisco's federal buildings: Bush would probably not frown. ???His orders appeared to be followed during The Chronicle's visits so much so that it was actually hotter inside than out. Though that wouldn't be hard considering it was in the low 60s outside. And the places measured happened to be courtrooms and tax offices where the body heat from anxiety alone could probably melt the paint some days. ???San Franciscans Omosheyin said are losing their perspective when it comes to things like electricity energy alerts and rolling blackouts. In his native country of Nigeria he said the electricity runs sporadically if at all. ???There the power can go off for a week he said. The world goes on. Here people take a lot of things for granted and electricity is one of them. ???As for the offices of the places that report on such matters they fared about the same. ???The Walnut Creek bureau of The Chronicle where the sun sizzles into the 90s with regularity in the summer is kept at 67 degrees because of all the computers. The main newsroom of The Chronicle is kept at 71 degrees because of all the computers. But the reception room was 71 degrees too and there aren't any computers there not a one. ???Some offices keeping their cool Place ????Outside ?temperature Control Room California Independent Systems Operator (Folsom) ?????????????????69 ??????90 Governor's office Capitol (Sacramento) ???75 ??????94 Press briefing room Capitol (Sacramento) ?68 ??????94 Caltrans headquarters (Sacramento) ????????70 ??????94 Chronicle bureau newsroom (Walnut Creek) ??67 ??????90 Mayor's Office San Francisco City Hall ???73 ??????63 Calif. Public Utilities Commission lobby (San Francisco) ???????????????????????????63 ??????63 State Building (San Francisco) ????????????69 ??????63 Courtroom 19th floor Federal Building (San Francisco) ???????????????????????????70 ??????63 Lobby Pacific Gas and Electric headquarters (San Francisco) ??????????????65 ??????65 IRS office Federal Building (San Francisco) ???????????????????????????69 ??????63 Main newsroom San Francisco Chronicle (San Francisco) ???71 ??????64 ???E-mail Steve Rubenstein at srubenstein@sfchronicle.com. GRAPHIC: PHOTO (2):CHART: SEE END OF TEXT (1) It's too warm for jackets in the chief clerk's office in the state Capitol building in Sacramento. (2) Jane Malison of Millbrae needed a fan while touring a warm section of the state Capitol but other parts of the building are kept below 70 degrees. / Photos by Kat Wade/The Chronicle LOAD-DATE: May 29 2001 of 98 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ?????????????????????MAY 29 2001 TUESDAY FINAL EDITION SECTION: NEWS Pg. A1 LENGTH: 1238 words HEADLINE: Bush facing Davis' heat over energy In first visit to state as president he'll hear governor's plea for help SOURCE: Chronicle Political Writers BYLINE: Carla Marinucci Lynda Gledhill BODY: President Bush wasn't on California soil for more than five minutes yesterday when he was drawn into his first debate on the state's power crunch. ???Rep. Brad Sherman a Democrat from Thousand Oaks who met Air Force One on the tarmac at Los Angeles International Airport along with a group of high school students wasted no time button-holing the president for what appeared to be an animated conversation. ???I brought up . . . the idea that after his meeting with our governor I hoped he would be in favor of wholesale regulation (of energy prices) Sherman said later. He disagreed with me. ???Sherman -- who two weeks ago suggested that the headline to the president's national energy policy should be Bush to California: Drop Dead -- didn't seem optimistic yesterday about Bush's 48-hour visit to the state. I think that the president's policies show either a lack of understanding of what's really going on in California or a lack of concern he said. ???That vignette underscored some of the challenges facing Bush who arrived in California as protesters geared up and Democratic Gov. Gray Davis prepared to press him for federal action on the state's power troubles. ???Besides Sherman Bush was greeted by a crowd of cheering Republicans including Secretary of State Bill Jones and Los Angeles Mayor Richard Riordan the former a declared GOP candidate for governor in 2002 the latter a rumored one. ???But today Bush will sit down with the present governor who lately has been blistering in his criticism of the president. ???The last time I looked California was still part of the United States of America Davis told reporters this weekend. We have contributed disproportionately to the economic growth of this country. There's no reason why a president should not respond to a legitimate request from the chief executive of the largest state in the union. ???In his first visit to California since just before the election Bush plans to emphasize the energy crisis -- but will focus on it through the lens of his own energy plan. ???ENERGY SECRETARY ACTS ???Just hours before the president landed Energy Secretary Spencer Abraham ordered a speedup in planning to relieve a notoriously overloaded electricity transmission line in California. ???Abraham's holiday action was timed to provide a bit of positive news for Bush to announce in California. He ordered the Western Area Power Administration a 15-state marketing arm of the Energy Department to complete planning and seek outside financing to reduce the transmission bottleneck on California's Path 15 which connects the northern and southern parts of the state. ???This morning Bush will visit the Marine Corps base at Camp Pendleton near San Diego to underscore his conservation order for a 10 percent cut in energy usage in federal buildings and military facilities. ???In Los Angeles he will deliver a wide-ranging talk before the World Affairs Council and lead a discussion among business leaders about technological advances in energy conservation. ???Then he will head to Fresno and Sequoia National Park to press his initiative to improve national parks. Along the way protesters have vowed to provide a vocal commentary on Bush's energy and environmental policies. ???But the real drama of the trip will no doubt be the sit-down between Bush and Davis today. The governor pushed for a lengthy open meeting with Bush that would include testimony from officials and consumers affected by the energy crisis. Bush's camp announced Friday the meeting would be 20 to 30 minutes -- in private. ???Davis plans to outline steps the state has taken to alleviate the energy crisis and what it wants the federal government to do -- including implementing price caps on the wholesale cost of energy cost-based pricing and the possibility of ordering refunds. ???DAVIS THREATENING SUIT ???The governor has said he will consider suing the Federal Energy Regulatory Commission -- the agency charged with overseeing energy prices -- if it does not impose temporary price caps. ???And the state Legislature has already filed a suit saying the commission has failed to stop what it has determined are unjust and unreasonable prices. ???With California's energy woes worsening and a summer of rolling blackouts predicted the Bush-Davis session holds potentially deep political pitfalls for both leaders both of whom are suffering in state polls as a result of their handling of the energy crisis. ???Bush needs to demonstrate his concern for California a state that gave a 12-point margin of victory to Al Gore in the presidential election. ???But even as Bush adviser Karen Hughes told state reporters this week that the president had arrived to show he cares Vice President Dick Cheney again chastised state officials for delaying their response to the energy crisis because all of the action was potentially unpleasant. ???And Cheney signaled that the administration would resist long-term price caps saying We think that's a mistake. ???Such talk drew fire from Davis' senior political adviser Garry South who charged that Cheney's words demonstrated insensitivity to California's troubles and only underscored the perception of an all-oil all-the-time ticket. ???Davis whose campaign for re-election next year will depend on his handling of the crisis has stepped up his criticism of Bush and profit-hungry energy firms particularly those from Texas in recent weeks. ???And yesterday signaling no letup Davis' supporters made an unusual holiday conference call to again press his case for federal action. They argued that without immediate intervention from the Bush administration the economy of California -- and potentially the entire nation -- was at risk. ???'THIS ENORMOUS SHOCK' ???We have this enormous shock in prices that needs to be addressed and not ignored said Joseph Fichero head of Sabre Partners and a consultant to Davis. ???Alan Blinder a Princeton economist and former vice chairman of the Federal Reserve warned that energy woes in California alone would take almost a half a percent of the gross domestic product off of the national economy. ???Blinder and others argue that short-term relief -- for about 6 to 12 months -- is necessary while new power plants are being built. ???Most times and most places I agree price caps are not the long-run solution but they can be part of a short-term solution Blinder said. There really is a case for temporary price caps to shield consumers and the California and national economy from the full force of the energy shock. ???Limited new price caps approved by the Federal Energy Regulatory Commission on the sale of wholesale electricity begin today in California. But the temporary caps which go into effect when the electricity reserves dip below 7.5 percent have been lambasted by Davis as ineffective and inadequate. ???Political analysts say Bush's resistence on the issue could cost him in California -- and elsewhere. ???(California) is probably an area where he is criticized more than any other region in the country said Mark DiCamillo director of the statewide Field Poll. Californians are looking to Bush for some relief -- and to the extent they don't get it Bush may be in some jeopardy here.Chronicle news services contributed to this report. / E-mail the writers at cmarinucci@sfchronicle.com and lgledhill@sfchronicle.com. GRAPHIC: PHOTO (2) (1) Rep. Brad Sherman (left) D-Thousand Oaks buttonholed President Bush as he arrived at Los Angeles International Airport to discuss the state's energy crisis. (2) President Bush signed autographs for students from El Camino High School at Los Angeles airport. Bush is to meet with Gov. Davis today. / Photos by Carlos Avila Gonzalez/The Chronicle LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 Gannett Company Inc. TODAY ?????????????????????May 29 2001 Tuesday FIRST EDITION SECTION: NEWS Pg. 3A LENGTH: 426 words HEADLINE: Davis to urge Bush to back electricity price cap BYLINE: Laurence McQuillan DATELINE: LOS ANGELES BODY: LOS ANGELES -- California Gov. Gray Davis will urge President Bush today to back a 2-year cap on electricity costs as the best way to keep his power-starved state -- and possibly the U.S. economy -- from sinking into recession. ???The Democratic governor and Republican president who have been sparring from afar over energy policy will meet here to discuss their differences. The White House has said repeatedly that it opposes price caps as a way to deal with energy shortages in California. ??In an interview with USA TODAY Davis said a limit on wholesale electricity costs is needed while the state attempts to build 15 new power plants. He said that would still allow a 30% profit margin. ??While the president didn't create this problem he is uniquely situated to solve it Davis said. I'll make clear that he has an opportunity to relieve the pain and give California the breathing space to put more plants online. ???Bush making his first visit to California as president unveiled a long-term energy policy this month that calls for increased production and to a lesser extent conservation. The president will promote conservation steps being taken by the federal government during a visit today to the Marine Corps base at Camp Pendleton. ??The president believes that imposing price caps will only make the problem worse White House spokesman Dan Bartlett said. ??Davis whose popularity has plummeted as Californians cope with blackouts to offset electricity shortages said his state's problems could hurt all Americans if they are not dealt with quickly. I'm asking for some form of relief that reduces the outrageous prices we're currently bearing he said. Without that relief lots of people will lose their businesses and California could well be dragged into a recession. Since we're about one-eighth of the national economy that doesn't bode well for America. ???The California Public Utilities Commission has announced rate increases of up to 50% for businesses and 37% for homes. ??Bush has sidestepped California after losing the state by 12 percentage points to Democrat Al Gore last year in the presidential election. But with Democrats targeting several GOP House members in next year's elections Republicans must go on the offensive or risk losing control of the closely divided House of Representatives. ??Davis a possible presidential candidate in 2004 said he wants to avoid rancor with Bush: I'm saying 'Look we got into this in a bipartisan way. We should get out of it in a bipartisan way.' LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 The Washington Post Washington Post ?????????????????????May 29 2001 Tuesday Final Edition SECTION: A SECTION Pg. A02 LENGTH: 639 words HEADLINE: Energy Chief Moves To Aid California Transmission Plan Precedes Bush Visit BYLINE: Mike Allen Washington Post Staff Writer DATELINE: LOS ANGELES May 28 BODY: ???President Bush landed at ground zero of the nation's energy worries tonight hours after Energy Secretary Spencer Abraham speeded up planning to relieve a notoriously overloaded electricity transmission line through California. ???Abraham's holiday action was timed to provide a bit of news for Bush to announce during his first presidential trip to California where he is to hold a politically charged private meeting with Gov. Gray Davis (D) on Tuesday. Bush's aides said he will pledge to cooperate with California but will stick to his position that no action by the federal government can prevent the rolling blackouts expected this summer. ???Abraham ordered the Western Area Power Administration a 15-state marketing arm of his department to complete planning and seek outside financing for an increase in transmission capacity that he said would be a big step in the right direction and a big step forward for Californians. ???California's electricity problems developed over a period of years and cannot be solved overnight Abraham said in a news release. However we can move now on actions that will help avert the same types of problems from recurring year after year. Today's action is designed to reduce the bottleneck on California's Path 15 which connects the northern and southern parts of the state. ???Davis who is seeking reelection next year has seen his poll ratings plummet as electricity prices soared utilities hit dire financial straits and homes and businesses were surprised with blackouts. ???Bush has taken several steps to try to encourage additional power generation in the state but has maintained since before he took office that California's problems were created here -- through a troubled effort at electricity deregulation and public opposition to construction of additional power plants -- and would have to be solved here. ???Davis plans to use the meeting to lobby Bush once again to endorse a cap by the Federal Energy Regulatory Commission on the wholesale price of electricity. Again and again the administration has said it will not take that step. ???This administration does not and will not support energy price controls Bush told a business audience in March. Price controls do not increase supply and they do not encourage conservation. Price controls contributed to the gas lines of the 1970s. And the United States will not repeat the mistake again. ???Davis energy advisers told reporters on a conference call today that without the cap California energy costs could be $ 50 billion higher this year than two years ago. Alan S. Blinder the Princeton University economist and former Federal Reserve Bank vice chairman said on the call that California's energy crisis should be enough to get the attention of policymakers in Washington. ???The visit by Bush who flew here after making a Memorial Day speech at a fighter aircraft museum in Mesa Ariz. is being carefully managed to avoid contact with the general public. After speaking to military families at Camp Pendleton on Tuesday morning he plans to address a luncheon meeting of the Los Angeles World Affairs Council which has sold out of tickets at $ 75 for members or $ 85 for guests. ???Afterward Bush will hold a closed-door session with business people and then meet with Davis for 20 minutes. As Bush departs Davis plans to make an immediate statement for cameras. ???Although Bush says he has taken more than a dozen steps to help California Davis says price caps are essential and has said he may sue the federal government in an effort to get them if Bush does not go along. ???He has been helpful on a number of small matters and I appreciate his assistance Davis said during a telephone interview on Friday. But the big enchilada is the price of electricity. LOAD-DATE: May 29 2001 of 98 DOCUMENTS 2001 The Washington Post Washington Post ?????????????????????May 29 2001 Tuesday Final Edition SECTION: A SECTION Pg. A03 LENGTH: 1936 words HEADLINE: It's Still Dawn for Solar Power in L.A. Despite City Subsidies Homeowners Hesitate to Install Expensive Alternative Energy Source BYLINE: William Booth Washington Post Staff Writer DATELINE: LOS ANGELES BODY: ???One year ago this city announced its intent to become the Solar Capital of the World with 100000 roofs covered with solar electric panels by the end of the decade an audacious goal to transform the homes of this smoggy but sunny metropolis into miniature power plants. ???To fulfill what is perhaps the nation's most ambitious solar campaign the Los Angeles Department of Water and Power began offering substantial buy down subsidies that would reimburse rate payers for half the price of each new solar energy system. For the average home a photovoltaic package costs between $ 10000 and $ 20000 parts and labor included before the rebate. ???How many have been installed? ???At last count about 40. ???That leaves only 99960 rooftops to go. ???The Bush administration and especially Vice President Cheney architect of its energy plan have been criticized for skepticism regarding alternative energy sources. But a close examination of the Los Angeles solar experiment and a review of similar programs suggest the former oilmen in the White House have a point: Solar at least has not proven ready for prime time. ???For all of Los Angeles's good intentions and for all of solar's many positive attributes the problems of harnessing its power remain. Some of those challenges are economic and some technological others are more mundane but often ignored such as finding a qualified contractor a homeowner can trust to drill dozens of holes in the roofs to mount the things. ???In a reprise of the 1980s solar again is hot. The price of photovoltaics is dropping and interest is growing. Other states such as New York Arizona Florida and Washington are moving to join California in major efforts to wire homes to draw power from the sun. ???But as many Americans are beginning to understand the delivery of energy is like a complex interconnected assembly line and the devil lurks in the details. ???The Los Angeles experiment tells the story shared by other locales. In L.A. for example the city's lone solar panel manufacturer has not been able to supply enough systems to meet demand. ???The systems too are often oversold by solar proponents. In the real world most do not pay for themselves in a few years as some advocates claim but take 20 years or more to return their initial cost in the form of reduced utility bills. ???Nor are the systems maintenance-free: At a minimum the rooftop panels must be routinely cleaned of pollution dust and leaves. ???They cannot be installed efficiently on homes without shade-free south-facing roofs the shadow from a neighbor's palm tree can frustrate the system's photovoltaic cells. ???Nor will the most common systems allow buyers to live off the grid unless they want to purchase a large bank of batteries. Even with the batteries homeowners probably would not be able to run their washing machines and air conditioners at the same time. ???It is not an economic proposition at this point conceded Terry Peterson a solar expert at Electric Power Research Institute in Palo Alto Calif. But one day Peterson predicts 100 years from now solar energy will provide a substantial percentage of the world's energy needs. In a decade or two the cost of solar will likely be competitive with other energy sources such as natural gas nuclear or coal. ???But now? It is still a luxury item. Like buying a swimming pool Peterson said. ???I really like the idea of running my house with solar power said Andrew Chin a potential customer in Los Angeles who has been researching a purchase. But they're still pretty expensive even with the rebates and so I gotta ask myself what am I doing this for his conscience or his wallet. I'm thinking I might wait until they work the kinks out. ???The most knowledgeable and experienced solar contractor in Los Angeles is probably Graham Owen the founder owner and single full-time employee of Go Solar Co. ???His installation of a one-kilowatt solar electric system on a home in the San Fernando Valley was the first to be awarded a rebate by the Los Angeles power department in March. ???How many systems has he installed as part of the rebate program? Three. ???But Owen is a true believer and over the next year he plans to cover hundreds of roofs with solar panels. On his shelf Owen still has an unreturned library book The Coming Age of Solar Energy published in 1963 and checked out from his high school in Lennox Hills Ill. in 1979. I guess we're still stuck in the coming age of solar energy he said smiling. He recalled that the buzz about solar water heaters in the 1980s led to disappointment with shoddy workmanship and less than spectacular energy savings. ???Until recently there has been little widespread interest in solar electric power. Since 1998 the California Energy Commission has been pushing its own program to encourage homeowners to erect photovoltaic panels on their roofs offering to subsidize about one-third of the cost. ???Across a state with a population of about 35 million only 450 solar energy systems have been installed on homes. ???Then the California energy crisis struck with its power interruptions and steep rate increases and the phone calls began to overwhelm Owen's voice mail. ???On days with rolling blackouts? I get a hundred calls maybe more Owen says. His Web site www.solarexpert.com is now receiving 3000 hits a day. Customers are begging him to do jobs. ???The Los Angeles power department reports a similar surge in interest since the energy crisis began six months ago. Customer demand has shot through the roof says Angelina Galiteva executive director for strategic planning at the Department of Water and Power. She estimates that her department receives 1000 calls on some days about its solar subsidy program. ???Yet while the reliability and cost of solar electric technologies continue to improve solar power today accounts for only a sliver of the national pie chart of energy production -- less than 1 percent. The country produces about 300 megawatts of electricity with solar -- about the same amount produced by a single mid-sized traditional power plant. ???The current trend for photovoltaics is not to erect large centralized solar farms in the desert an experiment that withered in the 1980s but to pursue distributed generation or individual units on scattered rooftops. ???The problem has consistently been the cost of the solar panels which has been too steep to justify them except for customers who are committed environmentalists or techies who like the elegance of the systems. ???Los Angeles began its solar experiment after Sacramento legislators mandated that utilities spend about 3 percent of their revenue on efficiency conservation and renewable energy. For solar the power department committed $ 75 million over the next five years -- enough to subsidize panels on 7500 homes. ???The power department will pay $ 5 for each watt of solar installed on a residence or business. Homeowners typically purchase a one-kilowatt or two- kilowatt (1000 or 2000 watts respectively) solar electric system meaning that the municipal utility would pay between $ 5000 and $ 10000 of the cost up front -- an enticing tax-free offer. ???For many years I wanted to do solar but it was so expensive said LaWanda Geary in the San Fernando Valley who in April had Owen install 32 panels for a two-kilowatt system on her sunny roof. The rebate really got me going. I don't know many times when the government offers to pay half of anything. ???The systems that are eligible for rebates must be tied into a utility's electric power grid meaning that during the day when the sun is shining the panels are adding a stream of electrons used by the home to run its lights and appliances. ???If there is a surplus of solar power that electricity goes back into the power lines and is passed along to a neighbor and the electric meter at the house actually runs backward. Homeowners however are not selling their excess electricity -- they're giving it away to the utility company. ???On cloudy days and at night the home is not being powered by solar energy but getting its electricity the traditional way from the power lines. ???Calculations on savings vary. A two-kilowatt solar system can supply an average-sized home with 20 to 80 percent of its electrical needs depending on how many lights appliances and air conditioners are running and how efficient they are. ???After the subsidy and depending on how the system is paid for (in cash or with borrowed funds) a solar system can pay for itself in as little as six years and as much as 36 years. Owen assumes about 20 years. ???Potential solar clients moreover often mistakenly assume that going with the sun will take them off the grid which is not possible without a large bank of batteries that costs several thousand dollars more. Because the solar panels are still wired to the power grid if there is a blackout the power in a solar house goes off just like everyone else's. If uninterrupted power is needed Owen suggests a diesel generator. ???Galiteva does cite one real advantage of solar: It reduces the electricity that must be purchased from power companies and protects to some degree a solar home from the full brunt of upwardly spiraling rate increases. Unfortunately for solar enthusiasts the L.A. Department of Water and Power which was not deregulated along with the three other major utilities in California has perhaps the cheapest and most stable supply of electricity in the state making the economic argument harder to make. ???To receive the full $ 5 per watt subsidy the L.A. Department of Water and Power requires a homeowner to purchase solar panels from a manufacturer based in the city. The idea is not only to become the solar capital of the world but also to encourage local growth of an emerging industry and create jobs. ???One hitch is that no solar panel makers were located in Los Angeles. ???After lengthy negotiations Siemens Solar Industries based in Camarillo Calif. an hour's drive to the north announced in February that it would open a solar panel manufacturing plant in Los Angeles. But it is not a complete facility: The L.A. plant does only some final assembly and then the units must be returned to Camarillo for final testing and shipping. ???Tina Nickerson a spokeswoman for Siemens Solar estimates her company has sold a couple dozen to L.A. homeowners for the rebate program. But she too reports that the interest from consumers is sometimes overwhelming and that supply has been a problem. Most U.S.-manufactured units are shipped overseas to places such as Germany Japan and Scandinavia which have had generous subsidies in place for years. ???LaWanda Geary had to call Siemens herself to push them to deliver panels for her house -- and she was eligible for the rebate because of a stopgap compromise that allows to Siemens to ship solar panels from Camarillo until its L.A. plant is fully operational. ???Everyone involved concedes there have been bottlenecks. Siemens now says it has enough panels to begin to meet demand and Owen and the city are hoping things will sort themselves out especially if more solar manufacturers are drawn to Los Angeles. But proponents worry about what will happen when the subsidies run out. ???Selling solar is now the easy part Owen says. I could sell a hundred a week. It's getting them up on the roof that's the hard part. LOAD-DATE: May 29 2001 of 98 DOCUMENTS ????????????????Copyright 2001 News World Communications Inc. Washington Times ?????????????????????May 29 2001 Tuesday Final Edition SECTION: PART A NATION INSIDE POLITICS Pg. A6 LENGTH: 1264 words BYLINE: Greg Pierce THE WASHINGTON TIMES BODY: ??TAKING YOUR MEDICINE ??Oakland Mayor Jerry Brown who was once governor of California likens current Gov. ?Gray Davis' handling of the electricity crisis to his own bungling of the medfly crisis. ??Here's an analogy to the medfly crisis Mr. ?Brown said in an interview with the Los Angeles Times' Douglas Foster. ?When I first heard about the medfly I said 'Well it's just a few flies maybe they'll go away. ?Maybe they won't keep reproducing.' And the winter came and they stopped reproducing. ?And then somewhere around February or March I learned about something called 'spring emergence.' As the ground got warmer the larvae turned into flies and more medflies started appearing. It got out of hand and ultimately I had to order malathion spraying. ?It would have been better had I taken forceful action at the first notice of the medfly. ??Mr. ?Foster asked: Are you saying that the governor missed opportunities to act early in the same way? ??Mr. ?Brown replied: There's an analogy there. ?I didn't want to spray because I knew the people in Santa Clara County didn't want to have helicopters spraying malathion over their homes. ?It didn't sound good. ?As governor I wouldn't have wanted to see rate increases either. ?But sometimes you have to take your medicine early. ?It's less bitter than if you postpone it. ??Mr. ?Davis served as Mr. ?Brown's chief of staff when the latter Democrat was governor. ??ENERGETIC CRITICISM ??President Bush's energy plan already under fire from Democrats and environmentalists is dismissed by National Review the conservative magazine as so much political posturing. ??The hyperbolic attacks on the Bush plan by environmentalists (as an attempt to poison the air and kill the caribou) shouldn't trick conservatives into an exaggerated sense of its merit the magazine says in an editorial in its current issue dated June 11. ??The basic thrust of the administration's thinking on energy is sound: a growing economy requires more energy which in turn entails more production. But the Bush plan itself is a political document meant to placate corporate interests environmentalists and everyone in between and so is festooned with an embarrassment of subsidies and incentives that will at best prove an irrelevance. ??As Jerry Taylor of the Cato Institute writes in this issue the phantom energy crisis is already healing itself. ?Power plants are being built at a rate that outpaces Dick Cheney's benchmark of one plant a week. Altogether almost 100000 new daily megawatts of electrcity capacity are scheduled to be available nationwide by next year. ?This is twice the amount of electricity that California now uses on an average day. ?While Cheney has been sitting with his advisers around a White House conference table investors and entrepreneurs have been digging building and refining his energy problem into oblivion. ?By the time all the Bush plan's tax credits have kicked in there may well be an energy glut. ?All of this is thanks to the most efficient energy plan known to man: market pricing. ??WRONG ON BOTH COUNTS ??The buzz in the media after Sen. ?James Jeffords' switch put Democrats in control of the Senate was that President Bush must change his ways. ?He has to become more moderate. ?Why? ?Because only that will prevent more Republican defections and it's the president's one hope for getting his agenda through Congress. ?This is wrong on both counts Fred Barnes writes in the Weekly Standard. ??Bush and GOP congressional leaders bent over backwards to accommodate Jeffords and liberal Democrats on education the senator's top priority. Jeffords bolted anyway. ?On taxes Bush stuck with his conservative tax cut until nearly the end when he compromised just enough to assure passage. Jeffords voted with him Mr. ?Barnes said. ??The truth about the impact of Jeffords' move is that no political earthquake has occurred. ?The Senate is ideologically unchanged. ?The swing votes in the Senate including John McCain are important but they already were. ?There's no clear path to victory for the Bush agenda after taxes and education but that was always true. ?To pass a patients' bill of rights a prescription-drug benefit or missile defense a bipartisan coalition of some sort will be essential. ??Yes there's one big change with Democrats taking over: judges. ?Bush will have a harder time getting conservative nominees through a Senate Judiciary Committee run by Patrick Leahy perhaps the most partisan Democrat on Capitol Hill. ?One more downbeat side effect: Jeffords' announcement overshadowed Bush's tax-cut victory denying him any political momentum he might have gotten from it. ??INCOHERENT REBEL ??Before liberals put James Jeffords on Mount Rushmore can we please stop and note how he's already betrayed Democrats and his own avowed principles by deciding that his defection won't take effect until after President Bush's wrongheaded tax cut has been signed into law? syndicated columnist Matthew Miller writes. ??Any traitor (I mean 'man of conscience') worth his salt shoves the knife in to the hilt - otherwise what's the point? ?Machiavellis throughout history have wisely advised that when you move against the king you'd better finish him off Mr. ?Miller said. ??Yet Jeffords took pains to make sure his switch wouldn't derail the centerpiece of Bush's agenda the very agenda that inspired Jeffords' move and which Jeffords had the power to stop via his action. ??We are dealing in other words with a deeply incoherent rebel. ?This would be a private matter for Jeffords to sort out with his therapist were not his cowardice in this moment of 'courage' so consequential for the country. ??THE LONELY VERMONTER ??In the final analysis Vermont Sen. ?James M. ?Jeffords was out of step with his party making his departure appropriate if politically inconvenient. ?Those who argue that it was the party out of step with Jeffords some political analysts are saying are those who wish the Republicans no good. UPI political analyst Peter Roff writes. ??The conservative low-tax minimal-government Republican Party enjoys national parity with the Democrats something the Northeastern liberal GOP could not achieve. ?Jeffords is in that regard these observers say out of step with victory. ?One GOP consultant went so far as to say 'If the Republicans were doing better in New England Jeffords would not have been so lonely. ?Why is it that the people from states where the GOP usually doesn't win think they can tell the rest of us how to run the party and what we all should believe? ?It doesn't make sense.' (spade) ??There are those in the GOP who regret the loss of the majority that Jeffords' defection brings but very few if any are mourning the loss of the lonely Vermonter Mr. ?Roff said. ??LAST WORDS ??Brill's Content asked PR pros how they would handle Vice President Richard B. Cheney's heart problems. ??It's inconceivable that Mr. ?Cheney can put in the kind of time we're led to believe he is without putting himself at risk one public relations man John Scanlon told the magazine. ?My recipe for controlling the situation would be photo-ops access to his schedule and a couple of exclusive articles. ?He's got to convince people he's fit for the job. ??Unfortunately Mr. ?Scanlon did not live to see his quote in the magazine's June issue the New York Post reports. ?He died of a heart attack. ??* Greg Pierce can be reached at 202/636-3285 or by e-mail at gpierce@washingtontimes.com. LOAD-DATE: May 29 2001 of 98 DOCUMENTS ????????????????Copyright 2001 News World Communications Inc. Washington Times ?????????????????????May 29 2001 Tuesday Final Edition SECTION: PART A NATION Pg. A4 LENGTH: 809 words HEADLINE: Bush faces tough sell on visit to California Davis likely to be rebuffed on price caps BYLINE: Joseph Curl THE WASHINGTON TIMES DATELINE: LOS ANGELES BODY: ??LOS ANGELES - Twenty minutes - that's how long Gov. ?Gray Davis who has accused the Bush administration of ignoring California's energy crisis will have to sway President Bush in a meeting today to consider imposing federal price caps on wholesale power prices. ??His plea likely will fall on deaf ears. ??That's simply not going to happen said one senior Bush official. Both Mr. Bush and Vice President Richard B. ?Cheney who on Friday again blamed the state government of California for the energy crunch oppose cap measures. ??In his first visit to California since the presidential election where he lost the state to former Vice President Al Gore by 54 percent to 41 percent Mr. Bush hopes to sell his national energy policy to a vocal group of opponents. But the hue and cry has been muted of late since residents have battled rolling blackouts and sky-high gasoline prices. ??A new poll released Friday shows 59 percent of Californians many of whom have been longtime foes of nuclear energy now believe the non-polluting energy source may be the way to solve the state's problems. ??Mr. ?Davis' popularity has plummeted. ?The Democrat facing re-election next year and often mentioned as a presidential candidate is viewed as having poor job performance by 60 percent of Californians according to a survey by the Public Policy Institute of California. ??In a small gesture to California Energy Secretary Spencer Abraham yesterday announced plans to increase transmission capacity in California which he said would be a big step in easing rolling power blackouts. ??Abraham ordered the Western Area Power Administration - an Energy Department arm responsible for marketing electricity from federal water projects in 15 Western states - to wrap up planning for building extra transmission capacity. ??The governor has repeatedly blamed Mr. ?Bush who took office four months ago for the energy crunch in California. ?He points the finger of blame far outside the state's boundaries primarily at Washington and Mr. Bush's home state. ??The people that have dropped the ball are the federal government Mr. Davis said last week. ?They need to reimpose a price cap because we're being obscenely gouged by price gougers out of Texas and the Southwest. ?. . . There's a massive transfer of wealth going on from ordinary citizens in California to Texas. ??Mr. ?Davis has also charged that utility companies are withholding power in order to drive up prices a claim the Federal Energy Regulatory Commission has investigated and dismissed. ??Mr. ?Bush and Mr. ?Cheney have often pointed out that California is second only to Rhode Island in conservation efforts but the state is on the brink of an energy supply collapse. ??Still despite the state's failure to build new power plants Mr. Davis says California is entitled to a federal bailout approved by Mr. Bush. ??I'm going to keep asking him to do it because we're part of America. The state the last three years has led American economic growth. ?. . . We're doing everything we can out here he said. ??In the Democratic response to the president's weekly radio address Mr. Davis accused the president a former oil man of being concerned only with the petroleum magnates. ??With all due respect I urge you to stand up to your friends in the energy business and exercise the federal government's exclusive responsibility to ensure that energy prices are reasonable he said. ??Many analysts however blame the state's deregulation scheme and failure to construct adequate electrical generating capacity. ?The price wholesale power providers can charge utilities is not capped but the fee those companies can charge users is capped - resulting in massive debt for providers. ??The state was slow to respond to increased demand the analysts say even though the state is building 10 new power plants four of which will come on line this summer. ??In his national energy policy Mr. ?Bush lays out 105 proposals that focus on increasing domestic supply improving the nation's ability to move energy between regions and increased conservation. ?But the policy is geared more toward long-term solutions - such as decreasing America's reliance on foreign oil - than short-term relief for Californians and motorists nationwide. ??Mr. ?Cheney who heads the president's energy task force and said Friday that California knew for more than a year about the impending energy shortage has promoted nuclear power as essential to America's energy needs. ?He said that at least some of the 65 power plants that need to be built annually to meet future electricity demand ought to be nuclear. ??A poll by the Field Institute last week found many Californians now agree. Although nuclear energy produces 20 percent of the nation's energy California has just two nuclear plants. GRAPHIC: Photo Gov. ?Gray Davis LOAD-DATE: May 29 2001 of 98 DOCUMENTS ????????????????????Copyright 2001 Chicago Tribune Company Tribune ???????????????May 29 2001 Tuesday NORTH SPORTS FINAL EDITION SECTION: News Pg. 6 ZONE: N LENGTH: 514 words HEADLINE: Bush backs WW II project BYLINE: From Tribune news services. DATELINE: LOS ANGELES BODY: ??President Bush promised World War II veterans a Washington memorial that will stand for the ages and paid Memorial Day tribute to America's fallen soldiers before embarking on a three-day West Coast swing to try to ease his political problems in California. ??Bush landed at ground zero of the nation's energy worries Monday night hours after Energy Secretary Spencer Abraham speeded up planning to relieve a notoriously overloaded electricity transmission line through California. ? ??Abraham's action was timed to provide a bit of news for Bush to announce during his first presidential trip to California where he is to hold a politically charged private meeting with Democratic Gov. Gray Davis on Tuesday. Bush's aides said he will pledge to cooperate with California but will stick to his position that no action by the federal government can prevent the rolling blackouts that are expected this summer. ??Abraham ordered the Western Area Power Administration a 15-state marketing arm of his department to complete planning and seek outside financing for an increase in transmission capacity that he said would be a big step in the right direction and a big step forward for Californians. ??California's electricity problems developed over a period of years and cannot be solved overnight Abraham said in a news release. However we can move now on actions that will help avert the same types of problems from recurring year after year. Monday's action is designed to reduce the bottleneck on California's Path 15 which connects the northern and southern parts of the state. ??Davis who is seeking re-election next year has seen his poll ratings plummet as electricity prices soared utilities hit dire financial straits and homes and businesses were surprised with blackouts. ??For most of Monday however Bush focused on U.S. veterans and the solemn ceremonies in two states honoring those who never returned from America's wars. ??Their losses can be marked but not measured Bush said at the traditional Memorial Day ceremonies at Arlington National Cemetery in Virginia. We can never measure the full value of what was gained in their sacrifice. We live it every day in the comforts of peace and the gifts of freedom. ??Bush also laid a wreath at the Tomb of the Unknowns. ??Later he traveled to Mesa Ariz. to pay tribute to veterans at the Champlin Fighter Aircraft Museum. He asked the crowd to observe a nationwide moment of silence at 3 p.m. Arizona time. ??Any foe who might challenge our national resolve will be repeating the grave error of defeated adversaries the president said. ??Bush opened the day at the White House where he signed legislation to construct a World War II monument on the National Mall a setting criticized by some. Bush said the monument between the Washington Monument and Lincoln Memorial will stand for the ages. ??I will make sure the monument gets built the president told an audience of veterans in the yellow-curtained East Room among them former Sen. Bob Dole (R-Kan.) who has supported the memorial. ??. GRAPHIC: PHOTOPHOTO (color): President Bush and Maj. Gen. James T. Jackson attend Monday's wreath-laying at Arlington National Cemetery's Tomb of the Unknowns. AP photo by Ron Edmonds. LOAD-DATE: May 29 2001 of 98 DOCUMENTS Associated Press The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????May 29 2001 Tuesday BC cycle AM Eastern Time SECTION: Domestic News LENGTH: 604 words HEADLINE: Bush announcing low-income aid but no price caps BYLINE: By SCOTT LINDLAW Associated Press Writer DATELINE: LOS ANGELES BODY: ??President Bush traveled across the country to deliver news Gov. Gray Davis doesn't want to hear: He won't force down soaring electricity prices that have cost California nearly $8 billion since January. ??The Republican president and the embattled Democratic governor arranged a 20-meeting Tuesday to talk about California's energy crisis but there was no indication they would break their stalemate. ??Bush opposes price limits on wholesale electricity that utilities buy arguing they do nothing to address supply-and-demand issues at the heart of the crisis. ??Davis contends federal energy regulators are ignoring their mandate to ensure just and fair electricity prices. ??With no sign of a break in the deadlock each side maneuvered for maximum advantage from Bush's first full day in California as president. ??Davis in an interview Tuesday on ABC's Good Morning America defended his record on licensing more power plants. ??We've licensed 15 plants. Ten are under construction four will be online this summer four next summer and by the end of 2003 we will have built our way out of this problem. But between now and then we are getting gouged unbelievably Davis said. ??The Bush administration timed positive energy announcements to coincide with the president's visit. ??At the Marine Corps base at Camp Pendleton Bush was announcing the expansion of a program that provides federal money to help low-income residents pay for power. ??Bush was proposing $150 million in addition to $300 million already budgeted for a component of the Low Income Home Energy Assistance Program to provide special help to cash-strapped residents of California and certain Midwest areas such as Chicago a senior administration aide said. ??Bush was also reminding state residents of his order that military facilities in the state cut peak-hour usage by 10 percent. ??To alleviate an electricity bottleneck on a crucial south-north transmission path the Department of Energy announced that the Western Area Power Authority will try to raise money from a variety of private and public entities to finance a crucial additional lines. ??The Bush administration is taking a leadership role in addressing a long-neglected problem in California's electricity transmission system said Energy Secretary Spencer Abraham. California's electricity problems developed over a period of years and cannot be solved overnight. However we can move now on actions that will help avert the same types of problems from recurring year after year. ??Davis had a letter for Bush from top economists who maintain price caps are justified and necessary. ??Aides to the governor expressed amazement that Bush would travel all the way to California with no major announcement in hand and predicted Davis would respond with polite rage. ??Mindful of the national stage he commanded Davis planned a news conference to air his grievances. And he convened a panel of families he said have been victimized by the energy crisis in the same hotel where Bush was staying. ??Davis wants Bush to pressure the Federal Energy Regulatory Commission to impose stiff price caps. ??Tuesday limited caps ordered last month by FERC go into effect in California but only when electricity reserves fall below 7.5 percent in the state - a step Davis called inadequate. ??Protesters planned demonstrations in Los Angeles and at Camp Pendleton in San Diego County. ??Bush also arranged a speech on energy and trade to the Los Angeles World Affairs Council and planned to president over a closed-door energy round-table discussion. GRAPHIC: AP Photos DSM106 KDJ102 LOAD-DATE: May 29 2001 of 98 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????May 29 2001 Tuesday BC cycle AM Eastern Time SECTION: State and Regional LENGTH: 594 words HEADLINE: Stakes are high for Davis meeting with Bush BYLINE: By GARY GENTILE AP Business Writer DATELINE: LOS ANGELES BODY: ??With California facing a summer of outages Gov. Gray Davis was to meet President Bush to press for a federal cap on energy prices. ??But Davis wasn't expected to win any concessions during the 20-minute Tuesday meeting where he's expected to point to Texas energy makers. ??Davis has appeared on national news programs attacking Bush for opposing price controls on wholesale electricity and suggesting the president has ignored price-gouging by Texas-based electricity generators. ??The president did not create this problem but he is uniquely situated to solve it Davis said Monday. What I'm going to ask him to do with all respect is to enforce federal law. The money that leaves this state goes directly to energy companies in Texas and the Southwest. ??If Bush refuses to administer price controls as expected Davis can use that as ammunition in his sparring with the administration. ??Bush has blamed California officials for the state's power woes and said price controls won't solve shortages. Instead they said Bush plans to stress his efforts to conserve energy in federal buildings and will bring one or two new initiatives to the table. ??One of them commits the federal government to helping organize a consortium to build more power lines for the state. ??Energy Secretary Spencer Abraham directed the Western Area Power Administration a federal agency to take the first steps to clear the way for building more transmission capacity between southern and northern California. That would help relieve a transmission bottleneck in the central part of the state. ??While this will not help this summer Abraham said in a statement the line improvements when completed will help avert the same types of problems from recurring year after year. ??The stakes of the meeting are high for both politicians. ??Davis who has been mentioned as a Democratic challenger to Bush in 2004 wants federal help to solve an energy crunch that threatens rolling outages this summer and has cost state taxpayers nearly $8 million since January - the price of buying power for two cash-starved private utilities. And his plan to rescue one of those companies reportedly is faltering. ??Leaders of both the state Senate and Assembly oppose a $3 billion-plus plan to bail out Southern California Edison by buying its power lines the Los Angeles Times reported Monday. ??Bush meanwhile needs to mend fences in vote-heavy California. The Republican president lost badly here in November and polls show most Californians dislike his handling of their energy crisis. ??Bush's Tuesday agenda was heavy on energy issues. At the Marine Corps base at Camp Pendleton near San Diego Bush was to highlight his order that federal agencies and installations cut back energy use. Then it was on to Los Angeles to discuss his energy plan in a speech to the Los Angeles World Affairs Council. ??Bush was confronted by the issue virtually as he stepped off the plane Monday in Los Angeles. Rep. Brad Sherman D-Los Angeles escorted the Academic Decathlon national championship team from El Camino Real High School in Woodland Hills to meet Bush. He told the president California needs regulation of electric generators. ??The president seems to believe just by instinct that rate regulation reduces supply and also by instinct that all those in the energy industry are fair people who are not trying to game the system Sherman said. Anyone who studies the facts in California knows that power is being withheld in order to drive up the price. LOAD-DATE: May 29 2001 of 98 DOCUMENTS ????????????????Copyright 2001 Burrelle's Information Services NEWS ??????????????????????SHOW: WORLD NEWS NOW (2:00 AM ET) 28 2001 Monday TYPE: Newscast LENGTH: 447 words HEADLINE: PRESIDENT BUSH VISITS CALIFORNIA WHERE POLITICIANS ARE CRITICAL OF HIS LACK OF ACTION FOR THEIR ENERGY CRISIS ANCHORS: DEREK McGINTY REPORTERS: JOSH GERSTEIN BODY: ??DEREK McGINTY co-anchor: ??When Air Force One touches down in California today it will mark President Bush's first visit to the Golden State since taking office. Now that fact has not been lost on Governor Gray Davis who has accused the president of ignoring his state's power crisis. ?As ABC's Josh Gerstein tells us Mr. Bush's visit could have major ramifications for his presidency and his party. ??JOSH GERSTEIN reporting: ??(VO) Since taking office President Bush has visited 28 states but until this week he had not found time on his schedule to visit the nation's most populous state California. ??Mr. DAN SCHNUR (GOP Political Consultant): Because the state is going through such extraordinary times right now because of the energy crisis his absence has been much more noticeable and the discussion about it's been much more heightened. ??GERSTEIN: (VO) Democrats have begun an aggressive effort to paint the president and other Republicans as obstacles to resolving the energy crisis. ??Offscreen Voice: (From TV Commercial) President Bush has offered no relief to hard-pressed rate payers. ??Text: ??The President...believe(s) that the issue is mostly a California matter... ??GERSTEIN: (VO) On Tuesday Mr. Bush meets with California Governor Gray Davis. ?He and other Democrats want the federal government to impose caps on wholesale prices for electricity. ??Representative ANNA ESHOO (Democrat California): Our people are hurting. We're bleeding in the sand. ?We need a tourniquet and the president is the one that can do this. ??GERSTEIN: (VO) During his trip President Bush plans to highlight the federal government's conservation efforts but aides say he will not endorse price caps. ??Mr. TUCKER ESKEW (Director White House Media Affairs): The president believes that capping wholesale prices would do nothing to lower demand or increase supply the two fundamental solutions to any energy problem such as this. ??GERSTEIN: Holding the line against price caps may have political costs. Most analysts give Mr. Bush little chance of winning California in 2004 but Republican congressmen there face re-election next year. ?So far five of them have endorsed some kind of limit on electricity pricing. ??Representative RANDY CUNNINGHAM (Republican California): We're in an extreme emergency right now. ?It takes extreme measures. ??Unidentified Woman: We are in rolling blackouts. ??GERSTEIN: (VO) While electricity may be in very short supply in California this summer the president and politicians of all stripes are likely to find there's more than enough voter anger to go around. ?Josh Gerstein ABC News the White House. LOAD-DATE: May 29 2001 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: In DC with Ken Lay per Desiree, CEO luncheon with Secty Rubin Body:: Desiree will schedule other appointments as well Cynthia will attend in your place. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Rich Products Body:: looks good Peggy Mahoney 07/24/2000 06:20 PM To: Mark Palmer/Corp/Enron@ENRON Steven J Kean/HOU/EES@EES Karen Denne/Corp/Enron@ENRON Cedric Burgher/Corp/Enron@ENRON Mark Koenig/Corp/Enron@ENRON Paula Rieker/Corp/Enron@ENRON Jeremy Blachman/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Karen S Owens@ees@EES Kevin Hughes/HOU/EES@EES Mark S Muller/HOU/EES@EES Vicki Sharp/HOU/EES@EES Marty Sunde/HOU/EES@EES Dan Leff/HOU/EES@EES Elizabeth Tilney/HOU/EES@EES Dave S Laipple/DUB/EES@EES James E Keller/HOU/EES@EES cc: Subject: Rich Products Please review the attached draft news release about our agreement with Rich Products and let me know if you have any comments by 5pm Tuesday July 25. We are scheduled to release on Wednesday July 26. If you have any questions please call me at x57034. Rich Products is a major US food manufacturer headquartered in Buffalo NY. The company ranked #122 in Forbes Private 500 and has sales around $1.5 billion. Rich Products is owned and operated by the founding Rich family. Products manufactured include frozen meats bakery products and non-dairy creamers. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Project Stanley Body:: Please revise the document as Aleck's changes indicate. With respect to the alternative responses shown near the end of the document leave both alternatives in. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: release draft Body:: revisions From: Mark Palmer on 06/07/2001 01:46 PM To: Paula Rieker/Corp/Enron@Enron James A Hughes/Enron@EnronXGate David Leboe/Enron@EnronXGate Andrew S Fastow/Enron@EnronXGate Steven J Kean/NA/Enron@Enron Karen Denne/Corp/Enron@ENRON cc: Subject: release draft Please get back to me ASAP. Mark Palmer 34738 What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Update Day 1 Second Session FERC CA Settlement Body:: In the Room Conference attended by all in-state generators a few munies the IOUs and a few others. One attorney from CPUC but on phone. Barbara Barkovich attended for CA Large Consumers. Nader sent someone. No other consumers. One other ESP -- Strategic Energy (only operates in San Diego). Judge reports that only 6 offers have been submitted to FERC for sales to the IOUs (note Enron submitted one of the offers). The offers total 2000 MW. The prices are quite divergent. He expresses concern at the little offered. Generators suggest that more could be offered if FERC could be more flexible on terms (FERC required 24/7 offers). IOUs and others press judge to seek offers from others not present (e.g. BPA other marketers SW utilities) but judge does not offer to do so. Barkovich says can't throw large customers into non-core market now. Everyone agrees that we are all looking for a blended wholesale rate (part existing gen part OFs part forward contract and part spot) that meshes with the IOUs' ability to recover the costs in rates -- so tied to CPUC rate increase. Discussion of CPUC PD -- not enough Enron able to take low profile. SDG&E suggested terminating the settlement talks at FERC saying nothing could be achieved. Not much happens until 4:30 pm when judge blows up -- judge directed epithets at SDG&E and SCE. SCE had refused to cooperate from the beginning. Out of the Room Separate talks between PG&E and SDG&E and some of the generators. Late in the day Judge meets with IOUs. Parties agree informally that forum does not work well given lack of CPUC involvement but some believe that FERC is only hope for a workable resolution. Next Steps -- The Judge Speaks Judge asked everyone to consider how to Share the Pain for Thursday's meeting and said not to expect any win:win scenario. His view is that FERC is better than the CA legislature or bankruptcy court. His focus will be on Wolak proposal to share the pain as submitted in 12/1/00 comments to FERC -- forces all sellers to CA to sell most of its supply (either generation or marketer offers) as cost-based rates in forward contracts or lose ability to sell at market-based rates. Generators oppose this I believe. Enron planning to continue low profile but to discuss options with ENA. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Part 4, revised Body:: nan What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Madera Ranch Press Release Body:: Heads up. This is not to be discussed in advance out side of Enron but you guys need to know. If there are ways we can be helpful call Carolyn Green to discuss. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CNN Link Update Body:: I think this is a good idea. We may want to think about CNBC as well. Brandon -- any technical obstacles? Margaret/Cindy -- how does the link work? does it go straight to the clip or do users have to navigate within CNN's site? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Senate Energy Markup Cancelled Body:: The Senate Energy Committee's meeting to consider and vote on Chairman Bingaman's electricity restructuring legislation and amendments to that proposal -- originally scheduled for tomorrow -- has been CANCELLED. No new date has been announced. Given the tragic events yesterday at present we expect congressional activity to be suspended following today's sessions until into next week. We will keep you posted on further details as they become available. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: confidential ee info Body:: Mark Can you email me or fax me any written documentation we have give to Heidi in regard to performance. I have her reviews but thought we did some other written documentation. Let me know. Thanks. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: REVISED: Meeting with Antoinette Malveaux re: National Black MBA Association May 8th Body:: meeting file ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Mark has some editorial changes to the letter if there is still time What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: The Answer! Body:: enjoy! ----------------- What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Final Colorado Springs, CO Itinerary Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: test message Body:: Testing Notes capabilities of your Enron home computer. What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Digital Power Demand: JP Morgan Report Body:: See if there is anythiing of use in here for your high tech group messages. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ATTORNEY CLIENT PRIVILEGDE - Draft FERC Brief on Settlement Process Body:: see below. Federal price limits backfire=20 Some generators withhold power rather than abide by rate caps=20 David Lazarus Chronicle Staff Writer Wednesday July 4 2001=20 2001 San Francisco Chronicle=20 URL:=20 /04/M N186091.DTL=20 Officials in California and Nevada after months of lobbying for federal=20 regulators to cap Western power prices warned yesterday that the newly=20 imposed limits have had the unintended consequence of increasing a threat o= f=20 blackouts in the two states.=20 The warnings were issued as California came within minutes of rolling=20 blackouts yesterday afternoon and one day after the first-ever rolling=20 blackouts in Las Vegas forced energy-hungry casinos to shut off fountains a= nd=20 reduce air conditioning.=20 The two states are asking the Federal Energy Regulatory Commission to take = a=20 closer look at the so-called price mitigation plan and come up with revisio= ns=20 that would deter power companies from withholding electricity during=20 shortages.=20 We need some clarity to this order said Oscar Hidalgo a spokesman for t= he=20 California Department of Water Resources which is spending billions of=20 dollars to keep the state's lights on.=20 Generators need to be held accountable he said.=20 The crux of the problem is that price limits kick in during shortages yet= =20 power companies say these caps force them to sell power at below-market rat= es=20 during periods of high demand.=20 Some companies have responded by holding back power rather than face the=20 expense of shipping electricity from state to state. Each mile that=20 electricity must be transmitted adds to the overall cost.=20 No one's going to pay for transmission if the cost is near the caps said= =20 Gary Ackerman executive director of the Western Power Trading Forum an=20 energy-industry association in Menlo Park.=20 Ackerman said several companies in his organization decided that there was = no=20 economic advantage to offering power in regional markets when price control= s=20 are in effect.=20 This means individual regions like California or Las Vegas could end up no= t=20 having enough Ackerman said. It increases the threat of blackouts.=20 BLACKOUT ALERT CANCELED California authorities issued a blackout alert at 1:45 p.m. yesterday when= =20 power reserves dipped to dangerously low levels. They canceled the alert=20 about an hour later after finding additional supplies.=20 Everyone in the West is fighting for megawatts said Stephanie McCorkle = a=20 spokeswoman for the California Independent System Operator which oversees= =20 the state's power network.=20 The Golden State's latest brush with lights-out conditions came a day after= =20 Nevada experienced its own rolling blackouts for the first time prompting= =20 heavy power users such as the MGM Grand and Caesars Palace to dim their=20 lights.=20 Don Soderberg chairman of the Nevada Public Utilities Commission said tha= t=20 the sudden power emergency took state authorities by surprise and that they= =20 are investigating to see what role the federal price limits may have had in= =20 exacerbating Monday's shortage.=20 We're looking very closely at this he said. There seems to be a potenti= al=20 for unintended consequences.=20 Specifically Soderberg said Nevada is focusing on operators of older less= -=20 efficient plants who would find profit margins shrinking if not vanishing= =20 under capped prices.=20 We're going to see how the caps might have played into this he said.=20 The federal ceiling in 10 Western states excluding California is about $9= 2=20 per megawatt hour. In California a 10 percent surcharge is added because o= f=20 the state's credit risk bringing the price to just over $101.=20 Ackerman at the Western Power Trading Forum said regional price controls ha= ve=20 extended California's power crisis to neighboring states.=20 California sneezed and the rest of the region caught the virus he said.= =20 'LAWYERS LOOKING FOR LOOPHOLES'=20 California and Nevada officials however said that they still have faith= =20 that price limits can stabilize Western electricity markets but that federa= l=20 regulators may have to tweak the system so that power companies cannot=20 withhold output.=20 The generators have banks of lawyers looking for loopholes (in the plan)= =20 said Hidalgo at the Department of Water Resources.=20 Unfortunately it may take some time for the regulators to revisit an issue= =20 that they took up only with the greatest reluctance. For months federal=20 regulators refused to impose price controls preferring instead to let supp= ly=20 and demand determine costs.=20 Hidalgo said that when it appeared that power companies were throttling bac= k=20 on output Monday California officials immediately dialed the hot line numb= er=20 provided by the Federal Energy Regulatory Commission in case of emergencies= .=20 No one answered he said. They were closed.=20 State officials tried again yesterday and this time were told that the=20 commission would look into the matter. They were not given a time frame for= =20 when the commission might come up with a response.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 Out-of-state generators pull plug over uncertainty on price controls By Dale Kasler Bee Staff Writer (Published July 3 2001)=20 Confused by the federal government's new controls on electricity prices=20 generators withheld so much power from California on Monday that the state= =20 was nearly plunged into rolling blackouts state officials said.=20 The confusion began when the state's electric grid operators declared a Sta= ge=20 1 power alert in the early afternoon triggering the price caps for the fir= st=20 time since they went into effect June 21.=20 Out-of-state generators pulled about 1500 megawatts of electricity off the= =20 table at midafternoon enough to power about 1.1 million homes because of= =20 uncertainty about how much they could charge under the new Federal Energy= =20 Regulatory Commission pricing system said Oscar Hidalgo spokesperson for= =20 the state Department of Water Resources. The department buys electricity fo= r=20 the state's financially distressed utilities.=20 They didn't understand what they were going to be paid there was confusio= n=20 over the FERC order Hidalgo said. We saw 1500 megawatts disappear.=20 The problem was exacerbated by a heat wave across the West which forced=20 California to compete with other states for scarce electricity he said.=20 Rolling blackouts hit southern Nevada.=20 Most California officials credit the FERC system which is based on a=20 variable price cap with reining in what had been a runaway wholesale power= =20 market. But power generators have complained that the price caps by limiti= ng=20 profits could discourage the production of critically needed electricity.= =20 And as Monday's episode suggested even the uncertainty about where the cap= =20 will fall could lead to unexpected shortages.=20 That's the risk that you run (with price controls) said Arthur O'Donnell= =20 editor of the newsletter California Energy Markets. People want any kind o= f=20 certainty at all.=20 Hidalgo said the state avoided blackouts only because of last-minute import= s=20 from the Bonne=0F'ville Power Administration the federal agency that marke= ts=20 government-produced hydroelectric power in the Pacific Northwest. The state= =20 went into a Stage 2 power alert the next-to-last level before blackouts ar= e=20 ordered. The alert was canceled in late afternoon.=20 The blackouts would have been the first in California since May 8.=20 FERC imposed a round-the-clock ceiling on power throughout the West. The=20 price fluctuates and is tied to the production costs of the least-efficient= =20 plant operating in California during a power alert declared by the=20 Independent System Operator which runs the state's power-transmission grid= .=20 When there's no alert prices can't exceed 85 percent of the cap that was= =20 established during the latest alert.=20 Until Monday the maximum price held steady at about $101 a megawatt-hour i= n=20 California. But when the ISO declared a Stage 1 power alert in early=20 afternoon signifying that reserve supplies had dwindled to less than 7=20 percent of demand confusion set in Hidalgo and others said.=20 Because of a steep drop in the price of natural gas which fuels many=20 California power plants suppliers knew the cap would fall. But no one knew= =20 by how much until the price was posted by the ISO.=20 The ceiling for California fell to about $77 at 3 p.m. but was back up to $= 98=20 in two hours according to the ISO. Those prices include the 10 percent=20 premium that sellers can charge California because FERC said there's a cred= it=20 risk in selling to the state.=20 O'Donnell said it's likely suppliers will pull back from the market every= =20 time the ISO declares a power alert.=20 In-state generators have to operate their plants if summoned by the ISO. Bu= t=20 out-of-state suppliers can withhold supplies and on Monday it was the=20 out-of-staters that were pulling back Hidalgo said.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m.=20 Power Sales Halted by New Pricing Curbs=20 Electricity: Confused suppliers unsure what they will be paid refuse to= =20 sell to state which asks FERC for a ruling but doesn't get it.=20 By NANCY VOGEL Times Staff Writer=20 ?????SACRAMENTO--Confusion over new federal price restrictions prompted=20 several electricity sellers to back away from sales to California on Monday= =20 afternoon pushing the state closer to blackouts energy officials said. ?????The state lost sales that would have provided enough electricity to=20 supply more than 1 million homes said Ray Hart deputy director of the=20 California Department of Water Resources which has been buying much of the= =20 state's electricity since January. ?????At least five companies producing or marketing power are telling us= =20 that since they don't know what they're going to get paid they're not goin= g=20 to take the risk and so they're not going to sell the energy Hart said. ?????The electricity sales fell through after power consumption soared in= =20 summer heat and grid operators were forced to declare a Stage 1 emergency= =20 meaning reserves had dipped below 7%. It was the first such emergency since= =20 May 31. ?????Under a June 19 order by the Federal Energy Regulatory Commission=20 intended to bring down wholesale electricity markets across the West a pow= er=20 emergency in California triggers the setting of a new price limit that=20 applies to power plant owners from Washington to Arizona.=20 ?????The new price is supposed to be based upon whatever it costs to run th= e=20 most inefficient expensive power plant selling electricity to California= =20 grid operators during the first full hour of a Stage 1 emergency. ?????But much uncertainty remains about exactly how and when the new price = is=20 supposed to be established under the commission's order and that apparentl= y=20 drove away sellers Hart said. ?????Shortly after the state issued the Stage 1 alert at 1:30 p.m. putting= =20 the old price limit of $90 per megawatt-hour in question companies that ha= d=20 committed to provide the state electricity hour by hour Monday afternoon=20 backed out Hart said. The companies include TransAlta Energy Marketing of= =20 Oregon Constellation Power of Baltimore and Sempra Energy Trading a unit = of=20 the San Diego-based energy conglomerate. ?????Forced to dip even deeper into the state's power reserves and declare = a=20 Stage 2 emergency water agency officials called the federal energy=20 commission's hotline for clarification about what the new price should be a= nd=20 when it should take effect. They got no answer. ?????Hart said commission officials reached at home promised to try to=20 clarify their order today. One outstanding question is what obligations pow= er=20 suppliers have to deliver electricity to California in an emergency. ?????Both buyers and sellers in the market agree that the new price when i= t=20 is set will probably be lower than $90 per megawatt-hour because the price= =20 of natural gas the main fuel in California power plants has dropped latel= y. ?????Temperatures soared several degrees higher Monday than grid operators= =20 had anticipated. But they said they expected to avoid rolling blackouts in= =20 part because the Bonneville Power Administration in Portland Ore. had=20 agreed to provide several hundred megawatts of Pacific Northwest hydropower= =20 each hour in exchange for a return of electricity from California later thi= s=20 summer. ?????Bonneville is giving us emergency power to get us through Hart said= .=20 Copyright 2001 Los Angeles Times=20 James D Steffes 07/06/2001 10:04 PM To: Jeffrey T Hodge/Enron@EnronXGate Robert C Williams/Enron@EnronXGate cc: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda=20 Robertson/NA/Enron@ENRON Alan Comnes/Enron@EnronXGate Jeff=20 Dasovich/NA/Enron@Enron Susan J Mara/NA/Enron Robert Frank/NA/Enron@Enron= =20 Ray Alvarez/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON=20 dwatkiss@bracepatt.com=20 Subject: ATTORNEY CLIENT PRIVILEGDE - Draft FERC Brief on Settlement Proces= s The attached is a rough draft of a potential filing Enron would make in to= =20 Judge Wagner in the Settlement process (it is unclear if this would remain= =20 confidential per the gag order). Please provide Ray Alvarez your comments. This would be filed as early as= =20 Monday am. Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Update--0717.01 Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - April-01 AMEX Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: washington contacts Body:: I talked with Scott Tholan and he immediately understood your concerns. I don't think there is anything else you need to do right now. Let me know though if there are requests for information you consider inappropriate. From: Cynthia Sandherr 09/14/2000 11:53 AM To: Steven J Kean/NA/Enron@Enron cc: Joe Hillings/Corp/Enron@ENRON Richard Shapiro/HOU/EES@EES Chris Long/Corp/Enron@ENRON Subject: washington contacts Steve: As discussed I spoke with Clay and raised the points we discussed. Thus I'm a bit surprised to receive this cover type memo. To be clear with you as I was with Clay (he repeated back my message verbatim so I feel he understood the issue) the issue is not maintaining excellent relationships rather the issue is inappropriate requests for insider information. By the way the Administration meeting which set off the problem Clay stated he doesn't remember where that information came from. I have followed up with DOE and the Hill as discussed. Please let me know if we need to do anything further. thanks. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: West Virginia Settlement Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Barton Subcommittee Approves California Bill; Price Caps Defeated Body:: The Energy and Air Quality Subcommittee meet for almost six hours today and approved an amended version of H.R. 1647 Chairman Barton's emergency legislation to aid California by a 17-13 party line vote. The full Energy and Commerce Committee may take it up as early as next week (probably Thursday May 17th). The Subcommittee DEFEATED an amendment by Rep. Waxman (D-CA) to impose wholesale price caps for 18 months. The amendment was defeated 12-20 with all Republicans voting against including the three from California and Rep. Greg Walden (R-OR) who while seen as the last to decide to oppose the price cap amendment was the most forceful and articulate in opposition to the amendment. Also voting NO were Democratic Reps. Ralph Hall (D-TX) and Chris John (D-TX) with which we had met in recent days. The final vote tracked our whip count going into the meeting. Rep. Albert Wynn (D-MD) offered and withdrew an amendment to delete the negawatts provision. There was bipartisan criticism that while the concept made sense there were potential problems in terms of possible games playing including end users being able to sell power while not actualy reducing their normal power levels. Another member said that electric coops that are required to sell at cost could have customers then go out and resell that power and make a lot of money. Several Members said businesses could shut down put workers out of work and become energy marketers and make more money. Chairman Barton made a forceful defense of negawatts. While the amendment to strike was deleted we will need to respond to these criticisms and shore this up before full committee next week. There will be another attempt to delete at full committee unless these concerns are addressed in an amended version. Ranking Democrat Rick Boucher (D-VA) offered and withdrew an amendment to reinstate FERC maximum prices for the secondary transmission market thus reversing the Feb. 2000 FERC order. This woudl last for 18 months. Chairman Barton said he agreed with Boucher that there is a problem with what appear to be high gas transmission rates to California but he disagrees with the proposed remedy. He pledged to work with Boucher before Full Committee mark-up. We are obtaining a copy of this amendment and should analyze it ASAP for its potential impact on Enron operations. Rep. Ed Markey (D-MA) offered and withdrew an amendment to impose a series of new tests to be administered by FERC all with the goal of discouraging spot market transactions or at least what he would define as excessive use of the spot market and at the same time encourage deep bilateral mechanisms. The mechanisms included a market balance test that would say only sellers with a commitment to the long term market could sell in the spot market at unregulated rates and spot market circuit breakers that would be triggered when reserves are low in a given market. Chairman Barton said he likes the concept of a spot market circuit breaker but felt that the amendment was too complicated to be evaluated today. We will also pursue an analysis of this amendment since it will likely be offered again in some form. Mr. Markey also offered and withdrew a net metering proposal that would establish federal interconnection standards for individual consumers who would want to use fuel cells and other renewable technology to put power onto the system. It was interesting that those who opposed negawatts spoke favorably of net metering even though they are complementary. The subcommittee by voice vote adopted a Walden Amendment to strike the section of the bill that would have required an RTO if 10 of the western governors approved it. The debate was pro-RTO but the rationale for deleting the provision is that one is already being formed and Members from those states did not want to upset the work already under way. A series of other amendments on other matters were offered and withdrawn none of which relate to our activities. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:SALISBURY HOLDEN - 503-464-3835 Enron Wholesale Services - Office of the Chairman From: Mark Frevert Chairman & CEO Mark Haedicke Managing Director & General Counsel Subject: Confidential Information and Securities Trading To keep pace with the fluid and fast-changing demands of our equity trading activities Enron Wholesale Services (EWS) has recently revised its official Policies and Procedures Regarding Confidential Information and Securities Trading (Policies and Procedures). These revisions reflect two major developments: (1) our equity trading activities have been extended into the United Kingdom and (2) in an effort to streamline the information flow process the Review Team will play a more centralized role so that the role of the Resource Group is no longer necessary.You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: If you have already certified compliance with the Policies and Procedures during the 2001 calendar year you need not re-certify at this time although you are still required to to review and become familiar with the revised Policies and Procedures. If you have not certified compliance with the Policies and Procedures during the 2001 calendar year then you must do so within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: PRC MEMO from Skilling Body:: I think the memo needs some additional work. I have made a number of suggestion (highlighted on the attached). From: Karen Moore/ENRON@enronXgate on 04/30/2001 07:56 AM To: Cindy Olson/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Karen Denne/Corp/Enron@ENRON Michelle Cash/HOU/ECT@ECT David Oxley/ENRON@enronXgate Andrea Yowman/Corp/Enron@ENRON Gina Corteselli/ENRON@enronXgate Robert K Jones/NA/Enron@Enron cc: Subject: PRC MEMO from Skilling Attached is a draft of the PRC memo to go out from Jeff at the end of this week for your review. Karen Denne Michelle Cash and Gina Corteselli have reviewed the document and their comments/edits/suggestions have been made accordingly. Please have your responses to me no later than COB Wednesday May 2 2001. Thanks Karen What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Letter to Lynch from Us Describing Info ISO should release sooner Body:: Thanks..... what's a BEEP? Jeff Dasovich Sent by: Jeff Dasovich 10/02/2000 05:53 PM To: skean@enron.com Tim Belden/HOU/ECT@ECT cc: Subject: Letter to Lynch from Us Describing Info ISO should release sooner What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: NASCAR Craftsman Truck Series Proposal Body:: Thank you for the information. Unfortunately we are not interested at this time. Lorna Clark on 05/16/2001 08:59:39 PM To: Steve Kean cc: Subject: NASCAR Craftsman Truck Series Proposal Steve: Approximately 3 weeks ago we sent you a Sponsorship proposal for Ware Racing. We are curious if you've had the time to look our package over. We have tried unsuccessfully to reach you by phone and understand that you are very busy. If you have time would you please contact us reguarding this matter. You can reach us by phone or fax at (905) 680-1568 or on the net at dlpits@yahoo.com. We look forward to hearing from you. Thank-you Dave/Lorna Clark Allied Motorsports (representing WARE Racing) Do You Yahoo!? Yahoo! Auctions - buy the things you want at great prices http://auctions.yahoo.com/ What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EU household & industrial consumers benefit from lower electricty prices Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Enron and the Energy Services Issue Before The WTO Body:: I need you to run these items by Rick. I take full responsibility for approving the hiring of the Hills firm (and I look forward to meeting with you and Carla as we discussed) but remain hopeful we can use their services for something other than WTO. In the wake of Seattle and as I have come to understand better what the WTO can and cannot do for us on the energy services front I have come to the view that our talent and money would be better spent on other activities. My inclination is to do the bare minimum necessary to keep the machine going. If we have specifically committed to certain things then let's follow through. If there are things we can avoid let's avoid them. Specifically with respect to Fischer going to Geneva Why not have him available by phone at all hours to provide assistance and mage that known to USG instead of underwriting additional travel. With respect to the Hills firm can we use the retained time to help with the specific strategies we are now working out for the regions? These are the kinds of things we need to consider. Joe Hillings@ENRON 04/19/2000 04:13 AM To: Steven J Kean/HOU/EES@EES cc: Subject: Enron and the Energy Services Issue Before The WTO Steve: This is a brief extension of our conversation yesterday afternoon putting in print some of the upcoming dates and possible committments for your consideration and decision. We have no exit strategy at this time and in order to follow your general instructions to withdraw gradually (I'm not quite certain that is possible at this stage) you need to know the following. The April meeting at the WTO in Geneva (Committee on Specific Committments) spent considerable time discussing how energy services would be considered in the WTO GATS (General Agreement on Trade and Services) . The USTR raised the issue tabled the issue and guided the discussion. We did not send anyone to that session. As planned for several months we issued the Rachel Thompson study which is completing its basic distribution now. There has already been considerable interest in the study and I fully expect it to generate discussion in the days ahead. I have sent you the correspondence from the Japanese Ministry. Tonight I am hosting a small dinner for the top staff person for the leading Japanese business organization affiliated with the CSI organization. He raised the issue of Japan's industry feeling energy services was going too fast too soon when Ken addressed the WTO Ministerial Forum last December in Seattle. Now he has told Bob Vastine president of CSI that he was told later by his collegues that his statement was a misstatement. We'll hear more tonight. Later today the ESC Executive Committee is meeting with the DOE to discuss how they can support energy services for the USTR who has lacked technical advisers since Donna Bobbich and Russ Profozich left DOE earlier this year. DOE has appointed a group to help USTR and this is an orientation meeting held at their request. Next week I have scheduled the first ESC full meeting since January to update members (now 50 since Schlumberger joined on Friday) on developments which is essentially a report by USTR Carol Balassa who is the responsible official handling energy services. She has given a couple of us a debriefing on what happened at the WTO meeting and a request to prepare more detailed information for the May 10 meeting in Geneva where she tells us that energy services will be even more involved in the discussion. We should have Bob Fisher go to that meeting to be of assistance. This is a decision point for you. We have made some other committments which are also decision points although the Helsinki meeting on June 18th has been agreed upon based on my feelings that when I discussed it (the SCO/FSN Showcase Europe) in Houston with you and Rick you raised no objection which I took as agreeing that it should go forward. We have done this meeting annually where I have brought in someone from Enron companies to brief them and host them for dinner. These are the commercial people in the US embassies throughout Europe and the former Soviet Union. They are important points of contact for our commercial people. This year they want to have energy services in the WTO and as we would like them to exist in their territory. A few members of the ESC Executive Committee will do the former and Peter Styles the later. I have organized the dinner. Following that meeting is one that EC Trade staffer Uta Klinkers wants the ESC Executive Committee to put on in Brussels which is a joint meeting she is organizing with European energy industry representatives. This is a dialogue on energy services. The EU is an important player in the WTO and Uta who recently met with the ESC Executive Committee in Washington is quite supportive of liberalized energy services. At the EC she reports directly to Commissioner Pascal Lamy. Rick's memo this week suggested we have Peter Styles do this briefing. Peter is not an American and is not affiliated with the ESC. Therefore unless we participate Europe's energy industry is not talking with US industry. If this is what you want then I should tell Uta that we are unable to do the meeting. The last meeting is the presentation by Ken Lay at the OECD Forum 2000 on June 26 which I engineered with Doug Worth Secretary General of the BIAC (Business Industry Affairs Committee) to the OECD. This is a major world conference and Ken is addressing e-commerce and services. Doug an American and former head of the Washington IBM office wants to have Ken meet with OECD Commissioners in a smaller meeting to discuss trends for the future. I had planned to be there with Ken for the day day and a half he will be in Paris. I introduced our company to the OECD several years ago and it has become increasingly involved in issues of interest to us. Well these are the near-term items that require your fine hand if we are to proceed. A dramatic drop off at this time will have its effects and no one is likely to pick up our leadership. There is growing support for what has been accomplished and the USG plus others are now hooked on the energy services agenda. I cannot easily see an exit strategy that can do anything but cause criticism at this point. This is definately a longer term committment that I thought we had made when approval was given to hire the Hills firm. However if you want to exit other than pulling back from the Brussels meeting I think the other meetings are firm committements at this point. These are some thoughts for your consideration and decision. Joe What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Body:: FYI. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: New York with Mark Koenig. Body:: Joanie is booking a dinner in NY for this night. 9:00 shuttle to DC What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: GISB Approves Strawman 2.1 Body:: When appropriate GISB should do some kind of press release and congressional outreach so that policymakers are aware of this significant development. We have made reference to the process of turning GISB into EISB as we have discussed the reliability issue but the board vote is another reason for them to do some outreach on their own as well. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Washington DC to meet with Jefferds Body:: Lunch - still outstanding (No mci guy) 2:30- Chris Perkins Senator Jefferds office (R-VT) Senate Building Room 728 Hart Malcolm and Cynthia will attend she also invited Mike Marvin Business Council 3:30 - Rick Kessler Congressman Pallone Democrate from New Jersey 420 Cannon Malcolm can also attend 4:00 - Elise Jones Congresswoman Furse (D-OR) 316 Cannon Malcolm can go to this MCI we'll try to do on May 1st. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PGE/Commercial Support Group Meeting, 32C1 Body:: Per Geoff Roberts What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Help for Krishnarao Pinnamaneni Body:: Wade Thanks for your help. Krishna advised me of the conversation he had with you. Vince What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Jeff Skilling testifying at Murkowski workshop -- Workshop will run from 9:30 a.m. to 12:00, in room 216 of the Hart Senate Office Building. Body:: Came back with Skilling on company plane. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - AMEX - 02/02/01 Body:: nan What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Out of the office Body:: Gretchen Bates/Mitchell Rosen (shared Marketing) 800-989-4427 Jim Coffey PEx use by marketers(312)407-7835 Move Hebert meeting from 15th What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: YOUR MARCH 25 SLIDES OF SPEECH TO PUBLIC UTILITIES Conference Body:: Never mind ... I found 'em. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential Concern Body:: Valeria is looking into it. Michelle What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Rick Buy Status Body:: Rick -- I'm so sorry to hear about this but I'm glad the outlook is good. Let me know if there is anything I can do to help. From: Karen K Heathman/ENRON@enronXgate on 07/17/2001 02:38 PM To: Richard Causey/ENRON@enronXgate Andrew S Fastow/ENRON@enronXgate Ben Glisan/HOU/ECT@ECT Jeffrey McMahon/ENRON@enronXgate Raymond Bowen/ENRON@enronXgate Mark Koenig/ENRON@enronXgate Rebecca Carter/ENRON@enronXgate Mark Frevert/ENRON@enronXgate Greg Whalley/ENRON@enronXgate David W Delainey/HOU/EES@EES Steven J Kean/NA/Enron@Enron John J Lavorato/ENRON@enronXgate John Sherriff/ENRON@EUEnronXGate Stanley Horton/ENRON@enronXgate cc: Subject: Rick Buy Status Sent this out to my direct reports but I wanted you to be aware as well. Rick Buy What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Senate Staff Briefing, per Cynthia and Genevieve Murphy American Petroleum Institute 202-682-8410, fax 682-8294 Body:: Dirkson Senate Office building room 628 3:00 - 4:00. Same sort of briefing as when you did the House Staff Briefing same people will be presenting with you. Same people as last time except Ricardo Byrd of Nat'l Assoc. of Neighborhoods they'll try to find a replacement for him. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Project California Body:: I agree with Rick. I know Jose is tied up on current business but his input will be important. To date we have been relying on legal analysis of required approvals etc. That information is essential but it is as you know about 10% of the issue. The far more critical considerations are how is the government likely to react on a political level and what can we do about it. I think our government affairs people are in the best position to make these assessments. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Tax Review of California Assembly Bill No. 128 Body:: please forward to Vicky Sharp. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential (sic)...chew immediately after reading (sic). Body:: You have to love the availability of beautiful lasses for viewing. Things are interesting. Enron is moving right along and we will find out about who I am working for on Friday (our auction should be completed then). Not too much else is new. My place continues to get better (as I slowly furnish it) but Portland continues to be the little sister to Seattle. A couple new bars in town suggest she might be getting closer to puberty but definitely not the woman about town that Seattle is. Morgan told me you may no longer be with Steph? Is this true? (And I hope you are the only one reading this if it is not). If that is the case well we can see what we can do about it. As always I have no plans the next couple weekends so give me a shout (still have my cell phone at 503-887-3449) if you want to take a trip on down. Your always welcome to crash on my couch...(sorry its all I have I got rid of the futon). Hope youre doing well. Word. What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: HP -- confidential internal document Body:: This is an excellent update. Thanks for putting this together. Dale/Patrick - lets regroup on how we want to move this onward. Seems like SJ's suggestion of our spending more time with Bill Dwyer is a good one. Thanks Matt Sarah-Joy Hunter@ENRON 12/12/00 02:42 PM To: Matt Harris/Enron Communications@Enron Communications cc: Patrick Tucker/Enron Communications@Enron Communications Peter Goebel/NA/Enron@Enron Dale Clark/Enron Communications@Enron Communications Jennifer Medcalf/NA/Enron@Enron Subject: HP -- confidential internal document Matt: As GSS Business Development transitions the HP relationship for broadband to your team there are several issues I wanted to clarify in terms of how the relationship has been developed and who the contacts have been to date. Additionally I outlined the discussion points/action items from this morning's meeting you held with Jennifer Medcalf and myself. Per your request the HP presentation complete with a listing of HP's business partners was e-mailed to you this morning. HP contacts to date: Bill Lovejoy Western Gulf Area Sales Manager Houston TX #(713)-439-5587 (Gerry Cashiola's boss) Gerry Cashiola sales representative Houston TX #(713)-439-5555 (To date HP person coordinating the relationship--seeking a short term play) Greg Pyle Solution Control Manager Southeast Region Austin TX (#(512)-257-5735 (Pyle has been playing the business developer role but continues to defer leadership of the process to Gerry Cashiola) Daniel Morgridge Manager of Internet - E-Services long term alliances Austin TX #(512)-257-5736 (Interested in E-services/wireless longer term alliances) Bill Dwyer Chief Architect e-Services Solutions Cupertino CA #(408)-447-5240 (To date clearly the most knowledgeable person on HP's business propositions strong technical financial background to craft value propositions. Gerry Cashiola and Greg Pyle deferred to his judgement in the 11/16th meeting) Matt On November 10th GSS Business Development took HP through a tour of Enron's trading floor the gas control center and the peaking power plant unit center on the trading floor. This tour was one meeting amongst several held in October and November to provide HP a full overview of Enron's products and services and introduce them to appropriate contacts at Enron (EBS GSS buy side -- Peter Goebel). On November 16th GSS Business Development Patrick Tucker and Dale Clark outlined 3 possible EBS/HP focus areas -- connectivity storage and wireless. Three EBS action items were defined in that meeting: 1) HP was to provide an HP contact on connectivity (to date Gerry Cashiola has stalled on providing this). Sarah-Joy will continue to pursue this information and get a sense from Gerry Cashiola of what he means by short term opportunity. What is HP's time horizon for short term? 2) EBS and GSS/BD was to facilitate a conference call on Storage with Ravi to explore size and potential scope of opportunity (completed 12/8) 3) GSS/BD was to facilitate a conference call with Peter Goebel GSS IT Sourcing Portfolio Leader (set for 12/14) In conversations with you Jennifer Medcalf and myself this morning several decisions on forward-looking strategy with HP/EBS were confirmed: Gerry Cashiola has been unable to take control of the process. More importantly despite numerous visits to Enron in which he has had overviews of Enron's products and services met with Peter Goebel and his team on the GSS buy side and participated in an Experience Enron tour Gerry has been unable to define an HP business proposition. The coordination between Cashiola (short term initiative) Morgridge (long term 12-24 months) has remained unorganized. These initiatives need to be developed separately. Clearly the conversations with HP need to be elevated to a more senior level so EBS can work with HP decision makers who can move the relationship forward at a strategic level. As the relationship is developed at this strategic level shorter term opportunities will crop up along the way. But Gerry's short term plans will not be the focus of the EBS/HP relationship rather a by-product. To facilitate this process of elevating the relationship Jennifer Medcalf and I are following up with Bill Lovejoy and Greg Pyle. Lovejoy's boss is Dan Sytsma VP of HP's America's Central Region. In the conference call Thursday 12/14 with Peter Goebel and HP regarding wireless initiatives Peter will support the GSS/BD push for the HP/EBS initiative by reiterating the following two points: a) Enron is already an HP customer the onus is on HP to move forward on the process of building a strategic relationship (IBM and Lexmark are only some of the HP competitors who could push them out of the running) b) HP's ability to bring the right people to the table will influence HP's business relationship process with Enron Patrick Tucker and Dale Clark could build their relationship with Bill Dwyer Chief Architect e-Services Solutions (met at the meeting 11/16) in the near term. Perhaps plan a visit to Cupertino California to see Dwyer in person. We look forward to continuing close collaboration with your team on this and other opportunities. Sarah-Joy Hunter Enron Corporation Global Strategic Sourcing - Business Development #(713)-345-6541 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Distribution Body:: There is also a california update call (used to be daily now weekly). Marcia Linton (Jim Steffes' assistant) can give you the call in information and add you to the distribution list. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Merger News Articles Body:: A full list of news articles will be distributed on Monday but here is som= e of the initial coverage. Business/Financial Desk Section A Rival to Buy Enron Top Energy Trader After Financial Fall By ALEX BERENSON and ANDREW ROSS SORKIN 11/10/2001 The New York Times=20 Page 1 Column 2 c. 2001 New York Times Company=20 With its stock plunging and its finances in doubt the world's largest ener= gy trader the Enron Corporation agreed to be acquired yesterday by the ri= val Dynegy Inc. for about $9 billion in stock and the assumption of $13 bil= lion in debt.=20 The deal is an extraordinary turnabout for Enron a Houston-based company t= hat had been a driving force behind electricity deregulation nationwide. Its chairman Kenneth L. Lay a big contributor to the Republican Party pr= ovided political influence while its former chief executive Jeffrey K. Sk= illing helped create markets for the trading of electricity and natural ga= s. But last winter when California's effort to deregulate the electricity = market led to soaring power prices and rolling blackouts Enron was the sub= ject of much criticism and political anger.=20 Recent disclosures of discrepancies in Enron's financial statements and an = investigation by the Securities and Exchange Commission caused the shares t= o plunge this week to their lowest level in a decade. As other companies be= came wary of doing business with it Enron -- also facing a potential cash = squeeze -- apparently had little choice but to find a buyer and a deal was= hastily cobbled together this week.=20 For critics who had complained about Enron's market power and its dominance= the combination poses additional concerns. Dynegy's acquisition of Enron = will be reviewed by state and federal agencies led by the Justice Departme= nt and the Federal Energy Regulatory Commission. Analysts said today that t= hey expected scrutiny of the combined companies' holdings in California wh= ere Dynegy owns power-generating plants and Enron accounts for much of the = trading of natural gas -- fuel for the state's electric power plants.=20 Buying Enron at a deep discount -- it has lost $60 billion in market value = this year -- could make Dynegy the dominant trader of electricity and natur= al gas. But the agreement carries big risks as well. Along with Enron's gas= pipelines and high-technology trading floor Dynegy will take on Enron's s= ubstantial debt and a web of complex transactions that Enron has spun over = the last decade.=20 In addition to the $13 billion in debt that Enron carries on its books it = has guaranteed at least $4 billion in off-balance sheet loans and the hidd= en debt could total as much as $10 billion said Carol Coale a stock analy= st with Prudential Securities.=20 Charles L. Watson Dynegy's chairman and chief executive said yesterday th= at Dynegy could sort through Enron's tangled finances. ''We know the compan= y well'' Mr. Watson said. ''It's not like we just started fresh. I'm confi= dent that it's as solid as we thought it was.''=20 The new company will combine Enron's 25000-mile natural gas pipeline syste= m with the large number of power plants that Dynegy owns worldwide as well= as Illinois Power a Dynegy subsidiary that serves 650000 customers in Il= linois. But its most important asset will be its trading desk. It will be t= he largest energy trader in the nation trading more than twice as much pow= er and natural gas as its closest competitors.=20 Mr. Watson said the company did not expect to sell significant properties a= nd that the deal should pass regulatory scrutiny. ''There's really not a lo= t of overlap in assets'' he said.=20 Mr. Watson and Steve Bergstrom Dynegy's president will hold those positio= ns in the new company which will be called Dynegy and remain in Houston. M= r. Lay who created Enron in the mid-1980's will not have any role in the = combined company's daily operations. He has been asked to join its board bu= t has not provided an answer. ''The last three weeks haven't been a lot of = fun'' he said.=20 In a statement announcing the agreement yesterday afternoon Mr. Watson sai= d he was confident that the merger would produce a strong new company. ''En= ron is the ideal strategic partner for Dynegy'' Mr. Watson said. ''We will= keep a strong balance sheet and straightforward financial structure as key= priorities.''=20 To shore up Enron's finances Dynegy will immediately put $1.5 billion into= Enron through ChevronTexaco the giant oil company which already owns 27 = percent of Dynegy. Another billion dollars will be injected once the deal i= s completed.=20 Investors appeared comfortable yesterday that Dynegy could make the deal wo= rk. After falling $3 to $33 on Wednesday when the companies first said t= hey were in discussions Dynegy rose $5.76 on Thursday and yesterday to clo= se the week at $38.76.=20 ''On paper it works'' Ms. Coale of Prudential said. ''The combined compan= y would be the leading trader the market leader in most of their businesse= s.'' Ms. Coale who has a sell rating on Enron and a buy rating on Dynegy = said she planned to keep her buy rating on Dynegy.=20 As it works to have the deal approved Dynegy will have to persuade Enron's= traders to stay with the combined company. The pain of the stock's 90 perc= ent plunge this year will not be equally shared. Some Enron employees have = held onto their shares and seen their retirement accounts eviscerated. Mean= while Mr. Lay Mr. Skilling and other former and current executives sold h= undreds of millions of dollars in Enron stock in 2000 and this year.=20 The companies also have very different corporate cultures. Dynegy emphasize= s teamwork while Enron is more competitive said Ehud Ronn director of th= e Center for Energy Finance Education and Research at the University of Tex= as. Even before the merger was announced Enron had lost some of its employ= ees to other energy trading companies Mr. Ronn said.=20 Some investors and analysts say that the problems with Enron's finances may= extend beyond the partnerships that have been the subject of Wall Street's= scrutiny the last month. James Chanos a short-seller who has been one of = Enron's most vocal critics said there was increasing evidence that Enron's= energy trading operations were not as profitable as the company had said. = ''There appears to be a culture at Enron of aggressively booking profits an= d deferring or obscuring losses'' Mr. Chanos said.=20 On Thursday Enron said in a filing with the S.E.C that it had overstated i= ts earnings by almost $600 million over the last five years. Mr. Chanos sai= d more restatements were possible noting that the filing disclosed partner= ships had been used to hedge almost $1 billion in losses in 2000 and this y= ear. So far the losses from those partnerships remain off Enron's financia= l statements Mr. Chanos said.=20 Enron's stock had been under pressure for most of this year as the company= ran up large losses with failed efforts to expand outside its core trading= operation. In August Mr. Skilling resigned as chief executive and Mr. La= y resumed control of daily operations.=20 Still the company appeared financially sound until last month when it dis= closed that its shareholders' equity a measure of the company's value dro= pped by $1.2 billion because of deals disclosed only hazily in its financia= l statements. The announcement unnerved investors who wondered whether Enr= on had found ways to inflate its profits and move debt off its balance shee= t and led the S.E.C. to begin an investigation.=20 Mr. Lay tried to reassure investors that Enron's finances were in order and= that its businesses remained strong. But the last three weeks have brought= a series of damaging revelations about partnerships that Enron formed with= some of its top executives including its former chief financial officer = Andrew S. Fastow.=20 With questions mounting the major credit-rating agencies began to downgrad= e Enron's debt putting additional pressure on the company. If Enron's debt= rating falls below investment grade it would be forced to repay $3.3 bill= ion in loans that it had guaranteed.=20 To strengthen its balance sheet and bolster its stock Enron turned to big = investors like Warren E. Buffett in search of billions of dollars of financ= ing. When the financing did not quickly appear its stock fell further.=20 By this week some major energy traders were refusing to extend credit to E= nron worrying that the company would be unable to make good on its contrac= ts. The Mirant Corporation an Atlanta-based power plant owner and electric= ity trader sharply curtailed its trading with Enron this week. ''We're tra= ding with them on a very limited basis'' said James Peters a Mirant spoke= sman. ''It's not business as usual.''=20 On Wednesday Enron's stock fell as low as $7 a share its lowest level in = more than a decade. That day news of the Enron and Dynegy talks leaked out= .=20 By late Wednesday the boards of the two companies had tentatively agreed t= o a deal. But Dynegy refused to go ahead until it learned whether Enron's c= redit rating would remain investment grade and was comfortable with the eff= ect of the deal on its own rating. The deal moved forward yesterday after D= ynegy was assured Enron's debt was not in danger of being lowered to junk s= tatus soon after the deal was announced according to company officials.=20 Dynegy and Enron had provided Standard & Poor's and Moody's Investors Servi= ce the main credit agencies with statements showing them what a combined = company might look like and asked the ratings agencies for an expedited rev= iew of the transaction Mr. Watson said.=20 Under the deal Enron shareholders will receive 0.2685 share of Dynegy stoc= k for each Enron share or $9.80 based on Dynegy's closing price on Thursda= y. Enron's stock gained 22 cents yesterday to $8.63.=20 ''I never thought our stock price would be at this level'' Mr. Lay said ye= sterday.=20 Enron's shareholders will own only 36 percent of the combined company and = Dynegy will name at least 11 members of the company's 14-member board.=20 If the deal falls apart Enron or Dynegy will have to pay a breakup fee of = $350 million.=20 To protect Dynegy's and ChevronTexaco's cash infusion the money will go to= an Enron unit that owns the Northern Natural Gas Pipeline. If the merger i= s not completed Dynegy will have the right to buy the unit.=20 An army of bankers and lawyers advised the companies. Lehman Brothers Inc. = acted as financial adviser and Baker Botts and Akin Gump Strauss Hauer &= Feld acted as counsel for Dynegy. J. P. Morgan & Company and Salomon Smith= Barney acted as financial advisers for Enron and Vinson & Elkins and Weil= Gotshal & Manges acted as the company's counsel. Pillsbury Winthrop served= as counsel to ChevronTexaco. Chart: ''A Marriage of Strength and Weakness'' A merger of Enron and Dynegy= would bring together two of the country's biggest energy companies -- and = save Enron from potential collapse. Graph tracks the weekly closes of Enron= shares from 1999 through 2001. Top North American gas marketers SALES OF = BILLION CUBIC FEET PER DAY* Enron: 24.6 Reliant: 13.2 Duke Energy: 12.8 BP:= 12.3 Mirant: 11.8 Dynegy: 10.9 Top North American power marketers SALES O= F MILLION MEGAWATT HOURS* Enron: 212.5 American Electric Power: 134.5 Duke = Energy: 118.1 Reliant Resources: 86.1 PG&E National Energy Group: 73.2 Dyne= gy: 70.1 *Figures are for the 2nd quarter of 2001. (Sources: Bloomberg Fina= ncial Markets Simmons & Co. Natural Gas Week)(pg. C2) Dynegy Enron Merger Deal Worth Almost $25 Billion Melita Marie Garza 11/10/2001 KRTBN Knight-Ridder Tribune Business News: Chicago Tribune - Illinois=20 Copyright (C) 2001 KRTBN Knight Ridder Tribune Business News Source: World= Reporter (TM)=20 Enron Corp. the nation's biggest power trader was taken over by its small= er more conservative rival Dynegy Inc. in a merger deal valued at nearly = $25 billion company officials announced Friday.=20 The combined company will be called Dynegy Inc. and will be headed by Chuck= Watson Dynegy's chairman and chief executive. If it wins regulatory and s= hareholder approval the deal would propel Dynegy the sixth-largest U.S. p= ower trader to the No. 1 position with more than 30 percent of the market= . The Houston-based competitors are new-breed energy companies formed to cap= italize on wholesale power marketing and trading with Dynegy emphasizing i= ts own power generation capabilities.=20 Enron meanwhile has been laid low in recent weeks by soured transactions = with energy partnerships run by one of its former executives and by a serie= s of revelations about questionable accounting practices. Enron this week w= as forced to restate its earnings over the past five years -- revising them= downward by 20 percent or $586 million -- and has seen its stock price pl= unge more than 80 percent in the past three weeks.=20 Both Enron and Dynegy have extensive business dealings in Illinois one of = the first states to begin deregulating its electric power industry among o= ther things Dynegy owns Illinois Power a Downstate utility.=20 The new Dynegy would become one of the largest companies in the world with= revenues exceeding $200 billion and assets of roughly $90 billion company= officials said. By comparison ExxonMobil the nation's largest company r= eported revenues of $232.7 billion in 2000.=20 We needed to do something to strengthen our balance sheet and get the inve= stor community focused on the core energy business said Kenneth Lay Enro= n's chairman and chief executive. We looked at several alternatives this = was in the best interests of our employees and shareholders.=20 Lay said he would not have a role in running the new company but was consi= dering a request to serve on the newly combined board.=20 Watson Dynegy's chairman said the merger compact included escape clauses = for Dynegy. But I wouldn't be standing here if I expected to see that (us= ed). I really believe the value degradation in Enron had nothing to do with= their core business. We looked under the hood it is just as strong as we = thought it was.=20 Still Watson acknowledged the possibility that more problems may surface a= t Enron. I don't think anybody can absolutely unequivocally say there's no= thing (more) there he said.=20 Dynegy's stock price closed higher Friday rising $2.26 or 6.2 percent to= $38.76. Enron's stock was down 33 cents or 3.7 percent at $8.63 a share.= =20 Together the companies have natural gas sales of about 40 billion cubic fe= et per day through the third quarter of 2001 and power sales exceeding 500 = million megawatt hours through the third quarter of 2001. In addition the = new Dynegy's delivery network will include more than 22000 megawatts of ge= nerating capacity and 25000 miles of interstate pipelines. In Enron Dyneg= y is taking on a company saddled with a heavy debt load and a credit rating= that has been downgraded to near junk bond status and is under the cloud o= f a Securities and Exchange Commission investigation.=20 Under the stock for stock swap portion of the deal valued at $8.846 billio= n Dynegy is paying about $10.41 a share for the 850 million outstanding En= ron shares. Dynegy would pay .2685 shares of its stock for each share of En= ron.=20 In addition Dynegy agreed to provide $1.5 billion infusion in cash to help= stabilize its much larger competitor and assume an estimated $15 billion i= n debt.=20 Just Thursday Enron reported that its debt was an estimated $12.9 billion p= ending completion of financial statements dated Sept. 30. A day later the c= ompany's accounting of its debt jumped $2 billion.=20 Dynegy's current shareholders including Chevron Texaco Corp. will end up = owning 64 percent of the new company. Chevron Texaco said it would invest a= n additional $2.5 billion in Dynegy.=20 Enron's stockholders will own about 36 percent of the combined company's st= ock at closing which is anticipated for the third quarter of 2002.=20 In Illinois in addition to Illinois Power Dynegy owns a Chicago area elec= tricity peaker plant and is a partner with Nicor Inc. in Nicor Energy an = unregulated natural gas utility in the Chicago area.=20 Enron's subsidiary Enron Energy Services has a high-profile contract to p= rovide 60 percent of Chicago city government's electricity. It also has con= tracts to provide electricity to Quaker Oats Co. and the University of Chic= ago among others.=20 In addition to Watson other top Dynegy management will remain in place in = the new company. Steve Bergstrom president of Dynegy Inc. and Rob Doty c= hief financial officer of Dynegy Inc. will retain those positions in the c= ombined company. Enron's current president and chief operating officer Gre= g Whalley will become an executive vice president of the new Dynegy. The b= oard of directors of the combined company will be comprised of 14 members. = Dynegy's 11 designees will include three from ChevronTexaco. Enron will hav= e the right to designate a minimum of three board members. Business/Financial Desk Section C Regulators Struggle With a Marketplace Created by Enron By JEFF GERTH with RICHARD A. OPPEL Jr. 11/10/2001 The New York Times=20 Page 1 Column 2 c. 2001 New York Times Company=20 WASHINGTON Nov. 9 -- For years the Enron Corporation used its political m= uscle to build the markets in which it thrived pushing relentlessly on Cap= itol Hill and in bureaucratic backwaters to deregulate the nation's natural= gas and electricity businesses.=20 Its achievement as one Enron executive said today in creating a ''regulat= ory black hole'' fit nicely with what he called the company's ''core manage= ment philosophy which was to be the first mover into a market and to make = money in the initial chaos and lack of transparency.'' Now Wall Street's dissatisfaction with Enron's secretive ways has delivere= d the company into the arms of its much smaller Houston rival Dynegy Inc.= in a deal worth about $9 billion in stock and the assumption of $13 billio= n in debt. The combination of the two companies energy experts and lawmake= rs said today poses a novel set of challenges for regulators still struggl= ing to grasp the complexities of the marketplace that Enron invented.=20 ''We're in a supersonic-speed era of electronic trading with a horse-and-bu= ggy-era regulatory system to protect consumers'' said Representative Edwar= d J. Markey a Massachusetts Democrat who has devised legislation to close = the regulatory gap.=20 Dynegy's acquisition of Enron is expected to be reviewed by numerous state = and federal agencies led by the Justice Department the Federal Trade Comm= ission and the Federal Energy Regulatory Commission.=20 Analysts said today that sharp scrutiny would be given to the combined comp= anies' holdings in California where Dynegy owns generating plants and Enro= n controls a large part of the market for trading natural gas -- the fuel f= or a big share of the state's electric power plants.=20 ''Dynegy would now have a greater ability to take the dominant position in = gas and raise the price of electricity'' said Frank Wolak a professor of = economics at Stanford University.=20 Mr. Wolak a consultant to the Justice Department on a 1999 antitrust case = that led to limits on another merger of electricity and natural gas compani= es in Southern California said he was skeptical that regulators were up to= the task of reviewing today's deal.=20 The transaction ''is something the Department of Justice needs to look at = and they are going to have a hard time looking at'' Mr. Wolak said. ''And = it's beyond the ability of the F.E.R.C. to look at.''=20 Pat Wood -- named chairman of the federal energy commission earlier this ye= ar with the backing of Kenneth L. Lay the chairman of Enron -- acknowledge= d in an interview today that the agency had ''a long way to go'' in matchin= g the sophistication of the companies it regulates.=20 But he said that the commission had made great strides in grappling with th= e new risk management techniques pioneered by Enron Dynegy and other energ= y companies. It is hiring more experts he said adopting more restrictive = rules on how much ''market power'' one party can control and requiring more= disclosure of certain energy transactions.=20 In an interview this evening Charles L. Watson the chairman of Dynegy sa= id he did not believe that regulators reviewing the deal with Enron would r= equire the sale of any assets. ''We haven't really identified any pitfalls = that require any sort of asset divestiture'' he said. ''There's not really= any overlap.''=20 A senior executive at one of Enron's largest energy-trading rivals disagree= d. ''I don't think this deal gets through unscathed'' he said today. ''I'm= sure the Justice Department and the F.T.C. will look closely at the pretty= substantial concentration of market power these companies will have in the= energy-trading area.''=20 Enron is mainly a trader of natural gas and electricity -- indeed the bigg= est player in both those markets -- and it also owns a network of gas pipel= ines. Dynegy processes and sells natural gas and generates and sells electr= icity. Each company owns a local electric utility too: Dynegy owns Illinoi= s Power in Decatur Ill. while Enron owns Portland General Electric in Por= tland Ore. but last month announced plans to sell it to another Oregon ut= ility.=20 For a decade as it transformed itself from a gas pipeline operator into th= e nation's biggest energy trader Enron enjoyed unalloyed lobbying success = in Washington and the enthusiastic backing of Wall Street.=20 In the early months of the Bush administration Mr. Lay -- whose company wa= s one of the biggest financial backers of George W. Bush's presidential cam= paign -- played a prominent and some said unusual role in helping the Whi= te House pick nominees to the federal energy commission. Enron executives m= et with Vice President Dick Cheney whose energy task force backed many of = the deregulatory initiatives pushed by Mr. Lay.=20 Now ''the company has become a pariah'' an Enron executive said today. ''= The Bush administration doesn't want to have anything to do with us.''=20 The problems began with the energy crisis in California where Enron's outs= poken defense of deregulation even more than its electricity trading activ= ities made the company a favorite whipping boy of politicians and consumer= advocates. In the financial markets meanwhile Enron's confusing disclosu= res tolerated when its stock was soaring drew disdain as the calming of t= he energy storms in California and other parts of the country beat the shar= es down starting last spring.=20 ''Enron fell victim to their own inconsistencies on transparency'' Mr. Wol= ak said. As California officials sought to understand why energy prices had= soared out of control he said Enron's ''view was that we want everybody'= s data but if you want ours get a subpoena.''=20 Energy executives and regulators said that sort of arrogance had long marke= d Enron's attitude about government oversight.=20 Electricity sales had for decades been the job of local utility companies = operating as monopolies and selling power at regulated rates within their s= ervice areas. A few entrepreneurs led by Mr. Lay conceived a different mo= del in which power could be sold by generators or middlemen to big corporat= e users or utilities in faraway regions at whatever price the market would= bear.=20 In the early 1990's Congress -- under heavy lobbying by Enron -- passed le= gislation that began to open up electricity sales to marketers. Before long= Enron became one of the first companies to receive government approval to= sell electricity at market rates. The market for interstate sales of natur= al gas had been freed up a few years earlier and critics complained that t= raders like Enron were gleaning their profits by stoking volatility in gas = prices.=20 In the mid-1990's independent gas producers backed legislation in Congress= to allow the creation of a co-operative marketing organization which the= y hoped would have helped stabilize prices.=20 Raymond Plank the chairman of the Apache Corporation a gas producer based= in Houston said that the big gas marketing and trading companies includi= ng Enron successfully lobbied to kill the plan leaving prices as volatile= as ever.=20 ''It was a great concept'' Mr. Plank said. ''We could have headed off the = problems we have today.''=20 Enron's final lobbying success came last year. With a strong push from the = company's lobbyists Congress passed futures trading legislation that exemp= ted Internet energy trading platforms like EnronOnline the industry leader= from oversight by the Commodity Futures Trading Commission. Enron takes t= he other side of trades on its exchange. In traditional markets like the Ne= w York Mercantile Exchange which remain subject to oversight the exchange= acts as a middleman between buyers and sellers.=20 Under Mr. Watson Dynegy has been less of a pathbreaker than Enron and tho= ugh California politicians denounced it too as a profiteer during the ene= rgy crisis most analysts say it has been less aggressive than Enron in bot= h its business practices and its lobbying.=20 Indeed the rival energy-trading executive today predicted ''a huge culture= clash'' as the Houston neighbors merge. ''Blood will flow in Houston over = the integration of the trading operation'' he said.=20 But regulators may find Dynegy easier to deal with.=20 Earlier this year the federal energy commission asked for comments on whet= her it should tighten scrutiny of dealings between natural gas pipelines an= d energy-trading shops owned by the same company.=20 Enron wondered what all the bother was. ''Would stricter rules prevent real= affiliate abuse that current rules do not'' it wrote in a regulatory fili= ng ''or would they instead merely restrict the activities of some of the m= ore successful participants in the marketplace?''=20 Dynegy by contrast painted a grim picture and invited regulators to crack= down. ''Abuses abound'' it said ''because of financial windfalls diffic= ulty of detection lengthy investigations and increased complexity of the m= arket.'' =20 Report on Business: Canadian Dynegy to buy troubled rival Enron Reuter News Agency 11/10/2001 The Globe and Mail=20 Metro B4 All material Copyright (c) Bell Globemedia Publishing Inc. and its licenso= rs. All rights reserved.=20 NEW YORK -- Energy provider Dynegy Inc. agreed yesterday to acquire fast-si= nking rival Enron Corp. for $9.5-billion (U.S.) signalling the demise of a= company that just months ago was one of Wall Street's highest fliers.=20 Terms of the transaction call for Dynegy to swap 0.2685 shares of its own s= tock for each Enron share the companies said. That would value Houston-bas= ed Enron at $10.41 a share including convertible stock a premium of 21 pe= r cent over yesterday's closing price of $8.63. ChevronTexaco Corp. which owns a 27-per-cent stake in Dynegy has agreed t= o infuse $1.5-billion immediately into Enron to support it until the deal c= loses. With its market-making capabilities earnings power and proven stra= tegic approach to wholesale markets Enron is the ideal strategic partner= said Dynegy chairman and chief executive officer Chuck Watson.=20 Enron the United States' largest energy trader has been struggling to ove= rcome a plummeting stock price and credit rating in the past month followin= g disclosures of deals being investigated by the U.S. Securities and Exchan= ge Commission for possible conflict of interest. =20 Financial Desk The Nation Smaller Rival to Acquire Teetering Enron Power: Energy giant tha= t pressed for deregulation in California is on the brink of collapse. NANCY RIVERA BROOKS THOMAS S. MULLIGAN NANCY VOGEL TIMES STAFF WRITERS 11/10/2001 Los Angeles Times=20 Home Edition A-1 Copyright 2001 / The Times Mirror Company=20 Enron Corp. the once-highflying energy giant whose aggressive efforts to p= rofit from California's energy deregulation made it a target of consumer an= d political backlash on Friday agreed to be saved from possible financial = collapse through a proposed acquisition by rival Dynegy Inc.=20 The roughly $7.7-billion deal is a stunning plot twist for Houston-based En= ron which was vilified in California as it was being glorified on Wall Str= eet. In only the last month a series of disturbing financial revelations p= ushed to the edge of ruin this once-powerful company whose top executives = had lectured California on its energy foibles and who influenced the direct= ion of national energy policy. Enron muscled its way to the top of the energy heap using aggressive and i= n the end financially suspect strategies that proved its undoing.=20 Now the company that late last year had a market value of $63 billion is w= orth one-tenth that and has agreed to be swallowed by a cross-town competit= or one-quarter its size. Enron's proud and influential chairman and chief e= xecutive Kenneth L. Lay who became a focus of bitter attacks by Californi= a politicians and regulators would lose his job as would many others at E= nron.=20 Even the name would disappear. The combined company would be called Dynegy = Inc. if the deal receives all the necessary regulatory and shareholder appr= ovals.=20 California officials took no joy in Enron's fate Friday though there was p= erhaps some sense of retribution from its many critics in the state.=20 This is basically a rogue corporation said Sen. Steve Peace (D-El Cajon)= an outspoken critic of Enron for years who dealt with the company as he c= haired the committee that hammered out the legislative portion of Californi= a's landmark electricity deregulation plan in 1996. It has from the beginn= ing been a rogue corporation which answered in its mind to a higher law--a = fundamental belief that there are laws of economics that supersede the law = of the land.=20 A Failed Experiment=20 Steve Maviglio spokesman for Gov. Gray Davis said that although Enron was= never a major force in California's doomed electricity market it was outs= poken in support of deregulation.=20 In a sense their experiment was much like California's experiment--a fail= ure he said.=20 Said Harvey Rosenfield president of the Foundation for Taxpayer and Consum= er Rights in Santa Monica: Nothing could better illustrate the disaster of= deregulation than the fact that one of its biggest proponents which reape= d the reward of deregulation is suffering the consequences.=20 Enron is the world's largest energy trader handling one of four energy dea= ls in the United States through its online trading operation EnronOnline. = Since it reported a surprising third-quarter loss on Oct. 16 partly tied t= o shadowy investment vehicles Enron has endured a huge loss of investor co= nfidence which brought on a massive cash crunch and some shrinkage of its = trading business.=20 Under the deal announced Friday Dynegy invited in two weeks ago after Enr= on fell short in its efforts to line up new financing would immediately he= lp Enron by pouring $1.5 billion in cash into the company. The money would = be provided by ChevronTexaco Corp. the San Francisco oil company that owns= nearly 27% of Dynegy.=20 Enron shareholders would get 0.2685 Dynegy share for each Enron share whic= h values the company at about $7.7 billion based on Friday's stock close. D= ynegy shares surged $2.26 to close at $38.76 per share on the New York Stoc= k Exchange Enron added 22 cents to close at $8.63 per share still off 89%= year to date.=20 If the deal closes in six to nine months as the parties expect Dynegy and= ChevronTexaco would invest $1 billion additionally in the combined company= .=20 This is just a financial bonanza really for both companies said Charles = L. Watson Dynegy chairman and chief executive who will head the combined = company. Watson said the merger would immediately add to Dynegy's earnings.= =20 Even so the repercussions of Enron's fall from grace could be far-reaching= . Coming on the heels of California's energy crisis Enron's troubles may s= low the country's march toward energy deregulation which Lay and Enron cha= mpioned for years as a potential boon to consumers and the economy in gener= al.=20 But the deal announced Friday will prevent an even worse outcome energy ex= perts said: the threatened collapse of Enron which would clog up for a tim= e the business of buying and selling electricity natural gas and oil. That= could interfere with delivery of energy around the country they said.=20 This is an encouraging development for the energy industry said Stephen = Baum chairman of Sempra Energy the San Diego-based parent of Southern Cal= ifornia Gas and San Diego Gas & Electric. The Enron-Dynegy combination wil= l create a credit-worthy counter-party which will help preserve order in th= e marketplace. It also will reinforce confidence in the energy trading busi= ness going forward.=20 But some in the industry are less pleased.=20 Raymond Plank chairman of Apache Corp. a Houston-based natural gas explor= ation and development firm said he is considering a motion to the Federal = Trade Commission against the proposed merger.=20 There are issues of concentration in a combination of the largest energy t= rader Enron and the fifth-largest Dynegy Plank said. California shoul= d be particularly concerned because Dynegy owns power plants there and Enro= n has pipelines and other interests.=20 Troubles Mount as Stock Plunges=20 The swagger that was Enron is long gone. Consider:=20 * Enron's brash chief executive Jeffrey K. Skilling touted only months ag= o as one of the young stars of American business abruptly resigned in Augu= st citing personal reasons. Enron's stock already had fallen from its high= of nearly $90 per share as investments in water and telecommunications tur= ned sour a fact that contributed to Skilling's departure.=20 * The Securities and Exchange Commission has launched an investigation of E= nron's controversial dealings with a number of limited partnerships some o= rganized and run by Enron managers including Enron Chief Financial Officer= Andrew S. Fastow who was ousted last month.=20 * In an extraordinary confession Thursday Enron announced that it had over= stated profit by $586 million or 20% during the last five years. The earl= ier financial statements reported to Wall Street and the investing public = Enron said should not be relied upon.=20 * The company also fired its treasurer and a corporate lawyer both of whom= it said were investors in one of the limited partnerships. Yet some analys= ts questioned whether even in its admission of accounting trickery Enron = wasn't still holding something back.=20 * Credit-rating agencies which already have downgraded Enron's bonds to ba= rely above junk status continue to pore over Enron's books. Analysts hav= e said a further downgrade to the level of junk or below investment grade= could precipitate a crisis akin to a run on a bank and threaten Enron's su= rvival while the merger is pending.=20 With its stock crumbling and trading partners leery about its ability to pa= y its debts Enron was forced to walk hat in hand down Houston's Energy All= ey to negotiate a saving takeover by Dynegy the rival once jokingly dismis= sed as Enron Lite.=20 In the trading markets where Enron still holds a leading but increasingly v= ulnerable position other players already are stepping up to grab a bigger = share of the business. Even if Enron's trading operation survives more or l= ess intact under the wing of a Dynegy or some other company experts said = it may never regain its former level of dominance.=20 Enron has been a very innovative shop willing to spend considerably to es= tablish new markets said analyst Andre Meade of Commerzbank Securities in= New York. If that culture is not kept everyone loses.=20 Skilling and mentor Lay had worked for a decade to create both a new kind o= f company and a new set of markets for it to play.=20 In large part they succeeded. Enron transformed itself from a traditional = gas pipeline company into a high-tech global trader of everything from elec= tricity to pollution credits to aluminum. The company's overarching strateg= y was to pare its physical assets to the minimum to get the maximum profit = bang from its intellectual capital: the ranks of MBAs and PhDs that filled = its Houston trading floor.=20 Rather than maintain its own expensive gas fields and power plants--which i= t relegated to stodgy utilities and oil companies--Enron would handle every= thing by contract relying on a network of suppliers to obtain store and d= eliver the goods while the company focused on squeezing out the best price.= =20 Dynegy in contrast has invested in such energy assets including three po= wer plants in Southern California. It uses those assets to back its trading= operation which is much smaller than Enron's.=20 Enron pulled off a migration from the dirty extreme of the oil patch the= asset-intensive domain of drillers and explorers to the clean end wher= e all the deals are done on a computer screen. It also was a migration from= lower profit margins and lower risk to high margins and high risk.=20 Shannon B. Burchett chief executive of Risk Limited Corp. an energy-orien= ted strategic-management consultancy in Dallas compared Enron to the inves= tment bank Salomon Bros. where he used to work in the former PhiBro commod= ities unit.=20 Enron Burchett said embodies a Wall Street culture that happens to be in= Houston.=20 Wall Street certainly got it or thought it did.=20 Accounting Rules Pushed to the Limit=20 At Enron's zenith last year when its stock peaked near $90 a share and it = was pushing into esoteric markets for weather derivatives and fiber-optic b= andwidth Enron seemed to be a one-company wave of the future.=20 Enron's aggressiveness brainpower and willingness to back radical new idea= s with serious capital helped it acquire an aura that in some ways was its = undoing analysts said.=20 Investors accorded Enron's stock a price-to-earnings valuation that was con= sistently higher than those of its peers reflecting the view that its cutt= ing-edge business model could consistently deliver faster-growing profit th= an its competitors.=20 To keep profits arcing ever upward to justify the outsize valuation Enron = began pushing the accounting rules as hard as it pushed competitors in the = trading arena. It acknowledged as much in its statement Thursday conceding= that the operations of three of the limited partnerships should have been = consolidated with Enron's own financial statements instead of being held se= parate.=20 By raising capital and running deals through the limited partnerships Enro= n could keep large amounts of debt and certain volatile assets off its own = balance sheet while simultaneously booking profit from the partnerships' t= ransactions analyst Meade said.=20 Deals Backed by Costly Guarantees=20 One risky aspect of some of Enron's deals through the partnerships was what= Meade called a double-trigger guarantee under which Enron would pledge = a cash payout if either its bond rating fell below investment grade or its = stock declined below a certain price.=20 The guarantees must have seemed a cheap way to sweeten a deal when Enron's = stock was flying high but they came back to haunt the company later when = it had to pay cash to make good on its obligations Meade said.=20 Other energy-trading companies use similar devices but Enron carried it to= an extreme and disclosed too little detail to make the process understanda= ble to investors he said.=20 Enron's magic like that of the Internet-stock phenomenon had never been e= asy to understand in the first place. The company had a reputation among an= alysts for providing scanty financial detail and hard-to-grasp explanations= of some of its dealings.=20 But as long as the reported profit kept climbing Enron kept getting the be= nefit of the doubt.=20 M. Carol Coale a respected Houston-based analyst for Prudential Securities= ruefully recalled a time last winter when she told Enron she could find = no positive catalyst for the stock and was considering downgrading her inv= estment opinion.=20 Skilling telephoned Coale and asked her to hold off promising her that the= re was unspecified good news on the horizon that would justify her faith.= =20 I believed him Coale said last week in an interview in Houston. She held= her rating steady at that time but has since downgraded Enron to an outrig= ht sell.=20 Instead of Skilling's promised good news questions mounted during the spri= ng and Enron's stock continued a steady decline. Coale and other analysts = were troubled that a large proportion of Enron's earnings seemed to come no= t from its core trading operations but from unusual transactions involving = the company's own stock or that of affiliates.=20 In California Enron played a key role as chief cheerleader for electricity= deregulation and a key energy middleman in the state. As wholesale electri= city prices soared and the state plunged into its energy crisis late last y= ear Enron and other out-of-state electricity generators and traders became= favorite targets of California politicians and regulators who said the co= mpanies were manipulating the market and charging too much for power.=20 But significantly California was not a directly successful territory for E= nron.=20 Markets in water did not develop as Enron subsidiary Azurix envisioned. And= Enron's plans for selling electricity to retail customers were deferred ev= en as deregulation took effect in 1998 because the state's deregulation for= mulas didn't allow room for retail competition.=20 Lay complained about California frequently and met with the governor to try= to influence the state's moves to repair its energy problems. In an interv= iew in his Houston office in January--overlooking Enron's new headquarters = building which is still under construction as the company's name disappear= s--Lay said he and other Enron executives had objected to the way Californi= a regulation was set up.=20 We objected more vehemently than anyone. We opposed the concept of the poo= l he said referring to the now-defunct California Power Exchange in whi= ch most of the state's power was bought and sold in an hourly market. What= competitive market in the world has a pool? We don't buy our groceries thr= ough a centralized PX.=20 Enron also backed away from building a small power plant in California last= year when the state imposed price caps.=20 One of the loudest complaints by Davis and other California officials was t= hat generators of electricity were playing games to get higher prices.=20 They criticized Enron severely too even though it was not a major generat= or because the level of its worldwide trading operations--buying and selli= ng contracts worth billions of dollars in electric power every day--gave En= ron immense sway over pricing and supplies of electricity. They also believ= e that Enron and Lay helped play a part in the reluctance of federal regula= tors for several months to place restraints on the California marketplace.= =20 CEO's Future Role Uncertain=20 Millions of people in California businesses lost money because this rogue = company succeeded in controlling the government of the United States said= state Sen. Peace one of the architects of the state's deregulation plan.= =20 Ken Lay was a mystic Peace said. Whatever he said had to make sense bec= ause he was Ken Lay. It was hero worship.=20 Many of the people working as economists at the Federal Energy Regulatory = Commission worshiped Ken Lay. As a consequence the things Enron promoted a= nd pushed for were never challenged intellectually and otherwise.=20 Lay who has been asked to sit on the board of the combined company said F= riday that he had not yet decided whether to accept.=20 He described his time building Enron as a very long ride. It's been a very= good ride for the most part.=20 I have to say the last few weeks have not been very much fun he said.=20 *=20 Rivera Brooks reported from Los Angeles and Mulligan from Houston and New Y= ork. Times staff writer James Flanigan in Los Angeles contributed to this r= eport.=20 *=20 RELATED STORY=20 Fallen CEO: Enron's Lay is a brilliant man defeated by arrogance associate= s say. A22=20 RELATED STORY=20 Energy crisis: Power firms have seen their fortunes dim in recent months. S= unday Business C1 PHOTO: Dynegy Chairman and Chief Executive Charles L. Watson right announ= ces the merger with Enron Chairman Kenneth L. Lay. PHOTOGRAPHER: Associ= ated Press PHOTO: This is just a financial bonanza really for both compan= ies says Charles L. Watson Dynegy chairman and chief executive. PHOTO= GRAPHER: Associated Press Dynegy to buy Enron Associated Press 11/10/2001 Deseret News=20 D07 Copyright (c) 2001 Deseret News Publishing Co.=20 HOUSTON -- Energy marketer Dynegy Inc. announced Friday that it will buy it= s much larger rival the once mighty but now troubled Enron Corp. for $8 b= illion in stock. Dynegy also will assume a hefty $15 billion in Enron debt.= =20 The announcement came after Enron's stock price plummeted about 80 percent = over the past three weeks because of concerns that the company wasn't revea= ling serious financial problems to shareholders. Under the deal ChevronTexaco Corp. which owns more than a quarter of Dyne= gy would quickly provide about $1.5 billion. ChevronTexaco also would cont= ribute an additional $1 billion upon completion of the deal the companies = said.=20 With its market-making capabilities earnings power and proven strategic a= pproach to wholesale markets Enron is the ideal strategic partner for Dyne= gy Dynegy chairman and chief executive officer Chuck Watson said in annou= ncing the purchase.=20 Watson made it clear that he would not tolerate the sort of financial pract= ices that prompted explosive disclosures by Enron this week -- including an= admission that more than half a billion dollars in debt had been kept off = the company's books.=20 As a combined company we will focus on leveraging our core skill sets and= as always we will keep a strong balance sheet and straightforward financ= ial structure as key priorities Watson said.=20 Enron is the country's top buyer and seller of natural gas and the No. 1 w= holesale power marketer. The company operates a 25000-mile gas pipeline sy= stem and also markets and trades metals paper coal chemicals and fiber-= optic bandwidth.=20 Dynegy controls nearly 15000 megawatts of power generating capacity throug= h investments in power projects and sells the energy in wholesale markets = and through utilities.=20 At a news conference Watson said company officials who negotiated the deal= came away convinced that Enron was worth buying despite its recent trouble= s.=20 We looked under the hood . . . it's just as strong as it ever was Watson= said.=20 Under the terms of the deal Enron shareholders will receive .2685 Dynegy s= hare for each share of Enron common stock valuing each Enron share at $10.= 41. Enron has about 775 million common shares said spokeswoman Karen Denne= .=20 That represents a 21 percent premium above Enron's closing price of $8.63 F= riday on the New York Stock Exchange -- but still just a fraction of their = 52-week high of $84.87. Dynegy's shares climbed $2.26 or 6 percent to clo= se at $38.76 on the NYSE.=20 In after hours trading on the NYSE Enron shares shot up 15.6 percent or $= 1.35 to $9.98. Dynegy shares were unchanged.=20 Dynegy's stockholders will own approximately 64 percent of the new company= with Enron's stockholders holding the remainder.=20 The boards of both companies have unanimously approved the transaction whi= ch is expected to close next summer. The deal is expected to save the combi= ned company between $400 million and $500 million annually because of conti= nued elimination of non-core Enron holdings and lower operating costs.=20 Watson will remain as chairman and chief executive of the combined company= which will retain the Dynegy Inc. name. Steve Bergstrom will remain as pre= sident of Dynegy.=20 Enron chairman and chief executive Kenneth L. Lay will no longer have a rol= e in day-to-day management of the company but has been offered a seat on t= he combined company's board and will help shepherd the merger through.=20 I am personally committed to working with Chuck Watson Steve Bergstrom an= d their colleagues in the months ahead to accomplish the merger and to buil= d a solid foundation for future value creation Lay said.=20 Dynegy said that Greg Whalley the current president and chief operating of= ficer of Enron will become an executive vice president of the new Dynegy. = He said the merger sets the best course for Enron.=20 Few of the options we considered for our core business going forward provi= ded us with the earning potential and immediate synergies that a merger wit= h Dynegy could deliver Whalley said. Together with Enron's recently anno= unced bank commitments this cash infusion gives Enron immediate liquidity= which we believe will enable the company to maintain its investment grade = credit rating.=20 The merger was announced a day after Enron acknowledged it overstated earni= ngs by about 20 percent over the past four years and kept large amounts of = debt off its balance sheets through business partnerships now under investi= gation by the Securities and Exchange Commission.=20 Analysts said the merger rescues Enron but leaves Dynegy in uncharted terr= itory -- with the outcome of the SEC investigation completely unknown. The= re is still a shroud hanging over Enron that now moves over to Dynegy sai= d Carol Coale an analyst with Prudential Securities. Business Dynegy Enron OK $25 billion deal New company would rank among largest Melita Marie Garza Tribune staff reporter 11/10/2001 Chicago Tribune=20 North Final N 1 (Copyright 2001 by the Chicago Tribune)=20 Enron Corp. the nation's biggest power trader was taken over by its small= er more conservative rival Dynegy Inc. in a merger deal valued at nearly= $25 billion company officials announced Friday.=20 The combined company would retain the Dynegy name and would be headed by Ch= uck Watson Dynegy's chairman and chief executive. If it wins regulatory an= d shareholder approval the deal would propel Dynegy the sixth-largest U.S= . power trader to the No. 1 position with more than 30 percent of the mar= ket. The Houston-based rivals are new-breed energy companies formed to capitali= ze on wholesale power marketing and trading with Dynegy emphasizing its ow= n power generation capabilities.=20 Enron meanwhile has been laid low in recent weeks by soured transactions = with energy partnerships run by one of its former executives and by a serie= s of revelations about questionable accounting practices. Enron this week w= as forced to restate its earnings over the past five years--revising them d= ownward by 20 percent or $586 million --and has seen its stock price plung= e more than 80 percent in the past three weeks.=20 Both Enron and Dynegy have extensive business dealings in Illinois one of = the first states to begin deregulating its electric power industry among o= ther things Dynegy owns Illinois Power a downstate utility.=20 The new Dynegy would be one of the largest companies in the world with rev= enues exceeding $200 billion and assets of roughly $90 billion company off= icials said. By comparison ExxonMobil Corp. the nation's largest company= reported revenues of $232.7 billion in 2000.=20 We needed to do something to strengthen our balance sheet and get the inve= stor community focused on the core energy business said Kenneth Lay Enro= n's chairman and CEO. We looked at several alternatives this was in the b= est interests of our employees and shareholders.=20 Lay said he would not have a role in running the new company but was consid= ering a request to serve on the newly combined board.=20 Watson said the merger agreement included escape clauses for Dynegy but I= wouldn't be standing here if I expected to see that [used]. I really belie= ve the value degradation in Enron had nothing to do with their core busines= s. We looked under the hood it is just as strong as we thought it was.=20 Still Watson acknowledged the possibility that more problems may surface a= t Enron. I don't think anybody can absolutely unequivocally say there's no= thing [more] there he said.=20 Dynegy's stock price closed higher Friday rising $2.26 or 6.2 percent to= $38.76. Enron's stock was up 22 cents or 2.6 percent at $8.63 a share.= =20 Through the third quarter of 2001 the companies together have natural gas = sales of about 40 billion cubic feet per day and power sales exceeding 500 = million megawatt hours. In addition the new Dynegy's delivery network woul= d include more than 22000 megawatts of generating capacity and 25000 mile= s of interstate pipelines.=20 In Enron Dynegy is taking on a company saddled with a heavy debt load a c= redit rating that has been downgraded to near junk bond status and which is= under the cloud of a Securities and Exchange Commission investigation.=20 Big premium=20 Under the stock-for-stock-swap portion of the deal valued at $8.846 billio= n Dynegy is paying the equivalent of $10.41 a share for the 850 million ou= tstanding Enron shares a 24 percent premium. Dynegy would pay .2685 shares= of its stock for each share of Enron.=20 In addition Dynegy agreed to provide a $1.5 billion cash infusion to help = stabilize its larger competitor and to assume an estimated $15 billion in d= ebt.=20 On Thursday Enron reported that its debt was an estimated $12.9 billion pen= ding completion of financial statements dated Sept. 30. A day later the com= pany's accounting of its debt jumped $2 billion.=20 Dynegy's current shareholders including Chevron Texaco Corp. will end up = owning 64 percent of the new company. Chevron Texaco said it would invest a= n additional $2.5 billion in Dynegy.=20 Enron's stockholders would own about 36 percent of the combined company's s= tock at closing which is anticipated in the third quarter of 2002.=20 Chicago-area operations=20 In Illinois in addition to Illinois Power Dynegy owns a Chicago- area ele= ctricity peaker plant and is a partner with Nicor Inc. in Nicor Energy an = unregulated natural gas utility in the Chicago market.=20 Enron's subsidiary Enron Energy Services has a high-profile contract to p= rovide 60 percent of Chicago's city government's electricity. It also has c= ontracts to provide power to Quaker Oats Co. and the University of Chicago= among others.=20 In addition to Watson other top Dynegy management would remain in place in= the new company. President Steve Bergstrom and Rob Doty chief financial o= fficer would retain those positions in the combined company. Enron's presi= dent and chief operating officer Greg Whalley would become an executive v= ice president.=20 The board of directors of the combined company would have 14 members. Dyneg= y's 11 designees would include three from ChevronTexaco. Enron would have t= he right to designate a minimum of three board members. Financial Enron Accepts $8 Billion Buyout Offer From Dynegy Energy Giant Was Forced = to Negotiating Table After Disclosing That It Had Overstated Earnings Peter Behr Washington Post Staff Writer 11/10/2001 The Washington Post=20 FINAL E01 Copyright 2001 The Washington Post Co. All Rights Reserved=20 Embattled Enron Corp. yesterday accepted a buyout offer valued at about $8 = billion from crosstown rival Dynegy Inc. If the deal is completed it would= end Houston-based Enron's reign as the leader in the huge energy trading m= arkets that set the prices of power and natural gas in the nation.=20 Its cash dwindling and its credit rating hammered Enron was forced to the = negotiating table after its recent disclosures that its obligations to a co= mplex web of partnerships involving company officials had caused the tradin= g powerhouse to overstate its earnings and obscure its total debt obligatio= ns. Four top Enron officials have resigned or been replaced since July and= once Dynegy takes control Enron's chairman and chief executive Kenneth L= ay will also leave the company. Lay said yesterday that he had not decided= whether to accept Dynegy's offer to serve on the combined company's board. It's been a good ride for a long time Lay said in a conference call last= night. The last three weeks haven't been a whole lot of fun.=20 The final deal was announced after the close of stock trading. Enron's shar= es -- which had fallen from $33 to $8 after the disclosures -- ended the da= y slightly higher at $8.63. Dynegy's stock closed at $38.76 up $2.26.=20 Dynegy offered all stock for the Enron shares so the total value of the de= al will fluctuate with Dynegy's stock price. Dynegy also said it would assu= me about $13 billion in Enron debt bringing the total value of the transac= tion to around $21 billion.=20 Dynegy's rescue of Enron will begin with an immediate cash infusion of $1.5= billion which will be supplied by ChevronTexaco Corp. a major Dynegy sto= ckholder. ChevronTexaco will invest another $1 billion in Dynegy after the = acquisition has passed regulatory review and is completed which executives= said they expect will take six to nine months as Enron tries to unscramble= the complex partnerships that are now under investigation by the Securitie= s and Exchange Commission.=20 The takeover agreement gives Dynegy an escape clause permitting it to cance= l the purchase if Enron winds up with heavy regulatory fines or legal judgm= ents from shareholder suits tied to its handling of the partnerships.=20 Chuck Watson Dynegy's chairman and chief executive said in the conference= call that a close scrutiny over the past two weeks of Enron's financial co= ndition convinced him that the company's trading and pipeline businesses we= re solid. We looked under the hood and guess what? It looked just as stro= ng as we thought it was. Watson said he did not think more damaging disclo= sures were forthcoming from Enron.=20 Until the partnership mess Enron was the nation's dominant energy trader = and it had front-door political connections to the White House. Lay its lo= ngtime chairman raised more then $100000 for the presidential election ca= mpaign of his friend George W. Bush. Enron rode the growth of energy tradin= g markets beginning in the mid-1990s as first natural gas and then electr= ic power sales were deregulated at the wholesale level. Its revenues leaped= from $9.2 billion in 1995 to $100.8 billion last year.=20 During those heady times the Houston company could choose which questions = to answer about its dealings with related partnerships and its Byzantine bo= okkeeping.=20 It was always very difficult to get information said Louis B. Gagliardi= an analyst with John S. Herold Inc. They would always rebuff you.=20 Until this fall the muscular company seemed too big to stumble said inves= tment manager David Coxe with Harris Insight Equity Fund in Chicago.=20 Coxe bought 78000 shares of Enron at $40 a share in August after wrestlin= g with the decision for months he said. Then Jeffrey Skilling Enron's chi= ef executive and strategic mastermind unexpectedly resigned. The stock wh= ich had been as high as $90 in August 2000 pitched downward.=20 Enron seemed so indispensable to the nation's energy markets that I though= t it inconceivable it could implode Coxe said. That's how I got sucked i= n.=20 Enron's fall is classic hubris Coxe said: a Greek tragedy striking someo= ne who chose to defy the gods -- in this case the rules of the system.= =20 Among the rules that Enron now acknowledges it didn't follow were the accou= nting standards that applied to the complex partnerships it created. The pu= rpose of the partnerships Enron said was to reduce the risks of investmen= ts in Internet transmission systems and to sell power plants and other asse= ts it no longer wanted.=20 The accounting errors were described in a 20-page SEC filing Enron made Thu= rsday. The errors resulted in a $1.2 billion reduction in the value of shar= eholders' equity. The company also said it had overstated its earnings by $= 586 million since 1997.=20 Enron created partnerships that would buy major assets -- such as a power p= lant -- that Enron wanted to sell or in other cases assets such as fiber-= optic cable networks that Enron intended to run but did not want to have on= its balance sheet.=20 The partnerships had outside investors but the general partner of two of t= hem was Enron's own chief financial officer Andrew Fastow. He earned $30 m= illion in fees from managing two of the largest partnerships according to = the SEC document.=20 Enron added to the capital of these partnerships by pledging its stock or = securities convertible into stock. Some of those stock transactions should = have been counted as loans resulting in the $1.2 billion drop in sharehold= er equity Enron now says.=20 Investors are asking why Enron's auditor Arthur Andersen LLP did not insi= st that these transactions be handled that way in the first place. Enron's = SEC filing mentions but does not explain some proposed audit adjustments = over the past four years that were overruled.=20 Even though as Enron now acknowledges it created an information barrier = masking critical information and violating standard accounting rules many = financial analysts who were recommending the stock to investors were not pu= shing hard enough to punch through that barrier some analysts acknowledge.= =20 It was so complicated that everybody was afraid to raise their hands and s= ay 'I don't understand it' Gagliardi said.=20 The questions are now coming from a new committee reporting to Enron's boa= rd that will investigate how the company's financial reporting was handled= from the SEC and eventually from teams of lawyers representing aggrieve= d shareholders.=20 Lay indicated yesterday he had not been aware until recently that Enron emp= loyees other than Fastow had profited from the partnership activity. Enron = directors had approved Fastow's management of the partnerships but Fastow = quit the partnerships in July and was then replaced as chief financial offi= cer.=20 Enron this week fired Treasurer Ben Glisan and Kristina Mourdant an Enron = division lawyer who it said had invested in partnerships that were tied to= one of the major partnerships headed by Fastow. The Enron report to the SE= C describes a central role in these transactions played by Michael J. Koppe= r an associate of Fastow who left Enron in July to take over Fastow's fina= ncial interests in the partnership the company said.=20 Enron will hold a conference call next week to discuss what it has uncovere= d about outside partnership investments. http://www.washingtonpost.com Financial Desk The Nation NEWS ANALYSIS A Visionary Fallen From Grace JAMES FLANIGAN TIMES STAFF WRITER 11/10/2001 Los Angeles Times=20 Home Edition A-22 Copyright 2001 / The Times Mirror Company=20 A year ago Enron Corp. Chairman Kenneth L. Lay was on top of the energy wo= rld. As a leading fund-raiser contributor and energy advisor to the Bush a= dministration he played a key role in shaping the new president's energy p= olicy. As head of the world's largest energy trading company he had an eno= rmous influence on the price of energy in California and across the nation.= Enron's highflying stock helped him cash out $123 million in stock options= last year alone.=20 On Friday with Enron being saved from financial collapse by agreeing to be= acquired by rival Dynegy Inc. Lay's career and reputation are in shambles= . Under the merger he will be stripped of a management job. His integrity = is tattered with Enron's controversial financial dealings under federal in= vestigation. Enron investors and employees are chagrined and outraged becau= se the company's stock lost 80% of its value in recent weeks. The rapid rise and fall of Lay 58 is a story of how a brilliant man with = innovative ideas and a grand scheme to transform the world's energy markets= was overcome with arrogance associates and critics say. Under Lay Enron = stretched the limits of the law and took risks that nearly caused its finan= cial collapse they say. That in turn could have resulted in a widespread d= isruption in energy supplies.=20 Enron's behavior casts doubt on the integrity of our financial markets. It= is a very serious matter said Edward R. Muller an energy investor and f= ormer president of Edison International's Mission Energy subsidiary.=20 Nobody denies he's smart but it's a question of integrity said Raymond = Plank chief executive of Apache Corp. and an associate of Lay's in Houston= 's vibrant oil and gas industry.=20 Lay and longtime partner Jeffrey K. Skilling who served briefly as Enron's= chief executive before resigning abruptly in August rose to prominence in= the last decade through the use of innovative financial techniques designe= d to exploit a reduction in government regulation of energy.=20 Lay transformed world energy industries through his vision of new market-d= riven ways to finance natural gas and electricity production and transmissi= on.=20 The financial markets that Lay and his Enron associates created had an enor= mous effect on California's disastrous experiment in electricity deregulati= on. Critics say his influence was excessive and misguided.=20 Ken Lay was a mystic said state Sen. Steve Peace (D-El Cajon) an outspo= ken critic of Enron. Whatever he said had to make sense because he was Ken= Lay. It was hero worship. Many of the people working as economists at the = Federal Energy Regulatory Commission worshiped Ken Lay. As a consequence t= he things Enron promoted and pushed for were never challenged intellectual= ly and otherwise.=20 Lay who has a doctorate in economics had modest beginnings as the son of = a poor country preacher who did farm labor on the side to raise money for h= is children's education. In the Navy in the late 1960s Lay was assigned to= the Defense Department because of his economic acumen. He allocated Penta= gon dollars more efficiently in purchasing for the military said Mark Pal= mer chief spokesman for Enron.=20 Lay worked for Exxon and other energy firms in the 1970s amid soaring oil = prices gasoline shortages and still-regulated natural gas. He headed Houst= on Natural Gas a predecessor firm of Enron in the 1980s as falling prices= for oil and natural gas presented grave problems for Houston's energy indu= stries.=20 When the federal government allowed pipelines to carry the gas of any produ= cer Lay turned Enron into a foremost firm in the new deregulated industry= . Still Enron almost went bankrupt in the late 1980s with natural gas in = oversupply and prices falling.=20 It was then that Skilling a McKinsey & Co. consultant suggested to Lay th= at the firm trade long-term contracts for gas promising to deliver the com= modity to customers at fixed prices buying and selling contracts of varyin= g maturities the way mortgage companies deal with mortgages in Skilling'= s words.=20 The innovation started Enron's rapid growth and rise to prominence as the e= mbodiment of a new kind of energy company. In the 1990s the federal govern= ment called for deregulation of electricity.=20 Lay saw opportunities. He and Skilling created a market for contracts in el= ectricity in 1994 and by 1996 Enron was the world's leading firm doing suc= h business.=20 Lay's central idea was that by creating a market of millions of buyers and= sellers constantly taking positions power supplies could be allocated eff= iciently and prices lowered. Lay liked to lecture in an avuncular way abo= ut the new economics of energy trading.=20 Technology is changing and there's a lot more value in flexibility and op= tionality. Just about in every industry you can make them a lot more effic= ient when you have more optionality Lay said in an interview in January i= n his Houston offices overlooking the sparkling new Enron headquarters buil= ding which still is under construction.=20 As Enron's business profile grew so did Lay's political influence. He serv= ed as an energy advisor to both Bush administrations and headed Texas fund-= raising for George W. Bush's presidential campaign. Lay raised $100000 for= the Bush-Cheney campaign and with his wife Linda Lay contributed anothe= r $100000 to help finance the inaugural gala this year.=20 As the administration prepared its energy plan Lay gained national stature= as a preacher of market economics applied to electricity.=20 There's no way you can centralize a command-control environment and make t= he best decisions to have an efficient low-cost reliable electricity indu= stry Lay said.=20 His sermon was intended for California which suffered sharply higher price= s for electricity last winter to the point that private utilities fell int= o or near bankruptcy and the state budget incurred a cost of $12 billion w= hich Sacramento now is trying to recover through the sale of revenue bonds.= =20 Because Enron trading billions of dollars a day in power contracts worldwi= de had an immense effect on electricity prices Lay's preaching grated on = state officials. Driven to intemperance state Atty. Gen. Bill Lockyer said= in May that he'd like to escort Lay to a prison cell.=20 But more than economic philosophy was behind Lay's goading of California. T= he state's debacle gave energy deregulation a bad name and chilled deregula= tion moves by many other states.=20 That in turn reduced growth prospects for Enron. The promise of continued g= rowth in deregulation had helped make Enron a Wall Street darling. Its stoc= k price at one point nearly $90 a share versus less than $10 now pushed u= p the value of Enron stock options held by almost all employees but owned = in great amounts by Lay Skilling and other company officers.=20 Lay cashed in last year converting options for a gain of $123 million whi= le Skilling gained $62 million by converting his options. As they cashed in= Enron was encountering other problems. Attempts to set up trading markets= in water and broadband Internet transmission were floundering. A major pow= er plant venture in India was in grave economic and political trouble.=20 But in the last month Enron revealed that it had reduced the firm's equity= value by more than $1 billion due to write-offs in a hitherto hidden partn= ership.=20 Revelations then cascaded. The firm had 33 such partnerships which had bil= lions of dollars in debt for which Enron was liable. Lay and Skilling piled= up debt in hidden partnerships analysts explain because the firm needed = huge amounts of debt to support its greatly expanding levels of trading in = electricity natural gas and other commodities.=20 But the firm could not support such debt and still retain its credit rating= growth rate and high stock price. After weeks of gamely protesting that t= he business was sound and that he personally took offense at investment ana= lysts' suggestions of impropriety Lay fell silent.=20 *=20 Times staff writer Nancy Vogel in Sacramento contributed to this report. PHOTO: With the takeover of his once-soaring firm Enron chief Kenneth Lay'= s career is in tatters. PHOTOGRAPHER: Reuters Business Struggling Enron agrees to takeover by smaller rival Dynegy One-time energy= giant and Southern Co. often scrapped over access to markets MATTHEW C. QUINN STAFF 11/10/2001 The Atlanta Journal - Constitution=20 Home F.1 (Copyright The Atlanta Journal and Constitution - 2001)=20 Energy giant Enron Corp. capitulated to a mounting financial crisis Friday = and agreed to be taken over by a smaller competitor. But Atlanta-based Sout= hern Co. was not gloating at the misfortunes of its vanquished rival.=20 It wasn't easy. For years the two companies were locked in a struggle over access to elect= ricity markets. Enron pushed for competition and deregulation while Southe= rn resisted to protect its dominance in the fast-growing Southeast.=20 Sometimes the battle got nasty.=20 If Thomas Alva Edison came back from the dead and called Southern Co. to g= et some electricity he'd find that nothing has changed Jeffrey Skilling= then Enron's president said in November 1997. These guys are living in a= n industry that was created 100 years ago and they want to keep it that wa= y.=20 Fast forward four years.=20 Southern Co. has split itself in two retaining its regulated Southeastern = utility business and spinning off its own unregulated power generation and = energy trading arm Mirant Corp. Southern reported net income of $1 billion= for the first nine months of this year and Mirant's profits were $538 mil= lion. Southern's shares are up 19 percent this year. Mirant's have declined= 7 percent.=20 Enron on the other hand lost 90 percent of its stock market value this ye= ar alone and this past week restated earnings for the past 4 1/2 years red= ucing profit by more than $500 million.=20 Skilling was named chief executive in February but abruptly resigned after = six months. This week he was subpoenaed to testify in a Securities and Exch= ange Commission probe of the Texas company's questionable relationships wit= h outside partnerships.=20 Houston-based Dynegy Corp. a crosstown rival said late Friday it will buy= Enron --- once valued at $69 billion --- for $7.8 billion in stock.=20 Enron will be wrapped into a new Dynegy managed by top Dynegy executives.= That suggested even the name Enron --- synonymous with innovation in recen= t years in the utility industry --- will go by the wayside.=20 Southern spokesman Todd Terrell declined to comment earlier in the day on E= nron's problems.=20 A.W. Bill' Dahlberg who retired as Southern's chief executive in April an= d is now Mirant's board chairman said he regretted Enron's troubles.=20 They were a rival and got credit for doing a lot of innovative things in o= ur industry Dahlberg said. You always like to win the competition becaus= e you do well not because somebody else does badly.=20 Enron was a pioneer in the wholesale trading of electricity and natural gas= and has been widely imitated from Mirant's sprawling energy trading floo= r at Perimeter Center to an energy management subsidiary launched this year= by AGL Resources parent of Atlanta Gas Light Co.=20 As the largest U.S. energy trading firm Enron's tentacles run deep. It was= active at the Public Service Commission in 1998 when rules for Georgia's n= atural gas deregulation were written only to opt out of becoming a gas mar= keter itself. But New Power Co. which is 45 percent owned by Enron became= Georgia's newest marketer this year.=20 A Dynegy-Enron combination will create a $200 billion-a-year enterprise tha= t will dwarf Mirant in both the electricity and natural gas sectors.=20 Dynegy and Mirant are considered more stable than was Enron because they re= ly more on their own power plants for electricity and less on trading for p= ower produced by others. And Dynegy is no stranger to Georgia. It is a mino= rity partner with AGL Resources in Georgia Natural Gas Services the state'= s No. 1 gas marketer.=20 But the partners have been at odds for months.=20 AGL sued Dynegy in July alleging it earned millions of dollars at the exp= ense of the marketing company that it supplies with natural gas.=20 Dynegy's counterclaim accused AGL among other things of scheming to shift= the partnership's gas supply deal to AGL's own subsidiary Houston-based S= equent Energy Management.=20 Dynegy in May started up a 500 megawatt natural gas-fired power plant in He= ard County despite opposition from nearby residents. Dynegy is also a major= buyer of electricity produced at Southern Co.'s new power plant in Jackson= County.=20 They're a big customer a partner and a competitor --- all of those things= said Southern's Terrell. Graphic POWER POWERHOUSE A merger of Enron Corp. and Dynegy Corp. would cre= ate an energy powerhouse. Atlanta-based Mirant Corp. would be far behind b= ased on second-quarter figures. Top 20 North American Gas Marketers 2nd qu= arter 2001 Billions of cubic feet a day 1..= .Enron...................... 24.6 13.2 3...= Duke Energy................ 12.8 5...M= 7...Aq= uila Energy.............. 10.3 9...El = Paso......................9.2 10. American Electric Power......8.5 ........= ................ Top 10 North American Power Marketers 2nd quarter 2001 Co= of megawatt hours 1...Enron..........= ............212.5 2...American Electric Power....134.5 3...Duke Energy.....= ...........118.1 4...Reliant Resources.......... 86.1 5...PG&E National Ene= rgy Grp... 73.2 7...Mirant............= ..........69.7 9. Williams............= ........ 63.4 10. Exelon Power Team.......... 52.5 Source: Natural Gas Week BUSINESS Dynegy to Acquire Troubled Enron / Energy giants in $7.8B stock deal COMBINED NEWS SERVICES 11/10/2001 Newsday=20 ALL EDITIONS A16 (Copyright Newsday Inc. 2001)=20 Houston - Energy marketer Dynegy Inc. announced Friday it will buy much lar= ger rival Enron Corp. for $7.8 billion in stock.=20 The announcement came after Enron's stock plummeted about 80 percent in the= past three weeks over concerns that the company wasn't revealing serious f= inancial problems to shareholders. Dynegy is taking out a competitor acquiring some attractive assets and t= hey're doing it at an incredible price said Joseph Correnti an analyst a= t Wayne Hummer Investments.=20 The two Houston-based companies began negotiations a week ago as it became = apparent Enron needed cash to stay in business. Dynegy which is 26-percent= owned by ChevronTexaco Corp. agreed to the deal after Moody's Investors S= ervice maintained an investment-grade rating on Enron eliminating a stumbl= ing block in negotiations.=20 The combined company will have annual revenue of more than $200 billion ra= nking it as one of the nation's 10 largest. It will have more than 22000 m= egawatts of electric generating capacity and 25000 miles of natural gas pi= peline.=20 On Thursday Enron acknowledged it overstated earnings by about 20 percent = over the past four years and kept large amounts of debt off its balance she= et through business partnerships now under investigation by the Securities = and Exchange Commission. Enron said financial statements from 1997 through = the first half of 2001 should not be relied upon.=20 Revised statements reduced Enron's profits for those years by $586 million = and increased its debt by $628 million.=20 During its recent turmoil Enron fired chief financial officer Andrew Fasto= w who ran some of the partnerships under investigation by the SEC.=20 Dynegy chief executive Charles Watson will head the combined company.=20 The terms of the deal value each Enron share at $10.41 based on Friday's c= losing stock prices. That represents a 21-percent premium above Enron's clo= sing price of $8.63. Dynegy's shares closed at $38.76 up 6 percent.=20 It was not immediately clear what role Enron chairman and chief executive K= enneth L. Lay would have in the new company.=20 While Watson has led a diversified company that put as much emphasis on bui= lding power plants as on energy trading Lay focused on the wholesale tradi= ng of natural gas and electricity. He had expanded Enron in the 1980s from = a natural gas pipeline into the most formidable competitor in the business = of energy trading which was created by deregulation of energy markets in t= he United States and Europe. Dynegy announces $8 billion deal to buy larger rival Enron By JUAN A. LOZANO Associated Press Writer 11/09/2001 Associated Press Newswires=20 Copyright 2001. The Associated Press. All Rights Reserved.=20 HOUSTON (AP) - Energy marketer Dynegy Inc. announced Friday that it will bu= y its much larger rival the once mighty but now troubled Enron Corp. for = $8 billion in stock. Dynegy also will assume a hefty $15 billion in Enron d= ebt.=20 The announcement came after Enron's stock price plummeted about 80 percent = over the past three weeks because of concerns that the company wasn't revea= ling serious financial problems to shareholders. Under the deal ChevronTexaco Corp. which owns more than a quarter of Dyne= gy would quickly provide about $1.5 billion. ChevronTexaco also would cont= ribute an additional $1 billion upon completion of the deal the companies = said.=20 With its market-making capabilities earnings power and proven strategic a= pproach to wholesale markets Enron is the ideal strategic partner for Dyne= gy Dynegy chairman and chief executive officer Chuck Watson said in annou= ncing the purchase.=20 Watson made it clear that he would not tolerate the sort of financial pract= ices that prompted explosive disclosures by Enron this week - including an = admission that more than half a billion dollars in debt had been kept off t= he company's books.=20 As a combined company we will focus on leveraging our core skill sets and= as always we will keep a strong balance sheet and straightforward financ= ial structure as key priorities Watson said.=20 Enron is the country's top buyer and seller of natural gas and the No. 1 w= holesale power marketer. The company operates a 25000-mile gas pipeline sy= stem and also markets and trades metals paper coal chemicals and fiber= -optic bandwidth.=20 Dynegy controls nearly 15000 megawatts of power generating capacity throug= h investments in power projects and sells the energy in wholesale markets = and through utilities.=20 At a news conference Watson said company officials who negotiated the deal= came away convinced that Enron was worth buying despite its recent trouble= s.=20 We looked under the hood and guess what it's just as strong as we though= t it was Watson said.=20 Under the terms of the deal Enron shareholders will receive .2685 Dynegy s= hare for each share of Enron common stock valuing each Enron share at $10.= 41. Enron has about 775 million common shares said spokeswoman Karen Denne= .=20 That represents a 21 percent premium above Enron's closing price of $8.63 F= riday on the New York Stock Exchange - but still just a fraction of their 5= 2-week high of $84.87. Dynegy's shares climbed $2.26 or 6 percent to clos= e at $38.76 on the NYSE.=20 In after hours trading on the NYSE Enron shares shot up 15.6 percent or $= 1.35 to $9.98. Dynegy shares were unchanged.=20 Dynegy's stockholders will own approximately 64 percent of the new company= with Enron's stockholders holding the remainder.=20 The boards of both companies have unanimously approved the transaction whi= ch is expected to close next summer. The deal is expected to save the combi= ned company between $400 and $500 million annually because of continued eli= mination of non-core Enron holdings and lower operating costs. Watson sai= d it was too soon to say if the deal would result in job cuts. Enron has ab= out 20000 employees while Dynegy's work force is about 6000.=20 Watson will remain as chairman and chief executive of the combined company= which will retain the Dynegy Inc. name. Dynegy's Steve Bergstrom will cont= inue as president.=20 Enron chairman and chief executive Kenneth L. Lay will no longer have a rol= e in day-to-day management of the company but has been offered a seat on t= he combined company's board and will help shepherd the merger through.=20 Dynegy said that Greg Whalley the current president and chief operating of= ficer of Enron will become an executive vice president of the new Dynegy. = He said the merger sets the best course for Enron.=20 Few of the options we considered for our core business going forward provi= ded us with the earning potential and immediate synergies that a merger wit= h Dynegy could deliver Whalley said. Together with Enron's recently anno= unced bank commitments this cash infusion gives Enron immediate liquidity= which we believe will enable the company to maintain its investment grade = credit rating.=20 The merger was announced a day after Enron acknowledged it overstated earni= ngs by about 20 percent over the past four years and kept large amounts of = debt off its balance sheets through business partnerships now under investi= gation by the Securities and Exchange Commission.=20 Analysts said the merger rescues Enron but leaves Dynegy in uncharted terr= itory - with the outcome of the SEC investigation completely unknown. Ther= e is still a shroud hanging over Enron that now moves over to Dynegy said= Carol Coale an analyst with Prudential Securities.=20 Early Friday Moody's Investors Service downgraded Enron's debt ratings to = one level above junk bond status and said the company's long-term debt rati= ngs remain under review for further downgrade.=20 In an SEC filing Enron said financial statements from 1997 through the fir= st half of 2001 should not be relied upon and that outside businesses run= by Enron officials during that period should have been included in the com= pany's earnings reports.=20 The revised statements reduced Enron's profits for those years by $586 mill= ion from $2.89 billion to $2.31 billion. The revisions also increased the = company's debt each of the four years reaching $10.86 billion - $628 milli= on more than previously reported - by the end of 2000.=20 Keeping the debt off its balance sheets likely ensured Enron could maintain= a strong credit rating to support expansion of its core businesses - whole= sale trading of natural gas and electricity.=20 But the company's stock price started dropping 10 months ago when its high-= speed Internet unit foundered and Enron had trouble collecting money from p= ower customers in India.=20 The stock price began to free fall after Enron announced a $618 million thi= rd quarter loss and news of the SEC investigation surfaced.=20 Enron responded by firing its chief financial officer and scrambled to get = cash and increase credit lines in an attempt to regain investor confidence= but investors dumped Enron shares and sent its stock plummeting.=20 The ousted chief financial officer Andrew Fastow ran some of the partners= hips under investigation by the SEC.=20 Jeff Skilling Enron's former chief executive who left in August has been = called to testify before the SEC although it's unclear when.=20 ---=20 On the Net:=20 http://www.enron.com=20 http://www.dynegy.com AP Graphic DYNEGY ENRON Copyright ? 2000 Dow Jones & Company Inc. All Rights Reserved. =20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Telephone Interview with The Enron Corp. Research Group Body:: Since several of you will be out on the 6th we have moved the telephone interview for Marshall Yan to Tuesday the 5th at 1:00 pm. Thanks! Shirley ----------------- What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Monthly Billing - Detail Class 845 / s100105.xls Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Memo For Thursday Meeting Body:: Richard and Elizabeth At Christian's suggestion I am sending a memo I prepared summarizing some of the more exotic strategies used by our traders. Christian has reviewed the memorandum and believes that it will assist you both in preparing for our Thursday meeting. Between now and Thursday Christian and I are going to analyze the ISO tariff to determine if the tariff prohibits any of these strategies. Steve What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: SDG&E Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CA Supply Realities Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Project Power Play meeting, in Causeys office, EB 5015. With Rick Causey, Kathleen Magruder, Jordan Mintz, Bob Hermann Body:: Per Bobbie Moody x35955 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: See natural gas price article below. Our buddy Paul Carpenter has turned o= n=20 us (not to mention that he seems to be talking nonsense). How about giving= =20 him a call? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Memo For Thursday Meeting Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: SPEC SR PUBLIC RELATIONS, Job Code #0000109017 Body:: Molly Do you know who has posted this ad: SPEC SR PUBLIC RELATIONS Job Code #0000109017. I have a friend who is looking for a position who seems to have the perfect skills for this job. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Thank You Body:: Tim I enjoyed meeting with you too. As I mentioned I thought your answers were thoughtful well stated and accurate. In our line of work it helps to triangulate using others' insights and I found yours particularly useful. Richards Tim J (CORP) on 08/02/2000 09:01:46 AM To: 'rshapiro@enron.com' 'skean@enron.com' cc: 'Kelshaw Lisbeth' Subject: Thank You Dear Steve and Rick Thank you very much for inviting me to Houston yesterday to discuss Enron's Federal Government Affairs position. Your vision of the role for the Enron Washington office fits closely with my views on what a best-in-class Washington operation should offer and it was helpful to learn more about Enron and its business units. Enron is clearly an exciting place to work and the fact that public policy is so vital to the company's future makes the Washington position particularly attractive. It was a real pleasure to meet you yesterday and I look forward to hearing from you again. Sincerely Tim Richards Timothy J. Richards GE International Law & Policy 1299 Pennsylvania Avenue NW 1100W Washington DC 20004 Phone: 202-637-4407 Home: 202-882-3385 Fax: 202-637-4300 What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Schoenemann Resume Body:: Molly Thanks. I am in London this week but I can pick up my messages from here. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Important - CPUC Motion - Confidential Attorney Client Privil ege and Work Product Body:: I just spoke with Mary to make sure we have the same information. Here are the facts we have so far. On November 4th the CPUC filed a motion with FERC to adopt the form of protective order that the CPUC entered to compel the production of documents and to shorten time to answer. According to Exhibit B (read to me by Nancy Pickover at Bracewell) the following CPUC moved against the following entities: AES Williams Duke Dynegy Reliant and Southern. Enron entities were NOT named in exhibit B. This is not to say that we could not be easily added to the group. While the motion reads as if the CPUC was moving against everybody in fact in footnote 2 they state they are only moving against the entities named in Exhibit B. We will have Exhibit B in hand first thing tomorrow via FEDEX to confirm this. To repeat Enron is not named yet. Thanks Gary What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Meeting Request - July 25th Body:: Yes. Maureen - please schedule. From: Michael on 07/06/2001 03:05 AM GDT To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron=20 Subject: Meeting Request - July 25th Steve -=20 I=01ll be in Houston July 23-26 and would like to get together to bring yo= u up=20 to date on the latest developments in Japan regarding EBS and EGM as well= =20 as=01 energy markets.=01 Would you=01 have half an hour on the morning o= f Wednesday=20 the 25th? Thanks Mike What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Wabash Valley called re: AEP filing Body:: let's bring him in Christi L Nicolay@ECT 10/02/2000 12:29 PM To: James D Steffes/NA/Enron@Enron Jeff Brown/NA/Enron@Enron Janine Migden/DUB/EES@EES Joe Hartsoe/Corp/Enron@Enron Sarah Novosel/Corp/Enron@Enron Donna Fulton/Corp/Enron@ENRON Richard Shapiro/HOU/EES@EES Kerry Stroup/DUB/EES@EES Steven J Kean/NA/Enron@Enron cc: Subject: Wabash Valley called re: AEP filing Don Morton general counsel of Wabash Valley Power Association a co-op in AEP's area called me about Enron's protest of AEP's market based rates filing. Wabash has filed an appeal in the DC Circuit of AEP/CSW merger (its brief is due 11/20). He thinks FERC is out of control and not carrying on its duties. Wabash is also preparing a protest of the Alliance compliance filing (due this Friday 10/6) on the following grounds: Filing is really a continuation of pancaking Does not want FERC to approve on a conditional basis (expecting Alliance to be a true RTO)--Wabash thinks that Alliance simply creates a larger profit center for AEP's transmission system Mr. Morton also had some specific OASIS problem examples that happened to Wabash that involved preferential treatment for AEP. I told him to call or email Scott Miller for the investigation. Mr. Morton and Wabash CEO Ed Martin would like to come to Houston to visit with Enron about our concerns and about the possibility of making some joint filings. His number is 317-481-2815. Please let me know if I should set something up or if someone else would like to talk with him directly. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Privileged and Confidential -- Performance Bonus Language Body:: David You asked me to provide my opinion about the employment agreement provisions relating to target bonus amounts that are based on performance. The bonus language contained in the majority of the agreements with a target bonus is as follows: Provided that Enron meets its earnings targets and provided that Employee is rated within the top 25% of the performance criteria under Enron's annual performance rating system or its equivalent for the calendar year in question Employee's annual bonus amounts under the Plan for calendar years 2001 2002 and 2003 (payable in 2002 2003 and 2004 respectively) shall be based on an annual bonus target of $_____________. This language does not address a person's performance as compared to one's peers but instead looks at the number of performance criteria and requires that a person be in the top 25% of those criteria. Thus if there are only 3 rating categories (i.e. 1 2 3 distributed as 10-80-10) then only the people in the top category would be within the top 25/33% of the rating criteria. Given the huge change in our process however there is an argument that the above language cannot be applied to the current scheme and that instead we should look at the top 25% of the peer group instead of performance criteria even though that was not the intent of the provision when it was drafted. As a result I would suggest that the middle category be divided further into either 2 or 3 subcategories (i.e. 2A 2B or 2C). That way persons who fall out in categories 1 or 2A would be eligible for the target bonus. If there is a decision not to break down the middle 80 further then it would be useful to look at those employees with a bonus target that we think is too high. For those employees a more conservative approach may be to evaluate them on a scale that is more subdivided than the 10-80-10 breakdown and to document that they fell out in the bottom 75% of the categories under that process. Of course it goes without saying that we should ensure consistent treatment based on race sex national origin age etc. in this process. Please let me know if you have any questions. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Boise -- Body:: You speak at 10:05 a.m. Boise time DOE conference call at 3:00 p.m. Eastern time 1:00 Boise time. Paul Carrier will follow up with details. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: Yes From: Jeff Dasovich on 04/19/2001 03:45 PM Sent by: Jeff Dasovich To: Steven J Kean/NA/Enron@Enron cc: Subject: Re: Make sense for me to attend the meeting? Steven J Kean 04/19/2001 12:31 PM To: Jeff Dasovich/NA/Enron@Enron Susan M Landwehr/NA/Enron@Enron cc: Richard Shapiro/NA/Enron@Enron James D Steffes/NA/Enron@Enron Rosalee Fleming/Corp/Enron@ENRON Sandra McCubbin/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Paul Kaufman/PDX/ECT@ECT Subject: I got a voicemail fro Ken. He would be happy to meet with Freeman. He is willing to work on other times but suggested the following After 3:00 on May 2nd (right after Ken's speech to the RGA) or late the day before or in the morning of the second (to do this though he would have to cancel his speech to the Texas Governor's business council but he is willing to do this if necessary) His least preferred alternative in this general time frame would be early morning on the third. Jeff -- could you coordinate with Rosie to get the time and place nailed down? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: California Amendments DEFEATED! Body:: Congrats Linda Robertson 07/19/2001 09:44 AM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron James D Steffes/NA/Enron@Enron mark s palmer/enron@enronXgate@Enron cc: Subject: California Amendments DEFEATED! John Shelk will provide a more thorough report in a later Email but I just wanted you to know that the Waxman price cap amendment was just defeated in full Committee markup and the Eshoo refund amendment was defeated. Both by sizable margins. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Last FINAL version Body:: Has this gone to Ken yet. If not please send. Maureen McVicker 06/21/2001 02:55 PM To: Lora Sullivan/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Jeff Dasovich/NA/Enron@Enron cc: Subject: Last FINAL version Lora: This is the new Final version. The difference from the earlier version is - a few slides were taken out and the order of the remaining slides were rearranged. Please get a copy of this new Final to Ken Lay. Thanks. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: BABC-Houston Newsletter Body:: Please handle ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: WeatherNet Body:: I think this is a very interesting idea. Please get with Bill D. and make sure he gets a description of what we would need to do to physically accomodate the station and make sure he's comfortable with it before we go ahead. Laura Schwartz 03/05/2001 12:52 PM To: Cindy Olson/Corp/Enron@ENRON cc: Steven J Kean/NA/Enron@Enron Karen Denne/Corp/Enron@ENRON Elyse Kalmans/Corp/Enron@ENRON Subject: WeatherNet As part of our agreement with the Channel 2 WeatherNet program we were given the option to have a weather station at the Enron building. This would be an additional $5000 on top of our commitment. I brought the idea to Gary Taylor and Todd Kimberlain in weather and they thought it would be a great idea to serve as the weather tracking spot in downtown Houston. They have agreed to pay the $5K for the equipment and installation. So now in addition to Channel 2 mentioning WetherNet brought to you by Enron everytime they talk about the weather in downtown Houston they will mention the current temp. at the Enron building. If you have any questions please call me at ext. 34535. Laura What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: NAES/ Regulatory Meeting in 29C2. Body:: Joe Hartsoe to handle. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Revised DeLay op ed Body:: I've made some changes (shown in bold). Bracketed text indicates a deletion . Jeannie Mandelker@ECT 08/18/2000 05:34 PM To: Steven J Kean/NA/Enron@Enron Cynthia Sandherr/Corp/Enron@ENRON Richard Shapiro/HOU/EES@EES Jeff Dasovich/SFO/EES@EES cc: Mark Palmer/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON Subject: Revised DeLay op ed Steve -- great guidance. Cynthia -- hope we're in time. Jeff -- the fifth paragraph has some supply/demand figures for the early part of this week that I heard but can't track down the written source. Any suggestions? Please review and don't hesitate to call me this weekend. Best bet is home number -- 914-736-9504 or cell phone -- 914-318-1568. Jeannie What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Energy Services: With Dereg Under Fire,Enron Calif Elec Business Heats Up Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: I would like to nominate Dr. Stig Faltinsen from Enron Europe as my guest at the London Understanding and Applying Financial Mathematics to Energy Derivatives conference London June 28-29. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - Mid Year Overview Body:: Please review the attachment and let me know if you have any changes. The final document will provide a starting place for the year end review process. What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Jim Bannantine on eSpeak - March 23 Body:: Kelly raised this concern too. The system is set up so that questions do not appear unless we let them -- i.e. we can screen questions and answer only those we choose. Even with that feature though I think we should skip this one (or just reschedule for a later date). I'll contact Jim by separate e-mail. J Mark Metts@ENRON 03/21/2000 04:29 AM To: Steven J Kean/HOU/EES@EES cc: Subject: FW: Jim Bannantine on eSpeak - March 23 Can we get this killed or redirected? This seems very dangerous. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: CONFIDENTIAL Personnel issue Body:: just a reminder we already have on line training re sex harassment. i'll take a look at all. --Lizzette What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Power Crisis Update (No. 10) Body:: We have been pulling together these weekly(sometimes more often) summaries for internal purposes. Would you find it helpful to be on the distribution list? Hope you are doing well. Look forward to touching base soon. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Two Requests re: May 22-23 Forum Body:: I will need an LCD projector and a computer (or connections for my computer) so that I can show the presentation. Thanks. Heidi VanGenderen on 04/24/2001 04:16:43 PM Please respond to To: cc: Subject: Two Requests re: May 22-23 Forum Greetings: Thank you for joining us for the May 22-23 2001 Forum on Securing the Energy Future of the Western United States here in Denver. If you require any audio visual aids for your presentations (overhead projector LCD etc.) please respond to this e-mail ASAP. Please remember that you will be asked to remain within the time limits outlined in the memo to speakers/discussants from Marshall Kaplan and David Olsen. We are compiling a series of articles on western state power problems and possible options to overcome problems for distribution to all Forum participants. We welcome your submission of any recent article or articles or their citations and/or web page references that you have found interesting and useful. These might address subjects such as power challenges alternate policies with respect to supply and demand management financing power related infrastructure use of innovative technology with respect to energy management and efficiency or the convergence of power environmental and carbon emission reduction policies. If you have an article or articles to submit for inclusion in the Forum Notebook please convey it electronically by responding to this e-mail or fax or mail it as noted in the signature concluding this message by no later than May 4th. If you are intending to write out your remarks to the Forum we would also welcome receiving those in advance of the Forum for inclusion in the materials provided to participants. Please feel free to contact us with any questions or comments. Thanks for your attention to these requests. We look forward to seeing you at the Forum on May 22nd. Sincerely Heidi VanGenderen Senior Associate Wirth Chair in Environmental and Community Development Policy Institute for Policy Research and Implementation University of Colorado-Denver 1445 Market Street Suite 350 Denver CO 80202-1727 Tel - 303-820-5676 Fax - 303-534-8774 Marshall Kaplan Tel - 303-820-5605 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request for Confidential Information by the CPUC Body:: Per your request. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: ----------------- What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Unbelievable! Body:: keep sending the message board quotes. Sometimes when I open them I have trouble locating the specific quote (other times I'm taken right to it). Do you imbed the URLs differently? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Associations Body:: No special requirements but it's good to keep track of in case we want a point of contact. Thanks John Wack@EES 09/22/2000 05:05 PM To: Steven J Kean/NA/Enron@Enron cc: Marty Sunde/HOU/EES@EES Samuel Harrell/HOU/EES@EES Subject: Associations Steve a recent hire within my group of Risk Management Samuel Harrell is on two energy associations. They are the Association of Energy Services Professionals International (AESP) and the American Association of Blacks in Energy (AABE). Sam is a member of good standing in both and has recently been nominated to join the Board of Directors for the AESP. I was not sure if Enron had any special requirements concerning registration of employees in associations or not. If I need to do anything specific I would appreciate your guidance. Hopefully this will work as the needed notice. Thanks What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Kissinger Body:: Sorry I got overwhelmed by California. I have not talked to Ken yet and will be in Japan until Friday. Perhaps we can hook up then? From: Rebecca McDonald/ENRON@enronXgate on 05/11/2001 02:46 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Kissinger Steve We never closed the loop on Kissinger. If you are around next week why don't we talk and resolve what we want to do so that I can proceed? Does that work for you? Rebecca What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: RTO/market power discussion document Body:: In the underscored language added to the RTO section I would insert access to between the words planning and maintenance. Cynthia Sandherr@ENRON 07/20/2000 06:22 AM To: Steven J Kean/HOU/EES@EES Joe Hartsoe/Corp/Enron@ENRON dwatkiss@bracepatt.com cingebretson@bracepatt.com cc: Subject: FW: RTO/market power discussion document ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Demonstration Procedure Body:: Looks good nice work. Let's get it out Vance Meyer 06/11/2001 01:02 PM To: Steven J Kean/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON cc: Subject: Demonstration Procedure This is the demonstration procedure for Enron offices. It has been reviewed by Security Legal and at least 3 PR folks. Provided you have no issues I recommend that we put it out from Mark's machine with a tip-on note to 1) officers 2) PR people 3) security people. Vance What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential information Body:: FYI Leslie What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: RTO Orders - Grid South, SE Trans, SPP and Entergy Body:: I'm still a junkie .... please email copies of the orders. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - Elizabeth Linnell Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: EnronOnline Market Descriptions Body:: Per my voicemail. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: [Second Delivery: WPTF Friday Amen Burrito] Body:: Sorry about this gang but my new computer messed up the e-mail list. It's 4 am and I think I have fixed it. Maybe. Bear with me if you are getting this for the second time this morning. gba X-Mozilla-Status2: 00000000 Message-ID: <398A81DA.E883D290@idt.net> Date: Fri 04 Aug 2000 01:42:26 -0700 From: Gary Ackerman Reply-To: foothi19@idt.net Organization: Foothill Services X-Mailer: Mozilla 4.74C-CCK-MCD {C-UDP EBM-APPLE} (Macintosh U PPC) MIME-Version: 1.0 To: webmaster Subject: WPTF Friday Amen Burrito Content-Type: multipart/alternative=20 ?=20 THE FRIDAY BURRITO=20 ...more fun than a fortune cookie and at least as accurate.=20 Everyone is getting into the act.? When I started this gig I was the only= =20 guy in town writing to folks like you about the power industry in=20 California.? I wrote about what=01s new what=01s happening and all the= =20 important stuff.? This week Governor Gray Davis decided to write his own= =20 Burrito.? His epistle got more press than mine but why is he muscling in o= n=20 my turf?? Not to be outdone PUC President Loretta Lynch released a report= =20 which looks into every facet of California=01s power business.? No stone l= eft=20 unturned. I=01m telling you there isn=01t enough room in this business f= or all=20 of us.? They need to clear out.=20 With people like Herr (Hair?) Peace Governor I=01m-Not Mr.-Rogers Davis a= nd=20 Let=01s Do Lynch who needs a Friday Burrito?? They re-define our reality = each=20 week with mind-numbing aplomb.? For example starting in early June the PX= =20 was ordered to compete for business against other Qualified Trading=20 Vehicles.? Then two weeks later the Energy F_hrer legislated that idea to= =20 an early death which kept the status quo for at least one year.? This week= =20 the PUC approved 5-year bilateral deals for PG&E and SCE thereby opening t= he=20 PX to competition and emasculating the PX=01s Block Forward Market. Zip = bam=20 boom.=20 I can=01t wait to see what next week will bring.? I hear Senator Bowen is= =20 holding Committee hearings on re regulating the industry and the Governor= =01s=20 new Energy Security Council will meet to decide six things:=20 What=01s for lunch?=20 Who will sit at the head of the table?=20 Does anyone have good seats for next week=01s Democratic convention?=20 Is there anyone we haven=01t indicted yet in the power industry?=20 Who will crank up the air conditioning in this room?? It=01s getting too w= arm.=20 Then they will collect data from innocent businesses under subpoena ignor= e=20 the facts and publish a report.? It makes one want to take a deep breath= =20 and inhale the scented fumes of democracy.=20 You know I can=01t think about where to begin so let=01s start somewher= e.=20 Things on the Island of California=20 ?@@@ Is there anyone left at SDG&E with a brain?=20 ?@@@ The PUC issues its scathing report=20 ?@@@ The ISO invokes $250 price caps.? Duh!=20 Things at the throne of FERC=20 ?@@@ Amen for the Morgan Stanley Order=20 Odds and Ends (_!_)=20 Things on the Island of California=20 ?@@@ Is there anyone left at SDG&E with a brain?=20 Well the answer very clearly is no.? I have been astounded by repeated=20 attempts of SDG&E=01s most senior people to ape humans but instead they m= imic=20 apes.=20 Consider the following.? First they waltz their default customers into the= =20 summer with little of no protection from price spikes in the wholesale=20 market.? Forgivable in that it is human to err.? The prices skyrocket in=20 June and they start looking for who to blame.? =01&Must be them damn=20 independent generators=018 say their managers.? Gary Cotton informs the IS= O=20 Governing Board that hedging SDG&E=01s position in the Block Forward Marke= t=20 wouldn=01t have made any difference.? There=01s one nobel laureate who mi= ssed his=20 prime.=20 Next under pressure they ask for help from suppliers and anyone else who= =20 will assist the utility and their customers.? Nine offers show up at their= =20 table and they can=01t choose any of them.? Again Mr Cotton tells his fe= llow=20 ISO Governing Board members that these things take time and we don=01t to= rush=20 since there are many legislative barriers and well the surfing was good= =20 this week so why spoil it?=20 Now they are in a panic because the Energy F_hrer is visiting old ladies=20 living in trailer parks advising them not to pay their SDG&E electricity= =20 bill and to continue to operate their air conditioners.? SDG&E puts a full= =20 page ad in the local newspaper telling everyone that SDG&E is doing=20 everything it can to lower their electric bills including asking the ISO f= or=20 a $250 price cap but the public can help by calling the ISO [address and= =20 phone number provided in the ad] and urging them to lower the cap.? I alway= s=20 thought the location of the ISO was a State secret for security reasons.? N= o=20 secrets in San Diego.=20 But we are not done.? No sir we are not.? Those buffalo heads who run that= =20 company decide they will win a gold star on their collective foreheads and= =20 implement one of the four resolutions passed by the Electric Oversight=20 Board.? The one they pick is to petition FERC on an expedited basis to cap = at=20 $250 the price at which sellers may bid energy or ancillary services into= =20 the ISO and the PX.? The primary reason is that Western power markets are n= ot=20 workably competitive.? In other words they want FERC to set a max price on= =20 what generators can sell in addition to the price limit at which the ISO ca= n=20 buy!=20 What I find most astounding about this double talk is that SDG&E continues = to=20 collect tons of money from the sales of regulatory must run energy into the= =20 PX.?? These are sales from their stranded assets.? Their grief hasn=01t ab= ated=20 their greed.=20 So to recap SDG&E missed the boat on price hedging failed to win consume= r=20 confidence in public meetings asked for help from suppliers and did nothin= g=20 in response then filed at FERC to cap the sale price because the wholesale= =20 market into which they sell (over-priced?) energy is not workably=20 competitive.? Too much time in the direct sun light.=20 Things on the Island of California=20 ?@@@ The PUC issues its scathing report=20 The PUC report released yesterday is a gem with which I have not spent enou= gh=20 time.? I only read the Executive Summary and that only because our counsel= =20 Dan Douglass forwarded me a copy. Let me pick out some of the gems in=20 President Lets Do Lynch=01s burrito.? I would recommend reading the whole = text=20 if you have time and if you seek perverse entertainment.=20 =01&California is experiencing major problems with electricity supply and= =20 pricing caused by policies and procedures adopted over the past ten years.= =20 =01& Since June wholesale prices for electrical power in California have= =20 increased on average 270% over the same period in 1999 resulting in over $= 1=20 billion in excess?? payments for electricity.=20 =01&Hot weather aging power plant and transmission infrastructure and=20 dysfunctional bidding behavior in the wholesale power markets combined to= =20 drive prices up ...=20 =01&Because of serious market defects and tight supply of electricity=20 purchasers of California power will likely pay billions more in electricity= =20 costs this year. Moreover these price increases do not necessarily fund ne= w=20 investments in electricity supply or delivery reliability - they may flow= =20 solely to power producer profit margins.=20 =01&Despite the Electricity Oversight Board's legislative mandate to overse= e=20 those institutions we have been unable to obtain [bid] data. Nevertheless= =20 ... we believe enough evidence of questionable behavior exists that the= =20 Attorney General should conduct an investigation into these statewide marke= t=20 practices coordinating with other State agencies including the PUC and th= e=20 EOB. Such an investigation would provide the factual foundation that=20 California policy makers and regulators need to recover any illegally=20 obtained profits.=20 =01&A momentous consequence of California's attempt to create a market in= =20 electricity is that the federal government now regulates California's=20 electric system. Washington D.C. now controls pricing decisions directly at= =20 the wholesale level and indirectly at the retail level and to the extent= =20 that supply incentives are correlated to prices Washington D.C. now affec= ts=20 California's ability to attract new investment in power plants.=20 =01&Past administrations' willingness to cede the State's authority to the= =20 federal government combined with the legislative creation of two non-public= =20 supervisory organizations that have no duty to protect the public or consid= er=20 the retail customer. The Independent System Operator (ISO) and the Power= =20 Exchange (PX) the nonprofit private corporations that operate the State's= =20 transmission system and control wholesale pricing policies are governed by= =20 boards whose members can have serious conflicts of interest. Some of these= =20 board members or their companies financially benefit from higher prices in= =20 electricity markets. Neither of these private organizations is accountable = to=20 the State or its consumers ....=20 ?=20 =01&Despite the federalization and the fragmentation of the State's electri= c=20 services the State of California should protect its businesses and consume= rs=20 from cartel pricing collusive behavior inadequate power plant maintenance= =20 and lack of market planning for adequate electricity supplies.=20 =01&California consumers and businesses deserve to know in advance - as San= =20 Diegans did not this summer - how and when the price of an essential servic= e=20 like electricity will double. California is now largely constrained by=20 federal mandates from providing comprehensive retail price relief as long a= s=20 wholesale prices remain so high. If California tried to re-impose a price= =20 freeze in San Diego now federal regulators would likely prevent that=20 action.? ... Short-term price relief however cannot resolve market gaming= =20 or fundamental wholesale pricing problems controlled by federal regulators.= =20 ?=01&We have been precluded from obtaining the data necessary to know if th= e ISO=20 and PX failed to detect manipulation and gaming on several fronts. We do no= t=20 know how market players acted in price offering and bidding and scheduling.= =20 The FERC has just announced an inquiry into national pricing and energy=20 market issues. California should not wait for national findings before it= =20 investigates California market practices. We recommend that the California= =20 Attorney General immediately subpoena relevant records and data to determin= e=20 the pricing and offering behavior of market participants the actions of th= e=20 ISO and its board members and the actions of generators in supplying=20 California's energy needs.=20 =01&Ten Actions to Consider or Act Upon to Prevent Current Electricity Prob= lems=20 From Spreading in 2001: ...=20 ?=20 ? 2. Create a California Energy Council modeled on the National Security= =20 Council to unify State action to resolve energy problems and to perform=20 integrated energy planning=20 3. Ask FERC for extended wholesale price cap authority to moderate Californ= ia=20 wholesale market pricing=20 4. Ask FERC to recognize the defects in the California and western regional= =20 markets and find that no competitive market exists in California power=20 markets=20 ?...=20 ? ?8. Eliminate potential conflicts of interest in ISO/PX stakeholder board= s=20 9. Improve California's ability to obtain ISO and generator data and enhanc= e=20 the State's enforcement capability for power plant maintenance price=20 manipulation and generation gaming consistent with protection of proprieta= ry=20 business information=20 10. Provide the EOB with effective enforcement ability and additional=20 oversight authority for the ISO and PX. =01&Ten Issues to Consider or Act Upon Within the Next Six Months: ...=20 ? 4. Streamline state power plant siting procedures consistent with=20 environmental requirements and prioritize applications to advance clean= =20 BACT+ power plant proposals.=20 5. Institute use-it -or- lose-it permitting power plant licensing and=20 emissions credits rules to ensure power plants get built=20 ...=20 ?8. Reform PX pricing protocols and structures to lower wholesale and retai= l=20 prices and reduce excess profits=018 I told you I don=01t need to write a Burrito anymore.? The Democrats in=20 Sacramento are doing that for me.? Welcome comrade.=20 Things on the Island of California=20 ?@@@ The ISO invokes $250 price caps.? Duh!=20 It is really hard to describe the drama of an ISO Governing Board meeting= =20 especially when our favorite topic arises.? It seems the only time the Boar= d=20 becomes animated is when one of three issues are on the agenda: price caps= =20 FTRs and priorities for software enhancements. Otherwise its pretty much= =20 hum-drum.=20 =01+Round and =01+round we went once again.? A few more forced votes tippe= d the=20 scale in favor of the cap.? There were 15 yes votes which included a force= d=20 yes vote from our friend Jerry Toenyes by order of Secretary of Energy Mr.= =20 Richardson. [Jerry did you realize that the last letters of your name coul= d=20 be re-arranged to spell =01&NO ET YES=018?? Kind of a french thing.] I=01m= sorry=20 about that vote Jerry.? You still go in my book as one of the brave and bo= ld=20 for standing up to that sort of intimidation for so long.? Your picture in= =20 the SF Chron said it all.=20 The brave souls who stood tall and voted NO included David Parquet (Enron)= =20 Jan Smutny-Jones (IEP) Barbara Barkovich (CLECA) Caolyn Kehrein (CMA) Da= n=20 Kirshner (EDF) and Stacy Roscoe (Procter & Gamble).? Now I must admit tha= t=20 Dynegy=01s Greg Blue did help by voting a Texas No spelled =01&A-B-S-T-A-= I-N=018.??=20 I have instructed Dynegy trader Dave Francis in Houston to work with Greg t= o=20 correct that problem.? We=01re going to work things out.=20 The Energy F_hrer addressed the Board again.? I didn=01t mind that I only= had=20 a few brief very brief moments to address the Board and Herr (Hair?) Peac= e=20 got over 20 minutes.? That didn=01t bother me at all.? He did more damage = to=20 himself in 20 than I could do in 2.? He blasted away at everyone who oppose= d=20 him.? He pined about Camden quitting the Board.? He said he knew how prices= =20 and markets work that it isn=01t the way those academic egg-head FERC-lo= ving=20 economists tell you who pray to the gods of competition.? He lambasted WAPA= =20 for withholding generation to protect fish and wildlife (what was that all= =20 about?).? He predicted that on Thursday=01s PUC meeting he and all the oth= er=20 powerful Democrats Republicans and angry citizens of San Diego would deman= d=20 that the PUC impose a rate cap on retail electric rates in San Diego that a= re=20 just and reasonable (it didn=01t happen).? And on and on and on.? This man= is=20 very delusional. He believes that Steve and only Steve Peace can save the= =20 world.? He believes that political will trumps judicial quasi-judicial or= =20 independent Board actions.? This man makes relevant all the abstract musing= s=20 of the philosopher Friedrich Nietzsche (1844-1900) ... The will to power t= he=20 ?bermensch the transvaluation of values etc.=20 But we are getting under (uber?) his skin with the help of the press.?=20 Wednesday afternoon I called Commissioner Dick Bilas to see if he thought= =20 whether the next day=01s PUC meeting was going to be a roll over. Dick sai= d he=20 got a call from Peace and that Peace said he would not come to the meeting= .?=20 Apparently Peace had received a lot of press and all of it bad.=20 That=01s the thin line of freedom which keeps tyranny at least one step aw= ay=20 from our front door.=20 ?>>> Things at the throne of FERC=20 ?@@@ Amen for the Morgan Stanley Order=20 And now the good news.? You deserve this.? FERC gave the California market= a=20 little wiggle room last Friday.? FERC issued a last minute reply to the=20 complaint by Morgan Stanley Capital Group relating to the ISO=01s intent t= o=20 lower the price cap.? FERC denied the complaint but they didn=01t waste t= ime=20 with an Order to simply deny a complaint.? FERC danced on the head of the I= SO=20 and pulled the bite out of the price cap.=20 Here are some excerpts:=20 =01&We accepted this [Amendment 21] not because it was a cap on sellers=01= prices=20 but because it would promote order and transparency in the market by clearl= y=20 telling sellers of the maximum price the ISO was willing to pay and allowin= g=20 sellers to make informed economic choices on whether to sell in the ISO=20 market or to sell elsewhere...=20 =01& ... The ISO has no more or less ability to procure capacity and energy= than=20 any other buyer of these services ... If the ISO is unable to elicit=20 sufficient supplies at or below its announced purchase price ceiling (becau= se=20 generators are free to sell elsewhere if they choose) it will have to rais= e=20 its purchase price to the level necessary to meet its needs. ... Therefore= =20 an increase in out-of-market (OOM) calls for generation may be necessary to= =20 maintain system reliability.? Because the current payment for OOM is not=20 subject to a maximum purchase price the resulting overall payments may be= =20 higher.=20 =01&To the extent the ... ISO Board resolution contemplates implementing a= =20 directive that generators must bid their capacity into the ISO markets unde= r=20 any circumstances (e.g. when system load exceeds 38000 MW) such a=20 requirement is not permitted by our ... Order and the ISO tariff. ... Futur= e=20 implementation of the ISO Board resolution with regard to a requirement to= =20 sell would require significant revisions to the ISO market rules.? Such=20 market changes could not become effective absent a corresponding amendment = to=20 the ISO tariff which would have to be filed under section 205 of the FPA.= =018=20 Well. What do you think about that?=20 Just wait.? Here is what the sleeping bear Commissioner Hebert said in his= =20 concurring remarks:=20 =01&Getting to the bottom of the problem in my view requires us to begin = a=20 proceeding to rescind our approval of the ISO as the operator of the=20 California grid.? The record supports such a move. ... A memorandum to the= =20 ISO from a stakeholder who resigned from the governing board eloquently=20 brings to our attention repeated attempts to undermine the independence of= =20 the ISO. The memorandum also thoughtfully outlines consequences to the=20 markets of a return to =01+command and control.=01=20 =01&Because these allegations come from a non-market participant especiall= y=20 should we take heed.? We must also take notice of the public pressure on th= e=20 Board to compromise its independence.=018=20 Amen brother amen.=20 Odds and Ends (_!_)=20 As you can imagine this week like an endless string of weeks before this= =20 has been interminable.? I get about three phone calls a day from press=20 reporters very little of which ever sees print.? My shtick is just too=20 complex for casual readers.? But I do notice that the reporters are asking= =20 better questions.? The public is becoming more savvy.? The information flow= =20 is moving in our favor and will disarm the forces of evil in about 10=20 years.=20 I have other problems on my mind.? I am working on a new computer system.?= =20 Really it=01s just an upgrade of an older computer that is a bit faster t= han=20 the laptop I tried to upgrade very unsuccessfully.? As a result of the all= =20 the new hardware and software I purchased my office looks like a war zone= =20 with an odd mix of PUC service copies computer documentation and diskette= s=20 laying all around. Quite a mess.=20 Prepare for the future.? Our next general meeting is scheduled for Thursday= =20 and Friday October 5 and 6 at Moro Bay.? Barb Ennis will prepare a blurb f= or=20 us in next week=01s Burrito about room reservations timing golf etc.? O= ur=20 guest speakers will include MSC Chairman Professor Frank Wolak who will tal= k=20 on the subject of his choice Ms. Irene Moosen of Grueneich Resource=20 Advocates who will make a presentation on the distributed generation case= =20 before the PUC and William Freddo of PG&E National Energy Group who will= =20 give us some education on operating a power plant inside the New England IS= O.=20 Now for your daily bread provided this week by Dan Douglass.? Last week we= =20 had a joke about Catholics.? This week it=01s agnostics.=20 An atheist was taking a walk thru the woods admiring all that the accident= ?=20 of evolution had created.? What majestic trees!? What powerful rivers! Wha= t?=20 beautiful animals!? he said to himself.=20 As he was walking alongside the river he heard a rustling in the bushes?=20 behind him.? As he turned to look he saw a 7 foot grizzly bear charging?= =20 towards him. He ran as fast as he could up the path.? He looked over his?= =20 shoulder and saw that the bear was closing in on him.? He tried to run even= ?=20 faster so scared that tears were coming to his eyes. His heart was pumping= ?=20 frantically as he tried to run even faster but he tripped and fell on the?= =20 ground.? He rolled over to pick himself up and saw the bear right on top of= ?=20 him raising its paw to kill him.=20 At that instant he cried out Oh my God! And time stopped. The bear froze.= ?=20 The forest was silent.? The river even stopped flowing.? A bright light=20 shone? upon the man and a voice out of the sky said You deny my existenc= e=20 all? these years teach others I don't exist and even credit my creation to= =20 a? cosmic accident and now do you expect me to help you out of this?=20 predicament?? Am I to count you as a believer?=20 The atheist ever so proud looked into the light and said It would be=20 rather hypocritical to ask to be counted as a believer after all these=20 years? but could you make the bear a believer?=20 Very well said the voice. And the light went out the river flowed the?= =20 sounds of the forest continued and the bear brought both paws together?= =20 bowed his head and said Lord I thank you for this food which I am about= ?=20 to receive.=20 Amen.? And have a great weekend.? Oh and thanks to all of you who sent me= =20 happy birthday wishes.? It was very much appreciated.=20 KSB=20 gba What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Comparable Worth Legislation Body:: This is an issue we need to stay on top of. Felicia: could you please put= =20 some background together for everyone on the list? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ISO Market Stabilization Plan Body:: Thanks for taking the lead on this. Note Tim's question about handicapping the liklihood of approval. Prices will move in the West based on these odds. We need to have a better view than anyone else. Ray Alvarez 04/13/2001 01:19 PM To: James D Steffes/NA/Enron@Enron cc: Tim Belden/HOU/ECT@ECT Joe Hartsoe/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Alan Comnes/PDX/ECT@ECT Steve Walton/HOU/ECT@ECT Susan J Mara/NA/Enron@ENRON Subject: Re: ISO Market Stabilization Plan Tim although there's always a chance my impression is that the FERC won't buy the ban on exports as this would appear to run afoul of the Commerce Clause and certainly goes counter to everything that FERC hopes to accomplish with their own Order 888 and 2000 initiatives. I am less certain about the direction FERC will go on pricing since even the staff has recognized stumbling blocks in their own recommendation and offers possible variants. The ISO has not submitted revised tariff sheets for approval yet so it is unlikely they would try to implement their own plan in the near term. If they try to do so without FERC approval possible legal avenues might include the filing of a complaint at FERC asking for fast track processing (this fast is measured in weeks not days) and/or seeking injunctive relief in court (faster) which can be hard to obtain but not impossible depending entirely on the circumstances. Will keep you posted if I learn anything new on this. Ray James D Steffes 04/12/2001 11:21 PM To: Tim Belden/HOU/ECT@ECT cc: Joe Hartsoe/Corp/Enron@ENRON Ray Alvarez/NA/Enron@ENRON Steven J Kean/NA/Enron@Enron Alan Comnes/PDX/ECT@ECT Steve Walton/HOU/ECT@ECT Susan J Mara/NA/Enron Subject: Re: ISO Market Stabilization Plan Ray -- Can you please take the lead in responding to Tim re: FERC v. state actions? Sue -- Any info on whether the ISO would do this unilaterally? Jim To: Joe Hartsoe/Corp/Enron@ENRON James D Steffes/NA/Enron@Enron Ray Alvarez/NA/Enron@ENRON Steven J Kean/NA/Enron@Enron Alan Comnes/PDX/ECT@ECT Steve Walton/HOU/ECT@ECT Susan J Mara/NA/Enron@ENRON cc: Subject: ISO Market Stabilization Plan The recent plan filed at FERC is horrible. The two most aggregious parts are the cost based standing bids and the ban on exports. I know that we are commenting on this proposal. I am also looking for intellegence on whether the ISO proposal has any chance of getting approved by FERC. If it is not approved by FERC what can the Californians do? California has ignored FERC before. If they attempt to unilaterally implement changes what is the likelihood that the Feds step in to intervene? If you hear anything on this matter please keep me posted. The proposed plan will have a huge impact on the California market and we need as much advance notice as possible. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: PRC cluster descriptors - draft Body:: I think this is a fine attempt but I continue to believe that a pure relative ranking offers the most flexibility and is more like the way the process works in practice. A separate list of desired behaviors criteria etc can be used to guide discussion but I believe the ranking itself should remain purely relative. Gina Corteselli 09/14/2000 06:04 PM To: Cindy Olson/Corp/Enron@ENRON David Oxley/HOU/ECT@ECT Steven J Kean/NA/Enron@Enron cc: Michelle Cash/HOU/ECT@ECT Subject: PRC cluster descriptors - draft All Aattached are a draft of the PRC cluster descriptors which we discussed several weeks back. I has sent a first draft to Michelle and Dick and both had some suggestions which I have tried to incorporate. I am still awaiting Dick and Michelle's impressions of the below but also look forward to your impressions and input. Likewise I would appreciate your input on whether or not we need to change the ratings on the feedback forms to numerical ratings 1-5 to mimic the clusters. look forward to hearing from you Many thanks Gina ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: NAES meeting in Barton Creek in Austin Body:: [Dan Sponseller 412 355 8650 -- called Brian Barrington] Laura Houston x3366 is contact 9:30 - 10:00 Regulatory Update gas and electricity positions that we've taken initiatives and events that they should be aware of retail perspective if there is something they should know about Audience is Amanda's team approx. 100 people. Can use overheads or slides. We need to let Sheila Hatten know what you'll use. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Dereg Articles Body:: Looks good Mark Palmer 09/27/2000 02:09 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Re: Dereg Articles Here's the draft that Allegretti is sending. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Bingaman reliability draft language Body:: It is important to point out that under the Bingaman reliability language FERC has total discretion as to whether to adopt a NERC standard. Charles does make a good point about the deference language. As written FERC has discretion to defer to NERC or an RTO to monitor and enforce compliance. At a minimum that language should be expanded to include another entity like an EISB. Similarly the language should probably be tweaked to allow FERC to adopt standards of an organization other than NERC. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - Resume for Andy Blanchard Body:: Attached is a resume for a gentleman who has relocated as a trailing expat spouse to Houston who we are looking to find a suitable position somewhere in Enron. I know that one or two of you have already seen his resume and at the time didn't necessarily have a role for him. I would be very grateful if you could take another look and see if anything has now changed. By way of background he was previously working with Eastern in the UK in a back office capacity looking at their approach to the UK Gas regulatory framework known as the Network code. He has done a little consulting work since relocating to Houston in the online area. His references are very good. He is available with immigration clearance as a local hire probably at Senior Specialist level. As an additional incentive I would be prepared to underwrite his costs in the event you decided in the first 6 months that his performance did not meet your expectations (Obviously - I am highly confident this will not be the case!). What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL - CA Customer Letter Body:: Here is the note we sent to our CA customers this weekend to extend with Evergreen. Jim ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: FERC rulemaking on Generator Interconnection Body:: Jim -- The quick answer to your question on the Barton bill is that yes it does = appear to address this tax issue involving interconnections at least in pa= rt. There is language in Title VIII on various tax issues. One of them ex= ludes from gross income certain amounts received by electric utilities spe= cifically including connection fees. In the example in the e-mail the iss= ue was not fees paid directly but assets paid for by the generator that ar= e then transferred to the utility. Will check on that angle. In any event Title VIII (while in the Barton bill) is not in the jurisdict= ion of Barton's subcommittee. Instead the tax title would have to go thro= ugh the Ways and Means Committee. There were some energy tax provisions in= the House-passed energy bill last August. Chris and I will consult tomorr= ow to see if this issue was included in that bill. Aside from the tax issue Barton bill would require the type of interconnec= tion rulemaking that FERC is now conducting (both for connections to local = distribution and to transmission). In each case the cost of interconnecti= on would have to be comparable to what the utility charges others similarly= situated. I will go back to double check but off the top of my head I re= call that the Bingaman draft specifically socializes the costs of interco= nnection. John What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: PJM Stip Body:: Can we also get something in the stip that limits the market making activity or at least promises a reexamination of the scope of the market making activity after some period of time. Also can we strengthen the language to give us something beyond simply a right to file -- which is a right we have anyway. James D Steffes 03/16/2001 03:34 PM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron cc: Joe Hartsoe/Corp/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Subject: PJM Stip Attached is the proposed Stip to allow PJM to move forward as an RTO. In the Stip we argue that PJM should be approved by FERC but condition our acceptance on a FERC process to unify the Northeast markets. My only comment is to delete the final WHEREAS paragraph on congestion management. While our ability to later stop PJM from being an RTO is limited I believe that this gives us the ability to drive a consolidation of the Northeast markets - which is one of the goals of the East Power desk. In addition I think that the overall direction of PJM in commercializing its software is a good activity for our interest - even if we don't want everything in their package. Sarah is out until Monday when we need to get back with PJM. Jim What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: HPL Closing Body:: fyi - Jade Eaton is one of Lara's contacts at DOJ What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: DRAFT Comments on Barton RTO Draft Body:: I tried to make it clear that we were not ourselves moving off of 4/5 RTOs -- and I will try to make that clearer. I was just trying to take advantage of what Wood and others said to show that they are not the heavy-handed regulators that Barton and others on the Hill are painting. In other words I wouldn't have asked them to say what they did -- but once said we might as well get some mileage out of it. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FYI From Marty Sunde: Request for Ken to contact Chancellor Reed, California State University System Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Expense Reports Awaiting Your Approval Body:: ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron legislative package Body:: nan What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: PG&E PX Credit Calculation -- CONFIDENTIAL ATTY CLIENT WORK PRODUCT Body:: I am not sure I understand your second paragraph. If PG&E reduces going-forward procurement costs to reflect FERC-ordered refunds I do not understand why it would affect already-issued CTC charges. The cost of power would be cheaper going forward. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: A&M - Bush Library Foundation & School of Public Policy Body:: Let's talk. While there is always some value in these things it is ususally quite small and consumes more valuable resources in trying to capture the benefit than the benefit itself. From: Michael B Rosen@ECT on 07/13/2001 08:44 AM To: Steven J Kean/NA/Enron@Enron cc: Subject: A&M - Bush Library Foundation & School of Public Policy Steve- We have been approached by the Texas A&M/George Bush Presidential Library Foundation and School of Public Policy to endow additional funds. Enron had made an original contribution to the library foundation back in 1998 totaling $250K over five years. I am working with Community Relations and A/A Recruiting to evaluate the latest request and to discuss where Enron may have interest or find leverage for our Government Affairs Recruiting or PR efforts. The Foundation is willing to work with us to establish whatever type of program(s) and/or participatory involvement we would like. We have discussed an Enron speaker series classroom lectures advisory committee seats and the likes. I have already had a chance to run this by Rick Shapiro and Rob Bradley. Although Rick was noncommittal regarding his team's time for speaking or lecturing he seemed supportive of the effort. Rob has already been participating in some speaking opportunities there and supported expanded efforts. What are your thoughts on contribution levels (another $250K was suggested by CR) and any specific program or relationship opportunities regarding the Library Center or School of Public Policy. Please grab me for quick conversation when you have time. Thanks. Mike What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: EBR - Public Affairs - Nov. 6 Body:: I may need to spend some time with you in advance but you don't have to plan on coming here. Mark Schroeder@ECT 10/15/2000 06:32 PM To: Maureen McVicker/NA/Enron@ENRON cc: Steven J Kean/NA/Enron@Enron Beverley Ashcroft/LON/ECT@ECT Subject: Re: EBR - Public Affairs - Nov. 6 trust my non-attendance is okay with Steve. If not please so advise or if he wants my participation by conference call that could be arranged. thanks mcs Maureen McVicker@ENRON 12/10/2000 09:52 To: Richard Shapiro/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON James D Steffes/NA/Enron@Enron Mark Schroeder/LON/ECT@ECT Michael Terraso/OTS/Enron@ENRON Elizabeth Linnell/NA/Enron@Enron John David W Delainey/HOU/ECT@ECT Rosalee Fleming/Corp/Enron@ENRON Sherri Sera/Corp/Enron@ENRON Katherine Brown/Corp/Enron@ENRON cc: Ginger Dernehl/NA/Enron@Enron Cindy Derecskey/Corp/Enron@Enron Marcia A Linton/NA/Enron@Enron Beverley Ashcroft/LON/ECT@ECT Laura Glenn/OTS/Enron@ENRON Helen Kay Chapman/HOU/ECT@ECT Subject: EBR - Public Affairs - Nov. 6 The EBR (Executive Business Review) for Public Affairs has been rescheduled: The new date is: DATE: Monday Nov. 6 TIME: 8:30 A.M. (block 2 hours on your sched just in case) PLACE: EB 50M03 ATTENDEES: Dave Delainey (if schedule permits) John Hardy Steve Kean Ken Lay Elizabeth Linnell Mark Palmer Mark Schroeder (will not be attending) Rick Shapiro Jeff Skilling Jim Steffes Mike Terraso What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Western Wholesale Activities - Gas & Power Conf. Call Privileged & Confidential Communication Attorney-Client Communication and Attorney Work Product Privileges Asserted Body:: FYI Attached is memo I prepared for Jim and Rick on the PNW refund case. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Catch Up Body:: BTW = By the way. Putnam in Boston. it's official. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Contact Body:: Contact Dave Parquet and Jeff Dasovich in our San Fran. office. Dave has worked on Enron's proposals to San Diego and Jeff has been supporting him from a gov't/reg affairs standpoint. From: Michael Kenneally@ENRON COMMUNICATIONS on 09/08/2000 10:51 AM To: Steven J Kean/NA/Enron@ENRON cc: Subject: Re: Contact Steve: Chris Holmes recommended I contact you concerning the attached inquiry. I recently met with a federal representative from San Diego who had asked if I could send him any information on Enron's ability to hedge energy prices. After a summer of rolling brown outs and soaring prices he is looking for ways to avoid the scenario in the future. Could you recommend the best avenue for responding to this request? I appreciate you assistance in this matter. Regards Michael x 35868 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: See natural gas price article below. Our buddy Paul Carpenter has turned o= n=20 us (not to mention that he seems to be talking nonsense). How about giving= =20 him a call? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential Contact data and RFI Body:: Kevin I had the Capacity forecast column units mislabeled Here is the revised one. If you want just have your NEEPOOL lead type over our forecast and re-send to us. We will not let this get out of our shop and we will get you in on a block to buy. Thanks again Fred ----- Original Message ----- From: Presto Kevin M. To: Fred W. Giffels Sent: Tuesday February 12 2002 8:07 AM Subject: RE: Confidential Contact data and RFI Any nuclear specific info? Kevin Presto UBS Warburg Energy kevin.presto@ubswenergy.com Phone: 713-853-5035 Fax: 713-646-8272 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Management Conference - Save the Date Body:: looks fine From: Terrie James/ENRON@enronXgate on 07/19/2001 04:31 PM To: Steven J Kean/NA/Enron@Enron Cindy Olson/ENRON@enronXgate cc: Sherri Sera/ENRON@enronXgate Marge Nadasky/ENRON@enronXgate Subject: Management Conference - Save the Date Steve and Cindy Attached is the electronic Save the Date memo for the Management Conference. We are preparing to send it out next week. Please let me know if you have any comments or concerns on the e-mail. As for distribution we've worked with HR on the distribution list for VPs but will circle back with David Oxley's team to ensure we have the most up-to-date list. Since some VPs in redeployment will most likely find positions within Enron by November I don't plan to exclude them from the distribution ... unlike United Way where we are not soliciting employees in redeployment for a contribution. I look forward to any feedback. Terrie James Senior Director Public Relations Enron Broadband Services (ph) 713.853.7727 (fax) 713.646.3248 terrie.james@enron.com What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Presentation to faculty and students at Berkeley Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Rich Products Body:: Looks good. Peggy Mahoney 07/24/2000 06:20 PM To: Mark Palmer/Corp/Enron@ENRON Steven J Kean/HOU/EES@EES Karen Denne/Corp/Enron@ENRON Cedric Burgher/Corp/Enron@ENRON Mark Koenig/Corp/Enron@ENRON Paula Rieker/Corp/Enron@ENRON Jeremy Blachman/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Karen S Owens@ees@EES Kevin Hughes/HOU/EES@EES Mark S Muller/HOU/EES@EES Vicki Sharp/HOU/EES@EES Marty Sunde/HOU/EES@EES Dan Leff/HOU/EES@EES Elizabeth Tilney/HOU/EES@EES Dave S Laipple/DUB/EES@EES James E Keller/HOU/EES@EES cc: Subject: Rich Products Please review the attached draft news release about our agreement with Rich Products and let me know if you have any comments by 5pm Tuesday July 25. We are scheduled to release on Wednesday July 26. If you have any questions please call me at x57034. Rich Products is a major US food manufacturer headquartered in Buffalo NY. The company ranked #122 in Forbes Private 500 and has sales around $1.5 billion. Rich Products is owned and operated by the founding Rich family. Products manufactured include frozen meats bakery products and non-dairy creamers. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Body:: Please send the economist piece around. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Update Day 1 Second Session FERC CA Settlement Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: California Public Affairs Strategy Body:: To make sure that Enron is not missing any opportunities to make our points on competition we need to develop some key message points and facts. My understanding is that the key story line is that COMPETITION IS WORKING AND SHOULD BE PUSHED FORWARD. We need to be able to give examples of what is happening - deregulation customers are winning. For example our CSU customers are just fine even with higher energy markets. I think that are some key questions that we need to consider when we put these together: Who is the audience? My answer - California policymakers key stakeholders FERC federal government. Can we use this in the FERC Investigation on Markets? My answer - we have to California is too big and important not realize that California will play a role in FERC's discussions. What is the timing of message? My answer - Wherever and whenever needs to be coordinated. This CA legislative process (next 2.5 weeks) may be a possibility. FERC Investigation. Taking the story nationally is good if we have the facts from CA. Who will deliver the message? My answer - Everyone on the Enron team needs to have the same message all of the time. We can't let any opportunity pass us by. Do we demonize the utilities? My answer - if necessary we just need to make sure that we have as many facts to prove our points if we do attack. How do we prove that rolling back to regulation is ridiculous? My answer - retain LEGC to develop the hypothetical of what would have happened? NEEDS TO BE DISCUSSED INTERNALLY - LEGC MAY NOT BE THAT FRIENDLY. Next Steps: Jeff Dasovich needs to put out first cut based on our earlier notes and any incremental information from our analysis teams (e.g. TCA McNally / Temple). Thanks Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: MEMO Body:: ----------------- What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Folder to safely pass information to Arthur Andersen Body:: We have become increasingly concerned about confidential information (dpr/position info curves validations/stress tests etc) being passed to Arthur Andersen for audit purposes over the Web to their Arthur Andersen email addresses. (necessary now they no longer have access to Enron's internal email system) Please use the folder described below when passing any info (that you would have concerns about if it was picked up by a third party) via the shared drive that has been set up for this specific purpose. Note: AA should also use the shared drive to pass info back if there are questions or the data needs updating. We should also consider the sensitivity of audit findings and special presentations if they are being distributed electronically. Please pass this note to others in your groups who have the need to pass info back and forth. Details on how to access for those who will use this method to pass info: A secured folder has been set up on the o drive under Corporate called Arthur_Andersen Please post all confidential files in this folder rather than emailing the files to their company email address. If you need access to this folder submit an eRequest through the IT Central site: Arthur Andersen will be able to retrieve these files for review with their terminal server access at the Three Allen Center location. Please contact Vanessa Schulte if you have any problems or questions Beth Apollo What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Doctoral studies Body:: My message was sent before I finished it. I think it would be interesting to focus your attention on this interplay -- what policy changes have meant to companies (ie the winners and losers) and how explicit companies are about how government policy drives their business strategy in these industries. I also think it would be fascinating to compare regulators' visions for the industry they are restructuring with the reality after the fact. I believe you would find some similarities but also some substantial and interesting differences. Good luck with your studies. My best regards to Mike I learned a great deal working for him. Rob Wilson@ENRON 07/24/2000 04:44 PM To: Steven J Kean/HOU/EES@EES cc: Mike McGowan/ET&S/Enron@ENRON Subject: Doctoral studies Steve Vince Kaminski suggested I contact you I'm the Gov't Affairs rep for NNG in Omaha and begin a doctoral studies program this fall at NU. I plan a research emphasis in regulatory politics specific to energy and telecom market convergence and the public interest. I'd welcome any advice or suggestions you have regarding other potential area's of research based on your professional experience in the public policy arena. I appreciate any guidance I'm in the earliest stages of forming my advisory committee and curriculum of study. My supervisor Mike McGowan sends his regards. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Update - Jeff Skilling Conference Call with John Q Anderson Body:: Thanks to Jim and Charles for the reports on the NERC conference call earlier today. Aside from whatever is done directly with NERC on details of their internal operations to respond to our concerns (i.e. Jeff's presentation to their board and the list of issues Charles had) the NERC/PJM drafting process will continue in DC in coming weeks. In addition Congressional staff are likely to be drafting electricity legislation including a reliability title during the August Recess that will start at the end of this week (i.e. we will likely be asked to comment on reliability legislation before any meetings with the NERC board are completed). I will analyze the shortened NERC and PJM Revised versions and share some thoughts based on our objectives. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: job applicant Body:: yes lyoho@enron.com 09/26/2000 09:03 AM To: Steven.J.Kean@enron.com cc: Subject: Re: job applicant Steve -- Yes I am interested in talking to him. Should I contact Eric? Thanks for passing this along. Lisa From: Steven J Kean@ENRON on 09/24/2000 05:37 PM Sent by: Steven J Kean@ENRON To: Lisa Yoho/HOU/EES@EES cc: Subject: job applicant any interest? What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: ECT Strategy Meeting, per Julie Armstrong Body:: At the Four Seasons Hotel - Livingston Room What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Steffes Testimony To House Committee Today Body:: Attached is Jim's prepared statement filed last night for today's House Energy and Air Quality Subcommittee (Chairman Barton) hearing on reliability transmission incentives and siting issues. You will see we use the opportunity to make a plug for large RTOs as well. Jim will actually deliver a five minute oral summary. He is appearing as the EPSA witness in his capacity as chairman of the EPSA Regulatory Affairs Committee. There will be ten witnesses on the panel. Others will represent EEI NARUC APPA LPPC NRECA NERC (David Cook) ELCON Consumers for Fair Competition and GF Energy. We will provide a report following the hearing. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Lou Pais staff meeting, 25C3. Body:: Hartsoe: PJM HoganSPP WSCCHebertdemocratic nominee ACA Andy Rotherham AAE membership (703)875-0764 Gordon Weil page Maureen What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: PJM RTO Order Body:: Great summary. I think the two main issues you raise are the right ones b= ut I have one other thought we should discuss internally. Do we want to cr= eate a set of incentives for the management of PJM that would entitle manag= ement to incentive compensation to the extent they meet certain goals -- eg= relieving congestion on the grid increasing throughput across the transmi= ssion system expediting interconnection (measured in terms of actual inter= connections not just applications approved) etc. This way we could create= an organization that would have the incentive to make a workable and open = transmission system. From:=09Sarah Novosel on 07/13/2001 07:57 AM To:=09Kevin M Presto/Enron@EnronXGate Mark Dana Davis/HOU/ECT@ECT Jeff Ad= er/HOU/EES@EES Edward D Baughman/Enron@EnronXGate Joe Gordon/Enron@EnronX= Gate Janelle Scheuer/Enron@EnronXGate mbrown9@enron.com Mark Bernstein/H= OU/EES@EES John Llodra/Enron@EnronXGate W David Duran/Enron@EnronXGate G= eorge Wood/Enron@EnronXGate Dave Perrino/SF/ECT@ECT Paul J Broderick/Enro= n@EnronXGate Jason Thompkins/Enron@EnronXGate Mason Hamlin/Enron@EnronXGa= te Robert Stalford/Enron@EnronXGate Tom May/Enron@EnronXGate Gautam Gupt= a/Enron@EnronXGate Narsimha Misra/Enron@EnronXGate Steve Montovano/NA/Enr= on@Enron Garrett Tripp/Enron@EnronXGate Berney C Aucoin/Enron@EnronXGate= Jason Thompkins/Enron@EnronXGate Rob Wheeler/Enron@EnronXGate Rogers Her= ndon/Enron@EnronXGate Jim Meyn/Enron@EnronXGate Aleck Dadson/Enron@EnronX= Gate Daniel Allegretti/Enron@EnronXGate Pearce W Hammond/HOU/EES@EES Don= na Fulton/Corp/Enron@ENRON Howard Fromer/NA/Enron@Enron Kathleen Sullivan= /NA/Enron@ENRON Tom Hoatson/Enron@EnronXGate Thane Twiggs/Enron@EnronXGat= e Sarah Novosel/Corp/Enron@ENRON Christi L Nicolay/HOU/ECT@ECT James D S= teffes/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Richard Shapiro/NA/E= nron@Enron Steven J Kean/NA/Enron@Enron Charles Decker/HOU/EES@EES Nick = Politis/Enron@EnronXGate sscott3@enron.com Aleck Dadson/Enron@EnronXGate= Lloyd Will/Enron@EnronXGate Ray Alvarez/NA/Enron@ENRON Susan M Landwehr/= NA/Enron@Enron Charles Yeung/HOU/ECT@ECT Andy Rodriquez/Enron@EnronXGate= John J Lavorato/Enron@EnronXGate Louise Kitchen/Enron@EnronXGate Greg Wh= alley/Enron@EnronXGate susan.j.mara@enron.com Jeff Dasovich/NA/Enron@Enro= n Karen Denne/Enron@EnronXGate mpalmer@enron.com Alan Comnes/Enron@Enron= XGate Tom Briggs/NA/Enron@Enron John Shelk/NA/Enron@Enron Pat Shortridge= /Corp/Enron@Enron Chris Long/Corp/Enron@ENRON Mike Roan/ENRON@enronXgate= Kerry Stroup/NA/Enron@Enron Janine Migden/Enron@EnronXGate Dave Mangskau= /Corp/Enron@ENRON cc:=09=20 Subject:=09PJM RTO Order Attached is a summary of the PJM RTO order. While it is somewhat lengthy = the order has a lot of good information in it that I wanted to share with t= he group particularly the Commission's statements regarding the existing c= onfiguration of the northeast and the need to expand it. We are working on summaries of the New York and New England RTO orders and = will have those out shortly. If you would like copies of the orders just = let us know. We expect the mediation proceeding to begin within the next week. We will = keep you updated. Sarah =20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Tammy Hopkins - Resume Body:: nan What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: OH Energy Summit -- Summary of comments Body:: Barbara-- Very helpful and encouraging report. Sounds like the Gov. and the Consumers Counsel are with us on RTOs. Would they be willing to write their own letters I assume separately to the Ohio congressional delegation? There are several Ohio members on the House Energy and Commerce Committee. Is the Consumers Counsel a Democrat (that would help since there are three Ohio Democrats on the committee -- Brown Strickland and Sawyer?). Even if he is a Republican support from within the state would help a great deal. Thanks. John What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: SMS conference Body:: Ian My secretary contacted SMS. I was surprised that they want to charge me for the conference. Typically the speakers are invited to attend without incurring the cost of a conference. The is the first invitation to speak I received combined with a request to pay for the privilege. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FERC Tech. Conference on CA Natural Gas Transportation- 5/24 Body:: calendar fyi ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential - GSS Organization Value to ETS Body:: Will do. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Priviliged and Confidential communication to my attorney Re: Henry Bath LA Body:: Privileged and Confidential This email contains legal advice Hoyt and Melissa I am assuming that we are discussing contract personnel who provide some sort of services for MG/RW. It looks like there may be some key personnel we want to employ but that there are many whom we don't want to hire. I am not really familiar with the specific facts here. The question of a joint employer arises when a company treats its contract personnel like its own -- by setting compensation controlling their activities engaging in etc. decisions and other ways in which an employer treats its own employees. So if the plan is to have workers doing the same thing with one as a contractor and one as an employee there could be some issues particularly if they share a supervisor. Unfortunately that often is the case with contract personnel. If there are distinctions among the various responsibilities of these workers -- and like workers are treated similarly -- the risk may be reduced. It is cleanest however to use all of these workers through the contracting agency for a while (assume we don't want to hire them all which is the other alternative). Then the company may want to make selected offers to people who may be in a managerial role or have some other distinction from the bulk of the contract workers. I would like additional information on this situation before reaching a definitive conclusion. So let's try to discuss it. I am booked until about 11 this morning but am available after that. Michelle Hoyt Thomas@ENRON 08/08/2000 04:21 PM To: Michelle Cash/HOU/ECT@ECT cc: Melissa Laing/LON/ECT@ECT Subject: Priviliged and Confidential communication to my attorney Re: Henry Bath LA Michelle I guess emails will get to you sooner if I remember to add you to the addressee list! Sorry. Hoyt ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Latest Documents Body:: ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CONFIDENTIAL Attached file Body:: This is the negative CTC claim. Transmission and other charges we owe have been set off ie this is a net amount and the gross CTC is much larger- on the order of $900MM. Decision to use or not is not final in Enron keep confidential. The potential witness would be Wanda Curry. Thanks Ray ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Confidential - GSS Organization Value to ETS Body:: I agree with Morris What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: CONFIDENTIAL Personnel issue Body:: Great. That is exactly what I would like you to do. Michelle What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: HELP!!! Body:: Linda - I haven't heard of these guys. Do you know them? ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ORG CHART Body:: I do not. Enron Energy Services From: Deborah DeFforge 07/18/2000 08:34 AM Phone No: 713.853.9474 713.646.2621 - Facsimile EB1293 To: Steven J Kean/HOU/EES@EES Richard Shapiro/HOU/EES@EES cc: Subject: ORG CHART Do either of you have an updated org chart depicting EES ENA and EBS? Thank you! d2 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Power of Communication Program Body:: More info. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: UC-CSU-Enron press release Body:: I know we got a lot of grief on the Hill when we had our fight with UC/CSU. Now we have settled and this release will go out (with some modification) today. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Report on ""Anti-RTO Bill"" and on Andy Black Meeting Body:: This note is to report on two electricity legislative developments: the Aug. 2nd introduction of an anti-RTO bill (or at least anti-mandatory RTOs) and on a meeting I had yesterday afternoon with Andy Black the policy coordinator for Chairman Joe Barton on the House Energy and Air Quality Subcommittee to discuss their intentions with respect to electricity legislation this Fall. 1. H.R. 2814 (Reps. Tom Sawyer (D-OH) and Richard Burr (R-NC)) On Aug. 2nd (the last day Congress was in session before the August Recess) the above named members of the House Energy and Air Quality Subcommittee introduced H.R. 2814 the Interstate Transmission Act. The legislation is bad because among other things it requires FERC to establish transmission pricing policies that provide incentives for voluntary participation and formation of RTOs with language prohibiting policies that have the effect of forcing transmitting utilities to join RTOs. Also objectionable is that the bill would limit pancaking but at the same time require FERC to establish a reasonable transition mechanism or period for additive charges. The legislation prohibits FERC from conditioning any order upon a transmitting utility being required to transfer operational control of jurisdictional facilities to an ISO or RTO. The bill would require that participating transmitting utilities must approve the form structure and operating entity of any RTO. In addition to the RTO language the bill has the old version of the NERC reliability legislation in it. The bill also has a PUHCA exemption for RTOs repeals Federal Power Act sec. 203 on the disposition of property and includes the tax changes that IOUs seek for transfers of property to an independent transmission company. Barbara Hueter advises that First Energy has its hq in Rep. Sawyer's district. Rep. Burr is from North Carolina so perhaps Duke had its utility hat on in working with him. I am checking into where Duke is on this issue. Rep. Burr is the Vice Chairman of the House Energy and Commerce Committee and close to Chairman Tauzin -- so his support for this legislation is significant (see Andy Black comment below). 2. Andy Black Meeting Andy is meeting with various trade associations this month to discuss electricity legislation. He is only meeting with a few companies on a one-on-one basis -- Enron Reliant Dynegy and TXU. His timing is to have a legislative draft for Chairman Barton to review when Congress returns after Labor Day. If Chairman Barton approves or makes changes the draft will be circulated to members of the subcommittee and the public for further comment. The intent is to mark up an electricity bill this Fall so that if the Senate acts on electricity in its comprehensive energy bill the issue will be ripe for consideration in a House-Senate conference committee. Here is a run down of my comments and Andy's comments on specific issues. a. RTOs Chairman Barton supports RTOs. At a minimum the draft will affirm FERC's authority as the commissioners have requested. Andy is considering going beyond that to mandate RTO participation. Not sure he can hold that position in the subcommittee. He is looking to Enron and others to help them explain and build support for RTOs. Informed him of our initial informal coalition steps. However Andy asked me to look at sec. 3 of the Sawyer-Burr referenced above which I realized after the meeting is the part that deals with incentive rates and negotiated rates to expand transmission and voluntary RTOs. I have a call in to Andy to reconcile these statements since the Sawyer-Burr bill is based on voluntary RTOs. Hopefully he is thinking of using the incentive and negotiated rate language and NOT the objectionable voluntary RTO aspects. I will strongly encourage him to do the right thing in that regard. b. PUHCA The draft will use the Pickering bill (H.R. 1101). Told Andy about our concerns with the record keeping provisions of that bill. Will send him our legislative language to clarify these provisions so that they do not open up all of Enron's records -- even those unrelated to transactions with a regulated utility affiliate. c. PURPA Prospective repeal. On back up power they are thinking of requiring that rates for back up power be just and reasonable until there is retail competition in the state. d. Interconnection They have received a proposal from Trigen that Andy says we will like. I am contacting EPSA to get the details. e. Net Metering They are likely to include the Inslee bill to require net metering. I explained our concern that the bill's mandate applies to all retail energy suppliers -- including EES -- even though this should only apply to utilities with an obligation to serve that it does not make sense to mandate it on service providers like EES (per Jim's helpful comments yesterday). I need to get more information to Andy. f. Transmission Jurisdiction Thankfully Andy is NOT going to use those portions of the bill as reported by subcommittee in the last Congress that gave use heart burn on jurisdiction. Specifically the draft will not say FERC does not have jurisdiction over the transportation component of a bundled retail sale -- the draft will not get into the bundled/unbundled issue at all. The draft will bring munis co-ops and PMAs under the FERC umbrella for transmission jurisdiction purposes. g. Siting On siting Andy is thinking of some type of mechanism that would give a State one year before federal eminent domain attaches. h. Reliability On a negative note Andy intends to use the latest NERC reliability language because NERC's version has strong support among the Members of the subcommittee and no other alternative has emerged with political support (i.e. not PJM). I explained our concerns. He said our best bet is for DoE or FERC to come forward to seek something other than the NERC version. He said Members eyes glaze over on reliability with everything else on the plate. i. Negawatts I raised the absence of negawatts on his issue list. He said he is open to considering it again but that there was left over political baggage and unresolved issues from when this was attempted during consideration of the California bill earlier this summer. Your questions and comments on the any of the above are most welcome. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ashoks all-day staff meeting today. Body:: Eric (713) 464 1955 Steve Williams PGE information for Boise What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: ISOs Response to BPA Rebuttal of Sheffrin Study--Confidential Atty Client work product Body:: I recommend reading CAISO's response. This letter was reported in last week's trade press. I am told that BPA does not consider this letter confidential even though it is labeled as such by CAISO. Many of the CAISO backpedal statements made re: claims of strategic bidding would apply equally to other importers. Alan Comnes What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Meeting of the Energy Services Coalition (ESC) Enron Task Force, Houston, TX, Friday, 1/14/00 Body:: I will be out of town that day (a meeting I can't move). Please continue to let me know about future meetings. Lora Sullivan@ENRON 12/16/99 03:25 PM To: Steven J Kean/HOU/EES@EES Steven J Kean/HOU/EES@EES Terence H Hap Boyd/EWC/Enron@Enron John Jose Rob Bradley/Corp/Enron@ENRON Aleck Dadson/TOR/ECT@ECT Carolyn Green/HOU/AZURIX@AZURIX Chris Long/Corp/Enron@ENRON Mac David Peter Styles/LON/ECT@ECT Scott Bolton/Enron Communications@Enron Communications cc: rcfisher@hillsandco.com Subject: Meeting of the Energy Services Coalition (ESC) Enron Task Force Houston TX Friday 1/14/00 Enron Task Force Member At the call of Joe Hillings we plan to hold a meeting of the ESC Enron Task Force in Houston on Friday 1/14/00 from 8:00 AM until Noon. We would like to have dinner at a Houston restaurant on 1/13/00 @ 7:00 PM. If you are able to attend all or part of the meeting please advise. Details on dinner and Enron Building room location to follow. Joe Hillings RSVP to Lora Sullivan: John Ambler ___ Jose Bestard ___ Scott Bolton ___ Hap Boyd ___ Rob Bradley Yes Aleck Dadson ___ Carolyn Green ___ Chris Long ___ Mac McClelland ___ David Merrill ___ Peter Styles ___ Terry Thorn ___ cc: Bob Fisher (Would you be available to attend this meeting?) EJH What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Kari Dohn 916.445.0114 Body:: TASK ASSIGNMENT Task Priority: 2 Task Due On: Task Start Date: What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Rick to Cover Body:: LTV Steel's Northern Ohio Energy Conference in Cleveland Ohio You will be on a panel with reps from Centerior Ohio Edison Cinergy Audience will be between 400-500 ppl Per Terrie James What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Funky Business Body:: Follow up to previous message: I would not have managing for the slow down on the agenda. I don't think it is as relevant to our business as it is to many others. TERRIE JAMES@ENRON COMMUNICATIONS 07/05/2001 01:09 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Funky Business Steve Have you had a chance to look at the book Funky Business and to give any thought to having Jonas present at the Management Conference? I know you have a thousand other things on your plate not the least of which is California so I understand if the answer is no. However they've been contacted by someone else about the date so we may be forced to decide rather soon. On a related subject I'm contemplating another topic for the conference. I'd seen an article in Fortune several months ago titled Managing for the Slowdown. It talked about new challenges managers face in light of the economic downturn. (Most young managers have never experienced anything but boom times.) The article also outlines a dozen or so things companies should be thinking about now. (Use the downturn as a new opportunity to evaluate people. Overhaul your budget process. Don't stop communicating. etc.) I think it would be beneficial to address similar strategies and ideas with our managers. I'd love to get your thoughts on this idea. (Is it appropriate for Enron or am I just seeing the world through bleak-colored glasses?) Terrie James Sr. Director Corporate Communication Enron Broadband Services 713-853-7727 (phone) 713-646-8887 (fax) terrie_james@enron.net What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Meeting with Mayor Willie L. Brown, Jr. Body:: I think it would be a good idea for them to talk but I wouldn't want Jeff to go to California right now. Maybe they could meet outside the state (if for example brown is going to be in DC or New York) or by phone. From: Joannie Williamson/ENRON@enronXgate on 07/13/2001 08:36 AM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron cc: Subject: FW: Meeting with Mayor Willie L. Brown Jr. Wanted you to be aware that Mayor Brown is inviting Jeff to meet with him either in San Francisco or elsewhere. Please advise but I know that Jeff would probably not travel to California. Mark Koenig and Andy Fastow will discuss meeting with Mayor Brown on the CalPERS issue. Thanks Joannie What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Privileged & Confidential -- Verification Body:: Thanks for your help. Linda J Noske 09/18/2000 05:52 PM To: Richard B Sanders/HOU/ECT@ECT cc: Subject: Re: Privileged & Confidential -- Verification Richard I got the fax confirmation back that it went through. I put it in your in-box since you were with the interviewee. Linda Richard B Sanders 18/09/00 05:32 PM To: Linda J Noske/HOU/ECT@ECT cc: Subject: Privileged & Confidential -- Verification What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - General Expenses Body:: ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: FW: Possible co-sponsorships Body:: Though I had a somewhat different notion when I initially raised the idea of co-sponsorship I agree with Lee's observations and think that we should proceed the way he suggests. gramlr@pjm.com on 08/29/2000 04:06:56 PM To: amosher@appanet.org hcameron@uclink.berkeley.edu lfried@uclink.berkeley.edu jeff.dasovich@enron.com cc: Subject: FW: Possible co-sponsorships All Lee asked me to forward this. I'm still awaiting additional suggestions from anyone on speakers. I guess Lee's e-mail changes things. If the business school wants to go forward with a conference anyway then it may be a bad idea to have a separate one. Jeff has said he likes the idea of coordinating. Bill and Allen what do you think? I will chime in that Carl Shapiro is very much a big wig as a former chief economist at DOJ. As for the Frank Wolak suggestion Frank is a Stanford economist who is an outstanding analyst and has published probably more than anyone else on electricity market design performance regarding the UK Australia and California. He speaks a mile a minute though and his understanding of policy and politics is a bit naive. I should note that ICF will not be able to contribute. I heard from Michael Berg this morning. So he will not be participating in our discussions either. My opinion is let's do whatever is best for the school. One positive outcome of this would be stronger relationships with some of the University's top notch economic policy faculty. Overshadowing is possible. Lee does Dean Nacht have a view on joint sponsorship? Rob > What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Sorry I had saved your list for the Europe AA PRC and didn't include them in my draft of the memo. I am sending another version shortly that has that information included. I don't think I need anything more from you unless you have other comments on the memo. Thanks What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron projects with OPIC financing Body:: OPIC information. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: call to Sen Kinder Body:: Ken talked to Sen Kinder. He made the points you had prepared. Kinder agreed to shelve the legislation for this session. He said he had been hearing from several others including Proctor and Gamble (which has a big facility in his district) that the legislation was not going to help competition develop in the state. He expressed willingness to work with us on a better package and also expressed interest in coming to Enron's offices. He is going to be in San Antonio in August and would like to come to Houston around that time. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ATTORNEY CLIENT PRIVILEGDE - Draft FERC Brief on Settlement Process Body:: My suggestions are attached. Take the gloves off. James D Steffes 07/06/2001 10:04 PM To: Jeffrey T Hodge/Enron@EnronXGate Robert C Williams/Enron@EnronXGate cc: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Alan Comnes/Enron@EnronXGate Jeff Dasovich/NA/Enron@Enron Susan J Mara/NA/Enron Robert Frank/NA/Enron@Enron Ray Alvarez/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON dwatkiss@bracepatt.com Subject: ATTORNEY CLIENT PRIVILEGDE - Draft FERC Brief on Settlement Process The attached is a rough draft of a potential filing Enron would make in to Judge Wagner in the Settlement process (it is unclear if this would remain confidential per the gag order). Please provide Ray Alvarez your comments. This would be filed as early as Monday am. Jim What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Form 4 Reminder for April Body:: do I need to do anything? I believe the only transaction I had was related to a set of shares which were released to me earlier in the year. Some of the shares were sold at that time to pay the income tax on the distribution. We discussed this before and my recollection is I did not have to make a filing. Could you confirm by e-mail? ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Notice of CPUC gas infrastructure workshop Body:: fyi What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: New MSC Committee Report Body:: All: I just downloaded the attached from the ISO's website. It is dated 12/1/00= . =20 To boil it down the MSC comes down against soft caps and recommends the= =20 get market-based rates in return for selling forward proposal that the IS= O=20 staff is pushing. Forward contracts would need to at rates that=20 approximate competitive prices. Based on my quick read that does not mea= n=20 market prices it means somthing more akin to cost of service. MSC also=20 wants there to be a penalty on generators for underscheduling. They also= =20 claim there proposal will not exacerbate reliability problems. I would be interested in people's opinion if Enron should be responding to= =20 this report. Given the date of the report I am not sure if/how the ISO=20 would file this at the FERC. G. Alan Comnes (GAC) Here's the list of recommendations from the report. (1) The PX =01&must-buy=018 requirement would become a =01&must-schedule=01= 8 requirement.=20 IOUs would be required to schedule all forward energy through the PX but would = be=20 free to purchase it from any source. (2) California generators and entities that sell to any California purchase= r=20 (not limited to the PX and ISO) could continue to be eligible for market-based rates (and would= =20 be free of refund obligations) only if they offer a substantial portion of their sales= =20 in the form of two-year contracts at rates that approximate competitive prices. The detail= s=20 of such a proposal are outlined in this report. The volume offered by sellers in the= =20 aggregate would be sufficient to cover the all three IOUs=01 residential and small= =20 commercial customer load using an average load profile for weekdays and weekends for= =20 each month. (3) Any market participant that does not offer these two-year=20 market-power-mitigation forward contracts would be subject to cost-of-service rates for all of thei= r=20 sales of energy and ancillary services into the California market for at least the two-year= =20 market power mitigation period. (4) The CPUC would be encouraged to set a default rate for IOU residential= =20 and small commercial customers based on projected wholesale energy costs under the=20 2-year contracts described above. (5) The under-scheduling penalty should be even-handed. The MSC recommends = a=20 real-time trading charge that is applicable both to load and generation and more=20 important does not distinguish between instructed and uninstructed deviations from schedul= e. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PanNat Value - Confidential and Proprietary Body:: Jeff Per your request below is the value of the deal based on MID prices as of Friday June 28. We have also estimated the Bid/Offer costs at $30 million based upon several quotes we received last year. Let me know if you have any questions. Regards Eric What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Sen. Murkowski to Address USAEE Conference, Sept. 25 Body:: Cynthia get back to Jeff on this. It doesn't look like a high priority to me but I will absolutely defer to your judgment. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Duke release and news conference Body:: ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PGE/Commercial Support Group Meeting, 32C1 Body:: Per Geoff Roberts What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Congressman Ose loved your letter to Sen. Dunn Body:: ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Two Governors Press Releases--More Courage from the Capitol Body:: Preempt me please! Jeff Dasovich@EES 09/13/2000 06:22 PM To: Mary Hain/HOU/ECT@ECT Joe Hartsoe/Corp/Enron@ENRON Cynthia Sandherr/Corp/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Paul Kaufman/PDX/ECT@ECT Sandra McCubbin/SFO/EES@EES Mona L Petrochko/SFO/EES@EES Susan J Mara/SFO/EES@EES James D Steffes/HOU/EES@EES mpalmer@enron.com Karen Denne/Corp/Enron@ENRON Richard Shapiro/HOU/EES@EES Steven J Kean/NA/Enron@Enron cc: Subject: Two Governor's Press Releases--More Courage from the Capitol ----------------- What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Calling All Investors: The New Power Companys IPO Priced at $21 Per Share Body:: Do you guys follow these reports? Do we need to correct them? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: CAISO NOTICE: Market Surveillance Committee Nominations and Selection Process Body:: MARKET NOTICE November 6 2001 Market Surveillance Committee Nominations and Selection Process ISO Market Participants: The MSC Selection Committee is currently accepting nominations (including self-nominations) for the two vacant Market Surveillance Committee (MSC) positions. The MSC Selection Committee is comprised of Frank Wolak Chair of the MSC Severin Borenstein Director of the Energy Institute at the University of California and Anjali Sheffrin the ISO's Director of Market Analysis. The selection committee will conduct an extensive review of each candidate's independence and qualifications and compose a short recommendation list for the two additional member positions on the MSC. In order to meet the goal of presenting a final recommendation list of 5 candidates to the ISO CEO by December 21 2001 from which the ISO CEO will select the two candidates for ratification as new members by the Governing Board on January 24 2002 all nominations need to be submitted to the MSC Selection Committee by November 21 2001. Please review the attached documents for more information. <> <> Client Relations Communications CRCommunications@caiso.com What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ken Lays Meeting with Fox Body:: Jon -- Ricardo Charvel is pulling together the briefing for Ken so please share the EBS activities/ agenda with him. Thanks ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: NewPower Withdrawal Notes Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Important - CPUC Motion - Confidential Attorney ClientPrivil ege and Work Product Body:: While I appreciate the virtue of flying below the radar if possible the matter here is complicated by the fact that FERC's discovery rules (18 CFR Subpart D) pertain only to proceedings set for hearing . . . and to such proceedings as the Commission may order. 18 CFR 385.401. In this case FERC stated that a trial-type hearing is not necessary . . . . and specifically rejected the use of a trial-type evidentiary hearing. Slip op. at 47-48 & n.97. Thus while I have not researched the matter as yet my preliminary view is that the CPUC's attempt to invoke FERC's discovery processes would appear to be outside the contemplation of FERC's Nov. 1 order and its regulations unless FERC specifically orders discovery in this case. (The CPUC seems to recognize the relevance of this consideration when it specifically attempts to equate paper hearings with trial-type hearings see page 1 of its Motion.) The CPUC's motion may prompt FERC to decide whether or not to allow discovery in this case under Rule 401. While the CPUC's motion does not apply directly to marketers FERC's ruling will be precedent in the event the CPUC or someone else hereafter serves discovery on other parties. As a result we need to consider whether laying in the weeds risks losing an opportunity to present our views on whether FERC should allow discovery in a paper hearing with an expedited decisional track particularly in light of the fact that Staff has already conducted. >>> Jeffrey Watkiss 11/08/00 10:31AM >>> Does anyone have an idea as to why marketers including EPMI are not included in the list of subject companies: Exh. B? Since EPMI is not a subject of the motion why should it answer? Lying in the weeds may be a more prudent course of action. >>> Fergus Gary S. 11/07/00 10:08PM >>> I just spoke with Mary to make sure we have the same information. Here are the facts we have so far. On November 4th the CPUC filed a motion with FERC to adopt the form of protective order that the CPUC entered to compel the production of documents and to shorten time to answer. According to Exhibit B (read to me by Nancy Pickover at Bracewell) the following CPUC moved against the following entities: AES Williams Duke Dynegy Reliant and Southern. Enron entities were NOT named in exhibit B. This is not to say that we could not be easily added to the group. While the motion reads as if the CPUC was moving against everybody in fact in footnote 2 they state they are only moving against the entities named in Exhibit B. We will have Exhibit B in hand first thing tomorrow via FEDEX to confirm this. To repeat Enron is not named yet. Thanks Gary What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EEI Conference Series on RTOs and Markets: Mark Your Calendars Body:: Should we (or ESCA) start looking for opportunities like this now to get the word out? ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: I'll give 150. Enron Capital & Trade Resources Corp. From: Jeff Skilling 04/19/2001 05:18 PM Sent by: Sherri Sera To: Cliff Baxter/HOU/ECT@ECT Rick Buy/HOU/ECT Ben Glisan/HOU/ECT@ECT Steven J Kean/NA/Enron@Enron Jeffrey Sherrick/Corp/Enron Philippe A Bibi/HOU/ECT Michael Brown/NA/Enron Wade James A Hughes/ENRON_DEVELOPMENT Louise Kitchen/HOU/ECT@ECT Rebecca McDonald/ENRON_DEVELOPMENT Greg Piper/Corp/Enron John Sherriff/LON/ECT@ECT Greg Whalley/HOU/ECT@ECT Janet R Dietrich/HOU/EES@EES Mark S Muller/HOU/EES@EES Matthew Scrimshaw/LON/ECT@ECT David Cox/Enron Communications@Enron Communications Kevin Hannon/Enron Communications@Enron Communications Rod Hayslett/FGT/Enron Stan Horton/Houston/Eott@Eott Danny McCarty/ET&S/Enron@Enron cc: Subject: I know how incredibly busy you all are so I'm sure that making a pledge to Jeff for the MS150 has simply slipped your mind. Well the ride is this weekend time is running out and we need you! Enron's goal is to raise $700000 and Jeff's personal goal is to raise $50000. As of today we are a little better than half way there. Won't you consider helping him reach his goal? Thanks for your consideration. I look forward to hearing from you tomorrow... Sherri :-) What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:GRIFFITH JOHN Email:john.griffith@enron.com - 713-853-6247 ? Enron Wholesale Services - Office of the Chairman ? From:??Mark Frevert Chairman & CEO ??????Greg Whalley President & COO ??????Mark Haedicke Managing Director & General Counsel ? Subject:??Confidential Information and Securities Trading ? Enron Wholesale Services ('EWS') maintains official Policies and Procedures Regarding Confidential Information and Securities Trading ('Policies and Procedures') which have been revised as of November 15 2000 to reflect the new EWS structure. These policies and procedures are intended to allow us simultaneously to pursue our diverse businesses and to protect confidential information our reputation for integrity and EWS and its employees from legal liability. ? You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: ? ? You must certify your compliance with the Policies and Procedures within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Lance Schuler at extension 3-5419 Mark Haedicke at extension 3-6544 Alan Aronowitz at extension 3-3214 Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Barton Talking Points Body:: Here are Barton talking points per our conversation last night. We will separately send a favorable Washington Post article on FERC's meeting yesterday as it relates to RTOs. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Portal Body:: Attached are some late night thoughts on the portal. Most of this is focussed on the portal for opinion leaders but some of it could be applicable to the comemrcial portal as well. Could you forward this to Palmer ... for some reason my address book doesn't pull him up when I'm off the system. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: More Than Words Body:: Dear Jeff There aren't any corporate speak words that can express what I feel so I will use plain English: I am thrilled that I will be working for you at Enron. I look forward to helping you and your team continue to transform Enron into the number one company in the world and into the best company in the world. I have sent my bio to Steve Kean and will send him my list of my preferred California contacts. By mid-week I will send you a cleaned-up version of the suggestions I outlined in our meeting. I look forward to the next steps. It is an honor to be working with you again. I pledge to you my very best. Sincerely [IMAGE] Contact Information E-mail kevinscott@onlinemailbox.net Phone (213) 926-2626 Fax (707) 516-0019 Traditional Mail PO Box 21074 ?Los Angeles CA 90021 - image001.png - image002.gif What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential - Voicemail Messages Body:: These were the messages in your voicemail: 1. 10/18/01 - Margaret Allen ....needed your advice on whether her sister should take job with Cal-Pine or Kinder Morgan 2. 10/19/01 - Adrianne Engler ....regarding candidantes that you were suppose to phone interview. (you have sent her an email since this) 3. 10/23/01 - Bob Shults(X3-0397)....they met with Nymex last week and are getting ready send the proposal ont eh document you saw last week. He wants to make sure that you are okay with this and dont have any issues. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Depart 1:05/Arrive 2:41 Body:: Meet with Commissioner Ebert in Biloxi - Confirmed 7/1/97 Contact is Paige - 601-436-4833 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Challenge to exercise of Eminent Domain - Confidential Attorney Work Product Body:: USA: UPDATE 1-Calif. seizes stranded SoCal Edison energy contracts. 02/02/2001 Reuters English News Service (C) Reuters Limited 2001. SAN FRANCISCO Feb 2 (Reuters) - California Gov. Gray Davis on Friday blocked the California Power Exchange from liquidating stranded energy contracts held by cash-strapped utility Southern California Edison seizing the assets for the state. The governor's office said the order issued late on Thursday and put in effect on Friday was needed to preserve the contracts' value for power-starved California consumers. I am using my emergency powers to seize options to buy very inexpensive power that would otherwise be lost forever Davis said in a statement. These options will provide reliable power through the end of the year. It is important to protect these contracts for the people of California he said. A Los Angeles judge on January 24 issued a temporary injunction valid for a week blocking the exchange's sale of the contracts. The California Power Exchange (CalPX) said Davis' order nullified a Los Angeles County Superior Court decision earlier Friday that authorized CalPX to liquidate Edison's forward market positions. The exchange said they had sought to liquidate the contracts to recover about $255 million that Edison has failed to pay to CalPX market participants. While agreeing to transfer the contracts to the state the exchange pointed out that the law requires that California pay a reasonable value for them which it estimated at nearly $652 million on today's market. Delivery of the first contracts which total 2.8 million megawatt hours is scheduled to begin Monday February 5. One megawatt hour is roughly the amount of electricity needed to light 1000 homes for 60 minutes. Davis is desperately seeking cheap power for the state after the utilities' financial meltdown pushed them to the market's sidelines. Spot market purchases for the state are currently being made by the Department of Water Resources but at typically higher prices than in the forwards market. Block forward energy contracts secure electricity deliveries over a given block of time at a price agreed months in advance shielding the buyer from the kind of price volatility that has recently roiled the short-term spot market. The overall value of SoCal Edison's contracts agreed last year for power to be delivered in 2001 was not immediately known but CalPX officials said last month they hoped their liquidation would cover the $215 million SoCalEdison owned the exchange. SoCal Edison the utility subsidiary of Rosemead Calif.-based Edison International has warned it is no longer able to meet its financial obligations after running up a debt of nearly $5 billion buying wholesale power in the spot market where prices have soared ten-fold over the past few months amid a regional energy shortage. The utility is blocked by the state's 1996 deregulation law from passing these high wholesale prices down to consumers who are still protected by a rate freeze. That same deregulation legislation created the CalPX making it the state-sanctioned exchange for electricity trading. SoCal Edison was among the biggest buyers on the exchange. CalPX crushed by a mountain of debt it is unable to recover from Edison has shut its spot market operations and is winding down its business affairs. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Houston City Officials Reception - July 31st Body:: We don't know yet. He has been invited and we expect most will show up but we won't know until they do. Enron Energy Services From: Karen Owens 07/20/2000 09:04 AM To: Steven J Kean/HOU/EES@EES cc: Subject: Re: Houston City Officials Reception - July 31st Is Gordon Quan attending? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: fyi Body:: Please send to the distribution list ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: NYTimes.com Article: The Real Wolf Body:: Please respond to vkaminskiThis article from NYTimes.com has been sent to you by vkaminski@aol.com. /-------------------- advertisement -----------------------\ Looking for better IT solutions? Toshiba is uniting digital mobile and network innovations in a bold new vision of Information Technology for today and tomorrow. Take a closer look at life in the new Digital Age. And imagine how good IT can be. Visit Toshiba.com for more details. The Real Wolf RECKONINGS By PAUL KRUGMAN ecently I received a letter from an economist I respect chiding me for my Naderite columns on the California energy crisis. He just didn't believe that market manipulation by power companies could possibly be an important issue it sounded too much to him like the sort of thing one hears from knee-jerk leftists who blame greedy capitalists for every problem be it third-world poverty or high apartment rents. The left has cried Wolf! so many times that sensible people have learned to discount such claims. But now a bona fide wolf has arrived whose predatory behavior is doing terrible damage to our most populous state - and nobody will believe it. True California would be heading for a summer of power shortages even if it had never deregulated. And even if there was workable competition in the wholesale electricity market prices in that market would spike during periods of peak demand transferring billions of dollars from either taxpayers or consumers to the generators. But the evidence is now overwhelming that there isn't workable competition in California's power market and that the actions of generators gaming the system have greatly magnified the crisis. The key fact is that California has somehow remained in a state of more or less continuous power shortage and very high wholesale prices regardless of the level of demand. A rash of outages has kept the electricity market conveniently - and very profitably - short of supply even during periods of low demand when there ought to be lots of excess capacity. As Frank Wolak the Stanford economist who also advises the state's power grid has pointed out an outage at a power plant is a lot like an employee calling in sick. You can't tell directly whether he is really sick or has chosen to take the day off for other reasons but you can look for circumstantial evidence. And such evidence has convinced Mr. Wolak that generators use forced outages strategically to withhold capacity from the market - a view shared by a growing number of other researchers. Which brings us to the latest move by the Federal Energy Regulatory Commission. On Wednesday the commission apparently decided to offer California some relief and put new price caps in place on the California electricity market. I say apparently because the more you look at the plan the less likely it seems to be any help at all. Indeed the measure was passed on a 2-to-1 vote with William Massey - the one commissioner who has been sympathetic to calls for price controls - voting against it on the grounds that it would be ineffectual. What's wrong with FERC's plan? First it caps prices only in emergency conditions - ignoring the fact that electricity prices have stayed at hard- to-explain levels even when there is no emergency. In effect the plan is laid out as if the electricity market were really competitive in spite of all the evidence that it is not. Second even those emergency price caps are full of loopholes offering extensive opportunities for what Mr. Wolak calls megawatt laundering - selling power to affiliated companies that for one reason or another are exempted from the price controls (for example the controls do not apply to imports from neighboring states) then selling it back into the California market. Severin Borenstein of the University of California Energy Institute adds that because the allowed price depends on the cost of generation at the least efficient plant generators will have a clear incentive to produce inefficiently: I predict we will find some plants we never heard of before that are suddenly operating again and they will be pretty inefficient. The general verdict seems to be that this is not a serious plan. There are serious proposals to mitigate the crisis out there - indeed last fall Mr. Wolak submitted a proposal that was well received by other experts - but FERC has ignored all of them. The charitable interpretation is that FERC still doesn't get it that it just can't bring itself to believe that this time the wolf is real. The uncharitable interpretation is that last week's action was meant to fail. The Medley Report an online newsletter calls the FERC plan a grand exercise in posturing without substance . . . a very clever temporary move by the Bush administration to deflect any political fallout from the looming disaster. Whatever the explanation the plain fact is that FERC and the administration have yet to offer California any significant relief. Visit NYTimes.com for complete access to the most authoritative news coverage on the Web updated throughout the day. Become a member today! It's free! http://www.nytimes.com?eta HOW TO ADVERTISE For information on advertising in e-mail newsletters or other creative advertising opportunities with The New York Times on the Web please contact Alyson Racer at alyson@nytimes.com or visit our online media kit at http://www.nytimes.com/adinfo For general information about NYTimes.com write to help@nytimes.com. Copyright 2001 The New York Times Company What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Annual Meeting Q&A Body:: Currently an announcement is scheduled for mid may so there may be more public information available then. In the meantime I would answer the question as follows: Enron will continue to focus its attention on the commercial light manufacturing and industrial end user markets. Enron continues to explore opportunities to serve the residential market and we believe that the market presents opportunities that were not available even a couple of years ago (for example the rising acceptance of online purchasing by consumers presents low cost customer acquisition and account management possibilities that didn't exist when Enron last moved into residential markets). We believe however that the residential market opportunity is best pursued through a separate entity outside of Enron Mary Clark@ENRON 04/20/2000 02:31 PM To: Steven J Kean/HOU/EES@EES Maureen McVicker/HOU/EES@EES cc: Subject: Annual Meeting Q&A Steve we need to include a potential question in the Q&A document that addresses if Enron will get back into the residential business (i.e. Resco). Could you provide an answer to this question. I need by end of biz Monday. Thanks. Mary What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: NXE Energy CNRS (French Agency) Confidential Executive Summary Report Body:: Attention: Mr. Kenneth L. Lay. Chairman & CEO Enron Energy Houston Dear Mr. Lay: Please find the attachment of the NXE Energy Executive Summary Report prepared by Dr. M. X. Francois The Director of the Fluid Mechanics Laboratory of the French National Scientific Research Agency (CNRS). The Submission of this and all other information is of course confidential. The report combined with conversation's held with Dr. Francois recommends that because of the success of the Alpha Prototype testing we should proceed with an Industrial Beta model with certain modification's to the circuit piping system design and insert a turbine and generator after completing sizing and a designed computer model. Again wishing you and Enron the best NXE Energy David Taylor Co-Founder & CSO Telephone (toll free) 877 696-0800 Cell Phone : 415 722 2846 - cogen_exec_sum4.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Lay/Skilling Talking Points for Bush Admin Meetings and Calls Body:: To add to what Rick said I would add that effective DSM requires that price signals be sent to customers AND customers have the ability to repond -- even Mr. I See Market Power Under Every Bush Dr. Frank Wolak has as one of his key solutions -- competitive retail markets. Sue Mara Enron Corp. Tel: (415) 782-7802 Fax:(415) 782-7854 Richard Shapiro 04/04/2001 11:07 AM To: Linda Robertson/NA/Enron@ENRON cc: Steven J Kean/NA/Enron@Enron Joe Hartsoe/Corp/Enron@ENRON Tom Briggs/NA/Enron@Enron James D Steffes/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Janine Migden/NA/Enron@Enron Jean Ryall/NA/Enron@ENRON Aleck Dadson/TOR/ECT@ECT Ricardo Charvel/NA/Enron@Enron Jeff Dasovich/NA/Enron@Enron Susan J Mara/NA/Enron@ENRON Jose Steve Montovano/NA/Enron@Enron Subject: Re: Lay/Skilling Talking Points for Bush Admin Meetings and Calls I think these are quite good...the missing piece I would argue that we need to include is a talking point on the need for FERC to focus significant resources on the identification and elimination of market power in electricity markets and the need to encourage the development of distributed generation and more effective demand - side response mechanisms partly in response to market power concerns. This is a huge issue in getting wholesale electricity markets to work effectively i.e to create discernable consumer welfare benefits.... and we ( Enron ) need to talk about this this issue and concern and talk about it frequently and w/ the same passion we talk about the need for open markets. Linda Robertson 04/04/2001 12:09 PM To: Steven J Kean/NA/Enron@Enron cc: Richard Shapiro/NA/Enron@Enron Joe Hartsoe/Corp/Enron@ENRON Tom Briggs/NA/Enron@Enron Subject: Lay/Skilling Talking Points for Bush Admin Meetings and Calls Steve per our conversation yesterday in Houston what do you think of these TPs? To be used by both Ken and Jeff in conversations and meetings with the Bush Administration. - Skilling Talking Points.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Senate May Mark Up Electricity Title Next Week Body:: I have received confirmation from Senate staff that the Senate Democrats on the Energy Committee met this morning and tentatively decided to go along with Chairman Bingaman's desire to move up the mark up of the electricity title from later this month as earlier expected to next Thursday Sept. 13. They are not sure they can do it all in one day. Acting on 9/13 as desired now depends on the reaction of the committee's Republicans. Not sure they will cooperate with moving quickly. I am on my way to the Senate for an RTO meeting and expect to obtain a copy of the draft electricity language implementing the Bingaman White Paper the language was just distributed to committee members this afternoon but I understand that Bingaman's staff had worked on it behind the scenes with Comr. Massey. Will advise once I have it hand. John What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Mid Year PRC Meetings Body:: for meeting file ----------------- What should this email be categorized as? [/INST] Empty message (due to missing attachment) " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Meeting with Debra Body:: Anne That's great. The meeting is at 3:00 in or area on th 19th. Vince What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Follow-up from Meeting with Andy Black Body:: Jim -- Please see attached from EPSA on their meeting today with Andy Black Chairman Barton's chief energy adviser. I have my own one-on-one with Andy at 4 pm tomorrow. Would you have a minute to read the EPSA memo and a list that Andy sent me (which I will forward separately) and we could chat about these issues tomorrow before the 4pm -- just so I have everything in perspective going into the meeting? I am open to any time tomorrow except 10 am (EDT). Please let me know. Thanks. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Hi, Body:: Jinbaek Great I look forward to working with you. Please call me during the next few days (713) 853 3848 and we can chat about the projects. Please contact Molly Magee to talk about the first day orientation program. Her E-mail address is molly.magee@enron.com and her phone number is (713) 853-4804. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Important - CPUC Motion - Confidential Attorney ClientPrivil ege and Work Product Body:: Does anyone have an idea as to why marketers including EPMI are not included in the list of subject companies: Exh. B? Since EPMI is not a subject of the motion why should it answer? Lying in the weeds may be a more prudent course of action. >>> Fergus Gary S. 11/07/00 10:08PM >>> I just spoke with Mary to make sure we have the same information. Here are the facts we have so far. On November 4th the CPUC filed a motion with FERC to adopt the form of protective order that the CPUC entered to compel the production of documents and to shorten time to answer. According to Exhibit B (read to me by Nancy Pickover at Bracewell) the following CPUC moved against the following entities: AES Williams Duke Dynegy Reliant and Southern. Enron entities were NOT named in exhibit B. This is not to say that we could not be easily added to the group. While the motion reads as if the CPUC was moving against everybody in fact in footnote 2 they state they are only moving against the entities named in Exhibit B. We will have Exhibit B in hand first thing tomorrow via FEDEX to confirm this. To repeat Enron is not named yet. Thanks Gary What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Congressional Hearing in S.D. on the 11th Body:: Could you work with Allison to get the needed information to cathy. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Black Mesa Pipeline Co Body:: fyi ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:TAYLOR MARK Email:mark.taylor@enron.com - 7138537459 Enron Wholesale Services - Office of the Chairman From: Mark Frevert Chairman & CEO Mark Haedicke Managing Director & General Counsel Subject: Confidential Information and Securities Trading To keep pace with the fluid and fast-changing demands of our equity trading activities Enron Wholesale Services (EWS) has recently revised its official Policies and Procedures Regarding Confidential Information and Securities Trading (Policies and Procedures). These revisions reflect two major developments: (1) our equity trading activities have been extended into the United Kingdom and (2) in an effort to streamline the information flow process the Review Team will play a more centralized role so that the role of the Resource Group is no longer necessary.You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: If you have already certified compliance with the Policies and Procedures during the 2001 calendar year you need not re-certify at this time although you are still required to to review and become familiar with the revised Policies and Procedures. If you have not certified compliance with the Policies and Procedures during the 2001 calendar year then you must do so within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RTO Meeting With Chairman Barton Body:: Late yesterday afternoon EPSA's legislative affairs committee (about 10 of us) met with Chairman Barton and staff to discuss his draft RTO language. Meeting lasted 45 minutes. Interestingly no one was there from either Reliant or El Paso. We had what the diplomats would call a frank exchange of views. Can't say we moved Barton very much if at all except we did have a chance to go over the staff to point out specific flaws in the draft even based on his view of how RTOs should come about (I gave several very specific examples like the 40000 MW provision and other limits on FERC discretion on size and scope as well as procedural rights for transmission owners but not the rest of us etc.). Chairman Barton's fundamental view is that Congress not FERC should determine how RTOs come about. And that the market and the industry should determine how RTOs are shaped etc. not FERC. He bristled at one point and said he had more faith in us than he had in FERC or we had in ourselves to determine how RTOs come about going so far as to saying that under his draft they would be our RTOs -- meaning those of us present. I pointed out this is wrong because under his draft the transmission owners particularly those least likely to join up would have all the leverage. I said that the basic flaw in the draft is that it assumes there are only two parties to the transaction -- FERC and transmission owners -- forgetting the rest of us including consumers. He said we could become transmission owners if we wanted to!!! On the 40000 MW size minimum he said many experts had advised them this is the correct number. We said that putting a number in to the statute ran counter to his oft-stated desire for a fair process to produce RTOs driven by market forces not regulators. The two elements of good news -- Barton reconfirmed that a markup this year is very unlikely AND he expressed that he would not spend too much time on electricity next year if it started to crowd out other issues like Clean Air Act Amendments and nuclear waste legislation. This suggests a strategy possibility in terms of running out the clock. He said he has the votes by a wide margin to report the RTO draft but will entertain some changes. He said the only reason he has not marked up the bill is that the Sept. 11th terrorist attacks have taken attention away from the issue and subcommittee members are not engaged on the issue. He said those of us who support could roll the dice with them but that there are things that only Congress can do -- like getting all transmission owners into RTOs -- and that these statutory changes are so important that we should not oppose the draft. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FERC ""Linda Breathitt"" Strategy Contact Body:: Zausner is kind of a mixed bag. I think he's strong intellectually and has some influence but I don't trust him to keep our strategy and contacts confidential. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Greening the Enron Building Mtg Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: The Governors Natural Gas Summit: Responding to the Challenge Body:: Yes thanks. Lay is going to be giving the keynote. It may be a hard story to assemble: the gas market is deregulated and structured pretty much the way we would like to see it done in both gas and power markets yet we still have high prices. It's a bit of a stretch to blame it all on OPEC. I'm interested in any views you may have. David Haug@ENRON_DEVELOPMENT 09/01/2000 10:30 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: The Governors' Natural Gas Summit: Responding to the Challenge I assume you are involved in this but just in case... - - -DLH ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Havamann Litigation PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT COMMUNICATION Body:: I am in London this week and will be meeting with David Best on Thurs to discuss. Thanks for your inquiry. I'll let you know after the meeting. Gail Brownfeld@ENRON_DEVELOPMENT 01/30/2000 10:45 AM To: Richard B Sanders@ECT cc: Robert C Subject: Havamann Litigation PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT COMMUNICATION Richard Did your office get everything it needed from David Best to do the wire transfer of the settlement funds? Is there anything you need us to do on the remaining bit of the claim against the underwriters? I believe you all have retrieved the whole file however let me know if there is anything we can do to help. I will be in the UK during the week of February 14 if there is something I can do while I'm there let me know. Thanks. GAIL What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EES Staff Meeting, in 791 - per Julies cc:Mail on 9/5 Body:: EES Budget meeting ? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Fri 7/27: Hopes dim for a quick Edison deal SD Union Fri 7/27: Sempra's trading unit generates a windfall LA Times Fri 7/27: Smog Rules May Be Eased LA Times Fri 7/27: Federal Caps Didn't Deter Higher Prices SF Chron Fri 7/27: Calpine profits double on skyrocketing sales Escalating power prices inspire plant building program SF Chron Fri 7/27: Generators continue to set high electricity prices SF Chron Fri 7/27: THE ENERGY CRUNCH Environmental suit against power plant Expansion called danger to slough OC Register Fri 7/27: Let's make a real deal with Edison (Editorial) LA Times Fri 7/27: California Sempra Continues Improved Results LA Times Fri 7/27: California Calpine Doubles Earnings Beats Forecasts Energy: San Jose-based company credits higher electricity prices in California and sales from new plants LA Times Fri 7/27: Cap No Bar to Higher Prices Power: Cal-ISO study says suppliers continued to charge as much as five times more than the U.S.-imposed limits WSJ Fri 7/27: Calpine Net Soars On Added Plants Sempra Profit Rises Hopes dim for a quick Edison deal By Kevin Yamamura Bee Capitol Bureau (Published July 27 2001) The Assembly will not return this week to consider a plan to save California's second-largest utility from bankruptcy all but ending hopes that legislation would reach Gov. Gray Davis by a mid-August deadline. A group of legislators and Davis staffers has worked this week on an agreement that would restore Southern California Edison's credit and relieve the state of having to purchase energy for the utility. Assembly leaders who convened the group set an ambitious schedule that would have led to a vote today had they reached consensus and been able to recall enough of the 80 Assembly members from summer recess destinations. But the newly formed plan which would issue $2.9 billion in consumer-backed bonds in exchange for several Edison concessions remains too rough for a vote said Paul Hefner a spokesman for Assembly Speaker Robert Hertzberg D-Sherman Oaks. Hefner was quick to note that Hertzberg has the Assembly on call for the scheduled monthlong break and is prepared to ask members to return if a deal comes in the next three weeks. But staff and lawmakers said earlier that organizing a mass return after today would prove nearly impossible because Assembly members are expected to travel throughout the state and beyond. Davis set an Aug. 15 deadline in his original Edison deal and recently said he could call a special session forcing legislators to return if they do not authorize a plan by then. His spokesman Steven Maviglio said Thursday the governor is not ruling out that idea but is waiting to see what comes of further legislative discussions. It's pretty clear that everyone's working pretty hard to form a consensus but they're just not there Maviglio said. The governor is optimistic about the Aug. 15 date. Even so Edison does not expect a solution by then. Company officials stated earlier this week that they would wait for a political deal at least until lawmakers return Aug. 20. The Bee's Kevin Yamamura can be reached at (916) 326-5542 or kyamamura@sacbee.com Sempra's trading unit generates a windfall \ objattph By Craig D. Rose UNION-TRIBUNE STAFF WRITER July 27 2001 Sempra Energy the parent company of SDG&E reported a 25 percent surge in profit to $137 million last quarter but said yesterday it lost money on the sale of electricity under a long-term contract to California. On the other hand Sempra said its largest source of profits was its energy trading unit a middleman that earned $69 million during the quarter buying and selling energy produced by others. The results underscore the transformation of relatively simple utility companies into diversified energy holding companies that have learned to profit in new ways from the deregulation of electricity and the turmoil in energy markets. The surprising announcement -- that a company lost money selling power during California's run-up in electricity prices -- was explained by Sempra as an intentional consequence of the long-term contract it signed with the state to provide power. Stephen Baum chairman and chief executive officer of Sempra said the company agreed to provide a steep discount to California during the summer months but would recoup the losses later in the 10-year deal. California sought long-term electricity purchase contracts so it could reduce its purchases in daily and near-term power markets where prices reached record levels. Critics say Gov. Gray Davis rushed into long-term deals because of concerns about getting through next year's election. They also say the contracts will saddle customers with higher costs for years. The governor has acknowledged that long-term contracts might cause consumers to pay relatively high prices for electricity in later years but he maintains it is a fair price to pay for lowering prices that were devastating the state economy. Michael Shames executive director of the Utility Consumers' Action Network in San Diego said the steep discount Sempra provided to the state on power this summer raised questions about the governor's proposal to help San Diego Gas & Electric Co. clear a debt of $750 million. SDG&E says it is owed that money for power purchases on behalf of its customers. In a media conference last month Davis said the agreement would eliminate the threat of a possible balloon payment for consumers who he said might have faced the so-called balancing account debt as early as next year. Shames says the proposal which took the form of a memorandum of understanding or MOU is costly for consumers and a bonanza for Sempra. He said the relatively cheap power provided by Sempra this summer makes the MOU sound like more of a hidden payback to Sempra than a real relief plan for local ratepayers. Shames said he will release an analysis of the state's Sempra plan next week. The state Public Utilities Commission is expected to rule on the plan in August. A Sempra spokesman said there is no connection between discount power and the tentative agreement to clear the $750 million debt. Doug Kline the Sempra spokesman said the power contract with the state was signed in early May and the agreement on the balancing account was reached in mid-June. Sempra Energy Trading meanwhile said only 10 percent of its $69 million profit was earned from sales of energy in the western region which includes California. The trading operation earned $40 million in profit during the comparable period last year. California's Independent System Operator which manages most of the state power grid and other investigators have said trading and bidding strategies were tools used by energy companies to raise prices during the California power crisis. Though Sempra earned money on trading its wholesale power generating business lost $9 million during the quarter. Baum said the discounts on electricity provided the state were the prime cause of the loss for Sempra Energy Resources but added that a plant outage also contributed. Sempra Energy Resources which co-owns a generating plant near Las Vegas with Reliant Energy earned $2 million during the second quarter last year. Baum added that Sempra's long-term contract with the state -- under which it will provide up to 1900 megawatts -- has allowed its wholesale business to pre-sell about half the power it expects to generate from the Nevada plant which will be expanded and three generating facilities it expects to build. Profits at SDG&E slipped to $37 million during the quarter ended June 30 down from $40 million last year according to Sempra. SDG&E whose business is restricted to delivering gas and electricity said it provided increased customer service during the crisis which lowered profits. Wall Street analysts generally applauded Sempra's results noting that the company was ahead of its plan to generate at least a third of its profits from its newer businesses by 2003. They're really two years ahead of schedule for their non-utility businesses said Brian Youngberg an analyst with Edward Jones & Co. Bud Leedom a San Diego-based analyst with Wells Fargo Van Kasper said Sempra's move into energy trading now seems shrewd. We never dreamed they were setting themselves for a windfall like this Leedom said. Investors pushed Sempra shares up 17 cents yesterday to close at $25.49 in trading on The New York Stock Exchange. Bloomberg news service contributed to this report. Smog Rules May Be Eased Power plants: EPA proposes a sweeping change in how utilities' emissions are curbed a flexible approach favored by the industry. By GARY POLAKOVIC and ELIZABETH SHOGREN Times Staff Writers July 27 2001 WASHINGTON -- U.S. Environmental Protection Agency Administrator Christie Whitman proposed sweeping changes Thursday in the regulation of power plant pollution that would replace five of the government's toughest programs with a single flexible approach favored by utilities. Whitman outlined a plan for cleaning up major components of power plant smog that represents a significant departure from the EPA's traditional regulatory dictums. She called for a major expansion of pollution credit trading which up to now has had varying success. Under the new plan the EPA would scrap some of the most stringent measures devised by the agency to deal with power plant emissions. One provision to be set aside aims to cut harmful mercury emissions another is meant to reduce emissions from Midwestern power plants by 85% another is designed to restore visibility at national parks. Especially unpopular with industry one measure known as new source review requires the installation of advanced pollution controls whenever power plants are expanded or modified. It too would be phased out. New source review is certainly one of those regulatory aspects that would no longer be necessary Whitman told Sen. George Voinovich (R-Ohio) at the hearing by the Environment and Public Works Committee. All of those [programs] could be aligned into one regulatory process that she said would work better than existing rules. Whitman's comments offer the first peek into the administration's plans for cleaning some of the dirtiest polluters left in the nation. Debate over the administration's clean-air approach has shifted to Congress as it considers whether to revise the national Clean Air Act. The magnitude of the proposed revisions caught environmentalists by surprise but buoyed industry representatives who say existing controls are costly and inefficient. She has raised an appalling prospect of junking virtually every rule and strategy to deal with emissions of electric companies in return for some vague industry-sought plan for an emissions trading scheme said Frank O'Donnell executive director of the Clean Air Trust an environmental advocacy group. If they go forward with this it means a wholesale fight over the Clean Air Act in Congress. After the hearing Whitman stressed that the overall goal is to clean the air more efficiently than current rules do. Although the administration has not yet released a so-called multipollutant cleanup strategy Whitman contended that collapsing several regulations into one far-reaching approach would be easier for regulators and industry to manage. What we're looking for is targets under this legislation that significantly clean up the air beyond what our current regulatory statutory requirements would do Whitman said. She added that new source review for example could potentially be no longer necessary if you have the right kind of targets set in a multi-emissions bill. We have to wait and see where the targets are set. Utilities have lobbied Vice President Dick Cheney's energy task force to prevent the EPA from aggressively enforcing the new source review regulation. Industry and administration officials say the provision is onerous and prevents plant upgrades although EPA officials say it is a key tool for forcing dirty old plants to cut emissions by up to 95%. During the Clinton administration federal officials charged that 32 coal-fired power plants in several Southern and Midwestern states ignored a requirement that companies install advanced emission controls when their plants were upgraded. The government reached settlement with three utilities but a provision in the Bush administration's energy plan stalled those enforcement actions pending a review of power plant controls. C. Boyden Gray attorney for the Electric Reliability Coordinating Council and former White House counsel for the first President Bush in the 1980s praised the administration's proposal. He said major utility companies he represents including Southern Co. Duke Energy Co. and the Tennessee Valley Authority could clean up with greater flexibility and less cost under the plan outlined by Whitman. To put everything in a market-incentives basis is a great step. It would be a real breakthrough and a plus for the business community Gray said. For example Gray said EPA has four separate measures to control nitrogen oxides from power plant combustion including programs to cut acid rain ozone and haze. Another program scheduled to take effect in May 2004 requires power plants in 19 states to cut summer emissions by 1 million tons annually. He said those programs can be confusing and costly and could easily be replaced by a credit-trading program run largely by power companies. Under the program being considered by the Bush administration an emission limit could be established at hundreds of power plants followed by annual reductions in mercury a toxic metal as well as smog-forming nitrogen and sulfur oxides. However a provision to reduce carbon dioxide a gas implicated in global warming was dropped under industry pressure. Power companies that reduce beyond their limits could sell emission credits which represent a pound of pollution to companies that exceed their limits. Although industry and free-market advocates favor such programs they are not without controversy. The record of market-driven programs is mixed. On the one hand the nation's acid rain program uses marketable permits and is widely credited with cutting sulfur oxides at less cost. On the other hand the world's first market-driven program to tackle urban smog has not worked in Los Angeles where nearly 400 power companies and manufacturers failed to achieve significant cleanup for the nearly eight years the program has been in effect. Further many environmental groups are wary of market-driven programs because by design they preclude active government intervention. Critics say such programs could potentially limit public review of power plant operations allow emissions to concentrate in poor communities and slow efforts to cut haze in national parks downwind from plants that elect to buy pollution credits instead of cleaning up. The Bush administration's power plant strategy was aired before the Senate Environment and Public Works Committee which is chaired by Sen. James M. Jeffords (I-Vt.) whose dramatic departure from the GOP threw control of the Senate to the Democrats. Jeffords is proposing legislation different from the administration's approach that would control four power plant pollutants including the greenhouse gas carbon dioxide an approach rejected by the Bush administration. Prospects appear to be increasing that Congress will pass one or more measures designed to reduce carbon dioxide emissions a belated response to this week's decision by more than 180 countries to deal with the problem without the involvement of the United States. Indeed in recent weeks several members in the GOP-led House and Democratic Senate have voted on bills with the intention of disassociating themselves from President Bush's environmental policies before the next election. Among the votes the House struck down a provision supported by the Bush administration that could hinder progress on global climate change policy. The Senate banned new coal mining and oil and gas drilling in national monuments. Other recent rebuffs included rejections of administration initiatives on such issues as the Endangered Species Act hard-rock mining regulations and offshore drilling for oil and gas. Copyright 2001 Los Angeles Times Federal Caps Didn't Deter Higher Prices Power: Cal-ISO study says suppliers continued to charge as much as five times more than the imposed limits. By NANCY VOGEL TIMES STAFF WRITER July 27 2001 SACRAMENTO -- After federal regulators limited wholesale electricity prices last month big private sellers of power in California continued to ask as much as five times more for electricity than the federal cap according to a confidential study by state grid operators. The analysis by the California Independent System Operator covers only the first week after the caps were imposed June 20. Cal-ISO has submitted the data to federal regulators for potential investigation. The report is a summary of what Cal-ISO calls possible anti-competitive behavior by Duke Energy Williams Cos. Mirant Corp. Reliant Energy and Dynegy Corp. In a truly competitive market we would expect these suppliers to bid very close to their actual operating cost said Greg Cook senior policy analyst with Cal-ISO's Department of Market Analysis. The state did not necessarily purchase any power at the high prices being demanded. Instead the significance of the bids is that they show how California could find itself paying exorbitant prices for electricity again if hot weather returns and conservation slackens said Frank Wolak a Stanford University economist who studies the California electricity market. The bottom line is that the generators are putting out these bids in expectation of high demand he said. If weather all of a sudden gets really hot from Southern to Northern California the bids submitted by generators could be very costly to California. Cal-ISO calculated the cost of production for each company based on the efficiency of its power plants and estimates of what each paid for natural gas to fuel the plants. The average cost for the five was $105 per megawatt-hour which closely matches the federal price limit in California which now stands at $101 per megawatt-hour. According to the power bidding procedures companies that bid at or below their cost of production often still get paid a higher price allowing them to make a substantial profit. On average four of the five companies submitted bids either slightly below or slightly above their cost of production. But with the exception of Atlanta-based Mirant each company at times submitted bids that were substantially higher. Houston-based Reliant for example bid as much as $540 per megawatt-hour more than five times its estimated cost. Overall Reliant's average bid was close to costs according to the analysis. Cal-ISO identified companies by code in its report. Sources familiar with the study identified the companies for The Times. The Cal-ISO report singled out Supplier 5 identified by sources as Charlotte N.C.-based Duke Energy saying the company continues to bid significantly in excess of its operating costs. Duke owns two large power plants on the central coast. It marked up its bids an average of 88% beyond its cost to produce electricity according to the analysis. For example it cost Duke $85 to $121 to generate a megawatt-hour of electricity in the time period studied the report shows but the company offered to sell a megawatt-hour from $149 to $195. Duke spokesman Tom Williams on Thursday said The use of the data in some cases doesn't appear to add up and in all cases appears to be selective and could easily be misunderstood. Duke sells nearly the entire output of its power plants under long-term contracts and not on the spot market which the Cal-ISO report studied he noted. Reliant spokesman Richard Wheatley said We're looking at the data and we question whether or not it is correct. A combination of cool weather heavy conservation the start-up of new power plants and recently signed long-term power contracts that guarantee supplies have eased the state's electricity crisis in recent weeks. Market prices that as recently as May averaged $271 per megawatt-hour have dropped to less than $100 per megawatt-hour. The more abundant power supplies have freed grid operators to ignore higher-priced bids. But they will have to consider paying such prices to avoid blackouts if supplies tighten Wolak said. Such a scenario would test the effectiveness of the Federal Energy Regulatory Commission order issued June 19 he said. The bids of the five companies analyzed were offers of sales to Cal-ISO a Folsom-based agency that manages the electrical transmission grid serving 75% of California. Cal-ISO buys power on short notice to smooth the flow on the state's electrical freeway and avert blackouts. As California's fledgling market began to go haywire last fall Cal-ISO workers struggled to purchase as much as 30% of the state's power demand with just hours to spare. Since then the market has stabilized and Cal-ISO's purchases now amount to roughly 5% of the electricity California consumes. RELATED STORY Power profits: Power plant operator Calpine said its quarterly profit more than doubled. C2 Copyright 2001 Los Angeles Times Calpine profits double on skyrocketing sales Escalating power prices inspire plant building program Carolyn Said Chronicle Staff Writer Friday July 27 2001 2001 San Francisco Chronicle URL: BU234287.DTL> Fueled by high electricity prices power generator Calpine Corp. reported strong second-quarter results yesterday. Calpine of San Jose said profit for the quarter ended June 30 almost doubled to $107.7 million (32 cents per share) from $59.5 million (20 cents) during the year-ago quarter. Revenue almost quadrupled to $1.61 billion from $417.2 million a year ago. Excluding charges related to the acquisition of Canada's Encal Energy Calpine's net income was $132.2 million (39 cents) well above the 31 cents per share predicted by analysts according to Thomson Financial/First Call. Calpine is on an ambitious path to expand its roster of generating plants. By the end of 2005 it expects to have 75000 megawatts in operation in the United States including 12000 megawatts in California. A megawatt is about enough power for 1000 homes. The company which generates 2428 megawatts in California this summer opened the state's first two major power plants in a decade. The new plants in Yuba City (Sutter County) and Pittsburg generate 547 and 555 megawatts respectively. Combined with a new plant in Arizona that sells power to California Calpine's new facilities helped the state stave off threatened blackouts this summer Chief Executive Officer Peter Cartwright said. Calpine is building the 847-megawatt Delta Energy Center in Pittsburg scheduled to open in May and a 750-megawatt plant in Kern County due in June 2003. It is also awaiting an August decision by the California Energy Commission on its proposed 600-megawatt Metcalf Energy Center in San Jose. California is a very good market for us said Bill Highlander a Calpine spokesman. The pricing in California has benefited Calpine. However he said the company was not one of the traders that focused on making top dollar in California's volatile spot market because its business model concentrated on selling electricity through long-term contracts. During the past few months Calpine signed 10-year and 20-year contracts with the state for as much as 2500 megawatts at prices ranging from $58.60 to $73 per megawatt hour. With most of its plants fired by natural gas Calpine wants to control about a quarter of the gas it uses Highlander said. Its April purchase of Encal Energy for $1.77 billion more than doubled its gas reserves to about 1. 7 trillion cubic feet equivalent according to Hoover's Online. Calpine's stock closed up $1.08 at $36.89 yesterday. E-mail Carolyn Said at csaid@sfchronicle.com 2001 San Francisco Chronicle Page B - 1 Generators continue to set high electricity prices Friday July 27 2001 2001 Associated Press URL: 0359EDT0121.DTL> (07-27) 00:59 PDT LOS ANGELES (AP) -- Power wholesalers continued to demand higher prices for energy despite federal regulation that capped electricity rates according to a confidential report by the California Independent System Operator. In one case an energy company charged as much as five times more for electricity than the federal cap which were imposed June 20. State grid operators have given the study to federal regulators for a possible investigation the Los Angeles Times reported Friday. Five companies were identified by code in the report and sources familiar with the study named the wholesalers for the Times. They include Duke Energy Dynegy Corp. Mirant Corp. Reliant Corp. and Williams Cos. The average price charged by the five power companies was $105 per megawatt-hour which closely matches the federal price limit in California set at $101 per megawatt-hour. Four of the five companies submitted bids either just below or just above their cost of production. Houston-based Reliant however asked as much as $540 per megawatt-hour in some cases. Overall the company's average bid was close to costs the report said. The state wasn't required to purchase power at the rates set by wholesalers but the bids reflect a potential repeat of charging exorbitant electricity prices if temperatures soar and conservation dwindles said Frank Wolak a Stanford University economist who studies the California electricity market. The bottom line is that the generators are putting out these bids in expectation of high demand he said. If weather all of a sudden gets really hot from Southern to Northern California the bids submitted by generators could be very costly to California. The Cal-ISO report singled out Duke Energy noting it continues to bid significantly in excess of its operating costs. The report shows the company's cost to produce electricity was between $85 and $121 but it offered to sell a megawatt-hour from $149 to $195. Cal-ISO calculated the cost of production for each company based on the efficiency of its power plants and estimates what each paid for natural gas to fuel the plants. The use of the data in some cases doesn't appear to add up and in all cases appears to be selective and could easily be misunderstood said Duke spokesman Tom Williams. 2001 Associated Press THE ENERGY CRUNCH Environmental suit against power plant Expansion called danger to slough Christian Berthelsen Scott Winokur Chronicle Staff Writers Friday July 27 2001 2001 San Francisco Chronicle URL: MN236840.DTL> An environmental group filed suit yesterday to overturn a permit granted to Duke Energy Co. to expand a major power plant south of Santa Cruz. Saying the permit was illegally awarded the suit warns that the resulting project will damage the ecologically important Elkorn Slough. Voices of the Wetlands accuses the board that awarded the permit of violating federal law by not requiring Duke to use the best possible technology to minimize impacts on the environment around the Moss Landing power plant. If plans to expand the plant proceed without change the group said it would kill off critical organisms at the bottom of the food chain. The suit filed in Monterey County against the California State Water Resources Control Board and the regional board that serves the central coast seeks a court order to return the case to the regional water district so that more environmentally sensitive cooling technology can be ordered for use at the plant. State officials said yesterday that the issues raised in the suit were considered and rejected during the initial permit approval process last year and again during the appeal process this year. The case comes amid enormous pressure on state officials in light of California's energy crisis to rapidly accelerate power plant approvals and expand the amount of power generation available. Against this backdrop the state water board on June 21 essentially rejected environmental groups' appeal that had sought to overturn the district board's decision approving the Moss Landing expansion permit. On another front board members of the California Energy Commission took testimony earlier this week on a proposal to curtail public review of plant project proposals with one board member Robert A. Laurie acknowledging in an interview that he believed in some cases it posed one of the most time- consuming aspects of project approval. A recommendation is expected within the next month. Duke of Charlotte N.C. bought the Moss Landing plant from Pacific Gas & Electric Co. in 1998 when the Northern California utility sold off many of its facilities to prepare for deregulation of the energy market. The plant was built in 1950 using a cooling system technology that sucks water out of the Elkorn Slough and Monterey Bay to cool generating turbines before spitting the water out into the Pacific Ocean. The group says wildlife conditions and sea otter population have improved markedly since PG&E mothballed many of the generating units at Moss Landing in 1995. But Duke now is proposing to resurrect parts of the cooling system in a major expansion that will make Moss Landing the state's largest power plant after its completion next summer. With an output of 2538 megawatts the plant when completed is expected to account for 30 percent of all new electricity generated in California next year serving about 2.5 million households in the Monterey Santa Cruz and southern Santa Clara County areas including San Jose. Regional water quality board officials declined comment yesterday citing the pending litigation. But in public documents filed yesterday water officials said cooling alternatives had been considered and rejected. The documents did not elaborate on why they were not mandated. Duke had acknowledged during the process that more ecologically sensitive technologies were available but at prohibitive costs of $20 million to $50 million more. Deborah Sivas an attorney for the Earthjustice Environmental Law Clinic which filed the suit on behalf of Voices of the Wetlands considered the best technology alternatives mandatory not optional. She said the board had not considered alternative approaches in reaching its conclusions. E-mail the writers at swinokur@sfchronicle.com and cberthelsen@sfchronicle.com 2001 San Francisco Chronicle Page A - 3 Let's make a real deal with Edison July 27 2001 By JONATHAN LANSNER The Orange County Register When any government official tries to play business executive it's time to get nervous. Take the Edison bail out as evidence. At its essence the deal works like this: Taxpayers give the utility a big pile of cash the state gets some old rickety transmission lines in return. Don't be fooled: The power bounty is basically a political ploy. The state doesn't need to control electric distribution. What politicos need is a face-saving trade as evidence that this is a business deal - not a government handout. The state probably should just write the check and eat its losses. But if bureaucrats wanted real remuneration from this bail out California would eye some juicy Edison assets. As a public service I'll list a few. Now for argument's sake I won't differentiate between the utility and its parent company Edison International. Hey lawyers built those walls between the two. Let 'em figure out how to take 'em down. For starters you'd figure an energy-strapped state would like some regional power plants no? Like the San Onofre facility. However it might be laughable to see Sacramento-types defending their future handling of the local nuclear plant. OK if that's a tad too dicey for the state how about a coal-fired plant in Nevada? Heck Edison had a buyer at half a billion bucks before the state oddly quashed that deal. Maybe the state could grab it from Edison -- then flip it to pay off electricity-related debts. Of course buying one of the out-of-town power plants that Edison's sister company in Irvine has acquired might be educational for Sacramento. Owning a plant in Illinois or Pennsylvania or possibly New Zealand might show state honchos how easy - or not - it is to rig supply and prices. Alternatively the state could demand a small entity called Edison Capital. Basically it's a bank. One specialty: the politically correct field of affordable-housing lending. A good fit for bureaucrats. Speaking of money there's the Edison pension plan. Governments are really good at running retirement benefits. Heck California already has a huge one. There's got to be some economies of scale - real cash savings - in merging the Edison plan with some state pension fund. Do note that Edison's plan might be overfunded by about $400 million. You can bet though that the state would never have the nerve to play 1980s corporate raider: profiting by grabbing some of a company's overfunded retirement kitty. Finally there's Edison International Field in Anaheim. Stadium naming-rights contracts must have some value since corporations always seem to fight over these promotional gimmicks. (The utility's parent company paid $50 million in 1997 for two decades of free publicity.) Imagine the buzz the state could get out of the huge sign age on a nationally renowned stadium. Plus maybe the Angels could be good corporate citizens and tie into this deal. It's possible they'd allow a slight change in the team name to better emphasize the state's role in the ballpark. So how does California Angels sound to you? Business Financial Desk California Sempra Continues Improved Results NANCY RIVERA BROOKS 07/27/2001 Los Angeles Times Home Edition Page C-2 Copyright 2001 / The Times Mirror Company Sempra Energy on Thursday reported another quarter of higher earnings and revenue a sharp contrast to California 's bigger and beleaguered investor-owned utilities. Although California 's electricity crisis has pushed Southern California Edison and Pacific Gas & Electricity into insolvency--and PG&E into U.S. Bankruptcy Court--the parent of San Diego Gas & Electric and Southern California Gas continues to post improved results on the strength of its non-utility businesses. Net income for the period ended June 30 rose 25% to $137 million or 66 cents a share up $25 million or 55 cents earned a year ago the San Diego-based utility holding company said. Revenue jumped 40% to $2.1 billion. Pretax operating income rose 24% to $291 million. Sempra's earnings came in just ahead of the 65-cent average estimate of analysts surveyed by First Call/Thomson Financial. Our strong second-quarter performance is primarily the result of our efforts to accelerate growth through new businesses Stephen L. Baum Sempra's chairman chief executive and president told analysts in a conference call. Sempra is in a vastly different position than Edison International and PG&E Corp. because its electric utility arm was able to avoid the deep financial woes afflicting their respective Southern California Edison and Pacific Gas & Electric utilities. SDG&E was first to sell its power plants two years ago and thus was freed from a rate freeze. That in turn allowed the utility to pass along to customers the soaring costs of electricity beginning last summer. The state Legislature eventually rolled back and capped the rates for SDG&E customers but promised the utility it would be allowed to recover those losses. Edison and PG&E however continued to accumulate staggering debts because their retail rate freezes remained in place. In contrast Sempra is solvent with $1.5 billion in cash and $1 billion in available credit Baum said. The performance of its utilities was lackluster with Southern California Gas earning $47 million unchanged from the second quarter of 2000 and SDG&E earning $37 million down from $40 million in the year-ago period. But Sempra's unregulated businesses--including energy trading power plant construction and operation international electricity operations and energy services--turned in an overall strong performance contributing 39% of the parent company's earnings. Sempra's trading unit provided most of that profit contributing $69 million to second-quarter net income compared with $40 million in the same quarter last year. Sempra's stock gained 17 cents to close at $25.49 on the New York Stock Exchange. Business Financial Desk California Calpine Doubles Earnings Beats Forecasts Energy: San Jose-based company credits higher electricity prices in California and sales from new plants. 07/27/2001 Los Angeles Times Home Edition Page C-2 Copyright 2001 / The Times Mirror Company Calpine Corp. one of the biggest U.S. power-plant builders said Thursday that second-quarter earnings more than doubled beating estimates because of higher electricity prices in California and sales from new plants. Profit from operations rose to $132.2 million or 39 cents a share from net income of $59.5 million or 20 cents a year earlier. Revenue almost quadrupled to $1.61 billion. San Jose-based Calpine opened plants in the U.S. with a combined capacity of 1545 megawatts--enough to light 1.5 million average homes--and benefited from existing plants in California . Calpine has insulated itself from rising fuel costs by buying natural-gas fields to supply its plants. Given the strategy they have chosen they're following through quite well said Andre Meade an analyst at Commerzbank Capital Markets Co. They are growing from a small base and adding a lot of plants so we'd expect high growth. Profit topped the 31-cent average estimate of analysts surveyed by First Call/Thomson Financial. Calpine said it expects to earn $2 a share this year. The average First Call forecast was $1.92 with a range of $1.80 to $2.04. Calpine's shares rose $1.08 or 3% to close at $36.89 on the New York Stock Exchange. The shares had fallen 21% this year amid concern that generators might have to give back some of the profit they made selling power in California during the last year. In addition cooler-than-normal weather and conservation efforts recently reduced power prices in the state. Calpine runs or is building natural gas plants in 29 U.S. states and Canada that produce more than 30000 megawatts of power. The company plans to more than double capacity to 70000 megawatts by the end of 2005. Calpine this month opened the $350-million Sutter plant California 's first major generator in more than a decade. The company is building 11 plants to run during times of peak demand in the state and getting permits for four more James Macias who oversees Calpine's West Coast power plants said in a conference call with analysts and investors. Separately Arlington Va.-based AES Corp. a power producer that supplies California and operates in 27 countries said second-quarter profit fell 20% because of losses tied to currency fluctuations and the sale of a U.S. electricity retailer. Net income fell to $112 million or 21 cents a share from $140 million or 28 cents a year earlier. Sales rose 26% to $2.21 billion. California Metro Desk Cap No Bar to Higher Prices Power: Cal-ISO study says suppliers continued to charge as much as five times more than the U.S.-imposed limits. NANCY VOGEL 07/27/2001 Los Angeles Times Ventura County Edition Page B-1 Copyright 2001 / The Times Mirror Company SACRAMENTO -- After federal regulators limited wholesale electricity prices last month big private sellers of power in California continued to ask as much as five times more for electricity than the federal cap according to a confidential study by state grid operators. The analysis by the California Independent System Operator covers only the first week after the caps were imposed June 20. Cal-ISO has submitted the data to federal regulators for potential investigation. The report is a summary of what Cal-ISO calls possible anti-competitive behavior by Duke Energy Williams Cos. Mirant Corp. Reliant Energy and Dynegy Corp. In a truly competitive market we would expect these suppliers to bid very close to their actual operating cost said Greg Cook senior policy analyst with Cal-ISO's Department of Market Analysis. The state did not necessarily purchase any power at the high prices being demanded. Instead the significance of the bids is that they show how California could find itself paying exorbitant prices for electricity again if hot weather returns and conservation slackens said Frank Wolak a Stanford University economist who studies the California electricity market. The bottom line is that the generators are putting out these bids in expectation of high demand he said. If weather all of a sudden gets really hot from Southern to Northern California the bids submitted by generators could be very costly to California . Cal-ISO calculated the cost of production for each company based on the efficiency of its power plants and estimates of what each paid for natural gas to fuel the plants. The average cost for the five was $105 per megawatt-hour which closely matches the federal price limit in California which now stands at $101 per megawatt-hour. According to the power bidding procedures companies that bid at or below their cost of production often still get paid a higher price allowing them to make a substantial profit. On average four of the five companies submitted bids either slightly below or slightly above their cost of production. But with the exception of Atlanta-based Mirant each company at times submitted bids that were substantially higher. Houston-based Reliant for example bid as much as $540 per megawatt-hour more than five times its estimated cost. Overall Reliant's average bid was close to costs according to the analysis. Cal-ISO identified companies by code in its report. Sources familiar with the study identified the companies for The Times. The Cal-ISO report singled out Supplier 5 identified by sources as Charlotte N.C.-based Duke Energy saying the company continues to bid significantly in excess of its operating costs. Duke owns two large power plants on the central coast. It marked up its bids an average of 88% beyond its cost to produce electricity according to the analysis. For example it cost Duke $85 to $121 to generate a megawatt-hour of electricity in the time period studied the report shows but the company's bids ranged from $149 to $195 per megawatt-hour. Duke spokesman Tom Williams on Thursday said The use of the data in some cases doesn't appear to add up and in all cases appears to be selective and could easily be misunderstood. Duke sells nearly the entire output of its power plants under long-term contracts and not on the spot market which the Cal-ISO report studied he noted. Calpine Net Soars On Added Plants Sempra Profit Rises By Rebecca Smith 07/27/2001 The Wall Street Journal Page B4 (Copyright (c) 2001 Dow Jones & Company Inc.) Calpine Corp. reported net income nearly doubled in the second quarter reflecting the independent power producer's aggressive plant-building program. Meanwhile the parent of a San Diego utility said profit rose 25%. Calpine of San Jose Calif. said net was $107.7 million or 32 cents a share up from $59.5 million or 20 cents a share a year earlier. The latest results which were in line with analysts' expectations included a special charge of seven cents a share related to Calpine's purchase of Encal Energy Ltd. a natural-gas company. Revenue grew even more strongly soaring to $1.61 billion from $417.2 million. Separately Sempra Energy parent of electric utility San Diego Gas & Electric reported profit rose to $137 million from $110 million a year earlier. Revenue jumped 40% to $2.1 billion from $1.5 billion. Sempra Chairman Steve Baum attributed the growth which stands in marked contrast to the financial woes of California 's other electric-utility-owning energy companies to Sempra's unregulated operations. Calpine's profit increased despite paying substantially more for natural gas to fuel its plants. It spent an average of $4.80 per million British Thermal Units for natural gas up from $3.31 a year before. At the same time Calpine's revenue per megawatt hour of electricity sold also rose to $71.03 in the latest period from $64.80 a year earlier. At Sempra Mr. Baum said profit from Sempra's biggest utility unit San Diego Gas & Electric fell 7.5% to $37 million from $40 million. Results were flat at its gas-distribution company Southern California Gas Co. Sempra Energy Trading was the big profit center generating half its total profit or $69 million compared with $40 million a year earlier. Mr. Baum said Sempra's stock which trades at a low price/earnings multiple of 10 still is being affected negatively by the California situation. He also said the company made less money in spot-power markets than in prior quarters but nevertheless intends to invest $2 billion in new power plants. In 4 p.m. New York Stock Exchange composite trading Calpine shares rose $1.08 to $36.89 while Sempra climbed 17 cents to $25.49. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: PLEASE READ & RESPOND Body:: Yes. Contact either Gia or John and get the ball rolling. Thanks Michael Terraso 08/18/2000 04:20 PM To: Steven Kean cc: Maureen McVicker=20 Subject: PLEASE READ & RESPOND Steve I received this note from Jeff Keeler who is on the government affai= rs=20 distribution list. Would you also want the EHS groups to work with Gia or= =20 John in developing value added documentation for this year's budget process= ? =20 Mike ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Houston Body:: I'm checking. Melissa loves talking about Houston real estate (one of the many quirks I love her for). I'll find out when she can do it. Ricardo Charvel 03/12/2001 01:00 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Houston Steve As you might have expected Elsa already had a to do list a budget information on schools etc. I really did not have to discuss about moving to Houston. The conversation was more around when and how. On Friday I have to be in Houston for an EBS meeting on Mexico. I am planning to arrive there on Thursday morning to talk to Rick to Dan Reck and to Shawn Cumberland. I also need to find out about relocation and visas etc. I am writing you to thank you for your generosity in your advice and for helping me and encouraging me in making this important decision. I am also wirting because I am taking your word on Melissa's knowledge of the real estate market inside the loop. Elsa is coming with me on Thursday morning and we would like to see if it is possible for us to meet with Melissa on Thursday Friday or Saturday for advice and orientation. (Of course you would be welcome to the real estate working session!!) Please let me know. Thanks again Ricardo What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Information and Securities Trading Body:: To:WILLIAMS WILLIAM Email:bwillia5@enron.com - 503-464-3730 Enron Wholesale Services - Office of the Chairman From: Mark Frevert Chairman & CEO Mark Haedicke Managing Director & General Counsel Subject: Confidential Information and Securities Trading To keep pace with the fluid and fast-changing demands of our equity trading activities Enron Wholesale Services (EWS) has recently revised its official Policies and Procedures Regarding Confidential Information and Securities Trading (Policies and Procedures). These revisions reflect two major developments: (1) our equity trading activities have been extended into the United Kingdom and (2) in an effort to streamline the information flow process the Review Team will play a more centralized role so that the role of the Resource Group is no longer necessary.You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: If you have already certified compliance with the Policies and Procedures during the 2001 calendar year you need not re-certify at this time although you are still required to to review and become familiar with the revised Policies and Procedures. If you have not certified compliance with the Policies and Procedures during the 2001 calendar year then you must do so within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Ed Segners Staff meeting, in 50M Dining Room Body:: John Stauffacher? What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Jeff wouldn't be able to leave until late the 23d or early on the 24th and would need to be back by late on the 27th What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Wed 6/20: Weather an early test for fee caps:=20 Any severe jump in prices will likely be curbed experts say Sac Bee Wed 6/20: State to borrow up to $5 billion to buy energy Sac Bee Wed 6/20: Dan Walters: Once burned lawmakers are very wary of Davis-Edison agreement SD Union Wed 6/20: Senate Democrats lay back to see if FERC action=20 provides rate relief=20 SD Union Wed 6/20: House panel erases Bush energy cuts LA Times Wed 6/20: Davis Regulators Face Off at Hearing LA Times Wed 6/20: Energy on Agenda but Issue Is Blame LA Times Wed 6/20: Blackout Forecasts' Dark Side LA Times Wed 6/20: FERC Move Short-Circuits for Hard Price Caps LA Times Wed 6/20: Plan Won't Raise Rates Davis Says LA Times Wed 6/20: State to Pay Electric Bill With Loan Not Taxes LA Times Wed 6/20: Edison Unveils Blackout Warning Plan LA Times Wed 6/20: State Joins Challenge to Bush on Air-Conditioner=20 Standards LA Times Wed 6/20: New Price Caps Not a Deterrent Power Firms Say LA Times Wed 6/20: The FERC's Action Is Good Bad Ugly (Commentary) SF Chron Wed 6/20: Davis OKs stopgap loan=20 CRISIS POWERS: Action sidesteps Legislature SF Chron Wed 6/20: Experts say state must seize the day=20 ANALYSIS: Price caps set stage for future SF Chron Wed 6/20: California's energy crisis hits Northwest like a tidal= =20 wave SF Chron Wed 6/20: Davis demands nearly $9 billion for electricity=20 overcharges SF Chron Wed 6/20: Fed price caps placate Demos=20 But Feinstein's bill to regulate energy producers was more strict SF Chron Wed 6/20: Potrero Hill power plant hit by 2 lawsuits=20 Neighbors city ask court to cut back hours of operation SF Chron Wed 6/20: Washington wakes up Mercury News Wed 6/20: Feinstein halts electricity price caps bill=20 Mercury News 6/20: FERC's fixes have fallen short (Commentary) OC Register Wed 6/20: Easing the crunch on costs of power (Commentary) Individual.com (Bridgenews) Wed 6/20: [B] POWER UPDATE/ US Senate panel to hold off vote on Calif. cap bill=20 Individual.com (Bridgenews) Wed 6/20: [B] FERC order seen having little= =20 effect on US generator profits Individual.com (PRnewswire) Wed 6/20: SCE Unveils Rotating Blackout Web S= ite and Public Notification Plan=20 Individual.com (AP) Wed 6/20: Edison CEO/ Ruling Hasn't Helped NY Times Wed 6/20: At Last Action on California (Editorial) NY Times Wed 6/20: Regulators' Order Could Bring Broad California Power= =20 Accord Wash. Post Wed 6/20: Davis Finds Hope in Calif. Power Crunch NY Times Wed 6/20: The Lesson of When to Give Aid to Free Markets --- Weather an early test for fee caps: Any severe jump in prices will likely b= e=20 curbed experts say. By Dale Kasler Bee Staff Writer (Published June 20 2001)=20 California electricity prices have shot back up recently potentially posin= g=20 an early test of a new federal price-control plan that takes effect today.= =20 Warm weather has sent wholesale prices doubling this week partially=20 reversing a dramatic slide that had some state officials believing they'd= =20 tamed the wildly unpredictable California electricity market.=20 The rebound in prices would be expected said Arthur O'Donnell editor of= =20 the California Energy Markets newsletter. It's 110 degrees in Phoenix and= =20 it's 100 degrees (in Sacramento) and points in between.=20 Prices this week moved back above $100 a megawatt hour about double what= =20 they were last week -- although well below the roughly $300 suppliers were= =20 charging California in mid-May. Prices showed signs of stabilizing Tuesday= =20 analysts said.=20 Experts said the Federal Energy Regulatory Commission's new price-mitigatio= n=20 plan is likely to curb the most severe price spikes. This will eliminate t= he=20 astronomical prices said Severin Borenstein director of the University o= f=20 California Energy Institute.=20 But the plan probably won't bring California a cascade of cheap power=20 either.=20 Prices likely will bump up constantly against FERC's new price caps which= =20 will fluctuate from time to time and they're not likely to go much below t= he=20 caps unless there's a significant glut of energy said Peter Stiffler of th= e=20 energy consulting firm Economic Insight Inc.=20 Traders will always trade in at the price ceiling Stiffler said. They'r= e=20 going to offer power at the highest price they can.=20 The fluctuating FERC caps are tied to the production costs of the=20 least-efficient most-expensive generating plant operating in California wh= en=20 supplies are tight and an official power alert is declared by the state's= =20 Independent System Operator which runs most of the power grid. When there= =20 isn't a power alert prices can't exceed 85 percent of the price establishe= d=20 during the most recent alert.=20 FERC said the system would begin today with a cap of $108.49 a megawatt hou= r=20 but would rise to $127.64 if a power alert is declared.=20 But the cap can fluctuate significantly. Under the old FERC plan the price= =20 cap in May was set at $267 a megawatt hour. The old plan was similar to the= =20 new system but applied only to California and only kicked in during power= =20 alerts.=20 With the caps flexible generators could have incentives to withhold power = at=20 some plants in order to raise the caps said Stanford University economist= =20 Frank Wolak.=20 The FERC plan still doesn't solve the problem of withholding said Wolak= =20 chairman of the ISO's market surveillance committee.=20 Wolak also said he's afraid FERC will let power generators exaggerate their= =20 costs in order to bump up the caps.=20 The good news is they seem to be more serious Wolak said of the=20 oft-criticized commissioners. But given how many times we've been taken in= =20 I'm wary.=20 In addition generators will be allowed to exceed the price caps if they ca= n=20 justify it to FERC officials. Borenstein said FERC in the past has allowed= =20 generators to justify just about every price level imaginable and he's=20 suspicious that the commission will let generators do the same in order to= =20 evade the new price controls.=20 State officials while cautiously optimistic about the plan were upset tha= t=20 FERC will allow a 10 percent price premium on electricity because of the ri= sk=20 of selling to the California market.=20 We recognize that the risk of nonpayment in California continues to be=20 greater than in other states the commission said in its written opinion= =20 released late Tuesday.=20 Gov. Gray Davis' spokesman Steve Maviglio called the premium ludicrous=20 because the state Department of Water Resources has been buying electricity= =20 ever since the state's troubled utilities exhausted their credit in=20 mid-January.=20 The state is as creditworthy a buyer as you can get Maviglio said.=20 Experts said the plan also won't correct the state's energy imbalance.=20 None of this is going to have much effect on blackouts Borenstein said.= =20 This is solving part of the problem I'm worried people will think=20 everything has been solved.=20 The emphasis now has to be on getting California to conserve he added.= =20 A spokesman for power generators Gary Ackerman said the price controls=20 could worsen shortages this summer and will discourage generating firms fro= m=20 investing in the new power plants the West desperately needs.=20 Builders are going to sit on the fence and think about this said Ackerma= n=20 head of the Western Power Trading Forum.=20 Acting in the face of mounting political pressure and unrelenting criticism= =20 from California FERC voted Monday to impose round-the-clock price controls= =20 throughout the 11-state Western region.=20 The FERC plan replaces a three-week-old plan that applied only to Californi= a=20 and took effect only when power reserves fell to below 7 percent of demand= =20 and an official power alert was declared.=20 By extending the plan to the entire West experts said the commission=20 probably put an end to the phenomenon known as megawatt laundering in=20 which power was shipped out of California and then re-imported. Imported=20 power wasn't subject to the old price controls.=20 The new controls said consultant Stiffler significantly narrow the abili= ty=20 of a trader to move power around and play the market.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m. State to borrow up to $5 billion to buy energy=20 By Emily Bazar Bee Capitol Bureau (Published June 20 2001)=20 State Treasurer Phil Angelides announced Tuesday that he will borrow up to = $5=20 billion to pay for future power purchases a move he said was necessary to= =20 avoid a continued drain on California's budget and cuts in other state=20 programs.=20 Since mid-January energy purchased by the state Department of Water=20 Resources on the spot market and under long-term contracts has come out of= =20 the state's general fund the source of most state spending.=20 Once the loan becomes final by the end of next week however energy will b= e=20 purchased with the proceeds.=20 Made possible by an emergency order from the governor the loan ultimately= =20 will be paid off by customers of the state's investor-owned utilities throu= gh=20 their electricity rates.=20 In essence it stops the general fund bleeding Angelides said.=20 The state has so far committed $8.2 billion from the general fund to=20 electricity purchases. Of that amount Angelides said the Department of Wat= er=20 Resources has actually spent about $6.1 billion through June 12 on power=20 purchases and has received about $900 million back from customers'=20 electricity rates.=20 Officials expect the loan to finance power purchases through September whe= n=20 they plan to issue up to $13.4 billion in revenue bonds.=20 The bonds will reimburse the general fund and and pay off the loan.=20 This gives the state some more running room some more cushion in case=20 anything goes awry with the bond sale to make sure ... the state does not r= un=20 out of general fund money jeopardizing education programs law enforcement= =20 programs children's and health services the Democratic treasurer said.= =20 Angelides said he has obtained firm commitments for $3.5 billion from JP=20 Morgan and Lehman Brothers at a blended interest rate of about 4.5 percent.= =20 If the long-term bonds are not issued by Oct. 31 the interest rate would= =20 climb to about 7 percent.=20 Lawmakers initially had hoped to close the short-term loan in May and float= =20 the long-term bonds shortly thereafter. However Republicans in the state= =20 Legislature balked at the plan forcing the delay of the bond sale until=20 mid-August.=20 Rather than wait Gov. Gray Davis invoked his emergency powers to allow for= =20 the loan and circumvent the delay.=20 Assembly Republicans don't mind that the governor used his emergency powers= =20 to expedite the loan said James Fisfis a spokesman for the caucus. Instea= d=20 he said they're concerned the loan could backfire and hurt Californians.= =20 If the larger bond offering falls through the penalties and added interes= t=20 could add up on ratepayers' bills he said.=20 But Angelides argued that the loan would benefit ratepayers on several=20 fronts: Power generators can no longer argue the state should pay a credit= =20 premium on electricity he said and for the most part will not be able to= =20 walk away from long-term energy contracts that have provisions requiring th= e=20 Department of Water Resources to obtain external financing by July 1.=20 Outside the Legislature the announcement drew praise from financial analys= ts=20 who had criticized the state for buying power with taxpayer money.=20 In late April for instance Standard & Poor cited fears over the state's= =20 mounting power costs when it downgraded California's credit rating on state= =20 bonds.=20 But S&P managing director Steven Zimmermann called the governor's executive= =20 order a step in the right direction.=20 We're very happy Zimmermann said. We were very anxious for the state to= =20 take the general fund out of the energy purchasing position it's been in.= =20 The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com= . Dan Walters: Once burned lawmakers are very wary of Davis-Edison agreement (Published June 20 2001)=20 The Capitol's politicians rarely attempt to resolve big complicated policy= =20 issues preferring to occupy their time with relatively trivial matters --= =20 which also tend to be the priorities of well-heeled and generous interest= =20 groups.=20 And when they even acknowledge a need to address something big they'll oft= en=20 just nibble at the edges rather than confront the underlying conflicts=20 squarely. That's been the pattern on water transportation population grow= th=20 and public education to name but a few of many examples.=20 The Capitol completed just one comprehensive or seemingly comprehensive b= it=20 of policymaking during the last quarter-century. But the issue on that=20 occasion was electric utility deregulation which has exploded into an ener= gy=20 crisis of monumental proportions. And that experience is having a paralyzin= g=20 effect on the Capitol's denizens.=20 Some Capitol old-timers call it 1890 disease named after the number of t= he=20 1996 bill that created California's fatally flawed system of pricing electr= ic=20 power. The legislation was written largely by lobbyists for affected intere= st=20 groups and then presented to the full Legislature for take-it-or-leave-it= =20 approval. The measure was passed without a single dissenting vote even=20 though only a few lawmakers even began to understand its ramifications.=20 It was a huge failure of the legislative process virtually a dereliction o= f=20 duty and those who participated have been doing some fancy explaining. But= =20 given the history both veteran legislators and those who came to the Capit= ol=20 after 1996 are very leery about putting their names on additional pieces of= =20 energy policy that could backfire if the real-world outcome is markedly=20 different from the purported effects.=20 One example is the $43 billion in long-term energy supply contracts=20 negotiated by Gov. Gray Davis' administration to end the state's dependence= =20 on volatile spot market prices. When the long-term contracting program was= =20 authorized by the Legislature early this year it was on the assurances of= =20 the administration that it could obtain large quantities of power at cheap= =20 prices. But by the time that the contracts were made final months later t= he=20 average price was 25 percent higher than what was stated earlier while the= =20 spot market had fallen dramatically. Now the long-term contracts that seeme= d=20 like such a good idea in January and February could become financial=20 albatrosses.=20 An even more telling example is the deal Davis made with Southern Californi= a=20 Edison to keep the utility from joining Pacific Gas and Electric in=20 bankruptcy. The utilities accumulated at least $13 billion in debts in six= =20 months buying power at prices much higher than they were allowed to=20 recapture from their customers. Consumer groups are denouncing the Edison= =20 deal as a corporate bailout that would impose multibillion-dollar burdens o= n=20 customers while imposing virtually no financial onus on Edison or its=20 creditors. And the deal's critics are pouncing on legislators' reluctance t= o=20 do something that might haunt them later -- especially in 2002 a critical= =20 election year.=20 Five years ago lawmakers and the utilities foolishly foisted this=20 deregulation scheme onto California consumers and now the governor and=20 Edison expect the ratepayers to pay billions more to save the utilities fro= m=20 their own mismanagement and bad policy decisions consumer gadfly Harvey= =20 Rosenfield said Tuesday as legislative hearings opened on the Edison deal.= =20 This time the whole world is watching the Legislature.=20 Harry Snyder of Consumers Union echoed Rosenfield's pledge to hold=20 legislators accountable. It looks a lot like 1890 Snyder said. It's too= =20 big (and) this is the same process all over again.=20 The sheer complexity and potential ramifications of the deal are weighing= =20 heavily on lawmakers. This is not a Mother's Day resolution Senate Energ= y=20 Committee Chairwoman Debra Bowen said wryly as the hearings began. Davis an= d=20 Edison lobbyists are pulling out all the stops but legislators are very= =20 very nervous about taking another big step that could generate public=20 backlash.=20 The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.c= om . Senate Democrats lay back to see if FERC action provides rate relief=20 By Finlay Lewis COPLEY NEWS SERVICE=20 June 19 2001=20 WASHINGTON =01) Key Senate Democrats called a truce Tuesday in the politica= l=20 wars raging over California's energy crisis as they adopted a wait-and-see= =20 posture over the Federal Energy Regulatory Commission's latest order=20 restricting electricity prices across much of the West.=20 Senators of both parties expressed relief over FERC's action on Monday. But= =20 Sen. Dianne Feinstein D-Calif. said she was skeptical that the order woul= d=20 end wholesale price manipulation by power providers or result in refunds to= =20 overcharged ratepayers.=20 Feinstein and Sen. Gordon Smith R-Ore. have prepared legislation seeking = a=20 much tighter pricing formula than the one FERC used. But she asked that the= ir=20 bill be set aside temporarily in deference to the agency's action.=20 I think we should wait and see what happens Feinstein said during a Sena= te=20 Energy and Natural Resources Committee hearing on the FERC order.=20 Democrats on the committee pressed FERC Chairman Curtis L. Hebert and the= =20 four other commissioners on why they had not acted sooner to control the=20 daily price turbulence in the California energy market. A market-interventi= on=20 order issued by FERC in April was designed to cope only with energy-supply= =20 emergencies despite pleas by California Gov. Gray Davis and other Californ= ia=20 Democrats for more drastic measures.=20 It's time to stop blaming and start problem-solving said Hebert a=20 Republican appointed chairman by President Bush.=20 Hebert noted that electricity prices on the volatile spot market have dropp= ed=20 considerably since the April order. Prices on the energy futures market hav= e=20 also tumbled as have natural gas prices =01) a key component in the cost o= f=20 electricity.=20 On Monday FERC unanimously ordered around-the-clock restraints on wholesal= e=20 electricity prices in California and 10 neighboring states over the next 15= =20 months.=20 As was the case with the April measure prices will be pegged to the costs = of=20 the least efficient power provider when reserves in California fall below 7= =20 percent. But when reserves are more plentiful the prices will drop to 85= =20 percent of the level established during supply shortages.=20 The order also provides for a 22-day period involving arbitration and revi= ew=20 by an administrative law judge for resolving price-gouging allegations and= =20 providing refunds in cases of improper pricing.=20 Adamantly opposing price controls earlier FERC acted after coming under=20 intense pressure from lawmakers of both parties. Republicans said they were= =20 worried that their GOP colleagues in California would have been blamed and= =20 possibly imperiled at the polls if FERC had failed to act.=20 Bush who also took a hard line against price caps blessed FERC's action= =20 after it was taken.=20 Hebert criticized the bill advanced by Feinstein and Smith as an attempt to= =20 solve California's problem by bureaucratic fiat.=20 Their measure would calculate wholesale electricity prices based on the=20 reported production costs of the individual generators with an added=20 allowance for a profit margin.=20 Hebert argued that the mitigation price that FERC will establish is not = a=20 blunt arbitrary figure that bears no resemblance to market conditions and = is=20 subject to political pressures and whims.=20 Meanwhile Commissioner William Massey made it clear that he harbors=20 misgivings about the FERC measure although he supported it.=20 He said the agency should have acted earlier to avoid the subsequent=20 carnage in California has failed to provide guidelines that would assure= =20 refunds to overcharged consumers and has acted questionably in allowing pow= er=20 providers to impose a 10-percent surcharge to cover credit-worthiness risks= .=20 Massey a Democrat who has consistently criticized his colleagues for movin= g=20 too slowing in the California crisis also said he wondered whether the ord= er=20 would provide an unintended incentive for generators to continue using=20 inefficient units in order to assure higher profit margins for their more= =20 modern facilities.=20 Sen. Barbara Boxer D-Calif. said she would propose legislation later this= =20 week designed to assure refunds to customers who have had to pay unfair=20 prices for their electricity.=20 If FERC won't do it ... Congress should Boxer said.=20 A spokesman for Sen. Jeff Bingaman D-N.M. chairman of the committee said= =20 Bingaman agreed with Feinstein on the need for a time-out while the FERC=20 order is being implemented.=20 Gov. Davis will testify today (6/20) before the Senate Government Affairs= =20 Committee which is investigating FERC's role in the crisis. Hebert and the= =20 other commissioners will also appear.=20 House panel erases Bush energy cuts=20 By Alan Fram ASSOCIATED PRESS=20 June 19 2001=20 WASHINGTON =01) A House subcommittee voted Tuesday to spend $1.2 billion mo= re=20 next year than President Bush proposed for energy and water programs=20 underlining lawmakers' sensitivity to the West's power problems and their= =20 desire for home-district projects.=20 The $23.7 billion measure approved by voice vote by a panel of the House= =20 Appropriations Committee is normally one of the more routine of the 13=20 annual spending measures Congress must approve. But with this year's=20 escalating battle between Bush and Democrats over energy policy the=20 measure's profile has been raised.=20 The bill would provide $18.7 billion for the Energy Department $641 millio= n=20 more than Bush requested and $444 million more than this year. Fiscal 2002= =20 which the bill covers begins Oct. 1.=20 It also includes nearly $4.5 billion for the Army Corps of Engineers and th= e=20 hundreds of water projects it has under way across the country $568 millio= n=20 more than Bush proposed but $73 million less than this year.=20 The measure was approved shortly after top members of the committee met wit= h=20 Bush at the White House.=20 Participants said Bush and the lawmakers reaffirmed their goal of keeping t= he=20 price tag of the 13 bills to $661 billion which is one-third of the overal= l=20 federal budget. That would be a 4 percent boost over 2001 which many=20 Democrats =01) and some Republicans in private =01) say is too low.=20 He said there would be attempts to raise this as we go through the process= =20 and let's stick with him said Rep. Sonny Callahan R-Ala. chairman of th= e=20 energy and water subcommittee.=20 Illustrating the pressures Republicans face David Sirota spokesman for th= e=20 Democrats on the committee said the bill lacked the new spending needed fo= r=20 renewable energy and other programs that could help alleviate power=20 shortages.=20 Under the bill approved Tuesday renewable energy programs would get $377= =20 million $100 million more than Bush wanted and $1 million more than this= =20 year. Nuclear energy basic energy sciences biological and environmental= =20 research and a study of whether spent nuclear fuel should be stored at a=20 Nevada site would all get about what Bush proposed.=20 The bill's $7.03 billion for environmental cleanups is $699 million more th= an=20 Bush proposed. Programs aimed at containing the nuclear arsenals of former= =20 Soviet states would get $845 million $71 million more than Bush's plan.=20 Members voted to hold the brief meeting behind closed doors after citing th= e=20 national security sensitivity of publicly discussing some of the nuclear=20 weapons programs covered by the bill.=20 Davis Regulators Face Off at Hearing From Reuters=20 ?????WASHINGTON -- California Governor Gray Davis a Democrat today blamed= a=20 Republican-led energy regulatory agency for not doing enough to help his=20 energy-starved state and demanded refunds of $6.7 billion for alleged=20 price-gouging by power generators. ?????Davis whose political future has been linked to his state's electrici= ty=20 woes was testifying at a Senate hearing with members of the Federal Energy= =20 Regulatory Commission. ?????The hearing marked the first time that Davis met face to face with all= =20 five FERC commissioners. ?????FERC regulates interstate electricity markets and has jurisdiction to= =20 order refunds by power generators found to have overcharged utilities. ?????Earlier this week the agency led by a Republican majority rejected= =20 Davis' pleas for strict caps on prices that soared above $400 per megawatt= =20 hour last month. ?????Sen. Joseph Lieberman the former Democratic vice presidential nominee= =20 heads the Senate Governmental Affairs Committee that quizzed the FERC=20 commissioners and Davis on efforts to stabilize the chaotic Western=20 electricity market. ?????Davis accused FERC of failing to act aggressively against alleged=20 price-gouging by out-of-state generators. ?????To date not a single penny in refunds has been returned to=20 Californians Davis said. It is unconscionable for the generators to prof= it=20 from their egregious overcharges. FERC must move quickly to enforce the law= =20 and order the energy companies to give back the money. ?????Davis said the state is owed refunds of at least $6.7 billion.=20 California's grid operator has estimated that from May 2000 to May 2001=20 power generators charged the state nearly $9 billion more than a competitiv= e=20 market would warrant he said. ?????California the nation's most populous state has been hit with a seri= es=20 of rolling blackouts the bankruptcy of its largest utility and an economi= c=20 slowdown since the power crisis began last year. ?????The state is expected to convene a criminal grand jury to investigate= =20 whether some power generators withheld supplies shut down plants or=20 exploited the bidding process to drive up prices. Out-of-state generators= =20 deny any illegal activity saying the high prices simply reflect supply=20 shortages. ?????Today also marks the day that FERC's newly expanded price mitigation= =20 program goes into effect in all 11 Western states with a wholesale price=20 limit of $107.9 per megawatt hour linked to a market formula. The plan had= =20 previously applied only to California during emergency power outages. ?????Since FERC's action earlier this week Senate Democrats dropped a=20 legislative effort to strictly cap electricity prices in the West. However= =20 California Democrats in the House were still trying to force a full vote on= a=20 package of energy amendments including a price cap. ?????The Bush administration and many Republicans oppose price caps=20 contending they would discourage more power production. ?????Separately today the U.S. Energy Department issued a study that=20 supported the White House's view that strict price caps would hurt not hel= p=20 California. ?????The study found California faces about 113 hours of rolling blackouts= =20 this summer a level that would double if wholesale prices were capped at= =20 $150 per megawatt because some 3600 megawatts of generating capacity would= =20 shut down. An alternative approach of setting a price cap based on producti= on=20 costs plus $25 per megawatt would delay or close about 1300 megawatts of= =20 capacity scheduled to be built in the state according to the study. ?????However lawmakers from both political parties have scrambled for some= =20 kind of solution to address the shortages in California well before the=20 congressional elections next year. ?????The FERC plan expands an existing price mitigation program in=20 California to 10 other Western states. The plan which runs through Septemb= er=20 2002 means that during nonemergency periods the price for wholesale power= =20 cannot exceed 85 percent of the cost of electricity sold during a Stage 1= =20 power shortage emergency in California. ?????A Stage 1 emergency is declared when electricity supplies fall below 7= =20 percent of demand on the Western power grid. ?????The plan also imposes a 10 percent surcharge on all power sales into= =20 California as financial protection for generators reluctant to sell to the= =20 state's financially weak utilities. ?????Davis was due to meet the two newest FERC commissioners Patrick Wood = of=20 Texas and Nora Brownell of Pennsylvania today. Both are former utilities= =20 regulators in states that successfully deregulated their power industry and= =20 nominated to the agency by President Bush. Copyright 2001 Los Angeles Times=20 NEWS ANALYSIS Energy on Agenda but Issue Is Blame=20 Politics: Gov. Davis will try to sway voter anger toward the GOP as he face= s=20 a Senate panel.=20 By RONALD BROWNSTEIN Times Political Writer=20 ?????WASHINGTON--When California Gov. Gray Davis testifies at a high-profil= e=20 Senate hearing today the issue formally on the table will be the expanded= =20 electricity price controls that federal regulators approved this week. But= =20 the session's political subtext will be the escalating struggle between Dav= is=20 and national Republicans to determine where California voters look for=20 solutions--and blame--for the state's power woes. ?????In both California and Washington Republican strategists believe Davi= s=20 is trying to manufacture a succession of conflicts with the White House tha= t=20 will allow him to run in 2002 as much against President Bush as against=20 whomever the state GOP nominates in the gubernatorial race. In return=20 Republicans are trying to shift the focus back toward Davis--most=20 aggressively through a California-wide television advertising campaign=20 organized by Scott Reed a former executive director of the Republican=20 National Committee. ?????Our goal is to get the focus back to Sacramento where it belongs= =20 Reed said. ?????Both sides see the same prize in this tug of war: the opportunity to= =20 determine where most Californians direct their anger during what could be a= =20 long hot summer of power shortages. ?????The situation is that the public's minds are not made up on this=20 issue--whether it is Sacramento or Washington who has acted too little too= =20 late said Mark Baldassare a pollster at the independent Public Policy=20 Institute of California. That gives both sides an opportunity to get their= =20 messages out. The stakes are fairly high in terms of how the public in=20 California ends up assessing blame over the next few months. ?????A Slight Uptick in Davis' Popularity ?????Overall Davis' political situation appears to be stabilizing. After= =20 months of runaway power costs the prices the state pays for wholesale=20 electricity are falling and new plants will come online next month. And=20 following a free fall in private polls Davis has seen his numbers tick bac= k=20 up slightly. Similarly a poll financed by independent power generators=20 showed that in mid-June for the first time in months Californians were=20 becoming slightly more confident that the crisis is easing. ?????Within the state Capitol Davis is asserting himself demanding that= =20 lawmakers hold hearings on his rescue plan for Southern California Edison. = On=20 Monday he released details of a similar plan for San Diego Gas & Electric.= =20 Last week he announced an agreement that is likely to increase generation = by=20 alternative energy producers who account for about a fourth of the state's= =20 supply. ?????This guy is changing said state Sen. Steve Peace (D-El Cajon) who = a=20 few months back had been urging that Davis take a more aggressive stance on= =20 the crisis. There is a difference in his demeanor and focus. ?????Yet the energy crisis still looms as a vast cloud over a reelection=20 campaign that once looked like a stroll on the beach. ?????The paradox for Davis is that the substantive victory for pricecontrol= =20 advocates at the Federal Energy Regulatory Commission meeting this week may= =20 complicate his political goal of maintaining a heavy focus on Washington.= =20 Though Davis and some congressional Democrats portrayed FERC's decision as= =20 insufficient it appears to have lanced the pressure for federal legislatio= n=20 to impose the tighter price controls that Davis supports.=20 ?????Sen. Dianne Feinstein (D-Calif.) a principal sponsor of that bill on= =20 Tuesday announced she would shelve the measure for six months to give the n= ew=20 FERC plan time to work. ?????As a result the political effect of the FERC ruling could be to shift= =20 the focus away from Washington back toward decisions in Sacramento which i= s=20 exactly what Republicans prefer. Gray Davis is the dog that finally caught= =20 the car said Dan Schnur a San Francisco-based GOP consultant. Davis is= =20 going to keep screaming about price caps and refunds but now Republicans c= an=20 point to substantive action. ?????Davis: 'Much More They Should Do' ?????For months Davis has criticized Bush for refusing to support=20 electricity price controls and other measures that the governor says could= =20 ease California's energy crunch. At almost every opportunity Davis offers= =20 the same message: California is taking the steps it needs to but Washingto= n=20 has failed to help enough. That was precisely Davis' message Monday when FE= RC=20 significantly expanded the limited price caps it had imposed previously. ?????While saying that FERC had finally taken a step in the right=20 direction Davis added: There is much more they should do--including=20 providing refunds to California for alleged overcharges. The overall tone o= f=20 Davis' statement was much more skeptical about FERC's action than the remar= ks=20 from Feinstein who described the decision as a giant step forward. ?????Aides say Davis plans to repeat that two-part message in his appearanc= e=20 today before the Senate Governmental Affairs Committee chaired by Sen.=20 Joseph I. Lieberman (D-Conn.). In his testimony and in a round of schedule= d=20 television appearances Davis will demand that FERC order refunds in the=20 range of $5 billion to $6 billion to the state aides said. Davis also will= =20 distribute to every member of Congress a 177-page book chronicling the=20 state's response to the crisis. ?????Inside the Bush White House some officials see in Davis' cool respons= e=20 to FERC's decision more evidence that the governor is determined to use the= =20 White House as a foil in his reelection campaign. The prevailing view one= =20 official said is that no matter what concessions the administration offer= s=20 Davis will immediately raise the bar and demand something else--the way he= =20 did by talking about rebates as soon as FERC offered tougher price controls= . ?????That is Davis' M.O. said one official involved in the White House's= =20 energy strategy. He asks the administration to do something the=20 administration does it and then he attacks the administration for not doin= g=20 enough. . . . He needs someone to blame. ?????Davis aides reject that characterization arguing that the governor is= =20 merely representing the state's interests against an administration that th= ey=20 maintain is favoring energy producers over consumers. But Davis advisors=20 acknowledge that they have used focus groups to test campaign messages that= =20 pin the blame for the energy crunch primarily on Davis' Republican=20 predecessor Pete Wilson and a Republican president who has failed to sto= p=20 his rich friends in the energy industry from gouging consumers one aide= =20 said. ?????You don't have to tell people in focus groups more than once how this= =20 is connected the Davis aide said. ?????Gubernatorial Rivals Are Free of Blame ?????Baldassare the independent pollster notes it may be especially=20 imperative for Davis to keep Bush's energy decisions in the spotlight becau= se=20 none of his potential Republican opponents in 2002--California Secretary of= =20 State Bill Jones former Los Angeles Mayor Richard Riordan or businessman= =20 William E. Simon Jr.--is easily tagged with complicity in the problem. Non= e=20 of them were really involved in the decision-making over deregulation=20 Baldassare said. The only one else to blame in a political sense is=20 Washington and the Bush administration. ?????The new independent advertising campaign against Davis was inspired=20 largely by the fear of that strategy succeeding--damaging the standing in= =20 California not only of Bush but also of other Republicans particularly tho= se=20 in Congress. Reed whose American Taxpayers Alliance is funding the ads sa= id=20 he decided to launch the campaign after Davis appeared to gain the upper ha= nd=20 in the media debate following Bush's visit to California late last month. ?????The Bush trip really changed the terms of debate about Davis' problem= =20 and made it more of a possible national Republican problem Reed said. Th= e=20 entire terms of debate turned around and was focused on the issue of price= =20 caps as opposed to negligence on Davis' behalf. Our group is attempting to = go=20 out and engage Davis. ?????To engage Davis Reed's group which has not revealed its donors is= =20 spending what he said would be $1.5 million on an initial ad criticizing=20 Davis this week though a spot check of TV stations around the state=20 indicated a far more modest buy. Reed said the group is planning to air a n= ew=20 ad as soon as this week. ?????Democrats plan to answer the ads with attacks of their own and will be= =20 filing complaints with the IRS and other federal agencies about the anonymo= us=20 funding of the Reed ad. ?????Today's Senate hearing will give Davis another chance to respond to th= e=20 GOP and make his case for greater help from Washington. But Lieberman aides= =20 acknowledge the hearing is likely to be much less confrontational than it= =20 would have been if FERC had not acted Monday. The agency's decision change= d=20 the dynamic the aide said. ?????That assessment may apply not only to the conflict between FERC and it= s=20 critics but also equally to the hostilities between Davis and the White Hou= se. ---=20 ?????Times staff writers Dan Morain in Sacramento and Mark Z. Barabak in Lo= s=20 Angeles contributed to this story. Copyright 2001 Los Angeles Times=20 Blackout Forecasts' Dark Side=20 If optimists are wrong and the power runs out California's energy crisis= =20 could quickly cost lives and cripple the economy.=20 By JENIFER WARREN Times Staff Writer=20 ?????It's here. Summer 2001 the blackout season is only a day away. ?????Already Californians anticipate power outages when temperatures rise. = By=20 August the occasional annoyances endured so far--stoplights gone dark=20 computers air conditioners and elevators idled--could seem almost quaint. ?????Gov. Gray Davis insists we needn't worry. Four large new power plants= =20 are firing up soon he said and government's best and brightest are lockin= g=20 up still more megawatts to help meet our peak summer need. Californians=20 Davis predicts will valiantly heed his call to conserve helping the state= =20 survive the hot months no sweat. ?????With luck he'll be right. Power prices have stabilized and some ener= gy=20 analysts are wondering whether California may have tamed the blackout beast= . ?????But what if those plants don't get built in time people don't trim=20 their electricity use 7% and energy imports are more meager than expected? ?????And what if the state gets hit by a summer that is not moderately hot= =20 as Davis bets but blistering record-setting hot? ?????Government experts who ponder such questions don't expect disaster in= =20 the coming months. But they are planning for it nonetheless. ?????At best they say Californians can expect some gridlocked=20 intersections an occasionally overloaded 911 system perhaps some business= =20 bankruptcies certainly inconvenience. At worst the Western power grid cou= ld=20 crash causing uncontrolled blackouts that might lead to looting=20 contaminated water supplies even civil unrest. ?????How bad could this summer get? said state Sen. Joe Dunn (D-Santa Ana= ).=20 This summer could be the worst disaster to ever hit the state of Californi= a. ?????Imagine it's a Thursday morning in the third week of July. Relentless= =20 heat grips California the curse of a stubborn high-pressure ridge that jus= t=20 won't budge. ?????As air conditioners from Redding to Chula Vista lumber to life manage= rs=20 of the state's power grid in Folsom gulp their third and fourth cups of=20 coffee stare at a bank of computers and begin to fret. ?????Demand is jumping. Supply is static Canada and Arizona have nothing t= o=20 sell. It's looking tight. ?????Thirty minutes later the picture is gloomier. A brush fire shuts down= =20 transmission lines near Fresno squeezing supply in the Central Valley. In= =20 the Bay Area the unusual heat drives demand well past projections. ?????By noon things look bleak. Operators of the Diablo Canyon nuclear powe= r=20 plant near San Luis Obispo have cut output by 80%. The trouble? Chunks of= =20 kelp have lodged in one of the plant's seawater intake valves creating a= =20 clog like one that plagued the facility in January. ?????With a chorus of groans the grid's keepers scour the market for power= =20 to offset the Diablo loss. No luck. As the mercury climbs and the Golden=20 State economy roars into full swing electricity consumption ticks upward= =20 minute by minute. And when managers of a power plant near Long Beach cut=20 output because of a cracked turbine everyone knows what it means. ?????Alert the utilities. It's lights out California for the fourth day i= n=20 a row. ?????Dr. J. Michael Leary dreads blackouts--not personally but=20 professionally. Leary is an emergency room physician in the desert city of= =20 Rancho Mirage. When air conditioners go on the blink there the=20 victims--scores of them mostly old folks--wind up in his ER. ?????In a normal year 75% of his emergency patients are geriatrics. Like= =20 infants the elderly are unusually vulnerable to the heat. When blackouts= =20 hit they are most at risk. ?????It's as if you lived in Maine and they turned the heat off in January= =20 Leary said. This is an extreme environment we live in. The effects can be= =20 devastating. ?????Many desert seniors are on fixed incomes and live in mobile homes som= e=20 of them poorly insulated boxes that turn into ovens under the brutal summer= =20 sun. Take away the air conditioning and the humans inside start baking qui= ck. ?????For Leary the specter of continual back-to-back blackouts in=20 July--and some predict in June and August too--conjures images of an=20 82-year-old man living alone in one of those mobile homes taking medicati= on=20 for heart disease. The cardiovascular drugs plague the man with numerous si= de=20 effects one inhibits his body's ability to cool itself. ?????When a person gets overheated body temperature eventually rises=20 uncontrollably. Then comes a nasty spiral of effects and pretty soon you = go=20 into shock Leary said. Everything just shuts down. ?????On average each year 371 Americans die from heat-related causes more= =20 than the number killed by earthquakes tornadoes hurricanes lightning and= =20 floods combined. In 1995 a record hot spell in Chicago killed 465 people.= =20 Eleven Californians died from the heat in 1998. ?????A new report by the United Seniors Assn. predicts that more than half = a=20 million elderly Californians could need hospitalization for heat-related=20 ailments this summer.=20 ?????Some communities have laid plans for cooling shelters wading pools an= d=20 other measures to provide relief. But will all who need help get it? Or get= =20 it in time? ?????Out in the desert paramedics expect a crush of 911 calls when the pow= er=20 goes out and the ill frail and frightened seek help. Leary and others at= =20 Eisenhower Medical Center will be waiting armed with ice packs cooled IVs= =20 and ventilators. ?????I am very very worried the doctor said. I think we'll see a great= =20 toll in human suffering even mortality. ?????California's tomato processors are no less anxious. They wash cook= =20 peel chop mash and can about 1 million tons of tomatoes a week from July = to=20 October--enough to account for half the world's supply. For them a string = of=20 unexpected power losses could mean economic ruin in a matter of days. ?????The reason lies in the peculiar nature of food processing--a sterile= =20 system instantly contaminated if the power fails and the plant's precise=20 temperature is disturbed. ?????Once a batch of tomatoes is tainted it must be thrown out--all 50000= =20 pounds. The plant must then be sanitized a painstaking process that takes= =20 about 36 hours. ?????If you get hit by blackouts every third day for say two weeks you'= re=20 starting stopping cleaning restarting--it's a nightmare said Jeff Boes= e=20 president of the California League of Food Processors. You could lose thre= e=20 batches and be out $40 million before you knew what hit you. ?????Meanwhile farmers with still more truckloads of tomatoes line up=20 outside the plant waiting to be paid for their crop: If we can't process= =20 them the farmers have spent an entire season growing them for nothing=20 Boese said. ?????In Sonoma County the object in peril is the chicken. Egg producers=20 equip their laying houses with fans and swamp coolers to keep the hens=20 comfortable. Power is also needed to run giant refrigerators filled with eg= gs. ?????In a blackout those hens can overheat in no time said Rich Matteis= =20 of the Pacific Egg and Poultry Assn. In 20 or 30 minutes you could have= =20 100000 birds die. ?????Many large producers have backup generators but they are not designed= =20 for ongoing intensive use. Will they hold up? Small-scale egg producers=20 often have no backup power at all. ?????Hundreds of other California businesses could suffer if summer shapes = up=20 as bad as some predict. ?????The Valero Refining Co. of California northeast of San Francisco=20 produces 115000 barrels of gasoline a day. Because restarting a refinery i= s=20 a complicated task two or three blackouts close together could prompt=20 officials to shutter it until electricity supplies stabilize--costing=20 California about 10% of its gasoline supply. ?????At a Berkeley medical laboratory doctors say power losses to their=20 freezers could destroy bone marrow needed to give young leukemia patients= =20 lifesaving transplants. The state's 400 dialysis centers where patients=20 without kidney function go to have their blood cleansed every other day ar= e=20 in the same fix. Few have backup generators so when an outage hits=20 technicians must crank the machines by hand. ?????Most Californians of course face far more ordinary consequences. The= =20 scoreboards will fizzle at summer softball games joggers on treadmills wil= l=20 be stopped in their tracks electric organs will go silent leaving choirs = to=20 sing without accompaniment. ?????Parents will be asked to retrieve children from day-care centers when= =20 the lights and cooling systems conk out. Anniversary lunches may be ruined= =20 when restaurants cannot grill salmon or blend margaritas. ?????Most people will tolerate occasional disturbances psychologists say= =20 doing their part in a time of crisis. But what if such irritations become a= n=20 everyday fact of life? ?????Hundreds of essential energy users--including prisons fire=20 departments and airports--are protected from blackouts and hundreds more= =20 have applied for exemptions. That means the pool of people bearing the=20 blackout burden is shrinking so more frequent outages are likely. ?????Blackout predictions vary widely but at least one forecaster a=20 consultant for California water districts anticipates an outage almost eve= ry=20 afternoon of every workday this summer if temperatures are unusually warm. ?????Californians are accustomed to trash compactors giant-screen TVs and= =20 having the Internet at their fingertips. How much deprivation will they=20 tolerate? ?????So far the version of blackouts we've experienced hasn't looked too= =20 scary to people--it happens on a workday in the afternoon and you basical= ly=20 have to come home and reset your VCR said Dan Kammen a professor of ener= gy=20 and society at UC Berkeley. ?????But if outages become daily events and start to invade the evening=20 hours the public mood could change abruptly. ?????When there's a disaster or crisis or trauma people tend to act=20 heroically and work together said Robert Butterworth a Los Angeles=20 psychologist and trauma specialist. But the civilized behavior only lasts = a=20 short period. Then people start acting in unpredictable ways. ?????That tendency may be exacerbated Butterworth said by the nature of t= he=20 energy crisis--not a natural disaster but a man-made one. ?????People start to look for a scapegoat he said. People will look for= a=20 target and there's a tendency to strike out at whoever is closest to you. ?????One place that tendency may surface Butterworth said is on=20 traffic-clogged roads. Blackouts already have led to scores of accidents. A= dd=20 summer heat to the mix and repeat the pattern day after day at rush hour= =20 and motorists' patience could wear thin law enforcement officials say. ?????We're bracing for . . . possible acts of violence and road rage sai= d=20 Sacramento County Sheriff's Lt. Larry Saunders. ?????Lon House is the water consultant who predicts California could see=20 blackouts almost every summer weekday. Among the worries for the 440 water= =20 agencies he represents: losing the ability to pump water during wildfire=20 season. ?????I'm telling them to be ready for a major earthquake every day this=20 summer--meaning all your power is out throughout your district for multiple= =20 hours House said. ?????House insists he isn't an alarmist. But on top of the fire fears he= =20 warns that blackouts of more than a few hours would allow air into water=20 pipes contaminating supplies. If that happens Californians would be urged= =20 to boil their water until the system can be disinfected from one end of the= =20 pipe to the other. ?????Though rolling blackouts are risky they remain essentially a controll= ed=20 phenomenon occurring when and where the grid managers and utilities decide= .=20 Far more frightening--and devastating--are unexpected cascading outages th= at=20 could shut down the entire Western power grid. It happened in August 1996= =20 leaving 4 million people without power during a triple-digit heat wave. ?????The problem began when power lines in Oregon sagged into trees and shu= t=20 themselves off. That triggered a chain reaction of automatic switch-offs an= d=20 oscillating surges of energy that ultimately shut down all four of the main= =20 power arteries between California and the Pacific Northwest. ?????That robbed the system of thousands of megawatts--enough to power the= =20 city of Seattle four times over--and scattered outages across California an= d=20 six other Western states. Thousands of customers were without power for mor= e=20 than a day. ?????Though such an episode is rare California grid managers say it is mor= e=20 likely today because the system is taxed by the ever-increasing load of=20 electricity it bears. ?????The system is very dynamic and when it's heavily loaded and highly= =20 stressed like it is now the smallest little thing could cause big trouble= =20 said Kevin Bakker who oversees California's connection to the greater=20 Western power grid.=20 ?????If a massive uncontrolled outage should hit the ramifications could = be=20 dizzying said Mike Guerin chief of law enforcement for the state Office o= f=20 Emergency Services. Police departments would probably go to tactical alert= =20 guarding against looting by criminals who might take advantage of disabled= =20 alarm systems and darkened street lights. ?????In hot areas cities might convert municipal buses--parked with air=20 conditioners running--into cooling shelters Guerin said. The state would= =20 provide emergency generators to nursing homes and others in need while the= =20 California National Guard might be called into action. ?????With this kind of blackout scenario you're not worried about the=20 bologna going bad in the refrigerator Guerin said. We're talking about= =20 doctors doing surgeries on backup generators for three days. We're talking= =20 about a lot of things we don't like to think about. ---=20 ?????Times staff writers Nancy Vogel and Alexander Gronke and researcher=20 Patti Williams contributed to this story. Copyright 2001 Los Angeles Times=20 FERC Move Short-Circuits Push for Hard Price Caps=20 By RICHARD T. COOPER and JANET HOOK Times Staff Writers=20 ?????WASHINGTON--The Federal Energy Regulatory Commission's decision to=20 impose full-time price ceilings on wholesale electricity in California and= =20 the West appears to have deflated the congressional drive for a return to= =20 traditional utility regulation. ?????Sen. Dianne Feinstein (D-Calif.) calling the price mitigation syste= m=20 FERC unveiled Monday a giant step forward announced Tuesday that she is= =20 pulling back her bill to force a return to the cost of service pricing=20 system that prevailed before deregulation. Republican Sen. Gordon Smith of= =20 Oregon a co-sponsor agreed as did Sen. Jeff Bingaman (D-N.M.) chairman = of=20 the Senate Energy Committee. ?????House Democrats vowed to fight on for tougher controls but they were= =20 given little chance to succeed. ?????As a result although the political blame game will rage on the reali= ty=20 of a long ugly summer for California appears to have arrived: at least=20 several months of tears toil sweat--and fast-rising electric bills. ?????California consumers are likely to face an unpleasant paradox energy= =20 analysts said: Given present power shortages blackouts are virtually=20 inevitable this summer. And since state authorities are beginning to let= =20 high wholesale prices flow through into retail bills after months of=20 subsidies many consumers could face higher charges at the same time their= =20 lights begin to flicker. ?????Even if FERC's order succeeds and wholesale prices fall as they have= =20 begun to do in recent weeks consumers' bills are likely to rise. Since=20 retail charges lag well behind wholesale prices closing the gap will=20 probably mean a period of higher costs for consumers regardless of what=20 happens in wholesale markets. ?????There is light at the end of the tunnel energy analysts said but it = is=20 probably a year away. And reaching it they said depends in part on=20 government officials taking no action that might spook investors and disrup= t=20 present plans for expanding the region's capacity to generate and deliver= =20 more power. ?????The new FERC system which its designers said would provide temporary= =20 price relief while preserving incentives for energy investment imposes=20 cost-based curbs on wholesale prices throughout the West and covers all suc= h=20 sales not just those during periods of extreme shortages as did the order= =20 issued in April. ?????FERC Chairman Curtis L. Hebert Jr. told the committee the new system= =20 will prevent megawatt laundering and other potential abuses. He said his= =20 agency is committed to ferreting out any forms of market misbehavior 24=20 hours a day seven days a week. ?????With the apparent collapse of demands for more intervention Congress= =20 now seems ready to give FERC a year or more of leeway to see whether its pl= an=20 will curb wholesale prices and create what FERC member Linda Breathitt a= =20 Democrat called a breathing spell in which California and the West can= =20 repair their dysfunctional markets. ?????It still remains to be seen whether there can be manipulation but I= =20 think we should wait and see Feinstein said Tuesday at a Senate Energy=20 Committee meeting attended by all five FERC members. The commissioners call= =20 their new system price mitigation not price caps but Feinstein said it= =20 amounts to the same thing. ?????Whether you call it price mitigation or something else a rose is a= =20 rose is a rose said Feinstein a member of the energy committee. ?????And Sen. Barbara Boxer (D-Calif.) appearing before the committee as a= =20 witness said: I was very pleased with [Monday's] about-face by FERC. I=20 believe they have a new tone. ?????Democrats on the other side of the Capitol pledged to keep fighting fo= r=20 traditional regulation but with Republicans in control of the House the= =20 struggle appears to be largely symbolic. ?????House Democrats wanted to introduce amendments on price controls and= =20 other energy policy to a mid-year supplemental appropriation bill due to co= me=20 before the House today. However GOP leaders expected to block Democrats fr= om=20 even offering the amendments on procedural grounds. ?????The most sweeping of the amendments would set cost-based limits on=20 wholesale energy prices in the West. Rep. Henry A. Waxman (D-Los Angeles) a= nd=20 other sponsors insisted that the measure is still needed in spite of the FE= RC=20 action which he said would continue to provide windfall profits to=20 generators encourage suppliers to withhold power and do too little to=20 restrain the price of natural gas. ?????He called the FERC policy an experiment that is using California and= =20 other Western states as subjects. ?????Similarly Rep. Nancy Pelosi (D-San Francisco) said: Although the FER= C=20 decision [Monday] is a step in the right direction I am concerned it does= =20 not remove incentives for energy suppliers to withhold power drive up pric= es=20 and gouge consumers. ?????The commission went as far as it did in part because of the specter of= =20 broader price control legislation Pelosi said. They felt the heat they s= aw=20 the amendments coming and decided to act. ?????And Rep. Bob Filner (D-San Diego) in an interview Tuesday said he wi= ll=20 press ahead with legislation to impose hard price caps. I would advise the= =20 senators that after a year of dealing with these price gougers that they wi= ll=20 easily manipulate this latest order he said calling it a Swiss cheese= =20 order--full of holes.=20 ?????Feinstein's shift put House Democrats in an awkward political position= =20 because it came just as they prepared to make their big push for tougher=20 controls. But the Democrats tried to minimize the differences in legislativ= e=20 strategy. ?????She too is waiting to see if the FERC experiment works Waxman said.= =20 I'm a little more skeptical but we're both watching carefully. ?????As a political matter a Democratic leadership aide acknowledged the= =20 FERC order muddies the debate at a time when Democrats have been working ha= rd=20 to make it a defining issue--and one they had hoped would help them win=20 control of the House in the 2002 elections. ?????It's hard to describe to people what the difference is between what w= e=20 want and what FERC has done said the aide. ?????And Republicans said FERC's action had clearly taken the wind out of t= he=20 sails of price control efforts that some GOP strategists feared might have= =20 passed the House. ?????I would have thought [it would pass] last week said John Feehery= =20 spokesman for House Speaker J. Dennis Hastert (R-Ill.). But now with what= =20 FERC did it takes a lot of air out of the balloon. ?????I think the FERC action will dissipate that strong push agreed Emil= y=20 Miller a spokeswoman for House Majority Whip Tom DeLay (R-Texas). It will= =20 take the heat off. ?????House Majority Leader Dick Armey (R-Texas) said the message to Democra= ts=20 was It's time to come off your political high horse. ?????He said he wanted to keep Democrats from offering their price control= =20 amendment to Wednesday's supplemental appropriation bill because the propos= al=20 is a political statement not a policy statement. ---=20 ?????Times staff writers Megan Garvey and Richard Simon contributed to this= =20 story. Copyright 2001 Los Angeles Times=20 Plan Won't Raise Rates Davis Says=20 Edison: Governor seeks to assure Senate where Democrats say action is a=20 bailout of nearly bankrupt utility.=20 By CARL INGRAM Times Staff Writer=20 ?????SACRAMENTO--Gov. Gray Davis sought to assure the state Senate on Tuesd= ay=20 that his plan to save Southern California Edison from threatened financial= =20 collapse would work without increasing customer rates. ?????Davis sent assurances to the Senate Energy Committee through his top= =20 attorney Barry Goode who helped negotiate the controversial proposal with= =20 the utility. ?????Senate Republicans have taken a wait-and-see attitude on the plan. But= =20 they generally contend that the business of utilities belongs in the hands = of=20 private enterprise. ?????But Democrats in both houses have charged that the deal between Democr= at=20 Davis and Edison represents a state bailout of the nearly bankrupt=20 Rosemead-based utility. The analysis is shared by leading consumer activist= s. ?????At the first in a series of Senate hearings on the package which is= =20 considered all but dead in its current form Sen. Byron Sher (D-Palo Alto)= =20 voiced concerns about political problems with the plan. ?????He asked Goode who was flanked at a witness table by Edison executive= s=20 whether monthly bills of the utility's customers would increase as a=20 consequence of approval of the governor's package. ?????Our models say there will be no additional impact on the ratepayers= =20 Goode replied. ?????Other members appeared ready to pursue rate increase questions but=20 Chairwoman Debra Bowen (D-Marina del Rey) cut them short. She said the issu= e=20 would be fully examined at a later hearing. ?????To spare Edison from going into bankruptcy and to restore its=20 credit-worthiness Davis and executives of the utility reached a complex=20 compromise in April the centerpiece of which was a state purchase of=20 Edison's transmission grid for about $2.8 billion more than twice its book= =20 value. ?????Edison has estimated that it owes $3.5 billion to creditors including= =20 wholesale power generators as a result of deregulation of retail electrici= ty=20 prices in 1996. ?????Because of a freeze in retail rates Edison was prohibited from passin= g=20 its energy costs to customers. ?????Other features of the deal include dedicating a portion of consumer=20 rates to help pay off the debt a guaranteed 11.6% rate of return to Edison= =20 on its sales and investments and termination of an ongoing Public Utilitie= s=20 Commission investigation into financial dealings of Edison's parent company= =20 Edison International. ?????The energy committee held the hearing for fact-finding purposes and di= d=20 not consider the Edison bill SB 78x by Sen. Richard Polanco (D-Los Angeles= ). ?????But the Davis-Edison deal has angered consumer activists who contende= d=20 that bankruptcy for Edison would be preferable. ?????They deplored it as a bailout that would cost Edison customers $5=20 billion to $7 billion. ?????If the Legislature makes the mistake of forcing the ratepayers of=20 California to pay one more penny to bail out these companies we will put [= an=20 initiative] right on the ballot said Harvey Rosenfield of the Foundation= =20 for Taxpayer and Consumer Rights. ?????Consumer organizations in 1998 put to the voters an initiative to junk= =20 the 1996 deregulation law. The measure failed. ?????Rosenfield Harry Snyder of Consumers Union and Matt Freedman of the= =20 Utility Reform Network all asserted at a news conference that the Davis=20 rescue program should be killed. ?????Snyder who opposed deregulation said the governor's bill is shaping = up=20 as a replay of 1996. ?????It's too big too complicated. . . . This is the same process that=20 brought about this [deregulation] disaster Snyder said. ?????Separately San Diego Gas & Electric agreed Monday to sell its=20 transmission grid to the state for about $1 billion on the same terms as=20 Edison. ?????With all the controversy surrounding the Edison deal the chance of=20 SDG&E winning legislative approval of its sale is slightly better than 50%= =20 said Stephen L. Baum chief executive of Sempra Energy parent of SDG&E. ?????I think there's a widely shared view in the Legislature that they don= 't=20 want the state in the long-term business of power procurement. . . . In ord= er=20 to get Edison back into that business there has to be this infusion of=20 capital to pay off past electricity debts and make the utility=20 credit-worthy Baum said. ---=20 ?????Times staff writer Nancy Rivera Brooks contributed to this story. Copyright 2001 Los Angeles Times=20 State to Pay Electric Bill With Loan Not Taxes=20 By MIGUEL BUSTILLO Times Staff Writer=20 ?????SACRAMENTO--California taxpayers who have had to bankroll billions of= =20 dollars in electricity purchases for the teetering power utilities will so= on=20 no longer see their money evaporate at record rates under an executive ord= er=20 by Gov. Gray Davis. ?????As early as next week the order will stop the hemorrhaging of the sta= te=20 budget by allowing Treasurer Phil Angelides to borrow $5 billion to buy=20 electricity. That money is expected to cover power purchases until this fal= l=20 when the state plans to sell an unprecedented $12.5 billion in bonds to rep= ay=20 the general tax fund and buy future electricity. ?????Angelides said Tuesday that he has already lined up $3.5 billion in=20 loans from two Wall Street firms and expects to secure at least another=20 billion by next week when he plans to close the deal and obtain the money. ?????The loan is critical he said because without it electricity purchas= es=20 would completely deplete state coffers as early as October. ?????In essence it stops the general-fund bleeding Angelides said. Wha= t=20 this interim financing does is take the pressure off the general fund and= =20 hopefully avert a cash crisis. ?????The loan could also ease concerns on Wall Street that California's ris= ky=20 entry into the power business has placed the state budget in a precarious= =20 position. Those concerns were one of the main reasons two major credit rati= ng=20 agencies downgraded the state earlier this year. ?????We have been looking forward to this day said Ray Murphy a vice=20 president at Moody's Investors Service one of the two firms that downgrade= d=20 California's credit rating. We view this as a positive first step toward= =20 getting the state out of the power business. We wanted the state to get the= =20 general fund out of the business as quickly as possible. ?????California has allocated $8.2 billion in taxpayer money for electricit= y=20 since January because the state's private utilities became too saddled with= =20 debt to continue purchasing power on the open market. and massive blackouts= =20 loomed. ?????Under a plan devised by Davis and approved by the Legislature the sta= te=20 budget is supposed to be reimbursed for the power purchases with the bond= =20 issue the largest in American history. The bonds in turn are to be paid= =20 off by utility ratepayers through their monthly bills. ?????The bond issue however has been delayed by partisan politics and=20 complex legal issues raised by the bankruptcy of Pacific Gas & Electric Co.= =20 the state's largest private utility. ?????A bond sale initially planned for May is now scheduled for late=20 September according to Angelides' latest estimate. The state's Public=20 Utilities Commission still needs to take a number of technical actions befo= re=20 the sale can take place. ?????As a result the state budget has been drained for power purchases far= =20 longer than initially anticipated--a situation that has imperiled spending = on=20 education transportation and other critical needs at least temporarily. ?????Angelides had earlier sought to secure a $4-billion bridge loan to rep= ay=20 the state budget for power purchases until the bonds were sold but was=20 rebuffed by Republicans in the Legislature who argued that the loan was no= t=20 necessary. ?????Davis' executive order issued late Monday as part of the Democratic= =20 governor's emergency powers during the energy crisis gives Angelides the= =20 authority to press ahead. ?????But it does not allow the treasurer to use the loan to repay the budge= t=20 for the billions spent so far this year on electricity as he had originall= y=20 intended. Rather it permits Angelides to use the loan proceeds to assist t= he=20 Department of Water Resources the state agency buying power with its futu= re=20 electricity expenses. ?????If the bond issue is further delayed Angelides estimated the loan=20 would gives California another four to six months before it would begin to= =20 run out of money. Furthermore the loan closes a potential loophole that=20 existed in the long-term contracts Davis had signed to stabilize the cost o= f=20 electricity which would have let power suppliers walk away from the deals = if=20 the state had not secured a source of financing by next month. ?????But Republicans warned that by entering into a bridge loan deal withou= t=20 knowing when the bonds would be sold Davis and the Democrats were incurrin= g=20 major risks that could further drive up the price tag of the crisis. ?????The loan carries a blended interest rate of about 4.5% but if it is n= ot=20 repaid by Oct. 31 the rate jumps to 7%. Because the loan is to be repaid b= y=20 the bonds which have been marred by a history of delay GOP officials=20 Tuesday were already calling the bridge loan a bridge to nowhere. ?????The thing that is most troubling is that the governor did not bother = to=20 consult with anyone said Assembly Republican leader Dave Cox (R-Fair Oaks= )=20 who learned of Davis' order from reporters. It's disappointing but the=20 governor does not seem to recognize there is a legislative branch. Copyright 2001 Los Angeles Times=20 Edison Unveils Blackout Warning Plan=20 Technology: The utility will notify customers by Internet and telephone whe= n=20 power might go out.=20 By DANIEL HERNANDEZ Times Staff Writer ?????Southern California Edison on Tuesday unveiled a system that will=20 forecast coming blackouts over the Internet and by telephone.=20 ?????Ordered by the state to create a warning system for customers as=20 California enters a summer that will almost certainly include rotating=20 blackouts Edison is also preparing to use automatic phone calls faxes and= =20 wireless communications to alert subscribers to outages.=20 ?????With these steps Edison is complying with an order by the state Publi= c=20 Utilities Commission which in April told the company to notify customers o= f=20 coming outages. Privately held Pacific Gas and Electric Co. established a= =20 similar program months ago.=20 ?????Edison previously opposed a notification system arguing that such a= =20 system could incite looters and burglars. But police agencies including th= e=20 Los Angeles County Sheriff's Department saw more danger in not warning=20 customers said Richard Rosenblum an Edison senior vice president. ?????On balance [we concluded] it was preferable for public safety to mak= e=20 that information available Rosenblum said. ?????Consumer advocates said Edison's notification system is welcome if=20 tardy. ?????It's fair to say that Edison has been a little behind where PG&E has= =20 been in trying to implement this said Mike Florio an attorney with the= =20 Utility Reform Network and a member of the California Independent System=20 Operator board which runs the state power grid. ?????Edison's Web site www.sce.com now features a pop-up screen that warn= s=20 of any blackouts coming in the next hour. It also links to a page which ca= n=20 be reached at www.outagewatch.com that forecasts which outage groups wil= l=20 be cut off next in the event of rotating blackouts. Detailed maps outline= =20 which areas are included in each group.=20 ?????The new Web features are expected to handle about 4 million simultaneo= us=20 users. Beginning this month Edison customers also can learn their block=20 number by looking at their bills said Edison spokesman Gil Alexander. ?????Outage information also will be made available on an automated phone= =20 line (800) 611-1911. ?????Edison officials are negotiating with another company to provide=20 additional warnings by e-mail fax phone and wireless communications. SDG&= E=20 which like Edison was required to inform customers of outage forecasts has= =20 moved more quickly providing large industrial customers with blackout=20 notification via pager since June 4. ?????Up-to-the-minute outage reports also will be provided in several=20 languages to radio and TV stations Edison officials said. ?????Edison officials emphasized that the new alert system can never be 100= %=20 accurate and that sudden blackouts although rare are always a possibilit= y.=20 ?????We have planned as aggressively as we think is warranted understandi= ng=20 that you can't predict how your customers will respond Alexander said. Copyright 2001 Los Angeles Times=20 State Joins Challenge to Bush on Air-Conditioner Standards=20 Regulations: U.S. rolled back Clinton rule from 30% increase in efficiency = to=20 20% on manufacturers' urging.=20 By JENIFER WARREN Times Staff Writer=20 ?????California and two other states joined environmentalists Tuesday in=20 suing the Bush administration over its decision to weaken efficiency=20 standards for home air conditioners. ?????The lawsuit caps weeks of criticism heaped on the administration after= =20 it rolled back a rule requiring manufacturers to increase the efficiency of= =20 air conditioners 30% by 2006. ?????That rule was adopted by President Clinton during his final days in=20 office and after years of research and debate. California and other=20 states--including Texas--endorsed it as a way to substantially cut energy u= se=20 and improve air quality. ?????But after reviewing the rule at the industry's behest Bush=20 administration officials in April sliced the mandated increase to 20%. The= =20 higher standard they said would have made home coolers too expensive=20 especially for the poor. ?????Conservationists and consumer groups blasted the policy change callin= g=20 it shortsighted at a time when California and other states are enduring an= =20 energy crunch. ?????In California residential air-conditioning accounts for about 15% of= =20 the peak energy demand. Weakening efficiency standards critics say will= =20 require as many as 60 new power plants nationwide four in California. ?????This is a time when we need to conserve electricity and reduce our=20 dependence on the large energy generators and importers state Atty. Gen.= =20 Bill Lockyer said in an interview. Weakening this standard is precisely th= e=20 wrong message at precisely the wrong time. ?????In their lawsuit Lockyer and the attorneys general of New York and=20 Connecticut allege that federal law bars the U.S. Department of Energy from= =20 softening an appliance efficiency standard. A separate but similar suit was= =20 filed by the Natural Resources Defense Council the Consumer Federation of= =20 America and another nonprofit group. ?????Joe Davis the Energy Department's deputy spokesman said there would = be=20 no immediate comment on the suit filed in federal court in Manhattan. He= =20 added however that we believe all of the actions of our decision-making = in=20 the air conditioner standards are well within the law. ?????When Clinton's rule was issued in January his outgoing energy=20 secretary Bill Richardson said the payoff in power savings and cleaner ai= r=20 would be one of the administration's greatest environmental achievements. ?????But a trade association representing air conditioner manufacturers=20 challenged the new rule arguing that it would dramatically increase costs = of=20 the units--priced between $2000 and $4000--and thus discourage people fro= m=20 replacing old ones. ?????The Department of Energy sided with the industry group in April.=20 Officials said Clinton's proposal would have added $335 to the price of a n= ew=20 air conditioner while the lower 20% standard would boost prices only abou= t=20 $213. ?????Others however say those figures do not take into account the=20 economies of scale gained when manufacturers increase production of the mor= e=20 efficient units. When Congress passed the first efficiency standard for air= =20 conditioners in the late 1980s industry said the sky was falling and tha= t=20 it would increase the cost of air conditioners by $700 said Andrew Delask= i=20 executive director of the nonprofit Appliance Standards Awareness Project. = In=20 fact he said U.S. Department of Commerce data showed no price jump. ?????Dan Reicher the assistant secretary of Energy under Clinton who overs= aw=20 development of the stricter standards added that high-efficiency air=20 conditioners are not some exotic untested technology. ?????There are lots and lots of air conditioners already meeting the=20 standards--between 5% and 10% of the units sold today he said. ?????Although most manufacturers support the Bush rollback the second=20 largest maker of air conditioners--Houston-based Goodman Global Holding=20 which produces the Amana brand--opposes it saying any higher upfront costs= =20 would be recovered by consumers in lower utility bills. ?????On Tuesday the company's president John Goodman issued a statement= =20 supporting the lawsuit saying the tougher standard would give consumers a= n=20 enormous cost saving U.S. energy consumption will drop and our environment= =20 will benefit from reduced air pollutant emissions and greenhouse gases. ---=20 ?????Times staff writer James Gerstenzang in Washington contributed to this= =20 story. Copyright 2001 Los Angeles Times=20 New Price Caps Not a Deterrent Power Firms Say=20 Regulation: Producers are unhappy with the federal action but say it is=20 unlikely to discourage them from constructing new plants.=20 By NANCY VOGEL and THOMAS S. MULLIGAN Times Staff Writers=20 ?????The expanded electricity price limits approved by federal regulators= =20 could squeeze big energy traders but will probably not discourage power pla= nt=20 construction in California electricity producers said Tuesday. ?????Power plant owners and marketers said they had not had time to digest= =20 the 53-page order and thus could not say exactly how it would affect=20 California and the 10 other Western states it covers. ?????But the companies generally asserted Tuesday that the order would not= =20 deter them from investing in the vast power-starved Western region--though= =20 they have often raised such a prospect in arguing against price controls. ?????Whatever its long-term effects Monday's order by the Federal Energy= =20 Regulatory Commission appeared to have an immediate effect in dampening=20 prices in California's volatile daily or spot market. ?????The order does not take effect until today but the prospect of new=20 measures aimed at limiting prices appeared to tame markets Tuesday.=20 Californians used more electricity at the late-afternoon peak than on any d= ay=20 this year yet market prices hovered around $100 a megawatt-hour. ?????That is well below the average of $284 a megawatt-hour that the state= =20 paid for electricity from January through April with prices soaring as hig= h=20 as $1900 at times of tight supply. ?????All the markets in the West have come down said Mike Wilczek senio= r=20 power markets reporter for Platts the energy market information division o= f=20 the McGraw-Hill Cos. It's bearish news. ?????Nevertheless several generators minimized the effects of the FERC=20 order contradicting earlier warnings from some industry sources and=20 officials of the Bush administration who consider price limits to be=20 impediments to future investment in power plants. ?????Calpine will have no problem operating under this order said Joe=20 Ronan vice president of regulatory affairs for San Jose-based Calpine Corp= .=20 which has three power plants under construction in California and plans to= =20 build at least three others. ?????The federal order lasts only until September 2002 he said and becaus= e=20 it sets prices based on the cost of running the most expensive inefficient= =20 power plant in the market it should guarantee the owners of modern plants = a=20 profit. ?????Another company planning major investments in California Duke Energy= =20 Corp. of North Carolina said it will not be seriously affected by the=20 federal order because it has sold the output of its four California plants= =20 well into the future. ?????We've already forward-sold 90% of our generation for 2001 and 70% for= =20 2002 company spokesman Pat Mullen said. ?????Reliant Energy Inc. of Houston which owns five power plants in=20 California was not so sanguine about the federal order but it has not=20 backed away from plans to install more generators. ?????We remain committed to California as hard as it is to do business he= re=20 today spokesman Richard Wheatley said. We have plans that are on the=20 drawing boards for at least one possibly two projects. ?????On Monday Reliant Chief Executive Joe Bob Perkins called the FERC=20 action more of a political response than an acknowledgment of the gap=20 between electricity supply and demand in California. ?????Price caps don't work Perkins said and he warned California=20 consumers against assuming that the energy crisis is over simply because=20 wholesale electricity prices have recently dropped to their lowest levels i= n=20 a year. ?????Prices are falling because of mild weather not price controls he sai= d. ?????Without sound economics that increase available supply and reduce pea= k=20 demand . . . consumers can only hope for favorable weather and look forward= =20 to [rolling blackouts] Perkins said. ?????Energy analyst Frederick Schultz of Raymond James & Associates in=20 Houston called the FERC order a nonevent to the California generators=20 because so much of their power is now being sold through long-term contract= s. ?????However every long-term deal reduces the size of the electricity=20 market which supplies about 20% of California's needs. And that in turn= =20 limits trading opportunities for such firms as Enron Corp. which profit on= =20 the daily market's ups and downs Schultz said. ?????Enron representatives did not respond to calls for comment. ?????The federal order imposes round-the-clock price curbs on wholesale=20 electricity sold in 11 Western states that are connected by transmission=20 grids. ?????Under the order traders say market prices will probably hover around= =20 $100 a megawatt-hour depending upon the price of the natural gas that fuel= s=20 most of the state's electric generating plants. Though that is well below= =20 recent market prices it is higher than the average of about $32 a=20 megawatt-hour that California utilities paid in 1999 before the state's=20 deregulated market spiraled out of control. ?????The FERC order dictates that the price for spot market electricity=20 across the West will be based on the cost of producing one megawatt-hour of= =20 power at the least-efficient plant selling to California grid operators. Ma= y=20 31 when a previous FERC order based on a similar formula took effect the= =20 price set was $127 a megawatt-hour. ---=20 ?????Vogel reported from Sacramento Mulligan from New York. Copyright 2001 Los Angeles Times=20 Wednesday June 20 2001=20 The FERC's Action Is Good BadUgly=20 By PETER NAVARRO ?????The Federal Energy Regulatory Commission's new wholesale price caps wi= ll=20 save the Western states literally tens of billions of dollars in electricit= y=20 bills. As wonderful as that sounds the FERC order still allows wholesale= =20 generators to extract enough windfall profits to drive the region into=20 recession.=20 ?????The FERC's approach may also perversely lead to more air pollution and= =20 natural gas shortages.=20 ?????Let's look at what the FERC did right. First the order approved Monda= y=20 establishes price caps on a 24/7 basis rather than simply during power=20 emergencies--a long overdue reform.=20 ?????Second the order protects the entire West not just California. This= =20 regional cap will end megawatt laundering whereby in-state generators so= ld=20 power across California lines and then resold it back into the state to eva= de=20 caps.=20 ?????Third the order closes the ridiculous broker loophole that made the= =20 FERC's previous price caps Swiss cheese. Before generators could redirect= =20 their sales from the market to energy brokers who were exempt from the pric= e=20 caps.=20 ?????So where did the FERC go wrong? The problem may be traced to the two= =20 competing methods of imposing price caps and the all-important concept of= =20 economic rent.=20 ?????Economic rent in the wholesale electricity market is the market pric= e=20 of electricity minus the producer's cost where cost includes not just labo= r=20 and fuel but a fair profit on the invested capital as well. In traditiona= l=20 regulation this fair profit is calculated very simply as the market cost o= f=20 the money borrowed to build the power plant.=20 ?????Under this definition if the producer's cost is a nickel a kilowatt= =20 hour and he can sell it for 35 cents--as producers in the West have been=20 doing--the producer can extract 30 cents of economic rent from consumers.= =20 ?????In California the extraction of such economic rent through market=20 manipulation has taken place on a grand-theft scale. In 1999 California's= =20 electricity bill was about $7 billion. Last year it was almost $30 billion= =20 for roughly the same amount of electricity. This year California's bill is= =20 well on its way to $50 billion annually.=20 ?????To stop this rip-off Gov. Gray Davis proposed cost-based price caps= .=20 Such caps are calculated on a plant-specific basis. Each generator is allow= ed=20 to recover its cost of production including the fair profit but not a pen= ny=20 more.=20 ?????Thus for example a newer highly efficient plant generating power at= a=20 nickel per kilowatt hour would collect a nickel. The oldest least efficien= t=20 plant that generated power for 20 cents would be allowed to collect 20 cent= s.=20 ?????By setting different prices for different plants the economic rents a= re=20 driven to zero. Yet each generator still has a fair profit incentive to=20 produce. From a public policy perspective it's the best of all possible=20 worlds. And it was categorically rejected by the FERC. Instead the FERC se= ts=20 a single price for all generators based on the cost of the least efficient= =20 plant.=20 ?????The obvious problem with this umbrella pricing rule is that it still= =20 allows generators to extract billions in economic rent from consumers.=20 ?????In our previous example and under the FERC's rule the least efficien= t=20 plant still collects 20 cents a unit to recover costs. However the most=20 efficient plant producing power at a nickel-per-kilowatt also collects 20= =20 cents rather than a nickel and thus extracts a full 15 cents of economic=20 rent.=20 ?????Thus under the FERC's rule wholesale generators still will be able t= o=20 capture tens of billions of dollars more from consumers and businesses than= =20 under Davis' cost-based rule.=20 ?????The FERC's approach is still subject to the same kind of strategic=20 gaming that has been the hallmark of this crisis. Generators will ensure th= at=20 during peak times when the price cap is being established the most=20 expensive possible plant is in operation--whether it needs to be or not. Th= is=20 will peg the price at the highest level.=20 ?????In addition the FERC provides generators with a perverse incentive to= =20 run their least efficient units more often. Since these least efficient=20 plants are also the highest polluting the result will be dirtier air.=20 Moreover the excessive running of these plants may also put a strain on=20 already stretched natural gas supplies. These least efficient plants use up= =20 to 40% more natural gas to produce a unit of electricity.=20 ?????The bottom line: The FERC done good. But it could have done a lot=20 better. And the way things stand now there still is a danger that higher= =20 electricity costs could push California and the rest of the West--and=20 eventually the nation--into a nasty recession.=20 - - - Peter Navarro Is an Associate Professor of Economics and Public Policy at U= c=20 Irvine. E-mail: Pnavarro@uci.edu Copyright 2001 Los Angeles Times=20 Davis OKs stopgap loan=20 CRISIS POWERS: Action sidesteps Legislature=20 Greg Lucas Sacramento Bureau Chief Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 Circumventing the Legislature Gov. Gray Davis used his emergency powers=20 yesterday to authorize borrowing up to $5 billion for energy purchases in= =20 advance of a record bond issue.=20 Sidestepping the Legislature with a stroke of the pen Davis' action=20 indicates that the state may need more time to prepare a $12.5 billion bond= =20 issue this fall the largest sale of its kind in history.=20 The Democratic governor's action was swiftly assailed by the Republican=20 leadership.=20 This is not a dictatorship. It's a democracy said Assembly GOP leader Da= ve=20 Cox of Carmichael. There is a judiciary a legislative side and an executi= ve=20 side and everyone has roles and responsibilities. Yet we continue to have= =20 the governor say 'I'm the only one around here that makes any difference.= =20 The rest of you shall do my bidding.' =20 Normally it is the Legislature that has the power to raise and spend money= =20 and a governor may not spend a cent unless lawmakers allow him to.=20 But Davis has broad powers under the state of emergency which he declared = in=20 January to combat California's energy crisis.=20 NO ADVANCE NOTICE The governor's aides declined to comment on yesterday's executive order and= =20 gave no advance notice of it.=20 This executive order authorizing a bridge loan will allow us to get=20 California's General Fund out of the power-buying business was the=20 governor's only comment in a written statement issued last night.=20 State Treasurer Phil Angelides said lawyers had advised him and the governo= r=20 that such borrowing could be authorized by an executive order.=20 The loan from Wall Street will temporarily fill the $5.2 billion -- and=20 growing -- hole in the state budget created when the state began buying=20 electricity on behalf of the state's cash-starved utilities in January.=20 The idea is to tide the state over until a larger bond sale of $12.5 billio= n=20 can be arranged later this year. A portion of that sale will pay back the= =20 $5.2 billion borrowed from Wall Street.=20 'STOPS THE BLEEDING'=20 It stops the general fund bleeding said Angelides. It takes the pressur= e=20 off and hopefully we'll avert a cash crisis.=20 The state runs out of internal borrowing power sometime in October. Angelid= es=20 said the loan would buy the state another four to six months.=20 The idea of a loan was floated earlier this year.=20 Cox and other GOP lawmakers objected wondering why the state should pay=20 interest on borrowed money when it could still borrow from various accounts= =20 within the state budget.=20 They refused to vote for a bill authorizing the larger bond sale of $12.5= =20 billion forcing a delay in issuing it until at least Aug. 14.=20 The idea of borrowing from Wall Street appears to have been abandoned sinc= e=20 both Davis administration and legislative budget-writers said the state cou= ld=20 keep borrowing internally into October well after the bond sale.=20 Yesterday's executive order authorizing the borrowing suggests that neither= =20 Angelides nor Davis are confident that the steps needed to prepare the $12.= 5=20 billion bond issue for market can be completed before then.=20 Angelides had previously said he hoped to sell the bonds in early September= .=20 Yesterday he said the governor's hope is to still sell long-term bonds by= =20 Sept. 30.=20 ACT OF DESPERATION? Sen. Tom McClintock R-Northridge described the executive order as an act = of=20 desperation that would suggest they are expecting the large bond sale to= =20 occur later rather than sooner.'=20 Numerous actions must be completed before the bond sale.=20 Among them are the approval by the Public Utilities Commission of several= =20 deals with the state and utilities to ensure that enough money from=20 consumers flows back to bond buyers to pay off interest and principal.=20 Although Davis' executive order authorizes $5 billion in loans Angelides h= as=20 only lined up $3.5 billion.=20 So far only two lenders have come forward to offer the state a loan J.P= =20 Morgan with $2.5 billion and Lehman Brothers with $1 billion at an interes= t=20 rate of 4.5 percent. If the long-term bonds are not sold by Oct. 31 that= =20 will increase to 7 percent.=20 Angelides said he hoped to line up another $1 billion by next week when th= e=20 loan deal occurs.=20 Assuming a loan of $4.5 billion Angelides said the state would pay out $8= =20 million in fees.=20 E-mail Greg Lucas at glucas@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 Experts say state must seize the day=20 ANALYSIS: Price caps set stage for future=20 David Lazarus Chronicle Staff Writer Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL: DTL=20 One day after federal authorities ordered long-sought electricity price cap= s=20 throughout the West analysts said yesterday it is up to California to=20 respond with measures to bring an end to the state's long frustrating=20 experiment with deregulation.=20 Possible steps the experts point to include raising power bills easing=20 pollution controls and spending billions of dollars in taxpayers' money on= =20 new plants.=20 Gov. (Gray) Davis and his team have been making this up week by week sai= d=20 Paul Joskow director of the Center for Energy and Environmental Policy=20 Research at the Massachusetts Institute of Technology.=20 It's time for them to get together with the Federal Energy Regulatory=20 Commission (FERC) to come up with some solutions he said. The state need= s=20 to get down to business and decide how the power market is going to look 18= =20 months from now.=20 Easier said than done. To date California's strategy for tackling its ener= gy=20 woes largely has consisted of wheedling cajoling and all but begging feder= al=20 officials to come to the rescue.=20 Now that the federal regulators have gone much of the way toward granting t= he=20 state's wishes analysts said Davis and other officials must act swiftly an= d=20 decisively to further remedy California's prolonged power troubles.=20 For his part however the governor feels that federal regulators have not= =20 done enough. He will push today during congressional hearings in Washington= =20 for billions of dollars in refunds for California ratepayers.=20 FERC has taken some first steps but the proverbial fat lady hasn't sung= =20 said Steve Maviglio a spokesman for Davis.=20 This persistent focus on federal assistance could slow progress toward a=20 lasting solution to California's problems some analysts believe.=20 We are still likely to experience blackouts this summer said Michael=20 Zenker director of Cambridge Energy Research Associates in Oakland. It's= =20 not yet clear that the state will do what it can to address other aspects o= f=20 the problem.=20 Put simply such steps would require enormous political courage -- and woul= d=20 be very expensive. In the end taxpayers and ratepayers will bear the burde= n=20 for this prolonged fiasco.=20 Among measures under consideration:=20 -- Raising electricity rates even higher. Although Californians got the=20 largest rate increase in state history last month even higher charges woul= d=20 promote conservation and lessen the need for California to borrow billions = of=20 dollars in the bond market.=20 -- Loosening emissions restrictions for power plants statewide. This would= =20 provide more electricity during shortages but turn back the clock on=20 California's strict environmental standards.=20 -- Building new plants at taxpayers' expense. This would guarantee a steady= =20 supply of juice but would leave the state struggling for years to recoup th= e=20 huge investment costs.=20 Of the three easing pollution controls is the easiest first step and the= =20 most likely analysts said. Such environmental protections have been roundl= y=20 criticized by power industry officials who claim the restrictions have=20 hampered the construction of new generating plants.=20 Taxpayer-financed power plants are possible under a new state power authori= ty=20 backed by the governor but the timing and financing remain undecided.=20 Higher electricity rates could be the toughest move to make analysts agree= .=20 They note that Davis will seek re-election next year and doesn't want to be= =20 seen as the governor who sent voters' power bills into the stratosphere.=20 Already critics are trying to paint him as the governor who was asleep at= =20 the power switch.=20 As federal regulators were moving at last on the price-cap front this week= =20 another big development took place closer to home Monday when Davis disclos= ed=20 a tentative deal with Sempra Energy's San Diego Gas & Electric Co. The plan= =20 calls for the state to purchase the utility's 1800 miles of power lines fo= r=20 nearly $1 billion.=20 As with a similar accord reached with Southern California Edison the Sempr= a=20 deal is intended to counter the catastrophic effects of California having= =20 deregulated wholesale power prices but not allowing the state's utilities t= o=20 pass on costs to customers.=20 Between them California's three major utilities have rung up more than $15= =20 billion in debt.=20 Here too the state appears unsure how to proceed. Both the Sempra and=20 Edison agreements require approval from the Legislature. It's anyone's gues= s=20 whether such approval is forthcoming.=20 It's going to be a really really tough sell said Nettie Hoge executive= =20 director of The Utility Reform Network in San Francisco. These aren't=20 fabulous deals.=20 ONE SCENARIO FOR UTILITIES Rather she believes the agreements will be reworked so that less taxpayer= =20 money changes hands while allowing the utilities to retain possession of=20 their power systems.=20 Hoge said this could subsequently influence a speedy resolution of Pacific= =20 Gas and Electric Co.'s bankruptcy proceedings. If it can avoid selling off= =20 key assets like power lines PG&E may be more open to any settlement plans= =20 put forward by the state.=20 The utilities are all going to end up with similar deals Hoge forecast.= =20 State Senate President Pro Tem John Burton D-San Francisco isn't so sure.= =20 He observed that the Edison deal hinges on a sale of the utility's power=20 lines to the state while the Sempra accord could stand even without such a= =20 transaction.=20 The two deals are totally unrelated Burton said adding that approval of= =20 the Edison accord is very much in flux. A bankruptcy filing by the state'= s=20 second-largest utility remains a distinct possibility he said.=20 This would only increase the importance of price caps in bringing some=20 stability back to California's power market.=20 While the state's current rate freeze will continue cushioning consumers fr= om=20 the volatility of wholesale electricity prices the caps -- or price=20 mitigation as federal regulators are calling it -- will limit the amount= =20 that power generators can charge on the open market.=20 SYSTEM HAS FLAWS It is not a perfect system: Power companies can base prices on the cost of= =20 running the least-efficient -- and thus costliest -- generating facility. B= ut=20 this amount almost certainly will be below some of the more outrageous pric= es=20 seen when the sky was the limit.=20 On at least one occasion this year California's wholesale power price topp= ed=20 $3000 per megawatt hour compared with just $30 about a year ago.=20 This is a plan that is good for California good for the Pacific Northwest= =20 and good for the entire West said FERC Chairman Curt Hebert.=20 That remains to be seen. As it stands the price caps will remain in effect= =20 through next summer.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 California's energy crisis hits Northwest like a tidal wave=20 Jeff Hammarlund Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/E D165509.DTL=20 THERE WAS a time when many Northwesterners thought we could watch=20 California's energy crisis from a safe distance.=20 We have since learned that a major energy crisis does not stop at the Golde= n=20 State's borders but instead rolls over the Northwest like a tidal wave= =20 wreaking havoc with our economy and overwhelming our carefully crafted ener= gy=20 policies.=20 As one Northwest utility official put it We learned that everyone else is= =20 the tail. California is the dog.=20 To understand why the Northwest is now facing its own energy crisis and how= =20 the energy problems in the Northwest and California each affect each other= =20 one must understand how the Northwest gets its power.=20 In the Northwest falling water is our primary fuel. Depending on the=20 available snowpack hydroelectricity produced at more than 200 dams in the= =20 Columbia River basin generates between 60 and 75 percent of the region's=20 electricity. About two-thirds of this hydropower comes from 29 dams owned a= nd=20 operated by the two federal agencies the U.S. Army Corps of Engineers and= =20 the Bureau of Reclamation.=20 By taking advantage of the region's geography and climate the Columbia's= =20 hydroelectric dams have produced some of the least expensive electricity in= =20 the nation power that has been the economic backbone of the region.=20 However the Columbia's hydrosystem also has two curses.=20 One is that water conditions can vary greatly and right now the Northwest= =20 and California are in the middle of an extreme drought. The second is the= =20 dams' negative impact on salmon. These dams operate under a federal salmon= =20 recovery plan established under the Endangered Species Act that calls for= =20 more water to be sent over spillways to help push the salmon downstream=20 instead of through the dams' power-generating turbines.=20 That power is sold at cost and transmitted to Northwest consumer-owned=20 utilities by yet another federal agency called the Bonneville Power=20 Administration. These cost-based rates cover the expense of repaying the= =20 U.S.=20 Treasury for the cost of developing these hydropower projects moving the= =20 power over massive transmission lines and supporting efforts to restore th= e=20 dwindling salmon runs.=20 Under federal law Northwest consumers get preferred access to the relative= ly=20 low-cost power. Any surplus power can be sold most often to California's= =20 municipal and investor-owned utilities.=20 This Northwest regional preference to federal power was part of the deal= =20 that led to the construction of the massive transmission lines called the= =20 intertie which first connected the Northwest with California and the=20 Southwest in the late 1960s.=20 For decades the intertie worked almost flawlessly and to everyone's benefi= t.=20 During the summer when air conditioners caused California's power use to= =20 peak many California utilities would supplement their needs by turning to= =20 the Northwest. In the winter when Northwest electric furnaces are turned o= n=20 for space heating California utilities would return the favor and ship the= ir=20 surplus power north.=20 Recently the BPA has had to purchase large blocs of power on the wholesale= =20 market to meet its contractual obligations to its Northwest customers.=20 The same exorbitant wholesale prices that began to plague California last= =20 year have also affected the Northwest meaning that the BPA has been runnin= g=20 out of money and is now in danger of defaulting on its debt obligations to= =20 the Treasury.=20 California's deregulation plan has affected energy relations between the tw= o=20 regions in other ways. For example the BPA has historically sold surplus= =20 power to California for relatively low prices. However the state's=20 deregulation law made it almost impossible for California utilities to ente= r=20 into favorable long-term contracts.=20 Instead power had to be purchased at the much higher market clearing pric= e=20 on the short-term spot market.=20 The BPA has taken extraordinary steps to help California keep the lights on= .=20 At times the agency even declared energy emergencies which allowed it to= =20 temporarily override salmon protections and use the water to generate power= =20 for California rather than sweep salmon over the dams. California officials= =20 have praised the BPA for its cooperation but Northwest environmentalists a= nd=20 tribal leaders complain that the BPA has been helping California address it= s=20 energy crisis by selling salmon down the river.=20 The Northwest will be helped by FERC's decision yesterday to extend limited= =20 temporary price restrictions it had imposed in California in the spring to= =20 other Western states during severe shortages. The order should also be good= =20 for California. Without consistent price restrictions throughout the West= =20 power marketers would simply skip California during an emergency and sell a= t=20 higher prices elsewhere.=20 But not everyone is happy with the decision. Many critics say the rates are= =20 still too high and some critics said in s published report that the order= =20 rewards inefficiency by pegging price ceilings to the costliest California= =20 gas plants.=20 The half-hearted response from FERC along with continuing supply shortages= =20 and other problems make it likely that California will continue to face=20 rolling blackouts and high utility bills -- even though they may not be as= =20 high as we once feared.=20 The Northwest may follow suit next winter.=20 Some in our region fear that some desperate California political leaders=20 might try to wrest control of the BPA and a large portion of the Columbia= =20 Basin's hydropower. The 6600 megawatts of hydropower from the Columbia's= =20 federal dams would only offer a few drops in the bucket for California's=20 massive 50000-megawatt system but its loss would devastate the Northwest= =20 economy.=20 The four Northwest governors (of Washington Oregon Idaho and Montana) and= =20 more than 40 state legislators met in February and agreed to explore ways t= o=20 ensure that the Northwest does not lose its regional preference to the=20 Columbia's hydropower.=20 Northwest governors have had some productive meetings with Gov. Gray Davis= =20 and his staff this year regarding power sharing and there are encouraging= =20 signs that trust is growing at this and other levels.=20 Just last week officials from the BPA California's Department of Water=20 Resources and the California ISO agreed on a plan that outlines when and h= ow=20 the BPA may be able to help California during the expected summer shortages= .=20 We will soon find out whether our two regions will succeed in collaborating= =20 with or cannibalizing each other as we enter the next phase of the West Coa= st=20 energy crisis.=20 Ultimately California's experience with energy deregulation makes the case= =20 for a strong and supportive federal role in the energy markets. It also=20 reinforces the view that electricity should be treated as an essential=20 service and be sold at cost by utilities that are owned and controlled by t= he=20 public rather than as a commodity and sold at the highest price.=20 In fact something like a California power authority that places California= =20 in charge of its own destiny makes more sense to me all the time.=20 Jeff Hammarlund is an adjunct associate professor and research fellow at th= e=20 Mark Hatfield School of Government at Portland State University where he=20 teaches graduate courses on energy policy. He is also president of Northwes= t=20 Energy and Environmental Str=20 2001 San Francisco Chronicle ? Page?A - 19=20 Davis demands nearly $9 billion for electricity overcharges=20 H. JOSEF HEBERT Associated Press Writer Wednesday June 20 2001=20 2001 Associated Press=20 URL:=20 ation al1103EDT0569.DTL=20 (06-20) 08:03 PDT WASHINGTON (AP) --=20 California Gov. Gray Davis demanded that power generators refund nearly $9= =20 billion in electricity overcharges and complained that federal regulators= =20 have looked the other way while energy companies bilked our state.=20 Davis told a Senate hearing Wednesday that the decision by the Federal Ener= gy=20 Regulatory Commission to curtail price spikes in California and 10 other=20 Western states was a step forward. But its actions do nothing about the=20 overcharges over the past year he said.=20 The governor a Democrat has been criticized by Republicans who charge he= =20 has allowed the California power crisis to get out of hand.=20 Davis defended his actions saying the state has stepped up approval for ne= w=20 power plants and strengthened conservation programs. He also said the state= =20 has little control over price gouging by out-of-state power generators.=20 The governor once said he could solve California's problems in 15 minutes.= =20 ... But it appears that California has continued to try and hide the true= =20 cost of power by having the state pay for it instead of the utilities=20 putting California taxpayers in jeopardy said Sen. Frank Murkowski=20 R-Alaska.=20 Murkowski said many of the alleged overcharges are by public power entities= =20 not under FERC jurisdiction=20 Sen. Joe Lieberman D-Conn. chairman of the Governmental Affairs Committee= =20 said the FERC which regulates wholesale electricity sales has been slow t= o=20 respond and surprisingly reluctant to assure that electricity prices are= =20 just and reasonable as required by the 1934 Federal Power Act.=20 The agency's response to the Western power problem raises serious question= s=20 about whether (FERC) has or will oversee the newly deregulated energy=20 markets not only in the West but across the rest of the country.=20 The federal agency whose commissioners were to testify later in the day= =20 imposed limited market-based price caps on Monday in California and 10 oth= er=20 Western states from Washington to Arizona. The agency also ordered the=20 parties to attend a conference next week to try to work out agreements on= =20 overcharges and other issues.=20 Months ago the FERC singled out $124 million in alleged overcharges by pow= er=20 generators. The power companies have since challenged the agency's findings= =20 and the matter remains in dispute.=20 To date not a single penny in refunds has been returned to California=20 complained Davis. He said that between May 2000 and the beginning of this= =20 month power generators are believed to have overcharged California $8.9=20 billion.=20 They must be required to give us back our money said Davis. It is=20 unconscionable that FERC looked the other way while energy companies bilked= =20 our state for up to $9 billion.=20 The state spent $7 billion for electricity in 1999 and $27 billion in 2000= =20 and is projected to pay nearly $50 billion this year said Davis. Power=20 generators have been able to exert extreme power over our energy market h= e=20 said.=20 Davis rejected Republican criticism that the state is not addressing the=20 problem. He said newly approved power plants will provide 20000 additional= =20 megawatts of electricity by 2003 including 4000 megawatts by the end of= =20 this summer. Everything that can be done to bring reliable affordable=20 energy to California is being done ... except wholesale price relief he= =20 said.=20 This administration has minimized this crisis (for) more months said Sen= .=20 Patty Murray D-Wash. alluding to President Bush's repeated refusal to urg= e=20 the FERC to mitigate electricity prices. Bush has strongly opposed price=20 controls although he indicated support for FERC's limited price mitigation= =20 effort this week.=20 Murray said the government should issue a disaster declaration so that=20 businesses can get low-income loans and require that FERC press its=20 investigation into price gouging and demand refunds not only in California= =20 but in the Pacific Northwest where electricity prices have also skyrockete= d.=20 Republicans continued their opposition to more stringent price caps based o= n=20 the cost of generation at individual power plants.=20 Having a federal agency try to determine what is a just and reasonable pri= ce=20 is laughable said Sen. Fred Thompson of Tennessee the committee's rankin= g=20 Republican. Hard price caps don't work when supply is the problem. ... The= y=20 make a bad situation worse he said.=20 After FERC issued its limited price control order this week Senate Democra= ts=20 on Tuesday said they would drop legislation to require more stringent=20 cost-based price caps on Western electricity sales.=20 Democrats in the House however said they would continue to pursue a bill= =20 requiring the FERC to take more aggressive action.=20 2001 Associated Press ?=20 Fed price caps placate Demos=20 But Feinstein's bill to regulate energy producers was more strict=20 Carolyn Lochhead Chronicle Washington Bureau Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/M N145950.DTL=20 Washington -- With federal regulators moving to cap prices on wholesale=20 electricity California's Dianne Feinstein and other Senate Democrats=20 yesterday withdrew their threat to do it for them.=20 A rose is a rose by any other name Feinstein declared to the five member= s=20 of the Federal Energy Regulatory Commission the day after they unanimously= =20 imposed a sweeping price ceiling on electricity throughout eleven western= =20 states.=20 I'm very grateful Feinstein told the commissioners who were called to= =20 testify to the Senate Energy and Natural Resources Committee. Let's watch= =20 and wait and see how this order works.=20 Feinstein had been leading the Democratic charge in Washington to force FER= C=20 to impose price controls indeed yesterday's hearing had been intended to= =20 highlight the agency's inaction. Gov. Gray Davis is still billed to appear= =20 today at another Senate panel headed by Sen. Joe Lieberman D-Conn. to=20 investigate price gouging.=20 The 60-page FERC order which takes effect at midnight tonight and remains= =20 until September 2002 limits prices based on the cost of the least-efficien= t=20 and therefore highest-cost generating plant. It is intended to mimic the w= ay=20 a competitive market functions.=20 While Democrats hailed FERC's move power generators and marketers warned= =20 that it would backfire leading to more blackouts and stifling investment i= n=20 new power plants.=20 It doesn't create or conserve a single megawatt in California or the West= =20 said Enron spokesman Mark Palmer. Government price controls always have=20 unintended consequences and history has proven that those have never been= =20 good for consumers.=20 Joe Bob Perkins president and chief operating officer of Reliant Energy= =20 bluntly called the price caps a political response to California's crisis= =20 that ignores the basics of supply and demand.=20 Price caps don't work Perkins said in a statement. This fact has been= =20 proven over and over in the context of virtually every business sector in= =20 which government regulators have experimented with such measures.=20 The Bush administration which has fought electricity price caps since taki= ng=20 office in January yesterday insisted that FERC had actually spurned them.= =20 It's important to note that FERC rejected price controls said White Hous= e=20 spokesman Ari Fleischer who instead called it a market-based mitigation= =20 plan.=20 He added the order is in keeping with the president's desire to help the= =20 state of California and to make certain that there is no illegal price=20 gouging carried on by any companies.=20 FERC's action coincided with the arrival of two new Bush appointees to the= =20 agency Patrick Henry Wood III a former Texas utility regulator and Nora= =20 Mead Brownell a former Pennsylvania regulator.=20 The soft-spoken boyish-looking Wood yesterday sought to allay Feinstein's= =20 lingering concerns that the new price control scheme would still permit=20 generators to manipulate the market.=20 Feinstein's bill would have gone further than the new FERC plan imposing a= =20 cost-of-service based price cap that would return California to the=20 regulatory regime it had before its 1996 electricity restructuring.=20 I am personally not allergic to that sort of remedy Wood told the panel = -=20 - a position that is toxic to the Bush administration's former opposition t= o=20 price caps. The cost-of-service regime was good enough for 80 years Wood= =20 said. We're trying to move away from it but we can still do it.=20 FERC's action followed by Feinstein's bill withdrawal quickly defused a= =20 mounting political confrontation between the Bush White House and Democrats= =20 over price caps -- one that saw Capitol Hill Republicans beating a retreat.= =20 Democrats argued that Bush by refusing to impose price controls was=20 allowing out-of-state generators based mostly in Texas to gouge California= =20 consumers.=20 The administration especially Vice President Dick Cheney and Energy=20 Secretary Spencer Abraham had insisted that price controls would backfire = by=20 reducing electricity sales and power plant investment making the state's= =20 blackouts worse.=20 Yesterday Sen. Gordon Smith an Oregon Republican who co-sponsored=20 Feinstein's bill as much as said the White House would have lost the fight= .=20 Smith said their measure would have won large majorities in both the Senat= e=20 and House had it gone to a vote.=20 E-mail Carolyn Lochhead at clochhead@sfchronicle.com=20 2001 San Francisco Chronicle ? Page?A - 11=20 Potrero Hill power plant hit by 2 lawsuits=20 Neighbors city ask court to cut back hours of operation=20 Rachel Gordon Chronicle Staff Writer Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/M N238116.DTL=20 The San Francisco city attorney joined forces with environmental and=20 community groups and sued in federal court yesterday to force the operator = of=20 the Potrero Hill power plant to cut its ramped-up electricity output until= =20 more rigorous pollution controls are installed.=20 The plant run by Mirant Corp. increased its output in response to Gov. Gr= ay=20 Davis' move to relax environmental laws on power producers and generate mor= e=20 electricity for Californians.=20 The lawsuits filed against Mirant in U.S. District Court allege the compa= ny=20 is illegally operating its so-called peaker plants. The suits appear to be= =20 the first challenge in California to Davis' efforts to produce more power.= =20 The Potrero Hill plant which runs during times of peak demand has a total= =20 of six turbines that generate 156 megawatts of electricity enough to power= =20 156000 homes. Each turbine is permitted to operate 877 hours a year -- a= =20 threshold that already has been exceeded.=20 Mirant struck a deal March 30 with administrators of the Bay Area Air Quali= ty=20 Management District -- the regional agency that regulates air pollution -- = to=20 run the plants as much as needed to keep up with the energy demand. In=20 return Mirant will pay $20000 per ton of excess emissions of nitrogen=20 oxides a pollutant that causes smog. The company placed $400000 on deposi= t.=20 The Mirant Corporation is behaving like an outlaw and the air district is= =20 their willing accomplice in violating clean air laws said Mike Thomas an= =20 organizer with Communities for a Better Environment one of the plaintiffs.= =20 The other groups that sued are Bayview-Hunters Point Community Advocates an= d=20 Our Children's Earth.=20 The city filed a separate suit over the same issue.=20 The lawsuits ask the court to order Mirant to stop operating beyond the 877= -=20 hour cap until it obtains new permits. The city and environmental groups=20 argue the permits for expanded operation are required by the federal Clean= =20 Air Act.=20 The lawsuits also demand that more stringent pollution controls be installe= d=20 on the peakers. The increased power production poses a potentially serious= =20 health risk to the people who live and work in the surrounding neighborhood= =20 the plaintiffs charge.=20 Because the peaker plants weren't originally intended to run full time the= y=20 aren't equipped with the most up-to-date pollution controls.=20 The plaintiffs also allege the air district regulators violated the=20 California Environmental Quality Act by failing to conduct thorough reviews= =20 of the expanded operation and not allowing for public comment.=20 We as a city are not saying no to power. We're saying there's a process an= d=20 they need to follow it said San Francisco Supervisor Sophie Maxwell who= =20 represents District 10 where the power plant is located.=20 Terry Lee a spokesman for the air district said her agency and Mirant did= =20 nothing illegal. Mirant spokesman Patrick Dorinson concurred.=20 They pointed to Davis' executive orders earlier this year that gave power= =20 companies the right to step up production without going through the normal= =20 permit process and adhering to the stricter pollution controls.=20 William Rostov an attorney for Communities for a Better Environment=20 contends Davis does not have authority to override federal air quality laws= .=20 Lee said the U.S. Environmental Protection Agency signed off on the=20 governor's plan.=20 The plant near 23rd and Illinois streets long has been a target of=20 neighbors trying to close it. Mirant is hoping to build a new 540-megawatt= =20 plant on the site that uses cleaner-burning natural gas. The existing plant= =20 burns highly polluting distillate oil.=20 Lee said the money Mirant is paying for the extra emissions will help reduc= e=20 air pollution in Potrero Hill. The efforts include placing filters on Muni= =20 diesel fuel buses that operate in the neighborhood and installing a lower-= =20 polluting engine on a tug boat that runs off the nearby shores.=20 Is this a perfect situation? No Lee said. But under the governor's=20 executive orders this is the way we're proceeding.=20 E-mail Rachel Gordon at rgordon@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 13=20 Washington wakes up=20 Wednesday June 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/E D40132.DTL=20 WASHINGTON after all does feel our pain. Partial but reasonable price=20 controls will contain wholesale electricity prices beginning today under a= =20 long-sought ruling by the Federal Energy Regulatory Commission. It's about= =20 time.=20 Where was this agency until now and why the sudden willingness to help?=20 Politics.=20 At first the Bush administration denounced controls as market interference= =20 that would chase off investment in power generation.=20 But the peril has spread beyond California to other Western states whose= =20 governors are Republicans. Mid-term elections for Congress are coming up ne= xt=20 year. Also the White House was besieged by California Republicans and=20 business groups worried about blackouts and price gouging.=20 President Bush finally sounded the retreat the day before the commission=20 vote. He could accept a mechanism that would mitigate any severe price= =20 spike. He insisted that the final results were not firm price controls=20 which arguably they are not.=20 Gov. Gray Davis who begged for help for months said the final package=20 didn't go far enough. What he wanted were tougher limits pegged to generati= on=20 costs plus a profit figure of 30 to 50 percent.=20 The final formula approved by the commission amounts to a loose-fit limit= =20 that should dampen the absurd price surges that have endangered the state.= =20 The 24/7 plan rewards modern plants by setting prices based on the=20 least-efficient power producers. It covers 11 states not just sickly=20 California.=20 There is room for doubt. Canny operators may find ways to exploit the prici= ng=20 mechanism. Also California will be whacked with a one-state-only surcharge= =20 of 10 percent. The commission took no action on another Davis complaint tha= t=20 power generators may have overcharged the state by $6.2 billion.=20 Still the new limits may be the most anyone could expect. Consider how far= =20 Washington has come: A hidebound ideology has given way to real-world=20 recognition of a huge problem. U.S. Sen. Dianne Feinstein acknowledged as= =20 much yesterday when she dropped a measure to impose stricter price limits.= =20 California's troubles aren't over. Conservation remains supremely important= .=20 New power plants need approval and speedy construction. The financial damag= e=20 to state utilities and the state's coffers needs attention. The severity of= =20 summer blackouts is a wild card.=20 The federal controls add a measure of protection from this volatile mix. It= 's=20 a shame that help didn't come sooner.=20 2001 San Francisco Chronicle ? Page?A - 18=20 Feinstein halts electricity price caps bill=20 Posted at 12:15 a.m. PDT Wednesday June 20 2001=20 BY JIM PUZZANGHERA=20 Mercury News=20 WASHINGTON -- Like a steam valve on an overheating boiler the move by=20 federal regulators to enact broad new electricity price controls in the Wes= t=20 has relieved much of the growing political pressure for stronger action --= =20 for now.=20 Sen. Dianne Feinstein removed one major source of that pressure Tuesday.=20 Satisfied that the Federal Energy Regulatory Commission has taken ``a giant= =20 step forward'' in curbing California energy prices Feinstein withdrew her= =20 legislation to enact price caps on wholesale electricity prices throughout= =20 the West.=20 ``Let's watch and wait and see how this order works'' the California=20 Democrat told members of the commission during a Senate hearing.=20 But while the battle over the actions of federal regulators may have=20 subsided the larger political war over energy prices continues.=20 California Gov. Gray Davis who has been pounding away for weeks at the Bus= h=20 administration for not providing enough help to the state will step into t= he=20 fray here today. The governor will appear at a Senate hearing where he will= =20 praise federal regulators for moving in the right direction with the new=20 plan. But he's also expected to continue to press for harder price caps and= =20 criticize federal regulators for taking months to act while the state drain= ed=20 billions from its budget to pay for electricity.=20 In addition Davis will question some aspects of the plan such as the lack= =20 of strong action on forcing refunds from suppliers. ``He wants to make sure= =20 that Congress gets the message loud and clear that we want our money back= =20 from the overcharges by generators'' said Davis media representative Steve= =20 Maviglio.=20 But the Republicans are just as eager to lay responsibility for the=20 electricity crisis on Davis who is up for re-election next year. A=20 hard-hitting Republican-backed TV ad campaign in California organized by=20 Scott Reed a former executive director of the Republican National Committe= e=20 blames the governor for failing to act quickly when the crisis first emerge= d.=20 The politics of shifting blame are likely to set the tone for the hearings= =20 organized by the new Democratic chair of the Senate Governmental Affairs=20 Committee Sen. Joe Lieberman D-Conn. Davis and all five FERC commissioner= s=20 have been invited to the hearing to determine if the commission has lived u= p=20 to its legal obligation to ensure ``just and reasonable'' electricity price= s=20 in California.=20 Price controls=20 With that oversight hearing pending this week the commission called a=20 special meeting Monday and took stronger action. It expanded existing=20 electricity price controls around the clock and to 11 Western states. Under= =20 the commission's plan ceiling prices will be set that suppliers can exceed= =20 as long as they provide justification for the higher price. A hard price ca= p=20 would set a price that could not be exceeded.=20 Commission Chairman Curt Hbert a Republican said politics played no role= =20 in enacting the new plan. But Commissioner William Massey one of two=20 Democrats on the five-member commission acknowledged that political pressu= re=20 in recent weeks from Republicans and newly empowered Democrats in the Senat= e=20 had an impact.=20 ``We are an independent agency but we operate in a highly charged political= =20 environment. I would not imply that we did not rule on an independent basis= =20 here but you know this is Washington D.C. for God's sake'' Massey told= =20 the Mercury News on Tuesday. ``I think that it was enlightening to the agen= cy=20 that this wasn't just a Democratic question this was Democrats and=20 Republicans throughout the West saying `My God solve this problem.' And s= o=20 we hope we have.''=20 The White House which had opposed any form of price controls also moved t= o=20 adjust to this political reality.=20 ``To the degree that it is a market-based program this is in keeping with= =20 what the president said and the president is pleased to be able to help=20 California in that manner'' White House press secretary Ari Fleischer said= .=20 ``It does not change the president's fundamental view that a separate=20 economic matter which would be price controls would not be productive.''= =20 But Democrats are eager to point to the shift as evidence that the White=20 House realized it was paying too high a political price for its earlier=20 position insisting that the electricity crisis was largely California's=20 problem to solve.=20 ``The Bush administration is realizing the jig is up. The game is over''= =20 said Sen. Barbara Boxer D-Calif. ``Their attitude of hands-off has hurt th= em=20 deeply.''=20 Democrats in the House have vowed to continue pushing for a vote on their o= wn=20 price-caps bill. The legislation is adamantly opposed by Republican leaders= =20 in Congress who believe FERC's actions Monday are enough government=20 intervention.=20 ``I hope that its actions are based on market principles not political=20 half-measures'' said House Majority Whip Tom DeLay R-Texas. ``It's now ti= me=20 for Governor Davis to stop pointing fingers and shifting blame.''=20 Feinstein has vowed to quickly resurrect her bill if electricity prices sho= ot=20 up dramatically. Boxer said she will introduce legislation to force FERC to= =20 order power suppliers to refund what the state says are billions of dollars= =20 in overcharges for electricity purchases.=20 Meeting on refunds=20 The commission has set up a conference for the state suppliers and utiliti= es=20 to settle the contentious refund issue by July 10. If no settlement can be= =20 reached under the auspices of an administrative law judge the judge will= =20 make a recommendation to the commission and it will resolve the dispute=20 Hbert said.=20 Massey had supported Feinstein's legislation to force him and his fellow=20 commissioners to enact price caps. But after the commission unanimously=20 approved its expanded price-control plan he joined the four other=20 commissioners Tuesday in urging the Senate Energy and Natural Resources=20 Committee not to pass such a law.=20 The commission's chair Hbert strongly warned against legislative action= =20 saying ``I believe in my heart and I know in my educated mind that we ar= e=20 on the right track.''=20 But the issue disappeared Tuesday as Feinstein and the Republican co-sponso= r=20 of the price-cap legislation tabled their plan.=20 ``I think it renders substantially moot the legislative efforts that she an= d=20 I were pursuing'' Sen. Gordon Smith R-Ore. said of the commission's new= =20 price-control plan. ``And I do believe that effort would have won large=20 majorities in the Senate and the House and so I think what you are doing i= s=20 reflecting the will of the elected representatives of the American people.'= '=20 Feinstein said that whatever the commission calls the plan it is close=20 enough to hard caps to merit a chance to work.=20 ``I view this action by FERC as a giant step forward and I'm very grateful = to=20 you'' she told the commissioners. ``I also view the fact that Senator Smit= h=20 and I have worked hard on this bill perhaps has been helpful in urging you= =20 along.''=20 FERC's fixes have fallen short=20 Published Wednesday June 20 2001 in the San Jose Mercury News=20 BY FRANK WOLAK=20 ON Monday for the third time in the past eight months the Federal Energy= =20 Regulatory Commission the agency charged with regulating wholesale=20 electricity prices in California implemented remedies that it claims will= =20 set just and reasonable wholesale electricity prices. This is a case where= =20 the third time is unlikely to be a charm.=20 As chairman of the Market Surveillance Committee of the California=20 Independent System Operator the independent committee formed by FERC to=20 monitor the California market I have analyzed the results of FERC's previo= us=20 attempts. They reveal a misunderstanding of important details of the=20 California electricity market. It is therefore not surprising that they hav= e=20 been ineffective.=20 Starting in November of 2000 FERC acknowledged that wholesale prices in=20 California during the summer of 2000 were unjust and unreasonable. Its=20 December 2000 order implemented the first set of remedies. Both the=20 California Power Exchange Market Monitoring Committee and the committee I= =20 chair pointed out important shortcomings in FERC's analysis of the Californ= ia=20 market and argued that its remedies would most likely harm rather than=20 enhance market performance.=20 At this time FERC also did not order refunds for the unjust and unreasonab= le=20 prices even though it acknowledged the prices reflected the exercise of=20 market power which is the ability of a producer to force prices higher. Th= e=20 Federal Power Act requires refunds under these circumstances. But FERC said= =20 it was unable to find specific instances of firms exercising market power.= =20 This makes no sense. If FERC finds that prices indicate market power then= =20 the generators who bid those prices are exercising market power.=20 Following the implementation of these remedies conditions in the Californi= a=20 market deteriorated far beyond what had been predicted by the two market=20 monitoring committees. Even though January and February are the lowest dema= nd=20 months of the year average wholesale electricity prices were almost 10 tim= es=20 higher in 2001 than they were during the same two months of 2000 and almost= =20 double the average price during the summer of 2000. In January March and= =20 May California experienced several days of rolling blackouts and had syste= m=20 emergencies almost every day during January and February of 2001.=20 IN April FERC made another round of market rule changes designed to lead t= o=20 just and reasonable prices. However in response to growing pressure from= =20 Congress less than 10 days after these remedies were implemented FERC=20 enacted its most recent order.=20 Before Congress declares victory it should verify that FERC's most recent= =20 plan achieves the following two goals.=20 First the plan should guarantee that the average price of wholesale=20 electricity paid by California over the next two years is equal to the=20 average price that would occur in a competitive electricity market with=20 California's current supply and demand conditions and fuel costs. The Feder= al=20 Power Act requires not just a high probability of just and reasonable rates= =20 it requires that they occur with certainty.=20 The second goal is to alter the incentives faced by all market participants= =20 so that it will no longer be profit-maximizing for a firm to withhold=20 electricity from the market in order to drive up prices.=20 FERC's most recently implemented plan does not achieve either of these goal= s=20 although it does come closer than any previous attempts.=20 One solution satisfying both of these goals has been proposed to FERC. In a= =20 December report to FERC the Market Surveillance Committee of the Californi= a=20 ISO proposed a one-time regulatory intervention. This intervention would=20 require that each generator serving California sign a forward contract=20 guaranteeing that California consumers can purchase 75 percent of the=20 generator's expected output over the next two years at a specified=20 competitive benchmark price. Once a firm has signed these forward contracts= =20 it is free to sell all remaining energy in the western U.S. wholesale marke= t=20 at whatever price it can obtain.=20 The obligation to provide power under the contracts and the incentive to= =20 sell 25 percent of power at unrestricted prices would prevent generators= =20 from withholding power.=20 Unless FERC implements a solution satisfying these two goals Congress shou= ld=20 require FERC to suspend the market-based pricing authority for all supplier= s=20 in the Western U.S. for the next two years and order all sales during this= =20 period at cost-of-service prices. This will guarantee that FERC meets the= =20 statutory mandate of the Federal Power Act in California. Frank Wolak is a professor of economics at Stanford University.=20 Wednesday June 20 2001=20 Easing the crunch on costs of power=20 It could have been worse. Yesterday the Federal Energy Regulatory Commissio= n=20 expanded limited price caps on electricity to cover 11 Western states and t= o=20 last 24 hours a day during an emergency.=20 This follows an action in April that imposed caps only in California during= =20 the hours the state declared a power emergency.=20 Under the new rules when reserves are below 7 percent in the California= =20 Independent System Operator spot markets ... the maximum price that can be= =20 charged for spot market sales ... will be 85 percent of the highest hourly= =20 price that was in effect during the most recent Stage 1 [emergency] called = by=20 the ISO the FERC explained yesterday. The order will last until Sept. 30 2001.=20 The action came after intense pressure by Democrats and the Bush=20 administration on the FERC whose three Republican and two Democrat members= =20 all voted for the new controls. It also comes after continuing stories about gouging by suppliers. On=20 Sunday the Register reported how Tulsa-based Williams an energy supplier= =20 manipulated the market to keep prices high.=20 And after Gov. Gray Davis last week attacked Los Angeles' government-run=20 Department of Water and Power for gouging the state on electricity purchase= s=20 reported the Los Angeles Daily News the DWP caved in and agreed to start= =20 selling the state power at 'cost'. The new FERC ruling certainly is better than the demand for across-the-boar= d=20 continuous price controls demanded by Gov. Davis and other Democrats. They're trying to let the market do the best it can under tremendous=20 pressure Robert Michaels a professor of economics at Cal State Fullerton= =20 told us of the FERC members. It's explicitly only for one kind of power= =20 that on short-term so-called spot market kinds of exchanges. Most power is= =20 under other kinds of contracts not touched. The main effect of the new order is that unlike full-blown price controls= =20 it should not discourage the construction of new power generators.=20 [B] POWER UPDATE/ US Senate panel to hold off vote on Calif. cap bill=20 June 20 2001=20 (BridgeNews) June 19 2124 GMT/1724 ET=20 TOP=20 STORIES:=20 US Senate panel to hold off vote on Calif. power cap bill=20 San Francisco June 19 (BridgeNews) - U.S. Senate Energy and Natural=20 Resources Committee Chairman Jeff Bingaman D-N.M. plans to hold off on=20 voting on a bill for U.S. West power price caps following a request by fell= ow=20 senators Dianne Feinstein D-Calif. and Barbara Boxer D-Calif. according= =20 to an aide in Bingaman's office Tuesday. ( Story .20121 )=20 IPE says merger with ICE complete will keep IPE name=20 New York June 19 (BridgeNews) - London's International Petroleum Exchange= =20 has completed its merger with the Intercontinental Exchange an electronic= =20 market for the trading of energy and metals products IPE Chief Executive= =20 Richard Ward said Tuesday. He said the company will still be called the IPE= .=20 His statement follows ICE's announcement Monday that all of conditions of i= ts=20 recommended offer to acquire the issued share capital of IPE Holdings had= =20 been satisfied or waived and that the offer was unconditional. ( Story=20 .17970 .19353 )=20 OF=20 INTEREST:=20 --AMERICAS--=20 FERC order seen having little effect on US generator profits=20 San Francisco June 19 (BridgeNews) - A U.S. Federal Energy Regulatory=20 Commission order to impose a soft price cap on U.S. West wholesale power= =20 prices will likely have little significant effect on producer profits from= =20 electricity sales while the order is in effect over the next year industry= =20 analysts said Tuesday. Some analysts cautioned that some producers without= =20 long-term contracts could be negatively affected by the order. ( Story .203= 40=20 )=20 White House says FERC power plan helpful step for California=20 Washington June 19 (BridgeNews) - The White House Tuesday said action take= n=20 Monday by the federal energy regulators to extend limits on electricity=20 prices in California is and can be a helpful step for the beleaguered=20 state. ( Story .18824 )=20 Calif. ISO rescinds Tues blackout forecast supplies still tight=20 New York June 19 (BridgeNews) - While the California Independent System=20 Operator has rescinded its forecast of possible blackouts for Tuesday the= =20 agency running the Golden State's electricity grid is currently projecting= =20 very little surplus power generated in the state for the day. ( Story .1491= 3=20 )=20 Three states sue DOE over air conditioning standards ruling=20 New York June 19 (BridgeNews) - Attorney generals of California Connectic= ut=20 and New York along with several consumer groups sued the Department of Ener= gy=20 to block a Bush Administration plan allegedly designed to weaken efficiency= =20 standards for residential appliances including air conditioners and heat= =20 pumps. The complaint filed Tuesday in Manhattan federal court calls the=20 administration short sighted and seeks to invalidate its rule changes. (= =20 Story .18548 )=20 NY New England ISOs expand power reserve sharing agreement=20 New York June 19 (BridgeNews) - The Independent System Operators (ISO) for= =20 New York (NYIOS) and New England (ISO-NE) have agreed to expand their=20 reserve-sharing agreement to allow for each ISO to draw on available reserv= es=20 in the other region in the event of a system interruption according to a= =20 statement issued Tuesday by ISO-NE. ( Story .19283 )=20 AGA Preview: US natural gas inventories seen up 85 to 95 bcf=20 New York June 19 (BridgeNews) - The American Gas Association (AGA) is=20 expected to report Wednesday that U.S. natural gas stocks have risen by 85= =20 billion to 95 billion cubic feet (bcf) for the week ended Friday according= =20 to a BridgeNews survey of brokers analysts and traders. The AGA will relea= se=20 the storage report at 1400 ET Wednesday. ( Story .1856 )=20 --ASIA/PACIFIC--=20 GAIL planning 20-bln-rupee gas pipeline in southern India=20 New Delhi June 19 (BridgeNews) - India's state-owned Gas Authority of Indi= a=20 Ltd. plans to lay a new 500-kilometer-long natural gas pipeline connecting= =20 the two southern states of Kerala and Karnataka at a cost of 20 billion=20 rupees the Press Trust of India said Tuesday. The pipeline will carry 6=20 million cubic meters of gas. ( Story .12193 )=20 Indonesia official sees power cuts by 2004 unless new units built=20 Jakarta June 19 (BridgeNews) - Indonesia will face power cuts by 2004 unle= ss=20 additional generating capacity is built Eddie Widiono president director = of=20 state power group PLN said at an industry seminar here on Tuesday. But=20 experts warned that the capital markets were unwilling to finance the=20 billion-dollar investments needed and the public sector could not afford it= .=20 ( Story .12536 )=20 Indonesia to restructure PLN raise power tariff says minister=20 Jakarta June 19 (BridgeNews) - The government aims to revive investment in= =20 Indonesia's power sector with a scheduled 17.5% rise in electricity prices= =20 this year and a later $3 billion debt equity swap to restructure state powe= r=20 company PLN minister of energy and mines Purnomo Yusgiantoro said Tuesday.= =20 PLN will negotiate directly with independent power producers (IPPs) to=20 install additional capacity he added. ( Story .10568 )=20 Indonesian minister claims ExxonMobil to resume Aceh operations soon=20 Jakarta June 19 (AFP) - PT Exxon Mobil Indonesia will resume oil and gas= =20 production in separatist-plagued Aceh province in early July ending a free= ze=20 of more than three months for security reasons a minister said Tuesday. (= =20 Story .10751 )=20 --EUROPE/MIDDLE EAST--=20 Czech's Temelin nuclear plant reactor to be restarted in July=20 Prague June 19 (AFP) - Reactor number one at the controversial Temelin=20 nuclear plant in the Czech Republic will be restarted on July 21 after bein= g=20 shut down for two months for repairs the plant's spokesman announced=20 Tuesday. The reactor was shut down in early May when faults were detected i= n=20 its non-nuclear secondary circuit the latest in a series of technical=20 glitches discovered since it was first put into service in October last yea= r.=20 ( Story .16716 )=20 British Energy: Sizewell B power plant back onstream=20 London June 19 (BridgeNews) - The 1188-megawatt Sizewell B nuclear power= =20 plant has been back onstream for a few days a spokeswoman for operator= =20 British Energy told BridgeNews Tuesday refusing to detail when exactly the= =20 plant was recommissioned and whether its available capacity had since been= =20 utilized by the market. ( Story .12928 )=20 Germany's Mueller says nuclear phase-down formula won't disrupt=20 Berlin June 19 (BridgeNews) - The formula for shutting down German nuclear= =20 power plants should cut atomic generating capacity only one-sixth by 2010= =20 insufficient to raise fears of shortages said Economics Minister Werner=20 Mueller. ( Story .12337 )=20 TURKEY CRISIS: Press: Govt late on IMF pledged power sell-offs=20 Ankara June 19 (BridgeNews) - The Turkish Cabinet has decided to propose t= o=20 the parliament to extend the transfer of operational rights of power plants= =20 to the private sector by another four months once again violating pledges= =20 made to the IMF when securing a U.S. $10 billion bailout package after the= =20 February crisis Sabah newspaper reported Tuesday. The government in its n= ew=20 IMF-supported program pledged to complete transfer of the rights by=20 end-June. ( Story .11978 )=20 se SPOT= =20 NEWS LINKS:=20 THE=20 MARKETS:=20 US FUTURES: UK FUTURES .1908 NY Natural Gas Pre-Opg .1795 IPE Nat Gas Review=20 .1906 NY Natural Gas Review .1794 IPE Nat Gas Midday=20 .1747 NY Natural Gas=20 US/CANADA CASH NATURAL GAS UK/EUROPE CASH NATURAL GAS .1894 Henry Hub natural gas .1807 UK Spot Gas=20 .1884 US/Canada Spot Natural Gas=20 US CASH ELECTRICITY UK/EUROPE CASH ELECTRICITY .8575 California PX: Next day .1892 UK Power Index=20 .8576 .8577 WSCC Forwards (AM/PM) .1889 Nordic Power Market=20 .8585 .8586 PJM Forwards (AM/PM) .1890 Spanish Power Market=20 .8593 .8594 Cinergy Forwards (AM/PM) .1844 UK EFA Power Market=20 .8597 .8598 Entergy Forwards (AM/PM) CANADA CASH ELECTRICITY=20 .8601 .8602 ERCOT Forwards (AM/PM) .5637 Canadian Power Market=20 .8603 New England Forwards=20 .8587 .8600 TVA Forwards (AM/PM)=20 OTHER=20 .1873 US Nuclear Plants Operating Status=20 .2029 BRIDGE CALENDAR: US POWER: Key events to watch=20 .2030 US Utility Deregulation Digest=20 .1704 US Utility M&A Digest=20 SYMBOL=20 LINKS:=20 Click below for adamb chart in Athena NATURAL GAS=20 NYMEX - IPE - NYMEX ELECTRICITY=20 Palo Verde electricity - COB electricity- Cinergy electricity - Entergy electricity - PJM electricity - BridgeNews=20 Send comments to gennews@bridge.com=20 [B] FERC order seen having little effect on US generator profits=20 June 20 2001=20 By Christine Cordner San Francisco June 19 (BridgeNews) - A U.S. Federal Energy Regulatory=20 Commission order to impose a soft price cap on U.S. West wholesale power= =20 prices will likely have little significant effect on producer profits from= =20 electricity sales while the order is in effect over the next year industry= =20 analysts said Tuesday. Some analysts cautioned that some producers without= =20 long-term contracts could be negatively affected by the order.=20 * * * FERC's decision to expand the soft price cap throughout the western grid i= s=20 not very painful for generators Barry Abramson UBS Warburg analyst said= =20 in a research note. The expanded soft price cap will have little impact on= =20 the earnings of the wholesale generating companies. By definition every=20 other power plant is more efficient than the least efficient power plant a= nd=20 thus every other power plant should be able to make a good profit selling a= t=20 the soft price cap.=20 Furthermore on most days most of the power that is produced is sold at= =20 prices below the soft price cap so the soft-price cap has little impact on= =20 the overall earnings of the wholesale generators in the region Abramson= =20 said.=20 FERC on Monday unanimously voted 5-to-0 to expand wholesale price caps to t= he=20 10 western states comprising the Western Systems Coordinating Council. FERC= =20 also expanded the price caps on wholesale power to 24 hours per day seven= =20 days per week from limits only during supply emergencies when reserve=20 margins in California fall below 7%.=20 Under the order wholesale power prices will be limited to 85% of the price= =20 in effect during the final hour of the most recent emergency when Californ= ia=20 is not in a supply emergency. The proxy price will be based on the costs fo= r=20 the least efficient power plant used to generate electricity on that day as= =20 well as the price for natural gas.=20 Generators investor-owned utilities and independent power producers=20 however can receive more than the proxy price if they can justify the high= er=20 generation costs. The plan also allows a 10% surcharge on all wholesale pow= er=20 sales in California in order to account for credit risk.=20 In a research note JP Morgan analysts Jim Von Riesemann and Anatol Feygin= =20 said that earnings for generating companies should remain relatively intac= t=20 and valuations look attractive especially for AES Mirant and NRG.=20 Robert Winters a Bear Stearns analyst said The near-term actions by the= =20 FERC (and the focus on Monday's meeting) the heightened political rhetoric= =20 and the weakening in gas and power prices across much of the U.S. over the= =20 past month has led to the weakness in the shares of the wholesale energy=20 companies...We believe very attractive buying opportunities are being creat= ed=20 within certain areas of the wholesale energy sectors where companies are no= w=20 trading at discounts to their projected earnings growth range.=20 Winters said there were buying opportunities with Williams which continue= s=20 to be our top pick in the wholesale energy space and with Enron Corp.=20 But Abramson noted that the order does not allow producers to mark up the = r=20 price of spot power for resale above the soft price cap which could affec= t=20 some profit margins.=20 The FERC plan should make it challenging for some to repeat the growth of= =20 the last couple of quarters in the West particularly those that without=20 long-term contracts. It appears that the plan would likely dampen volatilit= y=20 although price caps can have unexpected consequences said Merrill Lynch= =20 analyst Steven Fleishman.=20 On a relative basis we believe companies that have locked up much of thei= r=20 capacity under long-term contracts and have efficient baseload power are be= st=20 positioned under the new FERC plan Fleishman said in a note. He said=20 Calpine Dynegy NRG Energy and Williams stand to benefit the most from thi= s=20 scenario.=20 Companies that could be challenged are those with less long-term contracts= =20 that are more dependent on inefficient peaking plants and that could be=20 affected by less volatility in the West Fleishman said. The big question= =20 is how well the marketers positioned their books ahead of this changed=20 environment. He said Reliant Resources since it appears to have the least= =20 contracted in the West for 2002.=20 The plan which will be in effect from Wednesday to Sept. 30 2002 follows= =20 pleas from California Gov. Gray Davis to control wholesale prices which he= =20 said cost the state roughly $50 billion this year.=20 The state's largest utility Pacific Gas & Electric declared bankruptcy=20 earlier this year citing losses from high wholesale prices. End=20 SCE Unveils Rotating Blackout Web Site and Public Notification Plan=20 June 20 2001=20 ROSEMEAD Calif. June 19 /PRNewswire/ via NewsEdge Corporation -=20 Southern California Edison (SCE) today unveiled its enhanced Web site and= =20 public notification process to help guide the public through possible=20 rotating power blackouts when ordered by the California Independent System= =20 Operator (Cal-ISO).=20 We have been able to increase significantly the amount of outage informati= on=20 available to our customers because we want to empower them with critical= =20 information to prepare for and safely cope through power blackouts said P= am=20 Bass SCE's senior vice president of customer service. We recognize that t= he=20 more information customers have before and during rotating outages the=20 better equipped they will be to address the concerns and safety of their=20 families and employees.=20 Bass said customers have indicated they want to know four basic things when= =20 rotating blackouts occur: the location the duration whether it affects=20 them and what they should and should not do to safely get through the=20 outages. SCE offers several information resources that address these concer= ns=20 -- through toll-free phone lines through news media updates and now throu= gh=20 an expanded user-friendly rotating outage Web site.=20 All of these sources will tell customers that the outages rotate among=20 electrical circuits across SCE's vast service area for about one hour as= =20 directed by Cal-ISO. They will also list the likely affected customer group= s=20 and communities and even provide geographic maps outlining the specific=20 neighborhoods. Customers will also be able to access practical tips on how = to=20 prepare and function safely through outages.=20 Customers can find out the group their home or business is assigned to by= =20 identifying their alphanumeric Rotating Outage Group Number which now=20 appears directly under the customer's name and address in the top left corn= er=20 of the bill's front page. When Cal-ISO predicts possible rotating outages= =20 SCE will immediately announce which groups may be affected through its outa= ge=20 hotline -- (800) 611-1911 -- its Web site -- www.sce.com -- and through the= =20 news media.=20 When outages are forecasted or actually begin customers can determine if= =20 their group is part of the current outage or likely to be included in the= =20 next round since SCE generally interrupts groups in numerical order with= =20 some exceptions. For example customers can now hear on the morning news=20 whether Cal-ISO is predicting outages for the day. By calling the hotline o= r=20 checking www.sce.com they can learn which groups would likely be interrupt= ed=20 if circumstances turn out as predicted. If their group number is on the lis= t=20 of groups likely to be interrupted the customer could take steps to prepar= e=20 for the likelihood of rotating blackouts affecting their home or business= =20 that particular day.=20 It should be noted that group numbers may change without advance notice for= =20 operational reasons or when state regulators revise their policy regarding= =20 customers exempted from blackouts. SCE will notify customers of such change= s=20 as quickly as practical.=20 Visitors to SCE's customer Web site www.sce.com will find the following= =20 helpful enhancements:=20 -- The site displays outage group numbers and corresponding communities=20 affected during recent current and predicted rotating outage=20 incidents.=20 -- When customers click on the name of a community affected by an outage= =20 they are taken to a detailed street map of the affected circuit.=20 -- The Web site offers general outage information and links including=20 outage preparation and safety tips grid status information from Cal-=20 ISO frequently asked questions about rotating outages and=20 conservation tips.=20 -- A dynamic home-page pop-up window will change messages depending on=20 state power conditions. For example during a Stage 2 Emergency=20 customers will be directed to information about potential outages.=20 During a Stage 3 Emergency in which rotating outages are underway the=20 box will provide a hotlink to group numbers and communities currently=20 affected and likely to be affected should outages likely continue.=20 For customers who don't have Internet access SCE provides essentially the= =20 same Web site information through an automated outage phone line (800)=20 611-1911. This service makes it possible to obtain outage information=20 immediately without waiting. Among major features:=20 -- Customers can call at any time to learn the Rotating Outage Group=20 Number assigned to their home or business.=20 -- When customers experience a power blackout they can call to determine= =20 whether they are part of a rotating outage incident or if their=20 circuit has been affected by a routine interruption such as a car or=20 construction accident.=20 -- During rotating blackouts customers can learn if their circuit is=20 currently affected or may be affected in the coming hours and which=20 portions of specific communities may be affected.=20 -- When customers call they should have their account number and group=20 number handy. However if customers call during a rotating outage=20 incident and do not know their group number they will be able to=20 obtain information by entering their zip code.=20 SCE's media relations office has developed strategic communications=20 partnerships with radio and television stations that provide frequent live= =20 updates to the public including information about circuit groups affected = or=20 likely to be affected by outages.=20 It should be further noted that while SCE is committed to providing as much= =20 advance public notification about pending rotating blackouts it can only d= o=20 so as it receives timely notification from Cal-ISO.=20 SOURCE Southern California Edison=20 CONTACT: Corporate Communications of Southern California Edison=20 626-302-2255 www.edisonnews.com=20 Web site: http://www.sce.com (EIX)=20 Edison CEO/ Ruling Hasn't Helped=20 June 20 2001=20 By LESLIE GORNSTEIN AP Business Writer LOS ANGELES (AP) via NewsEdge Corporation -=20 A federal ruling this week limiting wholesale energy prices in 10 Western= =20 states hasn't been enough to pull Southern California Edison any further fr= om=20 the brink of bankruptcy Edison International chief John E. Bryson said=20 Tuesday.=20 The state's second-largest utility is no further from or closer to bankrupt= cy=20 now than it was ``two weeks four weeks six weeks ago'' Bryson told a pre= ss=20 conference before a speech to Town Hall Los Angeles a public policy forum.= =20 Bryson is chairman president and chief executive officer of Edison=20 International parent of subsidiary Southern California Edison which serve= s=20 4.2 million customers.=20 Bryson said however that he senses a warming among state legislators to a= =20 proposed bailout deal between his company and the state.=20 That deal would supply billions of dollars to Edison in exchange for years = of=20 cheap power and possibly the utility's power lines.=20 ``Interest has at least intensified in Sacramento on the part of legislator= s=20 to take steps _ debate continues exactly what steps _ to have Edison health= y=20 and to take the state out of the power business and so on'' Bryson said.= =20 Such lawmaker approval is required for the deal to survive. Key lawmakers= =20 surrounding the deal were not immediately available for comment.=20 In his Town Hall address Bryson used the forum as a kind of open plea to= =20 state legislators listing what he called a series of widespread myths that= =20 might be keeping leaders from acting.=20 ``The first myth is that somehow Southern California Edison is seeking a=20 bailout from taxpayers'' Bryson said. ``Only the reverse is true.''=20 Instead Bryson said it was Edison who bailed out California by keeping th= e=20 lights on even when the utility's power costs far exceeded its revenues.=20 Secondly Bryson said Edison and its investors are not profiting from the= =20 power crisis and SoCal Edison's parent did not act improperly by collectin= g=20 money from the utility earlier this year.=20 That money was later given to shareholders a move that outraged consumer= =20 groups.=20 Bryson also warned that a SoCal Edison bankruptcy would severely hurt=20 California's economy by scaring away new businesses and investment capital.= =20 ``Inaction would deeply hurt the state of California and all of us'' he=20 said.=20 Editorial Desk Section A=20 At Last Action on California=20 ?=20 06/20/2001=20 The New York Times=20 Page 22 Column 1=20 c. 2001 New York Times Company=20 After months of dithering the Federal Energy Regulatory Commission took so= me=20 potentially meaningful steps on Monday to contain the wholesale price of=20 electricity in California and elsewhere in the Western United States. Anxio= us=20 not to be seen as caving in to public pressure or abandoning its fidelity t= o=20 the free market the White House described the new policy as ''consistent= =20 with where the president has been all along.'' Gov. Gray Davis of Californi= a=20 for his part said the policy did not go far enough and of course only= =20 time will tell whether it does. But to many others including Senator Diann= e=20 Feinstein of California the move amounted to the first significant federa= l=20 intervention in the California wholesale market since the crisis began last= =20 year. Ms. Feinstein withdrew her own price-cap bill pending the outcome of= =20 the new plan.=20 Under the new arrangement approved unanimously by a reshuffled five-member= =20 Regulatory Commission price limits will be based on the cost of producing= =20 electricity at the least efficient generator. The formula covers the sale o= f=20 electricity for immediate delivery -- the so-called ''spot market'' that=20 supplies about 20 percent of California 's needs and that California turns = to=20 when it is desperately trying to keep the lights on. The companies will be= =20 allowed to charge higher prices during peak periods but not the huge sums= =20 they command today.=20 In addition the constraints will apply throughout 10 other Western states= =20 presumably eliminating any incentive for generators to withhold power from= =20 the California market in order to obtain a higher price elsewhere. The=20 controls are to expire in September of next year which should relieve some= =20 of the administration's earlier fears that constraints of any kind would=20 discourage investment in new and badly needed sources of supply.=20 The benefits will not immediately be felt by California consumers. Both=20 individuals and businesses have recently been hit by rate increases belated= ly=20 imposed by the state's Public Utilities Commission at Mr. Davis's request.= =20 But the new plan should ultimately benefit taxpayers by lessening the impac= t=20 of higher energy costs on the state government which has been buying power= =20 on behalf of the state's two largest utilities both essentially insolvent.= =20 Recent estimates have suggested that California which paid $7 billion for= =20 electricity two years ago could pay as much as $50 billion this year.=20 Until quite recently the president and his energy czar Dick Cheney had=20 seemed almost indifferent to California 's needs. But Republican members of= =20 Congress from California and other Western states have been growing=20 increasingly restive as they contemplate the potential political fallout in= =20 the midterm elections of 2002. In addition the two newest members of the= =20 regulatory commission both Bush appointees have expressed sympathy for=20 California 's plight. Whatever the reason the administration appears to ha= ve=20 seen the light even though it is reluctant to admit it. National Desk Section A=20 Regulators' Order Could Bring Broad California Power Accord By LAURA M. HOLSON with JEFF GERTH ?=20 06/20/2001=20 The New York Times=20 Page 14 Column 3=20 c. 2001 New York Times Company=20 LOS ANGELES June 19 -- An order by federal regulators that power generator= s=20 enter settlement talks with the State of California could open the door to = a=20 sweeping compromise of the financial issues in the state's power crisis=20 energy industry analysts and executives said today.=20 But the question that remains -- and it is a vital one they said -- is=20 whether the Federal Energy Regulatory Commission has the wherewithal to for= ce=20 the warring parties to hammer out an understanding that at its heart is a= s=20 much about politics as about money.=20 The commission on Monday gave California regulators and power generators=20 until July 9 to come up with a plan for settling accounts between the=20 generators and California 's struggling utilities. The power companies are= =20 owed billions but the state has accused them of price-gouging. If the=20 parties cannot reach some agreement an administrative judge will step in a= nd=20 recommend a settlement to the commission instead.=20 Asked at a Senate hearing in Washington today to clarify what he hoped to= =20 accomplish as a result of the two weeks of settlement talks the commission= 's=20 chairman Curtis L. Hebert Jr. was noncommittal. The parties he explained= =20 need two things for the talks to succeed: a deadline and uncertainty.=20 Senator Dianne Feinstein Democrat of California expressed skepticism abo= ut=20 the undertaking. Ms. Feinstein said at the hearing held by the Senate Ener= gy=20 and Natural Resources Committee that she was concerned that the commission= =20 had laid out ''no rules'' for the talks.=20 ''Very little if any money has changed hands as a result of prior=20 settlement conferences'' she said.=20 Many industry executives and state officials have not yet seen the=20 commission's order and they were scrambling today to figure out exactly wh= at=20 they were being asked to do.=20 ''Without seeing what exactly is in the order who knows?'' said Sean=20 Gallagher a staff lawyer for California 's Public Utilities Commission.=20 ''But we wouldn't turn our noses up at participating in negotiations.''=20 Gary Ackerman executive director of the Western Power Trading Forum a=20 coalition of energy traders and electricity generators noted that the=20 federal regulators' timetable ''has a very short fuse.'' And the fact that= =20 the state's biggest utility the Pacific Gas and Electric Company has file= d=20 for bankruptcy will complicate efforts to reach a comprehensive agreement = he=20 added.=20 ''I don't hold high hopes that a settlement would work out'' Mr. Ackerman= =20 said ''but I commend the FERC for taking a stab.''=20 Moreover the parties to the settlement talks may lack an element vital to= =20 successful negotiations: trust.=20 Several California entities including the Public Utilities Commission are= =20 investigating whether generators took advantage of consumers by charging=20 excessive prices for power. The Independent System Operator which runs the= =20 state's power grid released a study in March concluding that Californians= =20 might have been overcharged for electricity by more than $6 billion. One=20 state government negotiator said the California attorney general's office= =20 could file a suit against the power generators in the next few weeks.=20 And as state officials including Gov. Gray Davis continue to hurl attacks= =20 at the generators calling them pirates and profiteers the companies and= =20 California utilities are blaming legislators saying they failed to address= =20 the power crisis quickly enough.=20 In March Duke Energy one of the companies the state has accused of=20 profiteering offered to negotiate a broad settlement but Governor Davis= =20 ruled out calling off the state's inquiries as part of any agreement.=20 The outlines of Duke's proposal included a compromise on the money owed by= =20 California utilities in exchange for the dropping of private lawsuits=20 California 's complaints to federal regulators and the state investigations= .=20 Duke would have admitted no wrongdoing.=20 In formal proceedings the power generators to date have vigorously fought= =20 discounting the debts they are owed by California .=20 The Federal Energy Regulatory Commission has ordered generators to refund= =20 nearly $130 million in what it judged to be overcharges. Today one of the= =20 commissioners William L. Massey said 80 percent of that money had not bee= n=20 collected. A Section=20 Davis Finds Hope in Calif. Power Crunch Rene Sanchez and Peter Behr ?=20 06/20/2001=20 The Washington Post=20 FINAL=20 Page A06=20 Copyright 2001 The Washington Post Co. All Rights Reserved=20 LOS ANGELES June 19 -- Sinking in the polls under attack by a new=20 Republican advertising campaign and still struggling to avert a summer of= =20 blackouts California Gov. Gray Davis (D) nevertheless seems heartened abou= t=20 the latest developments in the power crisis that has engulfed his state and= =20 threatened his political career.=20 On his first trip to Washington in months Davis will detail California 's= =20 plight Wednesday in testimony to a Senate committee newly led by sympatheti= c=20 Democrats -- one important reason for his optimism.=20 But he has others: Conservation is taking hold in the state and prices for= =20 power on the daily spot market are dropping. California has managed to avoi= d=20 rolling blackouts so far this month in part because it has been spared a= =20 heat wave.=20 Federal regulators under pressure even from Republican lawmakers decided= =20 Monday to impose more controls on prices that energy suppliers can charge= =20 California . Two new power plants are scheduled to begin producing=20 electricity in weeks. California also has recently secured more than a doze= n=20 deals for power over the next decade a move Davis contends will stabilize= =20 the volatile wholesale market for energy.=20 In short Davis and his aides say their concerted political strategy and=20 efforts to ease the crisis are beginning to pay off.=20 The bottom line is that we're stabilizing prices and assuring the power wi= ll=20 be there without additional rate increases said Steve Maviglio a spokesm= an=20 for the governor. But he added: We're not ready to say the war is over. It= 's=20 still going to be a tight summer.=20 Whether any or all of those steps will keep the lights on in California thi= s=20 summer or help solve an array of other financial problems the crisis has= =20 caused is hardly clear.=20 In fact California 's power shortfall could produce 113 hours of rotating= =20 outages this summer according to a U.S. Department of Energy study schedul= ed=20 to be released Wednesday.=20 Since California 's two largest utilities fell into financial ruin this yea= r=20 forcing the state to spend nearly $5 billion to buy power directly and=20 saddling residents with huge new rate increases the support that Davis onc= e=20 had from a majority of voters has vanished. Recent polls suggest that he=20 could have trouble winning a second term.=20 Consumer advocates here are besieging him saying that the $43 billion in= =20 long-term power deals that Davis has signed could lock residents into payin= g=20 artificially high utility rates for years. Some contend that all he has=20 gained from Washington is political cover.=20 The Bush administration has created this toothless price cap mechanism tha= t=20 will be used as political protection but certainly not consumer protection= =20 said Doug Heller a director of the Foundation for Taxpayer and Consumer=20 Rights.=20 Davis has stuck mostly to the same political script. He is demanding more= =20 federal help for California -- on Monday he called the Federal Energy=20 Regulatory Commission's decision merely a step in the right direction --= =20 and he is denouncing out-of-state energy suppliers and their Republican=20 allies.=20 Today Republicans launched a $1.5 million advertising offensive that blame= s=20 Davis for the state's energy crunch. The spots running on English and=20 Spanish-language media describe the crisis as Grayouts from Gray Davis.= =20 Scott Reed the GOP strategist who runs the American Taxpayers Alliance=20 which funded the ad campaign said his group wants to counter the governor'= s=20 spin. The blame game has to end said Reed.=20 But Davis's aides say the ads are a sign that Republicans sense California = 's=20 energy predicament could deepen GOP political troubles in the state.=20 Privately some Republican lawmakers pushing for more federal assistance sa= y=20 they are worried that in midterm congressional elections next fall the GOP= =20 could lose House seats in California that it needs to hold a majority.=20 Today's hearing will bring both Davis and his adversaries on the Federal=20 Energy Regulatory Commission before the Senate's Governmental Affairs=20 Committee chaired by Sen. Joseph I. Lieberman (D-Conn.).=20 Instead of a committee debate on California 's electricity prices the focu= s=20 of the session may be shifting toward the billions of dollars of alleged=20 overcharges by energy suppliers.=20 Under growing pressure from both parties in Congress FERC's commissioners= =20 responded Monday with far more extensive price controls than they had been= =20 willing to consider previously. They extended April price controls that had= =20 applied only to times of power emergencies to all hours of the day through= =20 September 2002. And they expanded the controls to cover 10 other western=20 states.=20 California Sens. Dianne Feinstein and Barbara Boxer both Democrats said= =20 FERC's action was a positive step and agreed to delay efforts to direct the= =20 commission to clamp down on California 's energy prices. We're willing to= =20 give them a chance to see if it works Boxer told reporters.=20 Now Davis will press his demands that FERC recover some $8 billion in=20 alleged overcharges by wholesale power suppliers since the crisis began -- = a=20 far larger amount than the $124.5 million in refunds that FERC has so far= =20 assessed.=20 Whether there is even a chance of a peace process is unclear. Just last wee= k=20 California Attorney General Bill Lockyer announced plans to convene a=20 criminal grand jury to investigate whether power generators illegally=20 conspired to drive up electricity and natural gas prices.=20 The governor could face other new problems. Several of California 's major= =20 independent power generators said the price controls and state lawsuits=20 against the generators made it more difficult to justify expanding operatio= ns=20 in California a warning echoed today by Energy Secretary Spencer Abraham.= =20 But heading into the summer California 's power prices are much lower than= =20 they were a month or two ago with daily or spot power prices averaging $= 78=20 per megawatt hour in June compared to $372 in April.=20 Both Davis and the FERC commissioners are taking credit. S. David Freeman= =20 Davis's energy adviser said that the long-term power contracts the state h= as=20 signed the new power plants and favorable weather have tamed prices.=20 FERC Chairman Curt Hebert Jr. said Monday that the limited price restraints= =20 that the commission imposed on wholesale electricity sales in April have be= en=20 a key reason for the price decline.=20 Sanchez reported from Los Angeles and Behr from Washington. Staff writers= =20 Mike Allen and Juliet Eilperin contributed to this report from Washington.= =20 Contact: National Desk Section A=20 The Lesson of When to Give Aid to Free Markets By DAVID E. SANGER ?=20 06/20/2001=20 The New York Times=20 Page 14 Column 3=20 c. 2001 New York Times Company=20 WASHINGTON June 19 -- Three weeks ago George W. Bush addressed a sympathet= ic=20 audience of business executives at the Century Plaza Hotel in Los Angeles a= nd=20 declared that his administration ''will not take any action that makes=20 California 's problems worse and that's why I oppose price caps'' on=20 electricity .=20 As he spoke the Democratic governor of California Gray Davis sat=20 impassively on the dais preparing to meet Mr. Bush and then denounce him f= or=20 failing to protect California consumers from an electricity market gone wil= d.=20 Today the White House halfheartedly welcomed action by federal regulators = to=20 impose throughout the West a system that looks and smells a lot like price= =20 caps -- though the White House said it was something different.=20 ''This is not a price control'' Ari Fleischer the White House spokesman= =20 said. ''This is a market-based mitigation plan that now will extend to 11= =20 Western states.''=20 In fact it bore some resemblance to a proposal made by 10 leading economis= ts=20 who urged a middle ground between fixed prices and a deregulated electricit= y=20 market. Mr. Davis used their proposal to support his position in favor of= =20 limited price restraints when Mr. Bush visited California .=20 The White House shift from outright opposition to price controls to its mor= e=20 nuanced position today exemplifies how Mr. Bush has tempered his embrace of= =20 completely unfettered markets in recent weeks. He didn't have much choice.= =20 As the threat of blackouts loomed demands for action rose from officials o= f=20 both parties and from consumers in the West. It was almost possible to hear= =20 sighs of relief at the White House today that the Federal Energy Regulatory= =20 Commission -- an independent body in the Energy Department -- had moved to= =20 turn down the political heat.=20 In fact while some House Democrats are still pressing for firmer caps on= =20 prices Senators Dianne Feinstein Democrat of California and Gordon H.= =20 Smith Republican of Oregon withdrew a bill that would have placed strict= =20 price controls on electricity sold in Western markets.=20 Senator Feinstein said the White House could call yesterday's regulatory=20 action ''mitigation'' or anything else it pleased.=20 ''A rose is a rose by any other name'' she said today.=20 And a free market is not always free. Two weeks ago the administration said= =20 it would rescue steel companies and steelworkers who have long complained= =20 about unfair competition from South Korea Taiwan China Brazil Germany= =20 Russia and Ukraine. The White House defended the action by saying it was th= e=20 only way for the industry to adjust to a new competitive environment.=20 Last month with no major announcements at the White House the Bush=20 administration voted for International Monetary Fund aid to two countries= =20 Turkey and Argentina that (like California ) had made some economically=20 disastrous political decisions.=20 In each case Mr. Bush's economic orthodoxies were tempered by political=20 realities.=20 The California crisis was one thing when it involved a Democratic governor = in=20 a state Mr. Bush lost by a million votes it was another one of his aides= =20 conceded today when congressional Republicans from around the West were=20 warning Mr. Bush that blackouts and sky-high prices could blow up in his=20 first year in office.=20 ''We heard from a lot of members of Congress who feared that Republicans=20 would be tarred with worsening the problem even though it happened on Gray= =20 Davis's watch'' the political aide said. ''The president took that on=20 board.''=20 Similarly the steel decision was partly about enforcing laws against=20 ''dumping'' foreign products in the market -- and partly about Mr. Bush's= =20 desire to convince labor unions not to block his trade agenda. Like=20 Californians coping with higher energy prices the steelworkers need time t= o=20 adjust to a new world the administration said.=20 ''Open markets improve the lives of people by increasing opportunity choic= e=20 and economic freedom'' Robert B. Zoellick Mr. Bush's trade representative= =20 said in an interview today. ''But compassionate conservatism also recognize= s=20 the reality that the effects of rapid change fall harder on some communitie= s=20 and industries'' which he said need ''vital breathing space to adapt to= =20 change.''=20 While Mr. Bush expressed deep reservations about I.M.F. bailouts during the= =20 presidential campaign the situation seemed a bit more complicated once he= =20 got to Washington. The State and Defense Departments feared that if Turkey= =20 were engulfed in economic chaos and blamed the United States for failing t= o=20 come to its aid its leaders might be less inclined to let American fighter= =20 jets use its territory to mount missions over Iraq.=20 So given the choice between letting the Turkish people pay a high price for= =20 political mistakes -- Californians take note -- and weakening American=20 pressure on Saddam Hussein Mr. Bush decided that economic niceties were le= ss=20 important than political consistency. Mr. Bush chose the Pentagon over the= =20 Treasury.=20 Administration officials said these actions did not represent a retreat fro= m=20 let-the-markets-prevail orthodoxy.=20 Lawrence B. Lindsey Mr. Bush's chief economic adviser said in an intervie= w=20 today that he opposed price caps at the beginning of the California crisis= =20 and that he opposed them now. But he would not criticize the federal=20 commission for ''mitigating'' price spikes in the market.=20 ''What they are trying to do is achieve two incompatible missions --=20 preserving what is called 'just and reasonable pricing' and assuring an=20 adaquate supply of electricity '' Mr. Lindsey said. Yet the reality he=20 added is that new supplies of electricity will not become available for a= =20 year or more. ''FERC is doing its best to square that circle in the face of= =20 the fundamental problem which is inadequate supply'' he said.=20 That is the kind of argument that keeps economists happily arguing for hour= s.=20 It is not likely to be the kind of argument Mr. Bush himself is likely to= =20 engage in for long. As one of his political advisers said the other day=20 ''Don't think about this purely in terms of megawatts. We need to produce= =20 more electricity but we also need to produce some more seats in the=20 House.''=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Meeting Notice - California Document Production Issues Body:: calendar ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Tax Valuations for YR2000 Body:: FYI ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: EGEP Sale Announcement Body:: Please make sure that nothing goes out internally or externally without the approval of Cliff Baxter or Mark Metts. We need to continue our usual vetting process through both PR and IR but need also to add Cliff and Mark. In getting the OK from Cliff and Mark we must have no OKs by default -- ie because we haven't received comments or a response on time. If anybody needs help getting to Cliff or Mark then Mark Palmer Karen Denne or I can help. Thanks What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: NWE Proposed Language to ABX2 82 -- Need to know if we support these --CONFIDENTIAL -- LEGISLATIVE STRATEGY Body:: New West is proposing these amendments to the bad bill AB XX 82. Its view is that it wants to start getting Some interest in the PX credit issue to see if they can get it into a bill. They acknowledge that AB XX 82 is a bad bill. We will be having a teleconf on this tomorrow with all the ESP consolidated billers. So far I've told New West that it would likely be better for them if Enron stays away from formally supporting this given the target on our face in the Legislature. More important I need to know if EES would like to see some PX credit language in legislation. I have some questions about the approach New West took in modifying the legislation so I have a call into them. Sue Mara Enron Corp. Tel: (415) 782-7802 Fax:(415) 782-7854 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Stock Options Body:: Sorry for the delay. I have asked the question and should have an answer in a day or two. . . . don't do anything rash in the meantime. Jane M Tholt@ECT 05/07/2001 12:15 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Stock Options Hi Steve. I know you are extremely busy but I was just wondering if you found out about whether the 3 year period apllies to all options or just the ones in that program. Question 2) does the 3 year time frame apply to only options that are vested at the time of departure or does it apply also to options which vest over the 3 year time frame. I look forward to hearing from you. Thank you. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Senator Feinstein Body:: yes Linda Robertson 03/01/2001 07:47 AM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron cc: Subject: Senator Feinstein Apologized that she could not meet with Steve yesterday. She would like to have this meeting. She asked that we schedule this for your next trip to DC. I think we should do this meeting soon. Do you want me to get on her calendar and then build a day of meetings around her meeting? Or wait until you are otherwise back in town? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: ISO-NE failure to mitigate ICAP market -- Release of ISO NE confidential information Body:: You are forwarding these messages to the wrong Dana Davis. Try Mark Dana Davis Jr. From: Thane Twiggs@ENRON_DEVELOPMENT on 12/13/2000 02:03 PM To: Jeffery Ader/HOU/ECT@ECT Mark Bernstein/HOU/ECT@ECT Scott Healy/HOU/ECT@ECT Janelle Scheuer/HOU/ECT@ECT Tom Dutta/HOU/ECT@ECT Dana Davis/HOU/ECT@ECT Paul J Broderick/HOU/ECT@ECT Chris Dorland/HOU/ECT@ECT Gautam Gupta/HOU/ECT@ECT Michael Brown/NA/Enron@Enron John Llodra/Corp/Enron@ENRON George Wood/Corp/Enron@Enron Joe Gordon/Corp/Enron@Enron Stephen Plauche/Corp/Enron@Enron Jennifer N Stewart/NA/Enron@Enron David Guillaume/NA/Enron@Enron Tom May/Corp/Enron@Enron Robert Stalford/NA/Enron@Enron Jeffrey Miller/NA/Enron@Enron Narsimha Misra/NA/Enron@Enron Joe Quenet/NA/Enron@Enron Paul D Thomas/NA/Enron@Enron Ricardo Perez/NA/Enron@Enron Kevin M Presto/HOU/ECT@ECT Sarah Novosel/Corp/Enron@ENRON Christi L Nicolay/HOU/ECT@ECT cc: Subject: ISO-NE failure to mitigate ICAP market -- Release of ISO NE confidential information The New England Conference of Public Utilities Commissioners (NECUPUC) filed an Answer if Support of the Motion of the Maine Public Utilities Commission for Disclosure of Information. NECUPUC supports the request for the release of the unredacted copies of ISO-NE's September 21 2000 Answer in this case. In the alternative they would ask that the Commission provide to the regulators that are parties to the proceeding unredacted copies of the ISO's September 21 2000 Answer subject to an appropriate protective order. Duke Energy North America (DENA) filed an Answer that opposes the MPUC request for public information. DENA argues that only a three month lag in the release of confidential information is impermissible under a prior FERC ruling in the NSTAR Services Co. case which set out a six-month lag rule for the release of information. Their second argument was that the request seeks information for all NEPOOL markets and not just the ICAP market which is subject to the suit. If the FERC authorizes the release of confidential information then it should be subject to a protective order which contains the following: The information may only be used for the purposes of this docket. Only specifically named reviewing Reps associated with the MPUC may review the information. The confidential materials may not be removed from the NE-ISO's premises. The reviewing rep must execute a nondisclosure certificate. Answer to the MPUC's Motion for Disclosure of Information from Northeast Utilities Service Company and Select Energy and request for expedited commission action. NUSCO and Select Energy Support MPUC's request for disclosure of information that the ISO has filed under seal but opposes the selective disclosure of this information to the MPUC and other regulatory commissions and not other participants. NUSCO and Select Energy request expedited action due the financial implications and there is also considerable uncertainty regarding prices in the residual ICAP market in January February and March of 2000 due to the suspended settlement pending Commission guidance. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Computers Body:: Tell him we are sending his note on to the appropriate person. MARY CLARK 04/03/2001 03:23 PM To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Subject: Computers Steve I need your help in responding to this question. Mary ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Natural Resources and Energy MBA students Body:: Barry Thanks for your message. I am forwarding it with my recommendation to Billy Lemmons who is in charge of our analyst/associate program. Vince What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Catch Up Body:: Joe I could not find the issue. I think I have dumped all the copies of the publication. I am in London next week. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request for Confidential Information by the GAO Body:: We need another request for confidentiality. Please call me. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Computer Based Communications Training Initiative - Response Reminder for Feedback Body:: In my interview I stressed that a big part of the communication problem is the narrow and impermanent nature of the information about what's going on at Enron. Narrow because for every significant activity there are only a few who are in the loop and impermanent because very little information is committed to writing (most of it is exchanged in person or over the phone). This is I believe what lies at the heart of complaints about cross-department communication. We now have some solutions emerging -- software that enables more people to record and post information in HTML format on company intranet sites. I suspect that using such tools will face two obstacles: learning how to use them (ie there's a huge need for training) and making it part of our culture as a knowledge/learning organization Richard Amabile 08/18/2000 05:20 PM To: Mike McConnell/HOU/ECT@ECT Louise Kitchen/HOU/ECT@ECT David Gorte/HOU/ECT@ECT Cindy Olson/Corp/Enron@ENRON James Prentice/GPGFIN/Enron@ENRON Jan Johnson/GPGFIN/Enron@ENRON Mark Koenig/Corp/Enron@ENRON Sharon Butcher/Corp/Enron@ENRON Mary Clark/Corp/Enron@ENRON Gina Taylor/OTS/Enron@Enron Mike Stewart/Corp/Enron@ENRON Dave Schafer/OTS/Enron@ENRON David A Terlip/Corp/Enron@Enron Joe Kishkill/SA/Enron@Enron Marie Hejka/Corp/Enron@ENRON Craig Childers/HOU/EES@EES Craig H Sutter/HOU/EES@EES Kirk Kathleen A John Keith James C Ray Bennett/HOU/EES@EES Joseph W George Wasaff/NA/Enron@Enron Elizabeth Tilney/HOU/EES@EES Michael R Brown/LON/ECT@ECT Andrew S Fastow/HOU/ECT@ECT Billy Lemmons/Corp/Enron@ENRON Steven J Kean/HOU/EES@EES Scott Yeager@ees Eric Thode/Corp/Enron@ENRON Marie Hejka/Corp/Enron@ENRON Cynthia Barrow/HR/Corp/Enron@ENRON John Thompson/LON/ECT@ECT Nigel Sellens/LON/ECT@ECT David Oxley/HOU/ECT@ECT Drew C Lynch/LON/ECT@ECT Marla Barnard/Enron Communications@Enron Communications robert.jones@enron.com Kimberly Rizzi/HOU/ECT@ECT Scott Janie willie.williams@enron.com Scott Tim O'Rourke/Corp/Enron@Enron Miguel Padron/SA/Enron@Enron Gerry Chatham/Corp/Enron@ENRON Cindy Skinner/HOU/ECT@ECT Ranendra cc: ksargent@cognitivearts.com Subject: Computer Based Communications Training Initiative - Response Reminder for Feedback This is a reminder that we would like your feedback/input on the items mentioned below regarding the Computer Based Communications Training Initiative. Please respond by the close of business Monday August 21 otherwise we will need to move ahead with the responses received by that time. Dick Amabile ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Fwd: Portland Consultants Investigation Finds California Has Capacity for Electricity Needs Body:: FYI Content-Transfer-Encoding: quoted-printable Date: Tue 17 Oct 2000 08:53:16 -0500 From: Tracey Bradley To: Deanna King Paul Fox Ronald Carroll Subject: Portland Consultant's Investigation Finds California Has Capacity for Electricity Needs Mime-Version: 1.0 Content-Type: text/plain charset=US-ASCII Content-Disposition: inline FYI - It sounds like this consultant's findings are being questioned by many in the industry including by the CAISO. Portland Ore.-Based Firm Says California Has Capacity for Electricity Needs Dan McSwain North County Times Escondido Calif. ( October 17 2000 ) Oct. 13--PORTLAND Ore.--A private investigation of state power markets has come to the conclusion that California had plenty of electricity generating capacity this summer. The state enjoyed a 32 percent reserve margin even as wholesale prices soared and the state's power manager declared 36 separate power emergencies because California was thought to be in the grips of a critical shortage according to the investigation. The author of the investigation's preliminary report Portland-based economist and utility industry consultant Robert McCullough said at a conference of analysts power traders and electricity industry regulators Thursday that he has found evidence that generators and trading companies manipulated the production of power from June through August to create a false shortage and push up prices. The Encina power plant in Carlsbad provides a stark example: it ran at well below its full capacity for much of June even though wholesale power prices ---- and consumer electricity bills ---- shot to well above the generating plant's cost of production. The actual production of electricity by the plants was determined by an analysis of data from the Environmental Protection Agency which monitors emissions. We are seeing a lot of under-generation McCullough said. This is market power in action. Market power is a term used by economists to describe the ability of market participants -- in this case suppliers -- to influence prices. Many of the industry experts present at the conference Thursday reaffirmed their belief that supply shortages were very real this summer and contributed to high prices but several participants said deregulation has reduced the amount of market information that is available to analysts. Mainstream economists have questioned the accuracy of data from federal agencies including the EPA. Conventional explanations for the low energy production observed in San Diego County are scant. Encina's operators a joint venture of energy giants Dynegy Inc. and NRG Energy Inc. called Cabrillo Power confirmed that the power plant had no abnormal maintenance problems. The San Diego Regional Air Quality Board said Wednesday that the power plant was well within its state-mandated pollution limits. But David Lloyd the corporate secretary of Cabrillo denied that the Encina plant has been used to game the San Diego County power markets. That can't possibly be right Lloyd said of McCullough's analysis. In North County we were right on the ragged edge of being off (an emergency shutdown because of heavy output). Without knowing the specific details of time and which units were on or off I can't comment Lloyd said. We certainly don't want to be accused of anything wrongful he said. We don't have that much power in California and for us to be shutting down in California to push up the price somewhere else doesn't make sense for us. We want to run all we can when the prices are high. Electricity prices have soared to record levels since May resulting in a doubling and tripling of power bills this summer for the 1.2 million customers of San Diego Gas & Electric Co. and causing an estimated $5 billion in losses for Southern California Edison and Pacific Gas & Electric. State lawmakers have intervened on behalf of San Diego County consumers with a retail rate cap but the law in turn created a looming IOU that could grow beyond $300 million if high wholesale prices persist. No fewer than five private state and federal investigations are under way to assess the competitiveness of power markets in the interconnected Western states. The investigations also seek to answer charges that the companies which produce and trade electricity have either figured out how to exploit deregulated markets to outmaneuver regulators or have engaged in outright manipulation in order to increase profits. Inquiries by the California Public Utilities Commission Electricity Oversight Board and attorney general along with a Federal Energy Regulatory Commission investigation were launched in July and August. Staff investigators of the state and federal commissions said this week that they are still in the process of issuing subpoenas and gathering market data. McCullough was hired in late May by the Seattle city utility and a consortium of large industrial power consumers in the Pacific Northwest to investigate the price spikes. His effort is thought to be the first to complete an exhaustive analysis of state and federal information that tracks the amount of electricity that was available and compares it to the amount of power that was actually used. Chief among McCullough's findings was that demand for power was lower this summer than what was forecasted by the Western Systems Coordinating Council a federal agency that is charged with ensuring the stability of the vast web of power transmission lines that connect California to 13 other Western states British Columbia and northern Mexico. McCullough provided a copy of his preliminary findings Tuesday to the North County Times and the initial reaction of the state's energy community was one of deep skepticism. EPA data is notoriously unreliable said Frank Wolak a Stanford professor and the chairman of the market surveillance committee of the California Independent System Operator the agency that manages the state grid and which has paid enormous sums for emergency power this summer. To gauge the actual output of power plants that burn fossil fuel McCullough used emissions data from the EPA. Greed would get the best of anybody Wolak said. I found a lot of hours where in-state generators were exceeding nameplate capacity. These guys were cranking it out. Wolak in a study of power markets for the system operator did conclude however that exercise of market power by power generators and traders was the major cause of higher prices this summer. At the conference in Portland most of the panelists did not openly criticize McCullough's analysis but implicitly disputed his conclusions by attributing higher prices and the presumed exercise of market power to a very real shortage of electricity generating capacity among the Western states. Low hydroelectric production in the Pacific Northwest and high temperatures in the Southwest were blamed for limiting California's ability to import electricity. Others said state and federal regulators along with market participants themselves won't really know what happened until more experts look at hard market information that is in short supply. Ron Eachus the chairman of the Oregon Public Utilities Commission said market information is routinely withheld from regulators the public and buyers of electricity but is shared among power generators and trading companies. If the market is sharing it with themselves but not us I don't buy that Eachus said. Tim Belden is the vice president of West Trading for Enron North America the largest marketer and trader of electricity in the world. Enron takes the unique stand that more information which has been labeled proprietary by companies such as when a plant is being run and how much the electricity is selling for should be made available instantly to the markets. Is there a smoking gun out there or are market participants behaving rationally? Belden said. California is characterized by secret black box market models that nobody understands he said. If you've got nothing to hide release the data. ----- To see more of the North County Times or to subscribe to the newspaper go to http://www.nctimes.com (c) 2000 North County Times Escondido Calif. Distributed by Knight Ridder/Tribune Business News. SRE SCE.Q PCG What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Washington DC Body:: pena - 1:30 Spurling @11:15 and D'Amato @12:00 11:15 D'Amato 12:00 Sperling 1:30 Pena meeting - Tentative 3:30 Janel Guerrero Flying up on company plane. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: TW Gas Sales: PRIVILEGED AND CONFIDENTIAL ATTORNEY CLIENT PRIVILEGE Body:: Julia and Steve--here are some questions I've sent to Darrell on the TW Cal. border line pack sales. I'd like him to pull in the right people to get me the answers so we will be prepared if we need to explain these events. Darrell--I thought I'd better let your bosses know that I've been putting more stuff on your already full plate. Thanks all. DF ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: DRAFT response to Greenpeace Kyoto letter Body:: I think Mike should sign Peter Styles@ECT 04/20/2001 04:57 AM To: Jeffrey Keeler/Corp/Enron@ENRON cc: Michael Terraso/OTS/Enron@ENRON Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON Jackie Gentle/LON/ECT@ECT Kate Bauer/EU/Enron@Enron Paul Hennemeyer/LON/ECT@ECT Doug Wood/LON/ECT@ECT Kelly Kimberly/Enron Communications@Enron Communications@ENRON Catherine McKalip-Thompson/Enron Communications@Enron Communications@ENRON Lauren Iannarone/NY/ECT@ECT Rob Bradley/Corp/Enron@ENRON Mary Schoen/NA/Enron@Enron Stacey Bolton/NA/Enron@Enron Lisa Linda Robertson/NA/Enron@ENRON Nailia Dindarova/LON/ECT@ECT Subject: Re: DRAFT response to Greenpeace Kyoto letter Jeff: Following our conference call yesterday Nailia and I will send you a European Government Affairs mark-up later today. We'll try to incorporate any views expressed by Paul Hennemeyer and Doug Wood too. Jeffrey Keeler@ENRON 19/04/2001 22:00 To: Michael Terraso/OTS/Enron@ENRON Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Mark Palmer/Corp/Enron@ENRON Jackie Gentle/LON/ECT@ECT Kate Bauer/EU/Enron@Enron Paul Hennemeyer/LON/ECT@ECT Doug Wood/LON/ECT@ECT Peter Styles/LON/ECT@ECT Kelly Kimberly/Enron Communications@Enron Communications Catherine McKalip-Thompson/Enron Communications@Enron Communications Lauren Iannarone/NY/ECT@ECT Rob Bradley/Corp/Enron@ENRON cc: Mary Schoen/NA/Enron@Enron Stacey Bolton/NA/Enron@Enron Lisa Jacobson/ENRON@enronXgate Linda Robertson/NA/Enron@ENRON Subject: DRAFT response to Greenpeace Kyoto letter Attached is a first draft of a response to Greenpeace's April 5 letter to Jeff Skilling asking for Enron's answers to some specific questions on the Kyoto Protocol and climate change. Similar letters were delivered by Greenpeace Europe in native languages to Enron's offices in the UK Netherlands Spain and Belgium. I have attached a copy of one of the letters below. All the questions are the same in each. I have drafted a response with the goals of: 1) Being responsive to Greenpeace without being defensive or without greenwashing. We have an already-published public statement on climate change and a very positive solution-oriented story to tell with many facts and accomplishments to back up our statements. I think our letter can land in the stack that they consider positive responses and not in the stack of non-responses or we don't care responses. 2) Steering away from directly answering the no-win questions about Kyoto. I think we can respond to the letter in a way that provides meaningful answers to the general themes of the letter. I have discussed this with many of you already but I strongly feel that we should not get dragged down into debates over what we like/dislike support/oppose about Kyoto....we'll quickly get into questions we can't now answer and may never be able to answer. I'd prefer it if we rise above the politics of the issue and look solution-oriented by saying counties and companies should continue to be engaged in this important issue. 3) Developing corporate-wide messages that we can use in multiple applications -- arming our PR and govt. affairs advocates with a tight script to use in their efforts responding to shareholder inquiries and annual meeting Q&A Ken Lay or other executive speeches and presentations something for our Corporate Responsibility annual report. Sorry for the long preamble but climate change has become a very sensitive issue of late and our message/strategy needs to be very coordinated and we need to have one clear set of statements that everyone in the company can understand and use. With that said I also believe that these messages should be used very carefully as the subject matter is complex and straying too far from the basics can be dangerous. We should designate one or two clear spokespeople that can answer any follow up to the Greenpeace letter by press or policymakers and really stick to the boundaries of what's in our response letter. There is also the issue of customizing responses from the European offices using this letter as a template and adding a few examples of Enron good deeds in the local areas. I am not opposed to doing so but would again appreciate being able to review these responses before they go. Please let me know if you have other views. I would like to send our response by early next week maybe even Monday 4/23 if we can turn it around that fast. Thank you for your input and assistance and I look forward to your reply. Jeff Jeffrey Keeler Director Environmental Strategies Enron Washington DC office - (202) 466-9157 Cell Phone (203) 464-1541 What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Confidential information Body:: Nanette: Changes are made. I'll have the attached document signed and faxed to you tonight. You can fax your executed document back to me at (713) 646-3490. Thanks Leslie Hansen Nanette Crist 11/20/2000 03:38 PM To: 'Leslie.Hansen@enron.com' cc: Subject: RE: Confidential information Leslie--A few nits. Prebon Energy Inc. in the first sentence should not have a comma. Clause (a) in the carve-out as to what constitutes Confidential Information should start that is or becomes... I would put as demonstrable by the receiving party in parens at the end of clause (c). That's it. If you want to have the agreement signed and faxed to me at 201-557-5973 I'll have George sign it tonight or in the morning before the call and send it back to you. Thanks. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Barton Staff Meeting Body:: Yesterday I spent about 45 minutes with the three key energy staff to the H= ouse Energy and Commerce Committee -- Andy Black (for Barton) and Sean Cunn= ingham and Jason Bentley (the energy counsels to the full committee). We m= et at my request to discuss Barton RTO draft. (The group EPSA meeting with= Chairman Barton that was to have been yesterday afternoon has been resched= uled for next Tuesday.) =20 Key points from the meeting -- =20 1. They do not expect the Barton Subcommittee to mark up the electricity l= egislation this year. Time is running out and Members of the subcommittee = are not focused on the issue. Instead they plan to continue working on th= e issue at the staff level. Probably will be another draft version circula= ted and then a version will be introduced by Barton as a formal bill by the= end of the year. The earliest they see any kind of vote is late Jan. or ea= rly February. =20 2. Barton feels strongly that FERC should not be the tail wagging the do= g on RTO policy. =20 3. On particulars of the bill they are clearly reconsidering the 40000 = MW minimum threshold for the size of an RTO. They are getting pulled in bo= th directions they say and are inclined to drop the 40000 MW number -- p= ossibly leaving it to FERC to set a number. They conceded that the mechani= cs of the draft make it unlikely that the 18 month deadline for all trans= mission owners to get into an approved RTO would stick. They consciously c= hanged the normal judicial standard of review for FERC actions from arbitr= ary and capricious to preponderance of the evidence because they think o= therwise the courts will rubber stamp FERC. Spent a lot of time on how the= draft would aid and abet the recalcitrant utilities and that the overall n= ature of the draft assumes there are only two parties to this -- FERC and t= he transmission owners -- while the rest of those truly affected -- from us= to others -- are left out. Sean said we could still intervene but I said= that was the truly pro forma aspect of their process since FERC's hands an= d our's would be tied by the rights given to transmission owners to drag = their feet. =20 Bottom line -- FERC has a window until next Spring without likely congressi= onal interference at least not of the formal legislative variety to both= move on RTOs and improve its relations with Congress. FERC staff has been= pushing the committee staff on concerns similar to our concerns. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: RTO Question Body:: On this same subject of Chairman Wood I am told that he met with Rep. Doug Ose (energy subcommittee chairman of the Government Reform Committee) and Ose's energy advisory board on Wednesday of this week and said similar things. He made a big deal out of a Big Mac analogy -- saying that whether you ordered one in Portland Oregon or Portland Maine the product is the same. With RTOs he supposedly said this meant if the rules are standardized the number of RTOs becomes less important. Those in the room including EPSA staff came away with the impression that Wood is backing away from only 4 RTOs based on this and other comments. Ditto on a 12/15/01 deadline. On the positive side he did say that he had been consulted on the Administration's comments on the Bingaman bill and agreed that legislation without RTO language or bundled/unbundled is OK. He understands the high risk that Congress would go the wrong way on these issues. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: UC-CSU-Enron press release Body:: I know we got a lot of grief on the Hill when we had our fight with UC/CSU. Now we have settled and this release will go out (with some modification) today. ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: External Affairs Meeting in 50M03, conference bridge 853-3233 passcode 3000, you are the host Body:: Reed -- USAir 1062 arr. 10:02 Anthony Duenner -- 6235 Mark Muller Darrel Dunson -- 602-492-8570 Distribution list labels & copying Craig Goodman (Equitible Re 202333-0311(h) What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential - Executive Committee Assistants Body:: Shanna I certainly believe that Jennifer is better than Kim. Jeff is certainly the appropriate judge but she is very young and has a lot yet to learn. This comment is not meant as a cut down at all. John's questionable judgement shouldn't just be trumped however. My thoughts m Shanna Funkhouser@ENRON 01/30/2001 07:44 PM To: Mike McConnell/HOU/ECT@ECT Jeffrey A Shankman/HOU/ECT@ECT cc: Subject: Confidential - Executive Committee Assistants Mike and Jeff I wanted to let you know that Kim Hillis is being promoted from Sr. Admin to Executive Assistant. Cathy Phillips Nicki Daw and Kay Chapman are also Executive Assistants. Please let me know if we need to re-visit a promotion for Jennifer and whether it should be considered now mid year or at a later time. Thanks Shanna What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: <> - March 2001 AMEX Body:: ----------------- What should this email be categorized as? [/INST] Empty message " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: AP Wire services Tues 3/20: Calif. Officials Order Blackouts Dow Jones News Tues 3/20: California Panel to Order Utilities to Make $1= =20 Billion in Back Payments SF Chron 3/20: As Davis Seeks Money Lawmakers Want Answers=20 Members of both parties angry at lack of dialogue Fresno Bee Tues 3/20: Jones rips state on energy crisis Sac Bee Wed. 3/21: Day 2 -- Battling blackouts: Payment plan sought to= =20 restart small plants Sac Bee Wed. 3/21: Hospitals take hit seek power guarantee Sac Bee Wed. 3/21: Lodi still won't pull the plug San Diego Union Tues. 3/20: Blackouts hit for second day break seen=20 Wednesday San Diego Union Tues. 3/20: State power regulators working on energy=20 rescue=20 San Diego Union Tues. 3/20: Federal regulators scored for not ordering= =20 more California refunds LA Times Wed. 3/21: Second Day of Blackouts Disrupts 500000 Home and= =20 Businesses LA Times Wed. 3/21: Fragile Supply Network Apt to Fail LA Times Wed. 3/21: Elevator Anxiety is Riding High LA Times Wed. 3/21: State says it's accelerating plan to buy Power=20 Utilities' Grid LA Times Wed. 3/21: L.A. Long Beach File Suits Over Gas Companies'=20 Prices LA Times Wed. 3/21: Davis OKs Subsidy of Pollution Fees LA Times Wed. 3/21: As Losses Mount Companies work around outages LA Times Wed. 3/21: Commentary: A Blackout on Answers LA Times Wed. 3/21: Commentary: Rolling Blackouts: Blatant Extortion SF Chron Wed. 3/21: Utilities' Demand Blocks Bailout=20 NEGOTIATIONS HIT SNAG: PG&E Edison want end to price freeze if they sell= =20 transmission lines to state SF Chron Wed. 3/21: Utilities' Demand Blocks Bailout=20 BLACKOUTS ROLL ON: Weather increased consumption blamed SF Chron Wed. 3/21: Manners Go Out the Window=20 Pedestrians in peril as drivers turn darkened S.F. streets into free-for-al= l SF Chron Tues. 3/20: Historic Blackouts in State=20 Bay Area learns to cope SF Chron. Tues. 3/20: Second day of rolling blackouts in power-starved= =20 California Mercury News. Wed. 3/21: Bay Area Residents Learning to roll with=20 Blackouts Orange County Wed. 3/21: Powerless Again Orange County Wed. 3/21: The iceman shunneth effects of hourlong blacko= ut Orange County Wed. 3/21: Traffic officials are seeing red over blackout= s Orange County Wed. 3/21: Alternative power producers cut back or shut= =20 down as payments from big utilities lag Orange County Wed. 3/21: O.C. saves its energy -- for blaming others Orange County Wed. 3/21: Blackout readiness on agenda Dow Jones Energy News Wed. 3/21: Calif To Order Utils To Pay Small=20 Generators Up Front-Gov Dow Jones Energy News. Wed. 3/21: PG&E Says It Is Negotiating With=20 Qualifying Facilities Energy Insight Wed. 3/21: New York at the Crossroads --- Calif. Officials Order Blackouts=20 By PAUL CHAVEZ Associated Press Writer=20 LOS ANGELES (AP) - State power managers ordered rolling blackouts across=20 California for a second straight day Tuesday as demand for electricity agai= n=20 exceeded supply.=20 The same factors that collided to strap California's power supply on Monday= =20 hit again officials with the Independent System Operator said. Those inclu= de=20 reduced electricity imports from the Pacific Northwest numerous power plan= ts=20 offline for repairs and higher-than-expected demand because of warm=20 temperatures.=20 A two-unit Southern California plant that the ISO hoped would be working=20 Tuesday had not been fixed. One of its units might go online at noon to hel= p=20 the situation the ISO's Jim Detmers said.=20 In addition hydroelectric power imports from the Northwest were 800=20 megawatts lower than Monday he said. The ISO oversees most of the state's= =20 power grid.=20 --- California Panel to Order Utilities to Make $1 Billion in Back Payments By Jason Leopold 03/20/2001 Dow Jones Business News (Copyright (c) 2001 Dow Jones & Company Inc.) Dow Jones Newswires=20 LOS ANGELES -- The California Public Utilities Commission will order Edison= =20 International's Southern California Edison and PG&E Corp.'s Pacific Gas &= =20 Electric unit to pay small power generators that are qualified utilities=20 about $1 billion in past-due payments in order to keep the plant owners fro= m=20 dragging the utilities into an involuntary bankruptcy proceedings and to= =20 also ensure the generation units keep pumping out electricity people=20 familiar with the matter told Dow Jones Newswires late Monday. Gov. Gray Davis state Sen. Debra Bowen and Assemblymembers Fred Keeley an= d=20 Robert Hertzberg all Democrats spent most of the day y trying to hammer o= ut=20 an agreement with the so-called qualifying facilities alternative power=20 producers that use the wind sun steam and biomass to generate electricity= =20 for the state on supply contracts and past payments the utilities failed t= o=20 make.=20 The qualifying facilities which represent about one-third of the state's= =20 total power supply and signed contracts to sell power directly to the=20 utilities under a government mandate would then agree to sign power-supply= =20 contracts with the utilities for a period of five to 10 years for about $79= a=20 megawatt hour for the first five years and about $61 a megawatt hour=20 thereafter two sources involved in the negotiations said.=20 The PUC is expected to issue a draft resolution on the issue sometime this= =20 week one source said.=20 The lawmakers wouldn't comment on the details of their talks Monday.=20 Representatives with SoCal Ed (EIX) and PG&E (PCG) said they were unaware= =20 Gov. Davis and his administration were meeting on the issue.=20 The utilities are more than $13 billion in debt and have failed to make=20 payments on their qualifying-facilities contracts since November. PG&E has= =20 paid some of its qualified facilities just a fraction of what they are owed= .=20 Legislation To Restructure QF Rates Stalls In Senate Energy Committee=20 Mr. Keeley had recently drafted legislation along with state Sen. Jim=20 Battin a Republican from Palm Desert that would have restructured the rat= es=20 the qualified facilities charge the utilities from $170 a megawatt hour to= =20 $80 a megawatt hour for five years.=20 The bill SB47X stalled in the Senate Energy Committee of which Ms. Bowen= =20 chairs. SoCal Ed opposed the legislation saying the rates were still too= =20 high. A utility spokesman said the qualified-facilities rates should be=20 reduced to under $50 a megawatt hour.=20 But the lawmakers and the governor is trying to avoid the need for=20 legislation largely because there isn't much support in both houses for su= ch=20 a bill and the chance that it won't be passed in time to keep the qualified= =20 facilities from dragging the utilities into involuntary bankruptcy=20 proceedings the legislative source said.=20 The PUC will take over the issue from the Legislature the source said.=20 Monday about 3000 megawatts of qualified-facilities generation went offli= ne=20 because the companies that operate the power plants can no longer afford to= =20 buy natural gas used to fuel the plants due to the utilities' failure to pa= y=20 money owed to the companies said Jim Detmers vice president of operations= =20 for the state's Independent System Operator.=20 The outages triggered a major shortfall in the state which resulted in near= ly=20 eight hours of statewide rolling blackouts Monday.=20 Many owners of the qualified-facilities said without immediate relief they= =20 would likely force SoCal Ed and possibly PG&E into involuntary bankruptcy= =20 perhaps as soon as Thursday.=20 One such facility CalEnergyOperating Co. wants to be freed temporarily fr= om=20 its contract with the utility and be allowed to sell its electricity to thi= rd=20 parties until the utility is able to pay its bills. CalEnergy is an affilia= te=20 of MidAmerican Energy Holdings Co. which is majority owned by Warren=20 Buffet's Berkshire Hathaway Inc. (BRKA).=20 The company sued SoCal Ed last month and the case is scheduled to be heard= =20 Thursday in Imperial County Superior Court. If a judge delivers an=20 unfavorable ruling CalEnergy and other unsecured creditors would drag SoCa= l=20 Ed into involuntary bankruptcy three executives with the companies involve= d=20 said.=20 CalEnergy is said to be organizing a bankruptcy petition now circulating=20 among six of Southern California Edison's independent power suppliers and= =20 could file the petition very quickly if it fails in its suit Thursday said= =20 executives with three of the six companies.=20 Write to Jason Leopold at jason.leopold@dowjones.com=20 Copyright (c) 2001 Dow Jones & Company Inc.=20 All Rights Reserved --- --- As Davis Seeks Money Lawmakers Want Answers=20 Members of both parties angry at lack of dialogue=20 Lynda Gledhill Greg Lucas Chronicle Sacramento Bureau Tuesday March 20 2001=20 2001 San Francisco Chronicle=20 Sacramento -- The Legislature has warned it may block further state purchas= es=20 of electricity as lawmakers' frustration with Gov. Gray Davis' handling of= =20 the energy crisis increases.=20 A test may come soon because Davis asked yesterday for another $500 million= =20 to continue buying power.=20 Sen. Steve Peace D-El Cajon chairman of the Joint Legislative Budget=20 Committee wrote to Davis' Finance Department on Friday that the committee= =20 might deny further spending requests in the absence any discernable=20 progress from the Public Utilities Commission to ensure that the state wou= ld=20 get its money back.=20 Members of the committee both Republican and Democratic said they support= ed=20 Peace's call for more oversight of the spending given the lack of=20 information from Davis on details of the state's power purchases.=20 He's been holding things close to the chest and that bothers me said Se= n.=20 John Vasconcellos D-Santa Clara. I want to know a lot more.=20 Sen. Dick Ackerman R-Fullerton said the administration has been=20 stonewalling us about how much is being spent and how much power we're=20 getting for it. When the state is spending that kind of money at a minimum= =20 legislators should know for what.=20 The state had spent $2.6 billion on electricity through March 11. Davis'=20 request for more money would put the state at the $3 billion mark by the=20 middle of April. The state is spending an average of $49 million a day.=20 The money is supposed to be paid back through the rates collected from=20 utilities' customers. It is up to the PUC to decide how to divide that mone= y=20 among the state the utilities and the utilities' debtors. The commission i= s=20 scheduled to take up the issue at its March 27 meeting.=20 The problem is that there appear to be more demands on the money than there= =20 is money to go around.=20 The utilities have said they need the money to pay off some of their=20 creditors. Among those looking for cash are alternative-power generators th= at=20 were selling electricity to Pacific Gas and Electric Co. and Southern=20 California Edison. Half of them have shut down because they have not been= =20 paid.=20 Earlier this month the PUC granted the Department of Water Resources whic= h=20 has been purchasing electricity for the state the power to recoup its full= =20 costs through rates.=20 It's unclear whether that can be accomplished without raising electricity= =20 prices though Davis has insisted he can solve the crisis without boosting= =20 rates.=20 Lawmakers said they approved the bill that allowed the state to buy power i= n=20 the belief such purchases would be a stopgap until the Davis administration= =20 could sign long-term contracts with power suppliers. However only about 19= =20 contracts have been signed to date out of 42 agreements. If all the=20 contracts are signed they will account for about 70 percent of the power= =20 California is expected to need.=20 It was our expectation some of these contracts would kick in said=20 Assemblywoman Carole Migden D-San Francisco. This was designed to only be= =20 bridge money to avert a power disaster. We should hold firm and come up wit= h=20 a plan.=20 I recall about three weeks ago when we first asked about one of these $500= =20 million letters Migden said. We said maybe this one is necessary but=20 there won't be carte blanche approval of any future requests. I'm pleased= =20 Sen. Peace is taking that approach.=20 To Assemblyman George Runner R-Lancaster Peace's letter was another way= =20 for the Legislature to send a message we need to be in this loop. We're jus= t=20 getting a small little dribble of information which just creates more=20 questions.=20 A spokesman for the Department of Finance said officials hoped to work with= =20 the committee members about their concerns.=20 --- --- Jones rips state on energy crisis=20 Secretary of state hints that he'll take on Davis in 2002.=20 By John Ellis=20 The Fresno Bee (Published March 20 2001)=20 Officially he's Bill Jones secretary of state for California. Unofficiall= y=20 he's Bill Jones 2002 gubernatorial candidate.=20 The evidence is right there between the lines -- in the subtleties of his= =20 speeches their subject matter and the way Jones carries himself when he's= =20 in public.=20 Monday was no different as Jones addressed a Rotary Club luncheon in Fresn= o=20 full of people who are assuming -- though nothing is official -- that the= =20 Fresno native will soon announce his intention to challenge Gov. Davis next= =20 year.=20 Bill they call me governor Chas Looney a former Rotary Club district= =20 governor quipped to Jones. I look forward to the day we all can call you= =20 governor.=20 Jones then proceeded to deliver a speech to a packed house in the DoubleTre= e=20 Hotel that touched on his accomplishments as secretary of state but quickl= y=20 moved to his main topic: California's crumbling infrastructure and how the= =20 energy crisis is affecting the state.=20 Always in the background but never mentioned by name was Davis. Jones was= =20 careful to hew to the Rotary rule that speeches steer clear of partisan=20 politics.=20 Still Jones looked sounded and acted like a candidate for governor and= =20 near the end of his speech he promised his decision would come soon.=20 The Fresno Republican's speech began by highlighting his work in passing th= e=20 Three Strikes and You're Out initiative in 1994.=20 Jones also talked of his efforts to remove 2 million inactive California=20 voters from the rolls.=20 But it was clearly the energy crisis and its ramifications -- an issue=20 Republicans feel they can pin on Davis and the Democratic-controlled=20 Legislature -- that was the centerpiece of the speech.=20 Today the energy crisis is being driven he said by a lack of power plant= =20 construction. And while billions go to solve the crisis he said the state= =20 faces $100 billion in unmet infrastructure needs -- everything from school= =20 repair to road repair.=20 Doesn't that scare you? Jones asked.=20 He then recounted the warning signs -- ignored by the state he said -- of= =20 the looming energy crisis.=20 He cited the initial warnings that the deregulation bill was flawed last= =20 summer's request by Edison and Pacific Gas & Electric to allow forward=20 contracting and the Republican request for a special session to deal with t= he=20 energy crisis. All ignored Jones said.=20 Now Edison and PG&E are near bankruptcy and the state finds itself steppin= g=20 up as a creditor. And the solution now becomes California getting into the= =20 energy business he said. Or even carrying it to a greater degree not= =20 just in the short term to buy power to keep the lights on. I'm talking abou= t=20 basically socializing the energy business.=20 Jones said he prefers low-interest loans to Edison and PG&E taking the=20 electric grid as collateral.=20 I just do not believe in California getting into something it does not kno= w=20 how to do -- has never done before -- on top of all of our other=20 obligations he said.=20 It really worries me that California will not be able to endure that type = of=20 obligation.=20 Jones said polls now show increasing numbers of residents saying the state = is=20 headed in the wrong direction.=20 I feel obligated to speak out and say there is a better way Jones said. --- --- Day 2 -- Battling blackouts: Payment plan sought to restart small plants By Dale Kasler and Carrie Peyton Bee Staff Writers (Published March 21 2001)=20 Blackouts rolled across California for a second straight day Tuesday=20 snarling traffic darkening businesses and sending state officials scrambli= ng=20 to craft a payment plan to revive the wind farms and other critically neede= d=20 small energy producers that have shut down because of financial woes.=20 On a day when another 570000 customers lost power Gov. Gray Davis said th= e=20 Public Utilities Commission and the Legislature would move promptly to orde= r=20 Pacific Gas and Electric Co. and Southern California Edison to start paying= =20 those small energy producers for their electricity. Davis said the two=20 utilities will face considerable fines if they don't pay up.=20 But several of the producers known as qualifying facilities said they= =20 doubted Davis' plan would go far enough to get them back in operation. And = it=20 wasn't clear whether the plan would keep the increasingly impatient=20 alternative producers from hauling one or both of the big utilities into=20 bankruptcy court as some have threatened.=20 The shortage of power from the qualifying facilities -- plus a near-record= =20 heat wave (downtown Sacramento topped off at 83 degrees one degree short o= f=20 the 84 degree record set in 1960) a lack of hydropower and other problems = --=20 prompted the state's Independent System Operator to order a second day of= =20 blackouts starting mid-morning. But the blackouts hit only about half as ma= ny=20 Californians as Monday's with late afternoon conservation efforts helping= =20 balance supply with demand.=20 The blackouts usually about an hour long hit about 7600 Sacramento=20 Municipal Utility District customers in Elk Grove and south Sacramento=20 County. PG&E customers in suburban counties were affected as well.=20 The order darkened shops in San Francisco's Chinatown and was blamed for a= =20 crash that left two motorists seriously injured in the Los Angeles suburb o= f=20 South El Monte. A Sun Microsystems Inc. factory in Newark had to close for= =20 several hours.=20 Most Californians took the blackouts in stride though. Elk Grove High Scho= ol=20 students filed outside to play hacky sack. Coffee shop patrons in Davis=20 milled outdoors enjoying the unseasonably warm weather.=20 Yet the blackout order was met with outright defiance by one municipal=20 utility. The city of Lodi refused to cut power to its residents Monday or= =20 Tuesday saying it shouldn't have to suffer because of the financial crisis= =20 afflicting PG&E and Edison.=20 The outlook for today and the near future was brighter as several big powe= r=20 plants came back on line after repairs. ISO officials also praised=20 Californians' conservation efforts which had faltered in the morning but= =20 came on strong in the afternoon helping to prevent further blackouts. By= =20 evening the grid was in a relatively mild Stage 2 power alert.=20 But the second day of blackouts -- plus an increasing threat of utility=20 bankruptcy -- pushed Davis to the brink. The governor cobbled together a=20 payment plan to rescue the qualifying facilities -- some 600 wind farms=20 geothermal plants and other alternative-energy generators whose production= =20 has become increasingly vital in recent days.=20 Under Davis' plan the Legislature and the PUC would order PG&E and Edison = to=20 pay the qualifying facilities for power delivered after April 1. The=20 utilities are required to buy power from the qualifying facilities under a= =20 1978 federal law designed to bring cheaper and cleaner forms of electricity= =20 to market.=20 Davis said the PUC would release a proposed order late Tuesday that would= =20 require the utilities to pay the qualifying facilities $79 a megawatt hour= =20 for five-year contracts or $69 for 10-year contracts. The Legislature also= =20 would have to pass a law authorizing the PUC to issue such an order.=20 But the situation was far from resolved late Tuesday and PG&E and Edison= =20 were likely to oppose at least portions of Davis' plan.=20 Edison is willing only to make some kind of partial payments going forward= =20 said Thomas Higgins a senior vice president with parent company Edison=20 International. We have a limited amount of resources available to us in=20 rates ... and that's the constraining factor.=20 PG&E which has been making partial payments to the qualifying facilities= =20 said it could pay them in advance in full for future power deliveries.=20 But PG&E said such payments would eat up half the $400 million it has=20 available each month to buy power -- and unless it gets a rate hike there= =20 wouldn't be enough to pay the qualifying facilities and cover other expense= s=20 including the cost of reimbursing the state Department of Water Resources f= or=20 the power the agency is buying on behalf of the troubled utility.=20 PG&E's proposal could represent a challenge of sorts to state officials:=20 Accept less money for the water department or raise rates.=20 State officials need to resolve who they want to see paid PG&E spokesman= =20 John Nelson said. There is a limited pool of money.=20 For his part Davis insisted that the water department would be first in li= ne=20 to be paid and he said the PUC will issue a proposed order to that effect.= =20 We are getting paid before anybody else Davis said.=20 Hundreds of qualifying facilities are out of commission because PG&E and=20 Edison haven't paid them. The situation has robbed the state of several=20 thousand badly needed megawatts and is a key reason blackouts have been=20 ordered. In normal times the facilities produce more than 20 percent of=20 California's electricity.=20 Some of the qualifying facilities have been threatening to haul one or both= =20 of California's beleaguered utilities into bankruptcy court unless they get= =20 paid soon saying a bankruptcy filing might be the only way they can save= =20 their businesses.=20 You've got to take care of the QF problem or the whole thing blacks out= =20 said Jerry Bloom a lawyer representing one group of qualifying facilities.= =20 (State officials) are starting to understand.=20 One thing that was fairly certain about Davis' still-sketchy payment plan: = It=20 wouldn't cover PG&E and Edison's existing debt to the qualifying facilities= =20 estimated at more than $1.48 billion.=20 In their current financial state the utilities say they can't afford to pa= y=20 the existing debt. In addition paying the debt would create a major=20 complication: Other creditors including the big power generators would=20 surely haul Edison and PG&E into bankruptcy court on the grounds that they= =20 weren't being treated fairly.=20 You can't give preferential payment treatment to one class of creditors ov= er=20 another PG&E's Nelson said. You virtually assure that (the other=20 creditors) have to file an involuntary bankruptcy proceeding against you.= =20 But without full payment it wasn't clear how many of the qualifying=20 facilities would be able to restart.=20 Executives at several plants -- the ones that run on natural gas -- said=20 they're not sure their gas suppliers will deliver unless the existing debts= =20 are cleared up.=20 We need to convince a gas company to supply us said Ed Tomeo of UAE Ener= gy=20 Operations Corp. which had to shut off its 40-megawatt Kern County plant= =20 Tuesday. We're a company that already owes millions of dollars for gas=20 supplies. How do you coax them to sell you millions more?=20 It's wishful thinking ... that the gas suppliers are going to sell us gas= =20 Robert Swanson of Ridgewood Power said.=20 I>Bee Capitol Bureau Chief Amy Chance and staff writers Stuart Leavenworth= =20 Bill Lindelof Pamela Martineau and the Associated Press contributed to thi= s=20 report. --- --- Lodi still won't pull the plug By Carrie Peyton Bee Staff Writer=20 (Published March 21 2001) In a growing rebellion against blackouts the city of Lodi has twice refuse= d=20 to cut power to its residents despite an order from Pacific Gas and Electri= c=20 Co.=20 The small city-run electric system is among many disgruntled utilities=20 including the Sacramento Municipal Utility District that believe their=20 contractual pledges to cut back during emergencies were never meant for tim= es=20 like this.=20 It's been a philosophical debate up to this point. Now I guess we've drawn= a=20 line in the sand said Lodi utility director Alan Vallow.=20 PG&E said it is reviewing its interconnection contract the agreement that= =20 links Lodi to the grid through PG&E-owned high-voltage lines to determine= =20 what action it will take next.=20 It's unfortunate that while the city of Lodi has received the benefit of= =20 this agreement for years they are unwilling to bear the burden of this=20 statewide energy shortage said PG&E's Jon Tremayne.=20 One utility coalition the Northern California Power Agency believes that= =20 PG&E has already violated that agreement by not lining up enough power for= =20 customers.=20 The agency wrote PG&E on Friday saying that its members -- municipal=20 utilities and irrigation districts -- believe they aren't required to=20 participate in blackouts prompted by financial disputes.=20 And SMUD which has been considering dropping out of future blackouts will= =20 be watching the response to Lodi said SMUD board President Larry Carr.=20 Some SMUD directors say they're ready to go to court to force the issue. So= =20 is Lodi population 58000 said Vallow.=20 I've heard an Edison executive describe this as a natural disaster akin to= =20 an earthquake. That's crap. This is a man-made event he said.=20 Lodi said it will still help in genuine emergencies such as fires or toppl= ed=20 transmission lines. But it decided that on Monday and Tuesday that wasn't t= he=20 case.=20 You have 3000 megawatts of QFs (qualifying facilities) offline because=20 their bills haven't been paid. Well guess what? Somebody ought to pay thos= e=20 ... bills Vallow said. --- --- Blackouts hit for second day break seen Wednesday=20 By Audrey Cooper ASSOCIATED PRESS=20 March 20 2001=20 SACRAMENTO =01) Rolling blackouts hit California for a second straight day= =20 Tuesday closing souvenir shops in San Francisco's Chinatown snarling=20 traffic and plunging schools and offices around the state into darkness.=20 Roughly a half-million homes and businesses from San Diego to the Oregon=20 border faced outages blamed on the same factors that collided to force=20 blackouts Monday =01) unseasonably warm weather reduced electricity import= s=20 from the Pacific Northwest numerous power plants offline for repairs and= =20 less power provided by cash-strapped alternative-energy plants.=20 Five rounds of outages in San Diego affected about 74000 customers. State= =20 power grid officials expected to have enough electricity to avoid further= =20 outages through at least Wednesday although the supply remained tight.=20 State power regulators working on energy rescue=20 Federal regulators scored for not ordering more California refunds=20 ?=20 Gov. Gray Davis blamed the blackouts in part on the failure of Southern=20 California Edison and Pacific Gas and Electric Co. to pay millions of dolla= rs=20 they owe qualifying facilities power suppliers that use cogeneration =01= )=20 steam from manufacturing plus natural gas =01) or solar wind and other=20 renewable energy to generate electricity.=20 State power grid officials say California this week has lost about half the= =20 electricity QFs normally provide. Several cogeneration plants say they=20 haven't been paid by Edison and PG&E for weeks and can't afford to buy=20 natural gas to fuel their plants.=20 Davis said the utilities are taking in money from customers but still faili= ng=20 to pay the QFs. The state has been spending about $45 million a day since= =20 January to buy power for customers of Edison and PG&E which are so=20 credit-poor that suppliers refuse to sell to them.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators Davis said at a Capitol news conference Tuesday evenin= g.=20 They've acted irresponsibly and immorally and it has to stop.=20 Southern California Edison officials said in a written statement that the= =20 utility is intent on paying creditors and working with the PUC to pay QFs f= or=20 future power sales. PG&E representatives were out of the office late Tuesda= y=20 night and didn't immediately return calls from The Associated Press seeking= =20 comment.=20 John Harrison of the Northwest Power Planning Council a consortium that=20 monitors power use in several Western states said blackouts on the first d= ay=20 of spring are an ominous sign of what lies ahead this summer.=20 We're in trouble he said. We will likely be able to meet our needs this= =20 summer but there won't be much to send to California.=20 Tuesday's outages began at 9:30 a.m. PST and continued in 90-minute waves= =20 until about 2 p.m. when the Independent System Operator lifted its blackou= t=20 order.=20 Grid officials credited an influx of power from the Glen Canyon hydroelectr= ic=20 plant on the Utah-Arizona border.=20 The blackouts were blamed for at least one serious traffic accident.=20 Two cars collided at an intersection without traffic lights in the Los=20 Angeles suburb of South El Monte leaving two people with serious injuries= =20 California Highway Patrol Officer Nick Vite said.=20 Ventura Foods in Industry sent its employees out for an early lunch after= =20 blackouts shut down its phones and computers.=20 This is mild weather for this time of year. I don't know what's going to= =20 happen in the summer manager Frank Hynes said. This is going to have a= =20 serious impact on the state's economy. They can't just keep shutting people= =20 down.=20 Statewide demand was higher than expected because of warm spring weather.= =20 Temperatures reached record highs across California on Monday including th= e=20 80s and low 90s in Southern California. They were expected to be somewhat= =20 lower Tuesday but still in the 70s and 80s.=20 The ISO hoped demand would start to subside and conservation would kick in= =20 but that did not happen Tuesday morning.=20 We have not seen the kind of conservation we saw back in January when th= e=20 first blackouts hit ISO spokesman Patrick Dorinson said. If we don't have= =20 conservation efforts that just means that's more power we have to take off= =20 the grid.=20 In San Francisco's Chinatown souvenir shops normally bustling with visitor= s=20 were forced to shut down. Nearby irritated customers waited for a bank to= =20 reopen.=20 It's no good for anybody =01) stores or businesses or people said Yin Su= n=20 Chan among those in line.=20 PG&E the state's largest utility accounted for most of the customers=20 affected.=20 At least 438000 PG&E residential and business customers were affected as o= f=20 early afternoon spokesman Ron Low said.=20 Edison cut power to about 50000 customers. Edison was ordered to cut less= =20 power than PG&E and saved some due to conservation programs including one= =20 that lets the utility shut off air conditioning for 118500 residential and= =20 business customers when the power supply is tight.=20 About 73400 San Diego Gas & Electric customers were hit by the blackouts.= =20 Los Angeles whose municipal utility is not on the grid that serves most of= =20 California wasn't included in the blackout order.=20 More than 1 million homes and businesses statewide experienced outages=20 Monday.=20 California's power crisis is expected to get even worse this summer when= =20 temperatures soar and residents crank their air conditioning.=20 Natural gas supplies are tight water supplies are down and the state is=20 spending tens of millions of dollars each day to buy electricity for Edison= =20 and PG&E who say they are nearly bankrupt due to high wholesale power cost= s.=20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices the state's 1996 deregulation law=20 prevents them from recouping from ratepayers.=20 Adding to the problems the state this week lost about 3100 megawatts from= =20 QFs. One megawatt is enough power to serve about 750 households.=20 The plants say they are owed about $1 billion for past sales to PG&E and=20 Edison.=20 PG&E said it is offering to prepay the QFs starting next month to get them= =20 back in operation. Negotiations were expected to continue Wednesday.=20 California Co-Generation Council attorney Jerry Bloom said he supports=20 proposals that will get the Qfs paid but the promise of future payments ma= y=20 not be enough.=20 PG&E and Bloom said the utility's prepayments hinge on an upcoming Public= =20 Utilities Commission decision on whether the utility's rates are sufficient= =20 to pay its bills and cover the state's power purchases on its behalf which= =20 amount to $4.2 billion since early January.=20 Davis said the PUC planned to issue a draft order late Tuesday directing th= e=20 utilities to pay their future QF bills.=20 It plans to take action on that order next Tuesday Davis said. The=20 Legislature plans to approve a bill in the meantime giving the PUC the=20 authority to issue such an order and fine the utilities if they fail to=20 comply he said.=20 Davis said he is confident the utilities and the state can pay their bills= =20 without further rate increases for Edison and PG&E customers.=20 --- --- State power regulators working on energy rescue=20 By Karen Gaudette ASSOCIATED PRESS=20 March 20 2001=20 SAN FRANCISCO =01) State power regulators continue to delay the release of= =20 guidelines that will determine a portion of the money the Department of Wat= er=20 Resources can recoup from financially troubled utilities for electricity it= =20 has bought on their customers' behalf.=20 These guidelines will help the water department determine whether it must= =20 raise consumer power rates to reimburse the state for the more than $3=20 billion it has committed to buying electricity.=20 Assemblyman Fred Keeley D-Boulder Creek said Tuesday that the Public=20 Utilities Commission would likely have to raise rates by 15 percent to cove= r=20 the state's costs and the utilities' bills.=20 The PUC guidelines were most recently delayed by a letter from DWR Director= =20 Thomas Hannigan asking that the water department receive a percentage of=20 ratepayer money collected by the utilities equal to the percentage of=20 electricity it provides to utilities.=20 The DWR currently buys around 40 percent of the power used by Pacific Gas a= nd=20 Electric Co. Southern California Edison Co. and San Diego Gas and Electric= .=20 Under the DWR's proposal the utilities would have to hand over 40 percent o= f=20 the money they continue to collect from ratepayers.=20 The DWR would then also receive whatever money remains after the utilities= =20 subtract their own generation and long-term contract costs the letter said= .=20 That amount would become the California Procurement Adjustment =01) an am= ount=20 that will help the state retrieve money spent on power purchases and help= =20 establish the size of state revenue bonds that are currently estimated to= =20 total $10 billion.=20 The state plans to issue the bonds in May to help pay off the more than $3= =20 billion Gov. Gray Davis' administration has committed to power purchases=20 since January to help the utilities climb out of debt.=20 Ron Low a spokesman with PG&E said the utility objects to paying the DWR= =20 such a large sum claiming it would interfere with efforts to pay its=20 qualifying facilities =01) power plants that use the sun wind biomass o= r=20 natural gas to generate about one third of the state's electricity.=20 The nearly bankrupt utilities owe the QFs more than $1 billion for=20 electricity they have produced since November said Jan Smutney-Jones=20 executive director of the Independent Energy Producers.=20 Hannigan also said in the letter the DWR intends to use its authority to=20 raise consumer electricity rates to recoup any money not reimbursed through= =20 the CPA and other means.=20 The Public Utilities Commission expected to release the guidelines last wee= k=20 but was delayed by debates over legislation that would slash the rates of= =20 environmentally friendly power plants under contract to provide electricity= =20 to the investor-owned utilities.=20 Without knowing how much ratepayer money the utilities need to pay these=20 qualifying facilities for future electricity it's unknown how much money= =20 they'll have on hand to pay the DWR.=20 In a written statement PUC Administrative Law Judge Joseph DeUlloa said th= at=20 he would issue a temporary decision on the CPA as soon as is practical.= =20 Pacific Gas and Electric Co. and Southern California Edison Co. say they ha= ve=20 lost more than $13 billion since last June to climbing wholesale electricit= y=20 prices that the state's 1996 deregulation law prevents them from recouping= =20 from ratepayers.=20 --- --- Federal regulators scored for not ordering more California refunds=20 By H. Josef Hebert ASSOCIATED PRESS=20 March 20 2001=20 WASHINGTON =01) House Democrats asked federal energy regulators Tuesday why= they=20 are not going more aggressively after alleged overcharges for wholesale=20 electricity in California and ordering more refunds.=20 The Federal Energy Regulatory Commission has asked suppliers to justify $12= 4=20 million in sales during the first two months of the year or refund the mone= y=20 but critics charge that thousands of additional questionable sales are not= =20 being challenged.=20 The three commissioners testifying at a hearing of the House Commerce=20 subcommittee on energy were asked why they limited their refund demands to= =20 only power sales that occurred during so-called Stage 3 alerts of acute pow= er=20 shortages in California.=20 It appears to me a price is unreasonable when it is unreasonable and not= =20 just during a power alert said Rep. Rick Boucher of Virginia the panels'= =20 ranking Democrat.=20 The commission last week ordered six power generators to justify some 1000= =20 transactions during February in the California market whenever the price wa= s=20 above $430 per megawatt hour and occurred during a Stage 3 emergency alert.= =20 But the lawmakers were told Tuesday that 56 percent of another 14168=20 transactions occurring outside a Stage 3 emergency also exceeded the $430= =20 trigger but are not being questioned.=20 The line was drawn to limit the scope of the refund said agency=20 commissioner William Massey a Democrat who strongly opposed the refund=20 actions because he said they were too limited.=20 Chairman Curtis Hebert a Republican defended the way the commission decid= e=20 on what transactions to challenge saying that it sought to replicate market= =20 conditions as they existed at the time of the sales.=20 We deserve a better explanation retorted Boucher.=20 Massey said that agency's investigation of overcharges for January also=20 failed to consider thousands of transactions that exceeded the refund trigg= er=20 because they did not occur during Stage 3 supply emergencies.=20 Managers of California's electricity grid state regulators and utilities= =20 have accused the agency of refusing to aggressively investigate price gougi= ng=20 by wholesalers who have charged from $150 to $565 per megawatt hour as muc= h=20 as 20 times what prices were in 1999.=20 While Hebert and commissioner Linda Breathitt defended the commissioners=20 attempt to investigate whole electricity prices Massey has been highly=20 critical.=20 What message does the agency's scrutiny of prices send to the power=20 companies? he was asked.=20 It makes clear FERC is going to be looking for the wallet under the lamp= =20 post with the lights shining =01) and nowhere else replied Massey.=20 Meanwhile Massey and his two fellow commissioners also disagreed sharply = on=20 whether the energy agency should impose temporary price controls on the=20 wholesale power market in the West to dampen further expected price increas= es=20 this summer.=20 Massey said he fears a disasters in the making if some price restraints a= re=20 not imposed by FERC which regulates wholesale electricity sales. We need = a=20 temporary time out he said.=20 But Massey is in the minority on the commission. Both Hebert and Breathitt= =20 are against price caps arguing they will have long-term detrimental impact= =20 on power supply.=20 The Bush administration has made its opposition to interfering in the=20 wholesale markets well known for weeks. Vice President Dick Cheney's task= =20 force is to unveil an energy plan in about a month that is expected to lean= =20 heavily on energy production.=20 --- --- Second Day of Blackouts Disrupts 500000 Homes and Businesses=20 Power: Grid operators say the shortage should ease in the next few days bu= t=20 officials see a grim summer.=20 By MITCHELL LANDSBERG and ERIC BAILEY Times Staff Writers=20 A traffic signal that stopped working during Tuesday's rolling blackouts le= d=20 to this collision be tween a car and a truck at an intersection in El Monte= .=20 The outages ran from 9:30 a.m. to 2 p.m. AP ?????Electricity blackouts rolled through California for a second straight= =20 day Tuesday disrupting business in one of the world's most technologically= =20 advanced economies and leaving schoolchildren groping in the dark. ?????Jinxed by a combination of bad luck and bad decisions utilities were= =20 forced to cut off power to more than half a million homes and businesses fr= om=20 San Diego to the Oregon border. ?????By day's end there was some good news from the operators of the=20 statewide power grid who said the situation had eased and appeared likely = to=20 improve for the next few days. And Gov. Gray Davis announced a proposed=20 solution to one vexing problem: the utilities' failure to pay the state's= =20 small alternative power generators many of whom have stopped producing=20 power as a result. ?????Davis called the utilities shameful for failing to pay and praised= =20 the alternative power generators which include solar wind and geothermal= =20 energy producers as good corporate citizens who produced power although= =20 they weren't being paid. ?????We are anxious to pay the [small producers] who are dropping like=20 flies Davis said. ?????Despite the progress it was hard for some people to look on the brigh= t=20 side after enduring outages that took place when the state's hunger for pow= er=20 was almost 50% less than at its summer peak. ?????This is a taste almost like an appetizer of a really unpalatable me= al=20 that's going to be served up this summer said Michael Shames of the Utili= ty=20 Consumers' Action Network in San Diego himself a victim of a rolling=20 blackout that hit his office in San Diego early Tuesday. ?????Power officials have warned that this could be a grim summer in=20 California since demand for electricity sharply rises when people turn on= =20 air conditioners. The state has been struggling to meet its power needs in= =20 recent months because of rising prices and a flawed deregulation plan that= =20 has left the two biggest private utilities on the brink of bankruptcy. Stat= e=20 leaders have so far failed to agree on a comprehensive plan to solve the=20 problems. Wally Quirk teaches a business class in a borrowed classroom Tuesday at=20 Sonoma State after the state's rolling blackouts cut the power to his usual= =20 classroom which does not have any windows. SCOTT MANCHESTER / The Press Democrat ?????The latest round of blackouts began about 9:30 a.m. Tuesday when the= =20 California Independent System Operator which runs the statewide grid=20 determined that the demand for electricity was 500 megawatts more than the= =20 supply--an imbalance that meant the state was short on the power needed to= =20 supply electricity to about 375000 homes. ?????Grid operators blamed a confluence of events including warmer weather= =20 outages at several major power plants including one unit of the San Onofre= =20 nuclear power station a reduction in imports from the Pacific Northwest a= nd=20 the shutdown of many alternative energy producers. Similar blackouts Monday= =20 were the first since January. ?????The situation improved somewhat by late Tuesday morning with some=20 supplies restored and Californians conserving energy and Cal-ISO was able = to=20 halt the rolling blackouts at 2 p.m. ?????Once again customers of the Los Angeles Department of Water and Power= =20 were spared although the municipally owned utility said its electrical=20 surplus was smaller than usual. The DWP like Southern California Edison w= as=20 affected by an outage at the huge Mohave power plant in Nevada as well as = by=20 planned outages at several of its facilities. ?????As in the past by far the biggest impact was felt by customers served= =20 by Pacific Gas & Electric the state's largest utility which cut power to= =20 438000 homes and businesses. ?????Edison cut power to 47462 customers in about 40 cities but eventuall= y=20 was able to avoid blackouts by shutting off the air conditioners of some of= =20 the 118500 customers who participate in a voluntary cutoff program. ?????San Diego Gas & Electric cut power to 73400 customers. ?????Innovative Ways of Coping ?????As on Monday most people took the outages in stride as an annoying b= ut=20 ultimately unavoidable inconvenience. ?????In Palmdale four schools lost power during one of the hourlong=20 blackouts but teachers and students pressed on in the sunlight pouring=20 through windows and skylights. At Barrel Springs Elementary Principal Cruz= =20 Earls said the biggest problem came when students had to go to the bathroom= :=20 Hand in hand they made their way through darkened hallways with flashlight= s. ?????All in all it wasn't a terrible experience. Then again the weather= =20 wasn't that hot Tuesday with a high of 79 in Palmdale so the shutdown of= =20 air conditioners wasn't much of a hardship. I don't want to think about th= e=20 conditions this could create in May or June Earls said. ?????Businesses of all kinds complained about the lack of warning for the= =20 outages--and sometimes found innovative ways to get around the problem. ?????Rattled by news reports of Monday's rolling blackouts El Burrito=20 Mexican Food Products in the city of Industry started its Tuesday shift at = 2=20 a.m. to beat the clock in the event of an outage. That hunch paid off.=20 Workers had just finished cooking and packaging the last batches of salsa a= nd=20 masa when the lights went out at 10:20 a.m. ?????Company owner Mark Roth said the firm will continue working odd hours = to=20 avoid further outages. But he isn't buying the line from the utilities that= =20 they can't provide advance warning because of concerns about looting and=20 rioting. ?????We're ready to do whatever it takes to get through this thing he=20 said. But they've got to give us some notification. ?????At Big O Tires in Elk Grove just south of Sacramento owner Daniel Cr= um=20 had his 14 workers take an early lunch break or head to the warehouse to=20 reorganize the goods. Without electricity they couldn't repair brakes or= =20 align front ends. ?????I'd never let them be idle said Crum. ?????At least two minor traffic accidents were blamed on the outages. ?????The blackouts resulted from a convergence of factors. ?????Demand was slightly higher than expected probably because of=20 unseasonably warm weather. Supplies were tighter than usual in part becaus= e=20 of several outages including that at the Mohave plant half of which was= =20 brought back on line by the end of the day. ?????The San Onofre Nuclear Generating Station was still limping along=20 without power from one of its two 1100-megawatt units which was shut down= =20 Feb. 3 after a half-hour fire in a nonnuclear part of the plant. Edison=20 which operates San Onofre initially estimated the unit would be out for=20 several weeks but recently said extensive damage to parts of the turbine= =20 will keep the unit out of commission until mid-June. ?????Shipments from the drought-stricken Pacific Northwest which generates= =20 most of its electricity from large dams were also down. ?????Each time we take a measurement we're closer to the all-time record= =20 for the driest year said Dulcy Mahar spokeswoman for the Bonneville Powe= r=20 Administration the network of federal dams that provides the region with= =20 much of its electricity. We've been doing what we can but we simply don't= =20 have power to sell. ?????Finally there was the problem of the small and alternative energy=20 producers which have shut down plants because they haven't been paid by th= e=20 private utilities since November. Those outages have cost the state about= =20 3000 megawatts of electricity enough for about 2.3 million homes. ?????You're seeing the system freeze up said David Sokol chairman and C= EO=20 of MidAmerican Energy Holdings Co. which runs eight geothermal plants in t= he=20 Imperial Valley through its subsidiary CalEnergy. His company hasn't shut= =20 down yet but Sokol said smaller companies couldn't continue to sell their= =20 energy to utilities for free. ?????Why should we fund Edison? he asked. That's just ridiculous. ?????A Choice of 2 Rate Plans ?????Davis joined lawmakers in the Capitol on Tuesday to outline his plan t= o=20 get the producers running again. He said utilities have had no right to=20 collect money from ratepayers and then not use the funds to repay the small= =20 producers. The state has spent billions to buy power from large conventiona= l=20 producers on behalf of the utilities but has refused to pick up the tab for= =20 alternative energy. ?????The utilities acted in a shameful manner by putting money in their=20 pockets that was designed to pay the [small producers] Davis said. ?????The plan outlined by Davis would allow the generators to choose betwee= n=20 two rate plans. They could decide to be paid 7.9 cents per kilowatt-hour ov= er=20 five years or 6.9 cents a kilowatt-hour over 10 years. ?????The utilities must begin paying the generators the new rates beginning= =20 April 1 or face fines Davis said. ?????The question of how the companies will get paid the about $1.5 billion= =20 they are owed remains unresolved. That issue will be decided in coming week= s=20 as Davis' negotiators continue to work on rescue plans for the state's=20 financially hobbled private utilities. ?????PG&E spokesman Ron Low said the state's largest utility did not take= =20 kindly to Davis' criticism and noted that the governor's plan is similar t= o=20 a proposal that PG&E made last week to producers. ?????Jan Smutny-Jones executive director of a trade group that includes so= me=20 of the small generators described the plan as a positive step. ?????The governor got it right in that it's not acceptable for small power= =20 producers to continue to generate and not be paid Smutny-Jones said. But= =20 we'll need to see what the order says the devil will truly be in the=20 details. ?????Grid operators said the state's overall energy situation eased by midd= ay=20 Tuesday because of repairs at the Mohave plant and another large plant at= =20 Ormond Beach and because the Western Area Power Administration came up wit= h=20 300 megawatts of electricity from Glen Canyon Dam. ?????Also grid spokesman Patrick Dorinson said conservation savings spiked= =20 upward after earlier complaints that Californians weren't conserving. ?????We saw the people of California probably conserve 900 megawatts today= =20 he said. That was probably the difference. ---=20 ?????Times staff writers Andrew Blankstein Jose Cardenas Marla Dickerson= =20 Noaki Schwartz Nicholas Riccardi Doug Smith Rebecca Trounson and Richard= =20 Winton in Los Angeles Miguel Bustillo and Julie Tamaki in Sacramento Mari= a=20 La Ganga in San Francisco Stanley Allison Matt Ebnet Scott Martelle=20 Dennis McLellan Monte Morin Jason Song Mai Tran and Nancy Wride in Orang= e=20 County and Richard Simon in Washington contributed to this story. --- --- Fragile Supply Network Apt to Fail=20 By JENIFER WARREN and ERIC BAILEY Times Staff Writers=20 ?????A lot of people were caught off guard by the blackouts that swept over= =20 California this week. Debra Bowen wasn't one of them. ?????As chairwoman of the state Senate Energy Committee she is=20 intimately--and painfully--familiar with the state's energy supply. And she= =20 is willing to share a secret: It's a fragile system capable of collapse at= =20 any time. ?????That knowledge keeps Bowen awake at night particularly with the=20 approach of summer when power demand surges as Californians get reacquaint= ed=20 with their air conditioners. ?????I sound a bit less like Chicken Little today don't I? Bowen said=20 Tuesday as chunks of the state once again were forcibly darkened. I know = a=20 lot of people don't feel we have a problem. But we have a very very big=20 problem. ?????With the recent slowdown in Stage 3 emergencies a sense of calm had= =20 settled over the energy debate and even some legislators were speaking wit= h=20 guarded optimism about the hot months ahead. ?????On Tuesday however a creeping sense of doom was almost palpable amon= g=20 energy watchers and previous supply forecasts--which predict that the stat= e=20 may yet escape summer blackouts--were being given a second look. ?????The outages of the last two days are something that Californians are= =20 going to have to get used to for July and August said Michael Zenker=20 California director of Cambridge Energy Research Associates. The=20 Massachusetts consulting firm is predicting about 20 hours of blackouts thi= s=20 summer. ?????At the California Independent System Operator which manages 75% of th= e=20 statewide power grid officials said the energy cushion the state had in=20 recent weeks was in some ways a phantom caused by heavy imports of power. ?????Cal-ISO spokesman Patrick Dorinson said people may have been deluded= =20 into a false state of comfort: Maybe there is a tendency to think things= =20 have improved he said. In fact they haven't. ?????More than anything this week's events illustrate the delicate balance= =20 of factors that keep California illuminated from the multitude of supply= =20 sources to the weather. ?????Temperatures were higher than usual. Alternative-energy suppliers--who= =20 haven't been paid in months by the cash-strapped utilities--cut their outpu= t.=20 Suppliers in the Northwest--which faces a drought--slashed exports. Equipme= nt=20 breakdowns and maintenance at power plants--much of it unanticipated--took= =20 13000 megawatts offline. A utility-run program that gives businesses=20 discounts in exchange for cutting power during emergencies is all but dead. ?????The fragility of the system is such that a small perturbation can tur= n=20 everything upside down very easily said Gary Ackerman executive director= =20 of the Western Power Trading Forum a group of electricity generators and= =20 traders. ?????One factor receiving particular attention is the dip in supply caused = by=20 unscheduled maintenance. To help officials predict available supply=20 generators provide an annual maintenance plan that is updated regularly. ?????In addition however facilities sometimes shut down for unexpected=20 reasons: leaking tubes burnt-out transformers cracked turbines and faulty= =20 feed pumps. At one point Tuesday about 8200 megawatts were unavailable=20 because of unscheduled shutdowns. That's enough to supply about 6 million= =20 households and up from 5700 megawatts a week ago. ?????The huge 1400-megawatt Mohave power plant near Laughlin Nev. which= =20 supplies Southern California Edison and the Los Angeles Department of Water= =20 and Power was felled Monday by a transformer problem. That was enough to= =20 push the state into blackouts. ?????A growing number of skeptics however question whether those reasons= =20 are always valid accusing generators of withholding power to shrink supply= =20 and drive up prices. ?????There's no way to verify it so you've got to take their word for it= =20 said Frank Wolak a Stanford University economist who studies California's= =20 electricity market. And given that it's very profitable for these things t= o=20 occur you start to wonder if they're creating an artificial scarcity. ?????Tom Williams of Duke Energy said the Houston-based company is working= =20 hard to keep its California power plants which are capable of producing=20 3351 megawatts of electricity in operation after months of near-continuou= s=20 operation. ?????It's like riding a moped across the country he said. They're just= =20 not meant to run this hard. ?????Last week the state Senate formed a committee to investigate charges = of=20 market manipulation by power suppliers. The chairman state Sen. Joe Dunn= =20 (D-Santa Ana) says the issue of unscheduled plant shutdowns is on his agen= da. ?????The problem is: How does one prove that a particular outage was part = of=20 a deliberate strategy to deprive the state of kilowatts rather than a resu= lt=20 of normal business operations? Dunn said. ---=20 ?????Times staff writer Nancy Rivera Brooks contributed to this story. --- --- Elevator Anxiety Is Riding High=20 Emergencies: Workers in skyscrapers worry about blackouts trapping them in= =20 their buildings. Some take the risk in stride others make plans to take th= e=20 stairs.=20 By JOHN M. GLIONNA and JOE MOZINGO Times Staff Writers=20 ?????SAN FRANCISCO--In Susan Clifton's highly placed opinion sunny Tuesday= =20 would have been a picture-perfect day to work atop one of the tallest=20 buildings in San Francisco a scenic city littered with soaring skyscrapers= . ?????But Clifton--like many other high-rise office dwellers in blackout-pro= ne=20 parts of California--couldn't help but feel some high anxiety at the prospe= ct=20 of being stranded by electrical outages that were sweeping across the state= =20 for a second day. ?????I think about it all the time said Clifton a 21-year-old=20 receptionist at Deutsche Bank's offices on the 48th floor of a tower in the= =20 city's financial district who recently moved from rural Virginia. The way = I=20 see it Californians take a lot of things on faith working atop tall=20 buildings with all these earthquakes and power outages. ?????For Long Beach office worker Dave Suhada the anxiety has taken the fo= rm=20 of elevator phobia: a fear of getting stuck on an 80-degree day crammed in = a=20 pod of sweating heavy-breathing humans with no way out. ?????I'm just eyeing the buttons to see which one I could push as fast as = I=20 can if the power goes out he said.=20 ?????For 20-year-old Lisa Riley it means entering the elevator each day in= =20 her Long Beach office building with a prayer. I just could not get stuck f= or=20 an hour and a half she said nodding nervously. Often she now opts for th= e=20 stairs. ?????In San Francisco emergency services officials say that most of the=20 city's office buildings are equipped with backup generators to run elevator= s=20 and security equipment in the event of a blackout. ?????Fire Department spokesman Pete House said the city has 19 trucks with= =20 experts trained to extricate people trapped in elevators. Firefighters=20 handling blackout-related emergencies rescued a person trapped in a downtow= n=20 building Tuesday and handled five elevator mishaps Monday. ?????Christopher Stafford didn't get caught inside an elevator Monday but= =20 suffered the next-worst thing: being stranded in his 15th-floor apartment= =20 after the power failed when he went home for lunch. ?????So the 41-year-old real estate worker trooped down the stairs to the= =20 lobby and even made some new friends along the way helping a few elderly= =20 women who were struggling down the stairs. ?????It was a pain he acknowledged. But I have to tell you: I really li= ke=20 my panoramic view so it's worth the hassle. ?????Nowadays Sherrie Tellier makes sure her cellular phone is in hand whe= n=20 she gets in the elevator. She got trapped once before and the emergency=20 phone didn't work. It's amazing she said how small an elevator seems when= =20 you can't get out. It's like a broom closet.Now there's a sigh of relief= =20 every time the door opens. ?????Some high-rise office workers said Tuesday that they preferred not to= =20 think about the perils of going without power and being vulnerable and=20 isolated so high up. ?????But on the 42nd floor of San Francisco's Transamerica Tower Sasha=20 Monpere wasn't fazed by the chance that during a blackout her building's= =20 backup generators wouldn't kick in. ?????Hey I'm young and I'm healthy. I can always walk down the stairs= =20 said the 29-year-old receptionist. I've done the Statue of Liberty. It can= 't=20 be any worse than that. And walking down 42 flights is a lot easier than=20 walking up all those stairs. ?????Likewise with Phil Ip who works on the 52nd--and top--floor of San=20 Francisco's tallest skyscraper. The 25-year restaurant veteran says he has= =20 the utmost faith in modern technology. ?????We're safe even up here said Ip assistant general manager of the= =20 Carnelian Room a restaurant atop the Bank of America building. You should= =20 see the engineer's room in this building. It's like a big steamship. They'r= e=20 equipped for anything that could happen. ?????One floor below Cheryl Martin hears every day about people's fear of= =20 heights. In the year since she began answering phones in a law office she= =20 has often escorted clients afraid of express elevators that shudder and ris= e=20 so fast that passengers' ears pop from the altitude gain. ?????Everybody and I mean everybody asks 'So what happens during a pow= er=20 outage?' she said. ?????Rory Thompson said he believes in karma and is sure that if the rollin= g=20 blackouts come calling his office will be spared. In July 1993 Thompson's= =20 building was the site of an incident known as the 101 California St.=20 massacre in which gunman Gian Luigi Ferri killed eight people and wounded= =20 six before killing himself. ?????This building has already had its bad day he said. They say that t= he=20 day after a crash is the safest day to ride an airline. So I'll take my=20 chances with the rolling blackouts. --- State Says It's Accelerating Plan to Buy Power Utilities' Grid=20 Government: Talks with Edison are reported near completion but agreement= =20 with heavily indebted PG&E has a way to go.=20 By RONE TEMPEST and DAN MORAIN Times Staff Writers=20 ?????SACRAMENTO--As blackouts hit California for a second day Tuesday a ke= y=20 consultant to Gov. Gray Davis said negotiations to buy the power grid owned= =20 by the state's largest utilities are proceeding at an accelerated pace. ?????Wall Street consultant Joseph Fichera said talks with Southern=20 California Edison could be wrapped up within days although those with PG&E= =20 are much less advanced.=20 ?????The administration and PG&E have not reached even an agreement in=20 principle he said. PG&E which has more debt than Edison says its=20 transmission lines are more extensive than those of its Southern California= =20 counterpart. ?????The state wants to buy the utilities' transmission lines and other=20 assets for about $7 billion to provide cash to the utilities help stabiliz= e=20 the electricity supply and ease the power crunch that has plagued Californi= a=20 for months. To research the grid purchase Fichera said the state has had = to=20 pore over 80000 documents just to assess the utilities' liabilities. ?????We are working at a good pace said Fichera chief executive of the= =20 New York firm Saber Partners. . . . If we get to a deal-breaker it might= =20 be longer. ?????By making Fichera who is also a consultant to the Texas Public=20 Utilities Commission available to reporters Tuesday the Davis=20 administration was clearly trying to reassure the public that progress is= =20 being made on the governor's plan to pull the state out of the crisis. ?????Since mid-January when the big utilities' credit failed and suppliers= =20 stopped selling to them the state has spent nearly $3 billion buying=20 electricity from a handful of large suppliers in Texas Oklahoma Georgia a= nd=20 North Carolina. Not a cent has gone to the hundreds of alternative energy= =20 suppliers in California who provide about a quarter of the state's=20 electricity. ?????The Monday and Tuesday blackouts occurred partly because many of the= =20 cash-strapped alternative suppliers including solar biomass and wind powe= r=20 units cut their normal supply to the system in half. They say Edison and= =20 PG&E have not paid them since November the utilities say they are out of= =20 cash. ?????Assemblyman Fred Keeley (D-Boulder Creek) said the plight of the=20 alternative suppliers has dragged on because of the complexity of dealing= =20 with almost 700 individual contractors. ?????Another delaying factor said Keeley who with state Sen. Jim Battin= =20 (R-La Quinta) worked for almost three months to come up with a legislative= =20 plan to lower the small producers' prices was the huge enmity . . .=20 manifested between the utilities and the qualifying facilities. These peopl= e=20 just don't like each other. ?????This week's blackouts provided two painful lessons for the Davis=20 administration: ?????* When it comes to electricity size doesn't matter--every kilowatt=20 counts. During peak use a small wind power facility in Riverside County ca= n=20 make the difference between full power and blackouts. ?????* There is no such thing as a partial solution. Unless the whole energ= y=20 equation is balanced the parts don't work. ?????For the Davis plan to work several key elements need to come together= =20 or utility customers will almost certainly face rate increases above the 19= %=20 already set in motion: ?????* The cost of power purchased by the state must be reduced through=20 long-term contracts with the big out-of-state producers. ?????These contracts the details of which the Davis administration has kep= t=20 confidential are still being negotiated by Davis consultant Vikram Budhraj= a=20 of the Pasadena firm Electric Power Group. The administration says it has= =20 concluded 40 contracts with generators about half of which have been signe= d. ?????According to the most recent statistics released by the Department of= =20 Water Resources which buys power for the state current prices are still= =20 well above the rate state Treasurer Phil Angelides says is necessary for a= =20 planned $10-billion bond offering to succeed. ?????The bonds set for sale in May will be used to reimburse the state fo= r=20 the money it will have spent by that time to buy electricity. The state is= =20 currently spending at a rate of $58 million a day to buy power. If prices= =20 stay high the $10 billion in bonds will not cover the state's power=20 purchases by the end of the summer. ?????Angelides says he cannot proceed with bridge financing for the bonds= =20 until the Public Utilities Commission devises a formula to guarantee that a= =20 portion of utility bills will be dedicated to bond repayment. Angelides has= =20 estimated that under the January law that put the state in the power buyin= g=20 business the state must be reimbursed $2.5 billion annually and that $1.3= =20 billion is needed to service the debt. ?????PUC Administrative Law Judge Joseph R. DeUlloa is expected to announce= =20 his ruling on the reimbursement rate later this week leading to a PUC vote= =20 on the matter as early as next week. ?????* The rates charged for electricity by the alternative producers know= n=20 as qualifying facilities must be cut at least in half down from an averag= e=20 of more than 17 cents per kilowatt-hour. In his news conference Tuesday=20 Davis said he will ask the PUC to set QF rates at 6.9 cents for 10-year=20 contracts and 7.5 cents for five-year contracts. ?????Meanwhile PUC Chairman Loretta Lynch a Davis appointee said Tuesday= =20 that the commission will vote next week on a proposed order requiring=20 Southern California Edison and Pacific Gas & Electric to pay the QFs for=20 electricity in the future. Lynch said a recent PUC assessment showed that t= he=20 utilities have enough cash on hand for that. ?????We are trying to make sure the folks providing the power get paid= =20 Lynch said. The qualified facilities have demonstrated that they haven't= =20 been paid and that it is impairing their ability to provide power. ?????The utilities contend that if they pay the small providers what they o= we=20 them there will not be enough money left to pay other creditors. ?????There is not enough money in the current rate structure to pay the=20 [alternative producers] pay the [Department of Water Resources] and pay th= e=20 utilities for their generation said John Nelson a spokesman for PG&E. ?????* The utilities must sell to the state the power they produce=20 themselves mainly from hydro and nuclear sources at a rate only slightly= =20 above the cost of producing it. This is tied to the ongoing negotiations=20 between the Davis administration and the utilities to restore the=20 near-bankrupt utilities to solvency. ---=20 ?????Times staff writers Julie Tamaki Miguel Bustillo and Tim Reiterman=20 contributed to this report. --- L.A. Long Beach File Suits Over Gas Companies' Prices=20 Energy: Separate actions allege a conspiracy and gouging. Suppliers blame= =20 rising demand and a fluctuating market.=20 By TINA DAUNT and DAN WEIKEL Times Staff Writers=20 ?????Seeking damages that could reach into the billions of dollars the= =20 cities of Los Angeles and Long Beach on Tuesday filed separate lawsuits=20 alleging that a coalition of gas companies illegally conspired to eliminate= =20 competition drive up natural gas prices and discourage the construction of= =20 electricity generating plants in California. ?????Officials from the two cities alleged that Southern California Gas Co.= =20 San Diego Gas & Electric and El Paso Natural Gas Co. violated the state's= =20 antitrust law and engaged in unfair and fraudulent business practices that= =20 caused gas prices to skyrocket. ?????The cities are the first California municipalities to take action=20 against the gas companies. A number of similar lawsuits filed by antitrust= =20 attorneys state regulators and private citizens are pending elsewhere. ?????The energy companies deny any impropriety. They contend that Californi= a=20 is the victim of its own soaring electricity demand and overreliance on=20 fluctuating spot markets for natural gas. ?????The conspiracy theories that have been promoted have no basis in=20 reality said Denise King spokeswoman for Southern California Gas' parent= =20 company Sempra Energy which also was named in the suits. Southern=20 California Gas continues to look out for the best interest of its customers= . ?????The lawsuits filed in Los Angeles County Superior Court accuse the=20 companies of conspiring to manipulate the price of natural gas by agreeing = to=20 kill pipeline projects that would have brought ample supplies of cheaper=20 natural gas to Southern California. ?????They allege that executives for the energy companies made the pact=20 during a meeting in a Phoenix hotel room five years ago to discuss=20 opportunities arising from the state's newly deregulated electricity mark= et. ?????The fulfillment of the illicit plan has had devastating effects on=20 Southern California gas consumers according to Los Angeles' suit. Gas=20 prices in the Southern California market have skyrocketed and the Southern= =20 California gas consumers are paying the highest prices in the nation. ?????In recent months natural gas prices have tripled across the nation fo= r=20 a number of reasons including a shortage of supplies to meet demands for= =20 home heating. Prices have increased far more in California where natural g= as=20 is a central factor in the state's energy crisis. The state relies on the= =20 clean-burning fuel to generate half its electrical power. ?????This not only led to price-gouging of all natural gas consumers from= =20 homeowners to government to industry but it contributed to the current=20 electrical power crisis in California said City Atty. James K. Hahn a=20 mayoral candidate who urged the City Council to pursue the case. ?????Chris Garner Long Beach's utility director said that since November= =20 the average residential bill for gas in Long Beach has more than doubled t= o=20 $175 a month. Some customers he said have seen rate increases of 500%. ?????The people of Long Beach are being gouged by energy conglomerates who= =20 are artificially manipulating the supply of natural gas and reaping excess= =20 profits at the expense of the public said City Attorney Robert Shannon. ?????Holding a special meeting the Los Angeles City Council voted 12 to 0= =20 Tuesday to file the suit. ?????If the allegations are true they are extremely serious said=20 Councilman Mike Feuer who is a candidate to succeed Hahn as city attorney.= =20 And there appears to be some important evidence that substantiates the=20 allegations in the complaint which means that this lawsuit is I think mo= re=20 than a viable lawsuit. ?????Councilman Mark Ridley-Thomas added: We cannot tolerate this and we= =20 must use the full weight of the law to try to correct it. ?????A growing number of lawsuits around the state are targeting California= 's=20 natural gas suppliers. El Paso Corp. which owns the main pipeline=20 transporting out-of-state gas to Southern California has been targeted=20 repeatedly by utility companies state regulators and antitrust attorneys.= =20 ?????Some of the first antitrust lawsuits were filed against Sempra Energy = in=20 December. They were brought by Continental Forge Co. a Compton-based=20 aluminum forging business and Andrew and Andrea Berg who own a business i= n=20 San Diego. ?????The cities' lawsuits request that the defendant companies be barred fr= om=20 such conduct in the future and they seek civil penalties and damages. ?????Shannon estimates that Long Beach could collect more than $100 million= =20 in damages including triple penalties for antitrust violations. ?????We are filing this for our citizens Shannon said. They include the= =20 poor the elderly people living on fixed incomes and small business owners= . ?????The Los Angeles suit was filed on behalf of all Californians. Official= s=20 place damage estimates in the billions.=20 ?????Hahn however warned council members that it could take the city a ye= ar=20 or more to resolve the suit. ?????Lawsuits take time Hahn said. We are hopeful we can enter into=20 meaningful discovery to disclose what's been going on. --- Davis OKs Subsidy of Pollution Fees=20 Smog: As part of secret deal to get long-term energy contracts state would= =20 pay for some of the credits that allow excess power plant emissions. Critic= s=20 renew call for full disclosure.=20 By DAN MORAIN Times Staff Writer=20 ?????SACRAMENTO--As part of his closed-door negotiations to buy electricity= =20 Gov. Gray Davis has agreed to relieve some generators from having to pay=20 potentially millions of dollars in fees for emitting pollutants into the ai= r=20 Davis said Tuesday. ?????Davis announced two weeks ago that his negotiators had reached deals= =20 with 20 generators to supply $43 billion worth of power during the next 10= =20 years. ?????However the Democratic governor has refused to release any of the=20 contracts or detail various terms contending that release of such=20 information would hamper the state's ability to negotiate deals with other= =20 generators and therefore ultimately would raise prices Californians pay for= =20 electricity. ?????Sources familiar with the negotiations speaking on condition of=20 anonymity said the agreement reached with Dynegy Inc. a power company bas= ed=20 in Houston is one that includes language requiring that the state pay the= =20 cost of credits that allow emissions. Dynegy spokesman Steve Stengel declin= ed=20 to discuss the company's deal with the state. ?????We couldn't get them to sign contracts it was a sticking point Dav= is=20 said of the decision to pay the fees of some generators. We had to lock do= wn=20 some power so we were not totally dependent on the spot market. ?????The fees in question are part of an emission trading system known as= =20 RECLAIM. Under the system companies are allotted a certain amount of=20 allowable pollution. If their operations pollute more companies are requir= ed=20 to purchase credits on an open market. Currently the credits cost about $45= =20 per pound of pollution--an amount that can lead to a bill of well over $10= =20 million a year for a power plant. ?????The South Coast Air Quality Management District which regulates=20 pollution in the Los Angeles Basin is considering steps to significantly= =20 lower the cost of the system--a step that could considerably cut the state'= s=20 potential cost Davis said. ?????Senate Energy Committee Chairwoman Debra Bowen (D-Marina del Rey)=20 defended the decision to cover the power company's costs. ?????It is a question of whether it brings down the price of power she= =20 said. If it brings down the price of power I don't have a problem with it= . ?????Nevertheless word that the contracts could bind the state to pay=20 pollution fees caused some critics of Davis' policy to renew calls for Davi= s=20 to reconsider the secrecy surrounding the power negotiations. The payment= =20 provision underscores the fact that the contracts involve more than merely= =20 the prices the state will pay for its megawatts the critics note. ?????The Legislature should have known about it said Senate President Pr= o=20 Tem John Burton (D-San Francisco). It is going to cost taxpayers money. It= =20 makes you wonder. . . . This was a policy issue that was never discussed wi= th=20 the Legislature. ?????V. John White a lobbyist for the Sierra Club who also represents=20 alternative energy producers called the contract proposal a horrible=20 precedent. ?????Until we know exactly what the state has agreed to and how much of a= =20 subsidy this represents we can't determine how serious the breach of=20 principle this is White said. ?????Another critic of the secrecy of the negotiations Terry Francke=20 general counsel for the California First Amendment Coalition said the=20 provision in question raises the possibility that there are other=20 [concessions] that have not yet come to light. ?????In the summer when demand for power is highest some generators=20 probably will exceed pollution limits set by regional air quality managemen= t=20 districts. ?????To avert blackouts state officials might ask the companies to keep=20 plants running. In such cases some sources familiar with aspects of the=20 contracts said the contract language could be interpreted to suggest that= =20 the state would cover any fines--although Davis said Tuesday the state will= =20 not cover the cost of fines. ?????A recent Dynegy filing with the Securities and Exchange Commission=20 underscores the rising cost of pollution-related measures. The company whi= ch=20 is partners with NRG Energy in three California plants in El Segundo Long= =20 Beach and Carlsbad in San Diego County said its aggregate expenditures fo= r=20 compliance with laws related to the regulation of discharge of materials in= to=20 the environment rose to $14.3 million in 2000 from $3.6 million in 1999. ?????A South Coast Air Quality Management spokesman said Dynegy's facilitie= s=20 appear to be fairly clean--although Sierra Club lobbyist White said Dynegy= =20 has been seeking a permit at one of its plants to burn fuel oil which is= =20 dirtier than natural gas. ?????Davis said he intends to make this information public but he added= =20 that we do not want to put the public's interest in jeopardy by asking the= m=20 to pay higher prices. ?????Nobody likes the notion that [the administration is] not being fully= =20 forthcoming Davis said. But I also have a corollary responsibility that = I=20 don't stick these generators with a higher rate. --- As Losses Mount Companies Work Around Outages=20 By MARLA DICKERSONJERRY HIRSCH and NANCY CLEELAND Times Staff Writers=20 ?????As blackouts moved from theory to reality many Southern California=20 businesses spent Day 2 assessing their losses and digging in for what they= =20 expect to be a long hot summer. ?????An hour without electricity may be an inconvenience for most residents= .=20 But for manufacturers and many other businesses even a brief loss of power= =20 can generate tens of thousands in losses. ?????Whether shaping metal or making salsa businesses of all kinds=20 complained Tuesday about the lack of warning of impending outages even as= =20 they sought sometimes creative ways to work around the loss of power. ?????Rattled by news reports of Monday's rolling blackouts Industry-based = El=20 Burrito Mexican Food Products started its Tuesday shift at 2 a.m. Workers h= ad=20 just finished cooking and packaging the last batches of salsa and masa when= =20 the lights went out at 10:20 a.m. ?????We dodged a bullet said El Burrito founder Mark Roth. Losing a day= 's=20 production of salsa would have cost me $15000 to $20000. ?????But other companies weren't so fortunate. ?????Long Beach-based Delco Machine & Gear was still totaling up its losses= =20 from Monday's blackout which amounted to at least $30000 in lost wages an= d=20 production said Nick Campanelli vice president of manufacturing. The=20 company a division of Florida-based B/E Aerospace Inc. makes parts for th= e=20 aerospace industry. The sudden loss of power caused its sophisticated metal= =20 cutting and grinding machines to crash ruining precision parts in producti= on. ?????But the losses don't end there. He said employees will need to spend= =20 hours resetting the equipment. Campanelli is particularly irked that the=20 company received no warning. ?????Five minutes' notice he fumed. That's all I needed. ?????Although businesses such as Campanelli's typically receive no warning= =20 that they are about to lose power insurance companies count the rolling=20 blackouts as planned events a determination that in most cases=20 disqualifies a business from making a claim. ?????I know it must be frustrating for businesses who have the power go of= f=20 suddenly but these outages are planned by the grid operators said Pete= =20 Moraga of the Insurance Information Network of California. That means it= =20 would not be a covered peril in a traditional business insurance policy. ?????Typically business insurance covers loss of profit and damage from=20 unforeseen events such as fires or windstorms. The component of the policy= =20 that covers interruptions in business kicks in after a given amount of time= =20 elapses usually 24 to 48 hours. ?????Business polices can be written to include unusual coverages Moraga= =20 said but he has never heard of a policy that covers losses from a rolling= =20 blackout. ?????Some companies are taking measures not to get caught in a situation=20 where a blackout can hurt them. ?????The region's largest steel supplier shut down for two hours Monday aft= er=20 Southern California Edison called to warn of tight supplies. ?????We just can't take a chance said Lourenco Goncalvez president of= =20 California Steel Industries Inc. in San Bernardino County. We have a lot o= f=20 safety issues. People could get hurt. ?????Goncalvez said the plant has multiple 20-ton and 25-ton overhead crane= s=20 that operate with electromagnetic devices which would fail if they lost=20 power suddenly. Falling materials could injure workers below he said. We= =20 have been asking to be exempt from rolling blackouts he said. ?????Goncalvez said he couldn't put a price on the lost production at the= =20 24-hour plant and said he worried more about the long term. ?????Two hours is nothing he said. My concern is this thing will start = to=20 happen almost every day. If it will be like this all summer you can be sur= e=20 it will have dramatic consequences for the entire economy. . . . We're goin= g=20 to have a shortage of steel products in California. Maybe the government do= es=20 not consider this is serious. We'll see. ?????At Sport Chalet a La Canada Flintridge-based chain of 22 sporting goo= ds=20 stores in Southern California an administrative assistant monitors the sta= te=20 power situation hoping to warn any stores that are in danger of losing=20 power said Craig Levra the company's chief executive. ?????Levra said the assistant was assigned the monitoring duties last year= =20 when rolling blackouts were still only a threat. ?????The chain put in place an emergency plan--similar to what it would do = in=20 a major earthquake. Backup power will kick on emergency lights and allow th= e=20 cash registers to complete transactions. Employees are instructed to escort= =20 customers from the building safely Levra said. ?????Other businesses however have plans to remain open during the 60- to= =20 90-minute blackouts. ?????When power went out at two Cheesecake Factory restaurants in Orange=20 County on Monday afternoon the eateries switched to serving cold dishes su= ch=20 as sandwiches and salads said Howard Gordon senior vice president of the= =20 Calabasas Hills-based chain. ?????The restaurants had enough backup power to operate emergency lights an= d=20 cash registers. Large windows provided the rest of the light Gordon said. ?????So far the 99 Cents Only Stores chain has missed the shotgun pattern = of=20 the blackouts. But with nearly 100 stores in California company President= =20 Eric Schiffer believes it is only a matter of time before the lights go out= =20 at one of its outlets. ?????Though the stores have some backup power the chain has systems in pla= ce=20 to operate without it. Its cash registers can open mechanically Schiffer= =20 said. Because an item sells for a multiple of 99 cents sales clerks are=20 equipped with blackout sheets that calculate a customer's tab including= =20 tax. All the clerk has to do is count the number of items in the shopping= =20 cart and check the tables on the sheet. ?????This week's power crunch has been exacerbated by the fact that so-call= ed=20 interruptible electricity customers no longer face large penalties if they= =20 decline to shut down their operations when supplies get critically low. ?????The Public Utilities Commission suspended the fines in January to ease= =20 the burden on about 1400 businesses that found themselves bearing the brun= t=20 of the crisis to prevent rolling blackouts in the rest of the state. ?????According to Edison about 10% of its interruptible customers are=20 complying with requests to curtail electricity usage during crunch time. Bu= t=20 Scott Keller isn't among them. ?????The owner of Chino-based STC Plastics Inc. said he was forced to shut= =20 down more than 20 times since September costing him as much as $10000 in= =20 lost production per day. He ignored requests Monday and Tuesday to curtail= =20 usage and said he doesn't feel a twinge of remorse. ?????If I'm shut down I can't pay my workers he said. I'd feel more=20 guilty about that. ?????But this is one area where insurance eventually might help. Moraga sai= d=20 some carriers are developing plans that would cover penalties for continuin= g=20 to use power after they have been asked by a utility to cut back. --- Wednesday March 21 2001=20 A Blackout on Answers=20 Davis needs to do a better job in communicating to Californians about the= =20 electricity crisis. In the absence of that cynicism grows.=20 ?????The oil shocks of the 1970s from the Arab oil embargo to the Iran-Ira= q=20 war were dead simple compared with the California power shortage. Then th= e=20 problem was a lack of imported oil and the chief symptom was long lines and= =20 high prices at gas stations. Politicians urged conservation: Turn down the= =20 heat drive fewer miles buy more efficient cars. People understood the cau= se=20 of the crisis and the benefit of their actions. Today it's a different stor= y=20 and a damnably complicated one that gives consumers no place--or actually= =20 too many places--to focus their anger.=20 ?????The last two days of rolling blackouts including previously exempt=20 Southern California have not reduced power demand or at least not enough.= =20 Consumers are suspicious: Are out-of-state power companies holding back=20 production? Did utilities really not have enough money to pay alternative= =20 energy producers--the little guys who combined could produce enough power= =20 to prevent the blackouts? And what happened to long-term power contracts t= he=20 state-bargained deal that was supposed to stabilize the crisis?=20 ?????The frustrations are vast and there are too many gaps in the story. I= f=20 it's just a pack of thieves creating an artificial shortage as even some= =20 consumer organizations charge why should anyone sacrifice to conserve? Tha= t=20 in a nutshell is the problem that Gov. Gray Davis the state Legislature a= nd=20 the Public Utilities Commission face.=20 ?????Davis for one has to level with the public and stop acting as if he= =20 can fix the crisis. He has proved he can't at least not without reductions= =20 in usage and most likely rate increases. If Davis who is notoriously=20 averse to delivering bad news had leveled with the public about the=20 fragility of the current system the last two days of blackouts statewide= =20 (except in places with full municipal power like Los Angeles) might not ha= ve=20 come as such a shock.=20 ?????The Legislature tried and failed earlier to solve the alternative ener= gy=20 producers' nonpayment problems with a very complicated bill. Tuesday night= =20 Davis and legislators announced a simpler plan that would set lower more= =20 flexible rates for alternative power but also force the utilities to pay fo= r=20 future purchases.=20 ?????Which leads to the utilities themselves. With the state shelling out= =20 billions for power from the major generators how could Southern California= =20 Edison and Pacific Gas & Electric still not have the cash flow to pay the= =20 alternative producers? That motley collection of biomass solar wind and= =20 cogeneration companies has been shutting down for nonpayment--some of them= =20 because natural gas suppliers have cut them off. PG&E has made some payment= s=20 but SCE has paid zilch though a spokesman says it hopes to strike a deal t= o=20 start paying this week.=20 ?????Without enough honest information conspiracy scenarios fill the holes= .=20 Bad news is better than no news something Davis seems not to quite realize= .=20 By today or Thursday the weather will cool and some plants taken down for= =20 repair will come back online. The blackouts may cease but the crisis will b= e=20 just as deep as it was Monday and Tuesday. It is up to Davis to do a better= =20 job of persuasively explaining why. Otherwise the cynicism grows.=20 --- Wednesday March 21 2001=20 Rolling Blackouts: Blatant Extortion=20 ?????* Re Rolling Blackouts Hit Southland for First Time as Production=20 Falls March 20:=20 ?????So here we are 22 years after the notorious gas shortage having=20 another gun held to our head by an opportunistic energy consortium. Back in= =20 1979 we all had to wait in long lines just to pay more for gasoline. Now = we=20 have to face food in our freezers thawing and simmering in our homes during= =20 hot summer days just to earn the honor of paying more for electricity.=20 ?????Of course as soon as the rates are up and the environmental concerns= =20 are shoved aside watch how plentiful power will be. When is somebody in=20 government going to stand up for the consumer and stop this blatant form of= =20 extortion?=20 ?????JOHN JOHNSON=20 ?????Agoura Hills=20 * * * ?????So customers of PG&E and Edison are shielded from soaring wholesale= =20 prices? Some shield: turning off all our power without so much as a moment= 's=20 notice endangering lives and disrupting businesses just to keep our=20 electricity prices unreasonably low. Let's lift the rate caps to get the=20 lights back on. And if I need to be shielded from soaring prices I'll turn= =20 my own lights off.=20 ?????ANDREW LOWD=20 ?????Claremont=20 * * * ?????This state needs adequate reliable electricity to run a diverse=20 economy. Both political parties and business interests are at fault. This= =20 crisis demands top priority aimed at lasting solutions.=20 ?????The most immediate solution is fast-tracking of added generating=20 capacity. Freeway bridges were rebuilt in record time after the Northridge= =20 quake so we know it can be done. That is the type of effort that is needed= =20 immediately.=20 ?????Since Democrats hold the governorship and control both state legislati= ve=20 houses they are in the driver's seat. If the lights go out the Democrats = go=20 out. If this state government can't solve the problem we need a new=20 government that can.=20 ?????STEVE ANDERSON=20 ?????Huntington Beach=20 * * * ?????The alleged energy crisis in California is entirely contrived to relax= =20 environmental pollution standards and to raise energy rates. It's curious= =20 that the L.A. Department of Water and Power which was not deregulated is= =20 not currently experiencing an energy crisis. PG&E and Edison are both part = of=20 national and multinational corporations. Why should utility customers have = to=20 pay for their economic problems or gross mismanagement?=20 ?????Several power plants were taken off-line for routine maintenance=20 which may not have been so routine. Energy is a vital necessity if these= =20 companies can't provide it at a reasonable affordable rate then they shoul= d=20 be replaced by companies that can be taken over by the government or=20 de-deregulated. There is an abundance of solar energy in California of whi= ch=20 only a small fraction is being utilized. There is no shortage of energy in= =20 California only a shortage of intelligence will and honest politicians.= =20 ?????CHARLES B. EDELMAN=20 ?????Los Angeles=20 --- Utilities' Demand Blocks Bailout=20 NEGOTIATIONS HIT SNAG: PG&E Edison want end to price freeze if they sell= =20 transmission lines to state David Lazarus Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N114450.DTL=20 California's near-bankrupt utilities are demanding that higher electric rat= es=20 be a part of any deal to sell the state their power lines The Chronicle ha= s=20 learned.=20 A rate increase -- perhaps of more than 50 percent according to earlier=20 industry estimates -- would certainly draw a firestorm of protest from=20 consumer groups and force Gov. Gray Davis to backtrack from earlier pledges= =20 that rates would remain unchanged.=20 Nevertheless sources close to negotiations on the deal said Pacific Gas an= d=20 Electric Co. and Southern California Edison are attempting to make higher= =20 rates a condition for agreeing to a bailout scheme in which they would sell= =20 the state their transmission systems and some land.=20 The sources said the talks hit a new snag this week when state officials=20 realized that fine print sought by the companies could require the Public= =20 Utilities Commission to pass along all of the utilities' costs to ratepayer= s.=20 The sources said this would end a rate freeze that shields consumers from= =20 runaway wholesale electricity prices.=20 The inclusion of potential rate increases in the talks reflects the growing= =20 complexity of a deal originally intended by Davis to stabilize the finances= =20 of PG&E and Edison so banks would resume loans to the cash-strapped=20 utilities.=20 The negotiations subsequently have expanded to involve a state purchase of= =20 the utilities' transmission networks and acquisition of utility-owned land= =20 including spectacular coastal property near PG&E's Diablo Canyon nuclear=20 power plant.=20 Now they also have embraced further deregulation of California's=20 dysfunctional electricity market.=20 Clearly one of the terms being discussed is the regulatory environment= =20 said Joseph Fichera head of Saber Partners a New York investment bank tha= t=20 is advising Davis in the talks.=20 The past situation has not worked well he added. The utilities want som= e=20 certainty about their future.=20 TENTATIVE DEAL WITH EDISON To date the governor has announced a tentative agreement with Edison for t= he=20 state to buy the utility's power lines for almost $3 billion. Discussions= =20 with PG&E for a similar accord have dragged on for weeks.=20 An Edison official asking that his name be withheld acknowledged yesterda= y=20 that an end to the rate freeze is an expected result of the power- line sal= e.=20 Once the details of the pact are complete dominoes will fall the offici= al=20 said. One of the dominoes is the rate freeze.=20 A PG&E spokesman declined to comment.=20 In fact both Edison and PG&E have been aggressively seeking an end to the= =20 rate freeze for months.=20 The two utilities have a lawsuit pending in federal court demanding that th= e=20 PUC immediately raise rates so the utilities can recover almost $13 billion= =20 in debt accrued as a result of the freeze.=20 They have been trying a lot of things to get the rate freeze ended in=20 various forms said Carl Wood who sits on the PUC. Adding it to the=20 present talks is consistent with past behavior.=20 Wall Street has taken note that the negotiations no longer appear to be=20 making progress.=20 Paul Patterson an energy industry analyst at Credit Suisse First Boston= =20 told clients on Monday that the discussions may have lost some momentum in= =20 recent days. He did not give a reason.=20 For his part the governor sounded unusually cautious about the course of t= he=20 talks when asked late last week if a breakthrough was imminent.=20 SECRET STICKING POINTS We are going to take the transmission systems and the land that's deeded= =20 and we will work out an agreement Davis said at an appearance in San Jose= .=20 But there are a number of sticking points in the talks with PG&E that I'm= =20 not going to reveal.=20 One of those sticking points apparently is an insistence that the sale of= =20 utility assets include a long-sought lifting of the rate freeze.=20 Sources said lawyers from both PG&E and Edison had inserted the related ter= ms=20 into draft accords affecting each utility and that the full impact of the= =20 additions was not realized by state officials until this week.=20 One source said the language was just convoluted enough to slip beneath the= =20 radar screen of state negotiators. But the upshot once the words had been= =20 parsed was that the PUC effectively would lose control over power rates.= =20 CREDITWORTHINESS ON THE TABLE In Edison's case the terms of the tentative deal include the governor aski= ng=20 the PUC to support the creditworthiness of the utility.=20 This would ensure that future investments in both utility distribution and= =20 utility generation plants are provided fair returns of and on capital=20 consistent with current authorized returns and capital structure provisions= =20 it says.=20 Sources said the provision could be interpreted as a guarantee from the sta= te=20 that Edison would be permitted to recoup all outstanding costs from=20 ratepayers.=20 There may be some assumptions about this language that the rate freeze end= s=20 if it is adopted the Edison official said adding that he saw no reason t= o=20 disagree with such assumptions.=20 But Fichera Davis' adviser in the talks insisted that nothing is set in= =20 stone and that the negotiations are proceeding without a hitch.=20 This is a very complex transaction he said. God and the devil are in th= e=20 details.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Utilities' Demand Blocks Bailout=20 BLACKOUTS ROLL ON: Weather increased consumption blamed=20 David Lazarus Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N156508.DTL=20 Hundreds of thousands of Californians went without electricity for a second= =20 day yesterday as unusually warm weather and a high number of idle power=20 plants prompted blackouts throughout the state.=20 State officials said electricity usage rose yesterday even though condition= s=20 were largely unchanged from a day before. They surmised that fewer=20 Californians were conserving power.=20 We need people to really focus on that implored Patrick Dorinson a=20 spokesman for the Independent System Operator manager of the state's power= =20 grid. The more people can do the better it will be.=20 Rolling blackouts were ordered by the ISO about 9:30 a.m. and were suspende= d=20 at 2 p.m. after several plants that had been down for repairs returned to= =20 service. Additional power also was obtained from a plant in Arizona.=20 Utilities estimated that about 560000 customers were affected yesterday= =20 compared with more than 1 million a day earlier.=20 This week's blackouts marked the first time that people in Los Angeles shar= ed=20 the pain with those in San Francisco. Blackouts in January were confined to= =20 the northern part of the state.=20 FEWER AFFECTED IN SOUTH However Southern California Edison's burden was considerably lighter=20 yesterday than that of Pacific Gas and Electric Co.=20 Karen Shepard-Grimes a spokeswoman for the Southern California utility sa= id=20 only about 50000 customers went without power compared with nearly 440 0= 00=20 for PG&E.=20 Affected areas in the south included Palm Springs Santa Monica Long Beach= =20 and Pomona.=20 We're not in the business of turning customers' lights off Shepard- Grim= es=20 said. We're in the business of keeping lights on.=20 In PG&E's case things were tougher because low rainfall means that less=20 power is currently available from dams throughout the Pacific Northwest.=20 Ron Low a spokesman for the utility said blackouts were experienced by PG= &E=20 customers from Eureka to Bakersfield.=20 Our goal was to carry out the ISO's order with minimal impact on customers= =20 he said.=20 For its part San Diego Gas & Electric said about 75000 customers were=20 darkened.=20 Yesterday's blackouts began with PG&E customers in Block 12 and halted midw= ay=20 through Block 14. Customers in each block -- defined by power circuits rath= er=20 than geography -- typically will lose power for about 90 minutes before the= =20 service interruption rolls elsewhere.=20 Some cutoffs can last more than two hours however because of technical=20 problems switching individual blocks on and off.=20 NEXT UP: BLOCK 14 If additional blackouts are ordered today they will commence with the=20 remaining portion of Block 14 customers. (PG&E customers can determine thei= r=20 block by looking at the bottom left-hand corner of their monthly bill.)=20 The ISO's Dorinson said it is hoped that cooler weather and increased=20 generation will help avert further cutoffs this week.=20 Units are coming back into service that have been out he said. That wil= l=20 help a great deal.=20 Roughly 15000 megawatts of generating capacity was offline yesterday=20 including half of the alternative-energy plants which are unable to afford= =20 natural gas to run their turbines.=20 Many of the plant owners say they have not been paid by PG&E and Edison sin= ce=20 November. They are asking federal regulators for permission to sell their= =20 electricity elsewhere.=20 At the same time one of two units at the Mohave Generating Station in Neva= da=20 damaged in a fire Monday returned to service yesterday easing the load on= =20 California's grid.=20 The plant partly owned by Edison is not expected to return to full output= =20 until tomorrow.=20 PROBING SHUTDOWNS Nearly a third of California's generating capacity is currently down for=20 scheduled or unexpected maintenance. State regulators are investigating=20 whether some plant owners might be deliberately shutting down to drive pric= es=20 higher or reduce operating costs.=20 Loretta Lynch president of the Public Utilities Commission on Monday call= ed=20 the number of idle plants highly suspicious.=20 Dorinson at the ISO said that about 12000 megawatts of mainstream capacity= =20 was offline yesterday compared with roughly 10000 megawatts last year at= =20 this time.=20 --=20 Tell Us What You Think=20 Can you save 20 percent on your energy usage? Gov. Gray Davis is offering= =20 rebates for Californians who save on power starting in June and if you've= =20 got a strategy for conserving The Chronicle wants to hear it. We'll be=20 writing about the hardest-working energy savers in a future story. To get= =20 involved Write to the Energy Desk San Francisco Chronicle 901 Mission St= .=20 San Francisco 94103 or e-mail --=20 THE ENERGY CRUNCH -- Blackouts: About 560000 Californians including 440000 in Northern=20 California lost electricity yesterday for 90 minutes at a time.=20 -- Areas affected: Blackouts hit parts of blocks 12 and 14 and all of block= =20 13 yesterday. In the event of further blackouts the remainer of block 14= =20 would be next followed by block 1.=20 -- Outlook: Officials say blackouts are less likely today as temperatures a= re=20 expected to cool and power plants that have been offline for maintenance=20 resume generating electricity.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Manners Go Out the Window=20 Pedestrians in peril as drivers turn darkened S.F. streets into free-for-al= l=20 Steve Rubenstein Chronicle Staff Writer Wednesday March 21 2001=20 2001 San Francisco Chronicle=20 URL:=20 /21/M N173178.DTL=20 Nobody got plowed into yesterday at Fifth and Howard streets in San=20 Francisco. Many came close.=20 The power outage that darkened the traffic lights at the frenetic South of= =20 Market intersection for more than an hour also darkened the souls of untold= =20 numbers of drivers sending motoring manners into the toilet.=20 The law says motorists are supposed to treat an intersection with=20 nonfunctioning traffic lights as a four-way stop. That means everyone stops= =20 then takes turns -- one by one -- creeping through the intersection.=20 Tell that to the two people in motorized wheelchairs who were nearly creame= d=20 by two eastbound SUVs.=20 Or to the young Swedish couple who had traveled halfway around the globe= =20 only to scamper through the intersection barely ahead of an office supply= =20 truck.=20 Or to the New Jersey tourist who proclaimed that California drivers during= =20 power outages were proof positive that the Chaos Theory lives and breathes.= =20 Some motorists stopped and took turns but many didn't. Some sped into the= =20 intersection immediately behind the vehicle in front without themselves=20 stopping at the white line. Some sailed through with a rolling stop and a= =20 warning honk. Some blasted through without stopping or honking.=20 I'm scared to death said Brian Walters of Dorchester N.J. after making= =20 it across Howard Street. This is organized madness. I subscribe to the Cha= os=20 Theory and this is what it looks like.=20 Sydney Freedman a tourist from Sydney walked briskly across the darkened= =20 crossroads smiling grimly.=20 I'll chance it he said.=20 He looked back and saw a woman in a motorized wheelchair nearly get squishe= d=20 by a westbound Chevy.=20 You have to be authoritative in this town when you cross the street he= =20 said. Especially that lady.=20 Therese Anderson and Andreas Sandstrom from Sweden raced across as quickl= y=20 as their backpacks would allow.=20 In this country everyone is in such a hurry said Anderson.=20 Everybody drives like a madman added Sandstrom. They say 'I want to be= =20 home right now and I don't care what happens to anyone else.' =20 The couple paused to gaze in wonder at the intersection learning more abou= t=20 America in five minutes than a pile of guidebooks could tell them.=20 This intersection said Sandstrom reminds you not to take life for=20 granted.=20 A few minutes later Parking Control Officer Tom Butz arrived in his meter= =20 minder wagon and pulled his orange vest and whistle from the saddlebag. He= =20 strode brave and true into the center of the bullring planted himself=20 between the whizzing cars and began waving his arms as if conducting The= =20 Rite of Spring.=20 I'm all by myself he said. I know it's a little risky. I'd better keep = my=20 angels with me.=20 At that moment the angels were on duty in Menlo Park where a blacked-out= =20 intersection at El Camino Real and Santa Cruz Avenue backed up traffic so f= ar=20 that it stretched into neighboring Atherton.=20 It's a large intersection and traffic is slow anyway but now it is severe= ly=20 impacted said Police Sgt. Terri Molakides. We don't get any warning=20 either. When the power is out the power is out. It's not like we can make= =20 any plans.=20 In general motorists seemed more likely to obey the four-way-stop rule on= =20 the Peninsula and in the East Bay than in San Francisco.=20 In San Mateo County some police departments have stopped trying to make=20 advance plans to cover darkened intersections. San Mateo Police Sgt. Kevin= =20 Rafaelli said putting up signs and posting officers sometimes caused proble= ms=20 rather than solving them.=20 If people just follow the law (and) stop at the intersection they can=20 handle it better than we do if we're out there he said. People are sort = of=20 getting used to it and are dealing with it.=20 In Berkeley and Emeryville motorists stopped one at a time at temporary st= op=20 signs with no apparent problems. At University Avenue and Sacramento Stree= t=20 in Berkeley Officer Matt Meredith said motorists were behaving themselves.= =20 That wasn't the case a while back when a driver who didn't stop at an=20 intersection during a blackout was broadsided by someone who did Meredith= =20 said.=20 The thing to remember is to stop and look he said.=20 TRAFFIC TIPS To avoid a collisions during blackouts the California Highway Patrol offer= s=20 this advice to motorists:=20 -- Treat any intersection with inoperative traffic lights as a four-way sto= p.=20 Each vehicle must stop when arriving at the white limit line then proceed= =20 only when safe taking turns.=20 -- If two vehicles arrive at the intersection at the same time the motoris= t=20 on the left must yield to the motorist on the right.=20 -- Never insist on taking the right of way even if you are entitled to it.= =20 -- Follow the directions of a police officer or traffic control officer=20 whose directions take precedence over lights or signs.=20 Chronicle staff writers Henry K. Lee and Matthew B. Stannard contributed to= =20 this report. / E-mail Steve Rubenstein at 2001 San Francisco Chronicle ? Page?A - 8=20 --- --- Historic Blackouts in State=20 Bay Area learns to cope=20 Jonathan Curiel George Raine Justino Aguila and Matthew B. St Tuesday March 20 2001=20 2001 San Francisco Chronicle=20 URL:=20 /20/M N219412.DTL=20 Today's rolling blackouts caused concern throughout the Bay Area including= =20 Colma where the sudden lack of power apparently caused a fire.=20 A light fixture at the Home Depot store in Colma caught fire around 10:45 a= .=20 m. 15 minutes after Pacific Gas and Electric Co. ordered blackouts for the= =20 area. No one was hurt.=20 I was in the back of the store when the power outage started said Dave= =20 Cole a consultant from Pacifica who was shopping for bolts and screws. We= =20 lost maybe 90 percent of the lights then maybe 10 percent of the lights ca= me=20 up. Then I heard a guy saying 'Get a ladder get a ladder!'=20 One of the lights on the ceiling had caught on fire and a couple of peopl= e=20 were getting ladders and fire extinguishers.=20 Store managers whisked everyone out of the store and Colma firefighters=20 arrived to make sure the blaze was extinguished.=20 At 11 a.m. Cole was waiting to get back into the store which was still=20 closed.=20 I need my bolts he said.=20 Elsewhere the San Francisco Fire Department had to rescue people stuck in = an=20 elevator at 2001 Embarcadero North said fire department spokesman Pete=20 Howes.=20 Scores of residents and businesses near the Embarcadero including the Levi= =20 Strauss & Co. headquarters were affected by the blackout.=20 At Levi Strauss this morning Phil Marineau the president and chief=20 executive officer led his 1300 employees by example using only minimal= =20 lighting for a meeting in his office at 10 a.m.=20 Employees were sent e-mails minutes after PG&E's 9:30 a.m. notification tha= t=20 a blackout was possible. The e-mails said workers should frequently save wo= rk=20 on their computers and that they should remain in the building and stand b= y=20 for further instructions.=20 Emergency lighting in hallways and stairwells were operated by generators.= =20 All elevators descended to the ground floor but one remained operating=20 through a generator.=20 Worked nicely said Jeff Beckman a company spokesman.=20 Yesterday -- the first day that rolling blackouts returned -- Shannon=20 Cashman's home in Walnut Creek was a difficult place to be.=20 Cashman's 4-year-old daughter Madison suffers from a brain defect that=20 stops her from breathing during sleep. The girl depends on a ventilator tha= t=20 runs on electricity.=20 Recently hospitalized and with a weakened immune system Madison badly need= ed=20 a nap yesterday afternoon. But when the Cashmans' power went out about noon= =20 it meant reading and coloring instead of rest for the girl and a little mor= e=20 anxiety than normal for her mother.=20 If this was a major earthquake or something like that and we couldn't use= =20 the ventilator we'd take her to the hospital said the 33-year-old Cashma= n.=20 Otherwise we'll just wait for the power to come back on.=20 In a stroke of irony yesterday the lights went out and computer screens we= nt=20 dark at the San Francisco offices of the state Public Utilities Commission= =20 the agency some people blame for the energy crisis and others look to for t= he=20 solution.=20 At a Petco animal store in Redwood City nocturnal leopard geckos that=20 weren't familiar with the state's power woes thought it was night and awoke= =20 from their routine daytime slumber.=20 The geckos clung to the glass of their cages as manager Sally Daine and her= =20 employees misted lizards and watched frozen mealworms melt.=20 The worst thing is some of the reptiles need heat but it's so hot I don'= t=20 think it will matter she said.=20 At Auto Pride Car Wash a few blocks away Dan Giudici watched as the team o= f=20 employees he supervised washed cars the old-fashioned way -- with buckets a= nd=20 hoses. The company's big mechanical car wash went unused.=20 Customers didn't seem to mind the manual wash said Giudici who was chargi= ng=20 half-price. But he was running out of towels.=20 Even those who hoped they were immune to power problems were affected.=20 Palo Alto runs its own utility but the electricity began winking out about= =20 12:30 p.m.=20 The city depends on a distribution line of the state grid so it is=20 vulnerable to blackouts said Linda Clerkson public relations manager for= =20 Palo Alto Utilities. In addition the city relies on PG&E for some of its= =20 power she said.=20 Businesses were caught by surprise.=20 Well at least it happened in a better time than the morning said Nick= =20 Badiee owner of the Lytton Roasting Co. coffee house. My toaster went out= =20 and the coffee began getting cold so I lost three or four people who walke= d=20 out the door. I'm not angry yet but I would say I am concerned.=20 For one Milwaukee woman visiting San Francisco the blackout was an=20 unexpected lesson in the problems of electricity deregulation.=20 Cindy Wilburth a financial consultant who advises Wisconsin utilities cam= e=20 to the Bay Area for vacation but left yesterday with important research for= =20 her job.=20 This has been a huge learning lesson for Wisconsin Wilburth said as she= =20 waited for a bus outside the powerless Comfort Inn by the Bay in Cow Hollow= .=20 Wilburth said her state and others that once eyed deregulation are now=20 backing off.=20 It just makes me realize how we've gotten ourselves in a pinch in a free= =20 economy she said.=20 As she mused about the predicament in which the state has found itself her= =20 friend was just thankful to get out of here.=20 I love the cold compared to this said Cindy Stuckey of Milwaukee. At= =20 least I know I can stay in my home secure and warm.=20 Across the street at the Travelodge By the Bay Rolando Gutierrez had=20 already lost three guests just an hour into the blackout.=20 This is the richest state and this is a rich city -- plenty of people want= =20 to come here he said. We shouldn't be suffering these blackouts.=20 Chronicle staff writers Jaxon Van Derbeken Mark Martin Henry K. Lee=20 Michael McCabe Bernadette Tansey and Marshall Wilson contributed to this= =20 report.=20 2001 San Francisco Chronicle ? Page?A - 1=20 --- --- Bay Area residents learning to roll with blackouts=20 Posted at 9:58 p.m. PST Tuesday March 20 2001=20 JOHN=20 WOOLFOLK=20 AND STEVE=20 JOHNSON=20 Mercury News=20 As rolling blackouts swept the state for a second straight day Tuesday=20 Californians already seasoned by droughts and earthquakes were learning to= =20 live with yet another upheaval: periodic power outages.=20 Blackouts are still a novelty in Southern California -- hit for the second= =20 time Tuesday -- but they're almost routine for Bay Area residents who have= =20 seen four days of outages this year and now expect many more as temperature= s=20 rise. Toting flashlights avoiding certain roads and even shutting off thei= r=20 coveted hot tubs they're adjusting to life in California's new Dark Age.= =20 ? ? Karen T. Borchers--Mercury News When the lights went out at Grant Elementary School in San Jose on Tuesday= =20 morning teacher Renee Johnson took her second-grade students out to the la= wn=20 to read to them. Marjorie Meagher now looks at her clock before taking the elevator she need= s=20 to get around her two-story San Jose home fearing she'll get stuck during= =20 rolling blackouts.=20 ``They tend to happen on the hour or half-hour so I try not to use it=20 then'' said Meagher 74 who is disabled. ``I'm very careful. My own=20 personal fear is getting stranded in the elevator.''=20 From 750000 to about 1 million customers lost power for an hour or so in= =20 stages Tuesday as a rash of power plant outages and record temperatures in= =20 San Jose and elsewhere triggered a critical shortage.=20 As was the case Monday when 1.2 million to 1.8 million customers were=20 affected Tuesday's outages were split between the northern and southern=20 parts of the state. Blackouts began at 9:30 a.m. and lasted until 2 p.m. wh= en=20 authorities obtained extra power from other Western states. Outages were=20 considered less likely today.=20 But people are preparing anyway. Like low-flow toilets and earthquake kits= =20 flashlights and generators may be emerging as another fact of life in the= =20 Golden State.=20 In San Francisco's Inner Sunset district Han Yong Park had the satisfied= =20 smile of a well-prepared man having bought a portage generator for his Park= 's=20 Farmers Market five months ago.=20 Tuesday morning the generator churned loudly on the sidewalk positioned= =20 between the tomatoes and green beans. Inside clerks tallied purchases on= =20 electric cash registers.=20 Park motioned down the street where neon signs were dark and some=20 restaurants closed. ``No one else in the area has a generator'' he said.= =20 Energy officials say such equipment will come in handy this summer. Power= =20 supplies are expected to be so strained that Californians should expect man= y=20 more rolling blackouts.=20 ``I don't want to kid anybody'' said Patrick Dorinson spokesman for the= =20 California Independent System Operator which manages the power grid for mo= st=20 of the state. ``Supplies are very very tight. When you look at such a big= =20 state and such a large shortfall I think we have to prepare ourselves. It'= s=20 very possible that going into this spring and summer we're going to see som= e=20 very difficult days.''=20 Combination of factors=20 The multiple causes that conspired to darken California on Tuesday=20 underscored the difficulty officials face in keeping the lights on.=20 The thermometer shot to record-breaking levels at some locations in the Bay= =20 Area driving up power demand. San Jose hit 83 compared with an average 66= =20 degrees for March 20 and breaking the record high of 80 set in 1960.=20 What's more 12000 megawatts of power were unavailable because plants had= =20 shut down for maintenance or because cash-strapped utilities haven't paid= =20 them.=20 And consumer conservation has been spotty. While state energy officials say= =20 conservation rose from 5 percent in January to 8 percent in February grid= =20 managers said this week Californians weren't saving enough energy. They eve= n=20 revised their estimate of how much homes a megawatt can power down from=20 1000 homes to 750 to reflect greater consumption.=20 Improved conservation later in the day helped stave off a second wave of=20 outages they said.=20 Many shrug off the threat of rolling blackouts.=20 ``I think I've gotten used to it'' said Mary Carlson 58 of San Jose who= =20 took her granddaughter for a walk and read the paper during blackouts in=20 January. ``I just go with the flow. I'm not going to get too excited about= =20 it. If they turn the power off it's no big thing.''=20 Erica Finn secretary at Acacia Glass in San Francisco said she wasn't too= =20 upset when blackouts shut down the credit card machines electric sanders a= nd=20 phones. She bought coffee pulled a chair into the sun and popped Madonna= =20 into her portable CD player.=20 ``I have to brush up on my tan and get paid for it'' she said.=20 But for others the consequences are potentially serious.=20 At a Palo Alto dental office the blackouts interrupted root canals for thr= ee=20 patients. Dentists Darrell Dang Robert McWilliams and Kurtis Finley insert= ed=20 temporary fillings by hand rescheduled the procedures and went to lunch.= =20 The receptionist used a cell phone to cancel the afternoon's appointments= =20 frustrated that there's no way to prevent a repeat of Tuesday's fiasco if t= he=20 blackouts continue.=20 A new routine=20 Others have taken everyday steps to cope with the threat of losing power.= =20 Stephen O'Reilly a 34-year-old San Jose engineer who often drives to see= =20 clients said he avoids side streets because blackouts could darken signal= =20 lights and tie up intersections.=20 ``I used to take back roads to avoid traffic but I'm trying to use the=20 freeways more because there are no lights'' said O'Reilly adding that he'= s=20 shut down his electric hot tub to help conserve power.=20 At Pasta Primavera in San Mateo manager Chris Harris has stocked up on=20 candles and has plans to buy a generator for his restaurant. When blackouts= =20 arrived just before the lunch crowd Tuesday and cut power to ventilation=20 fans he even considered revising his menu replacing smoke-producing chick= en=20 and shrimp with simple marinaras and alfredos.=20 ``I don't know if you'd want to dine with the smell of smoke'' Harris said= =20 as customers trickled into his darkened restaurant on Fourth Avenue. ``If= =20 this is going to continue through the summer it's going to affect our=20 pockets.''=20 San Francisco International Airport which agreed months ago to shut down i= ts=20 massive air conditioners to save power during shortages is now routinely= =20 stuffy.=20 On Tuesday the temperature reached a steamy 85 degrees inside the airport's= =20 North Terminal which serves most of United Airlines' flights.=20 ``It's become uncomfortable if not intolerable'' said Ron Wilson airport= =20 spokesman. ``It's like getting in a car that's been left in the sun all day= .=20 It's much hotter inside. .?.?. We've turned on the fans but they're just=20 moving the hot air.''=20 Hospitals cut off=20 Several hospitals complained they lost power Tuesday saying they thought= =20 they were exempt. PG&E said hospitals with sufficient backup generation to= =20 power themselves can be turned off. But state regulators said they could no= t=20 confirm that statement and hospital officials scoffed at the suggestion.= =20 ``Every hospital has backup power generation but it only covers 30 to 40= =20 percent of the hospital'' said Roger Richter a senior vice president with= =20 the Hospital Council.=20 Nonetheless hospitals are coping with the situation.=20 ``Our patients are concerned for sure'' said Jackie Floyd head nurse at= =20 the Satellite Dialysis Center South in San Jose which lost power. ``But=20 while it's a pain we can handle the blackouts. We're kind of getting the= =20 idea here that this a problem and we have to adjust.''=20 But while Californians may be adjusting they're not at all pleased.=20 ``I'm frustrated with this power thing'' said Ana Rivera who manages the= =20 Wash Club in San Francisco where washers and dryers had stopped mid-cycle.= =20 ``Who do you blame? No one wants to accept blame.'' Sara Neufeld Ann Marimow Kim Vo Frank Sweeney Barbara Feder Aaron Davi= s=20 Gil Duran and Dave Beck contributed to this report.=20 --- --- Powerless again=20 Outages were lighter after generators came back online and conservation=20 efforts kicked in. Blackouts may be averted today.=20 March 21 2001=20 By TONY SAAVEDRA JOHN HOWARD CHRIS KNAP and JEFF COLLINS The Orange County Register=20 The Ridgewood Power methane-burning plant at the Olinda Alpha landfill in= =20 Brea is producing 3.3 megawatts down from five because Edison owes it $1.= 5=20 million and cranking up to full power is no longer a priority Photo: H. Lorren Au Jr. / The Register ? ? A second day of statewide blackouts ratcheted up the frustration level=20 Tuesday on the streets of Orange County and in Sacramento as consumers=20 demanded solutions from politicians unable to give them.=20 There was a bit of good news though: Blackouts may be averted for the rest= =20 of the week after temperatures moderated two stalled generators came back= =20 online and conservation efforts kicked into gear.=20 ?=20 Some Orange County residents took the blackouts in stride. In Mission Viejo= =20 above the West Coast Football Club's under-16 boys team scrimmages under= =20 gas-powered lights Tuesday. The club has been running to conserve energy=20 Photo: Kevin Sullivan / The Register ? ? Consumers were able to save 900 megawatts - enough to light about 675000= =20 homes - by cutting power usage said Patrick Dorinson spokesman for the=20 Independent System Operator which oversees 75 percent of the state's=20 electricity grid. That helped the ISO halt the blackouts Tuesday afternoon.= =20 Californians are back on the conservation trail and we appreciate it=20 Dorinson said.=20 Power regulators Tuesday morning predicted there would be twice as many=20 outages as Monday when more than 1 million consumers statewide lost power = in=20 one-hour to 90-minute increments.=20 Luis Pagan an assistant at the Santa Ana Animal Shelter waits out the=20 blackout Tuesday with one of the shelter's dogs up for adoption Photo: Paul E. Rodriguez / The Register ? ? Beginning at 9:30 a.m. Tuesday blackouts tangled intersections in Costa=20 Mesa forced Huntington Beach students to study by flashlight and stilled= =20 cash registers in Santa Ana. About a half-million homes and businesses were= =20 unplugged statewide before 2 p.m. Power was restored to most of Southern=20 California by 11:30 a.m. Outages affected more than 9200 consumers in Oran= ge=20 County.=20 The ISO had expected more severe outages to hit at the peak hour of 7 p.m.= =20 but was able to keep the lights on as downed power plants came back online= =20 and imports from other states increased.=20 While outages were lighter than Monday the blackouts aggravated consumers= =20 who doubted that Gov. Gray Davis lawmakers and electricity officials are= =20 doing enough to keep the power flowing in California.=20 ?=20 Zulema Avarez left and Erica Ramirez said they were caught off-guard when= =20 the power went out so they closed the fashion store in Santa Ana where the= y=20 work Photo: Paul E. Rodriguez / The Register ? ? I think this is insane said Charlee Lang 63 of Costa Mesa. Gray Davis= =20 didn't do his job for a long time he didn't get serious until November. We= =20 need to demand immediate action be taken.=20 Bill Brannick 65 of Costa Mesa added: There's a lot of complicity here= =20 and we're just innocent victims.=20 Davis in a Sacramento news conference said he inherited California's fail= ed=20 experiment with electricity deregulation enacted in 1996 under former Gov.= =20 Pete Wilson.=20 I think a fair assessment of this situation is that we were dealt a pretty= =20 bad hand here Davis said. No (new power) plant was approved in the 12=20 years prior to my being governor.=20 With summer peak demand expected to be 16000 megawatts higher than Monday= =20 and Tuesday more days of blackouts are forecast for coming months. Though= =20 Davis has signed long-term contracts to provide California with reliable=20 energy the deals haven't yet taken effect. Some suppliers won't start=20 providing electricity until the state reaches a so-far elusive agreement to= =20 help the utilities pay off billions in debt by buying their transmission=20 lines.=20 Assembly Republican Leader Bill Campbell R-Villa Park said that the effor= t=20 to resolve the state's energy crisis was floundering in the midst of unpai= d=20 bills stalled negotiations and rolling blackouts.=20 Tuesday began with 29 percent of California's power supply off line mostly= =20 from generating plants suddenly down for unscheduled maintenance. About 30= 00=20 megawatts was missing from so-called qualifying facilities or small power= =20 producers who have not been paid $1.8 billion by cash-strapped utilities an= d=20 say they can't afford to operate. Davis said he would ask the PUC to order= =20 utilities to begin paying the qualifying facilities for any energy supplied= =20 beginning April 1 but the payments would not apply to the outstanding debt= .=20 Some smaller producers threatened to force Edison into involuntary bankrupt= cy=20 if they are not paid soon.=20 Blackouts began Tuesday two hours earlier than on Monday as the ISO called= =20 on utilities to dump 500 megawatts. It was only the second day of blackouts= =20 for Southern California but the fourth for Northern California since=20 January.=20 The Disney Resort which includes Disneyland and the new California=20 Adventure voluntarily cut back one megawatt of electricity on Monday and= =20 again Tuesday said Anaheim Public Utilities.=20 All of the reductions were in backstage areas not seen by guests said Disn= ey=20 spokeswoman Chela Castano-Lenahan.=20 In other workplaces people tried to make do.=20 Flashlight beams bobbed in aisles at a Target in Santa Ana where the power= =20 stopped at 10:30 a.m. Workers escorted customers who continued shopping an= d=20 made their purchases at battery-powered cash registers. Customers were=20 eventually asked to leave when the batteries ran low.=20 Oh well no soda no sunglasses said one woman as she headed back to her= =20 car.=20 The Metro Pointe shopping center in Costa Mesa also went dark.=20 I was in the middle of making a reservation when everything went out sai= d=20 Peggy Thomas a sales executive for Travel of America along South Coast=20 Drive. All of us here went 'Oh no it's happened to us.' =20 Said one Costa Mesa police officer as he headed for his motorcycle and a= =20 blackout-related fender bender: You can thank the governor for that one.= =20 At Hawes Elementary School in Huntington Beach Principal Marie Smith was= =20 demonstrating to her third-grade class what would happen in a blackout. But= =20 before she could flip off the light switch the power died.=20 The kids thought she was joking.=20 Register staff writers Tiffany Montgomery Sarah Tully Tapia Nancy Luna J= im=20 Radcliffe Binh Ha Hong Theresa Salinas Eric Johnson and Danielle Herubin= =20 and the Associated Press contributed to this report.=20 --- --- The iceman shunneth effects of hourlong blackout=20 March 21 2001=20 By JIM RADCLIFFE The Orange County Register=20 Ken Ackerman owner of ABC Ice House in Laguna Niguel checks on his frozen= =20 inventory during Tuesday morning's rolling blackout. The ice managed to=20 endure the hourlong power outage Photo: Jebb Harris / The Register ? ? Ken Ackerman didn't sweat much when a blackout struck his Laguna Niguel ice= =20 business at 10:30 a.m. Tuesday.=20 The walk-in freezer at ABC Ice House held 8 tons of ice. And for an hour t= he=20 temperature in there rose from 20 degrees to 45 degrees.=20 But very little melted.=20 Ackerman said most refrigerators can handle blackouts as long as outages ar= e=20 less than two hours.=20 I think people are going to get used to one-hour blackouts and realize it'= s=20 not a problem'' Ackerman said.=20 The blackouts actually were profitable for Ackerman.=20 An Irvine laboratory struck by a power outage bought 100 pounds of dry ice = to=20 preserve human tissue.=20 More blackouts through the summer could be a boon for the ice business - or= a=20 bust.=20 It could mean more ice sales -- or that his supplier has trouble filling hi= s=20 orders.=20 It's going to be an interesting summer'' Ackerman said.=20 I have no idea if we'll make more or less.''=20 Traffic will be the biggest problem if blackouts continue Ackerman said.= =20 On Monday a nearby Costco that had lost power ordered 200 pounds of ice to= =20 keep its refrigerated goods cold.=20 But dead traffic lights and congested roads made it impossible to deliver t= he=20 ice before the outage ended. Costco canceled the sale.=20 We pride ourselves on getting our deliveries made in an hour Ackerman=20 said.=20 --- --- Traffic officials are seeing red over blackouts=20 Battery backups are planned by several cities to aid confused drivers.=20 March 21 2001=20 By HEATHER LOURIE The Orange County Register=20 Traffic backs up Tuesday at Crown Valley Parkway at Forbes Road in Laguna= =20 Niguel as drivers had to navigate their own way Photo: Jebb Harris / The Register ? ? Toby Tran approached an Aliso Viejo intersection and wasn't sure what to do= .=20 Ahead of him the traffic signal was dark a casualty of the rolling=20 blackouts that struck Orange County on Monday and Tuesday.=20 So Tran kept driving smacking into an oncoming car at the corner of Aliso= =20 Creek and Enterprise.=20 It just happened a shaken Tran 29 said from his Aliso Viejo home. I= =20 tried to stop and I couldn't. There was no light. Nothing.=20 Tran's accident Monday afternoon and several others like it underscore on= e=20 of the most significant dangers looming in the threat of future blackouts.= =20 Traffic signals that fade to black when the power goes out instead of=20 converting to flashing red make wrecks far more likely because drivers=20 become confused and frustrated traffic engineers and experts said Tuesday.= =20 I didn't know what to do said Tran who was on his way to a high school= =20 jogging track. Luckily I'm alive but I'm very scared.=20 On Day 2 of Southern California's power outages worried city officials=20 across Orange County hunted for ways to respond to paralyzed intersections= =20 when state regulators pull the plug.=20 We need to be ready said Hamid Bahadori traffic engineer in the city of= =20 Orange. This thing is only going to get worse in July and August.=20 One popular idea: installing emergency battery-backup units at traffic=20 signals to keep lights flashing red during blackouts. Several Orange County= =20 cities including Irvine Laguna Niguel and Orange are already moving to= =20 install the devices as early as this summer.=20 In our minds (a flashing light) is a vast improvement over a blacked-out= =20 signal said Dave Rogers Laguna Niguel traffic engineer. On Tuesday night= =20 his city was expected to approve the purchase of the battery packs for all = 74=20 of its traffic signals.=20 Timing in this case seems to be everything Rogers said. A lot of citi= es=20 had contemplated it. We just took it that extra step.=20 John Thai an Anaheim traffic engineer cautioned that cities need to do=20 adequate research and testing before they launch into such projects.=20 There is nothing that is foolproof Thai said. All this is new territory= .=20 Some cities are also considering rolling out temporary stop signs and sendi= ng=20 police officers to more intersections.=20 Although the state's vehicle code requires motorists to treat dead traffic= =20 signals like a four-way stop motorists often blow through the intersection= s=20 police said.=20 It's dangerous said Tustin police Lt. Mike Shanahan after several=20 near-wrecks in his city during Monday's outages. People are not very good = at=20 reacting to changes in their conditions.=20 Flashing red is something that catches your eye. It's a warning that=20 something is amiss but the absence of all lights is worse.=20 RELATED STORIES=20 =01=07 How to contact your Representatives =01=07 'Current' events =01=07 The iceman shunneth effects of hourlong blackout =01=07 Powerless again =01=07 Alternative power producers cut back or shut down as payments from b= ig=20 utilities lag =01=07 O.C. saves its energy -- for blaming others =01=07 Blackout readiness on agenda --- --- Alternative power producers cut back or shut down as payments from big=20 utilities lag=20 That is a factor in blackouts=20 March 21 2001=20 By HANH KIM QUACH The Orange County Register=20 Every megawatt of electricity counts in this deregulated energy market -=20 including the five megawatts generated from the Olinda Alpha landfill in=20 Brea.=20 The methane-burning plant is producing only 3.3 megawatts now because=20 Southern California Edison owes it $1.5 million and cranking up to full pow= er=20 is no longer a priority said Martin Quinn executive vice president of=20 Ridgewood Power which runs the plant.=20 We're doing maintenance now when we ordinarily wouldn't do it. Because we'= re=20 not being paid it was a good time to cut back'' Quinn said.=20 That scenario has been playing out across the state in the past two weeks a= nd=20 was a major factor in Monday's and Tuesday's blackouts.=20 Those who provide electricity through alternative means - burning methane o= r=20 wood chips or using cleaner-burning technology with traditional fossil fue= ls=20 - are not being paid for what they sell to the big utilities. So they eithe= r=20 can't afford to produce energy or see little incentive to do so.=20 On Monday their absence from the statewide electricity grid created a=20 1300-megawatt shortfall -- enough to power 1.3 million homes.=20 Taking that much power offline meant that any burp in the system would put= =20 the state under the minimum amount of electricity needed to avoid blackouts= .=20 When one conventional Southern California plant went down because of a=20 transformer fire Monday the blackouts began.=20 If all of California's (alternative) generators were operating yesterday a= nd=20 today rolling blackouts would have been avoided'' Quinn said Tuesday.=20 Within the next couple of weeks as the weather warms and alternative energ= y=20 producers continue to try and operate without money California could see= =20 twice as many of those producers go offline further increasing the potenti= al=20 for blackouts said Jan Smutny-Jones executive director of Independent=20 Energy Producers.=20 The alternative energy producers which provide about a third of the state'= s=20 energy are deemed so crucial that Gov. Gray Davis wants the Public Utiliti= es=20 Commission to order the utilities to pay them. As drafted though the orde= r=20 would only include payment on future sales it doesn't address existing deb= t.=20 The Legislature has been working since January to halve the rates that=20 alternative producers charge utilities and to require utilities to pay for= =20 November's energy by April 1. But that bill is still moving through the=20 Legislature.=20 Small plants threaten Edison with bankruptcy=20 Smutny-Jones said that if the small generators are not paid promptly sever= al=20 will attempt to force Edison into bankruptcy probably within a week.=20 Unlike the large natural-gas generators that have been paid by the state=20 Department of Water Resources alternative energy producers are locked into= =20 contracts with utilities. Collectively Pacific Gas & Electric and Edison o= we=20 alternative energy producers about $1 billion.=20 PG&E has paid about 15 cents for each dollar it owes.=20 Obviously they're a source of generation and looking at how much load ou= r=20 customers need they're a source that has provided energy'' said Jon=20 Tremayne Pacific Gas & Electric spokesman. We've been trying in good=20 faith to make payments on energy.''=20 But Edison has not paid any money. Edison's alternative energy director La= rs=20 Bergmann said the company will not pay until larger reforms are made in ho= w=20 the producers' rates are calculated.=20 But the company recognizes that its nonpayment is causing problems.=20 To the extent that there are hundreds of megawatts that are idled here it= =20 just exacerbates the (energy) problem. ... They're facing similar problems = to=20 what we faced - they don't have sufficient (income) coming in the door''= =20 Bergmann said.=20 Plants go into mothball mode=20 Millenium Energy in Kern County is owed $40 million total by PG&E and Ediso= n.=20 On March 1 the company shut down both of its coal and petroleum coke-burni= ng=20 plants and doesn't plan to bring them back up until it is paid.=20 Millenium's plants which use a special technology to reduce emissions=20 generate 150 megawatts of energy.=20 We've gone into mothball mode our machinery just sits there on cold=20 standby'' said President Mike Hawkins. We've been delivering free electro= ns=20 to the system in the hope that the system would resolve itself. But we can'= t=20 do that anymore.=20 One biomass plant in Lassen County has scaled back from 31 megawatts to=20 eight. Burney Forest Power burns wood chips to produce energy and has only = a=20 couple weeks' supply of chips left.=20 When you don't even know what you'll get paid it's hard to say 'Let's go= =20 out and get a bunch of fuel''' said Milt Schultz the plant's general=20 manager.=20 The sad thing is (the state) really can't afford to lose us.''=20 --- --- O.C. saves its energy -- for blaming others=20 March 21 2001=20 By RICHARD CHANG The Orange County Register=20 Darkened stores were forced to turn away customers as stock manager=20 Bridgette Kelly left does here at a Linens 'n Things in Costa Mesa. The= =20 store closed for 45 minutes Tuesday morning Photo: Michael Kitada / The Orange County Register ? ? Orange County residents are making efforts large and small to conserve=20 electricity as they face rolling blackouts and surging energy bills.=20 Reactions to the early spring crisis - with blackouts throughout the state= =20 Monday and Tuesday - are ranging from confusion to rage.=20 Many residents have taken practical steps such as turning off lights they'= re=20 not using waiting until off-peak hours to do their laundry and opening=20 windows instead of using air conditioning.=20 My house is full of Philips energy-saving light bulbs said Ray Rutledge= =20 48 of Buena Park. Our light bill has dropped 7 1/2 percent. We use=20 low-voltage outdoor lighting. We've got an energy-saving thermostat. It's s= et=20 back to 65 (degrees) in the wintertime.=20 Kim Wilson who lives in an unincorporated area of Orange County near Santa= =20 Ana and Tustin said he has cut down on lighting in his house and has reduc= ed=20 by half the time his pool cleaner runs. Still his energy bill remains abou= t=20 $400 a month.=20 I don't know what ... to do Wilson 57 said. We've cut back.=20 Wilson added that he is not pleased with the way government or the energy= =20 companies have handled the crisis.=20 I think it's disgusting. It's such political garbage. Who was it that made= =20 these decisions? Who got us into it?=20 'TRYING TO CONSERVE'=20 Jenny Hann 60 of Costa Mesa said her workplace has devised an emergency= =20 plan for conservation and future blackouts.=20 We're definitely trying to conserve as much as we can the bank=20 administrator said. Hann expressed frustration with the energy companies.= =20 When you see these executives that have been running the show and the mone= y=20 they're making it's bothersome she said.=20 Jennifer Souto 27 of Tustin said even though she's a stay-at-home mother= =20 she keeps the lights off all day. She doesn't use her air conditioning=20 either.=20 Souto said she was locked out of her house for 90 minutes Monday because a= =20 blackout cut power to her garage door. She says she's not sure who to blame= .=20 Paul Finch 38 of Westminster blames Edison and Gov. Gray Davis.=20 I don't believe info I get from Edison or from our illustrious governor= =20 Finch said. There's more to it than how they've represented it.=20 --- --- Blackout readiness on agenda=20 O.C. companies braced for outages Tuesday in different ways. Not all were= =20 struck but they felt the effects.=20 March 21 2001=20 By TAMARA CHUANG The Orange County Register=20 In case of a power failure Tuesday the Fluor Corp. in Aliso Viejo stocked= =20 elevators with homemade blackout kits filled with cookies flashlights and= =20 bottles of water.=20 They're in the elevators although we've been told not to use the=20 elevators said Lori Serrato a company spokeswoman. We're using the=20 stairwells waiting for our time of darkness.=20 Tales of anxious preparation were more common than actual blackouts for=20 Orange County businesses Tuesday.=20 Edison told some companies as special power users who've agreed to cut bac= k=20 when asked to expect to do so. Conexant Systems Inc. got a warning from=20 Edison and immediately shut down air conditioning and equipment not in use= =20 and stopped production. The blackout never came.=20 Kingston Technology Co. when notified by Edison on Tuesday morning=20 broadcast the warning on the company intercom. The company also e-mailed=20 employees a guide explaining the blackout.=20 It's already affected productivity. We've been busy getting all our e-mail= s=20 out before it happens said Heather Jardin a spokeswoman for the Fountain= =20 Valley computer memory maker.=20 Kingston still had power by day's end but in an emergency the company's= =20 manufacturing plants revert to Kingston's own power generators Jardin said= .=20 Heart valve maker Edwards Lifesciences turned on its backup generators=20 Tuesday morning because of the potential for there to be a blackout in ou= r=20 area said company spokesman Scott Nelson. But (as of 3:30 p.m.) the=20 blackout didn't materialize Nelson said.=20 At the regional office in Irvine Verizon Wireless implemented conservation= =20 efforts such as motion sensors that shut off lights after 30 minutes of=20 inactivity and separate heating and air conditioning units on all floors.= =20 Some of the company's cell sites in Orange County and Los Angeles did lose= =20 power Monday and Tuesday but they automatically switched to backup battery= =20 sources.=20 Other companies - PacifiCare ICN Pharmaceuticals Beckman Coulter and=20 Allergan - said they took precautions turning out some hallway lights and= =20 communicating safety procedures to employees.=20 Disneyland Ingram Micro in Santa Ana and Western Digital Corp. in Lake=20 Forest all were prepared.=20 But none reported blackouts by day's end.=20 Some county businesses did get hit.=20 Businesses along the 900 block of South Coast Drive - including 14 stores a= t=20 the Metro Point shopping center in Costa Mesa - went dark about 10:20 a.m.= =20 All of a sudden it was dark said Henry Gonzalez manager of Boudin Baker= y.=20 We ran out of coffee. We couldn't bake anything. We tried to accommodate a= s=20 best as we can.=20 Other stores simply closed during the blackout frustrating shoppers.=20 We walked over to (Marshalls) and it was dark and there was a sign on the= =20 door that said 'Due to the blackout we're closed' said shopper Roberta= =20 Allison a West Virginia tourist. Don't they warn people here? Do they jus= t=20 whack the power off?=20 Marshalls employees escorted customers out of the store when the power went= =20 out. Other stores including Nordstrom Rack and Best Buy were not affected= .=20 Across the street from the center employees spilled out of office building= s=20 cheering and waving their hands in victory as power outages forced them to= =20 halt work.=20 Lots of people just walked out of the office to run errands said Amy=20 Bateman a loan officer at Capital Funding Group in Costa Mesa.=20 She said her office building at 940 South Coast Drive went dark for about= =20 70 minutes. Like dozens of others in the building she was working at her= =20 desk when the computers and lights went dark.=20 We've just been sitting around. We can't do anything said Bateman.=20 The blackout hit other businesses on Monday.=20 Buy.com employees spent their hour without power using their wireless=20 Blackberry pagers to answer and send e-mail.=20 The Crazy Horse Steakhouse in Irvine lost power after the lunch rush said= =20 Donna Mulkey the restaurant's manager. Since the broilers remained hot th= e=20 cooks kept cooking and the customers kept eating. When they finished waite= rs=20 calculated the bills by hand.=20 At Broadcom Corp. in Irvine the power went out just before Rep. Christophe= r=20 Cox was to tour the facility.=20 It struck me as particularly ironic Cox told members of the House=20 subcommittee on energy and air quality Tuesday that Broadcom's co-founder= =20 Henry Samueli spent the hour before the meeting using a letter opener to= =20 open his paper mail and sitting by the window so he could get some sunlight= =20 to read.=20 Cox R-Newport Beach told the panel which was holding a hearing on=20 California's electricity crisis that the entire company could not functio= n=20 during this period of time and the same was true for more than a million=20 people he said. It's a Third World experience in California.=20 Register reporters Chris Farnsworth Dena Bunis Bernard Wolfson Nancy Lun= a=20 Eric Johnson Elizabeth Aguilera and Jennifer Hieger contributed to this=20 story.=20 --- --- Calif To Order Utils To Pay Small Generators Up Front-Gov 03/21/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 SACRAMENTO Calif. (AP)-- California regulators will order the state's two= =20 largest utilities to pay small independent power generators in advance a= =20 move Gov. Gray Davis hopes will bring a quick end to the blackouts that=20 darkened California this week.=20 Davis accused PG&E Corp. (PCG) unit Pacific Gas & Electric Co. and Edison= =20 International (EIX) unit Southern California Edison of taking in money from= =20 customers while failing to pay the generators known as qualifying=20 facilities which produce up to one-third of the state's power. As a result= =20 he said the utilities are partly responsible for this week's blackouts.=20 It's wrong and irresponsible of the utilities to pocket this money and not= =20 pay the generators the governor said at a Capitol news conference Tuesday= =20 evening. They've acted irresponsibly and immorally and it has to stop.=20 The state lost about 3100 megawatts or enough electricity to power 3.1=20 million homes on Tuesday from alternative energy plants that say they can'= t=20 afford to keep operating because the utilities haven't paid their bills in= =20 weeks. The utilities which are near bankruptcy owe the QFs about $1=20 billion. Pacific Gas & Electric has made partial payments.=20 As reported by Dow Jones Newswires Southern California Edison met with=20 representatives of the governor Tuesday to discuss plans to begin making=20 partial payments to the QFs. Pacific Gas & Electric which called Davis'= =20 statements inappropriate and unjustified said it has informed the QFs an= d=20 the governor's office that it plans to begin paying the QFs in full going= =20 forward.=20 Davis said the PUC planned to issue an order next week directing the=20 utilities to prepay future bills to the QFs.=20 Edison and PG&E say they have lost more than $13 billion since last June to= =20 climbing wholesale electricity prices which the state's 1996 deregulation= =20 law prevents them from passing on to ratepayers. California has been spendi= ng=20 about $45 million a day since January to buy power for the utilities'=20 customers but hasn't included QF-generated power in its purchases.=20 Keepers of the state's power grid were cautiously optimistic that Californi= a=20 might get through Wednesday without another day of rolling blackouts after= =20 two idle plants were returned to service. A Stage 1 power alert the mildes= t=20 of three forms of alerts was called around 6 a.m. Wednesday as power=20 reserves fell to around 7 percent.=20 About a half-million customers were hit by Tuesday's blackouts which snarl= ed=20 traffic and plunged schools and businesses into darkness from San Diego to= =20 the Oregon border. Tuesday's outages began at 9:30 a.m. and continued in=20 90-minute waves until about 2 p.m. when the ISO lifted its blackout order.= =20 They were blamed for at least one serious traffic accident.=20 The blackouts were caused by a combination of problems including=20 unseasonably warm weather reduced electricity imports from the Pacific=20 Northwest numerous power plants being shut down for repairs and the loss o= f=20 power from QFs.=20 Meanwhile a leading lawmaker on energy issues said the PUC may soon have t= o=20 raise rates by about 15% to cover the state's costs and its utilities' bill= s.=20 My sense is that people will appreciate having some certainty and being ab= le=20 to plan for it said Assemblyman Fred Keeley. They don't have to like it= =20 but I think they'll appreciate it.=20 Davis has said he is confident the utilities and the state can pay their=20 bills without further rate increases.=20 --- --- PG&E Says It Is Negotiating With Qualifying Facilities 03/21/2001=20 Dow Jones Energy Service=20 (Copyright (c) 2001 Dow Jones & Company Inc.)=20 (This article was originally published Tuesday)=20 =20 LOS ANGELES -(Dow Jones)- PG&E Corp. (PCG) unit Pacific Gas and Electric Co= .=20 said Tuesday it is offering small generators or qualifying facilities= =20 prepayment of $200 million per month so they will have the funds to return = to=20 the state power grid.=20 But high level sources at the qualifying facilities who are involved in the= =20 negotiations said PG&E's proposal is incomplete and doesn't address the iss= ue=20 of past due payments.=20 The sources said PG&E had discussions with some qualifying facility operato= rs=20 last week regarding the plan and it wasn't accepted at that time.=20 About 3000 megawatts of power from qualifying facilities or QFs have bee= n=20 off the state's grid since Monday because the generators weren't being paid= =20 by utilities and couldn't afford to continue operating. The QFs unavailable= =20 power was partly responsible for Monday and Tuesday's statewide rolling=20 blackouts.=20 Also Tuesday California Gov. Gray Davis will hold a press conference to=20 discuss progress made in negotiations with the QFs to revise their contract= s=20 with the state's two nearly-bankrupt utilities so that the utilities pay le= ss=20 for power.=20 Edison International (EIX) unit Southern California Edison also said Tuesda= y=20 it intends to make partial payments on an ongoing basis to some QFs.=20 Edison executives met with Gov. Gray Davis' negotiating team Tuesday to=20 discuss how and when SoCal Ed can begin to make payments and a spokesman= =20 said they hope to have a plan in a matter of days.=20 Pacific Gas & Electric Co. has made partial payments of about $51 million t= o=20 the QFs it contracts with but owes much more. Edison owes the QFs hundreds= =20 of millions of dollars and hasn't paid the QFs since November. Together th= e=20 two utilities owe QFs about $1 billion.=20 PG&E said it has been collecting about $400 million per month from ratepaye= rs=20 to pay QFs and other generators with which it has bilateral contracts the= =20 state grid operator for spot power purchases and costs of its own=20 generation.=20 The average combined bill for those costs exceeds $1.4 billion per month= =20 PG&E said.=20 This mismatch between revenues and costs requires tough choices. Since the= re=20 isn't enough money in rates to cover all these costs the Public Utilities= =20 Commission decision on how this $400 million will be allocated going forwar= d=20 will determine our ability to make advance payments to QFs said Gordon R.= =20 Smith the utility's president and CEO.=20 The PUC is responsible for implementing the legislation which allows the=20 state to buy power and will decide how much of utilities' ratepayer revenue= =20 will go to the state for power purchases and how much will go to the=20 utilities.=20 For several weeks a number of QFs have taken their generating units offlin= e=20 because they can no longer afford to buy fuel needed to run their units.=20 QFs supply California with one-third of its total power supply.=20 PG&E and SoCal Ed have almost $13 billion in purchased power undercollectio= ns=20 because they cannot collect full costs from customers protected by a=20 state-mandated rate freeze.=20 -By Jessica Berthold Dow Jones Newswires 323-658-3872=20 -(Jason Leopold contributed to this article.)=20 --- -------------------- Wednesday March 21 2001=20 By Dave Todd=20 dtodd@ftenergy.com=20 U.S. Energy Secretary Spencer Abraham declared this week that the Big Apple= =20 is on the verge of being bitten hard by power cuts and rising energy prices= . Delivering the keynote address at the U.S. Chamber of Commerce's national= =20 energy summit in Washington Monday Abraham said California is not the on= ly=20 state facing a mismatch between supply and demand what with electricity= =20 shortages predicted for New York City and Long Island this summer and low= =20 capacity margins threatening electricity reliability elsewhere across the= =20 country. But how likely is it that New Yorkers will face blackouts of the= =20 sort confronting Californians?=20 Not very says energy trade specialist Edward Krapels managing director of= =20 Boston-based METIS Trading Advisors. Krapels a consultant helping major=20 Northeastern utilities such as Consolidated Edison design market-hedging= =20 programs adamantly decried what he said are facile comparisons between=20 conditions in New York and California there being more differences than= =20 there are similarities between those two industrial cornerstones of the=20 country's economy in respect to energy security management.=20 First of all New York has a more varied portfolio of energy generation=20 sources than California he said. California has hydro nuclear and gas b= ut=20 when it lost a lot of hydro the state needed gas to pick up the slack and= =20 the capacity just wasn't there. In New York's case the state has oil and= =20 coal still in the mix and its overall dependence on gas is much lower than= =20 California's Krapels added.=20 New York avoids making same mistakes Portfolio diversity is one pillar of any effective plan to help New York=20 avoid the same errors made in redesigning California's marketplace. New=20 York's Independent System Operator (ISO) in a new report warning that the= =20 state is at an energy crossroads in terms of its capacity adequacy in the= =20 immediate future argues that a concerted effort is required to arrest=20 declining in-state generation capacity reserve margins and a strategy must= =20 be put in place whether or not new generation comes on-line in accordance= =20 with current anticipated scenarios.=20 A measure of New York's essential difficulty is that between 1995 and 2000= =20 statewide demand for electricity grew 2700 MW while generating capacity= =20 expanded by only 1060 MW. With no major new generating plants in downstate= =20 New York fully approved the gap is expected to continue to widen. To avoid= =20 a replication of California's market meltdown the New York ISO calculates= =20 the state's daily generating capacity needs to grow by 8600 MW by 2005 wi= th=20 more than half of that located in New York City and on Long Island.=20 Expressing concern this may be too big a burden for the current bureaucrati= c=20 process to bear the ISO wants to see a state-appointed ombudsman named to= =20 help would-be merchant power plant investors plow through red tape.=20 Increasing New York's generating capacity will also lessen the state's=20 escalating and risky reliance on out-of-state sources of electricity the= =20 ISO added. Since 1999 New York State has been unable to cover its reserve= =20 requirements from in-state sources.=20 Not everyone agrees with that analysis insofar as it argues for circling t= he=20 wagons inward. Some analysts believe the ultimate solution lies not in tyin= g=20 in more inwardly dedicated power but in expanding the marketplace by=20 breaking down inter-jurisdictional barriers. In any case New York energy= =20 regulatory authorities and those responsible elsewhere in the U.S. Northeas= t=20 such as PJM (Pennsylvania-New Jersey-Maryland) Interconnection and the New= =20 England Power Pool are in vastly better shape in terms of cross-border= =20 cooperation than California and its neighbors in that efforts are being mad= e=20 among various authorities toward developing an integrated regional=20 electricity market. In California by contrast the state's focus=01*for=20 example in the case of new gas-fired power plant development=01*has been t= o=20 ensure dedicated supply to the California market alone rather than on a=20 regional marketplace.=20 The New York ISO's new broad-based analysis of market-restructuring needs= =20 argues that the relatively stronger health of its reformed environment is= =20 due in large part to the ability of New York's utilities to enter into=20 long-term power contracts.=20 What needs to be done most it says is to move aggressively to build some = of=20 the more than 29000 MW of proposed new generation in the siting pipeline.= =20 In the meantime the 30200 MW of electricity New Yorkers used on a peak da= y=20 last summer shouldn't be eclipsed on too many days this coming summer (give= n=20 early long-range weather forecasts). Demand however is expected to increa= se=20 at an annual average rate of up to 1.4%.=20 So while New York City the rest of the state and adjacent parts might=20 breathe easy this year it could be a brief rest from the fray. Meanwhile = a=20 4% shortfall is still being planned for this summer that is not yet provide= d=20 for as authorities hurriedly seek to arrange new generation plants around= =20 Manhattan on Long Island and even on barges offshore.=20 One way or another whether it is the weather or the politics of siting new= =20 energy facilities it's going to be a hot time in the city.=20 Long-term solutions hit brick wall Meanwhile attempts at longer-term solutions continue to run into trouble.= =20 Last week Connecticut state regulators came out against a proposal to run = a=20 new underwater cable under Long Island Sound that Hydro-Quebec subsidiary= =20 TransEnergie U.S. Ltd. wants to build to pump more juice into Long Island= =20 Power Authority's load pocket. Despite strong promises from TransEnergie to= =20 be diligent in avoiding damage to oyster beds in Long Island Sound the=20 proposal failed to convince authorities who were persuaded the pipeline=20 project could lead to diversion of electricity from Connecticut.=20 In similar fashion private companies wanting to build 10 small independent= =20 power plants and temporary generators offshore New York City are running in= to=20 intense opposition from environmental groups and citizen organizations=01*s= ome=20 of whom have taken their cases to the state assembly in Albany.=20 The David vs. Goliath nature of such controversies has further alerted ener= gy=20 companies to the difficulties of addressing complex energy supply issues th= at=20 may ultimately devolve to people not wanting things in their backyard=20 regardless of what the alternative might mean to their fellow citizens or t= he=20 greater public good.=20 But suddenly in New York California's troubles=01*while still distant in = their=20 intensity=01* may not be so far away. By some estimates this summer's bill= s for=20 Consolidated Edison customers could be up as much as one third or more over= =20 last year's charges.=20 Letting the time slip when it comes to building new infrastructure isn't=20 going to make the pain go away.=20 =20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: In Phoenix, AZ to talk to Catholic Diocene Physical Plant Managers - Body:: Lay the groundwork and educate them about what's going on around the country from a regulatory standpoint sensitize them to coming opportunities. Also Steve Barth will be there to talk about creative products / services we can offer. 1:00 - 2:30 presentation then q&a then cocktails and dinner sponsored by Enron. Per Gary von Fischer 614-792-6010 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: PERSONAL AND CONFIDENTIAL COMPENSATION INFORMATION Body:: Thanks for the information. It would be helpful if you would send the detailed worksheet that you mentioned. I am surprised to hear that the only restricted shares left are the ones granted this January. I have always elected to defer any distributions of restricted stock. I believe I selected the minimum amount required to be kept in enron stock (50%). Are you saying that all the previous grants have fully vested and been distributed to my deferral account? Thank you for looking into this issue. Phillip What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Request for Confidential Information by the GAO Body:: To All California Power Exchange Participants: Notice is hereby provided pursuant to Section 19.3.4 of the California Power Exchange Tariff that the United States General Accounting Office (GAO) as part of the ongoing investigation of California markets has requested the same information to be provided to the Federal Energy Regulatory Commission (FERC). Such information may be confidential under Section 19.3.2 of the Tariff. The manner in which the GAO will treat such confidential information is outlined in the attached letter. The GAO states that it has authority under 31 U.S.C. 717 to evaluate programs or activities of the Federal Government in this case deregulation of the electricity markets initiated by FERC. The GAO has requested the California Power Exchange to provide such information no later than Thursday October 5 2000. If you desire to assert a claim of privilege or confidentiality pursuant to legal authority the California Power Exchange will include your written assertion of that claim together with its submittal to the GAO provided that it is timely received. Your written statement should be directed to the GAO as follows: Mr. Jim Wells Director Energy Resources and Science Issues United States General Accounting Office Washington DC 20548 You may deliver your statement to the California Power Exchange as follows: Karen Koyano California Power Exchange 1000 S. Fremont Avenue Unit 20 Alhambra CA 91801 626.537.3173 facsimile Any written statement must be received by Ms. Koyano no later than Wednesday October 4 2000 5:00 p.m. Pacific Daylight Time to be included with any information delivered to the GAO. You are also free to take any other legal action you may deem appropriate in the circumstances of this investigation. Thank you. (See attached file: GAO Letter 9-22-00.doc) - GAO Letter 9-22-00.doc What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Sac Bee Wed 6/6: Businesses vie for blackout exemptions:=20 The PUC must decide who should be spared and the applicant list is very lo= ng Sac Bee Wed 6/6: PG&E ISO agree to court order on power bills Sac Bee Wed 6/6: Peter Schrag: Turning up the heat in Houston and=20 Washington (Editorial) SD Union Wed 6/6: Is trading an insider's game? SD Union Wed 6/6: Daily energy costs for state fall in past weeks=20 SD Union Wed 6/6: Five tiers sought in proposed rate boost SD Union Wed 6/6: Port budget large but power bills loom SD Union Wed 6/6: Continuous use urged for planned power plant=20 SD Union Wed 6/6: Rising energy prices threaten Poway troupe=20 SD Union Wed 6/6: Fair to use generators for midway attractions LA Times Wed 6/6: 'Hi My Name Isn't Justice Honey' and Shame on Lockye= r =20 (Editorial) LA Times Wed 6/6: U.S. Probes Alleged Pact Not to Build New Plants Power:= =20 Justice officials focus on Southland operations of two firms which deny=20 wrongdoing LA Times Wed 6/6: Natural Gas Power Prices Drop Sharply Energy:=20 More conservation mild weather are among factors keeping costs down exper= ts=20 say LA Times Wed 6/6: The State Utility Averts $1 Billion in Costs Courts:=20 PG&E and Cal-ISO agree to recognize Department of Water Resources as=20 purchaser of the power SF Chron Wed 6/6: Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited SF Chron Wed 6/6: San Jose council gives green light to generating plant= =20 VOTE REVERSAL: Officials pressured to OK project SF Chron Wed 6/6: Developments in California's energy crisis SF Chron Wed 6/6: California conserves SF Chron Wed 6/6: L.A. power customers awash in cheap energy SF Chron Wed 6/6: PG&E doesn't want to pay for energy to avert blackouts Mercury News Wed 6/6: Metcalf plant gets preliminary approval=20 OC Register Wed 6/6: Feds probe AES Williams Individual.com (PRnewswire) Wed 6/6: Calpine Begins Construction of=20 Peaking Energy Center in Gilroy Calif.=20 Individual.com (PRnewsire) Wed 6/6: Reliant Urges FERC to Drop or Amend= =20 California Price Caps to Avoid Additional Shortages and More Blackouts Energy Insight Wed 6/6: Farm-fresh biopower --- Businesses vie for blackout exemptions: The PUC must decide who should be= =20 spared and the applicant list is very long. By Carrie Peyton and Dale Kasler Bee Staff Writers (Published June 6 2001)=20 Mixes for milkshakes and frozen coffees could spoil at ice cream parlors= =20 sickening customers.=20 Seniors getting their hair done would have to leave their dryers and go hom= e=20 with wet heads risking a chill.=20 Mall escalators could come to a sudden halt endangering shoppers who lose= =20 their footing.=20 Those are among the health and safety risks cited by more than 10000=20 businesses and government bodies asking state regulators to exempt them fro= m=20 rolling blackouts.=20 It is a list that mixes nursing homes and grocery stores outpatient surgic= al=20 clinics and beauty salons dialysis centers and country clubs.=20 A lot of people are treating this like a lottery said Subodh Medhekar of= =20 Exponent Inc. the consulting firm sorting through exemption requests for t= he=20 state Public Utilities Commission.=20 For many Medhekar said the rationale seems to be 'I'm pretty sure I won= 't=20 get exempted but what's the down side? Let's put in an application.' =20 Amid predictions that Californians could face dozens of rolling blackouts= =20 this summer state regulators are trying to update a decades-old list of wh= o=20 should be spared if the lights go out.=20 The Alta Sierra County Club in Grass Valley should be among those whose pow= er=20 stays on Sean O'Brien the club's golf course superintendent told=20 regulators in a nine-page application.=20 The country club telephones could go out making it harder to phone for hel= p=20 if someone has a medical problem while golfing he said in an interview.=20 And if the golf course's irrigation pumps shut down it would lose the=20 ability to quell small blazes -- leaving it to rely on a fire station O'Bri= en=20 said is about one-quarter mile away.=20 Placerville Dialysis wants an exemption too. As many as a dozen people the= re=20 can be having their blood pumped through an artificial kidney that cleans i= t=20 when their own kidneys no longer function properly.=20 When the power goes out everything just stops said manager Shirley=20 Carpenter. There is a way to manually return the blood by hand before it= =20 clots in the line. ... It would just be hectic.=20 It takes about five minutes of manual pumping to fully disconnect someone= =20 from a dialysis machine Carpenter said. And some patients can help by=20 operating their own pumps.=20 But she said I'm sure it would be kind of frightening to have your blood= =20 out in the line and the power off and they're pretty much tied to the=20 machine.=20 Pam Chin a hairdresser at the Loomis Beauty Salon said the owner sought a= n=20 exemption because people could get overheated if the air conditioning went= =20 out and older customers getting their hair set could be chilled if the=20 dryers shut off.=20 With about half the state already exempt from rolling blackouts the questi= on=20 of who else should stay connected has become a delicate one for utilities= =20 regulators and legislators.=20 Carl Wood the PUC commissioner who has taken the lead on blackout issues= =20 estimates that fewer than 1000 more utility customers can be exempted befo= re=20 they overload the rolling outage system designed to take stress off the=20 electric grid.=20 While about 6000 customers are classified as essential by the state's tw= o=20 largest utilities keeping them out of the blackout rotation also spares=20 about 5 million other customers who are served by the same circuits.=20 That multiplier effect will have to be weighed by the consulting firm by= =20 utilities and eventually by PUC commissioners who are scheduled to vote in= =20 early August on who should be added to existing standards.=20 The rules will apply to the state's investor-owned utilities Pacific Gas a= nd=20 Electric Co. Southern California Edison and San Diego Gas & Electric Co.= =20 but not to municipal utilities.=20 The Sacramento Municipal Utility District already rejected pleas for specia= l=20 exemptions from a medical lab a veterinary hospital nursing homes medica= l=20 facilities businesses and residents. SMUD believes they can weather=20 blackouts because they are not critical to public safety.=20 People have counted on having dependable electricity for so long that some= =20 have widely varying ideas of who can do without it safely Medhekar said.= =20 Of the more than 500 Baskin Robbins ice cream parlors that dot California= =20 only five are listed on the PUC Web site as applicants for exemptions.=20 The site cautions that its list of 9239 electronic applicants hasn't been= =20 checked for duplicates -- or fiction. It includes hundreds of outlets of th= e=20 same drug store and supermarket chains dozens of related nursing homes and= =20 more than 400 dentists. Another 1200 commercial power users have applied b= y=20 fax.=20 Among those who have confirmed they want out of outages are the grocery=20 chains operated by West Sacramento-based Raley's which said it took the=20 action as part of united effort with all California grocers who are worrie= d=20 about food spoilage.=20 Others in the mix are Fairfield's Westfield Shoppingtown Solano formerly t= he=20 Solano Mall where officials sought the exemptions out of fear that shopper= s=20 would get injured if escalators came to a sudden halt.=20 The Yolo County Housing Authority asked for an exemption on behalf of its 7= 00=20 dwellings in the belief that the utilities offer exemptions for low-income= =20 Californians Executive Director David Serena said.=20 Serena added that many of the authority's occupants are older or disabled a= nd=20 could be endangered by a blackout.=20 Chevron Corp. acknowledged it couldn't show that a blackout at its refineri= es=20 would present imminent danger to public health or safety but it asked Go= v.=20 Gray Davis to support legislation exempting makers and transporters for=20 critical fuels saying a refinery shutdown would cut into the state's=20 gasoline supply.=20 Some businesses acknowledged that their applications are a long shot.=20 It's probably a stretch said Amanda Leveroni who owns Bacio Catering Co= .=20 of Chico about her request to the PUC. The public wouldn't be in danger.= =20 But we're a catering company -- somebody has planned for a year-plus for a= =20 wedding or some big event she added. I would be in such a huge situation= .=20 I'd have to send out for pizza.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com. PG&E ISO agree to court order on power bills By Claire Cooper Bee Staff Writers (Published June 6 2001)=20 SAN FRANCISCO -- Pacific Gas and Electric Co. and the operator of=20 California's power grid agreed Tuesday to a preliminary court order providi= ng=20 that the utility will continue to receive -- but not pay -- generators' bil= ls=20 for the state's purchases of the most expensive wholesale electricity.=20 The tab has been running at about $300 million a month.=20 The order which U.S. Bankruptcy Judge Dennis Montali said he'll sign will= =20 specify that the Independent System Operator will not procure power except= =20 for a creditworthy buyer who has agreed to pay the generator.=20 In California the only such potential buyer is the state Department of Wat= er=20 Resources. However the department which has avoided PG&E Co.'s bankruptcy= =20 proceedings by claiming sovereign immunity will not be controlled by the= =20 agreement. Montali pointed out that the department still could demand=20 reimbursement from PG&E.=20 Under the agreement the ISO will not press any claims against PG&E on beha= lf=20 of generators if they are not paid.=20 The proposed preliminary injunction was based on an April order by the=20 Federal Energy Regulatory Commission which forbade the ISO from purchasing= =20 power on behalf of any non-creditworthy buyer such as PG&E.=20 The ISO is appealing the FERC order. If the appeal succeeds the injunction= =20 will end.=20 Peter Schrag: Turning up the heat in Houston and Washington (Published June 6 2001)=20 Behind all the palaver about the predictable standoff at last week's energy= =20 summit between President Bush and Gov. Gray Davis one major political=20 development was missed.=20 Put simply in the past month the focus of the California energy crisis an= d=20 maybe the onus as well has moved east: from the state's (and Davis')=20 handling of the mess to the generating companies energy marketers and gas= =20 pipeline companies that have richly profited from it and thus to FERC the= =20 do-next-to-nothing Federal Energy Regulatory Commission and the Bush=20 administration.=20 That wasn't all Davis' doing -- far from it -- though it's been at the hear= t=20 of his message about energy industry pirates and profiteers. Bush's=20 misbegotten energy plan and the administration's political clumsiness also= =20 contributed mightily not least by inadvertently giving Davis the chance to= =20 get media exposure he could only have dreamed about.=20 More important there's the defection of Sen. James Jeffords from the=20 Republican Party and the resulting shift of control in the U.S. Senate whe= re=20 the next chair of the Energy Committee will be Sen. Jeff Bingaman of New=20 Mexico a co-sponsor of Sen. Dianne Feinstein's bill capping wholesale=20 electric rates for the next two years. And chairing the Committee on=20 Governmental Affairs will be Sen. Joseph Lieberman of Connecticut who's=20 already asked for an audit of energy prices.=20 Those changes will draw a lot more attention to recent studies showing that= a=20 handful of big generators -- Duke Power Reliant Mirant Dynegy and the hu= ge=20 energy-marketing firm Enron -- have gamed the market to drive wholesale=20 prices to levels that in the year 2000 sometimes reached 40 times the=20 prices of the year before.=20 The findings come not merely from economists at the California Independent= =20 System Operator the agency that manages the state's grid who estimate=20 overcharges resulting from market power at $6.2 billion for last year alone= .=20 They come also from Severin Borenstein and his colleagues at the University= =20 of California Energy Institute who conservatively calculate the=20 overcharges at $4.5 billion from Paul Joskow a widely respected energy=20 economist at MIT and from Edward Kahn an economic analyst in San Francisc= o.=20 In a recent paper published by the National Bureau of Economic Research=20 Joskow and Kahn conclude that there's considerable evidence that the high= =20 prices experienced in the summer of 2000 reflect the withholding of supplie= s=20 from the market by suppliers [generators or marketers] exercising market=20 power. That those high prices occurred not merely during peak usage but al= so=20 at off-hours when no one had ever seen a price spike before makes those= =20 spikes even more curious.=20 There is in addition the powerful suspicion that the huge increase in=20 natural gas prices that a subsidiary of El Paso Energy Co. now the largest= =20 gas company on Earth was charging on the California side of the=20 California-Arizona border wasn't merely the result of an innocent imbalance= =20 between supply and demand.=20 None of that may be illegal. If there's no collusion there are no violatio= ns=20 of antitrust laws. But it adds plenty of steam to the political argument. I= n=20 the 2000 election cycle alone energy companies kicked in some $64 million = in=20 political contributions 75 percent of it to Republicans. At a time when=20 those companies many of them located in the same Houston neighborhood are= =20 racking up astronomical profits and when their collective coziness with Bus= h=20 and the Republican Party is a lot more than rhetoric their vulnerability t= o=20 a vigorous Senate investigation ought to be obvious.=20 The clincher is Blackout a Frontline program that both symbolizes the= =20 shifting emphasis and reinforces it. (The program is scheduled to be aired = at=20 8 p.m. Friday on Sacramento cable Channel 7.) It isn't another recital of= =20 Californians worrying about their electric bills or about the stupidity of= =20 the state's deregulation scheme or how Davis dithered in addressing the=20 crisis. It is about those generators and marketers in Houston and North=20 Carolina men (and a few women) who regard themselves as the heroes of the= =20 new energy markets.=20 The piece is reported by Lowell Bergman who in working for both Frontline= =20 and the New York Times has already broken major print stories about Duke=20 Power's secret approach to Davis offering unspecified energy refunds in=20 return for an end to state investigations and lawsuits. Bergman also report= ed=20 private conversations between Enron chairman Kenneth Lay a major Bush=20 supporter and FERC chairman Curt Hebert regarding the influence that Lay= =20 could exercise with Bush to allow Hebert to keep his chairmanship if Hebert= 's=20 supported certain decisions Enron badly wants.=20 None of these recent events is likely to end Davis' political woes and the= y=20 may not produce the wholesale rate caps Feinstein wants and that most=20 economists think necessary -- or maybe any significant reduction in the=20 industry's predatory pricing. But they will surely help turn up the heat= =20 both in Houston and Washington. Six months ago FERC found wholesale prices= =20 were not fair and reasonable as federal law requires but did little abou= t=20 them. It will now have a lot more questions to answer.=20 Peter Schrag can be reached at Box 15779 Sacramento CA 95852-0779 or at= =20 pschrag@sacbee.com. Is trading an insider's game?=20 Buying selling of electricity is a growth business but some say deck is= =20 stacked against consumers By Craig D. Rose=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 While Californians decry deregulation's failure to deliver a competitive=20 market electricity wholesalers have quietly developed a vast and rapidly= =20 growing business of buying and selling power among themselves.=20 The deals take place on high-tech trading floors in Houston and elsewhere= =20 around the country as well as on Internet-based trading systems.=20 Some experts say this electricity trading is a key mechanism for raising=20 consumer power prices yet it's largely unregulated.=20 Electricity trading is like buying stock -- when you have ability to chang= e=20 the stock price said Frank Wolak a Stanford University economics profess= or=20 and member of the state grid operator's market surveillance group.=20 Energy companies say the buying and selling of contracts to deliver power= =20 provides risk management allowing plant owners to presell their electricit= y=20 lock in prices and avoid fluctuations. The rough and tumble of the free=20 market they add is the most efficient means of allocating a resource like= =20 electricity.=20 But industry critics say trading is far from a competitive market paradigm.= =20 In their view it's a means of communication -- a way for energy insiders t= o=20 collude and raise prices under the guise of competition.=20 To be sure the trading arms of major energy companies have emerged as star= s=20 in an industry where profit surges of 300 percent or 400 percent are not=20 uncommon.=20 The transactions shrouded in secrecy can leave ownership of a critical=20 commodity in unknown hands. Consider the case of power generated by AES=20 Corp.'s California plants.=20 In 1998 AES made a bold move. Immediately after purchasing power plants th= at=20 gave it control of 10 percent of the state's electric generating capacity= =20 the company sold the output from its plants for the next 20 years to Willia= ms=20 Cos.=20 Williams did not sit on this treasure trove of electrons. The Tulsa Okla.= =20 company soon sold 80 percent of what it bought.=20 It is difficult to say who owns that power now. Some might be owned by Semp= ra=20 Trading a sister company of SDG&E. Or some could be owned by Enron Corp.= =20 the nation's biggest electricity trader.=20 A spokeswoman for Williams conceded that Williams itself may have repurchas= ed=20 some of the electricity it sold earlier. But trading companies closely guar= d=20 their positions.=20 This much can be said with certainty: Electricity that AES sold for less th= an=20 5 cents per kilowatt-hour to Williams changed hands perhaps 10 times in the= =20 wholesale market and emerged at times in recent months with a price tag for= =20 consumers that was 300 percent higher.=20 Williams' trading profits increased by 523 percent in the first quarter thi= s=20 year. Advance sales All this buying and selling creates curious confluences.=20 In their attempt to deflect criticism over high prices generating companie= s=20 such as Duke Energy -- operator of the South Bay Power Plant in Chula and= =20 others in the state -- frequently note that they sell most of their=20 electricity far in advance. But they acknowledge less often that their=20 trading units may also be buying power which could boost the company's=20 electricity inventory.=20 Duke was the fourth biggest electricity trader last year and cited its=20 trading activity as a prime contributor to its wholesale business profits= =20 which soared 324 percent in the first quarter to $348 million.=20 It is a company's power traders who frequently direct plant operators to=20 increase or decrease the generation of power in response to market=20 conditions.=20 Energy companies have little option but to turn to trading for profits. One= =20 of the better kept secrets of electrical deregulation and its promise of=20 competition is that there is remarkably little competition in the productio= n=20 side of the business.=20 For one thing electricity is a commodity power from one company is=20 indistinguishable from that generated by others.=20 More important nearly all modern plants generate power from turbines built= =20 by a handful of manufacturers. The result? Modern plants owned by different= =20 companies produce power at nearly identical cost.=20 The cost of power produced by modern plants is all within a mil=20 (one-thousandth of a dollar) said Michael Peevey an adviser to Gov. Gray= =20 Davis and former president of Southern California Edison.=20 So the extraction of profit in the electricity business relies much more on= =20 trading. Traders' profits rise when prices are volatile -- plunging or eve= n=20 better rising sharply. Little regulation But despite the obvious temptation to manipulate the market the burgeoning= =20 electricity trading business has remained largely unregulated.=20 The Federal Energy Regulatory Commission does require quarterly filings fro= m=20 energy traders but these often provide incomplete information or at least= =20 little that has been of concern to FERC.=20 In fact although the trading of electricity grew more than a hundredfold= =20 from 1996 to 2000 FERC has taken no major enforcement action against a=20 trader. After the onset of the California crisis last year FERC has acted= =20 once. That was against Williams which agreed to pay $8 million without=20 admitting guilt to resolve an allegation that it withheld supply to pump up= =20 prices.=20 FERC's record of enforcement in the area of power trading stands in contras= t=20 to a long list of enforcement actions within other markets taken by the=20 Securities Exchange Commission and the Commodity Futures Trading Commission= .=20 FERC has recently added staff to its market oversight operations. But Willi= am=20 Massey a FERC commissioner says the agency's effort is still inadequate.= =20 Electricity can be flipped stripped and chopped up Massey said. It's a= n=20 extraordinarily complicated market.=20 The sophisticated marketers and traders have simply moved past us. We're= =20 kind of horse and buggy in our approach and they're out there in rocket shi= ps=20 flying around ... The problem is that sophisticated traders don't necessari= ly=20 produce reasonable prices. They produce profits.=20 Before deregulation electricity trading was a low-key affair. Regulated=20 utilities dealt power back and forth on a reciprocal basis to fill=20 electricity shortfalls in their control areas. There was little trading for= =20 profit until the mid-1990s after federal legislation and FERC rulings open= ed=20 the market.=20 Major traders include large energy companies sister companies of=20 California's major utilities and Wall Street firms. Market volatility In many ways the trading of power is similar to that of other commodities.= =20 But there are important differences. Because it cannot be stored and its us= e=20 is so fundamental the price of electricity is the most volatile of all.=20 When supplies are tight a single supplier can rapidly raise prices to=20 budget-busting levels as evidenced by Duke Energy's recent admission that = it=20 charged California nearly $4000 for a megawatt-hour of power a quantity= =20 that probably sold hours earlier for one-tenth of that sum or less.=20 Wolak the Stanford economist and state Sen. Joseph Dunn D-Garden Grove= =20 who is investigating the state power market say trading allows companies t= o=20 collude under the guise of competition. Instead of wringing out lowest cost= s=20 the wholesale trading market serves to raise prices they say.=20 As I trade to you and you trade to me we communicate to each other what= =20 price we would like to get said Wolak. It's not collusive. It's just=20 communicating price.=20 Mark Palmer a spokesman for Enron the nation's biggest power trader said= =20 California's problem is not the result of trading.=20 It's a result of shortages Palmer said.=20 Underscoring its emphasis on trading Enron's new headquarters tower in=20 downtown Houston rises from a six-story block of new trading floors=20 including expanded space for electricity trading.=20 Enron also pioneered trading in cyberspace and its Enron Online site claims= =20 to be the most active computer-based trading market.=20 The Houston company argues that consumers won't fully benefit from power=20 trading and deregulation until they have greater choice in choosing their= =20 power supplier. And the company says FERC has not done enough to open acces= s=20 to transmission lines which would allow traders to move power around the= =20 country. To that end Enron has lobbied hard for President Bush's plan for = a=20 national electricity grid.=20 Palmer says the notion that the price of electricity rises each time it is= =20 traded is mistaken.=20 The market is always looking for the real price of a commodity Palmer=20 said.=20 Dunn the California state senator says his investigation found a differen= t=20 function for trading. At a time when supply barely meets or falls short of= =20 demand he noted companies with electricity to sell have to worry only abo= ut=20 how high to set their price.=20 The trader is a pawn in the generator's game to drive up prices said Dun= n.=20 Trading develops a level of trust. You my alleged competitor will bid in= =20 the same patterns and I will respond not in a competitive pattern but in a= =20 complimentary pattern.=20 The state senator said his investigation found evidence that on several day= s=20 energy companies appeared to test their ability to drive prices up without= =20 being undercut by competitors.=20 This ability to drive up prices without competitive consequence is a key te= st=20 of market power the technical term for manipulation or price fixing.=20 But Dunn also conceded that antitrust violations can be hard to prove in=20 court. He suggested that even if the trading behavior falls short of=20 antitrust violations it remains anti-competitive and devastating for the= =20 California economy.=20 To Harry Trebing a utility industry expert and professor emeritus at=20 Michigan State University wholesale electricity trading is reminiscent of= =20 what took place in the 1920s and early '30s. Back then utility companies= =20 created complex networks of holding companies that traded stock among=20 themselves driving up prices in the process.=20 Undoing that scheme was a focus of President Franklin Roosevelt's=20 administration. Congress ended up barring national power companies and=20 tightening regulation of utilities in an effort to counteract their tenden= cy=20 to create markets that work only for insiders.=20 The broad goals of trading are the same Trebing said.=20 The goal is to maximize profits through raising prices.=20 Daily energy costs for state fall in past weeks=20 By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 SACRAMENTO -- In some of the first good news of the electricity crisis the= =20 Davis administration said yesterday that the daily cost of power purchased = by=20 the state for utility customers has dropped in recent weeks.=20 The price-drop news comes after an announcement that Californians conserved= =20 more energy than expected last month 11 percent and amid Davis=20 administration optimism that the Legislature may finally begin to move on a= =20 plan to keep Southern California Edison out of bankruptcy.=20 The developments if they turn out to be a trend and not temporary could b= e=20 among the first signs that Gov. Gray Davis' plan to end the electricity=20 crisis is beginning to work. But the administration isn't saying that.=20 We have had a few good days here lately said S. David Freeman a Davis= =20 power adviser. I don't think that I want to project.=20 Some power-market watchers began to speculate last month that prices may ha= ve=20 peaked earlier this year. Platts an energy information service said=20 yesterday that spot prices for the natural gas used by power plants are=20 falling this month.=20 The governor's press secretary Steve Maviglio told reporters yesterday th= at=20 the daily amount spent on power is now well below $50 million which was= =20 the average cost earlier this year.=20 A 12-day gap in the most recent notice to the Legislature that another $500= =20 million increment will be spent on power suggests that the daily average=20 during the last two weeks may have dropped down around $42 million.=20 Oscar Hidalgo a spokesman for the state power purchasing agency said that= =20 the average cost of power was under $40 million during the first four days = of=20 this month.=20 Maviglio attributed the lower cost to conservation the phasing in of cheap= er=20 long-term power contracts fewer power plants off-line for maintenance and= =20 cooler weather.=20 However he said The average cost is still way over what we paid last=20 year.=20 There was widespread skepticism in late April when the governor's consultan= ts=20 predicted that the $346 per megawatt-hour average paid by the state for=20 non-contracted power from April through June would drop to an average of $1= 95=20 from July through September.=20 We are still very comfortable with the projection that Mr. Fichera and=20 company estimated Maviglio said referring to Joseph Fichera of Saber=20 Partners in New York.=20 During a briefing on May 21 Fichera told reporters that the amount of powe= r=20 that the state would obtain under long-term contracts for May was expected = to=20 be about 43 percent of the total required the so-called net short.=20 Fichera said contracts already signed were expected to cover 66 percent of= =20 the net short in June 48 percent in July and 42 percent in August. He sai= d=20 contracts that had been agreed on in principle could increase those amounts= =20 to 73 percent in June 67 percent in July and 60 percent in August.=20 We are still on target. There are risks Fichera said yesterday among th= em=20 extended hot weather and power plant outages. No one is popping the=20 champagne corks until Sept. 30.=20 The governor's consultants based their forecast of power demand this summer= =20 on an estimate that Californians will reduce their electricity use by 7=20 percent.=20 The 11 percent reduction last month as compared to May of last year came= =20 before the sticker shock of rate hikes that begin this month for customers = of=20 Edison and Pacific Gas and Electric. And a $35 million ad campaign urging= =20 conservation has not hit full stride.=20 Maviglio said the administration plans to release some detailed information= =20 on Monday about the roughly $8 billion the state has spent buying power. Th= e=20 general fund will be repaid by a bond of up to $13.4 billion that ratepayer= s=20 will pay off over 15 years.=20 Legislative leaders have demanded detailed information about power purchase= s=20 before proceeding with the Edison plan. Assembly Democrats are working on a= =20 plan that de-emphasizes state purchase of the Edison transmission system an= d=20 would put most of the burden for paying off Edison's debt on businesses and= =20 large users not residences. Five tiers sought in proposed rate boost=20 Conservation would be promoted SDG&E says By Karen Kucher=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 A proposed rate increase for SDG&E customers to cover the high cost of=20 electricity should be imposed in five tiers to encourage conservation the= =20 company is advising state utility regulators.=20 The more electricity a customer uses the higher the rate would be.=20 SDG&E needs to raise its rates to bring in an additional $502 million=20 annually to pay the state for power purchases.=20 The state Public Utilities Commission is expected to rule on San Diego Gas = &=20 Electric's rate-increase proposal June 28.=20 The rate changes would remove a cap that has shielded most SDG&E customers= =20 from rising electricity prices for a year. The cap enacted by state=20 lawmakers in September 2000 and retroactive to June 2000 set rates at 6.5= =20 cents per kilowatt-hour.=20 Higher rates would mean the average SDG&E residential and small-business=20 customer's electricity bills would go up by 18 percent. Large commercial=20 users' bills would average 29 percent more.=20 Public hearings on the issue will be held next Monday and Tuesday in San=20 Diego El Cajon Escondido and San Clemente. These sessions will focus on= =20 small-business and residential consumers. Hearings on large commercial user= s=20 were held last month.=20 Earlier this year the PUC decided to allow the state's two largest=20 utilities Pacific Gas and Electric and Southern California Edison to char= ge=20 customers an extra $5.7 billion annually for electricity.=20 The state Department of Water Resources which has been buying power for=20 SDG&E customers since February asked SDG&E to generate a total of $915=20 million annually to cover the cost of electricity purchases.=20 With the proposed rate increases SDG&E could do that.=20 Large commercial customers would pay about 30 percent of the overall increa= se=20 and residential and small-business customers would pay about 70 percent sa= id=20 Ed Van Herik a spokesman for the utility company.=20 If the increase can be tiered as many as 60 percent of residential custome= rs=20 will see no rate increase if their electricity usage remains the same Van= =20 Herik said.=20 But customers who use more than 130 percent of their baseline -- considered= =20 the minimum amount of electricity needed by a household -- will be billed a= t=20 increasingly higher rates.=20 Residential and small-business customers who use a lot of electricity could= =20 pay as much as 17.89 cents per kilowatt hour for some power they consume.= =20 Consumer advocate Michael Shames said he is concerned the utility's proposa= l=20 does not spread the increases evenly among different types of users. He als= o=20 called for more scrutiny of the state's request.=20 People should tell PUC officials that this increase should not be a carte= =20 blanche or blank check approval said Shames the head of Utility Consumer= s'=20 Action Network. The PUC needs to ensure that the rate increase requested b= y=20 the (state) is reasonable.=20 The public hearings are scheduled for:=20 ?Monday 1 p.m. San Diego Concourse Copper Room 200 C St. San Diego.=20 ?Monday 7 p.m. El Cajon Community Center 195 E. Douglas Ave. El Cajon.= =20 ?Tuesday 1 p.m. Country Inn Hotel 35 Via Pico Plaza San Clemente.=20 ?Tuesday 7 p.m. Center for the Arts 340 N. Escondido Blvd. Escondido.= =20 Port budget large but power bills loom=20 Slowing economy also cause for worry By Ronald W. Powell=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 The rock is rolling financially but there are indications that the blues= =20 lurk on the horizon.=20 Officials of the San Diego Unified Port District -- headquartered in a=20 block-shaped building some employees call the rock -- are happy with a=20 projected 2001-2002 budget that is 5.1 percent larger than the current one.= =20 Total revenue is expected to reach $208.7 million $10.2 million above what= =20 is expected in the fiscal year that ends June 30.=20 Port commissioners gave preliminary approval to the budget yesterday and ar= e=20 scheduled to take a final vote July 10.=20 But a slowing economy and surging electric bills are causes for concern.=20 Electricity costs are expected to rise from $5 million to $8.2 million in t= he=20 coming fiscal year.=20 As far as trends we see a continuation of the growth we've experienced ov= er=20 the past five years said Bruce Hollingsworth the port's treasurer. But= =20 our percentage of growth will not rise as sharply.=20 Port revenues have grown steadily since the 1997-1998 fiscal year when $16= 3=20 million was generated.=20 The proposed budget calls for adding 24 employees to the port's 730-member= =20 work force. New hires will include three Harbor Police officers 10 employe= es=20 in the aviation division and four in maritime services.=20 The port operates Lindbergh Field and administers nonmilitary tidelands alo= ng=20 San Diego Bay. It is landlord to more than 600 waterfront businesses and=20 operates two marine cargo terminals and one cruise ship terminal.=20 The budget calls for growth in each of the port's primary revenue centers:= =20 aviation real estate and maritime services.=20 Passenger and cargo activity at Lindbergh Field is expected to generate $90= .7=20 million or $5 million more than expected in the current year. Most of that= =20 increase is expected to come from parking-rate increases at the airport and= =20 at the port's long-term parking lot on Pacific Highway.=20 Rent from hotels and other businesses that are port tenants are expected to= =20 total $63.1 million up $1.8 million from the current budget.=20 Increases in cargo and cruise ship traffic are expected to boost maritime= =20 income by $2.7 million to a total of $18.4 million.=20 The port expects to spend $157 million on construction projects. They inclu= de=20 $8.5 million to relocate the General Services Department from Eighth Avenue= =20 and Harbor Drive in San Diego to National City and more than $5 million for= =20 paving and improvements at the 10th Avenue Marine Terminal.=20 Rent revenue could grow substantially in future years. Four hotel projects = on=20 port property have won approval or are seeking it.=20 Jim Bailey president of Manchester Resorts told commissioners yesterday= =20 that he expects to break ground on a second Hyatt tower of 750 rooms by Jun= e=20 26. Port officials said revenue from that hotel would bring in an additiona= l=20 $3.7 million a year. It is scheduled to open in the summer of 2003.=20 Hollingsworth the treasurer said that if all four hotels are built the po= rt=20 could receive as much as $15 million a year in new revenue.=20 Continuous use urged for planned power plant=20 Escondido facility originally proposed for peak demand By Jonathan Heller=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 ESCONDIDO -- A proposed power plant in southwest Escondido that initially w= as=20 expected to run only during times of peak electricity demand probably will = be=20 allowed to run full time.=20 A state energy official who recommended approval of the plant yesterday has= =20 said the plant could operate as often as the state deems necessary.=20 The California Energy Commission was scheduled to vote on the project today= .=20 CalPeak Power of San Diego has asked the commission to approve a 49-megawat= t=20 plant on Enterprise Street near Vineyard Avenue. Referred to as a peaker= =20 plant such facilities typically are designed to supply energy only during= =20 times of peak demand.=20 The state limits the number of hours some plants can operate to keep=20 pollution at a minimum. A 44-megawatt peaker plant being built on West=20 Mission Avenue in Escondido by Ramco Inc. will be allowed to operate no mor= e=20 than 16 hours per day.=20 That plant is permitted to emit up to 5 parts per million of nitrogen oxide= =20 although its actual emissions are expected to be slightly lower said Dale= =20 Mesple a Ramco consultant. Nitrogen oxide is a component of smog.=20 The CalPeak plant if approved would be restricted to 2 parts per million = of=20 nitrogen oxide.=20 It was generally assumed that the CalPeak plant would operate under similar= =20 time restrictions as the Ramco plant. The potential for air pollution was= =20 among the chief concerns of residents who spoke at the City Council hearing= s=20 on the Ramco project and at the energy commission hearings about the CalPea= k=20 plant.=20 But under the terms of approval recommended by Energy Commission Chairman= =20 William Keese CalPeak's plant would be able to operate up to 8760 hours= =20 per year typically when the demand for electricity is high. That number= =20 equals 24 hours a day.=20 The actual number of hours would depend on the requirements of the state's= =20 Independent System Operator which manages the energy grid.=20 We certainly want to have the flexibility to run whenever we're needed= =20 said Mark Lyons CalPeak's development director. Exactly how often we will= =20 run is anybody's guess.=20 Escondido Councilwoman June Rady said she was frustrated by the possibility= =20 of the plant running full time. In Ramco's case the city and the county Ai= r=20 Pollution Control District made it clear how often the plant could operate.= =20 CalPeak chose to bypass the city's permitting process and went through the= =20 state Energy Commission which offers an expedited 21-day approval put in= =20 place by Gov. Gray Davis as an emergency measure.=20 I think Escondido has been absolutely ignored and there's a total lack of= =20 due process Rady said. It boils down to an issue of local control.=20 Although city officials objected to the commission pre-empting the city's= =20 land-use authority the commission maintained that Davis' order gave it the= =20 final say on this type of project.=20 If the commission gives final approval today the only remedy available to= =20 the city would be in court. At least three council members must vote to=20 initiate legal action.=20 Keese's recommended approval did take into account several city concerns=20 regarding landscaping. The CalPeak plant would be built near the entrance o= f=20 a planned high-tech business park and city officials were worried the=20 plant's appearance might hinder the ability to attract high-quality tenants= =20 to the park.=20 Mayor Lori Holt Pfeiler said she was not surprised by the commission's=20 recommendation.=20 I expected they would want to approve the project and that's why it was= =20 important for the city to weigh in with conditions we have in this=20 community Pfeiler said.=20 Rising energy prices threaten Poway troupe=20 By Brian E. Clark=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 POWAY -- Rising electricity rates may extinguish the stage lights this summ= er=20 for the Poway Performing Arts Company.=20 I'm afraid that if SDG&E gets the price increase it's asking for -- from 6= .5=20 cents per kilowatt-hour to 8.9 cents -- that we'll go under said Kathy=20 McCafferty spokeswoman for the nonprofit theater.=20 The volunteer organization produces its plays in a building at a Poway Road= =20 shopping center. It held three fund-raising performances over the weekend= =20 but officials were uncertain yesterday how much money was raised.=20 The group is not affiliated with the Poway Performing Arts Center and has= =20 been in business for 20 years.=20 McCafferty said the group built up a $2000 surplus last summer before ener= gy=20 prices began to surge.=20 That $2000 was a big reserve for us she said. It seemed like a ton of= =20 money but boy it went fast. And we're really energy-dependent. Our light= s=20 use a lot of power. And we're in Poway on the second floor of our building.= =20 It gets hot here and we have to use air conditioning.=20 But McCafferty acknowledged that the cost of power isn't the group's only= =20 problem.=20 In a recent letter to backers President Nan Katona said the organization= =20 also needs new blood to keep operating.=20 The truth is that lack of funding is just a symptom of the deeper problem= =20 which is lack of community support she wrote. Ironically audiences and= =20 reviewers recognize the Poway Performing Arts Company as one of the premier= =20 community arts theaters in San Diego.=20 Katona said some new volunteers had stepped forward to take leadership role= s=20 in the theater company since she wrote her letter last month. But she said= =20 rising electricity prices could still bring the group down.=20 If our energy bills double or triple we could be in dire straits she=20 said. It could push us over the edge financially.=20 McCafferty said it would be difficult for the theater to cut costs.=20 We can't run a much leaner operation she said. If our power prices go u= p=20 again we may still be forced out of business.=20 The theater is at 13250 Poway Road in the Lively Shopping Center. For more= =20 information call (858) 679-8085.=20 Fair to use generators for midway attractions=20 By Michael Burge=20 UNION-TRIBUNE STAFF WRITER=20 June 6 2001=20 DEL MAR -- The Del Mar Fair will generate its own electricity for thrill=20 rides on the midway this year instead of using energy from SDG&E.=20 In case there are planned or unplanned outages we still will be operating= =20 fairgrounds General Manager Timothy J. Fennell said.=20 Fennell decided to put the midway on generators because he didn't want the= =20 fairgrounds pulling power from the grid while county residents are coping= =20 with rolling blackouts at home and at work he said.=20 And the fair does not want to take a chance that a rolling blackout will=20 leave some people stranded in rides high above the grounds forcing an=20 evacuation.=20 The fairgrounds has been told it is exempt from rolling blackouts but rath= er=20 than take such a risk it will rent 13 diesel-fuel generators and produce=20 electricity on the midway. The rest of the fairgrounds will use power from= =20 San Diego Gas & Electric Co.=20 Fairgrounds operations manager Larry Baumann estimated it would cost the=20 fairgrounds $20000 more to generate its own electricity than to buy it fro= m=20 SDG&E.=20 Midway manager Donna Ruhm said it will be worth it.=20 Rides that require evacuation have to have backup power and they do Ruhm= =20 said. Now our service won't be interrupted.=20 It is not unusual for carnivals to generate their own power and the=20 fairgrounds has done so in the past. Fair officials removed the generators = 10=20 to 15 years ago to reduce noise on the midway.=20 The fair opens June 15 and ends July 4.=20 While the rest of the fairgrounds is on the SDG&E grid Baumann said backup= =20 generators can kick in during a typical 60-or 90-minute blackout allowing= =20 the fair to operate without serious difficulty. Those generators are not=20 linked to the midway.=20 All the generators are licensed by the state and meet emission standards= =20 fair officials said so they do not expect the noise and odor to be=20 excessive.=20 The fairgrounds is taking the precaution of providing its own power despite= =20 the fact that it probably will not go dark during a rolling blackout.=20 SDG&E has assured me that .?.?. the fairgrounds and the racetrack will not= =20 be on the curtailment (blackout) list during the fair and the races said= =20 Del Mar Fire Chief Jack Gosney.=20 The Del Mar Thoroughbred racing season begins July 18 and ends Sept. 5.=20 Gosney said SDG&E told him earlier this year that the fairgrounds was not= =20 subject to a forced outage because it shared a circuit with the Del Mar Fir= e=20 Station which is a 911 dispatch center and exempt from a blackout. But he= =20 said recent research showed that the fairgrounds is on a separate circuit.= =20 Nonetheless Gosney said SDG&E is exempting the fairgrounds and racetrack= =20 during the busy summer season.=20 The fairgrounds paid $137152.95 for its electricity usage from March 12 to= =20 April 10. It paid $51845.39 for electricity during the same period last ye= ar. ?=20 Wednesday June 6 2001=20 'Hi My Name Isn't Justice Honey' and Shame on Lockyer=20 By TOM G. PALMER ?????Here's what California Atty. Gen. Bill Lockyer said at a press=20 conference about Enron Corp. Chairman Kenneth Lay: I would love to=20 personally escort Lay to an 8-by-10 cell that he could share with a tattooe= d=20 dude who says 'Hi my name is Spike honey.'=20 ?????Here's why Lockyer should be removed from his office of public trust:= =20 First because as the chief law enforcement officer of the largest state in= =20 the nation he not only has admitted that rape is a regular feature of the= =20 state's prison system but also that he considers rape a part of the=20 punishment he can inflict on others.=20 ?????Second because he has publicly stated that he would like to personall= y=20 arrange the rape of a Texas businessman who has not even been charged with= =20 any illegal behavior.=20 ?????Lockyer's remarks reveal him to be an authoritarian thug someone whol= ly=20 unsuited to holding an office of public trust.=20 ?????But his remarks do have one positive merit: They tell us what criminal= =20 penalties really entail.=20 ?????Contrary to some depictions of prisons as country clubs they are=20 violent and terrible places. More and more politicians propose criminal=20 sanctions for more and more alleged misdeeds and as a result ever more kin= ds=20 of behavior are sanctioned by criminal penalties perhaps now even selling= =20 electricity. Those found guilty of such crimes are put into cages where th= ey=20 are deprived of their liberty and dignity and as Lockyer so clearly=20 acknowledged raped and brutalized. What's worse Lockyer has indicated tha= t=20 he believes that rape is an appropriate part of the system of punishments h= e=20 administers.=20 ?????Should it matter that Lay is a businessman? Imagine the outcry if the= =20 head of Enron were female. What would Lockyer's fellow Democrats have said = to=20 that?=20 ?????Should it matter that Lay is chairman of an electricity generator? Doe= s=20 the nature of his business justify threats to escort him to his own rape?= =20 Lockyer told the Los Angeles Times that he had singled out Enron's chairman= =20 because the Houston-based company is the world's largest energy trader.=20 ?????So apparently singling out a man for a heinous threat is OK because he= 's=20 the chairman of the world's largest energy trading company. That's accordin= g=20 to the man who as a state senator sponsored California's 1984 hate-crimes= =20 law. Evidently the crusader against intimidation on the basis of race=20 religion and sexual orientation feels no hesitation at all about intimidati= ng=20 someone and threatening him with the brutal use of physical force simply=20 because he heads the world's largest energy trading company.=20 ?????Lockyer and Gov. Gray Davis seem to think that the best way to keep th= e=20 lights on is to threaten electricity producers with brute force rather tha= n=20 to offer to pay competitive rates in competitive markets. Are energy=20 producers to blame for California's energy problems? No. Bad policies=20 including rigid controls on retail prices of electricity are the cause of= =20 the problem not the people who generate energy. Scapegoating producers and= =20 threatening them with violence is an old ploy of authoritarians. California= ns=20 should not stand for it.=20 ?????An Enron spokesman said that Lockyer's chilling stated desire to arran= ge=20 the rape of Lay does not merit a response. The spokesman is wrong. Lockyer'= s=20 remarks merit public disgrace and removal from office. After all rape is n= ot=20 a form of legal justice in America--is it?=20 - - - Tom G. Palmer Is a Senior Fellow at the Cato Institute in Washington. E-mai= l:=20 Palmert@cato.org Copyright 2001 Los Angeles Times=20 California Metro Desk=20 U.S. Probes Alleged Pact Not to Build New Plants Power: Justice officials= =20 focus on Southland operations of two firms which deny wrongdoing. MYRON LEVIN NANCY RIVERA BROOKS ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 The U.S. Department of Justice has launched an investigation into whether t= wo=20 companies that control a large swath of Southern California 's electricity= =20 supply agreed to limit power plant construction potentially hindering=20 crucial energy production according to federal records and interviews.=20 The civil antitrust probe of Williams Energy Services and AES Southland=20 represents the Justice Department's first foray into the activities of ener= gy=20 suppliers who have reaped huge profits in California 's price-shocked marke= t.=20 AES disclosed the investigation which began last month in a filing with t= he=20 Securities and Exchange Commission on Tuesday. In its papers AES said the= =20 Justice Department is focusing on whether its agreement with Williams could= =20 constrain future power plant construction in Southern California .=20 The investigation comes at a time when the state is scrambling to get new= =20 generators built and running to avoid blackouts and economic problems.=20 The government alleges that AES and Williams agreed to limit the expansion = or=20 construction of new power plants near three facilities purchased by AES in= =20 1998 from Southern California Edison under the state's new deregulation pla= n.=20 The plants--in Long Beach Huntington Beach and Redondo Beach--are owned by= =20 AES but the electricity is sold by Williams. Under a 3-year-old deal know= n=20 as a tolling agreement Williams essentially rents out the capacity of the= =20 plants for annual payments to AES. Williams supplies natural gas to fire th= e=20 plants and sells the electricity under long-term contracts and in the costl= y=20 spot market.=20 Williams and AES have similar tolling agreements at plants in Pennsylvania= =20 and New Jersey. However AES spokesman Aaron Thomas said the Justice=20 Department's investigative requests have focused only on agreements between= =20 Williams and AES in Southern California .=20 Thomas would say only that the agreement at the center of the investigation= =20 is simply a delineation of how expansion or repowerings are done at the=20 facilities.=20 The three plants have a combined capacity of more than 3900 megawatts=20 enough to supply about 3 million homes. This summer AES is bringing anothe= r=20 450 megawatts on line by reactivating two mothballed generators in Huntingt= on=20 Beach.=20 Paula Hall-Collins a spokeswoman for Tulsa-based Williams Cos. said she= =20 believes that the investigation is unrelated to a recent inquiry by the=20 Federal Energy Regulatory Commission into whether AES and Williams=20 unnecessarily shut down plants to jack up prices. A portion of that=20 investigation was settled in April when Williams without admitting any=20 wrongdoing agreed to pay about $8 million.=20 We've always maintained that we've operated within the law and we're=20 certain the investigation by the DOJ will find we are operating legally= =20 Hall-Collins said.=20 Williams and AES are among the power plant owners and marketers that have= =20 been lambasted by Gov. Gray Davis because of gold-plated electricity prices= =20 that have pushed the state's biggest utilities to the edge of ruin and are= =20 steadily draining the state's budget surplus.=20 State officials are asking FERC to revoke the rights of AES and Williams to= =20 sell electricity at whatever price the market will bear. That right was=20 granted for three years beginning in 1998 by federal regulators when=20 California 's $28-billion electricity market was opened to competition.=20 Under that plan the rights of AES and Williams to sell into the market are= =20 the first to come up for renewal.=20 AES Southland and Williams Energy Services are both arms of large energy=20 companies--AES Corp. of Arlington Va. and Williams Cos. of Tulsa Okla. California Metro Desk=20 Natural Gas Power Prices Drop Sharply Energy: More conservation mild=20 weather are among factors keeping costs down experts say. RICARDO ALONSO-ZALDIVAR NANCY VOGEL ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-1=20 Copyright 2001 / The Times Mirror Company=20 WASHINGTON -- The wholesale prices of electricity and natural gas in=20 California have fallen sharply in recent weeks and experts said Tuesday th= at=20 the relief could be the harbinger of an energy turnaround.=20 Or it may be just a blip.=20 In the last couple of weeks California power prices have plunged to the=20 lowest levels since April 2000 traders say with electricity selling on so= me=20 days for less than $100 per megawatt-hour.=20 At night when demand slackens power sometimes sells for less than $20 per= =20 megawatt-hour. That is reminiscent of the days before prices went haywire= =20 last summer.=20 It is a drastically different scenario than the $500 to $800 the state paid= =20 during a spate of hot weather last month.=20 Meanwhile wholesale natural gas prices at a bellwether pipeline junction o= n=20 the Southern California -Arizona border dipped last week to their lowest=20 levels since November according to a publication that tracks the industry.= =20 Separately Southern California Gas Co. and Pacific Gas & Electric Co.=20 reported June rate cuts for their residential gas customers of 16% and 38%= =20 respectively.=20 Experts credited a combination of conservation mild weather a burst of=20 increased hydroelectric generation and lower natural gas prices for the dro= p=20 in electricity costs.=20 Conservation is starting to worry the generators which is nice to see= =20 said Severin Borenstein director of the University of California Energy=20 Institute in Berkeley. Californians used 11% less energy last month than in= =20 May 2000 according to the state Energy Commission.=20 I'm worried that if we don't push harder on conservation [prices] won't= =20 stay down Borenstein added.=20 On the natural gas side experts said the price decline is due to replenish= ed=20 storage within California a nationwide drop in the cost of the fuel and= =20 easing demand from power plants.=20 The number of shippers competing to get natural gas to the state has also= =20 increased with the expiration of a controversial contract on the El Paso= =20 pipeline system last week.=20 But economists were reluctant to make sweeping predictions based on the=20 latest indicators.=20 It's hard to draw specific conclusions said Bruce Henning who tracks th= e=20 natural gas markets for Energy and Environmental Analysis Inc. an Arlingto= n=20 Va. consulting firm.=20 How the summer turns out depends on the weather in the state Henning said= =20 adding The weather represents the balance in the Southern California=20 market.=20 Natural gas fuels most California power plants. With wholesale prices=20 recently averaging three to four times the rates charged elsewhere in the= =20 country state and federal officials have despaired of chances for=20 controlling electricity costs.=20 Last Friday however the daily price for immediate delivery of natural gas= =20 in Topock Ariz. a pipeline junction near the California border dipped to= =20 $7.85 per million British thermal units.=20 According to Natural Gas Week it was the first time since mid-November tha= t=20 the price at that location had fallen below $8 per million BTUs. One millio= n=20 BTUs is what a typical Southern California home uses in five or six days.= =20 Considered a bellwether for other pipeline systems serving California the= =20 Topock price reached a record $56.54 per million BTUs on Dec. 8. It stood a= t=20 $9.36 per million BTUs at the close of business Tuesday still below recent= =20 weekly averages.=20 Other industry publications have also picked up signals of price declines.= =20 Platts the energy information division of McGraw-Hill Cos. reported Tuesd= ay=20 that the price for monthly gas delivery contracts to California fell 22% in= =20 June following a nationwide trend.=20 But Henning said the drop in California prices is attributable to both lowe= r=20 prices around the country and a decline in the high markups for shipping ga= s=20 to California . Those markups which far exceed the cost of transporting ga= s=20 have drawn the attention of state and federal investigators.=20 Henning said the markups are declining as depleted storage levels in=20 California are replenished. Storage levels have been filling very rapidly= =20 and that fact is reflected in prices coming down he said.=20 The link between natural gas and electricity prices is a hotly debated=20 subject. Some experts say high-priced natural gas is driving up the cost of= =20 electricity . Others believe that record prices for power are raising the= =20 prices that generators are willing to pay for their fuel.=20 Electricity prices that range from $20 to $200 per megawatt-hour--instead o= f=20 the $150 to $500 per megawatt-hour paid in recent months--are great news fo= r=20 Gov. Gray Davis.=20 Average daily power prices in California for transactions through the=20 Automated Power Exchange have dropped from $149 per megawatt-hour last Frid= ay=20 to $110 per megawatt-hour Tuesday. The exchange is a private company that= =20 brings together electricity buyers and sellers and accounts for less than 1= 0%=20 of the state's market.=20 Davis spokesman Steve Maviglio said Tuesday that average daily power=20 purchases by the state have recently dipped below $50 million.=20 The state has sometimes had to pay more than $100 million a day since it=20 started buying power in January through the Department of Water Resources.= =20 The state stepped in because California 's two biggest utilities became too= =20 financially crippled to withstand the prices being charged by generators.= =20 Davis' plan to pay for past and future energy purchases with a $12.4-billio= n=20 bond issue hinges on an assumption that power prices will be driven down th= is=20 summer through long-term contracts conservation and the construction of ne= w=20 power plants.=20 UC Berkeley's Borenstein said conservation efforts have not gone far enough= .=20 You walk into most buildings and you still need a sweater he said. That= =20 ain't the way to hit the target.=20 If Californians conserved an additional 10% off their peak usage on hot=20 afternoons he said we could really break the backs of the generators we= =20 could really collapse the price.=20 Prices tend to skyrocket in California 's electricity market on hot=20 afternoons when demand soars and grid operators must scramble to purchase= =20 enough electricity . Cool weather which reduces demand for air conditionin= g=20 and conservation help keep the state from reaching such crisis situations.= =20 Borenstein said he believes generators are also asking less money for their= =20 electricity in part because of a federal order that took effect last month.= =20 The order limits the price power plant owners can charge when California 's= =20 supplies are strained.=20 Power sellers say there are more fundamental forces at work.=20 There's more supply relative to demand which is softening prices said= =20 Gary Ackerman executive director of the Western Power Trading Forum. The= =20 market is working and it's providing cheaper wholesale power more quickly= =20 than any regulatory scheme could ever do.=20 *=20 Times staff writer Dan Morain in Sacramento contributed to this story.=20 RELATED STORY=20 PG&E wins: The utility averted a $1-billion bill for power buys. B6=20 (BEGIN TEXT OF INFOBOX / INFOGRAPHIC)=20 A Blip or a Trend?=20 Daily natural gas prices at the California border with Arizona--considered = a=20 bellwether of the state's costs--have been declining in the last two weeks.= =20 *=20 Natural gas price per 1 million Btu=20 $9.36=20 Source: Natural Gas Week California Metro Desk=20 The State Utility Averts $1 Billion in Costs Courts: PG&E and Cal-ISO agree= =20 to recognize Department of Water Resources as purchaser of the power. TIM REITERMAN ?=20 06/06/2001=20 Los Angeles Times=20 Home Edition=20 Page B-6=20 Copyright 2001 / The Times Mirror Company=20 SAN FRANCISCO -- Pacific Gas & Electric Co. and the state's power grid=20 operator reached an agreement Tuesday that insulated PG&E at least=20 temporarily from more than $1 billion in power purchases the state made for= =20 its customers.=20 The California Independent System Operator sent $1.26 billion in invoices t= o=20 the utility for power purchases by the state Department of Water Resources= =20 for PG&E customers from January through March.=20 But the utility contended in Bankruptcy Court proceedings that it was not= =20 liable for such purchases and that continued purchases would cause annual= =20 losses of $4 billion.=20 After arguments before Judge Dennis Montali PG&E and Cal-ISO agreed that t= he=20 Department of Water Resources not PG&E purchased the power. Cal-ISO had= =20 argued that it was making the purchases on PG&E's behalf.=20 PG&E wants to be a utility and have obligations to serve customers but th= ey=20 don't want to pay for it Cal-ISO general counsel Charles Robinson said=20 later.=20 If PG&E refuses to pay the invoices Robinson said Cal-ISO will send the= =20 bills to the Department of Water Resources and officials there can decide= =20 whether to pursue claims in Bankruptcy Court. A spokesman for department= =20 which has authorization to sell $13 billion in bonds for power purchases= =20 said the agency will have no comment until the matter can be studied.=20 State agencies have stayed out of the bankruptcy proceedings hoping to=20 preserve their immunity from suits in federal court.=20 The agreement will be submitted for Montali's approval Monday but the judg= e=20 said it would not be binding on the department because no one represented t= he=20 agency in court.=20 PG&E's own production and contracts provide the majority of the power for i= ts=20 customers. But state legislation adopted this year allows the department to= =20 secure power contracts to serve customers of ailing utilities. When a=20 shortage threatens the power grid the department purchases additional powe= r=20 through Cal-ISO on the spot electricity market.=20 PG&E filed for Chapter 11 protection from creditors on April 6 saying it w= as=20 $9 billion in debt.=20 Dramatic drop in cost of electricity=20 LOWER BILLS: Cheaper fuel milder weather credited=20 David Lazarus Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 California electricity prices have plunged unexpectedly to their lowest lev= el=20 in more than a year partly as the result of a simultaneous drop in prices= =20 for natural gas which fuels most power plants.=20 Make no mistake: Gas and electricity prices could surge upward again in=20 months ahead.=20 But for the first time since California's energy markets went haywire last= =20 summer industry experts are beginning to ask whether the state finally may= =20 have turned a corner in its battle with runaway power costs.=20 California is not yet out of the woods said Kelley Doolan who tracks=20 natural gas prices for energy market researcher Platts. But this is a very= =20 significant decrease in costs.=20 Along with lower gas prices the decline in electricity costs was attribute= d=20 by state and industry officials to milder weather which reduces demand for= =20 power. They also credited recent conservation efforts by consumers and=20 better-than-expected runoff at dams for hydroelectric plants.=20 Gary Ackerman executive director of the Western Power Trading Forum an=20 energy-industry association said these factors came together to produce th= e=20 lowest wholesale electricity prices since April 2000.=20 Electricity on the spot market could have been purchased yesterday for as= =20 little as $50 per megawatt hour he noted compared with more than $500=20 earlier this year.=20 If the weather stays this way we could have reasonable prices all summer= =20 Ackerman said. We may also have fewer blackouts.=20 It is tempting for Californians to be suspicious of virtually any swing in= =20 energy prices. If power companies manipulated prices on the way up as=20 critics have alleged might they not be up to some trick as prices head in= =20 the opposite direction?=20 Nettie Hoge executive director of The Utility Reform Network in San=20 Francisco speculated that generators are allowing electricity prices to fa= ll=20 so they can discourage federal regulators from taking a more active role in= =20 the dysfunctional California market.=20 They're trying to take the heat off she said.=20 Others cautioned that the lower prices may be nothing more than a statistic= al=20 blip.=20 This was just one month's decline said Michael Shames executive directo= r=20 of the Utility Consumers' Action Network in San Diego. We really have to s= ee=20 how this plays out in the future.=20 Steve Maviglio a spokesman for Gov. Gray Davis said the governor was very= =20 encouraged by the lower energy prices. Davis announced Sunday that=20 California's power use was down 11 percent last month from a year before.= =20 We're not there yet Maviglio said of whether an end to the state's power= =20 woes is in sight. But the trend is pointing in the right direction.=20 WHITE ELEPHANT Yet this sudden drop in energy prices does have a dark side: California cou= ld=20 end up with a huge white elephant after spending about $40 billion in publi= c=20 funds on long-term power contracts.=20 The logic behind the contracts which are at an average price of $69 per=20 megawatt hour over 10 years is that the state expected to pay below-market= =20 rates for electricity for a number of years before prices came down and=20 California found itself paying above-market rates.=20 If current trends continue though California will find itself paying=20 consistently above-market rates much sooner than expected making the long-= =20 term contracts a sweet deal for the same power companies that profited so= =20 handsomely during the state's darkest hours.=20 The contracts look really ugly right now said Shames at the Utility=20 Consumers' Action Network. They may be way overpriced.=20 Maviglio the governor's spokesman said it is too early to conclude that t= he=20 state did poorly negotiating dozens of long-term power contracts.=20 No one has a crystal ball on this he said.=20 CUSTOMERS' BILLS TO DROP In any case Pacific Gas and Electric Co. said yesterday that customers'=20 average gas bills will drop 26 percent this month to $26 and should stay ne= ar=20 that level all summer.=20 Platts which monitors average monthly spot prices found that the wholesal= e=20 price of gas at the California-Oregon border has tumbled nearly 42 percent= =20 since the beginning of May -- from $9.98 per million British thermal units = to=20 $5.81.=20 The wholesale gas price at the California-Arizona border fell 45 percent= =20 from $11.91 to $6.50. This compares with a 25 percent monthly decline in=20 average natural gas prices nationwide.=20 However California gas prices are still about 50 percent higher than they= =20 were a year ago whereas national prices are now below year-ago levels for= =20 the first time since last spring.=20 While cooler weather nationwide helped push gas prices down overall Doolan= =20 attributed the especially steep drop in California to a commensurate surge = in=20 prices last month related to fears of a long hot summer of rolling=20 blackouts.=20 You had state officials all but promising rolling blackouts this summer = he=20 said. That created enormous demand for electricity generation.=20 What has changed is that we've had weeks of mild weather Doolan observed= .=20 The electricity generators have not come out of the woodwork buying up all= =20 the gas.=20 This allowed utilities like PG&E to beef up gas inventories which eased=20 demand and resulted in substantially lower prices he said.=20 'BACK ON TRACK'=20 We're back on track to be completely full for winter said Staci Homrig = a=20 PG&E spokeswoman. That's a very good thing.=20 Gas prices historically dip in the spring and summer and then rise again in= =20 the winter. PG&E is forecasting that customers' average gas bills could ris= e=20 to as high as $75 in December if current trends continue.=20 However the precipitous drop in gas prices in recent weeks suggests that= =20 California's unusually high costs at last may be abating.=20 Individual power companies so far are reluctant to speculate on whether the= =20 drop in gas prices will have a lasting effect on electricity costs.=20 E-mail David Lazarus at dlazarus@sfchronicle.com.=20 2001 San Francisco Chronicle ? Page?A - 1=20 San Jose council gives green light to generating plant=20 VOTE REVERSAL: Officials pressured to OK project=20 Marshall Wilson Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL: .DTL=20 In a clear sign that the political landscape has shifted because of the=20 state's power crisis the San Jose City Council gave a green light yesterda= y=20 for construction of a generating plant it had unanimously opposed in=20 November.=20 Yesterday's 10-to-1 vote came after months of mounting pressure for the cit= y=20 to reverse course and approve the controversial 600-megawatt Calpine plant = at=20 Coyote Valley.=20 That pressure -- increased by the occasional rolling blackout -- has come= =20 from nearly every corner of the state from elected officials to high-tech= =20 businesses and labor unions worried the power crisis will drain away jobs= =20 ruin the economy and lead to voter backlash over skyrocketing energy bills.= =20 Even the local branch of the NAACP and environmentalists pushed the council= =20 to approve the Calpine proposal -- despite overwhelming opposition from the= =20 plant's neighbors.=20 Council members did not hide their disdain yesterday for being forced to=20 reconsider their opposition to the so-called Metcalf Energy Center.=20 I'm holding my nose to vote for this thing said Councilwoman Linda=20 LeZotte.=20 I'm just as unhappy as everybody else Vice Mayor George Shirakawa said. = I=20 feel like no matter what happens we can't win.=20 GOVERNOR OFFERED HIS SUPPORT After the council's solid opposition in November Calpine appealed to the= =20 California Energy Commission which has the final say. The controversial=20 plant then received a huge boost in April when Gov. Gray Davis threw his=20 support behind it.=20 San Jose officials conceded yesterday that the energy commission was likely= =20 to override their opposition and grant approval within a few weeks. They sa= id=20 the commission's likely approval was stripping them of their power to decid= e=20 local land-use issues.=20 What I think has happened . . . is the governor and the Legislature at the= =20 state level have taken this out of our hands said Councilwoman Pat Dando.= =20 I don't think there's any chance at all the California Energy Commission i= s=20 going to turn down the Metcalf Energy Center Councilman Chuck Reed said.= =20 CONSTRUCTION MAY BEGIN SOON If given the go-ahead by the state Calpine could begin construction as ear= ly=20 as next month. The natural-gas fired plant would generate electricity by=20 mid-2003 company spokesman Kenneth Arbeu said.=20 At the urging of Mayor Ron Gonzales the council yesterday approved a new= =20 cooperation agreement with Calpine. The vote with Councilman Forrest=20 Williams casting the lone nay is preliminary while a final vote that is=20 scheduled for June 26.=20 Gonzales argued that the agreement did not amount to a flip-flop because it= =20 differs from what Calpine proposed in November.=20 The agreement approved by the council calls for increased monitoring of air= =20 pollution the use of treated wastewater to cool the plant which will redu= ce=20 discharges into San Francisco Bay and a $6.5 million community benefits= =20 package with the bulk going toward parkland acquisition Gonzales said.=20 This council has not changed its decision he said. What we've done is= =20 change the facility.=20 Critics incensed that the city was buckling to outside pressure vowed to= =20 change the council at the next election.=20 CONCERNS OVER HEALTH RISKS They raised concerns that boiled wastewater steam wafting over their homes= =20 from Calpine's plant could pose health risks. Jona Denz-Hamilton said more= =20 controls are needed to ensure the safety of neighbors like herself and her= =20 family and argued that new cleaner-burning technologies should be installe= d=20 at the plant.=20 It's too great of a risk she said.=20 Other critics said the state's energy woes will be solved and largely=20 forgotten by the time the plant opens in two years while the Santa Teresa= =20 neighborhood will be stuck with pollution for decades.=20 Approval seemed a given at the start of the more than three-hour hearing.= =20 Much of the afternoon's debate focused around plans to extend a pipeline fo= r=20 treated wastewater to the new plant.=20 Critics said Calpine was receiving a sweet deal by paying only $10 million = of=20 the $50 million cost of extending the pipeline. Several council members ask= ed=20 for a more detailed report into the financing plan before the final vote is= =20 taken June 26.=20 Chronicle staff writer Bill Workman contributed to this report.=20 E-mail Marshall Wilson at 2001 San Francisco Chronicle ? Page?A - 1=20 Developments in California's energy crisis=20 Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate1 053EDT0177.DTL=20 (06-06) 07:53 PDT (AP) --=20 Developments in California's energy crisis:=20 WEDNESDAY: * No power alerts Wednesday as reserves stay above 7 percent.=20 TUESDAY: * Gov. Gray Davis' administration says the state's electricity costs are=20 dropping substantially even as it asks state legislators for another=20 half-billion dollars for power purchases. That brings to $8.2 billion the= =20 amount the state is paying for electricity on behalf of three financially= =20 strapped utilities.=20 Spokesman Steve Maviglio says the cost to the state treasury has dropped in= =20 the last few weeks well below the $50 million dollars the state had been=20 paying on a typical day. He credits cooler weather conservation more powe= r=20 plants online and more long-term contracts with helping drive down the cost= .=20 * A state Senate committee agrees to issue subpoenas to eight out-of-state= =20 electricity generators demanding they hand over documents on bidding prici= ng=20 and other aspects of power sales in the state. The subpoenas would help a= =20 special Senate committee's investigation into whether the companies are=20 illegally profiteering from California's power crisis. The committee's=20 chairman says he expects the companies to resist setting the stage for a= =20 court battle.=20 * Oil giant Chevron threatens to cut gasoline production in California unle= ss=20 it is exempted from rolling blackouts. The San Francisco Chronicle says it= =20 has a copy of a letter sent Friday from Chevron chairman David O'Reilly to= =20 Davis. In the letter O'Reilly says the company will scale back gasoline=20 production at its Richmond and El Segundo plants operating those refinerie= s=20 only with power produced by generators at the sites.=20 * New U.S. Senate Majority Leader Tom Daschle D-S.D. supports Federal=20 Energy Regulatory Commission price caps. FERC must meet its obligation und= er=20 current law to ensure 'just and reasonable' prices for wholesale electricit= y=20 in the state of California. FERC has failed to meet this responsibility...= =20 Daschle says in a letter to Davis. Unless FERC acts soon Senator (Dianne)= =20 Feinstein's legislation should be taken up and passed to direct FERC to tak= e=20 action. I will support all necessary efforts to meet that goal.=20 * House Subcommittee on Energy Policy Natural Resources and Regulatory=20 Affairs Chairman Doug Ose R-Sacramento cites Electric Utility Week figure= s=20 that FERC's limited price caps helped cut California's power rates from $30= 0=20 to $108.47 per megawatt hour within an hour after taking effect last week.= =20 While he says more information is needed Ose uses the figures to tout his= =20 pending bill to impose the price caps around the clock and to all Western= =20 states.=20 * Pacific Gas & Electric Co. asks U.S. Bankruptcy Judge Dennis Montali to= =20 stop the manager of the state's power grid from buying electricity for=20 utility or charging it for any electricity bought after the utility filed f= or=20 bankruptcy on April 6. Separately the utility's creditors support its=20 request to the bankruptcy court to pay out $17.5 million in bonuses to the= =20 management team that guided the utility into bankruptcy.=20 * California Department of Water Resources reveals it is negotiating with= =20 municipal utilities to buy their surplus power. Department spokesman Oscar= =20 Hidalgo says talks began last week but no agreements are imminent.=20 * State lawmakers criticize a $3 million lobbying campaign by Southern=20 California Edison. The utility is telephoning shareholders to describe the= =20 dire consequences if the utility goes bankrupt. The call is then transferre= d=20 to the state Capitol so shareholders can implore lawmakers to support a=20 controversial plan to help the utility. Legislators and their staffers say= =20 the shareholders often are confused and scared their investments will be=20 degraded or wiped out.=20 * State Treasurer Phil Angelides joins an advocacy group for the poor in=20 urging the state's huge pension funds to use their economic power to levera= ge=20 power companies. The Pacific Institute for Community Organization says the= =20 two pension funds own at least $1.2 billion in stocks and bonds in most of= =20 the firms that sell electricity to California.=20 * The Assembly by a 69-0 vote approves a bill to spend $10 million on=20 environmental studies needed before Path 15 the inadequate transmission-li= ne=20 group between Northern and Southern California can be expanded. The bill= =20 moves to the Senate.=20 * Pacific Gas and Electric announces a decrease in natural gas prices down= =20 38 percent from May's rates and 66 percent lower than January's rates. The= =20 decline will bring the average residential gas bill to $26 when it goes int= o=20 effect June 7. Market analysts predict the rates will remain stable until= =20 December when demand is expected to increase with winter heating loads.=20 * No power alerts Tuesday as electricity reserves stay above 7 percent.=20 * Shares of Edison International closed at $10.05 down 53 cents. PG&E Corp= .=20 closed at $11.25 down 15 cents. Sempra Energy the parent company of San= =20 Diego Gas & Electric closes at $26.91 down 43 cents.=20 WHAT'S NEXT: * Davis' representatives continue negotiating with Sempra the parent compa= ny=20 of San Diego Gas and Electric Co. to buy the utility's transmission lines.= =20 THE PROBLEM: High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Edison and PG&E say they've lost nearly $14 billion since June to high=20 wholesale prices the state's electricity deregulation law bars them from=20 passing on to consumers. PG&E saying it hasn't received the help it needs= =20 from regulators or state lawmakers filed for federal bankruptcy protection= =20 April 6.=20 Electricity and natural gas suppliers scared off by the two companies' poo= r=20 credit ratings are refusing to sell to them leading the state in January = to=20 start buying power for the utilities' nearly 9 million residential and=20 business customers. The state is also buying power for a third investor-own= ed=20 utility San Diego Gas & Electric which is in better financial shape than= =20 much larger Edison and PG&E but also struggling with high wholesale power= =20 costs.=20 The Public Utilities Commission has approved average rate increases of 37= =20 percent for the heaviest residential customers and 38 percent for commercia= l=20 customers and hikes of up to 49 percent for industrial customers and 15=20 percent or 20 percent for agricultural customers to help finance the state'= s=20 multibillion-dollar power buys.=20 2001 Associated Press ?=20 California conserves=20 Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/E D86597.DTL=20 WHEN RAIN fails to fall from the sky Californians know why there is a=20 drought. But when rolling blackouts suddenly appeared in the dead of winter= =20 many of us wondered who was responsible for and who has profited from what= =20 now seems like an artificially created power shortage in the state.=20 Our skepticism proved to be right. Windfall profits were reaped by=20 electricity generators while natural gas importers extracted prices far abo= ve=20 the national average.=20 Timid federal overseers exact only wrist-slap penalties on the offending=20 energy firms. The White House scoffs at temporary controls for a=20 malfunctioning market. California's state government has ended up as the bi= ll=20 payer for the sickly utilities forking over $8 billion to generators. This= =20 number may hit $40 billion by year-end.=20 It's an infuriating tangle. All the more remarkable then that skeptical= =20 Californians have managed within two months to reduce their use of=20 electricity by 11 percent. The public's response to the governor's appeal f= or=20 energy conservation has exceeded expectations. Although many businesses hav= e=20 suffered enormous losses ordinary people have made relatively painless=20 sacrifices. People turned off their lights purchased energy-efficient=20 lightbulbs used air conditioning less and shut off their computers when no= t=20 in use.=20 Despite this remarkable civic compliance we still face an unconscionable= =20 lack of leadership. President Bush seems perfectly willing to allow Texas= =20 power companies to pummel the once-powerful California economy. He repeats = a=20 mantra about creating more supply -- which California is doing with 15 powe= r=20 plants under construction -- while ignoring the outsized sums paid to a=20 handful of energy generators.=20 At the same time Gov. Gray Davis who has given new meaning to the word=20 dithering has failed to make the tough and transparent decisions. He delay= ed=20 an inevitable rise in power rates. Davis also dragged his feet in openly=20 announcing new power contracts that commit California to billions in spendi= ng=20 over the next decade.=20 To Davis' credit he has urged California to conserve by laying out an $800= =20 million plan to cut power use and invest in energy-saving programs. The=20 message is getting out as higher rates take effect this month.=20 Despite a woefully unbalanced market and shortsighted leadership the peopl= e=20 of California have demonstrated that if there is a will there is a way.=20 Now it is time for our leaders to follow the wisdom of their constituents.= =20 2001 San Francisco Chronicle ? Page?A - 20=20 L.A. power customers awash in cheap energy=20 John Wildermuth Chronicle Staff Writer Wednesday June 6 2001=20 2001 San Francisco Chronicle=20 URL:=20 /06/M N133438.DTL=20 Los Angeles -- These are flush times for the city's Department of Water and= =20 Power and the energy executives are loving every minute of it.=20 As are their customers.=20 Private power companies throughout California have been raising rates and= =20 warning customers about a long hot summer filled with blackouts but the= =20 city- owned DWP has been keeping prices stable and the lights on for 1.2=20 million Los Angeles customers.=20 Our customers are being really nice to us said Angelina Galiteva the=20 utility's strategic planning director. They love the DWP.=20 Although Gov. Gray Davis' administration announced that the state had reduc= ed=20 its energy consumption 11 percent from a year ago those in Los Angeles had= =20 cut back less than half that -- and polls show they view the energy situati= on=20 less seriously than other Californians.=20 Public utilities such as Los Angeles water and power have seen their revenu= es=20 increase during the energy crunch because they can sell their excess power = at=20 higher prices than ever before in a market tilted toward sellers.=20 The rest of the state doesn't always feel that same warm glow. Davis has=20 accused the DWP and other California public utilities of putting exorbitant= =20 price tags on the excess electricity they sell to the rest of the energy-= =20 starved state.=20 It's a charge Los Angeles utility executives deny arguing that their exces= s=20 power is sold at cost plus 15 percent which they say is a fair return for= =20 their customers.=20 Without our support a million more homes (elsewhere in California) would= =20 have suffered rolling blackouts which is a powerful message Galiteva sai= d.=20 It wasn't supposed to be this way. When the power industry was deregulated = in=20 the late '90s energy giants like Pacific Gas and Electric Co. and Southern= =20 California Edison were expected to be the big winners. Now PG&E is in=20 bankruptcy and Edison is a short step away.=20 When deregulation came the experts said that the investor-owned utilities= =20 would become lean mean machines that would be better able to operate in th= e=20 new environment Galiteva said. But now public power has shown it can ser= ve=20 customers more efficiently at lower rates.=20 While much of the state worries about electrical supply Los Angeles=20 residents have been saved many of those concerns.=20 In a survey done last month by the Public Policy Institute of California 4= 8=20 percent of the people in the Bay Area thought that electricity cost and=20 availability were the most important issues facing the state. In Los Angele= s=20 however only 33 percent put the energy crunch on top. When questioned abou= t=20 the size of the power problem and the effect it would have on the state's= =20 economy Los Angeles residents were consistently less concerned than people= =20 elsewhere in California.=20 People in Los Angeles have been somewhat isolated from the energy crisis= =20 concluded Mark Baldassare who conducted the survey.=20 That doesn't mean the state's energy problems haven't had an effect. The DW= P=20 has seen a 3 percent to 5 percent reduction in some uses which officials= =20 have dubbed sympathy conservation. The utility also is offering its bigge= st=20 customers financial incentives to cut back on their power use.=20 Our average annual load growth is about 80 megawatts Galiteva said. By= =20 this summer we expect to have saved 40 megawatts through conservation. By= =20 December we expect 60 megawatts in savings.=20 The utility also is making a major attempt to create a conservation ethic= =20 among its customers. DWP's comfortable situation has made it possible to=20 offer them the carrot without the need to show them the stick.=20 Conservation no longer means doing without Galiteva said. Beer can be= =20 just as cold with a superefficient refrigerator. Rooms can be just as brigh= t=20 with superefficient light bulbs.=20 A Green Power program also is promoting the use of renewable energy=20 resources such as solar wind and hydroelectric power. About 75000 custome= rs=20 are paying an extra $3 per month to increase DWP's use of renewable power= =20 sources.=20 We're trying to give our customers a choice and a voice in determining the= =20 mix of power they use Galiteva said. They know they can do (conservation= )=20 now or see it being mandated later.=20 Los Angeles power officials -- and their customers -- know the DWP isn't=20 always going to continue as an island of tranquility in a sea of energy=20 turmoil. The utility's aging gas-fired plants have been affected by the=20 rising price of natural gas. Demand for energy continues to rise. In a deba= te=20 last month both candidates for mayor of Los Angeles agreed that increases = in=20 local power bills are inevitable.=20 But the DWP has been supplying power to Los Angeles since 1916 and its=20 executives believe that the state's deregulation disaster has shown the=20 advantages of the city-owned utility.=20 It's nice to be the lean mean green efficient machine that no one ever= =20 expected us to become Galiteva said.=20 E-mail John Wildermuth at 2001 San Francisco Chronicle ? Page?A - 13=20 PG&E doesn't want to pay for energy to avert blackouts=20 DAVID KRAVETS Associated Press Writer Wednesday June 6 2001=20 2001 Associated Press=20 URL:=20 tate0 306EDT0102.DTL=20 (06-06) 00:06 PDT SAN FRANCISCO (AP) --=20 Pacific Gas & Electric Co. has told a bankruptcy judge it should not have t= o=20 pay for what could amount to billions of dollars in spot-market energy cost= s=20 to avert blackouts.=20 The company's position was one of two developments that emerged Tuesday as= =20 the bankrupt utility tries to cope with fallout from California's power=20 crisis. The other development saw a group of creditors that PG&E owes=20 billions endorse $17.5 million in bonuses for top managers at the utility.= =20 San Francisco-based PG&E filed for bankruptcy protection in April after=20 racking up an $8.9 billion debt which under state law it could not recoup= =20 from customers.=20 Tuesday's court dispute centered on who pays for energy bought at the last= =20 minute to avoid blackouts.=20 PG&E said an April federal regulatory decision requires that electricity ca= n=20 only be sold to those with the ability to pay electricity generators. The= =20 state is the only player with such ability said PG&E attorney Jerome Faulk= =20 who argued that the utility shouldn't have to pay the $330 million in month= ly=20 spot-market energy bills.=20 Judge Dennis Montali said he may craft such an order. But he said the order= =20 would not preclude the state from suing PG&E to recover the cost.=20 In a separate but related development a committee charged with devising a= =20 payment plan for those creditors owed billions by PG&E said it will sign of= f=20 on the utility's plan to pay $17.5 million in bonuses to PG&E's management= =20 team.=20 Attorney Allan Marks who represents the committee said such payments are= =20 normal during large bankruptcy cases. Under the agreement which Montali wi= ll=20 consider at a June 18 hearing the company must quickly produce a debt=20 payment plan that passes judicial muster.=20 The utility said it needs the bonuses for a management retention program.= =20 Marks agreed. While the $17.5 million leaves less for creditors without a= =20 financial incentive PG&E's key top brass may not be willing to cooperate wi= th=20 a payment plan Marks said.=20 The main goal for the creditors' support here is to move the bankruptcy as= =20 quickly and smoothly as possible Marks said.=20 The Utility Reform Network a consumer watchdog group says PG&E is simply= =20 rewarding managers of a failed business effort.=20 They're just showering money on the same people who got them in this mess= =20 said TURN's Mike Florio.=20 The proposed bonuses would come on top of $50 million in bonuses and raises= =20 PG&E awarded just before the April 6 bankruptcy filing.=20 The case is In Re Pacific Gas & Electric Co. 01-30923 DM.=20 2001 Associated Press ?=20 Metcalf plant gets preliminary approval=20 Posted at 12:21 a.m. PDT Wednesday June 6 2001=20 BY MIKE ZAPLER=20 Mercury News=20 As the San Jose City Council approached its 10-1 vote Tuesday to give an=20 initial nod to Calpine's big power plant in South San Jose Councilwoman=20 Linda LeZotte perhaps captured the body's mood best.=20 ``I'm holding my nose to vote for this thing'' she said. ``Without faultin= g=20 the mayor or his staff quite frankly I think this deal stinks.''=20 Caught in what some members called a bind beyond their control the council= =20 gave preliminary approval to an agreement negotiated by Mayor Ron Gonzales= =20 and Calpine on the company's proposed 600-megawatt Metcalf Energy Center.= =20 Councilman Forrest Williams who represents the Santa Teresa neighborhood= =20 near the site cast the lone vote against the deal.=20 The agreement is scheduled to come back before the council for a final vote= =20 on June 26 but Tuesday's vote effectively shifts the battle to the courts= =20 where residents are expected to lodge a lawsuit in one final attempt to blo= ck=20 the plant.=20 Still Councilwoman Pat Dando and some of her colleagues raised questions= =20 about the deal they said they want answered before the final vote. Their=20 issues could be incorporated into the final deal.=20 Many of the concerns focused on a $50 million recycled water pipeline=20 Gonzales agreed to have the city build to accommodate the project $10=20 million of which would be reimbursed by Calpine over 30 years.=20 Pipeline possibility=20 Dando said that a private company Great Oaks Water may be willing to buil= d=20 the pipeline extension itself saving the city the $50 million expense.=20 Officials at Great Oaks were unavailable Tuesday.=20 Council members peppered staff with other questions. Many were alarmed by= =20 claims of the Silicon Valley Toxics Coalition which said that using treate= d=20 sewage water to cool the power plant could allow dangerous chemicals to see= p=20 into drinking water aquifers. An environmental services director said the= =20 recycled water meets federal specifications but that there is no protocol= =20 for testing other chemicals not included in those standards.=20 Councilman Ken Yeager asked why Calpine should be allowed to spread a $3.9= =20 million water connection fee over 10 years -- an arrangement that would=20 mandate an amendment to city law.=20 LeZotte meanwhile said she wants to hold Calpine accountable to install= =20 ammonia-free technology at the plant. Ammonia is highly hazardous and=20 residents say the use of the chemical to clean the plant is among their chi= ef=20 concerns.=20 The agreement requires the company to install technology to reduce or=20 eliminate the use ammonia when it becomes ``technologically and economicall= y=20 feasible.'' LeZotte said she wants a clear definition of ``feasible''=20 included in the deal.=20 Tuesday's vote marked a stark departure from the council's November vote to= =20 deny Metcalf. At the time council members said a power plant was=20 inappropriate for the area and many members said Tuesday that they still= =20 believe that.=20 Bowing to pressure=20 But with Gov. Gray Davis endorsing Metcalf in April and the California Ener= gy=20 Commission widely expected to override the city's denial this month counci= l=20 members said they had no choice but to cut the best deal it could and allow= =20 the project to proceed.=20 That explanation however didn't sit well with residents of the Santa Tere= sa=20 neighborhood adjacent to the Metcalf site one of whom accused Gonzales and= =20 the council of ``switching sides when the opposing team gets too close to t= he=20 goal line.''=20 Contact Mike Zapler at mzapler@sjmercury.com or at (408) 275-0140.=20 Feds probe AES Williams=20 Antitrust investigation looks into allegations of manipulated energy prices= =20 through reduced power-plant construction.=20 June 6 2001=20 By JAMES ROWLEY Bloomberg News=20 WASHINGTON - The U.S. Justice Department opened an antitrust investigation= =20 into California's electricity shortage by probing allegations that AES Corp= .=20 and Williams Energy Services Co. are limiting power-plant expansion to driv= e=20 up prices.=20 AES Corp. the biggest U.S. power-plant developer disclosed the=20 investigation in a filing with the U.S. Securities and Exchange Commission.= =20 The Justice Department is looking into a supply-and-marketing agreement=20 between AES' California power-plant unit and a Williams unit that supplies= =20 natural gas.=20 Williams owner of the second-largest U.S. natural-gas pipeline system als= o=20 markets the power produced by AES' three electricity plants in the state.= =20 The department alleges the agreement limits expansion of generating capacit= y=20 near some AES plants.=20 AES said it was cooperating with the Justice Department investigation whic= h=20 began last month into possible violations of Section 1 of the Sherman=20 Antitrust Act.=20 That provision outlaws any restraint of trade that stifles competition.=20 A shortage of generating capacity in California has led to soaring wholesal= e=20 prices and rolling blackouts and prompted Pacific Gas & Electric the state= 's=20 largest utility to seek bankruptcy protection in April.=20 Aaron Thomas a spokesman for AES based in Arlington Va. said the U.S.= =20 investigation started no more than a couple of weeks ago.=20 Williams spokeswoman Paula Hall-Collins said the Tulsa Okla.-based company= =20 is cooperating.=20 Gina Talamona Justice Department spokeswoman said the agency had no=20 immediate comment.=20 The investigation was opened several weeks after the Federal Energy=20 Regulatory Commission investigated AES plants in Long Beach and Huntington= =20 Beach designated must run under the Federal Power Act did not produce= =20 electricity for 10 days in April and May 2000. Williams agreed to pay the= =20 operator of California's electric grid $8 million to settle allegations tha= t=20 it overcharged for power.=20 FERC charged in March that the companies had a financial incentive to keep= =20 the units out of service to force the California Independent System Operato= r=20 to buy power from AES' plant in Redondo Beach at prices close to the=20 FERC-imposed cap of $750 per megawatt-hour.=20 AES said it was complying with a Justice Department demand for documents=20 about the agreement between its AES Southland LLC unit and Williams Energy= =20 Services Co. AES Southland which operates the three power plants was also= =20 asked to respond to interrogatories the company said.=20 The Williams unit supplies the natural gas to fuel the AES plants and marke= ts=20 the power they produce.=20 AES and Williams jointly produce and sell about 4000 megawatts in Californ= ia=20 -- 6 to 8 percent of the state's power -- enough electricity to light about= 3=20 million typical California homes.=20 AES shares dropped $2.05 to $42.54. Williams Cos. shares dropped $1 to=20 $38.20. Calpine Begins Construction of Peaking Energy Center in Gilroy Calif.=20 June 6 2001=20 SAN JOSE Calif. June 5 /PRNewswire/ via NewsEdge Corporation -=20 Calpine Corporation (NYSE: CPN) the San Jose Calif.-based independent pow= er=20 company today announced that initial construction of 135 megawatts (mw) of= =20 peaking generation capacity will begin during this week adjacent to its=20 existing Gilroy Power Plant in Gilroy Calif. Through an Application for=20 Certification (AFC) filed with the California Energy Commission (CEC) on=20 April 25 2001 Calpine proposed to add three 45-mw simple-cycle gas turbin= e=20 peaking units in the first of a two-phase process. The California Energy=20 Commission approved the project on May 21 2001.=20 Because the required natural gas water and transmission infrastructure=20 exists at our Gilroy plant it is an ideal site for the addition of peaking= =20 generation allowing for rapid installation of needed capacity. The first= =20 three units are expected to begin generating electricity this September= =20 commented Bryan Bertacchi Calpine Vice President - Western Region.=20 Upon completion the two-phase build out the Gilroy Energy Center will be a= =20 270-mw natural gas-fired simple-cycle peaking generation facility located= =20 on approximately 9.5 acres at 1400 Pacheco Pass Highway in Gilroy. Commerci= al=20 operation of Phase One is scheduled for September 2001. An additional three= =20 45-mw gas turbine generators will be installed in Phase Two with full=20 build-out estimated for May 2002. Phase Two requires the filing of an=20 additional application with the CEC and is subject to a four-month review= =20 process.=20 Initial construction will begin this week with site and civil engineering= =20 activities occurring for approximately six weeks at which time the site wil= l=20 be cleared and leveled. Foundation work and the installation of generation= =20 equipment will follow shortly thereafter and commissioning and testing wil= l=20 take place for a two to three week period prior to commercial operation in= =20 September 2001.=20 The Gilroy Energy Center web site has been created to host all information= =20 and updates related to this project. For additional information please vis= it=20 www.gilroypower.com.=20 Calpine Corporation based in San Jose Calif. is dedicated to providing= =20 customers with reliable and competitively priced electricity. Calpine is=20 focused on clean efficient natural gas-fired generation and is the world'= s=20 largest producer of renewable geothermal energy. Calpine has launched the= =20 largest power development program in North America. To date the company ha= s=20 approximately 32200 megawatts of base load capacity and 7200 megawatts of= =20 peaking capacity in operation under construction pending acquisitions and= =20 in announced development in 29 states and Canada. The company was founded i= n=20 1984 and is publicly traded on the New York Stock Exchange under the symbol= =20 CPN. For more information about Calpine visit its Website at=20 www.calpine.com.=20 This news release discusses certain matters that may be considered=20 forward-looking statements within the meaning of Section 27A of the=20 Securities Act of 1933 as amended and Section 21E of the Securities=20 Exchange Act of 1934 as amended including statements regarding the intent= =20 belief or current expectations of Calpine Corporation (the Company) and i= ts=20 management. Prospective investors are cautioned that any such forward-looki= ng=20 statements are not guarantees of future performance and involve a number of= =20 risks and uncertainties that could materially affect actual results such as= =20 but not limited to (i) changes in government regulations including pendin= g=20 changes in California and anticipated deregulation of the electric energy= =20 industry (ii) commercial operations of new plants that may be delayed or= =20 prevented because of various development and construction risks such as a= =20 failure to obtain financing and the necessary permits to operate or the=20 failure of third-party contractors to perform their contractual obligations= =20 (iii) cost estimates are preliminary and actual cost may be higher than=20 estimated (iv) the assurance that the Company will develop additional=20 plants (v) a competitor's development of a lower-cost generating gas-fired= =20 power plant and (vi) the risks associated with marketing and selling power= =20 from power plants in the newly competitive energy market. Prospective=20 investors are also cautioned that the California energy environment remains= =20 uncertain. The Company's management is working closely with a number of=20 parties to resolve the current uncertainty while protecting the Company's= =20 interests. Management believes that a final resolution will not have a=20 material adverse impact on the Company. Prospective investors are also=20 referred to the other risks identified from time to time in the Company's= =20 reports and registration statements filed with the Securities and Exchange= =20 Commission.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Calpine Corporation=20 CONTACT: media Lisa Poelle ext. 1285 or investors Rick Barraza ext.=20 1125 both of Calpine Corporation 408-995-5115=20 Web site: http://www.gilroypower.com=20 Web site: http://www.calpine.com (CPN)=20 Reliant Urges FERC to Drop or Amend California Price Caps to Avoid Addition= al=20 Shortages and More Blackouts=20 June 6 2001=20 HOUSTON June 5 /PRNewswire/ via NewsEdge Corporation -=20 Reliant Energy (NYSE: REI) filed an emergency motion with the Federal Energ= y=20 Regulatory Commission (FERC) on Monday urging the agency to drop the=20 California price caps first applied May 29 or at a minimum amend them to= =20 reflect the true costs they are attempting to control. The current price=20 caps which send inaccurate market signals are actually decreasing supply= =20 and increasing demand thus worsening an already dire situation.=20 FERC has been publicly dedicated to an open market from the beginning of t= he=20 California power crisis. We encourage FERC to reexamine these price caps an= d=20 continue that dedication said Joe Bob Perkins president and chief=20 operating officer Reliant Energy Wholesale Group. Reliant is committed to= =20 helping keep the lights on in California this summer and wants to ensure th= at=20 if caps must remain part of the picture they actually help increase supply= =20 and fix the problem.=20 Although the price caps were first imposed less than a week ago they have= =20 already begun to damage the market by decreasing supply. The price caps are= =20 creating a myriad of problems:=20 -- Creates Misleading Signals - The price cap methodology is misleading=20 the public on the actual cost of power. Reported dispatch costs in=20 Southern California during emergencies is far below what the actual=20 financial settlements will be under the FERC's final market mitigation=20 order. This confusion results from the proxy price used for=20 dispatch utilizing an extremely distorted blended fuel cost index.=20 This index averages gas costs in northern and southern parts of the=20 state an impossibility in the actual market. This authorizes the=20 California Independent System Operator (ISO) to require that=20 generators dispatch power at reported market clearing prices well=20 below actual cost when back-up generation capacity begins to dip below=20 7.5 percent.=20 -- Depletes Power from Peaking Plants - The price caps distort dispatch=20 signals on peaking plants which in some cases may be run only a few=20 days of the year because of emission regulations. The current FERC=20 price controls encourage the ISO to purchase power from emergency=20 peaking plants before it is really needed even in the absence of a=20 stage three emergency. This depletes supplies that will by law run=20 out when blackout season intensifies later this summer. This power=20 from peaking units should only be purchased when blackouts are=20 imminent -- not in stage one or two emergencies.=20 -- Eliminates Price Signals for Retail Customers - Price caps remove=20 price signals for retail customers. Customers particularly=20 industrial companies which should be encouraged to curtail during=20 shortages are not encouraged to conserve power when dispatched price=20 caps keep prices below the actual cost to produce electricity.=20 -- Discourages Supply from Out-of-State - Suppliers outside of=20 California who are under no legal obligation to dispatch power during=20 an emergency in the state are not encouraged to increase available=20 production when reported market clearing prices are below their cost=20 to produce. During times of emergencies utilities across the Western=20 region are not likely to take on additional risks and costs if they=20 don't believe they will be fully compensated - a situation the current=20 price caps create.=20 MAKE YOUR OPINION COUNT - Click Here=20 SOURCE Reliant Energy=20 CONTACT: Maxine Enciso of Ketchum Public Relations Los Angeles=20 310-444-1303 for Reliant Energy or media Richard Wheatley of Reliant=20 Energy 713-207-5881=20 Photo: NewsCom: AP=20 Archive: http://photoarchive.ap.org PRN Photo Desk 888-776-6555 or=20 212-782-2840=20 Company News On-Call: or fax=20 800-758-5804 ext. 419090=20 Web site: http://www.reliantenergy.com (REI)=20 By Kathleen McFall kmcfall@ftenergy.com President George W. Bush's energy package encourages the use of biomass fue= ls=20 for both transportation purposes and electricity generation. They can=20 provide a reliable source of energy at a stable price and they can also=20 generate income for farmers landowners and others who harness them his= =20 administration's report said.=20 Despite this warm and fuzzy language however the administration offered n= o=20 tangible funding for the fledgling biofuels industry=01*other than an exten= sion=20 of an existing ethanol tax credit that was not due to expire until 2007=01*= a=20 significant disappointment and surprise to advocates of renewable=20 transportation fuels. The report did recommend expanding tax credits for biomass energy projects = to=20 include forest-related and agriculture fuel sources and threw its weighty= =20 support at a new credit for electricity produced from biomass co-fired with= =20 coal. These recommendations are already included in the president's 2002=20 budget.=20 We are pleased that the administration included expansion of the biomass t= ax=20 credit and hope that with congressional leadership we will see this=20 expanded provision signed into law this year said Katherine Hamilton=20 co-director of the American Bioenergy Association (ABA).=20 Unlike other portions of the recommended energy policy biomass energy=20 probably will not suffer under the recent change in Senate composition giv= en=20 Senate Majority Leader Tom Daschle's (D-S.D.) agricultural constituency and= =20 his previous support of the biofuels industry.=20 According to the National Energy Policy Development report biomass account= s=20 for about 76% of non-hydropower renewable electricity generation=20 representing a total of about 1.6% of total U.S. electricity supply.=20 Biopower advocates however envision an even greater market penetration in= =20 the coming decades and point to its environmental and ancillary advantages.= =20 For example given that biomass combustion can be carbon dioxide-neutral (i= f=20 the growth and use cycle is managed sustainably) environmental groups=20 support an expanded role. Farmers with marginal lands that could grow bioma= ss=20 fuel could enjoy economic benefits. With large amounts of wood residue the= =20 forest industry also stands to benefit from wider use of wood as a power=20 source.=20 Renewable energy offers a particular advantage to the lumber and paper=20 industry and many analysts project that the industry may soon become a net= =20 seller of electricity.=20 In the lumber and paper industries wood scraps are sometimes directly fed= =20 into boilers to produce steam for their manufacturing processes or to heat= =20 their buildings. For that reason renewable energy offers a particular=20 advantage to the lumber and paper industry and many analysts project that= =20 the industry may soon become a net seller of electricity said the energy= =20 policy report.=20 Co-firing with coal Biomass=01*usually wood or wood residue=01*has traditionally been burned di= rectly=20 in the industrial sector for heat or on-site electricity generation.=20 According to the U.S. Department of Energy (DOE) the existing 10 GW of=20 installed capacity are based on this direct-combustion technology.=20 For utilities and power-generating companies with coal-fired capacity=20 however biomass co-firing may represent one of the least-cost renewable=20 energy options said the DOE. The process involves blending different=20 materials in varying amounts with coal.=20 Not only does mixing biomass with coal reduce emissions it is likely to be= =20 cost-effective. Southern Co. estimates that a biomass plant alone could=20 generate power depending on its location at 4 to 11 cents/kWh. Given that= =20 the lower range of this corresponds to coal generation costs there are=20 clearly circumstances where biomass-coal co-firing would be economically=20 attractive today. Plus the environmental public relations benefit for=20 utilities with coal-fired capacity would be valuable.=20 Domestic biomass generation capacity could reach 20-30 GW by the year 2020 = by=20 co-firing at existing U.S. coal-fired power plants.=20 According to a recent report prepared by five National Laboratories domest= ic=20 biomass generation capacity could reach 20-30 GW by the year 2020 by=20 co-firing at existing U.S. coal-fired power plants.=20 A recent report by the United Nations Intergovernmental Panel for Climate= =20 Change (IPCC) also cites the potential of coal co-firing with biomass. The= =20 IPCC report concludes that co-firing in coal boilers results in the lowest= =20 cost and least technical risk of the examined approaches for biomass=20 conversion to electricity.=20 Working out the technical kinks Already said the DOE six power plants in the U.S. are currently co-firing= =20 coal and wood residue products on a regular basis. Another 10 plants have= =20 successfully tested co-firing over the last decade and at least six more= =20 plants are now conducting or planning tests.=20 For example Southern Co. is working with DOE the Southern Research=20 Institute and the Electric Power Research Institute to study ways to grow a= nd=20 harvest switchgrass to blend with coal as a fuel for power generation.=20 Ideally suited for the southeastern U.S. switchgrass is a rugged grass tha= t=20 can be grown on marginal agricultural land. Reaching heights of up to 12=20 feet it requires little fertilization and herbicide and can be harvested= =20 twice a year.=20 Harvesting methods co-milling of switchgrass and pulverized coal=20 pilot-scale co-firing tests and a full-scale demonstration of co-firing at= =20 Alabama Power Co.'s Plant Gadsden are part of Southern Co.'s collaborative= =20 project.=20 The U.S. Agriculture Department is also taking a role in exploring the=20 potential of biomass and coal co-firing as a means to give farmers new=20 markets especially for currently idle land. The agency recently authorized= =20 funding for three co-firing demonstration projects.=20 In Iowa the Chariton Valley Biomass Project is a cooperative effort to=20 develop warm and cool season grasses (such as switchgrass) to co-fire with= =20 coal at Alliant Energy's Ottumwa Generating Station. The project is designe= d=20 to generate a sustained supply of 35 MW of biomass energy. Eventually the= =20 grass could substitute for as much as 5% of the coal currently burned at th= e=20 plant.=20 In addition to reducing coal emissions the Chariton Valley Biomass Project= =20 will support the local farm economy.=20 In addition to reducing coal emissions the project will support the local= =20 farm economy because the grass and trees will come from acreage taken out o= f=20 production under the Agriculture Department's Conservation Reserve Program= =20 (CRP). CRP land is generally marginal land that the government subsidizes= =20 farmers to leave idle to both prevent erosion and protect commodity prices= =20 from product surpluses.=20 The Pennsylvania Switchgrass Energy and Conservation Project will produce= =20 switchgrass on CRP land for sale to a local cooperative's coal-fired=20 fluid-bed combustors.=20 In New York the Agriculture Department project will fund willow biomass=20 crops and switchgrass on CRP acreage in the central and western part of the= =20 state. The primary markets for the willow biomass are two coal-burning powe= r=20 plants and a small university central heating facility.=20 Land conflicts transportation may be obstacles As these pilot projects illustrate biomass conversion efforts may have the= =20 most significant potential in rural areas. Since biomass is widely=20 distributed it has good potential to provide rural areas with a renewable= =20 source of energy. The challenge is to provide =01( conversion and delivery = of=20 bioenergy to the marketplace in the form of modern and competitive energy= =20 sources said the IPCC report.=20 A potential drawback to co-firing is transportation. Transportation of=20 wood-based energy products is more costly per unit of energy than coal f= or=20 example and most analysts believe it will prove most economical to site=20 generation plants near biomass sources.=20 The generating plant or biorefinery must be located near to the resource t= o=20 minimize transport costs of the low-energy-density biomass as well as to=20 minimize impacts on air and water use the IPCC report said. However note= s=20 the report's authors economies of scale may be significant enough to offse= t=20 the transport costs involved.=20 A potential drawback over the long term however for biomass conversion is= =20 land use conflicts. The IPCC report notes that by 2100 the global land=20 requirement to feed the growing world population will increase substantiall= y.=20 Up until this time there may well be sufficient land to supply all demands= =20 for food fibre and energy but at some stage after that land-use conflict= s=20 could arise and before that competition for water and irrigation may be a= =20 constraint.=20 What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Dynegy/Enron Point of Contact Body:: =09Are there any plans for either Enron or Dynegy (or both) to initiate inf= ormation dissemination to Capitol Hill as is usually =09done in these situations? This is what I have experienced when on the H= ill and when representing companies either =09being acquired or doing the merger/acquisition. Our friends on the Hill= will wonder where we and they have been =09particularly if as is likely we may need them later on. Better to get= in with them on the ground floor. I know there is a =09lot going on but it would be beneficial to the merger approval process = to at least have informal contacts starting this week =09before they leave for Thanksgiving. =09Thanks for the conference calls to keep us up to date and for being cand= id in doing so. =09John What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Revised Merger Release & Q&A Body:: looks ok to me Karen Denne 03/13/2001 11:54 AM To: Mark Metts/Enron@EnronXGate Steven J Kean/NA/Enron@Enron cc: Subject: Revised Merger Release & Q&A fyi... ----------------- What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential Employee Info Body:: -Larry Jester(mid yr-superior and yr end-strong)-Reports to D. Gilbert-Smith .Real time trader great job looking for career advancement possibilities -Keller Mayeaux (mid yr-strong and yr end-satisfactory)-He was disgruntled at yr end and as a result he asked to get out of agreement and leave Enron now he w/d like to stay at Enron. Jester is preferable to Mayeaux. Other groups are recruiting Jester. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: California Amendments DEFEATED! Body:: Congrats Linda Robertson 07/19/2001 09:44 AM To: Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron James D Steffes/NA/Enron@Enron mark s palmer/enron@enronXgate@Enron cc: Subject: California Amendments DEFEATED! John Shelk will provide a more thorough report in a later Email but I just wanted you to know that the Waxman price cap amendment was just defeated in full Committee markup and the Eshoo refund amendment was defeated. Both by sizable margins. What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: SCE Counter Claim -- Underreporting of Volumes -- Confidential -- Attorney Work Product Body:: JBennett 05/18/2001 01:25 PM To: Robert Williams (E-mail) Richard Sanders (E-mail) Mike Smith (E-mail) Dennis Benevides (E-mail) George Phillips (E-mail) cc: MDay Subject: SCE Counter Claim -- Underreporting of Volumes -- Confidential -- Attorney Work Product After speaking with George Phillips yesterday about SCE's counterclaim against EES and EEMC regarding underreporting of usage to the ISO I think there may be some internal confusion (of which I may have contributed to) about the nature of SCE's counterclaim. As I understand from my review of certain documents received from SCE in response to our data requests review of an Executive Summary prepared by George Phillips on the issue and from my conversation with him yesterday EES and EEMC as a result of some problems with their settlement system did indeed underreport customers' usage to the ISO during the time period claimed by SCE. This has I believe resulted in two separate (although interrelated) points of contention with SCE -- of which only one is the subject matter of its counterclaim. First the underreporting resulted in Unaccounted For Energy (UFE) charges to the market. In correspondence sent by SCE to EEMC and EES during the last quarter of 2001 it appears that SCE was calculating the cost to the market from the EES/EEMC underreporting by applying the hourly day ahead market clearing price to the individual hourly variances. This cost to the market is overestimated however as SCE failed to take into account the fact that the ISO nets underreported amounts against overreported accounts to get a net amount of underreporting. This underreported amount is then allocated to all providers of physical load within a service territory through the assessment of UFE charges. Thus whatever the ultimate cost was determined to be SCE would not be allocated the entire amount. Second the underreporting of usage to the ISO results according to SCE in SCE paying EES and EEMC a PX credit for energy they never purchased. This claim is separate and apart from what SCE claims EES/EEMC cost the market in the way of UFE charges. What SCE is saying is that it believes that EES and EEMC only purchased on behalf of their customers the amount of energy which they reported to the ISO. EES' and EEMC's customers actually used more than the amount which EES and EEMC reported. SCE calculated the PX credit based on the amount used not reported. It is SCE's claim that EES and EEMC are not entitled to a PX credit on the delta as the market not EES and EEMC purchased those volumes. It is only the second point of contention which is the subject matter of SCE's counterclaim. SCE is alleging that it should not have to pay a PX credit to EES and EEMC for volumes that EES and EEMC did not purchase. SCE is claiming that we only purchased the amount we reported to the ISO. While SCE may believe that it should not have to pay any UFE charges as the result of EES/EEMC underreporting the UFE charges are not the basis of its counterclaim. Based on the above analysis I think that the most critical piece of information to refute the counterclaim is that despite the underreporting of volumes to the ISO EES and EEMC actually purchased on behalf of their DA customers those customers' full usage. Can we make such claim? and do we have data to back it up? Jeanne Bennett What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Daily Update/ Legislative activity - 08/24/00 Body:: I attended Cmmr. Wood's two-day hearing on Wholesale Markets which concluded today (8/24) in San Diego. Three Commissioner's were present (Wood Lynch and Neeper) with Duque and Bilas participating by phone. Administrative Law Judge Wetzel was present and a transcript was taken. The quasi-legislative hearing was the beginning of a record developed for the investigation into the workings of wholesale/retail markets. This session focused on Wholesale markets. There will be subsequent sessions on retail issues market structure and other related issues in the future. My conclusion from this session is that Wood is looking for support for increasing regulatory intervention in the market. Dan Larcamp Director of the Office of markets Tariffs and Rates FERC was present. He relayed FERC's concern of this matter and a desire to hold hearings in San Diego. He also relayed that Hoecker held a press conference announcing the opening of a 206 investigative proceeding into the operation of the wholesale markets in California which carried with it refund authority. The format of the hearing was to respond to pre-filed questions developed by Wood/Lynch. Each member of the panel would respond to the questions and any questions posed by the Commissioners the Judge or the CPUC Attorney. No questions were posed by members of the audience. Yesterday's panel of academics were comprised of: 1. Dr. Timothy Duane-UC Berkley 2. Dr. William Hogan-Harvard 3. Dr. Frank Wolak-Stanford (ISO Market Surveillance Committee) 4. David Marcus-Energy Consultant for the Coaltion of Utility Employees 5. Dr. Gene Coyle 6. Dr. Jean-Michel Glachant Universite Paris I Pantheon Sorbonne The panel was asked to speak as individuals and not on behalf of any institutions they may represent. While the purpose of the panel seemed to be to determine that market power was being exercised and that prices were too high and therefore not just and reasonable the panelist stopped short of blaming generators and market participants in behaving illegally. The concensus generally was that market power did exist at various times but the mere existence did not constitute bad behavior. None with the exception of Dr. Wolak who is in the process of doing a study using recent data as part of his role for the Market Surveillance Committee had done a study. There was some discussion though not much of the monopsony power of the utilities. I think ultimately the group conceded that scarcity of supply amplified concerns about the exercise of market power as even the increase in gas costs did not fully explain the recent spikes. Wolak believes that encourage utilities to enter into forward purchases will reduce the exercise of real-time market power. Hogan seemed to be there with Sempra's interests in mind. He continued to promote expansion of the ISO's abilities to dispatch load as well as maintain system reliability. There was alot of discussion about forward purchase ability for utilities so as to be less subject to volatile market prices. The concerns were also discussed about the appropriateness of a distribution utility making purchasing decisions on behalf of its customers. This included discussion of separation of these functions and the default provider role. Most everyone agreed that rolling back to a regulated market was not feasible without raising other major and serious concerns however there seemed to be support for some interim measures where cost-of-service regulation may be a good idea and that was during peak periods. All agreed that a demand response and price signals are important in the long-run although not to the extent currently experienced in San Diego. Today's panel included representatives from SDG&E SCE and PG&E TURN UCAN and ORA. While yesterday's panel maintained objectivity as to whether or not generators were exercising market power to the detriment of the system today's panel made no bones about the generators being to blame. SCE/PG&E indicated their need for relief for recovery of market costs in excess of the rate freeze. SDG&E was still on the hot seat for their inaction in hedging any of their supply. SDG&E brought up their failed PBR proposal and ORA and UCAN thought that that may be one way to incent the utility to be more responsible with their purchases. UCAN discussed the Governor's direction and the potential for putting rate caps into affect for residential and small commercial. He mentioned that C&I customers are experience difficulties as well. TURN raised the need for cost-based bid caps and cost-based peaking contracts. Mike Florio TURN urged against any further divestitute of assets and alleged market concentration on those assets that had been divested. In fact TURN urged the Commission to seek legislation to clarify the Commission's authority to order retention of assets. Neeper urged that part of the solution should be changing the current requirement to use the PX as the only authorized exchange although TURN disagreed. Bruno Gaillard 08/24/2000 06:09 PM To: SF Directors Edward Hamb/HOU/EES@EES Jennifer Rudolph/HOU/EES@EES Chris Hendrix/HOU/EES@EES Greg Cordell/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Martin Wenzel/SFO/HOU/EES@EES Douglas Condon/SFO/EES@EES James M Wood/HOU/EES@EES Gary Mirich/HOU/EES@EES Dennis Benevides/HOU/EES@EES Roger Yang/SFO/EES@EES David Parquet@ECT mday@gmssr.com Paul Kaufman/PDX/ECT@ECT Marcie Milner/Corp/Enron@ENRON Mary Hain@Enron Harry Kingerski/HOU/EES@EES James D Steffes/HOU/EES@EES Richard Shapiro/HOU/EES@EES Peggy Mahoney/HOU/EES@EES Karen Denne@Enron Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Tim Belden/HOU/ECT@ECT cc: Subject: Daily Update/ Legislative activity - 08/24/00 Siting related bills 1. Good new - The Williamson Act passed the Senate 34-1 It should be heard at the assembly Saturday or Monday if it is not redirected to a Committee hearing. 2. There was a long meeting with Ducheny with regards to AB 970. The enviro's boycotted they want to draft a bill with Keeley. Labor was obstructionist - they wanted to gut all the expediting siting language with regards to all facilities except for the peaking plants. Rate Cap related bills 1. The Edison Language on Rate Stabilization may not go anywhere. Edison has not found an author because of the efforts of Enron and others lobbying against it. Furthermore there are signs that Gov. Davis opposes it. 2. The Governor's office has issued a proposed language for a rate cap bill. The language however is not available as of yet. It may be released today or tomorrow. SDG&E has shown concerns over the content of the bill. They seem to think that it is worse than initially proposed by the Governor in his press release. The bill includes retroactive rate caps through 6/1/00. The rate cap could reflect Wood's rate cap proposal (6.5 cts cap on the energy component The bill does not specify who or how the costs associated with the cap will be recovered. (The reasoning is that UDCs will be more cautious in their procurement if there is uncertainty on who is responsible for the costs.) All of this is speculative. We hope to see the actual language soon. 3. Enron has been working with the Republican leadership to promote a rate cap proposal similar to the amended language we have proposed for AB2290. The bill focuses only on SDG&E customers and our major principals are the following. The Interim Rate Cap should be limited to residential and small commercial customers plus specific institutions that have a significant public role such as schools and hospitals. The Interim Rate Cap should be limited to the period ending December 31 2001. The Interim Rate Cap must be structured so that any undercollection is eventually recovered from the same customers who benefit from the lower rates provided by the rate cap. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: NEW DRAFT OF ENRON STATEMENT Body:: As discussed. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Body:: On the advice of my much esteemed spouse I would like to express great interest in this group. Thanks Gilbert R. Whitaker Jr. on 02/18/2000 04:09:37 PM To: skean@enron.com cc: Subject: Steve - I made a mistake in my earlier email. Our Council of Overseers does not yet have a written charter. However it really is a key advisory group to the Jones School. gil What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: Important - CPUC Motion - Confidential Attorney ClientPrivil ege and Work Product Body:: While I appreciate the virtue of flying below the radar if possible the matter here is complicated by the fact that FERC's discovery rules (18 CFR Subpart D) pertain only to proceedings set for hearing . . . and to such proceedings as the Commission may order. 18 CFR 385.401. In this case FERC stated that a trial-type hearing is not necessary . . . . and specifically rejected the use of a trial-type evidentiary hearing. Slip op. at 47-48 & n.97. Thus while I have not researched the matter as yet my preliminary view is that the CPUC's attempt to invoke FERC's discovery processes would appear to be outside the contemplation of FERC's Nov. 1 order and its regulations unless FERC specifically orders discovery in this case. (The CPUC seems to recognize the relevance of this consideration when it specifically attempts to equate paper hearings with trial-type hearings see page 1 of its Motion.) The CPUC's motion may prompt FERC to decide whether or not to allow discovery in this case under Rule 401. While the CPUC's motion does not apply directly to marketers FERC's ruling will be precedent in the event the CPUC or someone else hereafter serves discovery on other parties. As a result we need to consider whether laying in the weeds risks losing an opportunity to present our views on whether FERC should allow discovery in a paper hearing with an expedited decisional track particularly in light of the fact that Staff has already conducted. >>> Jeffrey Watkiss 11/08/00 10:31AM >>> Does anyone have an idea as to why marketers including EPMI are not included in the list of subject companies: Exh. B? Since EPMI is not a subject of the motion why should it answer? Lying in the weeds may be a more prudent course of action. >>> Fergus Gary S. 11/07/00 10:08PM >>> I just spoke with Mary to make sure we have the same information. Here are the facts we have so far. On November 4th the CPUC filed a motion with FERC to adopt the form of protective order that the CPUC entered to compel the production of documents and to shorten time to answer. According to Exhibit B (read to me by Nancy Pickover at Bracewell) the following CPUC moved against the following entities: AES Williams Duke Dynegy Reliant and Southern. Enron entities were NOT named in exhibit B. This is not to say that we could not be easily added to the group. While the motion reads as if the CPUC was moving against everybody in fact in footnote 2 they state they are only moving against the entities named in Exhibit B. We will have Exhibit B in hand first thing tomorrow via FEDEX to confirm this. To repeat Enron is not named yet. Thanks Gary What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Dow Jones: Enron, Bushs Biggest Contributor Body:: nan What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential SNAP Special Report Body:: Confidential Rika I spoke to Kevin the other day and we discussed the attached special report. Please read over and call me to review. There was already a problem today a TMI Fred - Update 011016.xls What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: 1. London, June 28 - 29; 2. Houston, July 16 - 17 Body:: Shirley Just Zimin and Vasant if they are free. Vince What should this email be categorized as? [/INST] Personal but in professional context " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: 2000 eSpeak Schedule Body:: Looks like a full slate you're off to a great start. Maureen -- please put times and locations on my calendar as an fyi. Sarah Palmer@ECT 01/05/2000 02:24 PM To: Steven J Kean/HOU/EES@EES cc: Mark Palmer/Corp/Enron@ENRON Marie Hejka/Corp/Enron@ENRON Subject: 2000 eSpeak Schedule Steve: Attached are the eSpeak events currently scheduled for 2000. Please review at your convenience. Have a great day! The eThink Team What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Youre On! Body:: fyi ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Talking Points For Rep. Barton On Tauzin RTO Letter Body:: Linda requested some background and talking points on the pending RTO letter from Chairman Tauzin to FERC that is sitting on Chairman Barton's desk TODAY for his decision whether to co-sign the letter. While we have not seen the text we are told that it is anti-RTO and may go so far as to state or imply that FERC does not have authority to do what is doing with RTOs. (We know this is the view of one of Chairman Tauzin's counsels who formerly worked for Southern Co.). Chairman Tauzin has been contacted by Entergy and the Louisiana Public Service Commission to send the letter. I spoke to Chairman Barton's staff Andy Black this afternoon and relayed our concerns. The Barton Subcommittee is now expected to mark up an electricity bill in December (per a Republican Member meeting held this morning). ACTION ITEM: Call Rep. Joe Barton (202/225-2002) TALKING POINTS: 1. Should start with something about the Dynegy/Enron transaction (it will be strange if Mr. Lay or Steve calls Chairman Barton and does not start the conversation with some reference to the transaction). 2. Mentioning the transaction naturally leads into the importance of competitive wholesale markets for power both for consumers and for the largely Texas-based marketing trading and merchant power industries. 3. We understand that Chairman Barton has been approached by Chairman Tauzin about a letter to FERC on the RTO issue. We know Chairman Barton is well aware of Enron's strong support for FERC's RTO initiatives. We respect Chairman Barton's interest in seeing to it that Congress does not abdicate its responsibility to make energy policy. 4. If as we have been lead to believe the letter states or implies that FERC does not have authority to act in the RTO arena this will be seen as a potentially destabilizing development since FERC is so far down the road of creating RTOs. 5. While we understand some in Congress and elsewhere were concerned that FERC was moving too fast as of the last FERC meeting earlier this month that is no longer true even if it ever was true. While we think RTOs should be created sooner rather than later FERC is listening to state regulators and others who had concerns. 6. A letter from congressional leaders questioning FERC's authority goes too far in the direction of those who oppose any RTOs. Furthermore it is wrong as a matter of law. The D.C. Circuit held in the gas cases and in the power cases on Order 888 that FERC has authority to address systemic discrimination which is in large part what the RTOs are all about -- a remedy for iscrimination. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: nan Body:: Just received a voicemail from Stan. He knows Mike he does not have any spots for him right now. My suspicion is that the EES discussions are not ultimately going to yield fruit. We are probably going to have to discuss what's next. What should this email be categorized as? [/INST] Employment arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Mr. Lay is being honored by the Houston Rotary Club as Citizen of the Year. You are invited to attend luncheon. Vanessa Groscrand will follow up with details. Body:: Junior League by the Ritz starts at 12:00 there's an Enron table buffet line. Parking garage is adjacent to the Junior League. What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: How about lunch? Body:: A typical utility luncheon. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: EBS Article for eBiz Body:: See attached From: Karen Denne/ENRON@enronXgate on 07/12/2001 08:33 PM To: Jim Fallon/Enron Communications@Enron Communications Ken Rice/Enron Communications@Enron Communications cc: Mark Palmer/ENRON@enronXgate Steven J Kean/NA/Enron@Enron Kelly Kimberly/Enron Communications@Enron Communications Subject: EBS Article for eBiz Jim and Ken -- Attached is an article for eBiz (our biweekly online newsletter) which we are scheduled to launch at 7:30 a.m. Friday. Kelly Kimberly has reviewed it but has asked that you view the article as well. Since only EBS employees received your memo about the restructuring -- and the rest of the employees did not receive any communication -- it is extremely important to provide information through this vehicle. Please let me know of your approval or if you have any questions. Thank you. Karen x39757 What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: DOE Task Force Meeting - Plymouth MA- Not going Body:: Bob Silvanik -- Council of State Governments annual meeting in Dec 8 (CEO panel including Skilling and Hydro Qubecs Kayee? Panel runs 10:45 - 12:15. (606)244-8250 What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: PRIVILEGED AND CONFIDENTIAL - Christopher Stelzer Draft Body:: Attached is the draft testimony of Christopher Stelzer on behalf of Avista Energy. If possible we would appreciate comments no later than 3:00 PM EST on Sunday August 26. Comments can be faxed to my attention at 202/338-2416 or emailed to cfr@vnf.com or gdb@vnf.com (Gary Bachman). Thank you. Cheryl Feik Ryan Van Ness Feldman P.C. 1050 Thomas Jefferson Street NW Washington DC 20007 202/298-1845 cfr@vnf.com This email message is intended solely for the individual or individuals named above. It may contain confidential attorney-client privileged information and/or attorney work product. If the reader of this message is not the intended recipient you are requested not to read copy or distribute it or any of the information it contains. Please delete it immediately and notify the sender by return email or by telephone. Thank you. - 107177_1.DOC What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Energy Issues Body:: Please see the following articles: Oakland Trib Wed 3/7: Breakthrough made in rescue of PG&E Bakersfield Californian Wed 3/7: El Paso Energy closes six valley power plants Contra Costa Times Wed 3/7: Still undecided: Who'll pay DWR for electricity SF Chron Wed 3/7: State Taxpayers In Dark on Details Of Energy Deal Sac Bee Wed 3/7: Lawmakers pitch fixes for region's energy woes Orange Co. Register Wed 3/7: Power plan called wrong LA Times - Wed 3/7: Bill to Cut Some Power Prices Stalls Sac Bee Wed 3/7: PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts SF Chron Wed 3/7: PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service San Jose Mercury Wed 3/7: Power prices could soar during the summer SF Chron Wed 3/7: Power Plant Plans Cause Conflicts East county residents blast supervisors Contra Costa Times Wed 3/7: Supervisors set search for power plant sites Sac Bee Wed 3/7: Peter Schrag: California's $90 billion infrastructure gap Contra Costa Times Wed 3/7: PG&E power plan debated at hearing SF Chron Thurs. 3/8: State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August WSJ Thurs. 3/8: Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals ------------------------ Breakthrough made in rescue of PG&E State ready to pay $7 billion for lines By Steve Geissinger SACRAMENTO BUREAU SACRAMENTO -- Signaling a breakthrough in secret energy crisis talks the Davis administration disclosed Tuesday it may announce the framework of a pact to rescue the teetering Pacific Gas and Electric Co. next week. Things are going very well said Steve Maviglio a spokesman for Gov. Gray Davis. The state appears to be poised to pay at least $7 billion -- and possibly billions more -- for PG&E's high-voltage transmission lines as part of a deal to financially renovate the north-state utility according to sources familiar with the negotiations. But consumer advocates insisted that even the $7 billion price is too much to pay. And experts warned that a deal with PG&E will be more complex than with other utilities. PG&E representatives declined comment in keeping with their policy on the talks even though the Davis administration said an announcement could come as early as next week or the following week. The new timetable for an announcement was substantially sooner than in Davis' original forecast. Until late last week PG&E was still resisting the sale of its power grid despite the fact that Davis had announced the framework of an agreement with Southern California Edison. Davis expects to soon announce a similar deal with the San Diego Gas and Electric Co. However any such deal still would need federal approval. The investor-owned utilities trapped between high wholesale costs and lower regulated retail rates amassed nearly $13 billion in debts and were unable to buy electricity this winter. With the onset of rolling blackouts the state began brokering billions of dollars in emergency short- and long-term power purchases. Davis' strategy to ease the energy price and supply crisis includes bolstering both conservation and generation while fiscally refurbishing the nearly bankrupt utilities. As part of the rescue deal the utilities would have to drop legal actions seeking dramatically higher electricity bills environmentally shield wildlands they own sell power from their generators to Californians for the next decade and secure help with their debts from their parent companies. Together with the cash infusion from the sale of their power 26000-mile power grids the utilities would be allowed to sell bonds to raise funds and use customer money to pay them off. The state would upgrade the high-voltage lines and lease them back to the utilities for operation. In a reflection of the negotiations with the three utilities a Davis administration official said the deal with PG&E is proving to be more complex than with the other firms. Though PG&E finally agreed late last week to sell its transmission grid the utility apparently wants more than the $7 billion that Davis has offered according to sources. The figure is more than twice the book amount or the value placed on the system for purposes of accounting. And that's the markup that lured Edison into an agreement to sell its smaller portion of the transmission grid for $2.8 billion. But PG&E which fears an erosion of its economic base may be asking as much as $10 billion. Due to complexities in the state's 1996 deregulation of the industry PG&E is more likely to lose revenue than Edison as a result of selling its transmission lines according to experts. Big customers might be able to bypass the utility's remaining local distribution lines thereby eroding its customer base. Therefore the utility may view bankruptcy and sale of its transmission lines to the highest bidder as a potentially attractive alternative to selling its share of the grid to the state at too low a price. ---- El Paso Energy closes six valley power plants Filed: 03/07/2001 By CHIP POWER Californian staff writer e-mail: ppower@bakersfield.com El Paso Energy citing non-payment from Pacific Gas & Electric Co. said it has shut down six cogeneration plants this week. The smaller plants produced about 175 megawatts of electricity and are located primarily in the San Joaquin Valley said company spokesman Mel Scott. A megawatt can supply power to 1000 homes. At least 10 plants have closed in the past two weeks as a result of non-payment according to the state Independent System Operator which manages most of the state's electrical distribution. The El Paso Energy plants are operated with various partners and had not been compensated for December January and February deliveries said Scott. He said he did not know the total amount due but said the plants would be closed until PG&E's credit worthiness is improved. A cogeneration plant common in oil fields simultaneously produces heat energy and electrical or mechanical power from the same fuel in the same facility. Typically it produces electricity and steam which can be deployed to enhance oil recovery. Kern County is the state's leading oil-producing county. El Paso owns or has interests in more than 40000 miles of interstate and intrastate pipeline connecting the nation's principal natural gas supply regions to the five largest consuming regions in the United States namely the Gulf Coast California the Northeast the Midwest and the Southeast. El Paso closed up 99 cents on Tuesday or 1.4 percent at $71.49. The Houston-based company's stock price has ranged between $36.31 and $75.30 in the last 52 weeks. ---- Still undecided: Who'll pay DWR for electricity By Karen Gaudette ASSOCIATED PRESS SAN FRANCISCO -- The price tag is $3.2 billion and counting for electricity bought by the state Department of Water Resources for the customers of two nearly bankrupt utilities. Pacific Gas and Electric Co. Southern California Edison and the state disagree over how the DWR eventually will be reimbursed for its purchases on the expensive last-minute power market. So do the state power regulators who have the final call over who gets the money when. Under a recent law the DWR went into the electricity-buying business to help keep the two utilities from sinking further into their $13 billion debt. The state plans to retrieve the money by selling $10 billion in revenue bonds. The utilities continue to collect ratepayer dollars on that electricity which the bill's author Assemblyman Fred Keeley D-Boulder Creek says is meant to help them begin paying down their debt. In a recent letter however DWR officials requested that the state Public Utilities Commission order that a portion of that money be diverted to the state. But after the utilities subtract the costs of generating electricity payments to environmentally friendly power plants and other expenses there is no money left from ratepayer dollars to give to the DWR without sinking further into debt PG&E spokesman Ron Low said Tuesday. If it passed along money to the DWR our undercollection would grow by about $2.4 billion by the end of the year Low said. The commission unable to agree on the best course of action left the issue untouched at its last meeting but expects to revisit the issue when it meets this morning. Commissioner Richard Bilas is proposing an alternate plan that would have the DWR set its own revenue requirements that would be passed on to ratepayers. The PUC also is expected to respond to complaints from laid-off workers and customers that layoffs by utilities to cut costs have been hurting service. Commissioner Carl Wood warned at the last meeting that failure to provide safe and reliable service could mean fines for the utilities. Representatives from electrical workers unions the PUC and the utilities were to discuss the issue Tuesday afternoon. I don't think we believe that utilities can find a way out of their problems by laying off workers said Mindy Spatt a spokeswoman with the Utility Reform Network. We think consumers deserve safe and reliable service and we think they deserve it at a reasonable price. ---- State Taxpayers In Dark on Details Of Energy Deal David Lazarus Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle Few people would purchase a car simply because the dealer said ''Trust me it's a great deal.'' Yet Gov. Gray Davis essentially is telling Californians just that about dozens of long-term power contracts. Because of confidentiality agreements with power companies the governor has revealed only scant details about the state's multibillion-dollar contracts for electricity over the next 10 years. Gov. Davis has our money and we can't see how he's spending it said Doug Heller a spokesman for the Foundation for Taxpayer and Consumer Rights in Santa Monica. We've been locked out of the room. Neither Davis nor power companies would divulge specific details about the price duration or scope of individual contracts. Each cited secrecy clauses that the governor's office said had been desired by both sides. What consumers do know is this: -- California has signed 40 contracts and tentative accords valued at about $40 billion to secure enough power to light 9 million homes over the next decade. -- The average purchase price of each deal is $69 per megawatt hour -- well above the $30 to $40 charged by power generators before California's energy market went haywire last summer. -- If as is widely expected wholesale power prices fall in years ahead the state nevertheless will be locked into paying above-market rates for electricity. But it is not known which generator agreed to part with the most power at the cheapest level or the full range of the prices in concocting the $69 average. Moreover it is unclear how shrewdly the state negotiated with taxpayer money in securing power on behalf of cash-strapped utilities. These agreements are the bedrock of our long-term energy policy Davis said Monday in announcing the deals. The governor's office defended the murky nature of the contracts yesterday. It's a business transaction in which private corporate information is included said Steve Maviglio a spokesman for Davis. That's the kind of information that never gets revealed. While additional elements of the contracts will be publicized in coming months he said the contracts themselves will remain a secret. You'll never see all the details Maviglio said. This did not sit well with many observers. It's a breach of public trust said Daniel Bacon a San Francisco attorney specializing in business law. A public servant spending public money shouldn't be able to keep the spending secret. But Gary Ackerman executive director of the Western Power Trading Forum an energy-industry association in Menlo Park called confidentiality agreements a necessary evil in transactions like this. He explained that no power company would agree to a long-term contract if rival firms could learn the terms of the accord. The company would be losing too much of its competitive edge in the marketplace Ackerman said. At the same time he noted that secrecy allowed the buyer -- in this case California taxpayers -- to secure more favorable terms with individual sellers. A high price with one generator would not necessarily be sought by all power providers. Still the fact that public funds are being used makes confidentiality in this case a different matter than say Cisco Systems' quietly negotiating to take over yet another tech rival. The public is in a very awkward position said Michael Shames executive director of the Utility Consumers' Action Network in San Diego. It has to rely on the good word and expertise of the governor and he has yet to demonstrate that he has expertise or good word in this field. Shames likened consumers to passengers in a plane being flown by a pilot without a license to fly. But what choice do we have? he asked. I don't see many other options available right now. There's the rub. No matter how bad a deal California may have cut to help meet its energy demands the alternative -- blackouts disruptions economic catastrophe -- is far far worse. On the other hand it already appears that the new contracts will not shield Californians from the threat of daily outages this summer when demand surges. Davis said only about 60 percent of the state's summertime electricity needs so far had been met. Part of the reason is that many power companies already have contracted for their output this year. Duke Energy said this was why it would not begin its nine-year contract with California until 2002 while Williams Cos. said it would only gradually increase the amount of available wattage in its 10-year contract. Both companies meanwhile will continue to profit this summer by selling into the volatile spot market where wholesale power went for as much as $1 500 per megawatt hour last year. You can't sell all your power into long-term contracts said Paula Hall- Collins a Williams spokeswoman. You save some for the spot market. Consumer groups worry that consumers will be hammered again this summer with sky-high power prices and then get nailed down the road by contracts for above-market rates. If we could look at the terms of the deals we'd see that California is being gouged for 10 years said Heller of the Foundation for Taxpayer and Consumer Rights. But the governor doesn't want us to see that. Ackerman of the Western Power Trading Forum said the state had gotten the best rates it could under current market conditions. California went for long-term contracts when everyone else moved in as well he said. Californians are paying a price for not acting sooner. ---- Lawmakers pitch fixes for region's energy woes By David Whitney Bee Washington Bureau (Published March 7 2001) WASHINGTON -- California members of Congress pleaded for everything from wholesale price caps to extending daylight-saving time an extra hour to help the region cope this summer with its persistent electricity shortage but none of the ideas seemed to catch fire at a House hearing Tuesday. People will die in California because of this crisis Rep. Brad Sherman a Los Angeles-area Republican warned the House Energy and Commerce Committee. Sherman testified that his idea for saving lives is to extend daylight-saving time by an extra hour so that there would be more daylight at the end of the day when power consumption surges. One of the peak demand periods for electricity occurs between 5 p.m. and 8 p.m. when the sun sets and people come home from work Sherman testified. If people come home and it is light out there is less of an inclination to turn a light on. Sherman said the state Legislature has called for congressional approval for states to be given authority to extend daylight-saving time and he cited analyses by the California Energy Commission and other agencies suggesting that it could cut power consumption by 1 percent to 2 percent. Sherman who was one of about a dozen California lawmakers presenting their views on the energy squeeze drew no questions from committee leaders about what his legislation might do to everything from airline schedules to television programming if West Coast states didn't agree on the same time standard. Most of the committee's questioning was on the more popular idea proposed by several California and Western lawmakers primarily Democrats to require the Federal Energy Regulatory Commission to impose caps on wholesale electricity prices that have gone wild because of a regional power shortage. Rep. Bob Filner D-San Diego charged that the price spiral has little to do with power shortages but a lot to do with a small cartel of generators bilking ratepayers. Rep. Jay Inslee D-Wash. said he brought up the idea of regional price caps with President Bush who was initially skeptical. But Inslee said that Bush warmed to the idea after being told that protections could be built into the caps so as not to discourage construction of new power plants. Upon hearing that Inslee said Bush invited him to meet with the president's Cabinet-level task force led by Vice President Dick Cheney on a national energy strategy. But Inslee said he can't get the group to meet with him. It's very disappointing Inslee said. Tuesday's hearing was part of a series the panel is holding on the California crisis so far without any emerging consensus on what if anything Congress should do. ---- Power plan called wrong Wall Street analysts say the governor's approach to the problem avoids the issue that caused the imbalance. March 7 2001 By DON THOMPSON The Associated Press SACRAMENTO California's scramble to insulate consumers from the soaring price of electricity may add to the state's power problems this summer Wall Street analysts said Tuesday. Gov. Gray Davis' emphasis on buying utilities' transmission lines and negotiating long-term power contracts to help ease their debts skirts the deep imbalance between wholesale and market rates that led to the state's power problems in the first place they said. In the long run it doesn't solve anything said Michael Worms an industry analyst for Gerard Klauer Mattison & Co. In the long run you need to send the right price signals to consumers which will create its own conservation signals. Unfortunately customers were shielded from that in California. Davis said Monday that the state's first contracts to buy electricity for two financially struggling utilities will provide only about two-thirds of the power needed on a typical summer day forcing Californians to cut power use at least 10 percent to avoid blackouts. Since early January the state has been buying one- third of the power Southern California Edison and Pacific Gas and Electric Co. customers need. The two utilities denied credit by suppliers say they have lost nearly $14 billion due to soaring wholesale electricity prices that the state's industry-deregulation law says they cannot pass on to consumers. The keepers of the state power grid had enough electricity Tuesday to avoid declaring an electricity alert but have faced an almost-daily scramble for weeks due to a tight supply and high wholesale prices. Several wholesale and retail rate proposals are circulating. Among them: Free-market advocates such as Worms want an immediate end to the deregulation-imposed retail rate freeze on Edison and PG&E that will expire next year. Davis wants a Western price cap of $100 per megawatt hour on power generators he says have been prof iteering from California's short energy supply. The Bush administration and Federal Energy Regulatory Commission are cool to that idea. In December FERC imposed a soft cap of $150 per megawatt hour on wholesale rates in the state and required suppliers to justify any higher prices they charge. Consumer groups such as The Utility Reform Network or TURN want regulated rates for residential and small-business customers but free-market rates for large industrial customers which sought deregulation in the first place. TURN also advocates a tiered rate structure with higher rates for consumers who use more than a reasonable amount of electricity each month. Assembly Republicans say electricity and natural-gas prices will fall naturally if the state increases supply mainly by making it easier to build plants and pipelines. Right now you're sort of sitting partially with regulation and part with the free market said Paul Fremont an analyst with Jefferies & Co. Both these systems work. It's sort of that in-between system that you have in Califor nia that doesn't appear to be working. The system discourages generators from building new power plants because they aren't guaranteed a profit and it doesn't do enough to discourage power use by consumers because the price they pay doesn't reflect the true cost of power Fremont said. I don't think people here have much faith in the market and why should they? countered TURN's Mindy Spatt. I think there are probably better ways of encouraging consumers to conserve than by gouging them. Davis insists the crisis can be resolved without raising rates for Edison and PG&E customers beyond the existing rate structure. In January state regulators imposed temporary rate hikes of 7 to 15 percent on Edison and PG&E customers. The Legislature and Davis extended the increases for up to a decade to help pay back the estimated $10 billion in power buying the state expects to do for Edison and PG&E over the next several years and finance its purchase of the power lines owned by the two companies and San Diego Gas & Electric. Rates were already scheduled to increase next year for Edison and PG&E customers. Under the 1996 deregulation law the pair's ratepayers saw a 10 percent rate reduction but only until early 2002. That rate cut will likely expire as planned Davis spokesman Steve Maviglio has said. Davis wants those rates to cover not only the traditional cost of generating transporting and distributing power but the added cost of paying off the two utilities' massive debt and buying their transmission lines said Assemblyman Fred Keeley D-Boulder Creek the Assembly's chief power negotiator. Yet Davis has indirectly addressed the rate imbalance by signing legislation that will let regulators raise consumer rates if necessary Keeley said. The governor and lawmakers are in effect spreading out rate increases over a decade by using long-term revenue bonds to buy power for the nearly bankrupt utilities said Severin Borenstein director of the University of California Energy Institute. At some point we have to deal with the reality that all of the power that we buy has to be paid for by somebody - it's either going to come from taxpayers or it's going to come from ratepayers Bor enstein said. Raising rates now would get us a lot of conservation. Davis also wants financial incentives for conservation and power-plant construction in time to make a difference this summer. Our mouths were agape at the rapid timetable Keeley said. Legislators are rushing to pass those incentives by month's end he said allowing three months for consumers and suppliers to act before the heat of summer. Among bills considered Tuesday the Senate Energy Committee approved legislation to accelerate the siting of power plants. It also was considering a proposal to restructure rates for generators that use renewable energy to provide about 30 percent of the state's electricity. ---- Bill to Cut Some Power Prices Stalls Energy: Democrats balk at varying payment levels for alternative generators. By DAN MORAIN JULIE TAMAKI Times Staff Writers SACRAMENTO--Legislation aimed at cutting prices for more than a fourth of the power consumed in California stalled Tuesday as Democrats questioned why a few alternative energy generators--some of them campaign donors--stood to receive higher payments than others. Lawmakers working to unravel California's energy mess have been negotiating for weeks in an effort to cut the price paid to more than 600 generators of alternative power by more than half to below 8 cents a kilowatt-hour. Those alternative generators' contracts with utilities have shot up in recent months because of a rise in the price of natural gas. The cash-strapped corporations have suspended or made partial payments to the generators over the last few months causing many to shut down or reduce their outputs. But even as the lawmakers reached agreement that pushed the average price to near the 8-cent level per kilowatt-hour some generators would have received higher prices under the bill by state Sen. Jim Battin (R-La Quinta). Some of the generators that stood to benefit had donated to Battin's campaigns. One--Windtec Inc.--gave Battin a $20000 campaign donation in 1999. Others contributed from $3000 and $5000 last year. Battin acknowledged that he has received campaign contributions from some wind power generators but said there is no connection between the donations and the bill's provisions. It is illegal it is unethical and it's not how I do business he said. Battin noted that 25% of the state's alternative energy producers are in his district. As Democrats on the Senate Energy Committee blocked the bill Battin warned that some alternative energy producers might react to the delay by trying to force Southern California Edison and Pacific Gas & Electric into bankruptcy. We will be the cause of bankruptcy Battin said. That prompted Energy Committee Chairwoman Debra Bowen (D-Marina del Rey) to retort: I'm really tired of being threatened with bankruptcy. Alternative energy producers including those that use wind solar power biomass and other means produce 27% of the energy used in California. They sell the electricity to the utilities which in turn transmit it to retail consumers. But with the utilities facing multibillion-dollar debts the alternative energy producers under contract with Edison have not been paid since November. Scores of alternative energy producers supported the measure. Edison International and the San Francisco-based consumer group the Utility Reform Network opposed it. Michael Florio of the Utility Reform group said the deal could result in higher consumer prices an Edison representative said the same thing. Battin and Assemblyman Fred Keeley (D-Boulder Creek) worked out an arrangement with many of the generators. Keeley took the lead in the early negotiations and then turned to Battin to introduce the legislation SB 47X. Rather convoluted language would have allowed higher payments to a select few generators that produce electricity from wind and biomass. Most of California's wind suppliers for instance would have received about 6 cents per kilowatt-hour. But a handful of them about half a dozen wind farms--mostly in the Palm Springs area represented by Battin--would have received 7.8 cents. Battin contends that other wind producers receive additional payments that boost them to the same level as Windtec and others that would get the higher payments. They get the same deal Battin said of the handful of generators that would benefit from the provisions he added to the bill. In California's overall energy market the amount of money that would have flowed to the favored generators is minor. But the added prices that would have been paid to the generators would have translated to at least $19 million in the next five years to be absorbed by Southern California Edison customers according to one analysis. Also Tuesday more details were disclosed about another leg of the state's effort to escape from the energy crunch--the deals with large power generators to supply electricity to California for as long as 10 years. Those arrangements were announced by Gov. Gray Davis Monday as the bedrock of California's energy policy. But some consumer advocates warned that the deals could lock the state into excessively high-priced contracts. S. David Freeman the general manager of the Los Angeles Department of Water and Power and Davis' negotiator said that the state guarded against that by varying the time spans of its deals. About 6000 megawatts are expected to be available this summer about one-third of the energy needed by the state Freeman said. The amount of power under contract swells until more than 9000 megawatts are contracted in 2004 half of the needed amount before dipping to 8000 megawatts in 2010. What we're doing here is what everybody said had to be done Freeman said. We deliberately bought 50% so we'd have a good mix between long-term contracts which may turn out to be somewhat higher or somewhat lower than the spot market and purchases on the spot market. ---- PG&E could face mutiny on outages: SMUD others may balk if utility orders summer blackouts By Carrie Peyton Bee Staff Writer (Published March 7 2001) Sacramento's electric utility wants out of a deal that imposes rolling blackouts locally on PG&E's command. So do a lot of other utilities. They've been writing letters lobbying lawmakers and launching informal talks with Pacific Gas and Electric Co. to get off the hook before summer. Who dodges the blackout bullet is going to play out as a political hot button around the state said George Fraser head of the Northern California Power Agency a coalition of municipal utilities. In Sacramento the next volley is expected soon with the Sacramento Municipal Utility District reportedly poised to notify PG&E that it will no longer black out homes and businesses on the larger utility's command. We are absolutely trying to fight off the requirement for rolling blackouts for the Sacramento area said Linda Davis one of seven elected members of the SMUD board of directors. Saying they don't want to be dragged down by somebody else's problems two Southern California utilities have written grid operators asking to be exempted from any blackouts caused by PG&E's or Southern California Edison's financial woes. But in PG&E's view California is in an energy crisis (and) ... we're all in this together said spokesman John Nelson. The maneuvering comes amid bleak forecasts for power supplies this summer. Although Gov. Gray Davis has said conservation new power plants and moderate weather could avert blackouts officials at the Independent System Operator which runs much of California's grid expect frequent rotating outages. One consulting firm Cambridge Energy Research Associates predicts 20 hours of rolling blackouts during July and August and about 200 hours of especially intense calls for voluntary cutbacks. Before blackouts hit the jockeying over just whose lights air conditioners and assembly lines will be shut down is growing. The outcome could affect millions of people statewide. The state Public Utilities Commission is probing rolling blackout programs run by the for-profit utilities it regulates including PG&E and Edison. A PUC analysis has suggested that PG&E's program which currently exempts about 40 percent of its customers should spread the burden more broadly. For example it said 1.9 million homes and businesses are spared just because they share a circuit with a customer deemed essential. But not-for-profit utilities such as SMUD which answer to their own elected boards or city councils have other worries. Many have already lined up their power supplies for summer. Some have raised rates or are considering raising rates. Some have taken extra conservation steps. They think those preparations ought to give them leverage to ease blackout clauses in their contracts with PG&E. SMUD general manager Jan Schori is going to use every avenue ... any avenue to put pressure on including lobbying the ISO the governor and others said utility director Davis. The Northern California Power Agency a joint-powers authority that owns and operates power plants for municipal utilities has begun informal negotiations with PG&E to change blackout rules according to Fraser its top executive. It is preparing to write PG&E asking that its members be exempted from outages altogether. Failing that it wants them to face fewer outages or to be compensated for cutting off power he said. At SMUD the utility board has met in closed session to discuss exactly what it is required to do during electric emergencies under terms of the interconnection contract that links SMUD's lines to PG&E's. The contracts are being inspected with a fine-tooth comb said SMUD director Howard Posner. Schori declined to comment on any specifics. Sources indicated that the main option being considered is notifying PG&E that because of changed circumstances SMUD believes it no longer is required to routinely comply with outage requests. Other options being explored include re-negotiating existing agreements with PG&E. Posner said that ever since two days of rolling blackouts in January constituents have been asking him 'Why are we participating when we're not the problem?' And I don't have a good answer to that. Several directors said SMUD has already spent a lot of money -- and is considering 16 percent rate increases -- to ensure that it has enough electricity under contract to meet its customers' summer demands. They believe PG&E should do the same. We're almost like a David against Goliath here said board vice president Genevieve Shiroma. The huge investor-owned utilities next door have severe problems that they need to get under control. In addition SMUD plans to argue that because it can cut usage through its Peak Corps program which remotely turns off air conditioners at volunteer households it has already done its part without rotating outages director Davis said. PG&E believes the interconnection agreements that govern smaller utilities' ties to its transmission lines have benefits and burdens to both sides said Nelson. It wouldn't be fair or good policy for just one provision to be altered without taking a look at how that affects the entire contract he said. Interconnection contracts generally have clauses that require utilities to help each other out to avert greater emergencies. Sometimes reducing demand -- called load shedding -- can be the only way to stabilize the electric grid in the seconds after a major power plant or transmission line fails. It's been around in the electrical fabric forever said Jim Pope head of Silicon Valley Power Santa Clara's city-run utility. In addition to legal requirements you have a moral obligation so you don't bring the system to collapse. Like other city-run utilities Silicon Valley Power has a contract with PG&E that requires it to shed load during an electric emergency. But its contract allows it to work with big users to reduce their demand so no one has to be completely shut off. Such agreements formed long before deregulation when PG&E ran the north state's grid now are complicated by the 1997 creation of the state Independent System Operator. The ISO today runs pieces of the grid owned by PG&E Edison and San Diego Gas & Electric Co. If it believes power use is about to surge past supply potentially triggering a grid collapse across the western United States the ISO notifies the three utilities that they have to shed a certain number of megawatts. The big utilities meet that requirement two ways. They cut circuits to some of their own customers and they tell smaller connected utilities to cut a proportionate share. In Northern California about 80 percent of the outages are borne by PG&E customers and the rest by customers of SMUD and other municipal utilities and irrigation districts. In one sense we are all in this together. If SMUD were in danger of going down we would hope others would help us out said SMUD's Posner. But that's if we're in danger from circumstances beyond our control not from mismanagement or lack of financial wherewithal. It is unclear what penalties if any a utility would face for violating an interconnection agreement. In the long run the issue would be fought either in the courts or before the Federal Energy Regulatory Commission grid officials said. As a practical matter in the seconds when the risk to the grid is greatest if one utility refused to shed load the ISO would probably solve to problem by calling on PG&E Edison or others who are willing to make deeper cutbacks they said. ---- PUC to Decide Fate Of Utility Workers PG&E Edison want to trim costs by laying off thousands cutting service Bernadette Tansey Chronicle Staff Writer Wednesday March 7 2001 2001 San Francisco Chronicle State regulators are set to decide today whether debt-ridden Pacific Gas and Electric Co. and Southern California Edison can conserve cash by laying off thousands of workers and letting service standards slip. Union officials who protested the layoffs before the California Public Utilities Commission warn that if the cuts go through neighborhoods hit by power outages could stay dark for hours and more customers could face busy signals when they call about their bills. An administrative law judge agreed advising the commission in February to order the utilities to restore 725 positions already cut and block the elimination of an additional 2125 jobs. Judge John Wong said PG&E and Edison have acknowledged the layoffs will not substantially improve their shaky financial condition which arose from skyrocketing wholesale electricity costs the utilities could not pass on to consumers under a rate cap. The savings would barely make a dent Wong said in his draft decision. The two companies together claim that their debt from power purchases amounts to more than $13 billion. PG&E says it has saved $18 million from the first wave of 325 layoffs. Wong's recommendation is already running into resistance on the PUC. Commissioner Richard Bilas said the five-member panel should not be micromanaging the utilities in a time of crisis. Bilas has proposed an alternate ruling that would allow the utilities to make the cuts but provide for PUC monitoring of service in case the commission wants to step in later. We're in a situation where the utilities are not collecting the revenues they need to operate and yet we may be guilty of not letting them cut expenses where they can cut expenses Bilas said. PG&E spokesman Jon Tremayne said savings from the layoffs are helping to keep electricity running and gas flowing. It keeps cash in our accounts so we can keep doing day-to-day business Tremayne said. In addition to the 325 positions dropped so far PG&E is proposing to cut an additional 675 during the next three to six months. The cuts affect temporary and contract workers who read meters handle new service hookups and replace equipment. PG&E has no plans to eliminate permanent positions. The company is struggling to keep up with a higher workload at its call center as customers deluge the lines with inquiries about their rising bills and the effects of deregulation. Calls to PG&E ballooned from 1.3 million in January 2000 to 2.3 million in January 2001. Bilas advocates granting PG&E's request to temporarily relax standards requiring the utility to respond swiftly to customer calls and to read customers' meters once a month. PG&E wants to read meters bimonthly and send bills based on the estimated use between readings. Discrepancies could be corrected later. Wong called those measures unacceptable. He said customers need to know immediately if their efforts to conserve power are working. Wong also said the utilities' own experts have said the workforce reductions will lengthen the time required to restore power after nonemergency equipment failure. Eric Wolfe communications director for the International Brotherhood of Electrical Workers Local 1245 said some customers have already been left without power overnight because PG&E is trying to avoid the use of overtime on nonemergency power outages. It hurts a lineman to walk away from the job leaving a customer without power Wolfe said. Tremayne said PG&E is trying to minimize overtime costs but denied the company has allowed customers to go without power out of financial concerns. He said crews were pulled out when darkness and falling trees made the work too dangerous. ---- Power prices could soar during the summer Posted at 10:35 p.m. PST Tuesday March 6 2001 BY STEVE JOHNSON Mercury News Unless Gov. Gray Davis arranges significantly more long-term electricity contracts or persuades people to turn off a lot more lights California's unpredictable spot market for power could wreak havoc this summer. Even with the 40 long-term deals announced by Davis on Monday experts interviewed Tuesday said up to 43 percent of the state's daily needs may have to come from this highly volatile market in which power is bought within a day of need. That could could prove hugely expensive because some spot market energy has cost five to six times what it would under the long-term contracts. It's widely expected that consumers ultimately would have to pay that tab which could amount to billions of dollars. And because that power won't be locked up in contracts there is no guarantee it will be available when it's needed which could lead to blackouts according to a recent report to the California Independent System Operator which oversees three-fourths of the state's power grid. ``The situation in California could reach catastrophic proportions'' the report concluded adding that unless things change dramatically ``it is a virtual certainty that peak demand will go unmet during many hot summer days.'' Steven Maviglio Davis' press secretary conceded Tuesday that the spot market could be troublesome. ``It's a major concern'' he said which is why the state is trying to line up more power contracts speed up power plant construction and promote conservation. During the normally hot month of August peak daily demand for power in the Independent System Operator's territory is expected to hit about 47700 megawatts -- enough for nearly 48 million homes. The state's three main utility firms generate about 8200 megawatts and have long-term contracts from wind solar and other energy sources for about 11700 megawatts more. That totals about 20000 megawatts. Add in the 7000 megawatts of long-term power that Davis has announced for this summer and the state is still nearly 21000 megawatts short. Costly proposition If all that power has to be obtained on the spot market the price could be high. On Friday last-minute purchases on the market averaged $411 per megawatt-hour compared to about $150 per megawatt-hour for all power obtained by the Independent System Operator and $69 per megawatt-hour on average under Davis' long-term contracts. It's possible that not all 21000 megawatts would have to be purchased on the market. Assuming Davis is successful in getting people to save 10 percent -- which could prove difficult -- conservation could reduce peak demand by nearly 5000 megawatts. California also might be able to trade for another 5000 megawatts with the federal government's Bonneville Power Administration and a hydroelectric operator in British Columbia said Arthur O'Donnell editor of California Energy Markets a trade publication. Under such deals those two outfits often send that much power to California when they don't need it and California returns the same amount or more when its demand is low. But O'Donnell said it wasn't clear whether 5000 megawatts would be available this summer because ``they still haven't gotten the snowpack they need in the Pacific Northwest'' which could limit that region's generating capacity. Still falling short Even if those hydropower imports are available and conservation works as Davis hopes it's likely California would still require the spot market for 11000 megawatts to meet the August demand. That's more than 20 percent of the state's overall power needs. ``All of the surrounding states are buying probably less than 5 percent at most of their energy on the spot market'' said Frank Wolak a Stanford economist who monitors electricity prices for the Independent System Operator. He worries about how much that power could cost and is disturbed that state officials haven't adequately addressed the issue. ``No one has any idea what they are going to do and that is part of the problem'' he said. Officials at Pacific Gas & Electric Co. are particularly concerned. They fear that their company -- which is nearing bankruptcy -- could get stuck for much of the spot market purchases by the Independent System Operator which has threatened to bill the utilities for the cost. Fearing the annual bill for that power could hit $2.4 billion this year PG&E wants the tab sent to the Department of Water Resources which also is buying power on the spot market for the state. But the Department of Water Resources has objected to that idea and the matter is expected to be heard today by the California Public Utilities Commission. ``We're looking for clarity on a number of issues'' regarding how the spot market will work ``and certainly that's one of them'' said Thomas Hannigan the water agency's director. ``I don't think anybody knows the answer of who's going to pay for it'' added PG&E spokesman John Nelson. But Nettie Hoge executive director of the Utility Reform Network in San Francisco said she suspects consumers ultimately will foot the bill. The unfortunate likelihood about spot market purchases is that ``ratepayers are responsible for all of it eventually'' Hoge said. ``It's a very big problem.'' ---- Power Plant Plans Cause Conflicts East county residents blast supervisors Jason B. Johnson Chronicle Staff Writer Wednesday March 7 2001 Industry dreams of building new power plants in east Contra Costa's hills are prompting an angry reaction among residents and elected officials who say they don't want more plants. The conflict was sparked by a vote by county supervisors yesterday to aggressively explore possible sites for new power plants throughout the county. The measure by Supervisors Mark DeSaulnier and Federal Glover which passed on a 4-to-0 vote directs the county administrator and Department of Community Development to compile a report on possible sites within 45 days. Supervisor Donna Gerber abstained after criticizing the plan for potentially repeating the same mistakes that plagued the state's energy deregulation effort by not considering how much energy the state region and county will need in future years and how much power is slated to come online. Gerber said alternative power sources such as solar should also be examined. A site drawing much attention is on top of a deposit of natural gas near the Concord Naval Weapons Station off Highway 4. The owners of 70 acres of land near the station recently formed a company Golden State Power Co. to pursue construction of at least one small peaker plant and a much larger facility capable of producing 600 megawatts. The site could hold up to three small 50-megawatt peaker plants and a larger 15-acre natural gas plant said Steve Thomas managing partner with Golden State. No land use applications have been filed. Thomas said 30 acres could be kept as open space to form a buffer around the project. Both (facilities) are state of the art said Thomas. We believe that the site is ideal. But east county residents at yesterday's meeting blasted the supervisorial measure and the power plant proposal complaining that more plants could put people's health at risk. The region already is home to six power plants. We're going to get a good dose of poor air quality and (negative) health conditions from this said Concord resident Evelyn Frietas. I think we need to stop and think about what we're doing to our quality of life. Dan Torres said the home he bought in 1995 at a new Bay Point development would be alarmingly close to the proposed Golden State site. It will be dragging emissions over our home said Torres. I didn't buy a home on that hill to be surrounded by power plants. There are six power plants in operation in east Contra Costa. Pittsburg already has two power plants and two more under construction. City Council members Frank Aiello and Yvonne Beals said the Antioch-Pittsburg area has done more than its share of energy production. Aiello said Pittsburg will soon produce enough energy to power three million homes in California. When is enough enough? asked Aiello. Pittsburg has shouldered responsibility for a land-fill and two more power plants. At some point you have to say enough. Beals said that while power plants have added millions to the city's general fund the negatives of additional plants could outweigh the benefits. I don't think that Pittsburg or east county should be the dumping ground for energy for California said Beals. ---- Supervisors set search for power plant sites The board also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord By Thomas Peele TIMES STAFF WRITER MARTINEZ -- Contra Costa County supervisors took tentative steps Tuesday toward allowing the construction of at least one small power plant before summer ordering that its staff identify potential sites in unincorporated areas within seven weeks. The board voted 4-0 to search for locations. Third District Supervisor Donna Gerber abstained saying her colleagues lacked a comprehensive context'' to identify sites. I think the board knows just enough to be dangerous'' she said. Gerber said the county should examine the potential for additional power plants within its borders but not investigate individual sites yet. But Fourth District Supervisor Mark DeSaulnier said the action was necessary because of the energy crisis and because of Gov. Gray Davis' call for local governments to help speed the construction of so-called peaker plants before July and August. I wouldn't do this except under an emergency DeSaulnier said after the vote. There are unusual circumstances. We're not talking about putting this in a residential area. Fifth District Supervisor Federal Glover backed DeSaulnier but said he hoped for a location outside his heavily industrialized East County district. There's a lot of concern in East County as to the number of plants he said. DeSaulnier said though that the only logical place for a small plant remains the industrial belt'' stretching along the waterfront from West County to Antioch. He declined to provide specifics but said the only other potential site outside the industrial areas was the Concord Naval Weapons Station property. But he quickly added that he believes the U.S. Department of Defense would never go for it. Also DeSaulnier said he could not rule out the county building the plant itself and entering the electricity-selling market during peak demand times. Board Chairwoman Gayle Uilkema called that idea extremely premature and unlikely. That's a very powerful decision. I do not think we are ready'' she said. The California Energy Commission listed the Equilon refinery in Martinez as one of 32 potential peaker plant sites in the state last week. Peaker plants kick in during peak usage times. Davis called for their quick construction before the height of summer and its energy demand for air conditioning. Plants that generate as much as 50000 megawatts don't need Energy Commission approval. DeSaulnier said he believed a peaker plant could be built about a month after final approval. Supervisors also heard from the potential developers of a 650-megawatt plant between Bay Point and Concord. Walnut Creek commercial real estate developer Steve Thomas announced his intentions for the site north of Highway 4 last week. Construction could take two years. Eric Hasseltine a consultant representing Thomas and what he described as a brand new company for the site the Golden State Power Co. told supervisors that if they intended to speed peaker plant construction they should do what they can to expedite the larger plant. The Thomas site could house a peaker plant until the proposed larger one goes online. A large natural gas line passes under the site. DeSaulnier seemed cautious about the larger proposal which he had described last week as a good site. Uilkema too said she knew too little about it to comment. A resident who lives near the Thomas property asked the board to build it (the larger plant) closer to where you have industrial areas. You have to carefully consider the people who live nearby said Dan Torres 39. Evelyn Freitas of Concord said she lives downwind of the proposed site. Our air quality is going to be worse then it is now she said. Gerber played on the environmental issues saying the county already ranks second statewide to Los Angeles in volume of hazardous materials and amount of electrical generation. ---- Peter Schrag: California's $90 billion infrastructure gap (Published March 7 2001) By now California's surreal energy mess has grown from a crisis to a condition. It may not be quite as permanent as say death and taxes but it's still something that could get a whole lot worse before it gets better. Until there's more realistic pricing no gubernatorial pea-under-the-shell buyout scheme will solve it. Beyond the energy crisis however and in many ways similar to it California faces a whole range of other infrastructure problems -- in transportation in water resources and sewer systems in school and university buildings -- that seem once again to be all but forgotten. The Business Roundtable has estimated the need at roughly $90 billion though no number can possibly be exact. What's certain is that after a burst of high-level investment in public facilities during the 1950s and 1960s California's annual capital investment has sunk precipitously -- from an annual $150 per capita in the 1960s according to a set of recent studies for PPIC the Public Policy Institute of California to about $30 in the 1990s. But you probably don't need to tell anyone driving Bay Area or Los Angeles freeways or looking at the ubiquitous portable classrooms those dreary brown boxes that house a fourth of our public school students. Ever since passage of Proposition 13 in 1978 we have been flying the flag of deferred maintenance. As in the state's electricity crisis however there's no way California can effectively address those problems merely by building or bonding itself out of them. In highway construction in developing water resources in finding enough university space to accommodate the Tidal Wave II of students managing demand is likely to be as crucial to any solution as new construction. In the energy market -- and in electricity particularly -- it's been a familiar principle ever since David Roe of the Environmental Defense Fund first persuaded Pacific Gas and Electric that a dollar invested in conservation may be worth as much as the same investment in new generation. But in most other sectors of California's infrastructure state and local it's a lesson still to be learned. There have been scattered attempts to encourage conservation and reduce demand -- significant reduction in water use for example through the installation of low-flow faucets and low-flush toilets some reduction in traffic by using rush-hour diamond lanes or by adjusting highway or (as in New York) bridge tolls to levels of congestion. But as pointed out by David Dowall an urban economist at Berkeley state policy-makers have not really begun to consider how demand management strategies can be applied to infrastructure service areas or how the more efficient use of facilities and more realistic pricing -- highway tolls say or parking fees -- can reduce demand for scarce infrastructure resources. In any case says Dowall in one of the PPIC reports we should pick which major projects we will build not just according to per capita estimates of how much we need but according to how much consumers are willing to pay for them. To avoid hurting the poor congestion-related highway tolls and other tariffs can be rebated on the basis of income. University fees can be means-tested. In California they also could be adjusted to encourage summer school classes and other off-peak uses rather than (as in the past) making UC summer courses more expensive. Given the political and economic uncertainties there's no way to know how far such demand management can be taken. But there's not much doubt that as Dowall and others point out the state's infrastructure planning is a jumble of uncoordinated agency agendas and wish lists. The Legislature last year passed a bill AB 1473 by Assembly Speaker Robert Hertzberg that requires the governor beginning next year to submit an annual five-year infrastructure plan for state agencies and public schools along with recommendations on how to fund it. In addition Gov. Gray Davis' infrastructure commission is expected to recommend better coordination of infrastructure and land-use planning when it issues its report this spring. That would be a start. As California State Treasurer Phil Angelides has pointed out the state desperately needs to start joint planning -- regional planning -- for housing roads and other resources to reduce the need for long commutes to preserve open space and to bring jobs to where people live and housing to where the jobs are. That would itself reduce demand for more freeway lanes and equally important improve the quality of life. At present most planning for housing roads water systems and other facilities rarely recognizes the regional impact of local decisions. In the East Bay slow-growth forces push well-intended initiatives that would force more development into Tracy or Modesto and further tax the transportation systems to Silicon Valley. In city after city there are beggar-thy-neighbor efforts to grab yet another shopping mall that produces a little extra sales tax revenue for the city that gets it and that often compounds traffic and revenue problems in adjacent communities. In higher education we divide bond proceeds evenly among UC the California State University and the community colleges even though the community colleges serve eight times as many students as UC. We plan road projects according to county not regional priorities. It is all done according to antiquated political and fiscal formulas that often no longer make sense. We don't just need better capital planning we need a whole new planning system. ---- PG&E power plan debated at hearing A PUC meeting on the utility's capacity expansion project for the Tri-Valley follows weeks of protest from officials residents Power upgrade in valley debated By Megan Long TIMES STAFF WRITER SAN FRANCISCO -- Dublin officials and the developer of a Livermore subdivision faced questions Tuesday about their opposition to alternative routes of PG&E's controversial Tri-Valley power upgrade plan -- and answered by restating their long-standing objections. Tuesday's cross-examination came during the third and likely final week of the California Public Utility Commission's evidentiary hearings on the utility's $91 million Tri-Valley 2002 Capacity Increase Project. It has followed weeks of protests of PG&E's upgrade plans by officials and residents of Livermore Pleasanton Dublin and San Ramon. And before the questioning started Dublin Vice Mayor Janet Lockhart reiterated concerns about an alternative route deemed environmentally superior that would place a substation just 1000 feet north of Interstate 580 between Tassajara and Fallon roads. She said that would undermine the results of a 15-year process to plan the eastern development of the city. It's extremely important to the residents of our community to follow a plan we worked hard to produce she said. Dublin officials favor PG&E's proposed placement of the station three miles north of the freeway away from new high-tech company offices and housing developments. Besides the Dublin substation the project calls for construction of a substation in North Livermore expansion of the Pleasanton substation and installation of 23.5 miles of new lines. In response to questions from PUC Administrative Law Judge Michelle Cooke Dublin's public works director Lee Thompson confirmed that the Lin family the owner of the property where the alternative substation would go wasn't interested in selling the land to PG&E. Cooke also asked Thompson to define a discretionary permit which is how city officials said they might treat a permit for a substation. Lee said that type of permit is one the city has the right to approve or not depending on the project's impact. Eddie Peabody Dublin's community development director testified that the zoning for the Lin property accommodates uses such as commercial business research and development and light manufacturing. It would not he said be appropriate for a power substation. He said parcels within the East Dublin area that could host a station would include those zoned for public and semi-public uses including land recently bought by Oracle and Sun Microsystems for new campuses. While Dublin officials testified that one buyer of land in that area paid $86 per square foot others suggested land prices would be inflated to help make a PG&E land buy look prohibitively expensive. An executive of Centex Homes the developer of new houses near Isabel Avenue and Concannon Boulevard objected to an alternative route that would place high-voltage transmission lines overhead along Isabel and Stanley Boulevard. David Barclay president of Centex's Northern California division said that the 80-foot to 150-foot towers would have a severe visual impact on residents of the Prima tract. Ed O'Neill a lawyer for the Kottinger Ranch Homeowners Association pointed out that existing distribution lines on 50-foot poles on Isabel already mar the view for residents. The Foley family has been ranching on land south of Pleasanton city limits for years said their attorney Kennedy Richardson. The utility's project would place overhead lines and a transmission station on rolling hills that the family envisions as one day being public open space with limited development Richardson said. Lawyers for Pleasanton Livermore Kottinger Ranch and Centex are scheduled to cross-examine a PG&E engineer today about the project's routing. That testimony should be the most controversial of the hearings. Judge Cooke is expected to recommend an alignment by July to the PUC which will make the final decision. ---- NEWS State OKs 'Peaker' Power Plant at SFO / Temporary generator could be sending electricity to 50000 homes by August Marshall Wilson 03/08/2001 The San Francisco Chronicle FINAL Page A.20 (Copyright 2001) State energy officials yesterday approved plans to build a temporary electrical plant at San Francisco International Airport that should generate enough juice to power 50000 homes by August. Meeting in Sacramento the Energy Commission voted 4-0 to give the green light to the gas-fired plant. It will operate during peak summer and winter demand to help the state avoid Stage 3 power alerts and rolling blackouts. Texas-based El Paso Merchant Energy Co. won approval under a new state law mandating speedy four-month reviews of so-called peaker plants. It was the only one of seven applications statewide to win approval. The other proposals were withdrawn for various reasons. The 51-megawatt plant formally called the United Golden Gate Power Project is scheduled to be built at the northwest corner of the airport near the United Airlines maintenance center. Within the next few weeks El Paso plans to apply to build a 571- megawatt $400 million plant in the same area company spokesman Jesse Frederick said. It would undergo a separate review by state energy officials. The small peaker plant approved yesterday is to generate electricity beginning around Aug. 1 for up to three years. After the end of three years the plant would be closed or converted to a cleaner-burning system. Under state law a temporary peaker plant is permitted to spew more air pollution than a permanent plant. El Paso's temporary plant is to be built next to a co-generation plant operated by United Airlines. It would use existing connections for natural gas and water supplies and tap into existing power transmission lines. Electricity generated by the plant would be pumped into the state's electrical grid Energy Commission spokesman Gary Fay said. It would also serve as a backup for San Francisco Airport in case of a blackout. No one spoke against the proposed plant at yesterday's commission meeting. The proposal however has been criticized by area residents and environmentalists worried about air pollution. Scott Buschman a professional photographer and San Bruno resident said yesterday it was unjust that state officials 100 miles away in Sacramento approved a Texas company's proposal to put a power plant on land owned by San Francisco. The fact that they approved it without considering the public's concerns foremost air quality is very disturbing he said. Fay said the plant complies with clean-air standards. Answering the criticism about the location of yesterday's deliberation he said three hearings and several workshops were held in communities near the airport. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. ---- Crossed Wires: Major Kinks Emerge In Gov. Davis's Plan To Power California --- State's Outlays for Electricity May Be Hard to Recover Without Rate Increases --- Betting on Long-Term Deals By Wall Street Journal staff reporters Rebecca Smith Mitchel Benson and John R. Emshwiller 03/08/2001 The Wall Street Journal A1 (Copyright (c) 2001 Dow Jones & Company Inc.) SACRAMENTO Calif. -- Earlier this year Gov. Gray Davis made what may be the biggest bet in the history of the nation's biggest state: that he could tame an out-of-control electricity market and avoid devastating blackouts without busting the state's budget antagonizing its consumers or derailing his own political career. His wager is still on the table but the assumptions that underlie it are looking increasingly shaky these days. The governor has already spent around $2 billion of public money buying hugely expensive wholesale power taking over the role formerly played by the state's near-bankrupt electric utilities. And California will probably be obliged to spend billions more before its electricity market stabilizes and those utilities are restored to some semblance of financial health. Under the governor's plan California aims to recoup the money it is using to buy electricity by issuing $10 billion in bonds. That way it would still have a healthy budget surplus to finance new spending on roads schools and other public services. But there's a potentially big obstacle to this plan. The state Legislature worried about racking up billions in new debt has put limits on the size of any bond offering. In broad terms the Legislature's action would allow the state to borrow only four times as much as it can recover annually from utility customers. Right now that doesn't appear to be much. Under the current rate structure essentially set in place by California's flawed 1996 electricity-deregulation plan consumers pay far less for power than the cost of acquiring it on the wholesale market. Preliminary estimates submitted by utilities last month to the California Public Utilities Commission show the state's share of the proceeds from electricity sales this year could be as little as $241 million -- not enough to support even $1 billion in bond sales under the Legislature's formula. That would leave the state on the hook for much of the money it has already paid for power -- not to mention the billions more Gov. Davis will need to spend. That in turn raises the prospect that California's economy and its credit rating both could deteriorate significantly. But state finance officials say that based on their own projections they will be able to extract enough money to support a $10 billion bond issue. Walking a careful line between fiscal prudence and political survival Mr. Davis and others in his administration are scrambling to come up with ways to get around the legislative restrictions without raising rates for consumers. If I wanted to raise rates I could solve this problem in 20 minutes Mr. Davis says. The governor says he believes that the state can obtain enough affordable power through long-term power-supply contracts to avoid the need for a big rate increase. The billions of dollars the state hopes to borrow would be used to help pay for power until electricity prices drop as they are expected to do when new power plants come online over the next few years. The Davis administration fears that what may be its only other option -- a big increase in retail electric rates -- could prompt angry consumer groups to seek new electricity laws through a statewide ballot initiative during next year's election. That's when Mr. Davis is expected to run for a second term as governor. But trying to save California without rate increases is forcing Mr. Davis to make some colossal gambles with the state's money. State officials estimate that in the next several months California will need to spend as much as $6 billion on power purchases -- equivalent to the state's entire fiscal surplus. Mr. Davis is also looking to spend several billion more to buy the transmission assets of three investor-owned utilities in order to restore two of them to credit-worthiness. He also has announced plans to spend several hundred million dollars more on conservation programs designed to reduce demand while new power plants are being built in the state. In order to limit the state's financial exposure in the meantime the governor and his aides have in some cases ignored state law. They have threatened appointed officials who have stood in the way. And they have sharply restricted the flow of information to the public. None of those steps is expected to do much to reduce state spending on power in the coming months. In a few weeks power usage is expected to begin a sharp seasonal rise as Californians switch on their air conditioners with the coming of warmer weather. By various estimates demand during peak periods this summer could outstrip supply by 10% or several thousand megawatts. That could produce more rolling blackouts like the ones that hit Northern California earlier this year. It is also likely to put strong upward pressure on wholesale electricity prices. Steven Zimmerman managing director of Standard & Poor's Corp. says Mr. Davis and his aides don't have a lot of time to put a cap on the state's financial exposure to the crisis. The credit-rating agency has put the state on credit watch for a possible downgrade which would affect the value of all of California's outstanding public debt. Moody's Investor Service Inc. is also concerned. It said in a recent report that the power crisis could soon seriously threaten the health of the state's economy. Mr. Davis a Democrat and career politician was dealt a bad hand when he took office in 1999. The deregulation plan that sparked the state's electricity crisis was enacted under his predecessor Republican Pete Wilson. But Mr. Davis was slow to react to early signs of trouble this past summer and alarms sounded by members of the state Legislature. By the time Mr. Davis finally sprang into action earlier this year a troublesome power-supply squeeze had escalated into a crisis. In a Jan. 17 declaration of emergency the governor designated the state Department of Water Resources to take the utilities' place as the daily buyer of huge quantities of electricity. His hope: that by making the state the dominant player in California's power sector he would ease electricity producers' concerns about getting paid and give the state enough clout to negotiate lower long-term power prices. Earlier this week Mr. Davis announced final or tentative agreements with 20 power suppliers to furnish the state with a total of 8900 megawatts for periods of as long as 20 years. But the supply situation remains extremely uncertain for this summer when demand probably will top 45000 megawatts. If the state can secure enough power under contract and push down demand through aggressive conservation it might be able to squeak through the summer season. If not it will be forced to keep buying huge amounts of costly power in the cash market. Under deregulation retail electric rates were frozen for several years while wholesale-power costs were free to fluctuate. When the plan was conceived wholesale prices were low and expected to go lower. However a combination of unexpected growth in power demand and a lack of new generating capacity helped produce a supply squeeze. Average wholesale prices more than tripled last year from 1999. And in January those prices were up 10-fold from a year earlier. By then California's two biggest investor-owned utilities -- the Pacific Gas & Electric unit of PG&E Corp. and the Southern California Edison subsidiary of Edison International -- faced imminent financial collapse. They had racked up billions of dollars in wholesale power bills they couldn't afford to pay. As generators began shying away from selling to the two utilities the Clinton administration forced them to sell power into the California market an order left in place during the first weeks of the Bush administration. Still northern California was hit by rolling blackouts on several days in early January. Since then the DWR which does some electricity trading as an adjunct to its main mission of managing the state's giant system of aqueducts and reservoirs has had to learn the ins and outs of power markets on the run. It hasn't been easy. David Mills trading-floor manager for the federal Bonneville Power Administration says the water agency has at times offered to pay $50 to $100 per megawatt hour more than the available market price. They agree to prices that make you wonder says Mr. Mills whose organization markets electricity from federal dams in the Pacific Northwest. You'd at least think they'd check to see what the prevailing price is before throwing out their offer. Mr. Mills says that to cut California some slack he occasionally has instructed his traders to sell at prices lower than the DWR had offered to pay. Ray Hart the water agency deputy director responsible for the power purchasing says he isn't aware of any cases in which the DWR has overpaid. He says his team has been extremely successful by all measures. Ultimately the DWR's trading acumen is far less important than the overall arithmetic of power supply and demand in California. With the price of natural gas that feeds many of the region's generating plants at near record levels and some suppliers reluctant to sell into the troubled California market wholesale electric prices remain stubbornly high and in recent days have again been rising. The Legislature has advanced the DWR about $3 billion from the state's general fund for power purchases. Under emergency legislation passed by the Legislature and signed by Mr. Davis on Feb. 1 the general fund is to be reimbursed from a planned bond sale later this year. But under terms of the emergency law the water agency would have to wrest $2.5 billion a year in revenue from retail electricity rates in order to sell the $10 billion worth of bonds sought by Mr. Davis. Assembly Speaker Robert Hertzberg a Southern California Democrat says the formula was created to ensure that there would be a way to repay the bonds without draining the state's coffers. We didn't want to just open our wallets he says. According to the language of the Feb. 1 law the water agency gets what's left of revenue collected from ratepayers after the utilities pay certain of their own power-supply bills and other expenses. And in their filings with the PUC last month the utilities reckoned under their worst-case scenarios that there would be only $241 million available to the DWR this year. State officials are quietly pushing the PUC to rejigger the formula so that the water department gets more money -- even though that would clash with terms of the Feb. 1 law. Robert Miyashiro deputy director of the Department of Finance says the emergency law was drafted poorly and has led people to believe the DWR only gets the leftover money. He predicts there will be cleanup legislation. At the request of the Davis administration the PUC is considering a plan to use a different revenue-sharing formula than the one in the state law. The proposed new formula was written in close consultation with Mr. Davis's Finance Department says PUC President Loretta Lynch who supports the initiative and is hoping to rush it through. The effort has drawn some opposition. Commissioner Richard Bilas at a recent PUC meeting questioned the legality of the commission attempting to change a formula set by the Legislature. PG&E is even more emphatic since the DWR's extra money could come at the utility's expense. The formula threatens to undo the very financial protections for the utilities that [the new law] attempted to provide the utility said in a recent filing with the PUC. As politicians and regulators wrestle with that issue the Davis administration has taken a step to reduce the outflow of state cash that also seems to conflict with the Feb. 1 law. It was widely assumed that the law required the DWR to buy any electricity the state needed to keep its lights on. However on many occasions the DWR has refused to buy power on the grounds that it was too expensive citing a portion of the new law that urges the agency to hold down costs. The task of covering any remaining shortfall has passed to the California Independent System Operator which manages the state's energy grid and is charged with buying power when necessary to avert shortages. However the ISO doesn't have any power-purchasing money of its own and the major parties it would normally bill are PG&E and Edison whose inability to pay their power bills was the reason the state started buying electricity in the first place. Amid criticism of its stance from generators utilities and Wall Street the DWR says it has started covering more of the utilities' electricity costs. The water agency is now buying 95% to 99% of what California needs in a given day says the agency's Mr. Hart. But increased buying only adds to the uncertainty about the eventual tab. The state's legislative analyst Elizabeth Hill recently recommended that lawmakers hold off considering more than $2 billion in state spending on items ranging from college construction to beach cleanups because of continuing questions about the financial impact of the electricity crisis. Like others Ms. Hill complains that the governor's office and state agencies haven't been forthcoming with information. Indeed the DWR refuses to say precisely how much power it is purchasing and at what prices though it has on several occasions gone back to the Legislature for more money. State officials say that data on its purchasing activities would give suppliers an advantage in continuing electricity-supply contract talks. State Controller Kathleen Connell who is running for mayor of Los Angeles in an April election recently announced plans to post state power-spending information on her department's Web site. But within 24 hours Ms. Connell suspended that plan after discussions with senior Davis administration officials. I feel very strongly that this information should be publicly released says Ms. Connell. I just don't want to do anything that would weaken the state's effectiveness in negotiating. In an effort to more tightly control events the governor obtained legislative approval to abolish the 26-member ISO board which was made up of everyone from utility executives to representatives of consumer groups. He then appointed a new five-member board. To ensure a quick transition the California attorney general threatened the old board members with fines of as much as $5000 each if they didn't immediately relinquish their positions. All did. I was offended at the heavy-handed treatment says Karen Johanson a former ISO board member. One of the first acts of the ISO's new board was to close a meeting about the electricity crisis. The former ISO board routinely held such meetings in public. ISO attorneys say the meeting was largely designed as a private briefing for new board members and that the organization is committed to keeping its deliberations as open as possible. The Wall Street Journal and other news organizations have unsuccessfully challenged the closure in Sacramento state court. Copyright 2000 Dow Jones & Company Inc. All Rights Reserved. What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential - Don Black Body:: I'm fine with it. m What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Confidential - Lavos Trading Program Body:: You missed logistics as a rotaion. Also - Let's leave out where they graduate to. This might be an issue with the AA program if we say that they are going to re-enter the program. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: The ""Dark"" Side of Popular Culture Body:: Jeff I thought you might find this of interest. Who would have guessed that the California power crisis and Gray Davis could be so funny. Kevin Los Angeles Daily News Friday June 22 2001 'Tonight Show' pokes fun at power crisis By Fred Shuster Staff Writer BURBANK -- Jay Leno pulled the plug on his late-night chat show Thursday doing his part for the state's energy crisis but viewers weren't left in the dark. Flashlights mining helmets and multicolor glow sticks helped to illuminate the set for the show dubbed a one-time-only The Tonight Show Unplugged which Leno said saved enough electricity to light a house for a month. [IMAGE] The unplugged edition of The Tonight Show with Jay Leno pokes fun at the California power crisis(Reed Saxon / A.P.) Call it NBC's Can't See TV. This is not some cheap rating ploy. ... If this works they're gonna make us do this every night Leno joked as part of his opening monologue. The nationally broadcast show featuring a comic interlude with California Gov. Gray Davis utilized just a small amount of electricity to run the cameras Leno said before the show began. Actually in Burbank where the taping took place at NBC Studios the city owns the power company and residents and businesses have not been hit by rolling blackouts as in other areas. The city made $5 million in profit in May after racking up $60 million in excess power sales. But Leno said not using studio lights TV monitors amplifiers and other power sources Thursday saved enough electricity to light a four-bedroom house for a month. Members of the house band wore miner's helmets with group leader Kevin Eubanks strumming an acoustic guitar rather than his regular electric instrument. The stage was lit by candles torches and flashlight beams trained on Leno. Members of the studio audience used the gear to help brighten the set. This is real goofy Leno said before taping got under way. We'll see what happens. Guests included Arsenio Hall Gilbert Gottfried a trainer of nocturnal animals and a Hawaiian fire dancer -- and a brief visit from the governor. Exuding whatever is the direct opposite of charisma Davis had a brief exchange with Leno drawing laughs with the line This is the first time Gray Davis and (the word) electricity have ever appeared in the same sentence. Leno's staff wore glasses with small lights attached and audience prompter Bob Perlow held a hand-scrawled applause sign aloft throughout the show instead of switching on the usual electric model. While there was little energy in play there was no shortage of laughs. Leno joked that President George W. Bush told Davis not to worry because I've been operating in the dark for years. Those in the studio said Leno's nocturnal transmission added excitement to the program. It was cool said Lillie Harrell 17 a tourist from Hammond La. The crowd got really involved. I guess it shows you don't really need all those lights. Added Jose Tano 21 a Burbank resident and student at the University of California Los Angeles It was a good idea and a great way to make a point. The local power company might not have made out very well but the studio audience didn't end up empty-handed. Each received a fluorescent lantern and pack of batteries as they left the studio. Contact Information E-mail kevinscott@onlinemailbox.net Phone (213) 926-2626 Fax (707) 516-0019 Traditional Mail PO Box 21074 ?Los Angeles CA 90021 - image001.jpg - image001.jpg What should this email be categorized as? [/INST] Purely Personal " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: RE: PG&E PX Credit Calculation -- CONFIDENTIAL ATTY CLIENT WORK PRODUCT Body:: Alan -- The only way to collect the overpayment is to artificially reduce the PX Credit going forward to thereby allow for more CTC. Jim What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Emissions Strategy Meeting Body:: calendar - fyi ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Additions to Working Groups Body:: yes -- just make sure the working group leaders know. Maureen McVicker 12/30/99 02:56 PM To: Steven J Kean/HOU/EES@EES cc: Subject: Additions to Working Groups SK - STILL OK TO KEEP ADDING PEOPLE? mm ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Confidential --CFTC Chair Body:: what do you think? What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Question For All-Employee Meeting Body:: I don't know. Can we get someone in IT to respond? Mary Clark 09/26/2000 05:42 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: Re: Question For All-Employee Meeting Steve I believe the answer is that we don't mandate a specific format for dates for all locations but rather use what is done locally -- just like this employee's recollection. Do you agree? Mary ----------------- What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Purchased TWA ticket for flight Des Moines/DC. Didnt use United ticket for this leg. Body:: In DC to do Lou Pai's speech. You speak between 10:30 and 12:00. 3:00 House staff briefing by John Runyon of International Paper What should this email be categorized as? [/INST] Logistic Arrangements " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Enron Mentions Body:: See first item below What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Management Conference - Save the Date Body:: looks fine From: Terrie James/ENRON@enronXgate on 07/19/2001 04:31 PM To: Steven J Kean/NA/Enron@Enron Cindy Olson/ENRON@enronXgate cc: Sherri Sera/ENRON@enronXgate Marge Nadasky/ENRON@enronXgate Subject: Management Conference - Save the Date Steve and Cindy Attached is the electronic Save the Date memo for the Management Conference. We are preparing to send it out next week. Please let me know if you have any comments or concerns on the e-mail. As for distribution we've worked with HR on the distribution list for VPs but will circle back with David Oxley's team to ensure we have the most up-to-date list. Since some VPs in redeployment will most likely find positions within Enron by November I don't plan to exclude them from the distribution ... unlike United Way where we are not soliciting employees in redeployment for a contribution. I look forward to any feedback. Terrie James Senior Director Public Relations Enron Broadband Services (ph) 713.853.7727 (fax) 713.646.3248 terrie.james@enron.com What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FINAL Body:: Attached is the final letter. Please note - there was a small change at the top of page 2. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: White House To Support FERC Action Today Body:: Fyi - price cap events of the week. ----------------- What should this email be categorized as? [/INST] Company Business/Strategy " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: Re: Letter to Bob Houck Body:: The letter looks fine. Set it up as your letter to Ken Lay was forwarded to me for response and have Jeff B sign. Thanks Marcia A Linton 09/20/2000 04:04 PM To: Steven J Kean/NA/Enron@Enron Maureen McVicker/NA/Enron@Enron cc: Subject: Letter to Bob Houck Here is the draft letter to Bob Houck from Ken Lay that Jeff Brown asked me to forward to you. What should this email be categorized as? [/INST] Document editing/checking/collaboration " "[INST] <> You are reviewing an email using its subject and body. Based on the text in its subject and body, please categorize this email into one of the following categories: 1. 'Company Business/Strategy' 2. 'Purely Personal' 3. 'Personal but in a professional context' 4. 'Logistic Arrangements' 5. 'Employment arrangements' 6. 'Document editing/checking/collaboration' 7. 'Empty message (due to missing attachment)' 8. 'Empty message' Please provide only one category (e.g., 'Purely Personal'). <> Subject:: FYI Body:: Let's add this to our daily distribution. ----------------- What should this email be categorized as? [/INST] Logistic Arrangements "